SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended April 30, 1996
Commission File Number 0-25296
ARISTO INTERNATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 11-2706304
- -------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
152 WEST 57TH STREET,
---------------------
NEW YORK, NEW YORK 10019
------------------------
(Address of Principal Executive Offices) (Zip Code)
(212) 586-2400
--------------
(Registrant's telephone number, including area code)
------------------------------------------------------
(Former Name and Former Address, 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.
Yes X No
----- -----
As of June 3, 1996, there were 13,390,523 shares of the Registrant's
common stock outstanding.
<PAGE>
ARISTO INTERNATIONAL CORPORATION AND SUBSIDIARIES
Index
Page
----
PART I - FINANCIAL INFORMATION
Item 1 (a) Consolidated Balance Sheets as of April 30,
1996 and October 31, 1995.........................3
(b) Consolidated Statement of Operations for the
Three Months Ended April 30, 1995 and 1996;
Six Months Ended April 30, 1995 and 1996 and
Cumulative since June 4, 1990 ....................4
(c) Consolidated Statements of Cash Flows for th
Six Months Ended April 30, 1996 and 1995
and Cumulative since June 4, 1990 ................5
(d) Notes to Consolidated Financial Statements........7
Item 2 Management's Discussion and Analysis of Financial
Conditions and Results of Operations..........................8
PART II - OTHER INFORMATION
Item 1 Legal Proceedings............................................11
Item 6 Exhibits and Reports on Form 8-K.............................11
SIGNATURES................................................................11
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<PAGE>
ARISTO INTERNATIONAL CORPORATION and SUBSIDIARIES
(a development stage enterprise)
Consolidated Balance Sheets
As of April 30, 1996 and October 31, 1995
<TABLE>
<CAPTION>
April 30, October 31,
ASSETS: 1996 1995
------------ ------------
(Unaudited) (Audited)
============ ============
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 440,803 $ 540,297
Restricted cash 446,168 442,430
Marketable securities 1,500
Prepaid expenses and other current assets 239,391 236,319
------------ ------------
Total current assets 1,126,362 1,220,546
Fixed assets - at cost, net 528,872 252,456
Patents, net 74,170 77,034
Capitalized software, net 7,330,311 7,907,937
Goodwill, net 1,077,929 1,164,161
Other assets 434,261 426,195
------------ ------------
Total assets $ 10,571,905 $ 11,048,329
============ ============
LIABILITIES and STOCKHOLDERS' EQUITY:
Current Liabilities:
Accounts payable and accrued expenses $ 1,035,335 $ 661,045
Notes payable - bank 406,000 406,000
Convertible term loans - stockholders 450,000 375,000
Payable to stockholder 425,000 500,000
Capital leases - current 74,352 25,313
------------ ------------
Total current liabilities 2,390,687 1,967,358
Convertible term loans - stockholders 1,260,000 565,000
Capital leases - long term 107,986 59,209
Deferred rent 151,984 158,891
------------ ------------
Total liabilities 3,910,657 2,750,458
Stockholder's equity:
Preferred stock, $.001 par value; authorized
1,000,000 shares; issued and outstanding
73,350 and 33,350, respectively 73 33
Common stock, $.001 par value; authorized
19,000,000 shares; issued and outstanding
13,260,332 and 13,199,945 respectively 13,260 13,200
Additional paid in-capital 22,256,800 21,871,438
Deferred compensation expense 0 (1,846,429)
Deficit accumulated during the development stage (15,608,885) (11,740,371)
------------ ------------
Total stockholders' equity 6,661,248 8,297,871
------------ ------------
Total liabilities and stockholders' equity $ 10,571,905 $ 11,048,329
============ ============
</TABLE>
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<PAGE>
ARISTO INTERNATIONAL CORPORATION and SUBSIDIARIES
(a development stage enterprise)
Consolidated Statements of Operations
For the Three Months Ended April 30, 1996 and 1995;
Six Months Ended April 30, 1996 and 1995 and
Cumulative since June 4, 1990
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
April 30, April 30,
---------------------------- ---------------------------- Cumulative
1996 and 1995 1996 1995 Since
------------ ------------ ------------ ------------ June 4, 1990*
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Royalty revenue $ 1,655 $ (29) $ 3,202 $ 1,760 $ 120,201
Production revenue 142,513 182,836 331,136
------------ ------------ ------------ ------------ ------------
Total revenue 144,168 (29) 186,038 1,760 451,337
