UNITED STATES 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 quarterly period ended June 30, 1996
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 (No fee required) for the transition period from ____________________ to
_____________________
Commission file number: 0-11734
OMAP HOLDINGS INCORPORATED
(Name of Small Business Issuer in Its Charter)
Nevada 87-0548148
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
82-66 Austin Street, Kew Gardens, New York 11415
(Address of Principal Executive Offices) (Zip Code)
(801) 575-8073
(Issuer's Telephone Number, Including Area Code)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes __ No XX
The number of shares outstanding of Registrant's common stock ($0.001 par value)
as of September 13, 1996 was 23,875,351.
<PAGE>
TABLE OF CONTENTS
PART 1
ITEM 1. FINANCIAL STATEMENTS..................................................3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.............3
PART II
ITEM 1. LEGAL PROCEEDINGS.....................................................6
ITEM 5. OTHER INFORMATION.....................................................6
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K......................................6
SIGNATURES............................................................7
INDEX TO EXHIBITS.....................................................8
<PAGE>
PART I
ITEM 1. FINANCIAL STATEMENTS
Unless otherwise indicated, the term "Company" refers to OMAP Holdings
Incorporated and its subsidiaries and predecessors. Consolidated, unaudited
interim financial statements including a balance sheet for the Company as of the
fiscal quarter ended June 30, 1996 and statements of operations, statements of
shareholders equity, and statements of cash flows for the interim period up to
the date of such balance sheet and the comparable period of the preceding fiscal
year are attached hereto as Pages F-1 through F-7 and incorporated herein by
this reference.
<PAGE>
<TABLE>
<CAPTION>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
CONSOLIDATED UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
June 30 December 31
1996 1995
--------- ---------
CURRENT ASSETS
<S> <C> <C>
Cash ............................................. $ 14,191 $ 623,306
Accounts receivable - net ........................ 607,326 1,043,012
Accounts receivable - related parties ............ 169,843 --
Accounts receivable - other ...................... 400,247 --
Inventories ...................................... 723,778 725,492
----------- -----------
TOTAL CURRENT ASSETS ... 1,915,385 2,391,810
----------- -----------
PROPERTY AND EQUIPMENT
Buildings ........................................ 1,756,930 1,754,074
Land ............................................. 567,604 567,604
Equipment and tools .............................. 1,508,012 1,500,514
Furniture and fixture ............................ 178,172 181,327
Less: accumulated depreciation ................... (1,865,285) (1,764,565)
----------- -----------
TOTAL PROPERTY AND EQUIPMENT - NET .. 2,145,433 2,238,954
----------- -----------
OTHER ASSETS
Patents and related technology - net ............. 2,078,486 2,170,833
Prepaid expenses ................................. 7,144 20,573
Goodwill ......................................... 537,910 597,678
Investment securities ............................ 426,702 426,702
----------- -----------
TOTAL OTHER ASSETS .. 3,050,242 3,215,786
----------- -----------
TOTAL ASSETS .. $ 7,111,060 $ 7,846,550
=========== ===========
</TABLE>
See notes to consolidated unaudited condensed financial statements.
F-1
<PAGE>
<TABLE>
<CAPTION>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
CONSOLIDATED UNAUDITED CONDENSED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
June 30 December 31
1996 1995
--------- ---------
CURRENT LIABILITIES
<S> <C> <C>
Accounts payable ................................... $1,163,699 $1,441,494
Notes payable - related parties .................... 69,838 542,809
Accrued expenses ................................... 234,103 108,388
Payroll taxes payable .............................. -- 448,787
---------- ----------
TOTAL CURRENT LIABILITIES ... 1,467,640 2,541,478
---------- ----------
LONG-TERM LIABILITIES
Notes payable ...................................... 35,154 --
---------- ----------
TOTAL LONG-TERM LIABILITIES .... 35,154 --
---------- ----------
TOTAL LIABILITIES .... 1,502,794 2,541,478
---------- ----------
COMMITMENTS AND CONTINGENCIES ...................... -- --
---------- ----------
STOCKHOLDERS' EQUITY
Common stock-$.001 par value: 100,000,000 shares authorized;
23,704,544 shares issued and outstanding at 6/30/96;
17,981,933 shares issued and
<S> <C> <C>
outstanding at 12/31/95 ........................ 23,705 17,982
Additional paid-in capital ..................... 13,634,169 12,569,607
Currency translation adjustment ................ (282) 17,108
Accumulated deficit ............................ (8,049,326) (7,299,625)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY ... 5,608,266 5,305,072
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ... $ 7,111,060 $ 7,846,550
============ ============
</TABLE>
See notes to consolidated unaudited condensed financial statements.
