UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 ( d ) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to ___________.
Commission File Number: 0-27256
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
(Exact name of small business issuer as specified in its charter)
DELAWARE 65-0512785
(State or other jurisdiction of (I.R.S. Employer Identification number)
incorporation or organization)
200 East Palmetto Park Road, Suite 200, Boca Raton, Florida 33432
(Address of principal executive offices)
Registrant's telephone no., including area code: (561) 393-6685
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Securities Exchange Act of 1934 during the past 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.
YES [ X ] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.
CLASS OUTSTANDING AS OF MAY 14, 1999
----------------------------- ------------------------------
Common Stock, $.001 par value 13,134,331
<PAGE>
TABLE OF CONTENTS
Heading Page
PART 1. - FINANCIAL INFORMATION
Item 1. Financial Statements ....................................... 2
Consolidated Balance Sheet - March 31, 1999 (Unaudited)..... 3-4
Consolidated Statement of Income and Comprehensive
Income (Unaudited) ......................................... 5-6
Consolidated Statement of Cash Flows - Three Months ended
March 31, 1999 (Unaudited) ............................... 7-8
Notes to Consolidated Financial Statements (Unaudited) ..... 9-11
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations .................................. 12-13
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings........................................... 14
Item 2. Changes In Securities....................................... 14
Item 3. Defaults Upon Senior Securities............................. 14
Item 4. Submission of Matters to a Vote of Securities Holders ...... 14
Item 5. Other Information .......................................... 14
Item 6. Exhibits and Reports on Form 8-K............................ 14
Signatures ................................................. 15
<PAGE>
PART 1
Item 1. Financial Statements
The following unaudited Financial Statements for the period ended March
31, 1999, have been prepared by Atlantic International Entertainment,
Ltd. (the "Company") and Subsidiaries.
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
Financial Statements
March 31, 1999
2
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
ASSETS:
CURRENT ASSETS:
<S> <C>
Cash and Cash Equivalents $ 9,102
Investments 3,374,927
Accounts Receivable [Net of Allowance for Doubtful Accounts $4,600] 17,486
Notes Receivable 927,403
Deferred Tax Asset 154,212
Prepaid Expenses 35,634
Due from Related Parties 56,068
Other Current Assets 25,700
----------
TOTAL CURRENT ASSETS 4,600,532
----------
PROPERTY AND EQUIPMENT - NET 395,463
----------
EQUIPMENT UNDER CAPITALIZED LEASE - NET 91,468
----------
SOFTWARE [NET OF ACCUMULATED AMORTIZATION OF $916,627] 1,728,963
----------
OTHER ASSETS:
Other Assets 111,526
Notes Receivable 2,417,968
Investments 291,691
----------
TOTAL OTHER ASSETS 2,821,185
----------
TOTAL ASSETS $9,637,611
==========
</TABLE>
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements.
3
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF MARCH 31, 1999
LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
Accounts Payable and Accrued Expenses $ 833,857
Notes Payable - Officers 20,000
Current Portion of Capital Lease Obligations 29,816
------------
TOTAL CURRENT LIABILITIES 883,673
CAPITAL LEASE OBLIGATIONS 71,929
------------
TOTAL LIABILITIES 955,602
------------
STOCKHOLDERS' EQUITY:
Convertible Preferred Stock - Par Value $.001 Per Share;
Authorized 10,000,000 Shares, Issued and Outstanding,
2,260 shares [Liquidation Preference $226,000] 2
Common Stock - Par Value $.001 Per Share;
Authorized 100,000,000 Shares, Issued - 12,806,762 Shares 12,806
Additional Paid-in Capital 12,054,008
Treasury Stock, 533,175 Common Shares - At Cost (1,244,740)
Accumulated Comprehensive Gain 648,385
Accumulated [Deficit] (943,452)
Deferred Acquisition Costs (400,000)
------------
Total 10,127,009
Less: Subscriptions Receivable (1,445,000)
------------
TOTAL STOCKHOLDERS' EQUITY 8,682,009
------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 9,637,611
============
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements.
