<PAGE> 1
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 quarterly period ended March 31, 1998
Commission File Number 0-9519
REGENT TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
Colorado 84-0807913
-------- ----------
(State of Incorporation) (I. R. S. Employer Identification No.)
16415 ADDISON, SUITE 150, DALLAS, TEXAS 75248
--------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 972 732 9585
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 registration was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of May 20, 1998:
Class Number of Shares
- ----- ----------------
Common stock, $.01 Par Value 3,553,693
Transitional Small Business Disclosure Format: Yes: No: X
--- ---
<PAGE> 2
REGENT TECHNOLOGIES, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements.......................................................................... 2
CONSOLIDATED BALANCE SHEETS
As of March 31, 1998 (unaudited)
And December 31, 1997 (audited)............................................................. 2
CONSOLIDATED INCOME STATEMENTS
For the Three Months Ended March 31, 1998 (unaudited)....................................... 3
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 1998 (unaudited)....................................... 4
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)...................................... 5
Item 2. Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................................. 9
PART II OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds..................................................... 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............................................................................................. 12
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
REGENT TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
(Amounts in thousands)
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 1998 1997
--------- ------------
<S> <C> <C>
CURRENT ASSETS
Cash $ 2 $ 2
Notes receivable -- 46
Accounts receivable 53 12
------- -------
Total current assets 55 60
PROPERTY AND EQUIPMENT - AT COST
Furniture and fixtures 21 7
Printing equipment 726 --
Computer and electronic equipment 198 224
------- -------
945 231
Less accumulated depreciation and amortization 52 14
------- -------
893 217
OTHER ASSETS 430 335
------- -------
$ 1,378 $ 612
LIABILITIES
CURRENT LIABILITIES
Current portion of long term obligation $ 130 $ 20
Unearned revenues -- 5
Accounts payable and accrued liabilities 216 178
Accrued compensation 92 226
Notes payable to affiliates 77 --
------- -------
Total current liabilities 515 429
LONG TERM OBLIGATION 650 40
STOCKHOLDERS' EQUITY
Common stock, $.01 par value; authorized 100,000,000 shares,
issued and outstanding 3,553,693 and 2,561,198 shares for
1998 and 1997, respectively 35 26
Capital in excess of par value 3,150 2,799
Accumulated deficit (2,972) (2,682)
------- -------
Total Stockholders' Equity 213 143
------- -------
Total Liabilities and Stockholders' Equity $ 1,378 $ 612
</TABLE>
The accompanying notes are an integral part of these statements.
2
<PAGE> 4
REGENT TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
FOR THE MONTHS ENDED MARCH 31,
(unaudited)
(Amounts in thousands, except per share data)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
REVENUES
Digital prepress and printing sales $ 50 $ --
Internet and telecommunication product sales 47 2
Interest income and other 5 --
------- -------
102 2
COSTS AND OTHER DEDUCTIONS
Cost of prepress and printing sales 29 --
Cost of Internet sales and services 43 --
General and administrative 256 13
Depreciation and amortization 52 9
Interest expense 12 --
------- -------
392 22
NET EARNINGS (LOSS) $ (290) $ (20)
------- -------
NET EARNINGS (LOSS) APPLICABLE TO COMMON STOCK (290) (20)
------- -------
EARNINGS (LOSS) PER COMMON SHARE:
Basic $(0.094) $(0.010)
------- -------
Diluted $(0.081) $(0.009)
------- -------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic 3,079 2,100
------- -------
Diluted 3,575 2,150
------- -------
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE> 5
REGENT TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE MONTHS ENDED MARCH 31,
(unaudited)
(Amounts in thousands)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net earnings (loss) $(290) (20)
Adjustments To Reconcile Net Earnings (loss)
to Net Cash Provided (Used) by Operating Activities:
Depreciation and amortization 52 9
(Increase) Decrease in
Accounts receivable (41) --
Deposits (5)
Increase (Decrease) in
Accounts payable and accrued liabilities 38 (5)
Accrued compensation 77 6
----- ---
Net Cash Provided (Used) In Operating Activities: (169) (10)
----- ---
CASH FLOW FROM INVESTING ACTIVITIES:
Net collections on notes receivables 46 --
(Increase) Decrease of property and equipment 36
Proceeds (Costs) of investment in subsidiary (1) --
(Increase) Decrease in other assets -- (1)
----- ---
Net Cash Provided (Used) In Investing Activities: 81 (1)
----- ---
CASH FLOW FROM FINANCING ACTIVITIES:
Issuance of common stock 40 10
(Increase) Decrease of equipment under capital leases (29) --
Net proceeds from (repayment of) note to stockholder 77 2
----- ---
Net Cash Provided (Used) From Financing Activities 88 12
----- ---
Increase (Decrease) In Cash 0 1
----- ---
Cash at Beginning of Period 2 1
----- ---
Cash at End of Period $ 2 2
----- ---
SUPPLEMENTAL DISCLOSURES
Cash paid during the period for interest and income taxes 12 --
----- ---
</TABLE>
The accompanying note are an integral part of these statements.