F-2
<PAGE>
<TABLE>
<CAPTION>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
CONSOLIDATED UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
----------------------------------- -----------------------------------
June 30 June 30 June 30 June 30
1996 1995 1996 1995
---------------- ---------------- ----------------- ---------------
<S> <C> <C> <C> <C>
Revenue (net of returns) ...................... $ 672,370 $ -- $ 1,526,573 $ --
Cost of revenue ............................... 511,963 -- 985,569 --
------------ ------------ ------------ ------------
Gross profit ............. 160,407 -- 541,004 --
Operating expenses:
Selling, general and administrative ......... 496,988 7,249 1,300,442 8,132
------------ ------------ ------------ ------------
Operating income (loss) ........... (336,581) (7,249) (759,438) (8,132)
Other income (expense):
Interest income ............................. 2,491 -- 2,491 --
Interest expense ............................ (9,870) -- (13,546) --
Forgiveness of debt ......................... -- -- -- --
Miscellaneous other income (expense) ........ (246) -- 96 --
Bad debt expense ............................ -- -- -- --
------------ ------------ ------------ ------------
Total Other Income (expenses) ...... (7,625) -- (10,959) --
------------ ------------ ------------ ------------
Net loss before discontinued operations ....... (344,206) (7,249) (770,397) (8,132)
------------ ------------ ------------ ------------
Gain from discontinued operations ............. -- -- -- 749
------------ ------------ ------------ ------------
Net loss before extraordinary items ........... (344,206) (7,249) (770,397) (7,383)
------------ ------------ ------------ ------------
Extraordinary items ........................... 3,108 -- 3,108 --
------------ ------------ ------------ ------------
Net loss ...................................... $ (341,098) $ (7,249) $ (767,289) $ (7,383)
============ ============ ============ ============
Income (loss) per common share
Income (loss) before discontinued operations $ (0.01) $ (0.01) $ (0.04) $ (0.01)
Income (loss) from discontinued operations .. -- -- -- --
------------ ------------ ------------ ------------
Income (loss) before extraordinary items .... (0.01) (0.01) (0.04) (0.01)
Income (loss) from extraordinary items ...... -- -- -- --
------------ ------------ ------------ ------------
Income (loss) per weighted average common share $ (0.01) $ (0.01) $ (0.04) $ (0.01)
============ ============ ============ ============
Weighted average number of common shares
used to compute net loss per common share ... $ 22,985,133 $ 827,679 $ 20,940,875 $ 827,679
============ ============ ============ ============
See notes to consolidated unaudited condensed financial statements.
</TABLE>
F-3
<PAGE>
<TABLE>
<CAPTION>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
CONSOLIDATED UNAUDITED CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
Total
Additional Currency Stockholders'
Common Stock Paid-in Translation Accumulated Equity
---------------------------------
Shares Amount Capital Adjustment Deficit (Deficit)
--------------- --------------- --------------- --------------- --------------- ---------------
Balance
<S> <C> <C> <C> <C> <C> <C>
January 1, 1996 17,981,933 $ 17,982 $ 12,569,607 $ 17,108 $ (7,299,625) $ 5,305,072
Common stock issued
for cash at $0.13/sh 5,517,584 5,518 714,482 - - 720,000
Common stock issued
for services 205,027 205 350,080 - - 350,285
Currency translation
adjustment - - - (17,390) - (17,390)
Net loss for the period
ending June 30, 1996 - - - - (767,289) (767,289)
--------------- --------------- --------------- --------------- --------------- ---------------
Balance
June 30, 1996 23,704,544 $ 23,705 $ 13,634,169 $ (282)$ (8,066,914) $ 5,590,678
=============== =============== =============== =============== =============== ===============
See notes to consolidated unaudited condensed financial statements.