Selling, general and administrative expenses (1,503,593) (641,097) (2,575,295) (1,217,294) (12,032,726)
Research and development expenses (843,439) -- (1,513,294) (21) (3,136,147)
Interest expense (17,264) (26,544) (88,456) (40,257) (322,601)
Interest and other income 11,484 (11,374) 20,037 81,753 128,786
------------ ------------ ------------ ------------ ------------
Net loss (2,208,644) (679,044) (3,970,970) (1,174,059) (14,911,352)
Dividends on preferred stock (11,551) -- (15,402) -- (19,987)
------------ ------------ ------------ ------------ ------------
Net loss applicable to common shareholders $ (2,220,195) $ (679,044) $ (3,986,372) $ (1,174,059) $(14,931,338)
============ ============ ============ ============ ============
Weighted average number of common
shares outstanding 13,375,472 9,309,039 13,375,472 9,309,039
============ ============ ============ ============
Net loss per share ($ 0.17) ($ 0.07) ($ 0.30) ($ 0.13)
============ ============ ============ ============
</TABLE>
* Excludes cumulative losses of The Astro-Stream Corporation of 4795,405 a the
time of the Merger.
-4-
<PAGE>
ARISTO INTERNATIONAL CORPORATION and SUBSIDIARIES
(a development stage enterprise)
Consolidated Statements of Cash Flows
For the Six Months Ended April 30, 1996 and 1995 and
Cumulative since June 4, 1990
<TABLE>
<CAPTION>
Six Months Ended
April 30, Cumulative
---------------------------- Since
1996 1995 June 4, 1990
------------ ------------ ------------
(Unaudited) (Unaudited) (Unaudited)
------------ ------------ ------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss during development stage $ (3,970,970) $ (1,174,059) $(14,911,351)
Adjustments to reconcile net loss to net cash used in
operating activites:
Depreciation and amortization 732,575 12,264 1,273,177
Expenses paid by issuance of common stock 2,750 1,228,623
Deferred rent (6,907) (6,907) 151,984
Loss on disposal of fixed asset 19,200
Net realized loss on sale of marketable securities 38 51,883
Net unrealized loss (gain) on marketable securities 21,131 (7,713)
Changes in assets and liabilities:
Increase in prepaid expenses and other current assets (3,072) (111,504) (183,358)
Increase (decrease) in accounts payable and accrued expenses 374,293 (57,857) 891,247
------------ ------------ ------------
Net cash used in operating activities (2,871,293) (1,316,932) (11,486,308)
------------ ------------ ------------
Cash flows from investing activities:
Investment in Borta, Inc., net of cash acquired (238,615)
Expenditures for equipment, leasehold inprovements, patents and
organization costs (342,270) (14,645) (688,517)
Purchase of marketable securities (893,762) (1,517,601)
Sales of marketable securities 1,462 100,401 1,473,431
Purchase of computer software (110,000)
Increase in other assets (8,068) (1,580,469) (178,707)
Increase in restricted cash (3,738) (446,168)
------------ ------------ ------------
Net cash used in investing activities (352,614) (2,388,475) (1,706,177)
------------ ------------ ------------
Cash flows from financing activities:
Net proceeds from notes payable - bank 359,857
Proceeds from notes payable - stockholders 793,500
Repayments of notes payable - stockholders (75,000) (418,500)
Capital leases 97,815 182,337
Proceeds acquired in connection with the Astro-Stream merger 59,494
Proceeds from issuance of preferred stock 220,000 320,050
Proceeds from issuance of common stock 1,927,000 3,890,555 9,481,537
Proceeds (repayments) from convertible term loans 970,000 (325,000) 2,935,000
Purchase of treasury stock (60,000)
Dividends on preferred stock (15,402) (19,987)
------------ ------------ ------------
Net cash provided by financing activities 3,124,413 3,565,555 13,633,288
------------ ------------ ------------
Net (decrease) increase in cash and cash equivalents (99,494) (139,852) 440,803
Cash and cash equivalents, beginning of period 540,297 502,993
------------ ------------ ------------
Cash and cash equivalents, end of period $ 440,803 $ 363,141 $ 440,803
============ ============ ============
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 82,268 $ 40,257 $ 290,108
============ ============ ============
Income taxes $ 7,859 $ 3,385 $ 31,554
============ ============ ============
</TABLE>
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<PAGE>
ARISTO INTERNATIONAL CORPORATION and SUBSIDIARIES
(a development stage enterprise)
Consolidated Statements of Cash Flows
Supplemental Schedule of noncash investing and financing activities:
On June 4, 1990, the Company issued 3,334,780 shares of common stock in
exchange for techical know-how and patents valued at $600,000.