4
<PAGE> 6
NOTES TO FINANCIAL STATEMENTS
March 31, 1998 (unaudited) and December 31, 1997
(1) BASIS OF PRESENTATION
The accompanying financial statements, which should be read in conjunction with
the financial statements of Regent Technologies, Inc. (the "Company") included
in the 1996 Annual Report filed on Form 10-KSB, are unaudited but have been
prepared in the ordinary course of business for the purpose of providing
information with respect to the interim period. The Company believes that all
adjustments (none of which were other than normal recurring accruals) necessary
for a fair presentation of the Company's financial position as of March 31, 1998
and the results of its operations and its cash flows for the three-month period
ended March 31, 1998 have been included.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Business
Regent Technologies, Inc. (the "Company"), formerly Regent Petroleum
Corporation, was incorporated on January 18, 1980, for the purpose of
exploration and development of oil and gas properties in the United States.
Activities of the Company up to 1992 were primarily organization, issuance of
equity capital and acquisition of developed and undeveloped oil and gas
properties. In 1992, the Company redirected its core business to environmental
technologies and the joint-venture of water filtration systems. In 1994, the
Company acquired SSB Environmental, Inc., which was organized for the purpose of
providing environmental services. In 1996, the Company divested its
environmental interests and licensed propriety technology for the purpose of
offering Internet access and related products and services (the "Technology
License"). In January, 1998, the Company announced its entry into the digital
prepress and printing business through a new subsidiary company, Regent Digital
Imaging, Inc. ("Regent Digital"). Regent Digital engages in on-demand print and
digital prepress business in the Dallas - Ft. Worth markets. At the shareholders
meeting held on March 4, 1998, the shareholders approved a 1 for 6 reverse split
of the Common Stock of the Company. The Company conducts its operations through
four wholly owned subsidiaries: (i) Regent Digital Imaging, Inc.; (ii)
ConnecTen, L.L.C.; (iii) Regent Tel1 Communications, Inc.; and (iv) Channel
Services, L.C. Regent's executive officers are located at 16415 Addison Road,
Suite 150, Dallas, Texas 75248 and its telephone number is (972) 732 9585.
Depreciation and Amortization
Depreciation of furniture and fixtures is provided in amounts sufficient to
relate the cost of depreciable assets to operations over their estimated
services lives (5 years). The straight-line method of depreciation is used for
financial reporting purposes, while accelerated methods are used for tax
purposes. Amortization of all licenses is provided in amounts which reflect the
anticipated minimum number of years of the term of the license (10 years).
Income Taxes
The Company utilizes the method of accounting for income taxes set forth in
Statement of Financial Accounting Standards No. 109 "Accounting for Income
Taxes" (SFAS 109). SFAS 109 requires the recognition of deferred tax liabilities
and assets for the expected future tax consequences of events that have been
recognized in the Company's financial statements or tax returns. Under this
method, deferred tax liabilities and assets are determined based on the
difference between the financial statement carrying amounts and tax bases of
assets and liabilities, using enacted tax rates in effect in the years which the
differences are expected to reverse. These temporary differences primarily
relate to depreciation, depletion and amortization. The Company has not
recognized the benefit of any net operating loss carryforwards as the result of
adopting SFAS 109, and no deferred tax assets have been recorded in the books of
the Company due to uncertainty as to the Company's ability to utilize the loss
carryforwards.