</TABLE>
F-4
<PAGE>
<TABLE>
<CAPTION>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
CONSOLIDATED UNAUDITED CONDENSED STATEMENTS OF CASH FLOW
For the six months ended
June 30
-------------------------
1996 1995
-------- ------
<S> <C> <C>
Net income (loss) ................................ $ (767,289) $ (7,383)
Adjustments to reconcile net income (loss) to net
cash provided (used) by operating activities:
Depreciation and amortization ............... 238,600 --
Cancellation of stock for services .......... -- (180)
Common stock issued for services ............ 350,285 --
(Increase) decrease in:
Accounts receivable - net ................... 435,686 --
Accounts receivable - related parties ....... (169,843) 3,000
Accounts receivable - other ................. (400,247) --
Inventories ................................. 1,714 --
Prepaid expenses ............................ 13,429 --
Increase (decrease) in:
Accounts payable and accrued expenses ....... (152,080) 7,585
Notes payable - related party ............... (455,383) --
Payroll taxes payable ....................... (448,787) --
----------- -----------
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES ...... (1,353,915) 3,022
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ........................ (10,354) --
----------- -----------
NET CASH PROVIDED (USED) BY
INVESTING ACTIVITIES ........ (10,354) --
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash for previously-issued stock ............ -- 3,000
Common stock issued for cash ................ 720,000 --
Increase in long-term debt .................. 35,154 --
----------- -----------
NET CASH PROVIDED (USED) BY
FINANCING ACTIVITIES ........ 755,154 --
NET INCREASE (DECREASE ) IN CASH ................. (609,115) 22
CASH AT BEGINING OF PERIOD ....................... 623,306 85
----------- -----------
CASH AT END OF PERIOD ....... $ 14,191 $ 107
=========== ===========
</TABLE>
See notes to consoldiated unaudited condensed financial statements.
F-5
<PAGE>
OMAP HOLDINGS INCORPORATED AND SUBSIDIARIES
(FORMERLY LOGOS INTERNATIONAL, INC. AND SUBSIDIARIES)
NOTES TO CONSOLIDATED UNAUDITED CONDENSED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying consolidated unaudited condensed financial statements
have been prepared by management in accordance with the instructions in Form
10-QSB and, therefore, do not include all information and footnotes required by
generally accepted accounting principles and should, therefore, be read in
conjunction with the Company's Annual Report to Shareholders on Form 10-KSB for
the fiscal year ended December 31, 1995. These statements do include all normal
recurring adjustments which the Company believes necessary for a fair
presentation of the statements. The interim operations results are not
necessarily indicative of the results for the full year ended December 31, 1996.
2. Consulting Agreement with Canton Financial Services Corp.
On April 1, 1996, the Company renewed its Consulting Agreement with
Canton Financial Services Corporation, a Nevada corporation which provides the
Company with business consulting services ("CFSC"). CFSC assists the Company in
preparing the necessary documentation to raise capital, finding new business
operations, and conducting public and investor relations. According to the
Consulting Agreement, the Company pays CFSC a monthly fee of $20,000 or, if
higher, the fee for services actually rendered to the Company during the month
as determined by a predetermined billing schedule. The Company can pay the
consulting fee either in cash or through the issuance of restricted shares of
its Common Stock. For purposes of the Consulting Agreement, restricted shares of
the Company's Common stock are valued at the lower of one half the closing bid
price of the Company's free trading Common Stock on the last day of the month in
which services were provided or one half the closing bid price of the Company's
free trading Common Stock on the day when the shares are actually issued.
3. Changes in Common Stock
On January 9, 1996, the Company entered into a one-year Offshore
Consulting and Securities Subscription Agreement with various foreign
consultants (the "Consulting Agreement"). Pursuant to the Consulting Agreement,
the consultants are to introduce the Company to foreign investors, who can
provide the Company with needed working capital.
