<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Quarter Ended June 30, 2000
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _____ to _____
Commission file number: 0-30166
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CONMAT TECHNOLOGIES, INC.
-------------------------
(Exact name of small business issuer as specified in its charter)
Florida 23-2999072
------- ----------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
Franklin Avenue and Grant Street, Phoenixville, PA 19460
--------------------------------------------------------
(Address of Principal Executive Offices)
(610) 935-0225
--------------
(Registrant's telephone number, including area code)
Indicate by check mark 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 [ ]
Transitional Small Business Format: YES [ ] NO [X]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
Common Stock, $0.001 par value, outstanding on August 1, 2000: 2,541,666 shares
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Consolidated Balance Sheets as of
June 30, 2000 and December 31, 1999 3
Consolidated Statements of Operations for the
Three and Six Month Periods Ended June 30, 2000
and 1999 4
Consolidated Statements of Cash Flows for the
Six Month Periods Ended June 30, 2000 and 1999 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities and Use of Proceeds 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES
</TABLE>
2
<PAGE>
ConMat Technologies, Inc. and Subsidiary
Consolidated Balance Sheets
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 2000 1999
(unaudited)
------------ -------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 112,828 $ 101,592
Accounts receivable - net 3,874,888 4,569,426
Inventories 1,477,851 1,275,042
Prepaid expenses 94,550 58,341
------------ -------------
Total Current Assets 5,560,117 6,004,401
Property, Plan & Equipment - net 1,078,524 1,010,748
Deferred Income Taxes 78,493 78,493
Other Assets 269,337 264,696
------------ -------------
Total Assets $ 6,986,471 $ 7,358,338
============ =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Line of credit $ 1,385,005 $ 2,127,628
Current portion of long-term debt 526,967 444,641
Current portion of capital lease obligations 87,409 95,461
Accounts payable 2,244,097 1,722,364
Accrued expenses 457,990 447,778
------------ -------------
Total Current Liabilities 4,701,468 4,837,872
Long-Term Debt 2,552,687 2,775,771
Obligations Under Capital Leases 48,069 86,625
Other Liabilities 176,235 176,900
------------ -------------
Total Liabilities 7,478,459 7,877,168
Series B Preferred Stock - $.001 par value, 166,667 shares
issued and outstanding 500,000 500,000
Stockholders' Equity (Deficiency):
Series A preferred stock - $.001 par value, 10,000,000
shares authorized, 735,000 and 1,073,000 shares issued
and outstanding 735 1,073
Series C preferred stock - $.001 par value, 382,500
shares authorized, issued and outstanding 383 0
Common stock - $.001 par value, 40,000,000 shares
authorized 2,551,666 and 2,250,000 shares issued and
outstanding 2,552 2,250
Additional paid-in capital (693,924) (666,986)
Accumulated deficit (251,734) (305,167)
Less: Note receivable for shares sold (50,000) (50,000)
------------ -------------
Total Stockholders' Deficiency (991,988) (1,018,830)
------------ -------------
Total Liabilities and Stockholders' Deficiency $ 6,986,471 $ 7,358,338
============ =============
</TABLE>
See notes to consolidated financial statements
3
<PAGE>
ConMat Technologies, Inc. and Subsidiary
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net Sales to Customers $ 2,890,232 $ 2,916,156 $ 6,030,094 $ 5,993,022
Cost of Goods Sold 2,164,379 2,032,889 4,482,757 4,376,827
------------ ------------ ------------ ------------
Gross Profit 725,853 883,267 1,547,337 1,616,195
Selling, General and Administrative Expenses 486,350 601,737 1,073,697 1,129,215
Corporate Expenses 98,737 55,788 199,806 118,542
------------ ------------ ------------ ------------
Operating Income 140,766 225,742 273,834 368,438
Other Income (Expense):
Interest expense (124,195) (141,902) (255,829) (244,031)