5
<PAGE> 7
NOTES TO FINANCIAL STATEMENTS
March 31, 1998 (unaudited) and December 31, 1997
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--CONTINUED
Consolidated Statements of Cash Flows
The Company does not consider any of its assets to meet the definition of a cash
equivalent.
Earnings Per Share
In February 1997, the FASB issued SFAS No. 128, "Earnings per Share," which is
required to be adopted for years ending after December 15, 1997. Accordingly,
the Company has adopted the provisions of the new statement.
The following table sets forth the computation of basic and dilutive earnings
per share:
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31,
1998 1997
----------- -----------
<S> <C> <C>
Numerator for basic and diluted earnings per
share-net income available for common
stockholders........................................... $ (290,107) $ (20,001)
Denominator:
Denominator for basic earnings per share--
weighted average shares.............................. 3,078,546 2,150,087
Effect of dilutive securities:
Stock options........................................ 496,668 -0-
Warrants............................................. -0- -0-
Denominator for basic and diluted earnings per share-adjusted
weighted-average shares and assumed conversions........ 3,575,214 2,150,087
</TABLE>
The following securities have been excluded from the dilutive per share
computation as they are antidilutive:
<TABLE>
<CAPTION>
Three Months Ended
----------------------
March 31,
1998 1997
------- -------
<S> <C> <C>
Stock options ............ -0- -0-
Warrants ................. 346,654 -0-
</TABLE>
(3) STOCKHOLDERS' EQUITY
Common Stock: As of March 31, 1998, 3,553,693 shares of Common Stock were issued
and outstanding.
Preferred Stock: None
6
<PAGE> 8
NOTES TO FINANCIAL STATEMENTS
March 31, 1998 (unaudited) and December 31, 1997
(4) STOCK OPTION PLANS AND WARRANTS
Pursuant to certain director and employment agreements, a total of 496,668
options have been granted at exercise prices ranging from $0.30 to $0.60 per
share predominantly with a maturity date of December 31, 2000. With the
acquisition of Channel Services, 13,334 warrants were issued to purchase the
same number of shares for $1.80 per share with an exercise date of before
December 31, 1998. Upon the successful placement of 666,667 shares of restricted
common stock for $0.60 per share, an additional 333,333 warrants were issued for
the purchase of the same number of shares for $1.00 per share with an exercise
date between June 30, 1998 and on or before January 2, 1999. All options and
warrants are for the purchase of newly issued, restricted shares of Common Stock
of the Company.
(5) CREDIT FACILITIES
At March 31, 1998, the Company's debt consisted of the following:
Capital lease with Cisco Systems, Inc. dated 2/3/98 in the amount of
$24,594 payable in 36 monthly installments of $760.05 plus tax;
Capital lease with Cisco Systems, Inc. dated 12/18/97 in the amount of
$60,110 payable 36 monthly installments of $1,857.72 plus tax;
Three capital leases with Eagle Leasing dated 2/1/98 in the amount
of $725,000 payable in 36 monthly installments of $16,526 plus
tax;
Less current portion:
Line of Credit for $250,000, dated January 1, 1998; interest at 8%
with maturity at December 31, 1998; $76,646 outstanding at
March 31, 1998.
(6) OTHER ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1998 1997
--------- ------------
<S> <C> <C>
Investment, minority ownership SSBE 13,496 13,496
Deposits 5,065 --
Technology License, less accumulated amortization
of $54,624 and $45,520 in 1998 and 1997, respectively 309,771 318,875
Goodwill, less accumulated amortization of $5,977 in
1998 99,683 --
Organization Costs 2,729 --
</TABLE>
7
<PAGE> 9
NOTES TO FINANCIAL STATEMENTS
March 31, 1998 (unaudited) and December 31, 1997
(7) TRANSACTIONS WITH RELATED PARTIES
The Company entered into a borrowing line of credit agreement with its Chairman
under which the Company may borrow up to $250,000 for the Company's working
capital needs. The line matures at December 31, 1998 and bears interest at a
rate of 8 per cent per annum. At March 31, 1998, the amounts borrowed under the
line of credit totaled $76,646.