Between January and April 1996, the Company sold Common Stock to ten
foreign investors. These investors collectively purchased 5,500,000 shares of
the Company's Common Stock pursuant to Regulation S of the Securities Act of
1933 for $660,000 in cash. In addition, the Company issued 17,584 restricted
shares of its Common Stock to BRIA Communications Corporation, an affiliate of
the Company, in exchange for $60,000 in cash during first quarter of 1996.
During the second quarter of 1996, the Company continued to rely on the
consulting services provided by CFSC, who billed the Company $88,879 for
services rendered in the same period. The Company issued 43,270 restricted
shares of its Common Stock to settle March 1996 consulting fees owed to CFSC
totaling $69,711. As of June 30, 1996, the Company was indebted to CFSC for
services rendered in the amount of $45,617.
F-6
4. Changes in Management of Kohl
On April 1, 1996, Jacky Caille and Maurice Van Gysel resigned as
directors of Kohl. Caille and Van Gysel were the individuals who sold the
capital stock of Kohl to the Company. Their resignations were the result of a
dispute between these former directors and the Company concerning the payments
due to Caille and Van Gysel pursuant to the Agreement by which the Company
acquired Kohl. Caille and Van Gysel remained with the Company as co-general.
On May 7, 1996, Caille and Van Gysel were terminated from their
respective positions as general managers as a result of general disagreements
between the two individuals and Kohl's board of directors. Georges d'Humieres
was appointed as the general manager of Kohl immediately after the terminations
of Caille and Van Gysel.
5. Changes in Management of OMAP Holdings
On September 30, 1996, the Company received a letter of resignation from
Aster De Schrijver, the Company's chairman of the board of directors. Mr. De
Schrijver resigned from his position with the Company in order to pursue other
business opportunities. On October 2, 1996, the Company accepted Mr. De
Schrijver's resignation.
6. Additional footnotes included by reference
Except as indicated in Notes 1-5 above, there have been no other
material changes in the information disclosed in the notes to the financial
statements included in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1995. Therefore, those footnotes are included herein by
reference.
F-7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
During the 1995 fiscal year, the Company entered a series of
transactions through which it acquired technology, patents, operating
subsidiaries and other assets. On October 23, 1995, the Company acquired 100% of
the capital stock of OMAP International Incorporated, a Nevada corporation
("OII"), pursuant to a stock exchange agreement. At the time of this
acquisition, OII owned the European patent rights to a paper processing device
used in the manufacture of collators. OII also owned all issued and outstanding
shares of OMAP SA, a Belgian research and development corporation ("OSA") which
purportedly owned the prototypes to a collating machine. On December 15, 1995,
the Company acquired technology, customer lists, and other proprietary
information related to the manufacture and distribution of collators from a
German developer of paper processing technology. On the same day the Company
also acquired 99.86% of the outstanding shares of Establissements R. Kohl, a
French corporation which owns a manufacturing plant located in Calais, France
("Kohl"). These transactions are discussed at length in the Company's annual
report on Form 10-KSB for the fiscal year ended December 31, 1995 and the
following discussion should be read in conjunction with the Form 10-KSB.
As a result of these acquisitions, the Company's primary business
consists of the manufacture and distribution of industrial and consumer products
through its subsidiary Kohl. Since January 1, 1996, Kohl has manufactured and
distributed a line of paper collators which sort and staple documents. These
devices implement the patents and technology acquired by the Company during the
1995 fiscal year. Kohl also manufactures portable heaters and light fixtures,
products which Kohl produced prior to its acquisition by the Company. Finally,
Kohl is developing the prototypes for a line of portable food vending machines,
including a machine that prepares and dispenses french fries. This french fry
machine is protected by patents owned by Kohl.
At the time that the Company acquired OII, it was represented to the
Company that OSA owned the prototypes for collators which it had developed. Of
the 13,014,144 shares of the Company's common stock, par value $0.001 ("Common
Stock"), that were issued as consideration for the acquisition of OII, 7,500,000
shares constituted consideration for the capital stock of OSA. Since that time,
the Company has received conflicting information concerning what assets were
actually owned by OSA on October 23, 1995 and what OSA's net worth was on that
date. The Company is currently investigating whether or not OSA owned the assets
which it was represented to own at the time of the transaction, but no
determination has been made as of the date of this filing. If the Company
ultimately determines that OSA misrepresented the extent of its assets, the
Company will rescind the acquisition of OII, as it pertains to the acquisition
of OSA. Any rescission ultimately effected by the Company will result in the
cancellation of 7,500,000 shares of Common Stock, 6,500,000 of which were issued
to ADS Group, Ltd. (an entity controlled by the Company's former chairman of the
board of directors), and 1,000,000 of which were issued to James Tilton, the
Company's president.
