FORM 10-Q Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[ X ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the period ended June 30, 1997
--------------
or
[ ] Transition Report Pursuance to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the transition period from to
--------------- ----------------
Commission File Number 0-12893
--------
SSI CAPITAL CORP.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
New York 14-1623047
------------------------------ -----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2901 S. Tejon, Englewood, Colorado 80110
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(303)783-9499
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Former Address: 150 Vanderbilt Motor Parkway, Hauppauge, New York 11788
- --------------------------------------------------------------------------------
Former Fiscal Year End: November 30
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report.)
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.
[ X ] Yes [ X ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
[ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of June 30, 1997, Registrant had 18,246,940 shares of common stock, $.001 Par
Value, outstanding.
<PAGE>
INDEX
-----
Page
Number
------
Part I. Financial Information
Item I. Financial Statements
Consolidated Balance Sheets as of June 30,
1997 (Unaudited) and December 31, 1996 2
Consolidated Statements of Income Three
Months Ended June 30, 1997 and
June 30, 1996 (Unaudited) 3
Consolidated Statements of Income, Six
Months Ended June 30, 1997 and
June 30, 1996 (Unaudited) 4
Consolidated Statement of Changes in
Stockholders' Equity from December 31,
1996 through June 30, 1997 (Unaudited) 5
Consolidated Statements of Cash Flows,
Three Months Ended June 30, 1997 and
June 30, 1996 (Unaudited) 6
Consolidated Statements of Cash Flows,
Six Months Ended June 30, 1997 and
June 30, 1996 (Unaudited) 7
Notes to Consolidated Financial Statements 8
SSI Capital Corp. Balance Sheets as of
November 30, 1996 and December 31, 1996
(Unaudited) 10
SSI Capital Corp. Statement of Income,
One Month Period Ended December 31, 1996
(Unaudited) 11
SSI Capital Corp. Statement of Cash Flows,
One Month Period Ended December 31, 1996
(Unaudited) 12
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of
Operations 14
Part II. Other Information 17
1
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
BALANCE SHEETS
(Unaudited)
June 30 December 31
1997 1996
---------- -----------
Current Assets
Cash in bank $ 756,824 $ 120,399
Inventory 382,294 450,984
Accounts receivable, net of allowance
for doubtful accounts 385,454 392,469
Other current assets 52,212 18,979
---------- ----------
Total Current Assets 1,576,784 982,831
Property and equipment, net of accumulated
depreciation 158,179 157,822
Other assets 150 150
---------- ----------
Total Assets $ 1,735,113 $1,140,803
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities
Accounts payable and accrued expenses $ 244,880 $ 373,199
Income taxes payable 123,576 --
---------- ----------
Total Current Liabilities 368,456 373,199
---------- ----------
Stockholders' Equity:
Preferred stock - $.01 par value
1,000,000 shares authorized
none issued and outstanding -- --
Common stock - $.001 par value,
100,000,000 shares authorized;
18,246,940 shares issued and
outstanding at June 30, 1997 and
14,917,399 at December 31, 1996 18,247 14,917
Additional paid-in capital 1,153,064 129,999
Retained earnings 195,346 622,688
---------- ----------
Total Stockholders' Equity 1,366,657 767,604
---------- ----------
Total Liabilities and Stockholders' Equity $1,735,113 $1,140,803
