UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
For the quarterly period ended February 28, 1998.
[ ] TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number - 000-22813
North Atlantic Acquisition Corp.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
13-3853272
(I.R.S. Employer Identification No.)
5 East 59th Street, 3rd. Floor, New York, New York 10022
(Address of principal executive offices - Zip code)
- --------------------------------------------------------------------------------
Registrant's telephone number, including area code: (212) 486-4444
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changes since last
report.
Indicate by checkmark 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 (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 ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by checkmark whether the registrant has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court.
Yes ___ No ___
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date.
Common stock, par value $.01 per share, 906,000 shares outstanding as of March
31, 1998.
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Index
================================================================================
Part I - Financial Information
Item 1. Financial Statements:
Balance sheets as of February 28, 1998 and
August 31, 1997 3
Statements of operations for the three and six months
ended February 28, 1998 and 1997 and period
September 1, 1995 to November 30, 1997 4
Statements of stockholders' equity for the period
September 1, 1995 to February 28, 1998 5
Statements of cash flows for the six months
ended February 28, 1998 and period
September 1, 1995 to February 28, 1998 6
Notes to financial statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Part II - Other Information
Item 1. Legal Proceedings 9
Item 2. Changes in Securities 9
Item 3. Defaults Upon Senior Securities 9
Item 4. Submission of Matters to a Vote of Security Holders 9
Item 5. Other Information 9
Item 6. Exhibits and Reports on Form 8-K 9
Signatures 10
2
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 1. Financial Statements
Balance Sheets
================================================================================
<TABLE>
<CAPTION>
February 28, August 31,
1998 1997
- ----------------------------------------------------------------------------------------------------------------------------------
(Unaudited) (Audited)
<S> <C> <C>
Assets
Cash $ 190,485 $ 400,535
Cash held in escrow 324 1,676
Investment in treasury securities held in escrow 8,213,300 7,998,324
- ----------------------------------------------------------------------------------------------------------------------------------
$8,404,109 $8,400,535
- ----------------------------------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity
Liabilities:
Accrued expenses $ 166,094 $ 182,431
Notes payable - 100,000
- ----------------------------------------------------------------------------------------------------------------------------------
Total liabilities 166,094 282,431
- ----------------------------------------------------------------------------------------------------------------------------------
Commitments
Common stock subject to possible conversion, 160,000 shares at
redemption value 1,642,725 1,600,000
- ----------------------------------------------------------------------------------------------------------------------------------
Stockholders' equity:
Convertible preferred stock, $.01 par value - shares authorized 1,000,000;
outstanding none; subscribed 94; liquidation value - $9,400 93 1
Subscription receivable (100) (9,400)
Class A common stock, $.01 par value - shares authorized 10,000,000;
outstanding 906,000 9,060 9,060
Class B common stock, $.01 par value - shares authorized 250,000;
issued and outstanding 150,000 1,500 1,500
Additional paid-in capital 6,586,856 6,586,948
Earnings (deficit) accumulated during the development stage (2,119) (70,005)
- ----------------------------------------------------------------------------------------------------------------------------------
Total stockholders' equity 6,595,290 6,518,104
- ----------------------------------------------------------------------------------------------------------------------------------
$8,404,109 $8,400,535
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 1. Financial Statements
Statements of Operations
(Unaudited)
================================================================================
<TABLE>
<CAPTION>
Three months ended Six months ended Period from
February 28, February 28, September 1, 1995
-------------------------------------------------------------- (inception) to
1998 1997 1998 1997 February 28, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Interest income $ 108,624 $ -- $ 213,624 $ -- $ 213,624
General and administrative
expenses and debt costs 92,013 1,415 103,013 3,846 173,018
- ------------------------------------------------------------------------------------------------------------------------------------
Net income (loss) $ 16,611 $ (1,415) $ 110,611 $ (3,846) 40,606
====================================================================================================================================
Net income (loss) per common
share $ .02 $ (.01) $ .12 $ (.04)
====================================================================================================================================
Weighted average common