During October 1993, the Company issued 39,184 shares of common stock in
exchange for the rights to a patent valued at $50,000.
During 1994, notes payable of $250,000 and $12,064 of accrued interest thereon
were converted into 171,741 shares of common stock.
During 1994, a note payable of $200,000 was converted into 159,236 shares of
common stock.
During 1994, the Company retired 1,667,390 shares of treasury stock valued at
$60,000.
During 1995, convertible term loans of $1,025,000 were converted into 834,529
shares of common stock.
During 1995, the Company issued 115,050 shares of common stock in exchange for
original graphic illustrations valued at $255,555.
During 1995, the Company issued 25,000 shares of common stock in exchange for
consulting services valued at $162,500.
During 1995, the company issued 4,082 shares of common stock in exchange for
consulting services valued at $23,372.
During December 1995, convertible term loans of $200,000 were converted into
66,667 shares of common stock.
During January 1996, the Compay issued 500 shares of common stock in exchange
for consulting services valued at $2,750.
-6-
<PAGE>
Notes to Consolidated Financial Statements
Note 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with the instructions for Form 10-QSB and Regulation S-B
related to interim period financial statements, and, therefore, do not include
all information and footnotes required by generally accepted accounting
principles. However, in the opinion of management, all adjustments (consisting
of normal recurring adjustments and accruals) considered necessary for a fair
presentation of the financial position of the Company at April 30, 1996 and
1995, have been included. The results of operations for the interim period are
not necessarily indicative of the results that may be expected for the entire
year. Reference should be made to the annual financial statements, including
footnotes thereto, included in the Company's Annual Report on Form 10-KSB for
the fiscal year ended October 31, 1995.
Note 2 - SUBSEQUENT EVENTS
As of June 5, 1996, the Company's backlog was approximately $2.0 million. The
Company includes in its backlog all orders booked through a valid purchase
order, but not shipped. Product orders in the Company's backlog can extend over
a period as long as six months and are subject to changes in delivery schedules
and cancellation at the option of the purchaser without significant penalty.
Accordingly, backlog at any particular date may not be a reliable measure for
any future period. See Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Subsequent to April 30, 1996, the Company entered into subscription agreements
to issue and sell 97,000 shares of common stock in exchange for $533,500 in
cash. As of June 10, 1996 all subscription amounts have been received.
Additionally, the Company has received $516,500 as consideration for options to
purchase 61,000 shares of common stock which the optionee may call for the
consideration to be returned at any time during the period beginning 45 days
after the date of the option and ending on various dates in August and September
1996.
On May 15, 1996 holders of all issued and outstanding shares of the Company's
preferred stock converted their shares of preferred stock into common stock, at
a conversion price of $5.50 per share. The 73,350 preferred shares have been
converted into 58,191 common shares. All dividends on the preferred shares have
been paid to the date of conversion.
On May 13, 1996 the Company, Ron Borta and Leslie Davis completed an agreement
in principle which provides for, among other things, the resignation of Ron
Borta and Leslie Davis as officers and directors of Borta, Inc. In connection
therewith, Mr. Borta and Ms. Davis will surrender all options to purchase common
stock previously granted to either of them, and Mr. Borta will surrender 357,143
restricted shares of common stock previously granted to him, together with any
options, incentive payments or rights related thereto. In connection with
severance benefits the Company will pay to each of Mr. Borta and Ms. Davis eight
months salary, based on their current rates of pay, over a six month period with
the remaining balance payable on December 31, 1996. In addition, $425,000
remaining to be paid to Ron Borta pursuant to his signing bonus with the Company
will be payable $5,000 upon the execution of definitive agreements relating to
the resignations, $150,000 in August 1996, and the balance on December 31, 1996.
