SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended: March 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
Commission file number: 0-17304
CNH Holdings Company
(Exact name of registrant as specified in its charter)
Nevada 11-2867201
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
1420 N. Longview Street, Kilgore, TX 75662
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (903) 984-6425
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 Par Value
(Title of class)
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____
Indicate by check mark if disclosure of delinquent filers pursuant to Rule 405
of Regulation S-K is not contained herein and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
State the aggregate market value of the voting stock held by non-affiliates of
the registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within 60 days prior to the date of filing:
The common stock of registrant is listed and traded on the "Bulletin Board"
maintained by the National Association of Securities Dealers, Inc. The quoted
inside bid and asked prices for the common stock on July 6, 1998, were $1.18 and
$1.56, respectively. There were 6,950,000 common shares outstanding on that
date, of which 950,000 shares were held by non-affiliates. The aggregate market
value for the common stock on that date was, therefore, $1,301,500.
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date: As of July 6, 1998, there were
6,950,000 common shares outstanding.
Registrant has had no revenues since the fiscal year ended March 31, 1990.
Documents Incorporated by Reference: List hereunder the documents, if any,
incorporated by reference and the part of this Form 10-KSB into which the
document is incorporated: None.
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Item 1. Description of Business:
CNH Holdings Company, a Nevada corporation (the "Company"), was incorporated on
April 15, 1987, under the name of I.S.B.C. Corp. On January 28, 1988, the
Company completed an initial public offering of units consisting of one share of
the common stock of the Company ("Common Stock") and one Class A Warrant, all of
the latter of which have either expired or been exercised. On June 27, 1988, the
Company acquired all of the outstanding shares of Coral Group, Inc., a
privately-held Colorado corporation ("Coral Group"), formed in 1984 and then
principally engaged in the development and marketing of computer software
programs. During fiscal 1990, the Company formed two additional subsidiaries,
Coral Telesystems, Inc ("CTI"), and Coral Pacific, Inc. ("Pacific"), both of
which were Colorado corporations. Through the fiscal year ended March 31, 1991,
the business of the Company was conducted solely through Coral Group, CTI and
Pacific.
During fiscal 1991, the Company defaulted on all of its outstanding obligations
to its financial institution, which were secured by all of the assets of the
Company, including the shares of Coral Group, CTI and Pacific. The Company
voluntarily transferred all of the security for this debt to the financial
institution in exchange for an acknowledgment of full and complete satisfaction
of all remaining liabilities of the Company to the institution. All licenses
which the Company had regarding its software were terminated without liability
and returned to the original licensor, and all leases which the Company had were
similarly terminated without liability. Finally, all tax and accounts payable
owed by the Company were paid in full. The Company then ceased operations in the
computer software field.
On April 12, 1996, the Company held a special meeting of its board of directors
(the "Board of Directors"). The purpose of the meeting was to (i) discuss and
take action on all corporate matters which had taken place since the date of the
last meeting of the board, including the filing of all delinquent reports by the
Company with the U.S. Securities and Exchange Commission (the "Commission"),
(ii) ratify the appointment of independent Certified Public Accountants to audit
the books and records of the Company since 1990, (iii) discuss the financial
condition of the Company and implement an appropriate course of action and (iv)
discuss all other matters then pending before the Company. At the meeting, the
Board of Directors adopted a new plan of business for the Company, that being to
begin a search for a new business opportunity. In order to implement this new
plan of business, however, the Board of Directors had to implement a number of
curative measures, including the engagement of an attorney to assist in general
corporate matters and the filing of all delinquent reports with the Commission,
and the engagement of a new auditor to audit the books and records of the
Company since the fiscal year ended March 31, 1990, in order to prepare and file
all necessary federal and state income tax forms and compile the financial
information necessary for the filing of all quarterly reports by the Company
with the Commission. The foregoing resulted in the incurrence by the Company of
obligations of $381 for services performed during the first quarter of fiscal
1997, which were satisfied through the issuance of Common Stock on May 3, 1996,
to the sole executive officer of and attorney for the Company. The Company is
now current in its reports with the Commission, all tax filings have been made
with the appropriate federal and state agencies and all information concerning
the foregoing has been disseminated to the public.