Rental income 62,045 48,507 125,624 96,874
------------ ------------ ------------ ------------
Income Before Tax Expense 78,616 132,347 143,629 221,281
Income Tax Expense 38,500 48,100 70,200 80,300
------------ ------------ ------------ ------------
Net Income $ 40,116 $ 84,247 $ 73,429 $ 140,981
============ ============ ============ ============
Net earnings per Common Share:
Basic $ 0.01 $ 0.03 $ 0.02 $ 0.05
============ ============ ============ ============
Diluted $ 0.01 $ 0.02 $ 0.02 $ 0.04
============ ============ ============ ============
Weighted Average number of Common
Shares Outstanding:
Basic 2,506,111 2,250,000 2,365,555 2,250,000
============ ============ ============ ============
Diluted 3,295,629 3,653,133 3,258,962 3,653,133
============ ============ ============ ============
</TABLE>
See notes to consolidated financial statements
4
<PAGE>
ConMat Technologies, Inc. and Subsidiary
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
2000 1999
----------- ------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net earnings $ 73,429 $ 140,981
Adjustments to reconcile to net cash provided by (used in)
operating activities:
Depreciation and amortization 128,888 140,645
Changes in assets and liabilities:
(Increase) decrease in assets
Accounts receivable 694,538 (2,001,349)
Inventories (202,804) 154,790
Prepaid expenses (36,206) 83,893
Other assets (25,692) (38,903)
Increase (decrease) in liabilities
Accounts payable 521,734 511,019
Accrued expenses (10,457) (231,898)
----------- ------------
Net Cash Provided By (Used In) Operating Activities 1,143,430 (1,240,822)
Cash Flows from Investing Activities:
Purchase of property and equipment (175,613) (37,084)
----------- ------------
Net Cash Used in Investing Activities (175,613) (37,084)
Cash Flows from Financing Activities:
Net borrowings (repayments) under lines of credit (742,623) 1,675,416
Repayment of term notes (140,758) (312,629)
Repayments of capital lease obligations (46,609) (57,100)
Proceeds from sale of common stock 17,500 0
Proceeds from capital lease obligations 0 45,000
Offering costs associated with Series C preferred stock (34,091) 0
Recapitalization costs 0 (32,505)
Payments of Series B preferred stock (10,000) (2,444)
----------- ------------
Net Cash (Used In) Provided By Financing Activities (956,581) 1,315,738
Net Increase in Cash & Cash Equivalents 11,236 37,832
Cash and Cash Equivalents at Beginning of Period 101,592 29,430
----------- ------------
Cash and Cash Equivalents at End of Period $ 112,828 $ 67,262
=========== ============
Supplemental Cash Flow Information:
Cash paid for interest $ 255,829 $ 244,031
=========== ============
Supplemental Disclosure of Non-Cash Investing and Financial Activities
Issuance of Series C preferred stock in exchange redemption of
Series A preferred stock and common stock:
Issued:
Series C preferred stock 383 0
Additional paid-in capital 1,199,097 0
Redeemed:
Series A. preferred stock (285) 0
Common stock (75) 0
Additional paid-in capital (1,199,120) 0
Conversion of 53,333 shares of Series A preferred stock to 53,333
shares of Common Stock
Common Stock 53 0
Series A Preferred Stock (53) 0
Conversion of 313,333 shares of Series A Preferred Stock to 313,333
shares of Common Stock
Common Stock 314 0
Additional paid-in capital (314) 0
</TABLE>
See notes to consolidated financial statements
5
<PAGE>
ConMat Technologies, Inc. and Subsidiary
NOTES TO FINANCIAL STATEMENTS
NOTE A - INTERIM FINANCIAL INFORMATION
The financial statements of ConMat Technologies, Inc. as of June 30,
2000, and for the three and six months ended June 30, 2000 and 1999 and related
footnote information are unaudited. All adjustments (consisting only of normal
recurring adjustments) have been made which, in the opinion of management, are
necessary for a fair presentation. Results of operations for the three and six
months ended June 30, 2000 are not necessarily indicative of the results that
may be expected for any future period. The balance sheet at December 31, 1999
was derived from audited financial statements.