Mr. Borta will continue to be available to serve as a consultant to the Company,
for no additional compensation, for up to 15 hours per month until July 31,
1996.
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<PAGE>
Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Overview
The Company designs and develops game, music and entertainment products which
take advantage of the increasingly widespread availability of telephone-based
computer networks, such as the Internet and its World Wide Web. The Company's
products will be accessed at out-of-home locations through proprietary terminals
linked to the Internet and at home through CD-ROM software available through
retail and other channels of distribution.
From inception to April 30, 1996, the Company's operating activities related
primarily to recruiting personnel, raising capital, purchasing operating assets
and performing research and development. The Company now intends to focus on the
refinement of its networking systems and game software, and the launching of its
out-of-home networked games and entertainments, and at-home game and
entertainment software.
The Company has only a limited operating history upon which an evaluation of the
Company and its prospects can be based. The Company's networked entertainment
products are still being developed and have not generated any revenues to date.
To date, substantially all of the Company's revenues have been attributable to
services and products other than the networked entertainment products currently
focused upon by the Company. The Company's future financial performance will
depend in large part upon the successful development, introduction and customer
acceptance of its networked entertainment products.
During the next twelve months, the Company expects to continue the development
of terminals and software for its interactive, networked entertainment products.
The Company will be dependent upon distributors for the sale of its out-of-home
entertainment terminals and software, and on relationships with distributors and
software publishers for access to existing distribution systems for at-home
software.
The Company's employee base grew from ten full-time employees in fiscal 1994 to
approximately fifty full-time employees by early 1996. Continued expansion will
occur primarily in the areas of networking systems and game engineering and
graphics, which will increase the design and development capabilities for
networked multiplayer games and entertainments.
History
On May 3, 1995, Aristo International Corporation, a New York corporation (the
"Predecessor"), was merged (the "Merger") with and into the Company, which was
then known as "The Astro-Stream Corporation." The Company was the surviving
corporation in the Merger and, pursuant to the Merger, the name of the Company
was changed to "Aristo International Corporation." Prior to the Merger, the
Company had no operations. The Predecessor was incorporated in 1990 to invest in
licensable and patentable consumer products for the mass market. From late 1994
until the effective date of the Merger, the Predecessor (and since the Merger,
the Company) has conducted its business as described above.
On July 31, 1995, the Company acquired 100% of the outstanding capital stock of
Borta, Inc., an entertainment software engineering and development company (the
"Acquisition").
General
The Company's revenues historically have been comprised of software development
fees and royalties on software products. Cost of revenue, which includes the
salaries of the software programmers and engineers, as well as depreciation of
the fixed assets used in the development of the software, are included in
research and development.
Revenue from software development contracts is recognized when prescribed
milestones, as defined in the specific contracts, are reached. Royalties on
software are recognized as earned.
The Company's financial statements do not contain a provision for income tax
expense from its inception through April 30, 1996 as the Company has incurred
operating losses since inception. The Company has paid minimum state and local
taxes during the years, as required. As of October 31, 1995, the Company had
available unused net operating loss carry forwards of approximately $9.8
million. These tax benefits, which may provide future tax benefits, expire in
the period from 2006 to 2010 and may be subject to limitations under 382 of the
Internal Revenue Code. The Company has fully reserved these potential future tax
benefits.
-8-
<PAGE>
Comparison of the six months ended April 30, 1996 vs. April 30, 1995
Consolidated revenues for the six months ended April 30, 1996 were $186,038, an
increase of $184,278 as compared to the same period in 1995. Revenues from the
development of software represented 98% of the 1996 revenues. Royalties on the
Company's consumer products represented 2% of revenues in 1996 compared to 100%
of revenues in 1995.
Selling, general and administrative expenses for the six months ended April 30,
1996 increased to $2,575,295 from $1,217,294 for the six months ended April 30,
1995. Approximately 17%, or $234,188 of the increase in selling, general and
administrative expense was due to an increase in travel and related expenses.
This increase was the result of visits to potential digital entertainment
acquisition targets and travel to the Company's operating locations. Selling,
general and administrative expenses increased $262,628, or 19% as a result of
the Acquisition. Selling, general and administrative expenses at the Company's
compressed software division, which began operations in February 1996, were
$363,717 and represented 26% of the increase. Salaries and benefits increased
$302,082, or 22%, as a result of hiring additional corporate staff.
