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 December 31, 1998
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 0-21899
ICON SYSTEMS, INC.
(Exact name of small business issuer as specified in its charter)
Nevada 87-0565018
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4835 North O'Connor, Suite 134-136, Irving, Texas 75062
(Address of principal executive offices)
Registrant's telephone no., including area code: (817) 267-1866
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 December 31, 1998
Common Stock, $.001 par value 26,581,661
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TABLE OF CONTENTS
Heading Page
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements. . . . . . . . . . . . 1
Consolidated Balance Sheets -- December 31, 1998
and June 30, 1998. . . . . . . . . . . . . . . . . . . 2
Consolidated Statements of Operations -- three and
six months ended December 31, 1998 and 1997. . . . . . 3
Consolidated Statements of Stockholders' Equity 4
Consolidated Statements of Cash Flows -- six
months ended December 31, 1998 and 1997. . . . . . . . 8
Notes to Consolidated Financial Statements . . . . . . . 10
Item 2. Management's Discussion and Analysis and
Results of Operations. . . . . . . . . . . . . . . . . 14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . 16
Item 2. Changes In Securities. . . . . . . . . . . . . . . . . . 16
Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . 16
Item 4. Submission of Matters to a Vote of
Securities Holders . . . . . . . . . . . . . . . . . . 17
Item 5. Other Information. . . . . . . . . . . . . . . . . . . . 17
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . 17
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . 18
-i-
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PART I
Item 1. Financial Statements
The following unaudited Financial Statements for the period
ended December 31, 1998, have been prepared by the Icon Systems,
Inc. (the "Company").
ICON SYSTEMS, INC.
CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 and June 30, 1998
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Balance Sheets
ASSETS
December 31, June 30,
1998 1998
(Unaudited)
CURRENT ASSETS
Cash $ 32 $ 4,211
Total Current Assets 32 4,211
TOTAL ASSETS $ 32 $ 4,211
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ - $ -
Notes payable (related party) (Note 2) - 5,000
Total Current Liabilities - 5,000
STOCKHOLDERS' EQUITY
Preferred stock authorized: 10,000,000
preferred shares at $0.001 par value;
-0- outstanding - -
Common stock authorized: 100,000,000
common shares
at $0.001 par value; 16,582,689 shares
issued and outstanding 16,582 16,582
Capital in excess of par value 389,588 383,338
Deficit accumulated during the
development stage (406,138) (400,709)
Total Stockholders' Equity 32 (789)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 32 $ 4,211
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
From
Inception on
August 26,
For the Six Months For the Three Months 1987 Through
Ended December 31, Ended December 31, December 31,
1998 1997 1998 1997 1998
REVENUES $ - $ - $ - $ - $ -
EXPENSES
General and administrative 5,429 11,354 1,491 3,335 61,613
Total Expenses 5,429 11,354 1,491 3,335 61,613
OTHER INCOME (EXPENSES)
Interest income - 197 - 72 640
Interest expense - - - - (700)
Total Other Income (Expenses) - 197 - 72 (60)
Income (Loss) from Continuing
Operations (5,429) (11,157) (1,491) (3,263) (61,673)
Income (Loss) from Discontinued
Operation - - - - (344,465)
NET LOSS $ (5,429) $(11,157) $ (1,491) $ (3,263) $(406,138)
BASIC NET LOSS PER SHARE $ (0.00) $ (0.00) $ (0.00) $ (0.00)
BASIC WEIGHTED AVERAGE
NUMBER OF SHARES 16,582,689 16,582,689 16,582,689 16,582,689
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity
Deficit
Accumulated
Capital in During the
Common Stock Excess of Development
Shares Amount Par Value Stage
Balance at inception on
August 26, 1987 - $ - $ - $ -
Issuance of 36 shares of common
stock to an officer for cash at
$27.78 per share 36 - 1,000 -
Net loss from inception on
August 26, 1987 through
June 30, 1988 - - - (914)
Balance, June 30, 1988 36 - 1,000 (914)
Net loss for the year ended
June 30, 1989 - - - (2,299)
Balance, June 30, 1989 36 - 1,000 (3,213)
Issuance of 195 shares of
common stock for cash at
$16.15 per share 195 - 3,150 -
Issuance of 375 shares of
common stock to shareholder
for office equipment and stock
of Alco Investment Corporation
and cash of $750 at $20.91
per share 375 - 7,840 -
Net loss for the year ended
June 30, 1990 - - - (3,245)
Balance, June 30, 1990 606 $ - $ 11,990 $ (6,458)
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Continued)
Deficit
Accumulated
Capital in During the
Common Stock Excess of Development
Shares Amount Par Value Stage
Balance, June 30, 1990 606 $ - $ 11,990 $ (6,458)
Contribution of non-marketable
securities by officer - - 750 -
Contribution and cancellation of
shares by officer (318) - - -
Issuance of 18 shares for cash
at $111.11 per share 18 - 2,000 -
Issuance of 741 shares of
common stock to shareholder
and 1,500 shares of common
stock to QBC Holding Corp.