NOTE B - CHANGES IN SECURITIES
On February 29, 2000, pursuant to an Exchange Agreement between ConMat
and Odyssey Capital Group, L. P., ConMat issued 382,500 shares of ConMat Series
C Preferred Stock and a warrant to purchase 382,500 shares of ConMat common
stock to Odyssey in exchange for 285,000 shares of ConMat Series A Preferred
Stock and 75,000 shares of ConMat common stock which were owned by Odyssey. As
additional consideration to ConMat, Odyssey agreed to provide, subject to
ConMat's financial performance, additional financing of $1,500,000 to ConMat in
the future by purchasing subordinated notes with attached warrants or
convertible preferred stock. Odyssey also agreed to assist ConMat in obtaining
additional financing to the extent ConMat's growth or acquisitions require such.
NOTE C - EARNINGS (LOSS) PER SHARE
ConMat reports earnings per share in accordance with the provisions of
SFAS NO. 128, Earnings Per Share. SFAS No. 128 requires presentation of basic
and diluted earnings per share in conjunction with the disclosure of the
methodology used in computing such earnings per share. Basic earnings per share
excludes dilution and is computed by dividing income available to common
shareholders by the weighted average common shares outstanding during the
period. Diluted earnings per share takes into account the potential dilution
that could occur if securities or other contracts to issue common stock were
exercised and converted into common stock.
The following are basic and diluted earnings per share calculations for the
periods presented.
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
Earnings per Share - Basic:
Net income $ 40,116 $ 84,247 $ 73,429 $ 140,981
Dividends on preferred shares (10,000) (10,000) (20,000) (20,000)
------------- ------------- ------------ -------------
Income on common shares $ 30,116 $ 74,247 $ 53,429 $ 120,981
============= ============= ============ =============
Weighted average shares outstanding 2,506,111 2,250,000 2,365,555 2,250,000
============= ============= ============ =============
Basic Earnings Per Share $ 0.01 $ 0.03 $ 0.02 $ 0.05
============= ============= ============ =============
Earnings per Share - Diluted:
Income on common shares $ 30,116 $ 74,247 $ 53,429 $ 120,981
Dividends on preferred shares 10,000 10,000 20,000 20,000
------------- ------------- ------------ -------------
Income on common shares after assumed
conversions $ 40,116 $ 84,247 $ 73,429 $ 140,981
============= ============= ============ =============
Weighted average shares outstanding 2,506,111 2,250,000 2,365,555 2,225,000
Dilutive effect on preferred stock 770,555 1,386,313 874,444 1,386,313
Dilutive effect of stock options and warrants 18,963 16,820 18,963 16,820
------------- ------------- ------------ -------------
Diluted average shares outstanding 3,295,629 3,653,133 3,258,962 3,653,133
============= ============= ============ =============
Diluted Earnings Per Share $ 0.01 $ 0.02 $ 0.02 $ 0.04
============= ============= ============ =============
</TABLE>
6
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
FORWARD LOOKING STATEMENTS
Some of the statements contained in this report discuss future
expectations, contain projections of results of operations or financial
condition or state other "forward-looking" information. Those statements are
subject to known and unknown risks, uncertainties and other factors that could
cause the actual results to differ materially from those contemplated by the
statements. The forward-looking information is based on various factors and was
derived using numerous assumptions.
Important factors that may cause actual results to differ from
projections include, for example:
o general economic conditions, including their impact on capital
expenditures;
o business conditions in the materials technology and wastewater
treatment industries;
o the regulatory environment;
o rapidly changing technology and evolving industry standards;
o new products and services offered by competitors; and
o price pressures.
In addition, in this report, the words "believe," "may," "will,"
"estimate," "continue," "anticipate," "intend," "expect," "plan," and similar
expressions, as they relate to the business or management of ConMat
Technologies, Inc. or its wholly-owned subsidiary, Polychem Corporation, are
intended to identify forward-looking statements.
ConMat undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise after the date of this report. In light of these risks and
uncertainties, the forward-looking events and circumstances discussed in this
report may not occur and actual results could differ materially from those
anticipated or implied in the forward- looking statements.