On December 9, 1997, the Company entered into a reorganization Agreement (the
"DRC Reorganization Agreement") with GNC Corporation, a Nevada corporation
("GNC") and the sole shareholder of GNC, that being DRC, Inc., a Nevada
corporation ("DRC"), pursuant to which the Company agreed to acquire all of the
outstanding proprietary interest of GNC in a share-for-share exchange which
subsequently resulted in GNC becoming a wholly-owned subsidiary of the Company
and DRC acquiring control of the Company through its share ownership. The
acquisition was rescinded due to the failure by GNC and DRC to deliver the
required financial statements.
On June 15, 1998, the Company entered into a reorganization agreement (the
"Southport Reorganization Agreement") with Southport Environmental and
Development, Inc., a Nevada corporation ("Southport Environmental"), and the
shareholders of Southport Environmental pursuant to which the Company acquired
all of the outstanding proprietary interest of Southport Environmental in a
share for share exchange which resulted in Southport Environmental becoming a
wholly owned subsidiary of the Company and the shareholders of Southport
Environmental acquiring control of the Company through their share ownership.
The Company issued 6,000,000 common shares and 200,000 shares of the Class A:
10% Dividend Bearing Preferred Stock of the Company. Pursuant to the
Reorganization Agreement, the existing director, Mr. Paul M. Lionti, resigned
and the Company appointed Messrs. Larry V. Tate, Gerald Pybas, H. Paul Estey, E.
Robert Barbee and Terry McFarland as directors. Mr. Tate was then appointed CEO,
Mr. Pybas President, and Ms. Helen Wallace Treasurer.
2
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Southport Environmental owns and/or operates working and other interests in oil
and gas properties in east Texas and also has a 1/3rd interest in NSG, a joint
venture involved in the remediation of normally occurring radioactive materials
along the gulf coast of Texas and Louisiana.
Item 2. Description of Property:
The Company, during the period covered by this report, owned no real or personal
property, tangible or intangible. On the date of this report, the Company owned
all of the shares of Southport Environmental, all of which were acquired on June
15, 1998. Conversely, during the period covered by this report, the Company had
no liabilities. The executive offices of the Company are now located at 1420 N.
Longview Street, Kilgore, Texas 75662. The telephone number at this address is
(903) 984-6425.
Item 3. Legal Proceedings:
No material legal proceedings to which the Company (or any officer or director
of the Company, or any affiliate or owner of record or beneficially of more than
five percent of the Common Stock, to management's knowledge) is a party or to
which the property of the Company is subject is pending, and no such material
proceeding is known by management of the Company to be contemplated.
Item 4. Submission of Matters to a Vote of Security Holders:
There were no meetings of security holders during the period covered by this
report; thus, this item is not applicable.
Item 5. Market for Common Equity and Related Shareholder Matters:
The common stock is listed on the Bulletin Board maintained by the NASD. This
listing was only recently obtained and an active trading market for the common
stock was only recently established. On July 6, 1998, there were five market
makers in the common stock, and the closing inside bid and asked prices were
$1.18 and $1.56, respectively.
The Company has paid no dividends on the Common Stock since inception and does
not expect to pay dividends in the foreseeable future. There are, however, no
restrictions on the payment of dividends.
Item 6. Management's Discussion and Analysis of Financial Condition and Results
of Operations:
Results of Operations: The Company has had no revenues, operating or otherwise,
since the fiscal year ended March 31, 1990. Correspondingly, all expenses during
these periods were administrative in nature and immaterial in amount. Thus, no
meaningful comparison can be made between these fiscal years.
Liquidity and Capital Resources: The Company has had no liquidity sources since
fiscal 1990, other than proceeds which resulted from the exercise of options
granted in the final quarter of calendar 1997. All administrative matters were,
up to and including the period covered by this report, provided for by the
executive officer of and attorney for the Company in exchange for those shares
issued to them on May 3, 1996. In regards of the acquisition of Southport
Environmental, the Company incurred substantial obligations, all of which were
satisfied through the exercise of those options granted in the final quarter of
calendar 1997.
Compliance with Beneficial Ownership Reporting Rules: Section 16(a) of the
Securities Act of 1934, as amended ("Exchange Act"), requires the executive
officers and directors of the Company, and persons who beneficially own more
than 10% of the Common Stock, to file initial reports of ownership and reports
of changes in ownership with the Commission. These officers, directors and
shareholders are also required to furnish the Company with copies of certain of
these reports. Based solely on a review of copies of reports furnished to the
Company during its fiscal year ended March 31, 1997, and thereafter, or written
representations, if any, received by the Company from these persons that no
other reports were required, the Company believes that, during the fiscal years
ended March 31, 1991, 1992, 1993, 1994, 1995, 1996 and 1997, all applicable
Section 16(a) filing requirements were satisfied.