4
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
1 9 9 9 1 9 9 8
------- -------
<S> <C> <C>
REVENUE $ 29,000 $ 1,030,540
COST OF SALES 268,848 183,379
----------- -----------
GROSS [LOSS] PROFIT (239,848) 847,161
----------- -----------
OPERATING EXPENSES:
Research and Development 58,513 --
General and Administrative 1,103,874 357,747
Provision for Doubtful Accounts and Notes 325,335 99,153
Depreciation and Amortization 31,439 57,170
----------- -----------
TOTAL OPERATING EXPENSES 1,519,161 514,070
----------- -----------
[LOSS] INCOME FROM OPERATIONS (1,759,009) 333,091
----------- -----------
OTHER [EXPENSES] INCOME:
Interest Income 8,110 3,371
Interest Expense (16,129) (6,758)
Interest Expense - Related Party -- (3,508)
Other Income [Expense] 1,423,443 --
----------- -----------
OTHER [EXPENSES] INCOME - NET 1,415,424 (6,895)
----------- -----------
[LOSS] INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAX [BENEFIT] EXPENSE (343,585) 326,196
INCOME TAX [BENEFIT] EXPENSE (123,691) (27,412)
----------- -----------
[LOSS] INCOME FROM CONTINUING OPERATIONS (219,894) 298,784
DISCONTINUED OPERATIONS:
[Loss] from Operations of Discontinued Business
Segment [Net of Income Tax [Benefit] of ($30,521) and $(0),
for the three months ended March 31, 1999 and 1998, Respectively] (54,261) (20,097)
----------- -----------
NET [LOSS] INCOME (274,155) 278,687
COMPREHENSIVE GAIN:
Unrealized Holding Gain arising during period 744,243 --
----------- -----------
TOTAL COMPREHENSIVE INCOME $ 470,088 $ 278,687
=========== ===========
</TABLE>
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements.
5
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
1 9 9 9 1 9 9 8
------- -------
<S> <C> <C>
Net [Loss] Income $ (274,155) $ 278,687
Preferred Stock Dividend in Arrears 12,500 --
------------ ------------
NET [LOSS] INCOME AVAILABLE TO COMMON STOCKHOLDERS $ (286,655) $ 278,687
============ ============
[LOSS] INCOME PER COMMON SHARE:
Continuing Operations $ (0.02) $ 0.03
------------ ------------
BASIC AND DILUTED NET [LOSS] INCOME PER SHARE OF COMMON STOCK $ (0.02) $ 0.03
============ ============
WEIGHED AVERAGE SHARES OF COMMON STOCK OUTSTANDING 12,559,208 9,590,184
============ ============
</TABLE>
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements.
6
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
1 9 9 9 1 9 9 8
------- -------
OPERATING ACTIVITIES:
<S> <C> <C>
[Loss] Income from Continuing Operations $ (219,894) $ 298,784
Adjustments to Reconcile Net [Loss] Income to
Net Cash [Used for] Operating Activities:
Depreciation and Amortization 251,387 126,437
Deferred Tax Asset (154,212) --
Provision for Doubtful Accounts 325,335 99,153
Loss on Sale of Assets 3,100 --
Realized Loss on Carrying Value of Investments 324 --
Gain on Sale of Subsidiary (1,256,473) --
Changes in Assets and Liabilities:
[Increase] Decrease in:
Accounts Receivable 1,914 (7,871)
Prepaid Expenses (24,377) --
Notes Receivable 84,975 (731,359)
Other Assets 76,815 (16,354)
Increase [Decrease] in:
Accounts Payable and Accrued Expenses (241,124) (88,189)
Income Taxes Payable -- 30,628
Other Current Liabilities -- 28,583
Due to Customer -- 54,279
----------- -----------
NET CASH - CONTINUING OPERATIONS (1,152,230) (205,909)
----------- -----------
DISCONTINUED OPERATIONS:
[Loss] from Discontinued Operations (54,261) (20,097)
Adjustments to Reconcile Net [Loss] to Net Cash Operations:
Depreciation and Amortization 38,220 10,315
Provision for Doubtful Accounts 18,915 1,423
Changes in Net Assets and Liabilities 260,011 (37,121)
----------- -----------
NET CASH - DISCONTINUED OPERATIONS 262,885 (45,480)
----------- -----------
NET CASH - OPERATING ACTIVITIES - FORWARD (889,345) (251,389)
----------- -----------
INVESTING ACTIVITIES - CONTINUING OPERATIONS:
Increase in Due from Related Parties (828) (747)
Purchase of Investments (187,664) --
Purchase of Property, Equipment, and Capitalized Software (42,212) (127,115)
Sale of Investments 2,566,858 --
----------- -----------
NET CASH - INVESTING ACTIVITIES - CONTINUING OPERATIONS -
FORWARD $ 2,336,154 $ (127,862)
</TABLE>
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements.