<PAGE>
The Company intends that any future rescission of the agreement to
acquire OII will only apply to the portions of the agreement which pertain to
the Company's acquisition of OSA. OSA has no current operations and has filed
for bankruptcy. For these reasons the Company valued OSA at $0 on its audited
financial statements for the year ended December 31, 1995. Accordingly, the
Company anticipates that any rescission that is ultimately effected will not
have a materially adverse effect upon the operations of the Company.
As stated above, the Company acquired 99.86% of the outstanding capital
stock of Kohl pursuant to a December 15, 1995 Contract of Transfer and Exchange
of Shares with Jacky Caille and Maurice Van Gysel (the "Kohl Agreement"). Prior
to December 15, 1995, Caille and Van Gysel owned or controlled all outstanding
shares of Kohl. After the Kohl Agreement, both Caille and Van Gysel remained
with Kohl in the capacities of directors and co-general managers.
On April 1, 1996, Jacky Caille and Maurice Van Gysel resigned as
directors of Kohl. These resignations were the result of a dispute between these
former directors and the Company concerning the payments due to Caille and Van
Gysel under the December 15, 1995 Kohl Agreement. Caille and Van Gysel claimed
that they were promised registered, not restricted shares of Common Stock. They
also expressed general dissatisfaction with the past management decisions of
Kohl, but did not cite any specific disagreements with the Company or its board
of directors. Caille and Van Gysel did, however, remain with Kohl as general
managers of operations.
On May 7, 1996, Caille and Van Gysel were terminated from their
respective positions as general managers as a result of general disagreements
between the two individuals and Kohl's board of directors. Caille and Van Gysel
were the prior owners of Kohl and have a considerable amount of combined
experience with the operations of the manufacturing plant. Georges d'Humieres
replaced Caille and Van Gysel as the general manager of Kohl. Mr. d'Humieres was
appointed to this position because of his financing experience and his broad
business and governmental experience within France. However, Mr. d'Humieres
lacks the manufacturing experience and knowledge of Kohl's operations possessed
by his predecessors. Accordingly, the termination of Caille and Van Gysel will
likely have a material future effect on Kohl's operations.
The Company has received correspondence from Mr. d'Humieres indicating
that Kohl is in need of an immediate cash infusion to continue its operations.
Mr. d'Humieres has informed the Company that Kohl requires $400,000 to pay its
vendors and otherwise satisfy its short term cash needs. Mr. d'Humieres has
stated that he will consider filing for bankruptcy protection on behalf of Kohl
if this money is not received. The Company is currently attempting to raise
money on behalf of Kohl. The Company is preparing to make a private offering of
its Common Stock. The Company is also investigating alternative means of raising
capital, including attempting to sell some or all of the Company's investment
securities. The Company contracted with Williamson & Associates, a public
realtions firm, to help create investor awareness of the Company. Williamson &
Associates was also retained to assist the Company in finding debt and equity
financing.
On October 11, 1996, the Company became aware that a principal of
Williamson & Associates has been accused of securities law violations. As of the
date of this filing, the Company is not aware of the details of the accusation
and does not know how this will affect the Company's relationship with
Williamson & Associates or the Company's attempts to raise capital. The Company
was relying in large part upon the assistance of Williamson & Associates to help
the Company raise the $400,000 for Kohl. Accordingly, the Company cannot provide
any assurances that it will be able to find alternative methods of obtaining
debt or equity financing for Kohl. Kohl is the Company's only operating
subsidiary and therefore the Company's ultimate success or failure in raising
capital on behalf of Kohl will likely have a significant effect upon the future
of the Company.