3
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Item 7. Financial Statements:
Halliburton, Hunter & Associates, P.C.
CERTIFIED PUBLIC ACCOUNTANTS
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors and Stockholders
CNH Holdings Company
We have audited the balance sheets of CNH Holdings Company as of March 31, 1998,
and 1997, and the related statements of income (loss) and of stockholders'
equity for the three years ended March 31, 1998. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of CNH Holdings Company as of
March 31, 1998, and 1996, and the results of its operations and shareholders'
equity for the three years ended March 31, 1998, in conformity with generally
accepted accounting principles.
The Company discontinued operations on March 31, 1991, and did not resume
operations until after March 31, 1998. Statements of cash flows have been
omitted for that reason.
Littleton, Colorado
July 6, 1998
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CNH HOLDINGS COMPANY
BALANCE SHEET
March 31,
1997 1998
ASSETS
Current Assets:
Subscriptions receivable $ -- $ 100,000
Total current assets -- 100,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities $ -- $ --
Stockholders' Equity:
Preferred Stock, $.01 par value, 1,000,000
shares authorized, no shares issued
and outstanding -- --
Common Stock, $.001 par value, 10,000,000
shares authorized, 950,000 shares issued and 400 950
outstanding on March 31, 1998, and 400,000
issued and outstanding on March 31, 1997
Additional paid-in capital 4,712,584 4,941,034
Accumulated deficit (4,712,984) (4,841,984)
----------- -----------
Total Stockholders' Equity $ -- $ 100,000
----------- -----------
See accompanying notes to financial statements.
5
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CNH HOLDINGS COMPANY
STATEMENT OF OPERATIONS
Year ended March 31,
1998 1997 1996
---- ---- ----
Revenues $ -- $ -- $ --
Operational Expenses 129,000 -- --
Income (loss) from discontinued operations -- -- --
(Loss) on termination of operations -- (381) --
--------- --------- ---------
Net income (loss) $(129,000) $ (381) $ --
========= ========= =========
Per share data
Net income (loss) $ (.2867) $ (1) $ --
========= ========= =========
Weighted average shares outstanding 400,000* 365,380* 19,228*
========= ========= =========
* Shares have been adjusted to reflect a reverse stock split effectuated on
May 30, 1996.
(1) Loss is less than $.01 per share
See accompanying notes to financial statements.
6
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<TABLE>
<CAPTION>
CNH HOLDINGS COMPANY
STATEMENT OF STOCKHOLDERS' EQUITY
Total
Common Stock Accumulated Equity
Shares Amount Deficit (Deficit)
------ ------ ------- ---------
<S> <C> <C> <C>
Balance at March 31, 1995, 19,061,245 $ 4,712,603 $ (4,712,603) --
and March 31, 1996
Issuance of common shares for 380,938,755 381 -- 381
services on May 3, 1996
Reverse 1:1000 common share (399,600,000) -- -- --
split on May 30, 1996
Net loss for the year ended
March 31, 1997 -- -- (381) (381)
------------ ------------ ------------ ------------
Balance at March 31, 1997 400,000 $ 4,712,984 $ (4,712,984) --
============ ============ ============ ============
Issuance of common shares for
services in December, 1997 100,000 4,000 -- --
Issuance of common shares for
services in December, 1997 450,000 225,000 -- --
Net loss for the year ended
March 31, 1998 -- -- (129,000) (129,000)
------------ ------------ ------------ ------------
Balance at March 31, 1998 950,000 4,941,984 (4,841,984) 100,000
------------ ------------ ------------ ------------
See accompanying notes to financial statements.
7
</TABLE>
<PAGE>
CNH HOLDINGS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1998, 1997, and 1996
1. Organization
I.S.B.C. Corp. was incorporated in Delaware on April 15, 1987. On January 29,
1988, I.S.B.C. Corp. completed a public offering of 800,000 units at a price of
$.50 per unit, consisting of one share of common stock and three redeemable
warrants. All unexercised warrants have now expired.