Results of Operations
Three Month Periods Ended June 30, 2000 and 1999
The following table sets forth certain statement of operation items as
a percentage of net sales for the periods indicated:
Three Months Ended June 30,
---------------------------
2000 1999
---- ----
Net Sales 100.0% 100.0%
Cost of Goods Sold 74.9 69.7
Gross Profit 25.1 30.3
Selling and Administration 16.8 20.6
Interest Expense 4.3 4.9
Other Expense 1.3 0.2
Income Tax Expense 1.3 1.6
----- -----
Net Income 1.4% 2.9%
===== =====
7
<PAGE>
Cost of goods sold is determined as the sum of material costs, direct
manufacturing labor costs and an allocation of utilities and other overhead
costs attributable to manufacturing activities.
Total revenues remained relatively constant with a slight decrease of
$26,000 or .9% to $2,890,232 for the three months ended June 30, 2000 from
$2,916,000 for the three months ended June 30, 1999. Polychem ended the second
quarter of 2000 with an order backlog of $6,947,000 compared to $6,442,000 at
the end of the comparable quarter in 1999, an increase of 7.8%.
Gross profit decreased by $157,000 or 17.8% to $726,000 for the three
month period ended June 30, 2000 from $883,000 for the comparable quarter in
1999. Gross profit decreased as a percentage of sales to 25.1% for the three
month period ended June 30, 2000 from 30.3% for the comparable quarter in 1999.
Polychem's cost of good sold as a percentage of sales increased from 69.7% in
1999's second quarter to 74.9% in the second quarter in 2000. This increase is
the result of increased direct labor cost as a result of a labor agreement
signed last year and the associated overhead as well as the addition of product
design support personnel. However, increases in these areas were offset by
continued gains in the areas of improved plant capacity utilization, increased
plant mechanization through new equipment purchases and other cost saving
measures implemented by management. An aggressive procurement program was
initiated during the second quarter of 2000 which management anticipates will
result in cost savings of approximately $30,000 over the remainder of the year.
Selling and administrative expenses decreased by $115,000 or 19.2% to
$486,000 for the three month period ended June 30, 2000 from $602,000 for the
comparable quarter in 1999. As a percentage of revenues, selling and
administrative expenses decreased to 16.8% for the three month period ended June
30, 2000 from 20.6% of total revenues for the comparable quarter in 1999. This
decrease is primarily attributable to a reduction of administrative employees
during the second quarter of 2000 which was slightly offset by an increase in
expenses associated with the development of ConMat's E-business platform and
the costs associated with ConMat's reporting obligations as a public company.
Management is closely monitoring selling and administrative expenses
and expects such expenses to decrease as a percentage of sales in future periods
due to the discontinuance of one-time costs and expected increased revenues due
to the realization of benefits from expenditures made in late 1997 and early
1998 in an effort to increase Polychem's global sales focus, including the
hiring of additional sales personnel. As the efforts of Polychem's global sales
force progress, Polychem anticipates increased revenues coupled with appropriate
increases in selling and administrative expenses.
Interest expense for the three month period ended June 30, 2000
decreased $18,000 or 12.4 %, to $124,000 from $142,000 for the comparable
quarter in 1999. The lower expense reflects ConMat's collection of a large
receivable that had been outstanding for over 120 days and an effort to extend
payment terms with many of the Company's trade vendors. Interest expense as a
percentage of total revenues decreased to 4.3% in the three month period ended
June 30, 2000 compared to 4.9% in the comparable quarter in 1999. Other expenses
for the quarter ended June 30, 2000 also increased from the comparable period in
the prior year earlier period due to increased corporate related expenses.
ConMat realized a profit of $40,000 for the three month period ended
June 30, 2000. For the comparable quarter in 1999, ConMat experienced a profit
of $84,000. As a percentage of net revenues, net income decreased from 2.9% for
the three months ended June 30, 1999 to 1.4% for the quarter ended June 30,
2000. This decrease is the net effect of increases in the areas of cost of goods
sold and other expenses with decreases in the Company's selling, general and
administrative expense.