for $600 at $0.27 per shar 2,241 2 598 -
Expenses paid on behalf of
the Company by shareholder - - 1,636 -
Net loss for the year ended
June 30, 1991 - - - (10,518)
Balance, June 30, 1991 2,547 2 16,974 (16,976)
Shares contributed to the
Company and canceled by
the shareholders (2,364) (2) 2 -
Purchase of subsidiary for the
issuance of 37,707 shares of
common stock at approximately
$8.37 per share 37,707 38 315,451 -
Net loss for the year ended
June 30, 1992 - - - (276,103)
Balance, June 30, 1992 37,890 $ 38 $ 332,427 $ (293,079)
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Continued)
Deficit
Accumulated
Capital in During the
Common Stock Excess of Development
Shares Amount Par Value Stage
Balance, June 30, 1992 37,890 $ 38 $ 332,427 $ (293,079)
Net loss for the year ended
June 30, 1993 - - - (39,386)
Balance, June 30, 1993 37,890 38 332,427 (332,465)
Net loss for the year ended
June 30, 1994 - - - -
Balance, June 30, 1994 37,890 38 332,427 (332,465)
Net loss for the year ended
June 30, 1995 - - - -
Balance, June 30, 1995 37,890 38 332,427 (332,465)
Issuance of 44,799 shares of
common stock for services
rendered valued at approximately
$0.27 per share 44,799 44 11,956 -
Net loss for the year ended
June 30, 1996 - - - (12,000)
Balance, June 30, 1996 82,689 $ 82 $ 344,383 $(344,465)
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Continued)
Deficit
Accumulated
Capital in During the
Common Stock Excess of Development
Shares Amount Par Value Stage
Balance, June 30, 1996 82,689 $ 82 $ 344,383 $(344,465)
Issuance of 9,000,000 shares
of common stock for cash
at $0.0011 per share 9,000,000 9,000 1,000 -
Issuance of 6,000,000 shares of
common stock for services
rendered valued at $0.0011
per share 6,000,000 6,000 600 -
Issuance of 1,500,000 shares
of common stock for
compensation at approximately
$0.0067 per share 1,500,000 1,500 8,500 -
Contributed capital - - 28,855 -
Net loss for the year ended
June 30, 1997 - - - (41,819)
Balance, June 30, 1997 16,582,689 16,582 383,338 (386,284)
Net loss for the year ended
June 30, 1998 - - - (14,425)
Balance, June 30, 1998 16,582,689 16,582 383,338 (400,709)
Contributed capital (unaudited) - - 6,250 -
Net loss for the six months
ended December 31, 1998
(unaudited) - - - (5,429)
Balance, December 31, 1998
(unaudited) 16,582,689 $ 16,582 $ 389,588 $(406,138)
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
Inception on
August 26,
For the Six Months For the Three Months 1987 Through
Ended December 31, Ended December 31, December 31,
1998 1997 1998 1997 1998
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net loss $(5,429) $(11,157) $(1,491) $(3,263) $(406,138)
Adjustments to reconcile net
income (loss) to net cash
provided (used) by
operating activities:
Depreciation - - - - 59,907
Stock issued for services - - - - 28,600
Loss on disposition of assets - - - - 9,352
Changes in operating asset and
liability accounts:
Increase (decrease) in accounts
payable - (628) (1,933) - -
Contributed capital 6,250 - 6,250 - 35,105
Cash Provided (Used) by
Operating Activities 821 (11,785) 2,826 (3,263) (273,174)
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of equipment - - - - (13,368)
Sale of equipment - - - - 7,090
Cash Provided (Used) by
Investing Activities - - - - (6,278)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from notes payable - - - - 165,000
Payment on notes payable - - - - (53,764)
Payment of loan from officer (5,000) - (5,000) - (66,884)
Issuance of common stock - - - - 158,382
Proceeds of loan from officer - - - - 76,750
Cash Provided (Used) by
Financing Activities $(5,000) $ - $(5,000) $ - 279,484
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Statements of Cash Flows (Continued)