shares outstanding 906,000 106,000 906,000 106,000
====================================================================================================================================
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 1. Financial Statements
Statements of Stockholders' Equity
================================================================================
<TABLE>
<CAPTION>
Class A
---------------------
Preferred stock Common stock
------------------ Subscription ---------------------
Shares Amount receivable Shares Amount
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Issuance of founders' shares -- $ -- $ -- 86,000 $ 860
Sale of common stock -- -- -- 20,000 200
Subscription receivable 94 1 (9,400) -- --
Net loss -- -- -- -- --
- -----------------------------------------------------------------------------------------------------
Balance, August 31, 1996 94 1 (9,400) 106,000 1,060
Net loss -- -- -- -- --
Sale of common stock, net -- -- -- 800,000 8,000
Reclassification to
redeemable common stock -- -- -- -- --
- -----------------------------------------------------------------------------------------------------
Balance, August 31, 1997
(Audited) 94 1 (9,400) 906,000 9,060
Subscription paid -- 92 9,300 -- --
Net income -- -- -- -- --
Accretion to redemption
value of common stock -- -- -- -- --
- -----------------------------------------------------------------------------------------------------
Balance, February 28, 1998
(Unaudited) 94 $ 93 $ (100) 906,000 $ 9,060
=====================================================================================================
<CAPTION>
Earnings
Class B (deficit)
------------------- accumulated
Common stock Additional during the Total
------------------- paid-in development stockholders'
Shares Amount capital stage equity (deficit)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Issuance of founders' shares -- $ -- $ 7,740 $ -- $ 8,600
Sale of common stock -- -- 44,800 -- 45,000
Subscription receivable -- -- 9,399 -- --
Net loss -- -- -- (31,085) (31,085)
- -----------------------------------------------------------------------------------------------------------
Balance, August 31, 1996 -- -- 61,939 (31,085) 22,515
Net loss -- -- -- (38,920) (38,920)
Sale of common stock, net 150,000 1,500 8,125,009 -- 8,134,509
Reclassification to
redeemable common stock -- -- (1,600,000) -- (1,600,000)
- -----------------------------------------------------------------------------------------------------------
Balance, August 31, 1997
(Audited) 150,000 1,500 6,586,948 (70,005) 6,518,104
Subscription paid -- -- (92) -- 9,300
Net income -- -- -- 110,611 110,611
Accretion to redemption
value of common stock -- -- -- (42,725) (42,725)
- -----------------------------------------------------------------------------------------------------------
Balance, February 28, 1998
(Unaudited) 150,000 $ 1,500 $ 6,586,856 $ (2,119) $ 6,595,290
- -----------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 1. Financial Statements
Statements of Cash Flows
(Unaudited)
================================================================================
<TABLE>
<CAPTION>
Period from
Six months ended February 28, September 1, 1995
------------------------------------ (inception) to
1998 1997 February 28, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 110,611 $ (3,846) $ 40,606
Adjustments to reconcile net income (loss) to
net cash used in operating activities:
Amortization of deferred debt costs -- -- 9,800
Amortization of discount on notes
payable -- 3,846 35,000
Changes in assets and liabilities:
Accrued expenses (16,337) -- (72,005)
Interest receivable on investments (163,102) -- (15,003)
- ------------------------------------------------------------------------------------------------------------------------------------
Net cash used in operating
activities (68,828) -- (1,602)
- ------------------------------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
Purchase of treasury securities in escrow (4,157,874) -- (12,156,198)
Sale of treasury securities in escrow 4,106,000 -- 4,104,324
Decrease in cash held in escrow 1,352 -- 1,352
- ------------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in)
investing activities (50,522) (8,050,522)
- ------------------------------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
Proceeds from sale of common stock, net -- -- 8,188,109
Subscription paid 9,300 -- 9,300
Deferred costs:
Registration -- -- 90,000
Debt -- -- (9,800)
Repayment of notes payable (100,000) -- (100,000)
Proceeds from issuance of notes payable -- -- 65,000
- ------------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in)
financing activities (90,700) -- 8,242,609
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash (210,050) -- 190,485
Cash, beginning of period 400,535 25,734 --
- ------------------------------------------------------------------------------------------------------------------------------------
Cash, end of period $ 190,485 $ 25,734 $ 190,485
====================================================================================================================================
Supplemental disclosures for cash flow
information:
Cash paid for:
Interest $ -- $ -- $ --
Taxes -- -- --
====================================================================================================================================
</TABLE>
In fiscal 1996, the Company received a note for subscribed preferred stock
amounting to $9,400, which is a noncash financing activity.