Additionally, the company provided a reserve for severance of $200,000
representing 15% of the increase in 1996.
These increases were offset by decreases in professional and consulting fees.
Accounting expenses decreased by $91,748, primarily due to the absence of
services relating to the Merger during 1996. Legal fees decreased by $56,541 or
4%, primarily due to the absence of services relating to the Merger offset, in
part, by increased legal services relating to transactions in the digital
entertainment marketplace.
Research and development expenses increased to $1,513,294 for the six months
ended April 30, 1996 from $21 for the six months ended April 30, 1995. The
increase is attributable to the development of networked game technology and
design of networked and multiplayer games.
Interest and other income (expense) - net decreased $109,915 to a net expense of
$(68,419) for the six months ended April 30, 1996 from net income of $41,496
during the same period in 1995. The decrease is primarily due to an increase in
interest expense in 1996 of $48,199 as a result of additional borrowing offset,
in part, by an increase in interest income of $13,426 and a gain in 1995 from
the settlement of a lawsuit in the amount of $76,466 which did not recur in
1996.
Comparison of Quarter Ended April 30, 1996 vs. April 30, 1995
Consolidated revenues for the three months ended April 30, 1996 were $144,168,
vs. $(29) for the same period in 1995. Revenues from the development of software
represented 99% of the 1996 revenues. Negative revenue was recorded during 1995
due to an adjustment of commissions owed on royalties from the Company's
consumer products.
Selling, general and administrative expenses for the three months ended April
30, 1996 increased to $1,503,593 from $641,097 for the three months ended April
30, 1995. Approximately 19%, or $167,426, of the increase in selling, general
and administrative expense was due to an increase in travel and related
expenses. This increase was the result of visits to potential interactive
multimedia acquisition targets and travel to the Company's operating locations.
Selling, general and administrative expenses increased $106,706 or 12% as a
result of the Acquisition. Selling, general and administrative expenses at the
Company's compressed software division, which began operations in February 1996,
were $363,717 and represented 42% of the increase. Salaries and benefits
increased $159,394 or 18% as a result of hiring additional staff.These increases
were offset by decreases to professional and consulting fees. Accounting
expenses decreased $10,984 or 1% primarily due to services relating to the
Merger incurred in 1995, including an audit for the three fiscal years ended
October 31, 1994. Legal fees decreased by $38,298 or 4% primarily due to
services relating to the Merger offset, in part, by increased legal services
relating to transactions in the interactive multimedia marketplace.
Research and development expenses were to $843,439 for the three months ended
April 30, 1996 vs. Zero for the three months ended April 30, 1995. The increase
is attributable to the development of networked game technology and design of
networked and multiplayer games.
Interest and other income (expense) - net decreased to $(5,780) from $(37,918)
in 1995. The decrease in 1996 is primarily the result of interest earned upon
the maturity of certificates of deposits and monthly bank interest and the
absence of unrealized losses on marketable securities of $12,772 incurred in
1995.
-9-
<PAGE>
Liquidity and Capital Resources
Since inception, the Company has financed its activities with the sale of stock
and convertible notes for cash amounting to approximately $12,429,000 and with
the exchange of stock for approximately $934,000 in products and services. The
Company intends to use its best efforts to finance or obtain financing
sufficient for the Company's requirements.
Aristo has a revolving credit facility with a bank in the amount of $500,000.
The facility expires on May 20, 1997. As of April 30, 1996, $406,000 had been
drawn upon, of which $250,000 is collateralized by a certificate of deposit.
The Company expects to continue to increase expenditures in connection with new
product development and market expansion. Based on its available cash position,
its revolving credit facility and its demonstrated ability to raise capital
through equity financing, the Company believes that it has sufficient resources
to meet its financial requirements and operational needs over the next twelve
months.
