<PAGE>
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC.
SUPPLEMENT DATED AUGUST 14, 1998
TO
PROSPECTUS DATED AUGUST 11, 1998
<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------------------------------------------------------
FORM 10-QSB
[x] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File No. 0-24213
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC.
(Name of small business issuer in its charter)
Maryland 52-2097010
- ---------------------------- -----------------------------------
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation)
401 East Pratt Street, 28th Floor, Baltimore, Maryland 21202
-----------------------------------------------------------------
(Address of Principal Executive Office)
Issuer's telephone number, including area code: (410) 625-9656
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, par value $0.001 per share
---------------------------------------------------------
(Title of Class)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act 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 No X
--- ---
As of August 1, 1998, 2,486,543 shares of the registrant's common stock, par
value $0.001 per share, were outstanding.
Transitional Small Business Disclosure Format:Yes No X
--- ---
<PAGE>
TABLE OF CONTENTS
Page
-------
PART I........................................................................
ITEM 1 FINANCIAL STATEMENTS.........................................
ITEM 2 MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS...............
PART II.......................................................................
ITEM 2 CHANGES IN SECURITIES AND USE OF
PROCEEDS....................................................
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS.....................................................
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K.............................
PART I
FINANCIAL INFORMATION
ITEM 1 -- FINANCIAL STATEMENTS
The consolidated financial statements for the three and six
months ended June 30, 1998 have not been audited but, in the opinion of
management, contain all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the financial position and results of
operations of the Company as of such date and for such periods. The unaudited
consolidated financial statements should be read in conjunction with the
Consolidated Financial Statements of the Company and the Notes thereto appearing
in the Company's Registration Statement on Form SB-2. The results of operations
for the three and six months ended June 30, 1998 are not necessarily indicative
of the results of operations that may be expected for the year ending December
31, 1998 or any future periods.
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED CONDENSED BALANCE SHEETS
AS OF DECEMBER 31, 1997, AND JUNE 30, 1998
<TABLE>
<CAPTION>
December 31, June 30,
1997 1998
------------- -------------
(Unaudited)
<S> <C> <C>
ASSETS
Cash ....................................... $ 8,677 $ 58,423
Management fees receivable ................. 253,002 301,980
Receivables from affiliates ................ 35,533 33,488
Advances to officer ........................ 72,000 6,127
Office equipment, net ...................... 5,204 3,204
Prepaids and other assets .................. 8,645 18,199
Intangible assets, net ..................... 693,000 579,000
Investment in affiliate .................... 9,247 10,730
Deferred taxes ............................. -- 66,000
----------- -----------
Total assets ......................... $ 1,085,308 $ 1,077,151
----------- -----------
----------- -----------
LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable and accrued expenses ...... $ 150,997 $ 238,019
Due to affiliated company .................. 800,672 697,384
Due to officer ............................. 28,473 --
Income taxes payable ....................... 48,000 29,608
Noncompete agreement obligation ............ 150,000 150,000
----------- -----------
Total liabilities .................... 1,178,142 1,115,011
----------- -----------
STOCKHOLDERS' DEFICIT:
Common stock, $.001 par value, 20,000,000
shares authorized,
2,486,543 issued and outstanding ..... 2,487 2,487
Accumulated deficit ..................... (95,321) (40,347)
----------- -----------
Total stockholders' deficit ....... (92,834) (37,860)
----------- -----------
Total liabilities and
stockholders' deficit .................. $ 1,085,308 $ 1,077,151
----------- -----------
----------- -----------
</TABLE>
The accompanying notes are an integral part of these consolidated balance sheet.
