SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities & Exchange Act of 1934
Date of Report: May 8, 1997
MT. OLYMPUS ENTERPRISES, INC.
(Exact name of registrant as specified in charter)
UTAH 33-11795 87-0441351
(State or other jurisdiction (Comission File Number) (IRS Employer I.D No.)
of Incorporation)
5110 South 800 East, Murray, UT 84117
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (801) 262-2265
PLEASE SEND A COPY OF ALL CORRESPONDENCE
OR RESPONSES TO COUNSEL FOR REGISTRANT AT:
Mr. Julian D. Jensen
311 South State, Suite 380
Salt Lake City, UT 84111
Telephone of Counsel for Registrant, including Area Code: (801) 531-6600
<PAGE>
ITEM 2. Acquisition of Assets
On April 24, 1997, Mt. Olympus Enterprises, Inc. (hereinafter sometimes
referred to as "MOE," the "Registrant," or "the Company") entered into a
Preliminary Letter of Intent for reorganization with a privately-held Texas
corporation known as Afritel Telecommunications, Inc. of Houston, Texas
hereinafter "Afritel"). A copy of this Preliminary Letter of Intent is attached
ereto as Exhibit "A" and incorporated by this reference. The general purpose of
the reorganization will be what is sometimes commonly described as a "reverse
acquisition" wherein MOE will acquire all of the issued and outstanding stock of
Afritel pursuant to a forty three-to-one (43:1) reverse split of the presently
issued and outstanding four million three hundred thousand (4,300,000) shares of
the Company, which would result in there being one hundred thousand (100,000)
shares of MOE outstanding prior to the acquisition. The Company would then
issue four million five hundred thousand (4,500,000) shares subsequent to the
reverse split to the Afritel shareholders, and an additional five hundred
thousand (500,000) reverse split shares to certain related parties or
affiliates acting as agents or consultants for the consummation of this
transaction. The Company intends to change its name to Afritel, elect a new
Board of Directors as nominated by the current Afritel management, and adopt,
as its principal business, the development and marketing of telecommunication
systems in Zaire, and/or other developing African nations.
The following purports to be an outline of what management of MOE
believes to be the most significant aspects of the proposed reorganization, but
which outline is not a complete or detailed enumeration of all points contained
inthe attached and incorporated Preliminary Letter of Intent, which should be
reviewed by any interested person examining this 8-K Report:
1. It is believed that the reorganization will provide a potential for an
active business purpose, which the Company has lacked for an extended period of
time. However, in order to acquire the development-stage business ("Afritel"),
each of the present shareholders of the Company will have to incur a substantial
dilution in their sharehold position through the approximate 43:1 reverse
split,and the subsequent issuance of an almost equal number of reverse split
shares (4,500,000) to the present shareholders of Afritel. It is anticipated
that subsequent to, and in the event of, the approval of the reorganization,
all present shareholders would collectively own approximately two percent
(2%) of the issued and outstanding shares of the Company.
2. In additional to the 4,500,000 shares being issued to the Afritel
shareholders, 500,000 shares will be issued to Mr. Dennis G. Madsen, who has
acted as a Finding and Negotiating Agent for the Company, in consideration for
completion of the reorganization activities and forgiveness of obligations owing
by the Company to Mr. Madsen. While Mr. Madsen is not an officer or director,
he has been designated by the Board of Directors as an Agent and has worked
closely in negotiating and presenting for Board approval all of the terms and
provisions of the proposed reorganization. As a result, Mr. Madsen should be
considered as an "affiliate" of the Company. It is not anticipated that Mr.
Madsen will retain all of the 500,000 shares, and will cause certain of these
shares to be issued to certain prior officers, directors and other prior
affiliates of the Company. Further, certain of these shares are pledged to a
third party on an "as issued" basis for providing interim funding for the
Company, see paragraph 3 below. No formal agreements exist as to
distribution of these shares, nor is there any legal requirement that shares
be distributed or assigned, except for the agreement of Mr. Madsen to a Mr.
Andrew Limpert, who has provided interim funding for the Company to retire
debts and obligations. As further consideration for the assignment of these
shares to Mr. Madsen, Mr. Madsen has agreed to cancel all of the outstanding
debts and obligations owed by the Company to Mr. Madsen in the approximate
principal amount of Nineteen Thousand Dollars ($ 19,000.00), as more
particularly set-out in the most current December, 1996 Audited Financial
Statements for the Company.
3. Reasonably concurrently with the entry of the Preliminary Letter of
Intent as to the reorganization with Afritel, the Company entered into a
Memorandum of Understanding with Mr. Madsen; whereby, Mr. Madsen has
personally guaranteed to retire and discharge all present outstanding debts and
obligations of the Company, as required by the Reorganization Agreement. Mr.
Madsen then arranged for interim funding supplied by a Mr. Andrew Limpert. In
exchange, Mr. Limpert has been promised by Mr. Madsen an assignment of a
percentage of the 500,000 finder/agent stock to be issued to Mr. Madsen, as
described in paragraph 2, above. It should also be understood that this
finder/agent stock is subject to S-8 Registration (registration pertaining to an
owner or affiliate pursuant to a corporate stock option plan) for at least
200,000 of the total 500,000 shares. A copy of the Memorandum of Understanding,
wherein Mr. Madsen would agree to discharge all debts and obligations and
indemnify the Company from all its present debts and obligations in partial
consideration for the 500,000 shares; and, the Short Term Funding Agreement,
whereby Mr. Limpert is advancing sixty thousand dollars ($60,000.00) to
discharge such debts in participation with Mr. Madsen in the 500,000 shares are
attached hereto and incorporated as Exhibits "B" and "C," respectively. A copy
of the Board Minutes approving the foregoing transactions, including the Plan of
Reverse Acquisition, is also attached hereto as Exhibit "D."