========== ==========
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Three Months
Ended Ended
June 30 June 30
1997 1996
------------ ------------
Revenue:
Sales $ 1,213,095 $ 1,116,020
Cost of sales 540,689 554,564
------------ ------------
Gross Profit 672,406 561,456
------------ ------------
Operating Expenses
Salaries 144,725 82,131
Bad debts 6,065 28,692
Rent 16,500 13,769
Commissions 50,835 48,738
Consulting fees 42,343 38,849
Trade shows 20,908 27,535
Depreciation 11,193 11,867
Stock issued for services 85,000 --
Other operating expenses 128,837 127,363
------------ ------------
Total Operating Expenses 506,406 378,944
------------ ------------
Net Operating Income 166,000 182,512
------------ ------------
Other Income (Expenses)
Interest income 7,229 6,103
Gain on sale of securities 100 70,142
Interest expense -- (1,624)
------------ ------------
Total Other 7,329 74,621
------------ ------------
Net Income before taxes 173,329 257,133
Income taxes 123,576 --
------------ ------------
Net Income $ 49,753 $ 257,133
============ ============
Net Income per Common Share $ nil $ .02
============ ============
Weighted Average Shares Outstanding 16,759,670 14,917,399
============ ============
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Six Months Six Months
Ended Ended
June 30 June 30
1997 1996
------------ ------------
Revenue:
Sales $ 2,932,357 $ 2,380,656
Cost of sales 1,212,141 1,059,907
------------ ------------
Gross Profit 1,720,216 1,320,749
------------ ------------
Operating Expenses
Salaries 261,869 164,467
Bad debts 14,662 28,692
Rent 33,000 27,709
Commissions 123,506 105,872
Consulting fees 47,744 64,926
Trade shows 49,086 64,873
Depreciation 21,683 23,733
Stock issued for services 340,000 --
Other operating expenses 257,616 240,641
------------ ------------
Total Operating Expenses 1,149,166 720,913
------------ ------------
Net Operating Income 571,050 599,836
------------ ------------
Other Income (Expenses)
Interest income 11,831 14,147
Other income 182 --
Gain on sale of securities 100 91,975
Interest expense -- (1,963)
------------ ------------
Total Other 12,113 104,159
------------ ------------
Net Income before taxes 583,163 703,995
Income taxes 123,576 --
------------ ------------
Net Income $ 459,587 $ 703,995
============ ============
Net Income per Common Share $ .03 $ .05
============ ============
Weighted Average Shares Outstanding 16,261,554 14,917,399
============ ============
4
<PAGE>
<TABLE>
<CAPTION>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
From December 31, 1996 through June 30, 1997
(Unaudited)
Preferred Stock Common Stock Additional
---------- ------ ------------ Paid-in Retained
No./Shares Amount No./Shares Amount Capital Earnings Total
---------- ------ ---------- ------ ------- -------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1996 - $ - 14,917,399 $ 14,917 $129,999 $ 622,688 $ 767,604
Common stock issued for
services - - 680,000 680 339,320 - 340,000
Reorganization/additional
paid in capital - - 1,999,541 2,000 187,609 - 189,609
Common stock issued for cash - - 650,000 650 324,350 - 325,000
Reclassification of
undistributed S Corporation
earnings - - - - 171,786 (171,786) -
Net income for the six month
period ended June 30, 1997 - - - - - 459,587 459,587
Dividends paid - - - - - (715,143) (715,143)
--------- ------- ---------- --------- ----------- ----------- ----------
Balance at June 30, 1997 - $ - 18,246,940 $ 18,247 $ 1,153,064 $ 195,346 $1,366,657
========= ======= ========== ========= =========== =========== ==========
The accompanying notes are an integral part of the financial statements.