7
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
---------
1 9 9 9 1 9 9 8
------- -------
<S> <C> <C>
NET CASH - OPERATING ACTIVITIES - FORWARDED $ (889,345) $ (251,389)
----------- -----------
NET CASH - INVESTING ACTIVITIES - CONTINUING OPERATIONS -
FORWARDED 2,336,154 (127,862)
----------- -----------
INVESTING ACTIVITIES - DISCONTINUED OPERATIONS:
Purchase of Property and Equipment (29,715) (8,754)
Disposition Gain on Sale of Discontinued Operations -- --
----------- -----------
NET CASH INVESTING ACTIVITIES - DISCONTINUED OPERATIONS (29,715) (8,754)
----------- -----------
FINANCING ACTIVITIES - CONTINUING OPERATIONS:
Proceeds from Conversion of Debt to Equity -- --
Proceeds from Issuance of Common Stock -- 299,900
Proceeds from Issuance of Preferred Stock -- --
Purchase of Treasury Stock (966,043) --
[Decrease] Increase in Loan Payable to Shareholder (130,000) 88,609
Payment of Notes Payable (100,000) --
Payment of Lease Payable (7,453) (5,826)
Decrease in Loan Receivable (274,762) --
----------- -----------
NET CASH - FINANCING ACTIVITIES - CONTINUING OPERATIONS (1,478,258) 382,683
----------- -----------
FINANCING ACTIVITIES - DISCONTINUED OPERATIONS:
Proceeds from Long-Term Debt 50,000 --
Payment of Note Payable (41,500) (1,900)
Payment of Lease Payable (5,769) (10,326)
----------- -----------
NET CASH FINANCING ACTIVITIES DISCONTINUED OPERATIONS 2,731 (12,226)
----------- -----------
NET INCREASE [DECREASE] IN CASH AND CASH EQUIVALENTS (58,433) (17,548)
CASH AND CASH EQUIVALENTS - BEGINNING OF YEARS 67,535 11,260
----------- -----------
CASH AND CASH EQUIVALENTS - END OF YEARS $ 9,102 $ (6,288)
=========== ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the years for:
Interest $ 16,128 $ 6,758
Income Taxes $ -- $ --
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Conversion of Preferred Stock into Common Stock $ 396 $ --
Purchase of Assets under Capital Lease Financing $ 6,210 $ --
</TABLE>
The Accompanying Notes are an Integral Part of these Consolidated Financial
Statements
8
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
Notes to Consolidated Financial Statements (Uunaudited)
March 31, 1999
Note 1 - BASIS OF PREPARATION
The accompanying unaudited interim financial statements include all
adjustments (consisting only of those of a normal recurring nature)
necessary for a fair statement of the results for the interim
periods. The results of operations for the three-month period ended
March 31, 1999, are not necessarily indicative of the results of
operations to be reported for the full year ending December 31,
1999.
Note 2 - SALE OF SUBSIDIARY
On March 31, 1999 the Company sold 81% of its interest in its wholly
owned subsidiary, the Eminet Domain, Inc. to Centerline Associates,
Inc., a shareholder of the Company. The sale price was $2,500,000
paid as follows: (i) $10,000 at sale date, (ii) $90,000 in cash
payable at the rate of $14,000 per month commencing on April 15,
1999 and (iii) $2,400,000 by the delivery of a promissory note
collateralized by shares of the Company's stock with interest at the
annual rate of six percent (6%) and payable two years from the
closing date.
The sale resulted in a gain of $1,256,743 which is reflected in
other income. The transaction resulted in the Eminet Domain, Inc
being treated as a discontinued operation
Note 3 - MAJOR CUSTOMERS
Income fees derived from major customers are tabulated as follow:
THREE MONTHS ENDED
MARCH 31,
1999 1998
(UNAUDITED)
Customer A (Software System) -- 250,000
Customer B (Software System) -- 220,000
Customer C (Software System) -- 350,000
Note 4 - CAPITAL STOCK
In the second quarter of 1998, the Company sold 1,250,000 shares for
a total of $4,000,000 pursuant to Regulation D to Hosken
Consolidated Industries
Also in the second quarter of 1998, 9,700,000 shares of common stock
were issued to Atlantic International Entertainment Australia, a
wholly owned subsidiary for use in a proposed takeover of the
Australian Company, Coms21. As the proposed takeover did not take
place, the 9,700,000 shares issued were cancelled. However, in the
third quarter of 1998, 1,217,647 shares were exchanged for
12,176,470 shares of Coms21 in a one for ten stock swap.