4. It should be noted that Afritel is a start-up entity which has not
engaged in any intended business activities in the telecommunications industry
in the continent of Africa, or otherwise, and has not generated any revenues to
date. There is minimal capitalization in Afritel; and, as part of the
requirements for consummation of the reorganization, Afritel must complete an
initial Private Placement Offering to raise initial funding in the sum of five
hundred thousand dollars ($500,000.00). Further, the Company has not
obtained from Afritel preliminary financial statements, and has entered the
Preliminary Letter of Intent upon condition and understanding that Afritel
will supply preliminary financial statements prior to the execution of a
definitive reorganization agreement and the completion of the Reorganization.
It is the understanding of the Registrant that Afritel has engaged in certain
preliminary contacts and efforts to obtain licenses and rights to conduct its
intended business in Zaire, or other African nations, but has not completed
such processes.
5. It is the present opinion of counsel for Mt. Olympus Enterprises,
Inc. that, while the Company does not require shareholder approval to complete
a share acquisition of Afritel through the issuance of its shares as
contemplated by the Preliminary Letter of Intent, it will be necessary for
the current shareholders to subsequently ratify the reverse split of shares
incident to completion of such reorganization. It is further the intent of
management of MOE to present for shareholder vote, along with the election of
new Directors and ratification of the reverse split, a general non-binding
resolution for approval of the Reorganization Agreement. In all events,
shareholders will have the opportunity to effectively approve or disapprove
the reorganization by voting upon the reverse split of shares and the
election of the proposed Directors by Afritel. It is the present intent of
management of MOE to present all of these matters for shareholder vote and
approval pursuant to a Proxy Statement as soon as possible.
6. It would be the intent of present management to fully resign and
allow the election of designated Directors by Afritel, pursuant to
shareholder vote. Directors so elected would then appoint new officers. It
should then be understood that the new management of the Company will direct
the Company to engage solely and exclusively in the business purposes of
Afritel.
ITEM 5. Other Events
As indicated above, as a necessary and concurrent undertaking to the
completion of the proposed reorganization with Afritel, the Company has
concurrently entered into a Memorandum of Understanding with its affiliate, Mr.
Dennis Madsen, to fully discharge and pay all debts and obligations of the
Company as required under the Afritel Reorganization Agreement. As partial
consideration for this agreement, the Company has agreed to the 500,000 share
post-split issuance of stock to Mr. Madsen, or assigns. See more detailed
description under Item 2, above. It should be noted that this Memorandum of
Understanding does not directly involve the Company raising funds to discharge
these obligations, but has afforded Mr. Madsen an opportunity, as the agent
of the Company, to enter into an independent financing agreement with a third
party by the name of Mr. Andrew Limpert, who has advanced $60,000.00 to
discharge these obligations. The obligation and agreement of the Company as
to Mr. Limpert is that, should the reorganization not be fully consummated
with Afritel, Mr. Limpert will be fully and exclusively repaid for this loan
of $60,000.00 from the 500,000 shares of finder's stock authorized for Mr.
Madsen upon completion of the reorganization. Mr. Limpert would be entitled
to an agreed portion of the 500,000 shares from Mr. Madsen upon completion of
the Afritel Reorganization. These matters are more fully set-out in the
Memorandum of Understanding and Short Term Funding Agreement attached hereto
and incorporated as Exhibits.
The Company has recently been able to reestablish a limited trading market
as of April 25, 1997 through Alpine Securities in Salt Lake City, Utah on the
OTC Bulletin Board. A copy of this Notification of Authorization for Resumption
of Trading from the National Association of Securities Dealers is attached
hereto and incorporated by this reference as Exhibit "E." It should be noted
that the Company, pursuant to the reorganization agreement with Afritel, will
be required to develop two (2) other market makers prior to the consummation
of the reorganization. At present, the Company has no assurance that other
market makers can be obtained, but is continuing its efforts and discussions
with potential market makers.
The Company has issued a press release to be distributed through its
present market maker, Alpine Securities, and to be delivered to the business
departments of local news organizations within Salt Lake City, Utah. A form of
this press release is attached hereto and incorporated by this reference as
Exhibit "F."
ITEM 7. Financial Statements and Exhibits **
Preliminary Letter of Intent with Afritel Communications, Inc. . . . . .
Exhibit "A" Memorandum of Understanding between MOE and Dennis Madsen . . .
Exhibit "B" Short Term Funding Agreement (Madsen/Limpert) . . . . . . . . . .
Exhibit "C" Approving Resolution of the Board of Directors . . . . . . . . . . .
Exhibit "D" Notification of Authorization from NASD . . . . . . . . . . . . . .
Exhibit "E" Press Release. . . . . . . . . . . . . . . . . . . . . . . . . .
Exhibit "F" [The Preliminary Financial Statements of Afritel, Inc. are not
presently available, but will be filed as Supplements to this
8-K Form, as received.]
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
MT. OLYMPUS ENTERPRISES. INC.
/S/
L. Kent Mackay, President
5110 South 800 East
Murray, UT 84117
Date: May , 1997
** EXHIBITS FILED MANUALY PURSUANT TO FORM SE