5
</TABLE>
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Three Months
Ended Ended
June 30 June 30
1997 1996
--------- ---------
Cash Flows from Operating Activities:
Net income $ 49,753 $ 257,133
Adjustments to reconcile net
loss to net cash used
in operating activities
Depreciation 11,193 11,867
Increase (decrease) in accounts
payable and accrued expenses 89,084
(51,052)
Decrease in accounts receivable 151,635 289,608
Decrease (increase) in inventory (52,701) 11,179
Stock issued for services 85,000 --
Other, net (26,244) 1,000
--------- ---------
Net Cash Provided by Operating
Activities 307,720 519,735
--------- ---------
Cash Flows from Investing Activities:
(Acquisition) of investments -- (68,946)
(Acquisitions) of property and
equipment (2,348) (20,000)
--------- ---------
Net Cash (Used in) Investing
Activities (2,348) (88,946)
--------- ---------
Cash Flows from Financing Activities:
Dividends paid (400,000) (657,893)
Common stock issued 514,609 --
--------- ---------
Net Cash (Used in)
Financing Activities 114,609 (657,893)
--------- ---------
Increase (decrease) in cash 419,981 (227,104)
Cash, Beginning of Period 336,843 772,805
--------- ---------
Cash, End of Period $ 756,824 $ 545,701
========= =========
Interest Paid $ -- $ 1,624
========= =========
Income Taxes Paid $ -- $ --
========= =========
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Six Months
Ended Ended
June 30 June 30
1997 1996
--------- ---------
Cash Flows from Operating Activities:
Net income $ 459,587 $ 703,995
Adjustments to reconcile net
loss to net cash used
in operating activities
Depreciation 21,683 23,733
(Decrease) in accounts payable
and accrued expenses (4,743) (84,989)
Decrease in accounts receivable 7,015 25,937
Decrease in inventory 68,690 18,562
Stock issued for services 340,000 --
Other, net (33,233) 17,863
--------- ---------
Net Cash Provided by Operating
Activities 858,999 705,101
--------- ---------
Cash Flows from Investing Activities:
Sale of investments -- 13,993
(Acquisitions) of property and
equipment (22,040) (5,040)
--------- ---------
Net Cash Provided by (Used in)
Investing Activities (22,040) 8,953
--------- ---------
Cash Flows from Financing Activities:
Dividends paid (715,143) (627,097)
Common stock issued 514,609 --
--------- ---------
Net Cash (Used in)
Financing Activities (200,534) (627,097)
--------- ---------
Increase in cash 636,425 86,957
Cash, Beginning of Period 120,399 458,744
--------- ---------
Cash, End of Period $ 756,824 $ 545,701
========= =========
Interest Paid $ -- $ 1,963
========= =========
Income Taxes Paid $ -- $ --
========= =========
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
SSI CAPITAL CORP. AND CONSOLIDATED SUBSIDIARY
---------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1997 and 1996
(1) Organization
------------
SSI Capital Corp. (SSI) a New York corporation, was incorporated on
January 30, 1981. SSI originally had a November 30 year end but has
recently changed to a December 31 year end.
OraLabs, Inc. (ORALABS), a Colorado corporation was incorporated on
August 10, 1990. ORALABS is in the business of manufacturing and
distributing lip balm and fresh breath products. ORALABS has selected
December 31 as its fiscal year end. ORALABS is a wholly-owned
subsidiary of SSI.
The consolidated financial statements include the accounts of ORALABS
and the accounts of SSI since the reverse acquisition. All
intercompany accounts and transactions have been eliminated.
(2) Unaudited Statements
--------------------
The balance sheet as of June 30, 1997, the statements of income and
the statements of cash flows for the three and six month periods ended
June 30, 1997 and June 30, 1996 and the statement of changes in
stockholders' equity for the six month period ended June 30, 1997 have
been prepared by the Registrant without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position,
results of operations and cash flows at June 30, 1997, and for all
periods presented, have been made.
(3) Business Combination
--------------------
Effective May 1, 1997 SSI and ORALABS completed a business combination
whereby ORALABS became a wholly-owned subsidiary of SSI. Prior to the
business combination, SSI had 1,749,541 shares of common stock
outstanding. An additional 250,000 shares were issued to the two
largest shareholders of SSI and one additional individual upon closing
the business combination. Effective January 1, 1997 ORALABS issued
shares of its common stock to two individuals for services which were
exchanged for 680,000 shares of SSI on May 1, 1997. Also on May 1,
1997, 14,917,399 shares of SSI were issued for the ownership of
ORALABS. As a result of these transactions, ORALABS became a
wholly-owned subsidiary of SSI. Since the former controlling
shareholders of ORALABS own approximately 85% of SSI after the
business combination, the transaction has been accounted for as a
8
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1997 and 1996
(3) Business Combination, Continued
-------------------------------
reverse acquisition.The net monetary assets of SSI at the time of the
reverse acquisition of approximately $189,609 have been accounted for
as issuance of stock and additional paid-in capital.