9
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Uunaudited) (Continued)
March 31, 1999
Note 4 - CAPITAL STOCK - CONTINUED
In the second quarter of 1998, 10,000 shares of 5% Convertible
Preferred Stock, $.001 par value, were issued to the Shaar Fund for
$1,000,000.00. Each share is convertible into common stock by virtue
of a formula contained in the Purchase Agreement which is 78% of the
three day average closing bid price for the corporations common
stock for the twenty five (25) trading days prior to the delivery of
the notice of redemption. The amount of such non-cash discounts
which is analogous to a dividend is $269,443. Holders of the above
preferred stock are entitled to; (i) quarterly cumulative dividends
at the rate of 5% per annum of the original issue price of the
preferred stock, (ii) a liquidation preference equal to the sum of
$100 for each outstanding share of the preferred stock.
In August 1998, 5,000 shares of the Company's common stock were
issued to a consultant for services performed.
In September 1998, 26,098 shares of the Company's common stock were
issued to adjust the issuance of shares to certain individuals at
the time of the Company's reverse merger in 1996.
During the third and fourth quarter of 1998, 2,740 shares of
convertible preferred stock valued at $274,000 was converted into
147,002 shares of common stock by virtue of a formula contained in
the Purchase Agreement which relates to the average price per share
of common stock within the conversion period.
In October of 1998, the Company entered into a stock purchase
agreement with Axxsys International, [Seller] to purchase the assets
of Axxsys for $400,000. Under the agreement 200,000 shares of the
Company's common stock was delivered and is held in escrow for a
period of 12 months as the purchase price is contingent on average
monthly revenues being achieved.
During the first quarter of 1999, 5,000 shares of convertible
preferred stock valued at $500,000 was converted into 395,823 shares
of common stock by virtue of a formula contained in the purchase
agreement which results to the average price per share of common
stock within the conversion period.
Note 5 - PER SHARE DATA
Per share data are based on the weighted average number of common
shares outstanding during the respective periods. The diluted net
income per share is based upon the options issued and outstanding as
well as the assumed conversion of the Company's issued and
outstanding preferred stock.
10
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Uunaudited) (Continued)
March 31, 1999
Note 6 - BUSINESS AGREEMENTS
In February 1998, the Company entered into a Development Service
Agreement with International Transaction System Corp. ["ITS']. The
Company's responsibilities under the agreement include engaging in
the development activity required to host ITS on the Company's
software and selling debt card processing [`DCP']. ITS'
responsibilities include development activity required to develop
the DCP test methodology and/or test cases so that the Company may
validate correct operation of the DCP and provide service support.
Under the Agreement, the Company paid $20,000 to acquire access to
DCP through ITS for the purpose and exclusive application in the
Company's software. Transaction fees earned by customers will be
distributed 75% and 25% to the Company and ITS, respectively. The
initial term of the agreement is 10 years, and automatically renews
in 5 year consecutive periods, unless terminated by either party.
On September 28, 1998, the Company entered into and closed on an
agreement with Cybergames, Inc. for the purchase of several of the
company's licensees and the exchange of the company's accounts
receivable from said licensees. The total purchase price was $
3,147,000 payable $ 227,000 in cash and $2,920,000 in stock of
Cybergames, Inc. (530,000 shares).
Note 7 - SUBSEQUENT EVENTS
On April 6, 1999 the Company signed an agreement to purchase the
patent rights, inventions and know-how of Excel Communications, Inc.
The major product expected to be produced is a multi-function
portable gaming device. In consideration the Company issued seventy
five thousand (75,000) shares of common stock of the Company. The
Company also entered into an agreement to compensate a third party
for termination of an exclusive manufacturing, licensing, marketing
and distribution of the invention with the seller. The third party
received two hundred thousand dollars ($200,000) plus a stock option
to purchase 50,000 shares of the common stock of the company. In
addition, the Company entered into employment agreements with three
of the key employees of Excel Communications, Inc. and granted those
individuals options to purchase Company stock.
In April 1999 HCI, Ltd. a South African public company exercised its
option to purchase 1.1 million shares at $2 per share from the
non-executive chairman, Norman J. Hoskin. HCI is the Company's
largest institutional shareholders. The agreement is subject to
appropriate approval from the South African Reserve Bank.
11
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAIMENT, LTD. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS RECENT DEVELOPMENTS
RESULT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1999 AND 1998
NET REVENUES. The Company's revenues decreased approximately 97% in
1999 over the same period in 1998. Revenues from operations in the
first quarter 1999 were $ 29,000, as compared with $ 1,030,540 for
the same period in 1998. The decrease in revenues was the result of
the enhancement and upgrading of its product. The Company stopped
promotion of the old version and did not allocate large resources to
sales and marketing. The Company intends to allocate large resources
to sales and marketing for its upgraded product in 1999 and expects
revenues to substantially increase.