(8) COMMITMENTS
On September 1, 1997, the Company opened a new office located at 2929 Elm St.,
Dallas, Texas 75226 under a five year lease which provides for rental payments
of $3,500 per month. The Company entered into a lease for Regent Digital
Imaging, Inc. at 16415 Addison Road, Suite 150, Dallas, Texas, 75248 which
provides for rental payments of $4,670.61 through February 17, 2000.
(9) SUBSEQUENT EVENT
On April 24, 1998, the Company signed a Letter Agreement to merge the operations
of Digital Press & Imaging, L.L.C. ("DPI") into Regent Digital which will add
three digital printing operating offices (the "DPI Merger"). The expected
closing of the DPI Merger is on or before July 1, 1998. Following the closing,
DPI will change its name and operate under the auspices of Regent Digital.
Following the DPI Merger, the Company will have an operating presence in five
major markets, including Dallas, Ft. Worth, Austin, San Antonio and Tulsa,
Oklahoma.
8
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
GENERAL
The statements contained in this Form 10-QSB that are not historical
facts are forward-looking statements (as such term is defined in the Private
Securities Litigation Reform Act of 1995) that involve risks and uncertainties.
Such forward-looking statements may be identified by, among other things, the
use of forward-looking terminology such as "believes," "expects," "may," "will,"
should" or "anticipates" or the negative thereof or other variations thereon or
comparable terminology, or by discussions of strategy that involve risks and
uncertainties. From time to time, the Company or its representatives have made
or may make forward-looking statements, orally or in writing. Such
forward-looking statements may be included in various filings made by the
Company with the Securities and Exchange Commission, or press releases or oral
statements made by or with the approval of an authorized executive officer of
the Company. These forward-looking statements, such as statements regarding
anticipated future revenues, capital expenditures and other statements regarding
matters that are not historical facts, involve predictions. The Company's actual
results, performance or achievements could differ materially from the results
expressed in, or implied by, these forward-looking statements. Potential risks
and uncertainties that could affect the Company's future operating results
include, but are not limited to: (i) economic conditions, including economic
conditions related to the Internet business and the digital print industry; (ii)
the availability of equipment from the Company's vendors at current prices and
levels; (iii) the intense competition in the markets for the Company's products
and services; (iv) the Company's ability to integrate acquired companies and
businesses in a cost-effective manner; (v) the Company's ability to effectively
implement its branding strategy; (vi) the Company's ability to develop, market,
provide and achieve market acceptance of new service offerings to new and
existing clients; (vii) governmental regulations related to the Internet and
(viii) governmental regulations for environmental safeguards related to the
printing business.
BUSINESS
Regent Technologies, through its subsidiaries, provides a broad range
of digital prepress and digital short run color printing services for the
printing, publishing and packing marketplace. In addition, the Company offers
Internet access to the professional and corporate marketplace with an emphasis
on Internet access for digital printing operations. Digital prepress involves
the creation and manipulation of a combination of text, graphics, or photographs
to be used on a printed page. The process can range from scanning images into
computer networks to downloading customer created files for processing to
various digital output devices. The prepress services afford customers the
ability to modify or enhance a digital image throughout the design and approval
process with faster turnaround and at a lower price than traditional or
non-digital prepress process. Digital printing is made up of "on demand" high
quality, "short run" (1 to 1,000 pieces), full color digital printing through
the use of state-of-the-art digital printing equipment. Regent's key digital
printing devices are the Indigo E-Print 1000 digital sheetfed printing presses
with plans to add the Heidelburg DI for longer runs. A long-term objective for
Regent is to build a "digital information distribution network" with archiving
and network capabilities. This network would have an open architecture that
could service its users in a variety of ways, including access over the Internet
through Regent's "on net" facility in downtown Dallas, Texas, operated through
the Company's wholly owned subsidiary, ConnecTen, L. L.C.