(4) Income Taxes
------------
Prior to completion of the business combination, ORALABS had elected
to be taxed under Subchapter S of the Internal Revenue Service Code.
The election was automatically terminated effective May 1, 1997. No
provision for income taxes was record prior to May 1, 1997 since
shareholders of ORALABS included the net income from the company on
their personal returns and were responsible for the payment of the
related income taxes. ORALABS had $171,786 of undistributed earnings
on May 1, 1997 which has been reclassified in the financial statements
from retained earnings to additional paid-in capital. This treatment
assumes a constructive distribution to the owners followed by a
contribution to the capital of the Company.
9
<PAGE>
SSI CAPITAL CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
(Unaudited)
December 31, November 30,
1996 1996
--------- -----------
Current Assets
Cash in bank $ 192,646 $ 193,002
--------- ---------
Total Assets $ 192,646 $ 193,002
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accrued expenses $ 27,760 $ 27,584
--------- ---------
Total Current Liabilities 27,760 27,584
--------- ---------
Stockholders' Equity:
Preferred stock - $.01 par value
1,000,000 shares authorized
none issued and outstanding -- --
Common stock - $.001 par value,
100,000,000 shares authorized;
1,749,541 shares issued and
outstanding 1,749 1,749
Additional paid-in capital 182,066 182,066
Retained earnings (18,929) (18,397)
--------- ---------
Total Stockholders' Equity 164,886 165,418
--------- ---------
Total Liabilities and
Stockholders' Equity $ 192,646 $ 193,002
========= =========
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
SSI CAPITAL CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(Unaudited)
For the One
Month Period
Ended
December 31,
1996
-----------
Cash Flows from Operating Activities:
Net loss $ (532)
Changes in operating liabilities:
Increase in accrued expenses 176
----------
Net Cash (Used by) Operating Activities (356)
---------
Cash, Beginning of Period 193,002
---------
Cash, End of Period $ 192,646
---------
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
SSI CAPITAL CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
(Unaudited)
For the One
Month Ended
December 31,
1996
-----------
Revenue:
Interest income $ 651
----------
Expenses
Legal and professional 731
Transfer fees 142
Storage 167
Miscellaneous 26
Other 117
---------
Total Expenses 1,183
---------
Net Loss (532)
=========
Loss per Share $ nil
=========
Weighted Average Number of
Common Shares Outstanding 1,749,541
=========
12
<PAGE>
SSI CAPITAL CORP.
NOTES TO FINANCIAL STATEMENTS
December 31, 1996
(1) Organization
------------
SSI Capital Corp. (SSI) a New York corporation, was incorporated on
January 30, 1981. SSI originally had a November 30 year end and has
changed its year end to December 31. This financial statement has been
prepared for the one month transition period related to the change in
fiscal year end.
(2) Unaudited Statements
--------------------
The balance sheet as of December 31, 1996, the statement of operations
and the statement of cash flows for the one month period ended December
31, 1996 have been prepared by the Registrant without audit. In the
opinion of management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the financial
position, results of operations and cash flows at December 31,1996, and
for the one month period there ended, have been made.
13
<PAGE>
ITEM 2
------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION
The following discussion of the financial condition and results of
operations of the Company relates to the three (3) months ended June 30, 1996
and 1997, the six (6) months ended June 30, 1996 and 1997, and the transition
month of December 1996, and should be read in conjunction with the financial
statements and notes thereto included elsewhere in this Report. Certain
statements in this Report are forward-looking. Actual results of future events
could differ materially. Among the factors that could cause actual results to
differ are the timely availability and acceptance of new products, the impact of
competitive products and pricing and the lack of long-term contracts with
distributors and purchasers.
Termination of Status as Subsidiary-S Corporation.