(Unaudited)
From
Inception on
August 26,
For the Six Months For the Three Months 1987 Through
Ended December 31, Ended December 31, December 31,
1998 1997 1998 1997 1998
NET INCREASE (DECREASE) IN CASH $(4,179) $(11,785) $(2,174) $(3,263) $ 32
CASH AT BEGINNING OF PERIOD 4,211 14,264 2,206 5,742 -
CASH AT END OF PERIOD $ 32 $ 2,479 $ 32 $ 2,479 $ 32
Cash Payments For:
Income taxes $ - $ - $ - $ - $ -
Interest $ - $ - $ - $ - $ -
Non Cash Financing Activities:
Stock issued for services $ - $ - $ - $ - $ 28,600
Stock issued for equipment $ - $ - $ - $ - $ 7,214
Stock issued for subsidiary $ - $ - $ - $ - $315,489
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1998 and 1997
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The financial statements presented are those of Icon
Systems, Inc. The Company was incorporated as Loki Holding
Corporation under the laws of the State of Utah on August
26, 1987 and on August 4, 1988 changed its name to Quazon
Investment Corporation. On April 15, 1988 the Company
became a wholly-owned subsidiary of Loki Holding
Corporation (formerly Dynamic Video, Inc.). On May 25,
1990 the Company was "spun off" in a partial liquidating
dividend. In June of 1990 the Company acquired Alco
Investment Corporation. On January 7, 1991 the Company
sold Alco Investment Corporation to a company owned by a
major shareholder. On August 15, 1991 the Company acquired
all of the shares of Tompkins Environmental Corporation
(Tompkins) in exchange for 10,000,000 pre-split shares of
the Company's authorized but previously unissued common
stock (See Note 2). The Company's name was changed to
Tompkins Environmental Corporation. The Company was
engaged in disaster cleanup operations. On October 25,
1995, Tompkins was involuntarily dissolved and abandoned.
All operations associated with Tompkins have been accounted
for as discontinued operations. On September 24, 1996, the
Company changed its name to Icon Systems, Inc. and changed
its State of incorporation to Nevada.
Currently the Company is seeking new business opportunities
believed to hold a potential profit or to merge with an
existing company.
b. Accounting Method
The Company's financial statements are prepared using the
accrual method of accounting. The Company has adopted a
June 30 year end.
c. Basic Net Loss Per Share
The computations of basic net loss per share of common
stock are based on the weighted average number of shares
issued and outstanding at the date of the financial
statements.
d. Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires
management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date
of the financial statement and the reported amounts of
revenues and expenses during the reporting period. Actual
results could differ from those estimates.
e. Cash Equivalents
The Company considers all highly liquid investments with a
maturity of three months or less when purchased to be cash
equivalents.
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1998 and 1997
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Provision for Taxes
At September 30, 1998, the Company had net operating loss
carryforwards of approximately $405,000 that may be offset
against future taxable income through 2013. No tax benefit
has been reported in the financial statements, because the
potential tax benefits of the net operating loss
carryforwards are offset by a valuation allowance of the
same amount.
g. Unaudited Financial Statements
The accompanying unaudited financial statements include all
of the adjustments which, in the opinion of management, are
necessary for a fair presentation. Such adjustments are of
a normal recurring nature.