<PAGE>
On April 1, 1996, the Company renewed its Consulting Agreement with
Canton Financial Services Corporation, a Nevada corporation which provides the
Company with business consulting services ("CFSC"). CFSC assists the Company in
preparing the necessary documentation to raise capital, finding new business
operations, and conducting public and investor relations. According to the
Consulting Agreement, the Company pays CFS a monthly fee of $20,000 or, if
higher, the fee for services actually rendered to the Company during the month
as determined by a predetermined billing schedule. The Company can pay the
consulting fee either in cash or through the issuance of restricted shares of
its Common Stock. For purposes of the Consulting Agreement, restricted shares of
the Company's Common stock are valued at the lower of one half the closing bid
price of the Company's free trading Common Stock on the last day of the month in
which services were provided or one half the closing bid price of the Company's
free trading Common Stock on the day when the shares are actually issued.
Results of Operations
Gross revenues for the six months ended June 30, 1996 were $1,526,573
compared to zero for the same period in 1995. The increase is attributable to
the Company's December 1995 acquisition of Kohl, which is an operating entity.
During the first and second quarter of 1995, the Company had no operations and
devoted all its efforts to locating a suitable merger and/or acquisition partner
and thus generated no revenue.
Costs of revenues increased from zero during the first six months of
1995 to $985,569 for the same period in 1996. Kohl's operations accounted for
all costs of revenues for 1996.
Gross profit was $541,004 for the first six months of 1996 and the
gross profit as a percentage of revenues was 35%. Selling, general, and
administrative expenses were $8,132 for the first and second quarter of 1995 and
$1,300,442 for the same period in 1996, of which consulting and payroll expenses
accounted for $785,413.
Operating loss was $759,438 during the first six months of 1996
compared to $8,132 for the first and second quarter of 1995. The substantial
loss in the first quarter of 1996 is primarily due to the high level of selling,
general, and administrative expenses.
Interest income was $2,491 for the six months ended June 30, 1996
compared to zero for the same period in 1995. Interest expense was $13,546 and
zero for the six months ended June 30, 1996 and 1995, respecitvely. Interest
income and expense in 1996 mostly stemmed from the normal business operations of
Kohl.
Gain from discontinued operations was zero for the first six months of
1996 compared to $749 for the same period in 1995. The Company incurred
extraordinary expenses in the amount of $3,108 during the first six months of
1996 compared to zero for 1995 and net loss was $767,289 and $7,383,
respectively
Capital Resources and Liquidity
During the second quarter of 1996, the Company continued to rely on the
consulting services provided by Canton Financial Services Corporation ("CFSC"),
a Nevada corporation. The Company issued 43,270 restricted shares of its Common
Stock to settle March 1996 consulting fees owed to CFSC totaling $69,711.
On January 9, 1996, the Company entered into a one-year Offshore
Consulting and Securities Subscription Agreement with various foreign
consultants (the "Consulting Agreement"). Pursuant to the Consulting Agreement,
the consultants are to introduce the Company to foreign investors, who can
provide the Company with needed working capital.
Between January and April 1996, the Company sold Common Stock to ten
foreign investors. These investors collectively purchased 5,500,000 shares of
the Company's Common Stock pursuant to Regulation S of the Securities Act of
1933 for $660,000 in cash. In addition, the Company issued 17,584 restricted
shares of its Common Stock to BRIA Communications Corporation, an affiliate of
the Company, for $60,000 in cash during first quarter of 1996.
<PAGE>
The Company had a net working capital of $430,157 as of June 30, 1996
compared to a working capital deficiency of $56,975 at the end of June 1995. The
main reason behind this working capital increase is Kohl's improved liquidity.
Net stockholders' deficit in the Company was $56,974 at the end of June
1995. On June 30, 1996, however, the Company enjoyed a net stockholders' equity
of $5,590,678. The main reasons for the increase are the Company's 1995
acquisition of several patents and purchase of Kohl through issuance of Common
Stock. Kohl had a positive stockholders' equity as of June 30, 1996.