- --------------------------------------------------
The filing of this quarterly report is the first periodic report being
filed by the Company which reflects the consolidation of the Company with its
wholly-owned subsidiary, OraLabs, Inc. (the "Subsidiary"). This structure was
created as a result of the business combination (commonly referred to as a
reverse triangular merger) between the Company and the Subsidiary which closed
on May 1, 1997, and which was reported upon in Forms 8-K previously filed. Until
the closing of the transaction, the Subsidiary was an S Corporation, which was
changed to a regular C Corporation effective with the closing of the merger on
May 1, 1997. This change has an impact in various parts of the financial
statements, including: (i) distributions previously made to shareholders of the
S Corporation are recharacterized as dividends in the consolidated financial
statements, (ii) there was no accrual for income taxes while the Subsidiary was
an S Corporation (as income is passed for tax purposes directly to the
shareholders); and (iii) the reclassification of undistributed S Corporation
earnings during the periods covered by the financial statements.
Results of Operations.
- ----------------------
For the Six Months Ending June 30, 1997 as Compared With the Six Months Ending
June 30, 1996.
- --------------------------------------------------------------------------------
Sales increased $551,701 (up 23.2%). We attribute this growth in part to
the introduction of our lip balm product which occurred in July 1996 and in part
to expanded international distribution.
Gross profit increased $399,467 (up 30.2%). We attribute the increase in
gross profit as a percentage of sales from 55.5% to 58.7% in part to volume
discounts from material suppliers and in part to increased automation reducing
cost of labor.
Salaries increased $97,402 (59.2%). This was the result of an increase to
additional staffing in sales and engineering.
The stock issued to two employees of the Subsidiary for services in the
amount of $340,000 is a non-recurring item. The employees' services are in the
areas of human resources and investor relations, which the Subsidiary was
required to address as part of preparing for its entry into the public
marketplace.
14
<PAGE>
Gain on sale of securities decreased by $91,875. This was a result of the
Company's distributing substantially all of its securities held for investment
prior to year end 1996 and maintaining cash in liquid money markets in 1997.
The Company was an S Corporation through April 30, 1997, with net income
passing through to the owners' personal income. Effective May 1, 1997, the
Company converted to a C Corporation. The $123,576 of income taxes reflects the
accrual of two months of income taxes through June 30, 1997.
For the Three (3) Months Ending June 30, 1997 as Compared With the Three Months
Ending June 30, 1996
- --------------------------------------------------------------------------------
Comments above with respect to the results of operations for the
comparative six (6) month periods are similarly applicable to the comparison of
the three (3) month periods, insofar as the comments relate to the increase of
salaries, the accrual of income taxes, the stock issued for services and the
gain on sale of securities. Management devoted a considerable amount of time to
the closing of the merger during the three (3) month period ended June 30, 1997.
The Transition Period of December 1996
- --------------------------------------
After the completion of the merger, the Company changed its fiscal year
from a November year end to a December year end, resulting in a one month
transition period of December 1996 (as previously reported in a Form 8-K). In
accordance with applicable rules, the financial statements in this report
include an unaudited balance sheet, statement of cash flows and statement of
operations for the Company for the one month period of December 31, 1996. Those
statements evidence the non-activity of the Company during the month and reflect
that the total assets of the Company consisted solely of the cash in the
Company's bank account.
Liquidity and Capital Resources.
- --------------------------------
Balance Sheet as of June 30, 1997 Compared to December 31, 1996
- ---------------------------------------------------------------
Cash increased $636,425. This is primarily due to the creation of the
parent-subsidiary relationship upon closing of the merger, as approximately
$189,000 was then held by the parent and approximately $325,000 was added from
closing a private placement. The balance was primarily additional cash from
operations.
Accounts payable and accrued expenses decreased $128,319. This is a result
of inventories being higher as of December 31, 1996 than on June 30, 1997.
Additional paid-in capital increased $1,023,065. This is primarily the
result of shares issued in connection with or as part of closing the merger and
the private placement which was closed soon thereafter. The balance represents
the reclassification of undistributed S Corporation earnings in the amount of
$171,786.
15
<PAGE>
Retained earnings decreased $427,342. This is a result of reclassification
of undistributed S Corporation earnings (i.e., $171,786), net income for the six
month period ended June 30, 1997 (i.e., $459,587), and dividends paid (i.e.,
$715,143).