8
<PAGE>
Six Month Periods Ended June 30, 2000 and 1999
The following table sets forth certain statement of operation items as
a percentage of net sales for the periods indicated:
Six Months Ended June 30,
------------------------
2000 1999
---- ----
Net Sales 100.0% 100.0%
Cost of Goods Sold 74.3 73.0
Gross Profit 25.7 27.0
Selling and Administration 17.8 18.8
Interest Expense 4.2 4.1
Other Expense 1.2 0.4
Income Tax Expense 1.2 1.3
----- -----
Net Income 1.2% 2.4%
===== =====
Cost of goods sold is determined as the sum of material costs, direct
manufacturing labor costs and an allocation of utilities and other overhead
costs attributable to manufacturing activities.
Total revenues increased slightly by $37,000 or 0.6% to $6,030,000 for
the six months ended June 30, 2000 from $5,993,000 for the six months ended June
30, 1999. Polychem ended the second quarter of 2000 with an order backlog of
$6,947,000 compared to $6,442,000 at the end of the comparable period in 1999,
an increase of 7.8%.
Gross profit decreased by $69,000 or 4.3% to $1,547,000 for the six
month period ended June 30, 2000 from $1,616,000 for the comparable period in
1999. Gross profit decreased as a percentage of sales to 25.7% for the six month
period ended June 30, 2000 from 27.0% for the comparable period in 1999. The
1.3% increase in the Company's cost of goods sold as a percentage of net sales
from the prior year, is the result of increases in direct labor costs as a
result of a labor agreement signed last year and the associated overhead as well
as the addition of product design support personnel during the most recent three
month period. These increases were somewhat offset by production-related
efficiencies noted during the quarter ended March 31, 2000. There have been
increases in plant capacity utilization, resulting in increased production
without substantial increases in manufacturing costs, improved productivity as a
result of mechanization through new equipment purchases and various other cost
saving measures implemented by management. An aggressive procurement program was
initiated during the second quarter of 2000 which management anticipates will
result in cost savings of approximately $30,000 over the remainder of the year.
Selling and administrative expenses decreased by $56,000 or 4.9% to
$1,074,000 for the six month period ended June 30, 2000 from $1,129,000 for the
comparable period in 1999. As a percentage of revenues, selling and
administrative expenses decreased to 17.8% for the six month period ended June
30, 2000 from 18.8% of total revenues for the comparable period in 1999. This
decrease is primarily attributable to reduction of administrative employees
during the current quarter, which was slightly offset by an increase in expenses
associated with the development of ConMat's E-business platform and the costs
associated with ConMat's reporting obligations as a public company. There was
also an increase in selling expenses relating to the establishment of sales
representatives in Latin America.
9
<PAGE>
Management is closely monitoring selling and administrative expenses
and expects such expenses to decrease as a percentage of sales in future periods
due to the discontinuance of these one- time costs and expected increased
revenues due to the realization of benefits from expenditures made in late 1997
and early 1998 in an effort to increase Polychem's global sales focus, including
the hiring of additional sales personnel. As the efforts of Polychem's global
sales force progress, Polychem anticipates increased revenues coupled with
appropriate increases in selling and administrative expenses.
Interest expense for the six month period ended June 30, 2000 increased
slightly by $12,000 or 4.8%, to $256,000 from $244,000 for the comparable period
in 1999. This higher cost reflects ConMat's increased borrowing on its working
capital line (primarily in the first three months of 2000) and incremental
carrying costs associated with a very large customer receivable balance that had
been outstanding for over 120 days which cost the Company over $80,000 in one
time expenses. This receivable balance was collected in early June 2000.
Interest costs as a percentage of total revenues increased to 4.2% in the six
month period ended June 30, 2000 compared to 4.1% in the comparable period in
1999. There was also an increase of $54,000 in net other expenses resulting from
increases in the area of corporate expenses.
ConMat realized a profit of $73,000 for the six month period ended June
30, 2000. For the comparable period in 1999, ConMat experienced a profit of
$141,000. The decrease in profitability is related to the increases in cost of
goods sold and net other expenses offset by decreases in selling, general and
administrative expense.