PART II
ITEM 1. LEGAL PROCEEDINGS
V.K Holdings, Inc. ("VK") filed suit against the Company (Case Number
93-05193-00-0-G) on September 7, 1993 in the 319TH Judicial District Court of
Nueces County, Corpus Christi, Texas. VK alleges fraud, violation of the
securities laws, and other related causes of action. Also name defendants in the
suit are Chad Burnett, Richard Surber, and Kenneth O'Neal in their capacities as
officers and directors of the Company in November 1992, the time when the
alleged fraudulent acts took place. Based on preliminary investigation, the
Company's management believes that VK's allegations are false and unfounded. It
further believes that VK's pleadings fail to specify the acts or omissions upon
which the cause of action is premised. The Company and VK have initiated
discussions in pursuit of a settlement, and the Company is not required to file
an answer to VK's complaint until the parties determine that no settlement will
be reached. On May 16, 1996, the Court ordered that trial date be set for
January 1998, but the Company is uncertain as to whether VK will prosecute the
case at that time.
ITEM 5. OTHER INFORMATION
On October 2, 1996, the Company received a letter of resignation from
Aster De Schrijver, the Company's chairman of the board of directors. This
letter was dated September 30, 1996. At the time of his resignation, Mr. De
Schrijver did not express any disagreements with the Company or its management.
The Company has accepted Mr. De Schrijver's resignation.
On October 2 1996, the Company appointed Lawrence Derrick Ashcroft as
the Company's director.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Index to Exhibits. Exhibits required to be attached by Item 601 of
Regulation S-B are listed in the Index to Exhibits beginning on page 8
of this Form 10-QSB. The Index to Exhibits is incorporated herein by
this reference.
(b) Reports on Form 8-K. On April 22, 1996, the Company filed a Form 8-K
to report its acquisition of all the outstanding shares of OMAP
International Incorporated and Kohl SA, and its acquisition of
technology related to paper processing devices. The Form 8-K also
disclosed the change in control of the Company that was effected as a
result of these transactions.
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized this 9TH day of October 1996.
OMAP Holdings Incorporated
/s/ James Tilton
James Tilton, President
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
Signature Title Date
/s/ James Tilton Chief Executive Officer, President, October 9, 1996
- ----------------- Treasurer and Director
James Tilton
/s/ Jane Zheng Secretary and Director October 9, 1996
- -----------------
Jane Zheng
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NUMBER PAGE DESCRIPTION
3(i) * The Company's Articles of Incorporation, as restated to
reflect the October 30, 1995 Certificate of Amendment to the
Company's Articles of Incorporation, incorporated herein by
reference to the Company's annual report of Form 10-KSB
filed with the Commission on October 2, 1996.
3(ii) * The Company's Bylaws, incoporated herein by reference to the
Company's annual report on Form 10-KSB for the year ended
December 31, 1992.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
CONSOLIDATED UNAUDITED CONDENSED FINANCIAL STATEMENTS FILED WITH THE COMPANY'S
JUNE 30, 1996 QUARTERLY REPORT ON FORM 10 QSB AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCC BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000717228
<NAME> OMAP Holdings Incorporated
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-START> Jan-01-1996
<PERIOD-END> Jun-30-1996
<EXCHANGE-RATE> 1
<CASH> 14,191
<SECURITIES> 426,702
<RECEIVABLES> 1,177,416
<ALLOWANCES> 0
<INVENTORY> 726,778
<CURRENT-ASSETS> 1,915,385
<PP&E> 4,010,718
<DEPRECIATION> (1,865,285)
<TOTAL-ASSETS> 7,111,060
<CURRENT-LIABILITIES> 1,485,228
<BONDS> 0
0
0
<COMMON> 23,705
<OTHER-SE> 5,566,973
<TOTAL-LIABILITY-AND-EQUITY> 7,111,060
<SALES> 1,526,573
<TOTAL-REVENUES> 1,529,160
<CGS> 985,569
<TOTAL-COSTS> 1,300,442
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 13,546
<INCOME-PRETAX> (770,397)
<INCOME-TAX> 0
<INCOME-CONTINUING> (770,397)
<DISCONTINUED> 0
<EXTRAORDINARY> 3,108
<CHANGES> 0
<NET-INCOME> (767,289)
<EPS-PRIMARY> (0.04)
<EPS-DILUTED> (0.04)
</TABLE>