ACQUISITION STRATEGY
With its entry into the digital printing industry through Regent
Digital and the DPI Merger (see "Recent Business Developments"), the Company
will seek to expand this business with the acquisition of companies in markets
with concentrations of graphic artists and marketing professionals which have
the potential to utilize digital prepress and digital printing operations as
well as digital distribution networks. The Company believes it will be regarded
by acquisition candidates as an attractive acquiror because of: (1) the
Company's plans for creating a national
9
<PAGE> 11
presence of comprehensive and professionally managed digital prepress and
printing operation centers that emphasize the development of long-term customer
relationships at the local, regional and national levels; (2) the Company's
decentralized operating philosophy; (3) the potential for owners of the acquired
businesses to participate in the Company's planned growth while realizing
liquidity; (4) the Company's increased name recognition and its access to
financial resources as a public company; and (5) the potential for increased
profitability of the acquired company due to purchasing economics and the
centralization of certain administrative functions. The Company is currently
involved in negotiations with acquisition candidates in addition to the
acquisition under the DPI Merger letter of intent.
RESULTS OF OPERATIONS
The Company's net loss for the period ended March 31,1998 was $290,107,
or $.081 cents per common share, compared with a net loss of $20,001, for the
same period in 1997. The difference was due to the increase of costs associated
with expanded Internet operations and the startup expenses of the new Regent
Digital Imaging, Inc. prepress and printing business.
COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1998 TO THE THREE MONTHS ENDED
MARCH 31, 1997.
Net Sales. Net sales from operations for the three months ended March
31, 1998 were $101,947, an increase of $99,947 or 4,997.3%, compared to $2,000
for the three months ended March 31, 1997. The increase in net sales was
primarily attributable to the inclusion of new sales from the Company's entry
into the prepress and digital printing business which created revenues of
$50,357 beginning in February, 1997, plus continued growth in the Internet and
telecommunications revenues of $51,589.
Cost of Sales. Costs of goods sold for the three months ended March 31,
1998 was $71,995, an increase of $71,495 compared to the same period in 1997.
The increase was primarily due to the new printing operations.
Gross Profit. Gross profit for the three months ended March 31, 1998
was $29,952, an increase of $29,452 compared to the same period of 1997. Gross
profit as a percent of sales was 70.62%. The prepress and digital printing
gross profit as a percent of sales was 57.3% and the Internet and
telecommunications gross profit as a percent of sales was 84.2%. Both
percentage amounts are the result of one-time costs related to opening new
offices for increasing sales capacity.
Miscellaneous income. The Company had consulting and commission income
through its telecommunication interests in the first quarter of 1998.
Selling, general and administrative expense. For the three months ended
March 31, 1998, selling, general and administrative expenses increased $254,000
from 1997 due to the increase of operating costs associated with digital
imaging and Internet activities related primarily to salary expense for
increased management and operations personnel.
Depreciation and amortization. For the three months ended March 31,
1998, amortization expense for goodwill and intangibles increased to $52,000
compared to the same period in 1997 due to the amortization of goodwill and the
depreciation of capitalized leases .
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1998, excluding amounts owed to officers and affiliates,
the Company had net working capital of $(291,000) compared to $(30,000) for the
same period in 1997.
10
<PAGE> 12
Net cash used by operating activities totaled $169,000 for the three months
ended March 31, 1998. This amount was reduced by the Chairman and the President
deferring all compensation under their employment contracts and other partial
deferrals totaling $77,000. Cash provided from investing activities was due to
the collection of a note receivable from the Chairman of $46,000 and the return
of equipment to Ascend Communications, Inc. which had been received under an
evaluation program. Cash provided from financing activities increased $76,000
principally from $40,000 for the sale of new restricted previously unissued
common stock and $77,000 from the line of credit with the Chairman. The Company
is current on all trade payables excluding amounts owed to officers and
affiliates. The net effect of cash flows from operating activities, investing
activities and financing activities was zero. The Company believes that current
cash balances, available borrowing capacity on its line of credit and cash
generated from operations will provide sufficient cash to meet its operating
requirements.