<PAGE>
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE-MONTHS ENDED JUNE 30, 1997 AND 1998
AND FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1998 1997 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUE:
Advisory and administrative fees ..... $ 534,247 $ 809,010 $ 1,043,299 $ 1,577,963
Other income ......................... 430 1,246 894 4,134
----------- ----------- ----------- -----------
Total revenues ................. 534,677 810,256 1,044,193 1,582,097
----------- ----------- ----------- -----------
OPERATING EXPENSE:
Management fees ...................... 210,979 318,597 411,781 625,500
Compensation and benefits ............ 115,759 165,640 301,261 340,374
General and administrative ........... 178,843 212,255 242,566 392,146
Amortization expense ................. 57,000 57,000 114,000 114,000
Interest expense ..................... 2,130 12,747 9,260 25,495
----------- ----------- ----------- -----------
Total operating expense ........ 564,711 766,239 1,078,868 1,497,515
----------- ----------- ----------- -----------
(Loss) income before income tax
provision (benefit) ......... (30,034) 44,017 (34,675) 84,582
INCOME TAX (BENEFIT) PROVISION .......... (13,600) 15,408 (13,600) 29,608
----------- ----------- ----------- -----------
Net (loss) income .............. $ (16,434) $ 28,609 $ (21,075) $ 54,974
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
BASIC AND DILUTIVE EARNINGS PER
SHARE DATA:
Net (loss) income .................... $ (.01) $ .01 $ (.01) $ .02
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Weighted Average Shares Outstanding .. 2,486,543 2,486,543 2,486,543 2,486,543
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
<PAGE>
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1997 1998
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income .................................... $ (21,075) $ 54,974
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depreciation and amortization ..................... 115,982 116,000
Effect of changes in assets and liabilities-
Management fees receivable ..................... (17,103) (48,978)
Due from affiliates ............................ 1,479 2,045
Advances to officer ............................ (10,000) 65,873
Prepaids and other assets ...................... (26,026) (9,554)
Accounts payable and accrued expenses .......... 163,645 87,022
Income taxes payable ........................... (174,477) (18,392)
Investment in affiliate ........................ -- (1,483)
Deferred tax asset ............................. -- (66,000)
Due to affiliated company ...................... 66,430 (103,288)
--------- ---------
Net cash provided by operating activities ... 98,855 78,219
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of office equipment ......................... (5,250) --
--------- ---------
Net cash used in investing activities ....... (5,250) --
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of due to officer .......................... (70,000) (28,473)
--------- ---------
Net cash used in financing activities ....... (70,000) (28,473)
--------- ---------
NET INCREASE IN CASH .................................... 23,605 49,746
CASH, beginning of period ............................... 8,162 8,677
--------- ---------
CASH, end of period ..................................... $ 31,767 $ 58,423
--------- ---------
--------- ---------
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
<PAGE>
CHAPMAN CAPITAL MANAGEMENT HOLDINGS, INC. AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997, AND JUNE 30, 1998
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Chapman Capital Management Holdings, Inc. is an investment advisory and
investment management company.
Basis of Presentation
The accompanying consolidated financial statements include the accounts of
Chapman Capital Management Holdings, Inc. (CCMH) and its wholly owned
subsidiary, Chapman Capital Management (collectively, the Company). All
significant intercompany accounts and transactions have been eliminated in
consolidation. The accompanying consolidated financial statements are presented
on the accrual basis of accounting in accordance with generally accepted
accounting principles. 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 as of the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The Chapman Co., an affiliated company, pays for routine operating expenses and
provides certain management, data processing, accounting and administrative
services to the Company, for which The Chapman Co. is reimbursed. The Chapman
Co. also pays salary and benefit expenses, which the Company is allocated a
portion. The Chapman Co. allocates those salary and benefit expenses to the
Company based on actual salaries related to the Company. These financial
statements may not necessarily be indicative of the financial results that would
have existed had the Company been operated as an unaffiliated corporation.
Interim Financial Statements
The consolidated financial statements for the three and six months ended June
30, 1997 and 1998, are unaudited, but in the opinion of management, such
financial statements have been presented on the same basis as the audited
consolidated financial statements and include all adjustments, consisting only
of normal recurring adjustments necessary for a fair presentation of the
financial position and results of operations, for the periods.
<PAGE>
As permitted under the applicable rules and regulations of the Securities and
Exchange Commission, these financial statements do not include all
disclosures normally included with audited consolidated financial statements,
and accordingly, should be read in conjunction with the consolidated
financial statements and notes thereto as of December 31, 1997, included in
the Company's Form SB-2 filed. The Company's operating results are
significantly affected by the size of the portfolio it manages. The results
of operations presented in the accompanying consolidated financial statements
are not necessarily representative of operations for an entire year and
because of the nature of the Company's operations can be materially different
between periods.
2. INITIAL PUBLIC OFFERING:
The Company filed a registration statement for an initial public offering in
which it is offering, on a best efforts basis, a minimum of 850,000 shares of
common stock and a maximum of 1,250,000 shares of common stock. The proceeds
of the IPO will be used to expand the Company's sales and marketing efforts,
create new investment products and to provide working capital to support the
planned growth of its business. The registration statement was declared
effective on June 30, 1998 and the company plans to close on the transaction
in the near future.