Convertible Term Loans
On December 29, 1994, the Company issued a promissory note to a stockholder for
$500,000 in cash, and on December 29, 1995 the Company issued a new note which
replaces and supersedes the note dated December 29, 1994. Under the terms of the
new note, as amended, the note is payable in five monthly installments,
beginning on August 31, 1996. The note bears interest at a rate equal to 10% per
annum, payable on the last day of each month. The stockholder shall have the
option, until August 31, 1996, to convert the note into 90,909 shares of common
stock of the Company at an exercise price of $5.50 per share, in lieu of payment
of principal. On March 6, 1996 the holder of the note indicated its intent to
convert the note into 90,909 shares of the Company's common stock.
On July 31, 1995, the Company issued a $240,000 note ("Original Note") maturing
on December 31, 1995 plus interest of $20,000. On December 29, 1995, the Company
issued a new note ("New Note") for $260,000 which represents the principal and
accrued interest on the Original Note. The New Note replaces and supersedes the
Original Note. Under the terms of the New Note, the principal is payable on
January 1, 1997 with quarterly interest payments of $13,000 payable on April 1,
1996; July 1, 1996; October 1, 1996 and January 1, 1997. On December 29, 1995
the holder of the New Note indicated its intent to convert the New Note into
47,273 shares of common stock at a conversion price of $5.50 per share effective
January 1, 1997.
On February 12, 1996 the Company executed a $500,000 promissory note, as amended
bearing interest at twelve percent per annum, payable on July 12, 1996, the
maturity date of the note. The holder of the note, until the maturity date,
shall have the right and option to convert the note into 90,909 shares of
restricted common stock. The holder also has a continuing contractual right to
receive 12.5% of the Company's earnings before interest and taxes from licensing
of music and video onto video CD's. In certain circumstances this contractual
right is terminable by the Company and convertible into warrants to purchase
additional shares of the Company's common stock. On June 13, 1996 the holder of
the note indicated its intent to convert the note into 90,909 shares of thhe
Company's common stock.
On April 12, 1996 the Company executed a $450,000 promissory note bearing
interest at twelve percent per annum, payable on June 28, 1996. The holder of
the note shall have the right to convert the note into 89,898 shares of common
stock at any time after the date of the note and prior to December 31, 1996.
-10-
<PAGE>
PART II - OTHER INFORMATION
Item 1 - LEGAL PROCEEDINGS
Polymer Technologies, Inc. V. Aristo Intl.. Corp. The
Predecessor attempted to develop a lunch box divided
into thermostatic compartments, and for this purpose,
entered into a contract with Polymer Technologies, Inc.
to develop a prototype and then manufacture a marketable
version of the product. Polymer failed to produce a
prototype satisfying the design specifications provided
by the Predecessor. The Predecessor terminated this
project with Polymer. In May, 1993, Polymer commenced an
action in the U.S. District Court for the Southern
District of New York seeking damages in the amount of
approximately $65,000. A stipulation of settlement was
filed in this suit on April 15, 1996, pursuant to which
the Company will pay Polymer $30,000 in installments,
the last of which will be payable on June 15, 1996.
Item 6 - 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 authorized and caused the undersigned to sign this
Report on the Registrant's behalf.
Dated: June 13, 1996
ARISTO INTERNATIONAL CORPORATION
(formerly known as The Astro-Stream Corporation)
By: /s/ Mouli Cohen
-----------------------
Mouli Cohen
President
By: /s/ Edward J. Hughes
-----------------------
Edward J. Hughes
Chief Financial Officer
-11-
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000782145
<NAME> ARISTO INTERNATIONAL CORPORATION
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-START> NOV-01-1995
<PERIOD-END> APR-30-1996
<CASH> 440,803
<SECURITIES> 0
<RECEIVABLES> 94,160
<ALLOWANCES> (35,000)
<INVENTORY> 0
<CURRENT-ASSETS> 1,126,362
<PP&E> 658,190
<DEPRECIATION> (129,318)
<TOTAL-ASSETS> 10,571,905
<CURRENT-LIABILITIES> 2,390,687
<BONDS> 0
0
73
<COMMON> 13,260
<OTHER-SE> 6,647,915
<TOTAL-LIABILITY-AND-EQUITY> 10,571,905
<SALES> 182,836
<TOTAL-REVENUES> 186,638
<CGS> 0
<TOTAL-COSTS> 4,088,589
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 88,456
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,986,372)
<EPS-PRIMARY> (0.30)
<EPS-DILUTED> 0
</TABLE>