OTHER MATTERS
The Company believes that its management information systems are able
to process all transactions including those relating to the year 2000 and
beyond. Additionally, the Company uses an independent service bureau for the
processing for payroll and payroll tax related operations and has been notified
by the service bureau that all of its systems will be fully compliant with year
2000 requirements. Although the Company believes that the information systems of
its major customers and vendors (insofar as they relate to the Company's
business) comply with year 2000 requirements, there can be no assurance that the
year 2000 issue will not effect the information systems of such customers and
vendors as they relate to the Company's business or that any such impact would
not have a material adverse effect on the Company's business, financial
condition or results of operations.
PART II-OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
Pursuant to an option approved by the Board of Directors effective
April 1, 1997, certain employees elected to convert earned but unpaid salaries
at December 31, 1998 in the amount of $226,363 to 709,543 shares of newly issued
restricted Common Stock of the Company.
Pursuant to the annual shareholders meeting held on March 4, 1998, the
Company reversed its stock 1 for 6 effective April 1, 1998. The amounts of stock
presented in this Form 10-QSB reflect this stock reverse except the amounts
shown in Item 4 next.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Annual Meeting of the Stockholders of the Company was held on March
4, 1998.
There were 9,958,288 shares present at the meeting in person or by
proxy. The results of the vote taken at such meeting with respect to each
nominee for director were as follows:
<TABLE>
<CAPTION>
Nominee For Withheld
------- --- --------
<S> <C> <C>
Roy W. Mers 9,950,656 9,632
David A. Nelson 9,950,656 9,632
Gordon M. Boyd 9,950,656 9,632
William D. Bingham 9,950,656 9,632
</TABLE>
Also, at the meeting, a vote was taken on the proposal to reverse the
stock 1 for 6. Of the 9,958,288 shares present at the meeting in person or by
proxy, 9,921,985 shares were voted
11
<PAGE> 13
in favor of such proposal, 28,592 shares were voted against and 7,711 shares
abstained from voting.
ITEM 5. OTHER INFORMATION
Subsequent to the end of the quarter, on April 24, 1998, the Company
signed a Letter Agreement to merge the operations of Digital Press & Imaging,
L.L.C. ("DPI") into Regent Digital Imaging, Inc. (the "DPI Merger"). The
expected closing of the DPI Merger was announced as on or before July 1, 1998.
Following the closing, DPI will change its name and operate under the auspices
of Regent Digital. Following the DPI Merger, the Company will have an operating
presence in five major markets, including Dallas, Ft. Worth, Austin, San Antonio
and Tulsa, Oklahoma.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27 Financial data schedule for the quarter ended March 31,
1998 (included only in the copy of this report filed
electronically with the Commission).
(b) Reports of Form 8-K
On March 30, 1998, the Company filed a Current Report on Form
8-K reporting the Company's entry into the prepress and
digital printing business through a newly formed wholly owned
subsidiary, Regent Digital Imaging, Inc.
Subsequent to the end of the quarter, on May 12, 1998, the
Company filed a Current Report on Form 8-K reporting a letter
of intent to acquire Digital Press & Imaging, LLC, in a
transaction valued at about $4,500,000.
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly cause this report to be signed on its behalf by the
undersigned thereunto duly authorized.
REGENT TECHNOLOGIES, INC.
(Registrant)
Date: May 20, 1998 By: Roy W. Mers
------------------------------
Roy W. Mers
Principal Executive Officer
Date: May 20, 1998 By: David A. Nelson
------------------------------
David A. Nelson
Principal Financial Officer
12
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
27 Financial data schedule for the quarter ended March 31, 1998
(included only in the copy of this report filed electronically
with the Commission).
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 2
<SECURITIES> 0
<RECEIVABLES> 53
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 55
<PP&E> 945
<DEPRECIATION> 52
<TOTAL-ASSETS> 1,378
<CURRENT-LIABILITIES> 515
<BONDS> 0
0
0
<COMMON> 35
<OTHER-SE> 3,150
<TOTAL-LIABILITY-AND-EQUITY> 1,378
<SALES> 102
<TOTAL-REVENUES> 102
<CGS> 72
<TOTAL-COSTS> 392
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (290)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (290)
<EPS-PRIMARY> (.094)
<EPS-DILUTED> (.081)
</TABLE>