COST OF REVENUES. Cost of revenues increased 47% in 1999 over the
same period in 1998. The increase resulted from the increase in
amortization of capitalized software development costs, which is
reflected in cost of revenues. The Company expects amortization of
development costs to be consistent going forward.
OPERATING EXPENSES. Operating expenses increased by 208% or $
746,127 in the first quarter 1999 over the same period in 1998. The
increase was largely due to global expansion efforts, expenses
related to product development and increased support staffing.
PROVISION FOR DOUBTFUL ACCOUNTS. Provision for doubtful accounts in
the first quarter 1999 were $ 325,335 as compared with $ 99,153 for
the same period in 1998. The increase resulted from management
taking a conservative approach in recording its provision for
doubtful accounts. The Company currently expects that the provision
for doubtful accounts will not increase at the same rate going
forward.
OTHER INCOME. Other income increased by approximately $1,400,000 in
1999 over the same period in 1998. A gain on sale of $1,256,743
resulted from a percentage interest sold of the Company's wholly
owned subsidiary. A $170,000 gain was recognized in a full and final
settlement of a payable.
LIQUIDITY AND CAPITAL RESOURCES
Cash, cash equivalents and marketable securities, which consist
primarily of high risk, priced securities totaled $3,384,029 at
March 31, 1999 compared to $8,100 at March 31, 1998. The increase in
cash, cash equivalents and marketable securities was due primarily
to cash proceeds from the sale of Common Stock ($4,000,000) pursuant
to Registration Statement S-8, exchange of the Company's shares to
an Australian listed Company for shares of the Australian company in
a one for ten stock swap resulting in ($3,351,000) proceeds and
issuance of Common Stock of a public traded company (Purchaser) in
lieu of certain assets sold to the purchaser ($2,137,000).
12
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAIMENT, LTD. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS RECENT DEVELOPMENTS
LIQUIDITY AND CAPITAL RESOURCES - Continued
The increase was offset by cash used for operations, a $2,000,000
debenture note issued by a foreign corporation and $1,200,000 for
the purchase of treasury stock relating to the company's stock buy
back plan. Management believes that existing cash, cash equivalents,
marketable securities and anticipated cash generated from operations
will be sufficient to satisfy the Company's currently anticipated
cash requirements.
13
<PAGE>
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD. AND SUBSIDIARIES
PART II
Item 1. Legal Proceedings
Litigation - The Company is party to litigation arising from the normal
course of business. In management's' opinion, this litigation will not
materially affect the Company's financial position, results of
operations or cash flows.
Item 2. Changes in Securities
This Item is not applicable to the Company.
Item 3. Defaults upon Senior Securities
This Item is not applicable to the Company.
Item 4. Submission of Matters to a Vote of Security Holders
This Item is not applicable to the Company.
Item 5. Other Information
This Item is not applicable to the Company.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data Schedule
14
<PAGE>
In accordance with the requirements of the Securities Exchange Act of
1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Atlantic International Entertainment, Ltd.
Date: May 18, 1999 By: /s/ Richard A. Iamunno
-------------------------------------
(Signature)
Richard A. Iamunno, President
And Chief Executive Officer
Date: May 18, 1999 By: /s/ Trevor Klein
-------------------------------------
(Signature)
Trevor Klein
Principal Accounting Officer
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Atlantic
International Entertainment, Ltd.'s financial statements as of March 31, 1999
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 9,102
<SECURITIES> 3,374,927
<RECEIVABLES> 4,060,112
<ALLOWANCES> (697,255)
<INVENTORY> 0
<CURRENT-ASSETS> 4,600,532
<PP&E> 586,510
<DEPRECIATION> (191,047)
<TOTAL-ASSETS> 9,637,611
<CURRENT-LIABILITIES> 883,673
<BONDS> 0
<COMMON> 12,806
0
2
<OTHER-SE> 8,669,201
<TOTAL-LIABILITY-AND-EQUITY> 9,637,611
<SALES> 29,000
<TOTAL-REVENUES> 29,000
<CGS> 268,848
<TOTAL-COSTS> 1,519,161
<OTHER-EXPENSES> (1,423,443)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,129
<INCOME-PRETAX> (343,585)
<INCOME-TAX> (123,691)
<INCOME-CONTINUING> (219,894)
<DISCONTINUED> (54,261)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (274,155)
<EPS-PRIMARY> (0.02)
<EPS-DILUTED> (0.02)
</TABLE>
