U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 1997
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from __________________ to _________________
Commission File No. 0-4006
ORION DIVERSIFIED TECHNOLOGIES, INC.
( Name of Small Business Issuer in its charter)
New Jersey 22-1637978
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
80 Raynor Avenue, Ronkonkoma New York 11779
(Address of Principal Executive Offices) (Zip Code)
(516) 467-2301
(Issuer'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 Exchange Act during the past
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.
YES __X__ NO ______
APPLICABLE ONLY T O ISSUES INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
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Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Section 12,13 or 15(d) of the Exchange Act after
the distribution of securities under a plan confirmed by a court.
YES __X__ NO ______
APPLICABLE ONLY TO CORPORATE REGISTRANTS
Indicate the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.
Common Stock, $.01 Par Value, 1,844,397 shares
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ORION DIVERSIFIED TECHNOLOGIES, INC.
FOR THE SIX MONTHS ENDED OCTOBER 31, 1997 AND 1996
BALANCE SHEET
(Unaudited) (Unaudited)
Oct. 31, 1997 Oct. 31, 1996
------------- -------------
ASSETS
------
Current Assets:
Cash 0 0
Maintenance Receivables 0 0
Inventory 104,101 104,101
Rent Receivable 0 0
Due from Michaels Associates 0 0
-------- --------
Net to allow for bad debts of $242,000
Total Current Assets 104,101 104,101
-------- --------
Property:
Land 0 0
Buildings (Net) 0 0
0 0
-------- --------
Other Assets:
Cash - Capital Reserve 0 0
Excess of Cost Over Net Assets Acquired 0 0
Security Deposit 0 0
-------- --------
Total Assets 104,101 104,101
-------- --------
LIABILITIES & STOCKHOLDERS EQUITY
---------------------------------
Current Liabilities
Accounts Payable and Accrued Expenses 5,000 5,000
Due to Officers 123,862 123,712
Payroll Taxes Payable - Chapter XI 137,465 137,465
Payroll Taxes Payable 0 0
-------- --------
266,327 266,177
-------- --------
LONG TERM DEBT
--------------
Mortgage Payable
Total Liabilities 0 0
Total Liabilities 266,327 266,177
Minority Interest in Subsidiary 0 0
-------- --------
Stockholders Equity
Common Stock, Par Value $.01 184,443 18,443
Paid-In Capital 3,737 3,737
Deficit (184,402) (184,256)
-------- --------
Total Stockholders Equity (162,226) (162,076)
-------- --------
Total Liabilities & Stockholders Equity 104,101 104,101
-------- --------
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ORION DIVERSIFIED TECHNOLOGIES, INC.
STATEMENT OF OPERATIONS
THE SIX MONTHS ENDED OCTOBER 31, 1997 AND 1996
(Unaudited) (Unaudited)
INCOME 1997 1996
- ------ --------- ---------
Revenues
Maintenance Fees 0 0
--------- ---------
Costs & Expenses
General & Administrative 0 0
Interest 0 0
Depreciation & Amortization 0 0
--------- ---------
Total Costs & Expenses 0 0
--------- ---------
Loss Before Minority Interest 0 0
Net Loss 0 0
--------- ---------
Net Loss Per Common Share 0 0
--------- ---------
Weighted Average Number of Common Shares 1,844,397 1,844,397
--------- ---------
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ORION DIVERSIFIED TECHNOLOGIES, INC.
STATEMENT OF STOCKHOLDERS EQUITY
THE SIX MONTHS ENDED OCTOBER 31, 1997
Additional
Common Stock Paid In Accumulated
Shares Amount Capital Deficient Total
------ ------ ------- --------- -----
Balance 4/30/96 1,844,397 $ 18,443 $ 3,373 $(184,256) $(162,076)
Loss For Period 150) $ (150)
---------------------------------------------- ---------
Balance 4/30/97 1,844,397 $ 18,447 $ 3,373 $ 184,406 $(162,226)
---------------------------------------------- ---------
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ORION DIVERSIFIED TECHNOLOGIES, INC.
STATEMENT OF CASH FLOWS FOR
THE SIX MONTHS ENDED OCTOBER 31, 1997 AND 1996
(Unaudited) (Unaudited)
1997 1996
---- ----
Cash Flow from Operating Activities
Net Loss 0 0
Adjustments to Reconcile Net Loss
to Net Cash Provided by (Used For)
Operating Activities
Depreciation & Amortization 0 0
Minority in Net Loss of Subsidiary 0 0
Changes in Assets & Liabilities
Accounts Receivable 0 0
Rent Receivables 0 0
Due From Michaels Associates 0 0
Purchase of Equipment 0 0
Provision for Bad Debts 0 0
Accounts Payable & Accrued Expenses 0 0
Payroll Taxes Payable 0 0
Due to Officers 0 0
Mortgage Payable 0 0
Capital Reduction 0 0
Land 0 0
Building 0 0
Other Assets 0 0
Loan Payable - Other 0 0
---- ----
Net Cash Provided By (Used In) Operations 0 0
---- ----
Net Increase/Decrease in Cash 0 0
---- ----
Cash - Beginning 0 0
---- ----
Cash - Ending 0 0
---- ----
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ORION DIVERSIFIED TECHNOLOGIES, INC.