3. NEW AUTHORITATIVE STANDARDS:
During 1997, the Financial Accounting Standards Board (FASB) issued SFAS No.
130, "Reporting Comprehensive Income" (SFAS No. 130), which is effective for
fiscal years beginning after December 15, 1997. This statement establishes
standards for reporting and display of comprehensive income and its components.
The Company adopted SFAS No. 130 during the six months ended June 30, 1998, and
has determined that the adoption of this statement has no impact on the
financial statements as the Company has no comprehensive income adjustments.
During 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information" (SFAS No. 131), which is effective for
fiscal years beginning after December 15, 1997. This statement establishes a new
approach for determining segments within a company and reporting information on
those segments. The Company has performed a preliminary assessment of this
statement and believes that no disclosure is necessary as the Company has only
one segment.
<PAGE>
ITEM 2--MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Note Regarding Forward-Looking Information
Certain statements under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and elsewhere in this
Report constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company, or industry
results, to be materially different from any future results, performance, or
achievements expressed or implied by such forward-looking statements. Such
factors include, among others, general economic and business conditions in the
Company's market area, inflation, fluctuations in interest rates, changes in
government regulations, competition and the ability of the Company to implement
its business strategy.
Forward-looking statements are intended to apply only at the time
they are made. Moreover, whether or not stated in connection with a
forward-looking statement, the Company undertakes no obligation to correct or
update a forward-looking statement should the Company later become aware that it
is not likely to be achieved. If the Company were to update or correct a
forward-looking statement, investors and others should not conclude that the
Company will make additional updates or corrections thereafter.
The following discussion should be read in conjunction with the
financial statements contained in Item 1 of Part I of this Form 10-QSB.
Results of Operations
The following table reflects items in the Statements of Operations as dollar
amounts and as percentages of total revenue.
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
-------------------------------------- -----------------------------------------
1997 1998 1997 1998
------------------ ----------------- -------------------- ------------------
Percentage of Percentage of Percentage of Percentage of
Total Total Total Total
Amounts Revenue Amounts Revenue Amounts Revenue Amounts Revenue
---------- ------- --------- ------- ----------- -------- ---------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUE:
Advisory and administrative ............ $ 534,247 99.9% $ 809,010 99.8% $ 1,043,299 99.9% $ 1,577,963 99.7%
Other income ........................... 430 0.1% 1,246 0.2% 894 0.1% 4,134 0.3%
---------- ---- --------- --- ----------- ---- ----------- ---
Total revenue ..................... 534,677 100.0% 810,256 100.0% 1,044,193 100.0% 1,582,097 100.0%
---------- ---- --------- --- ----------- ---- ----------- ---
OPERATING EXPENSE:
Management fees ........................ 210,979 39.5% 318,597 39.3% 411,781 39.4% 625,500 39.6%
Compensation and benefits .............. 115,759 21.7% 165,640 20.4% 301,261 28.9% 340,374 21.5%
General and administrative ............. 178,843 33.4% 212,255 26.2% 242,566 23.2% 392,146 24.8%
Amortization expense ................... 57,000 10.7% 57,000 7.0% 114,000 10.9% 114,000 7.2%
Interest expense ....................... 2,130 0.4% 12,747 1.6% 9,260 0.9% 25,495 1.6%
---------- ---- --------- --- ----------- ---- ----------- ---
Total expense ..................... 564,711 105.7% 766,239 94.5% 1,078,868 103.3% 1,497,515 94.7%
---------- ---- --------- --- ----------- ---- ----------- ---
Income (loss) before
income tax provision ............ (30,034) (5.7%) 44,017 5.5% (34,675) (3.3%) 84,582 5.3%
Income tax provision (benefit) ......... (13,600) (2.6%) 15,408 1.9% (13,600) (1.3%) 29,608 1.8%
---------- ---- --------- --- ----------- ---- ----------- ---
Net income (loss) ...................... $ (16,434) (3.1%) $ 28,609 3.6% $ (21,075) (2.0%) $ 54,974 3.5%
---------- ---- --------- --- ----------- ---- ----------- ---
---------- ---- --------- --- ----------- ---- ----------- ---
</TABLE>
Total revenue increased by $275,579, or 51.5%, to $810,256 in the
three months ended June 30, 1998 from $534,677 in the prior comparable period.