NOTE 2 - RELATED PARTY TRANSACTIONS
On June 24, 1998, a shareholder loaned the Company $5,000
to cover operating expenses. The note bears no interest
and is due on demand. In December 1998, the shareholder
contributed the $5,000 note payable and an additional
$1,250 to the capital of the Company.
In January of 1997, the president of the Company
contributed $28,155 to the Company for future working
capital.
In October, 1996, a shareholder loaned the Company $10,000
to cover operating expenses. The note bore 10% interest
and was repaid in June of 1997. The total accrued interest
of $700 was forgiven by the shareholder.
On October 10, 1996, the Company issued 6,000,000 post-
split shares of restricted common stock to officers and
directors of the Company for services valued at $0.0033 per
share.
On September 14, 1996, the Company issued 9,000,000 post-
split shares of restricted common stock for cash to a
company owned by an officer for total consideration of
$10,000.
On October 24, 1995, the Company issued 44,799 to officers
and directors of the Company for services rendered valued
at $0.27 per share (See Note 5).
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1998 and 1997
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using
generally accepted accounting principles applicable to a
going concern which contemplates the realization of assets
and liquidation of liabilities in the normal course of
business. However, the Company does not have significant
cash or other material assets, nor does it have an
established source of revenues sufficient to cover its
operating costs and to allow it to continue as a going
concern. It is the intent of the Company to seek a merger
with an existing, operating company. In the interim,
shareholders of the Company have committed to meeting its
minimal operating expenses.
NOTE 4 - REVERSE STOCK SPLIT
On September 14, 1996, the board of directors of the
Company approved a 1-for-1,000 reverse stock split while
retaining the authorized shares at 100,000,000 and
retaining the par value at $0.001. This change has been
applied to the financial statements on a retroactive basis
back to inception. The Company provided that no
shareholder would be reduced below 50 shares, accordingly,
5,413 post-split fractional shares were issued. These
shares have been allocated pro-rata to previous stock
issuances.
NOTE 5 - ISSUANCES OF COMMON STOCK
At the Company's inception, the Board of Directors
authorized the issuance of 36 restricted shares of its
common stock to an executive officer who may be deemed to
have been a promoter or founder of the Company for the
total consideration of $1,000.
On September 27, 1989, the Company became authorized to do
business in the State of Utah as Quazon International
Corporation and changed its business purpose to consulting
in mergers and acquisitions. On September 28, 1989 the
Company issued 195 shares of restricted common stock for
$3,150 cash.
In June of 1990 the Company issued 375 shares of common
stock to an officer for equipment recorded at its
depreciated cost of $7,090 and cash of $750. On September
28, 1990 the officer contributed back to the Company 318
shares.
In September of 1990 the Company issued 18 shares of
restricted common stock to a shareholder for $2,000 in
cash.
In January of 1991 the Company issued 741 shares of
restricted common stock to a shareholder for $600 in cash,
and 1,500 shares of restricted common stock to QBC Holding
Corp. which were recorded at predecessor cost of $-0-.
In the year ended 1992 a shareholder contributed back to
the Company 2,364 shares of restricted common stock.
On August 15, 1991 the Company issued 37,707 shares of
restricted common stock valued at predecessor cost of $8.37
per share for the purchase of Tompkins Environmental
Corporation.
<PAGE>
ICON SYSTEMS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1998 and 1997
NOTE 5 - ISSUANCES OF COMMON STOCK (Continued)
On October 24, 1995, the Company issued 44,799 shares of
restricted common stock for services rendered valued at
$12,000.
On September 14, 1996, the Company issued 9,000,000 shares
of restricted common stock for cash of $10,000.
On October 10, 1996, the Company issued 6,000,000 shares of
restricted common stock for services rendered valued at
$6,600.
On June 2, 1997, the Company issued 1,500,000 shares of its
common stock for compensation valued at $10,000.