Liquidity and Capital Resources
ConMat realized a net cash increase of $11,000 for the six month period
ended June 30, 2000. For the comparable period in 1999, ConMat realized a net
cash surplus of $38,000. ConMat's primary source of financing is a credit
facility of up to $5 million, subject to a lending formula limit, secured by
Polychem's receivables and inventory. As of June 30, 2000, the maximum borrowing
amount was $1,668,000, and the outstanding balance was $1,385,000. Management
believes that ConMat has sufficient assets, equipment and facility to attain and
absorb forecasted growth in revenues. Management believes that ConMat's cash and
capital resources, together with cash flow from operations, will be sufficient
to finance current and forecasted operations including its capital spending and
research and development needs. ConMat is, however, actively seeking potential
strategic acquisitions and, depending on the size and terms of any such
acquisitions, additional financing, including equity infusions for ConMat, may
be required.
Year 2000 Compliance
ConMat has not experienced any material business interruptions or
supplier delays from Year 2000 computer issues to date and has not discovered
any Year 2000 problems in internal computer systems material to its operations.
However, the failure of ConMat's internal systems or those of any of its
customers, vendors, suppliers or service providers could have a material adverse
affect on operations.
10
<PAGE>
PART II
Item 1. Legal Proceedings.
ConMat is currently a defendant in a Pennsylvania state court action
filed on January 28, 1999, captioned John R. Thach v. The Eastwind Group, et al.
(Montgomery County C.C.P., Civil Action No. 99-01195). Plaintiff maintains that
Eastwind, his former employer, breached the terms of his severance agreement and
that the sale of Polychem to ConMat was part of a conspiracy to avoid payments
to him in violation of Pennsylvania's Uniform Fraudulent Transfer Act. The
plaintiff seeks damages of at least $350,0000 and punitive damages of at least
$500,000. In addition, the plaintiff seeks to have the acquisition of Polychem
declared null and void and to have a receiver appointed to oversee the affairs
of Eastwind, Polychem and ConMat. Among the other named defendants is Paul A.
DeJuliis, President of ConMat and the former Chief Executive Officer of
Eastwind.
Initially, the plaintiff sought a temporary restraining order and
preliminary injunction seeking to set aside the sale of Polychem to ConMat. By
Order dated February 19, 1999, the court denied plaintiff's request for
injunctive relief. ConMat and Paul A. DeJuliis answered the plaintiff's
Complaint on May 12, 2000 and the parties have engaged in fact discovery since
that date.
ConMat is currently a defendant in a federal district court action
filed on April 11, 2000, captioned ProFutures Special Equities Fund, L.P. v. The
Eastwind Group, Inc., et al. (U.S.D.C., E.D. Pa. Civil Action No. 00-CV-1888).
ProFutures maintains that Eastwind and others violated federal and state
securities laws and committed common law fraud in connection with the June 1998
purchase by ProFutures of $750,000 in Series C Convertible Preferred Stock of
Eastwind. ProFutures seeks damages in the amount of $750,000 and seeks to have
the acquisition of Polychem by ConMat declared null and void. Among other named
defendants is Paul A. DeJuliis, President of ConMat and former Chief Executive
Officer of Eastwind.
ConMat, Paul A. DeJuliis and two other former officers of Eastwind
filed a Motion to Dismiss the Complaint on May 25, 2000. The Motion has been
fully briefed and is currently awaiting disposition by the court.
Item 2. Changes in Securities.
Not Applicable.
Item 3. Defaults Upon Senior Securities.
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
Not Applicable.
11
<PAGE>
Item 5. Other Information.
Not Applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit No. Description
----------- -----------
27 Financial Data Schedule
(b) ConMat did not file any current reports on Form 8-K during the
period covered by this report.
12
<PAGE>
SIGNATURES
In accordance with 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, hereunto duly authorized.
CONMAT TECHNOLOGIES, INC.
Date: August 11, 2000 By: /s/ Paul A. DeJuliis
---------------------------------------------
Paul A. DeJuliis,
President and Chief Executive Officer
(Principal Executive Officer)
Date: August 11, 2000 By: /s/ William Crighton
---------------------------------------------
William Crighton,
Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
13
<PAGE>
Exhibit Index
Exhibit
Number Description
------ -----------
27 Financial Data Schedule