Total revenue increased by $537,904, or 51.5%, to $1,582,097 in the six months
ended June 30, 1998 from $1,044,193 in the prior comparable period.
Advisory and administrative fee revenue increased by $274,763, or
51.4%, to $809,010 in the three months ended June 30, 1998 from $534,247 in the
prior comparable period. Advisory and administrative fee revenue increased by
$534,664, or 51.2%, to $1,577,963 in the three months ended June 30, 1998 from
$1,043,299 in the prior comparable period. The increase in advisory and
administrative fee revenue reflects an increase in assets under management due
largely to growth in assets under the DEM-MET Trust and the introduction of the
DEM Equity Fund. As of June 30, 1998, three clients accounted for approximately
77% of the Company's revenue.
Total expense increased by $201,528, or 35.7%, to $766,239 in the
three months ended June 30, 1998 from $564,711 in the prior comparable period.
Total expense increased by $418,647, or 38.8%, to $1,497,515 in the six months
ended June 30, 1998 from $1,078,868 in the prior comparable period. As a
percentage of total revenue, total expense decreased to 94.5% in the three
months ended June 30, 1998 compared to
<PAGE>
105.7% in the prior comparable period. As a percentage of total revenue, total
expense decreased to 94.7% in the six months ended June 30, 1998 compared to
103.3% in the prior comparable period. The decrease in total expense as a
percentage of total revenue is largely a result of the Company's increased
revenues stemming from a corresponding increase in assets under management of
the DEM-MET Trust and the introduction of the DEM Equity Fund, and certain
economies of scale resulting therefrom.
Management fee expense, which consists primarily of the
Company's payments to sub-advisors in connection with its multi-manager
investment product, the DEM-MET Trust, increased by $107,618, or 51.0%, to
$318,597 in the three months ended June 30, 1998 from $210,979 in the prior
comparable period. Management fee expense increased by $213,719, or 51.9% to
$625,500 in the six months ended June 30, 1998 from $411,781 in the prior
comparable period. The Company's increase in management fee expense largely
reflects the increase in assets under management of the DEM-MET Trust and the
corresponding expenses associated therewith.
Compensation and benefits expense increased by $49,881, or 43.1%,
to $165,640 in the three months ended June 30, 1998 from $115,759 in the prior
comparable period. Compensation and benefits expense increased by $39,113, or
13.0%, to $340,374 in the six months ended June 30, 1998 from $301,261 in prior
comparable period. The increase in compensation and benefits is due primarily to
the Company's addition of five new employees and annual pay increases. As a
percentage of total revenue, compensation and benefits expense decreased to
20.4% in the three months ended June 30, 1998 from 21.7% in the prior comparable
period. As a percentage of total revenue, compensation and benefits expense
decreased to 21.5% in the six months ended June 30, 1998 from 28.9% in the prior
comparable period.
General and administrative expense increased by $33,412, or
18.7%, to $212,255 in the three months ended June 30, 1998 from $178,843 in the
prior comparable period. General and administrative expense increased by
$149,580, or 61.7%, to $392,146 in the six months ended June 30, 1998 from
$242,566 in the prior comparable period. The increase in general and
administrative expense is a result of increased advertising and travel expenses
associated with the Company's expanded marketing activities during the period.
As a percentage of total revenue, general and administrative expense decreased
to 26.2% in the three months ended June 30, 1998 from 33.4% in the prior
comparable period. As a percentage of total revenue, general and administrative
expense increased to 24.8% in the six months ended June 30, 1998 from 23.2% in
the prior comparable period.
Interest expense was $12,747, in the three months ended June 30,
1998 compared to $2,130 in the prior comparable period. Interest expense was
$25,495, in the six months ended June 30, 1998 compared to $9,260 in the prior
comparable period. The increase in interest expense is attributable to interest
owed by the Company on a note receivable by an affiliate.
<PAGE>
The Company's income tax provision increased by $29,008 to
$15,408 in the three months ended June 30, 1998 versus a $13,600 tax benefit in
the prior comparable period. The Company's income tax provision increased by
$43,208 to $29,608 in the six months ended June 30, 1998 versus a $13,600 tax
benefit in the prior comparable period. The increase in income tax provision is
due to an increase in the Company's income prior to income taxes during the
period.