Impact of Inflation
- -------------------
The Company's financial condition has not been affected by the modest
inflation of the recent past. The Company believes that revenues will not be
materially effected by inflation in part because the Company's current products
are primarily very low cost, impulse items (under $0.99 cents to consumers).
16
<PAGE>
PART II - OTHER INFORMATION
Item 2 Change in Securities. (c) On May 1, 1997, the Company closed its merger
with a privately held company, OraLabs, Inc., (the "Subsidiary"), pursuant to
which the shareholders of the Subsidiary were issued a total of 15,597,399
shares of the Company's Common Stock and a total of 250,000 shares of Common
Stock were issued to the two largest shareholders of the Company and one other
accredited investor with respect to the transaction. The consideration for the
shares was the closing of the merger agreement and the shares were issued
pursuant to Sections 3(b), 4(2) and 4(6) of the Securities Act of 1933, as
amended (the "Act").
On June 5, 1997, the Company closed a private placement of 650,000 shares
of its Common Stock to a class of accredited investors. The issuance was not
registered under the Act in reliance upon the exemptions contained in Sections
3(b), 4(2), 4(6), and Regulation D.
Item No. 5. Other Information. Earlier this year, the Company changed its fiscal
year end from November to December. In accordance with the provisions of Rule
13a-10(d), this quarterly report includes information on the one month
transition period of December 1996.
Item No. 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a)
(2) Merger Agreement and Plan of Reorganization is incorporated by
reference from the Company's filing on Form 8-K (date of report, May 1, 1997).
(27) Financial Data Schedule
(b) The following reports on Form 8-K were filed during the quarter reported
upon in this report:
(i) The report filed May 14, 1997 with respect to a Date of Report of
May 1, 1997, reported upon the merger between the Company and the Subsidiary
(including the change in control of the Company and the acquisition of assets),
as well as a change in the Company's certifying accountant.
(ii) The report filed June 6, 1997, with respect to a Date of Report
of May 29, 1997, which reported upon the Company's change in fiscal year.
(iii) Amendment No. 1 filed June 30, 1997 with respect to the Form 8-K
described in paragraph (i) above. The filing included the following financial
statements: (i) OraLabs, Inc. Financial Statement and Report of Independent
Certified Public Accountants (December 31, 1996 and 1995), and OraLabs, Inc.
Financial Statements and Report of Independent Certified Public Accountants,
December 31, 1995 and 1994; (ii) unaudited, pro forma combined financial
statements respecting the Company and OraLabs, Inc., (the Subsidiary).
17
<PAGE>
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.
SSI CAPITAL CORP.
By: /s/ Gary Schlatter
----------------------------------------
Gary Schlatter, President
By: /s/ Emile Jordan
---------------------------------------
Emile Jordan, Chief Financial Officer
Dated: August 14, 1997
18
<PAGE>
EXHIBIT INDEX
(2) Merger Agreement and Plan of Reorganization is incorporated by
reference from the Company's filing May 14, 1997 on Form 8-K (date of report,
May 1, 1997).
(27) Financial Data Schedule (filed herewith)
19
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the Balance
Sheet and Statement of Income (6 month period) contained in the Form 10-Q
filed for the quarterly period ended June 30, 1997 and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 756,824
<SECURITIES> 0
<RECEIVABLES> 385,454
<ALLOWANCES> 0
<INVENTORY> 382,294
<CURRENT-ASSETS> 1,576,784
<PP&E> 158,179
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,735,113
<CURRENT-LIABILITIES> 368,456
<BONDS> 0
0
0
<COMMON> 18,247
<OTHER-SE> 1,348,410
<TOTAL-LIABILITY-AND-EQUITY> 1,735,113
<SALES> 2,932,357
<TOTAL-REVENUES> 2,932,357
<CGS> 1,212,141
<TOTAL-COSTS> 1,149,166
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 583,163
<INCOME-TAX> 123,576
<INCOME-CONTINUING> 459,587
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 459,587
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