In fiscal 1996, the Company has recorded a $90,000 liability relating to a
license agreement, which is a noncash financing activity.
================================================================================
See accompanying notes to financial statements.
6
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 1. Financial Statements
Notes to Financial Statements
1. Basis of Presentation
The financial statements are presented in accordance with the requirements of
Form 10-Q and Regulation 210 of S-X and consequently do not include all of the
disclosures normally made in an annual Form 10-K filing. Accordingly, the
financial statements included herein should be reviewed in conjunction with the
financial statements and footnotes therein included within the Company's Annual
Report on Form 10-K for the year ended August 31, 1997.
The financial information has been prepared in accordance with the Company's
customary accounting practices and has not been audited. In the opinion of
management, the information presents all adjustments necessary for a fair
statement of interim results. All such adjustments are of a normal and recurring
nature. The foregoing interim results are not necessarily indicative of the
results of operations to be expected for a full year.
2. Investments
The Company has invested the majority of the proceeds from the initial public
offering in United States Treasury Bills. These treasury bills, which were
purchased at a discount, are presented at their accreted cost, which
approximates its market value.
7
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
================================================================================
North Atlantic Acquisition Corp. (the "Company") is a "blank check" or "blind
pool" company which was formed on August 9, 1995 to serve as a vehicle to effect
a merger, exchange of capital stock, asset acquisition or other business
combination (a "Business Combination") with an operating business (a "Target
Business"). The business objective of the Company is to effect a Business
Combination with a Target Business which the Company believes has significant
growth potential. To date, the Company has not effected a Business Combination.
On August 27, 1997 (the "Closing Date"), the Company sold 800,000 units
("Units") in the Offering and 150,000 shares of Class B exchangeable common
stock. Each Unit consists of one share of the Company's Class A common stock and
one Class A redeemable common stock purchase warrant ("Class A Warrant"). Each
Class A Warrant entitles the holder to purchase from the Company one share of
common stock at an exercise price of $9.00; each Class B stock entitles the
holder to receive two Units in exchange 90 days after the date of a Business
Combination. On the Closing Date, the Registrant received net proceeds of
$8,100,000 (the "Net Proceeds"), after giving effect to the payment of all
underwriting discounts, the underwriters' nonaccountable expense allowance and
offering expenses. Pursuant to the terms of the Offering, approximately $8
million of the Net Proceeds, representing an amount equal to the gross proceeds
from the sale of the Units, was placed in escrow with the Chase Manhattan Bank,
N.A., subject to release in accordance with the terms of the Offering. These Net
Proceeds have been invested in United States Treasury Bills and a Treasury Note.
8
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Part II - Other Information
================================================================================
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
Exhibit 27 - Financial Data Schedule
9
<PAGE>
North Atlantic Acquisition Corp.
(formerly Orion Acquisition Corp. I)
(a corporation in the development stage)
Part II - Other Information
================================================================================
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: April 15, 1998 North Atlantic Acquisition Corp.
---------------------------------------------
(Registrant)
By: /s/ David J. Mitchell
-----------------------------------------
David J. Mitchell
Chairman of the Board and
Chief Executive Officer
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-END> FEB-28-1998
<CASH> 190,809
<SECURITIES> 8,213,300
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 8,404,109
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 8,404,109
<CURRENT-LIABILITIES> 166,094
<BONDS> 0
0
93
<COMMON> 10,560
<OTHER-SE> 8,227,362
<TOTAL-LIABILITY-AND-EQUITY> 8,404,109
<SALES> 0
<TOTAL-REVENUES> 213,624
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 103,013
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 110,611
<INCOME-TAX> 0
<INCOME-CONTINUING> 110,611
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 110,611
<EPS-PRIMARY> .12
<EPS-DILUTED> .12
</TABLE>