Net income increased by $45,043 to $28,609 in the three months
ended June 30, 1998 from a loss of $16,434 in the prior comparable period. Net
income increased by $76,049 to $54,974 in the six months ended June 30, 1998
from a loss of $21,075 in the prior comparable period. The increase in net
income is a result of each of the items discussed above.
Liquidity and Capital Resources
Historically, the Company has financed its operations through
capital contributions from its principal stockholder, loans from affiliates and
cash flow from operations.
A substantial majority of the Company's assets are illiquid
consisting primarily of certain intangibles related to non-competition
agreements and rights and interests in the DEM-MET Trust. The Company's liquid
assets consist primarily of receivables from advisory clients. A relatively
small percentage of the Company's total assets are fixed. The Company's total
assets as of June 30, 1998 were $1,077,151.
The final payment of $150,000 on a non-compete agreement
pertaining to the DEM-MET Trust is due in the third quarter of 1998. Management
expects that the Company's liquid assets and cash provided by operations will be
sufficient to make this payment. As of June 30, 1998, the Company owed $697,384,
pursuant to a note which accrues interest at 6.68% per annum, payable to an
affiliated company, in connection with the expenses incurred by the Company's
introduction of the DEM-MET Trust and a related non-competition agreement.
The Company's overall capital and funding needs are continually
reviewed to ensure that the capital base can support the Company's estimated
needs of its business activities. Based upon these reviews, the Company believes
it will require the increased capital sought in connection with the Company's
proposed initial public offering of its common stock or other alternative
financing in order to fully implement the Company's DEM and DEM Multi-Manager
strategies.
The Company's cash was $58,423 as of June 30, 1998.
Effects Of Inflation
<PAGE>
The Company's assets are to a large extent illiquid in nature and
are not significantly affected by inflation. However, the rate of inflation
affects the Company's expenses, such as employee compensation and occupancy
expenses, which may not be readily recoverable in the prices of services offered
to the Company's customers. To the extent inflation results in rising interest
rates or has adverse effects upon the securities markets, it may adversely
affect the Company's financial position and results of operations.
Year 2000 Software Issue
As the year 2000 approaches, existing application software
programs and operating systems need to be critically reviewed to determine if
they can accommodate information that employs dates after December 31, 1999.
Management is working with its software vendors to prepare the Company for the
year 2000. Based on information currently available, management does not
anticipate that the Company will be required to incur material costs in order to
be year 2000 compliant. The Company is, however, still analyzing and modifying
its systems and requirements. In addition, the Company has relationships with
third parties that have computer systems that may not be year 2000 compliant. To
the extent such third parties' systems are not fully year 2000 compliant, there
can be no assurance that potential systems interruptions or the cost necessary
to update software would not have a material adverse effect on the Company's
business, financial condition, results of operations or business prospects.
PART II
OTHER INFORMATION
ITEM 2--CHANGES IN SECURITIES AND USE OF PROCEEDS
On May 5, 1998, the Company filed a Registration Statement on
Form SB-2 (File No. 333-51883) to register its offering, on a best efforts
basis, of a minimum of 850,000 shares and a maximum of 1,250,000 shares of the
Company's common stock, par value $.001 (the "Offering"). The Company's
Registration Statement was declared effective with the Commission at 5:30 p.m.,
Washington, D.C. time, on June 30, 1998. The Company did not commence its
Offering in this reporting quarter and has not received any proceeds of the
Offering in the quarter covered by this report.
ITEM 4--SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company held its annual meeting of stockholders on April 23,
1998. The following directors of the Company were re-elected at the meeting:
Nathan A. Chapman, Jr., Earl U. Bravo, Sr. and Theron Stokes. In addition to the
election of directors, the Company's stockholders voted at the annual meeting to
ratify and approve the selection of Arthur Andersen LLP as the Company's
independent public accountants and approve
<PAGE>
the Company's 1998 Omnibus Stock Plan. The following chart indicates the number
of shares outstanding on the record date, the number of shares present at the
annual meeting and the number of shares voting in favor of the matters presented
at the annual meeting.