NOTE 6 - FORWARD STOCK SPLIT
On July 14, 1997, the shareholders of the Company approved
a 1-for-3 forward stock split while retaining the
authorized shares at 100,000,000 and the par value at
$0.001. The change has been applied to the financial
statements on a retroactive basis back to inception.
NOTE 7 - SUBSEQUENT EVENT
In January 1999, the Company acquired 100% of Prospero
Investments Limited (Prospero), a United Kingdom company.
Prospero is a clothing manufacturer and supplier located in
England. In connection with the acquisition, the Company
effected a 1 share for 50 shares reverse stock split.
thereafter, the Company issued 5,100,000 shares of its
post-split common stock for all of the shares of Prospero.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation
Plan of Operation
The Company has not engaged in any material operations since
its inception or during the quarterly period ended December 31,
1998. During this period, the Company had no revenues, total
expenses were $5,429 and net loss totaled $5,429.
On December 22, 1998 the Company entered into an Acquisition
Agreement and Plan of Reorganization with Prospero Investments
Limited, a United Kingdom company ("Prospero"), and the
shareholders of Prospero. Under the terms of the acquisition, the
Company acquired 100% of the issued and outstanding capital stock
of Prospero in exchange for 5,100,000 shares of the Company's
authorized but previously unissued common stock, post-split as set
forth below. The acquisition was completed in January 1999. The
5,100,000 shares (post-split) are to be issued to the shareholders
of Prospero in exchange for all of their Prospero shares. The financial
statements included in this report do not reflect the acquisition of Prospero.
In connection with the acquisition, the Company effected on
December 28, 1998 a reverse stock split of its issued and
outstanding shares of common stock on a one (1) share for fifty
(50) shares basis.
Prospero is the owner of SR Gent PLC ("SR Gent"), a clothing
manufacturer and supplier located in Barnsley, South Yorkshire,
England. Following the acquisition, the business of SR Gent will
become the principal business of the Company.
Prospero, through its subsidiary SR Gent, designs,
manufactures and distributes apparel for women and children.
SR Gent has been engaged in fashion design and apparel
manufacturing for more than fifty years and is a major supplier of
ladieswear and childrenswear to Marks & Spencer. SR Gent employs
an experienced design team in London that creates ladies formal
blouses, ladies tops, sportswear and girlswear. SR Gent also
manufactures and markets formal skirts, trousers, boyswear and
babywear.
As a result of the exchange, the former Prospero shareholders
will have effective voting control of the Company. Also, the
Company's former Board of Directors has resigned and have been
replaced by persons associated with Prospero and SR Gent. The new
directors will hold office until the Company's next annual meeting,
which is expected to be held in May 1999, or until their successors
are elected or appointed and qualified, or their prior resignation
or termination.
As a result of the acquisition, the Company has become engaged
in the clothing manufacturing and distribution business. During
the next twelve months, the Company will endeavor to develop and
expand its operation and the market for its products. The Company
is also presently investigating the possibility of making
additional acquisitions. The Company is interested in acquiring
additional companies in the clothing and textile business which
management believes to be undervalued in the current economic
environment. The Company may acquire private companies or
interests in publicly traded companies. Such interest may be
minority ownership interests.
Year 2000
Year 2000 issues may arise if computer programs have been written using
two digits (rather than four) to define the applicable year. In such case,
programs that have time-sensitive logic may recognize a date using "00" as
the year 1900 rather than the year 2000, which could
result in miscalculations or system failures.
Prior to its recent acquisitions, the Company did not believe that it
had Year 2000 issues. However, because of its recent acquisitions of
operating businesses, the Company must reassess its position. Because its
acquisitions have just recently been completed, the Company has not
had sufficient time to assess potential issues or problems, or make
a determination as to the possible cost to the Company to become
Year 2000 compliant, if necessary. Also, the Company had not yet
made a determination whether Year 2000 issues could lead to accounting
problems, business interruption and loss of revenues. As of
December 31, 1998, the Company has not incurred any costs related to
addressing the Year 2000 issue. The Company intends to begin a
thorough review of its business operations and existing computer
systems and software to determine whether it may need to upgrade
or replace its existing systems to mitigate Year 2000 issues.