STATEMENT OF CASH FLOWS FOR
THE SIX MONTHS ENDED OCTOBER 31, 1997 AND 1996
(Unaudited) (Unaudited)
1997 1996
---- ----
Supplemental Disclosure of Cash Flow
Information:
Cash Paid During the Period 0 0
---- ----
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ORION DIVERSIFIED TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997
NOTE I - SUMMARY OF SIGNIFICANT ACCOUNT PRINCIPLES
(a) General
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
in accordance with the instruction to Form 10-Q. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the interim financial statements include all adjustments necessary
in order to make the consolidated financial statements not misleading. The
results of operations for the six months ended October 31, 1997, are not
necessarily indicative of the results to be expected for the full year. For
further information, refer to the Company's audited financial statements and
footnotes thereto as April 30, 1997, included in its Form 10-K filed with the
Securities and Exchange Commission.
Although the Company ostensibly still sells semiconductors, no revenue from its
activity was received during the six months ended October 31, 1997. Accordingly,
and in light of the fact that the Company has not received any semiconductor
income for three months and in any subsequent business combination, the
Company's $104,101 inventory of semiconductors is likely to be transferred to
the Company's President, in partial consideration for his assumption of the
Company's $261,177 in liabilities, it should be considered that the Company no
longer is engaged in this line of business.
NOTE 2 - PAYROLL TAXES - CHAPTER 11
In connection with the Plan of Reorganization, payroll taxes are due within six
years from April 23, 1986, the date of assessment. Accordingly, the tax
liability, which includes accrued interest, is classified as current.
As indicated in Note 1, it is expected that this liability will be assumed by
the Company's President in connection with the Company's preparation for a
reverse marger transaction. It is expected that the Company will receive
indemnification for Mr. Petito.
NOTE 3 - COMMON STOCK PURCHASE WARRANTS
In accordance with the Plan of Reorganization, 905,262 redeemable Class A and
Class B Purchase Warrants were issued between September 19, 1990, and December
30, 1990. Each Warrant entitles the holder to purchase one "new" share of the
Company's stock for each warrant that is exercixed. The exercise price of the
Class A and Class B Warrants
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are $2.50 and $3.50, respectively. The expiration date for both Classes of
Warrants was extended to December 31, 1997, by the Board of Directors.
As of October 31, 1997 and 1996, 903,761 Class A and 905,262 Class B Warrants
were outstanding.
NOTE 4 - RELATED PARTY TRANSACTIONS
(a) Transactions with Management
The Company has agreed to certain transactions with Joseph Petito, the Company's
President, Chief Operating Officer, Chairman of the Board and majority
Shareholder. Such transactions are described below:
1. Facilities
The Company's President has arranged for the Company to conduct its business
affiars on the premises of a company controlled by the President and located in
Ronkonkoma, New York. Said premises and office equipment is being utitlized on a
rent free basis.
2. Compensation and Other Costs
The Company has had minor sales and on other income since the relocation of its
offices. As a result, virtually all of the Company's operating expenses have
been advanced by Mr. Petito.
Costs advanced to the Company by Mr. Petito for the three months ended
October 31, 1997, amount to $2,300.
On June 2, 1990, the Board of Directors agreed to provide compensation to Mr.
Petito, at the rate of $1,500 per week. On May 2, 1994, Mr. Petito agreed to
forego the $1,500 weekly compensation until the Company shows a significant
upward trend in its results of operations.
3. Due to Officer
The details of the Due to Officer Account are as follows:
Salary Advances Total
Balance - April 30, 1997 78,000 45,712 123,712
------------------------------------------
Balance Oct. 31, 1997 78,000 45,712 123,712
------------------------------------------
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Management's Discussion and Analysis of Plan of Operations
During the six months ended October 31, 1997, the Company experienced a $0 net
loss without any revenues. The Company's de minimus general and administrative
expenses were in turn due to the Company's President, Joseph Petito, allowing
the Company to operate on a rent free basis in the premises of an otherwise
non-affiliated privately owned entity controlled by Mr. Petito's family.
The drastic reduction in both the Company's gross revenue and general and
administrative expenses was entirely attributable to the Company's January 11,
1996 divestiture of NGO. The divestiture left the Company without material
assets or capital resources. Accordingly, the continued economic viability of
the Company is entirely dependent upon Mr. Petito's continued funding of the
Company's expenses and providing the Company with rent free premises and the use
of office equipment.
There can be no assurance whatsoever that management will be successful in
consummating a business combination during the foresseable future. However, and
based upon management's recent success in attracting potentially acceptable
business combination partners, management is still reasonably optimistic that it
can reach a preliminary meeting of the minds with a business combination partner
prior to the end of the 1998 calendar year.
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PART II - OTHER INFORMATION
Item 5 - Exhibits and Reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K - None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: December 29, 1997
Orion Diverisfied Technologies, Inc.
By:____________________________________
Joseph Petito, President, Chief Executive
Officer and Chief Financial Officer