<TABLE>
<CAPTION>
Shares Voting
in Favor of
Shares Outstanding Shares Present Matters
on Record Date at Annual Meeting Proposed
<S> <C> <C> <C>
Common
Stock 1,989,235 1,830,015 1,830,015
</TABLE>
The Company held a special meeting of stockholders on April 27,
1998 for the purpose of amending the Company's Charter to reflect a change in
the Company's name from Chapman Capital Holdings, Inc. to Chapman Capital
Management Holdings, Inc. The following chart indicates the number of shares
outstanding on the record date, the number of shares present at the special
meeting and the number of shares voting in favor of the Charter amendment
presented at the annual meeting.
<TABLE>
<CAPTION>
Shares Voting
in Favor of Charter
Common Shares Outstanding Shares Present at Amendment to
Stock on Record Date Special Meeting Company Name
<S> <C> <C> <C>
1,989,235 1,830,015 1,830,015
</TABLE>
ITEM 6--EXHIBITS AND REPORTS ON FROM 8-K
A. Exhibits required by Item 601 of Regulation S-B:
Exhibit 27: Financial Data Schedule
B. Reports on Form 8-K:
None.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
CHAPMAN CAPITAL
MANAGEMENT HOLDINGS, INC.
By: /s/ NATHAN A. CHAPMAN, JR.
-------------------------------------
Nathan A. Chapman, Jr.
President, Chairman of the Board
and Director
/s/ M. LYNN BALLARD
-------------------------------------
M. Lynn Ballard
Treasurer and Controller
(Principal Financial Officer and
Principal Accounting Officer)
Date: August 14, 1998
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibit
27 Financial Data Schedule
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF THE COMPANY FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
AND JUNE 30, 1998 AND FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1998,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C> <C> <C> <C>
<PERIOD-TYPE> 6-MOS 3-MOS 3-MOS 6-MOS
<FISCAL-YEAR-END> JAN-01-1998 APR-01-1997 APR-01-1998 JAN-01-1997
<PERIOD-END> JUN-30-1998 JUN-30-1997 JUN-30-1998 JUN-30-1997
<CASH> 58,423 0 0 0
<SECURITIES> 0 0 0 0
<RECEIVABLES> 335,468 0 0 0
<ALLOWANCES> 0 0 0 0
<INVENTORY> 0 0 0 0
<CURRENT-ASSETS> 400,018 0 0 0
<PP&E> 9,185 0 0 0
<DEPRECIATION> 5,981 0 0 0
<TOTAL-ASSETS> 1,077,151 0 0 0
<CURRENT-LIABILITIES> 1,115,011 0 0 0
<BONDS> 0 0 0 0
0 0 0 0
0 0 0 0
<COMMON> 2,487 0 0 0
<OTHER-SE> (40,347) 0 0 0
<TOTAL-LIABILITY-AND-EQUITY> 1,077,151 0 0 0
<SALES> 0 534,247 809,010 1,043,299
<TOTAL-REVENUES> 0 534,677 810,256 1,044,193
<CGS> 0 0 0 0
<TOTAL-COSTS> 0 564,711 766,239 1,078,868
<OTHER-EXPENSES> 0 0 0 0
<LOSS-PROVISION> 0 0 0 0
<INTEREST-EXPENSE> 0 2,130 12,747 9,260
<INCOME-PRETAX> 0 (30,034) 44,017 (34,675)
<INCOME-TAX> 0 (13,600) 15,408 (13,600)
<INCOME-CONTINUING> 0 (16,434) 28,609 (21,075)
<DISCONTINUED> 0 0 0 0
<EXTRAORDINARY> 0 0 0 0
<CHANGES> 0 0 0 0
<NET-INCOME> 0 (16,434) 28,609 (21,075)
<EPS-PRIMARY> 0 (0.01) 0.01 (0.01)
<EPS-DILUTED> 0 (0.01) 0.01 (0.01)
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF THE COMPANY FOR THE FISCAL YEARS ENDED DECEMBER 31, 1997
AND JUNE 30, 1998 AND FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1998,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 1,577,963
<TOTAL-REVENUES> 1,582,097
<CGS> 0
<TOTAL-COSTS> 1,497,515
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 25,495
<INCOME-PRETAX> 84,582
<INCOME-TAX> 29,608
<INCOME-CONTINUING> 54,974
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 54,974
<EPS-PRIMARY> 0.02
<EPS-DILUTED> 0.02
</TABLE>