Until such a review has been completed, the Company is unable to
determine whether it will have material issues or whether it will
be required to make material expenditures to upgrade or replace its
computers systems and software.
The Company is also aware that it may have to implement a
contingency plan in the event a problem arises. However, the
Company will not decide whether a contingency plan is necessary
until such time as it has had ample time and opportunity to
investigate and review its present systems and determine whether
a potential problem exists. The Company must also determine
whether third parties with whom it has material relationships
will be materially affected by the Year 2000 issues. Problems
with third parties could also present the Company with material
risks and potential loss of revenue. The Company has not yet
had the opportunity to investigate whether third parties with
whom it transacts business may have any year 2000 issues.
Risk Factors and Cautionary Statements
Forward-looking statements in this report are made pursuant to
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. The Company wishes to advise readers that actual
results may differ substantially from such forward-looking statements.
Forward-looking statements involve risks and uncertainties that could
cause actual results to differ materially from those expressed in or
implied by the statements, including, but not limited to, the following:
Changing economic conditions, interest rate trends, acceptance of the
Company's products in the marketplace, competitive factors, potential
success of the Company's acquired businesses, economic developments
and other risks detailed in the Company's periodic report filings
with the Securities and Exchange Commission.
In the opinion of management, inflation has not had a material
effect on the operations of the Company.
PART II
Item 1. Legal Proceedings
There are presently no other material pending legal
proceedings to which the Company or any of its subsidiaries is a
party or to which any of its property is subject and, to the best
of its knowledge, no such actions against the Company are
contemplated or threatened.
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
In addition to the acquisition of Prospero, the Company
recently acquired a forty percent (40%) interest in Coastal Group
Limited ("Coastal"), a South African company based in Durban,
South Africa. The Company acquired the interest in Coastal by
acquiring Multikarsa Investama, an private Indonesian company
that holds the 40% interest in Coastal, in exchange for 5,400,000
shares (post-split) of the Company's common stock. Coastal's
securities are listed on the Johannesburg Stock Exchange and is a
manufacturer of fashion oriented textile apparel fabrics in South
Africa. The Company has not made a commitment to acquire a
controlling interest in Coastal.
The Company has also recently acquired an aggregate 15.3%
interest in PT Super Mitory Utama ("PTSM"), an Indonesian
company, by acquiring a 100% interest in two private companies,
Chemech (HK) Ltd, an Indonesian company and New World Synthetic
Limited, a British Virgin Islands company, for an aggregate of
1,300,000 shares (post-split) of the Company's common stock.
These two entities hold the 15.3% interest in PTSM. PTSM is an
export-oriented sports shoe producer in Indonesia, located in
Sidoarjo, East Java. PTSM's securities are traded on the Jakarta
and Surabaya stock exchanges. The Company has not made a
commitment to acquire an additional interest in PTSM.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27 - Financial Data Schedules
(b) Reports on Form 8-K
On January 8, 1999 a report on Form 8-K was filed by the
Company reporting under Items 1 and 2 the acquisition of
Prospero Investments Limited.
<PAGE>
SIGNATURES
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.
ICON SYSTEMS, INC.
Date: February 23, 1999 By /S/ Vasudevan Ravi Shankar
VASUDEVAN RAVI SHANKAR,
President and Director
Date: February 23, 1999 By /S/ M.K. Suresh
M. K. SURESH, Secretary,
Treasurer, Chief
Financial Officer and
Director
(Principal Accounting
Officer)
Date: February 23, 1999 By /S/ G.G. Sridharan
G. G. Sridharan, Secretary,
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION
EXTRACTED FROM THE ICON SYSTEMS, INC. FINANCIAL
STATEMENTS FOR THE PERIOD ENDED DECEMBER 31, 1998
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-START> JUL-1-1998
<PERIOD-END> DEC-31-1998
<CASH> 32
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 32
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 32
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 16,582
<OTHER-SE> 389,588
<TOTAL-LIABILITY-AND-EQUITY> 32
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 5,429
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5,429)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,429)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,429)
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