On June 27, 1988, I.S.B.C. Corp. issued 21,000,000 shares of its common stock in
exchange for all of the outstanding shares of Coral Group, Inc. Subsequent to
the exchange of stock, I.S.B.C. Corp. changed its name to Coral Companies, Inc.
Coral Group, Inc. was incorporated on March 12, 1984, and commenced operations
in November 1984. Coral Group, Inc.'s primary business was the marketing of
computer hardware and software as well as providing consulting services,
installation support, training programs and software maintenance for its
customers. Since the shareholders of Coral Group, Inc. owned approximately 85%
of Coral Companies, Inc. immediately after the exchange, the stock exchanges was
accounted for as a reverse acquisition of Coral Companies, Inc. by Coral Group,
Inc. The Company, subsequent to the acquisition of the Coral Group, changed its
name to CNH Holdings Company and its domicile to Nevada.
The Company previously had outstanding a class of preferred stock which was
entitled to one vote per share, was not entitled to receive any dividends that
may have been declared and had a liquidation preference of $.02 per share. The
preferred stock was previously converted to common stock, and the liquidation
preference of $220,000 was reclassified from preferred stockholders' equity to
common stockholders' equity.
On May 30, 1996, the Company effected a reverse one-for-one thousand capital
share split. Concurrently, the authorized number of common shares was increased
to 10,000,000, $.001 par value per share and 1,000,000 preferred shares, $.01
par value. After the split, there were 400,000 common shares outstanding, which
included shares of the $.001 par value common issued to individuals in exchange
for services rendered during the first quarter of fiscal 1997.
Subsequent to the fiscal year end, on June 15, 1998, the Company acquired
Southport Environmental in a share for share exchange which resulted in the
Company issuing 6,000,000 common shares and 200,000 preferred shares. Concurrent
with the acquisition, there was a change in control and the management of the
Company.
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure:
This item is not applicable to the period covered by this report.
8
<PAGE>
PART III
Item 9. Directors and Executive Officers of the Company:
The following table sets forth all current directors and executive officers of
the Company, as well as their ages:
NAME AGE POSITION WITH COMPANY *
Larry V. Tate 63 Chairman of the Board of Directors and
Chief Executive Officer
Gerald W. Pybas 51 Director and President
Helen Wallace 42 Chief Financial and Accounting Officer,
Treasurer
H. Paul Estey 64 Director
E. Robert Barbee 57 Director
Terry L. McFarland 39 Director
* No current director has any arrangement or understanding whereby they are
or will be selected as a director or nominee.
9
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The executive officers hold office until the next annual meeting of shareholders
and until their respective successors have been duly elected and qualified. The
officers are elected by the Board of Directors at its annual meeting immediately
following the shareholders' annual meeting and hold office until their death or
until they earlier resign or are removed from office. There are no written or
other contracts providing for the election of directors or term of employment of
executive officers, all of whom serve on an "at will" basis.
The Board of Directors currently consists of five members, Messrs. Larry V.
Tate, Gerald W. Pybas, H. Paul Estey, E. Robert Barbee and Terry McFarland. The
Company does not have any standing audit, nominating or compensation committees,
or any committees performing similar functions. The board will meet periodically
throughout the year as necessity dictates. Since March 31, 1990, the board has
had one meeting, which occurred during fiscal 1997.
Executive Profiles: Mr. Larry V. Tate has been Chief Executive Officer and
Chairman of the Board of Directors since June 15, 1998. Prior to that date and
currently, he served and continues to serve in similar capacities for the
entities acquired by the Company. In these capacities, Mr. Tate has been
primarily responsible for the strategic direction and day-to-day operations of
these corporations. Mr. Tate has been actively involved in the oil and gas
industry for most of his adult life. Mr. Gerald W. Pybas has been President and
a director of the Company since June 15, 1998. Prior to that date and currently,
he served and continues to serve in similar capacities for the entities acquired
by the Company. In these capacities, Mr. Pybas has been primarily responsible
for field operations. He received a Bachelor of Science Degree in 1961 and a
Masters in Geology in 1962 from the University of Oklahoma, and has been a
member of the American Association of Petroleum Geologists since 1969. Helen
Wallace has been Chief Financial and Accounting Officer since June 15, 1998.
Prior to that date and currently, she served and continues to serve in similar
capacities for the entities acquired by the Company. Ms. Wallace, from 1990 to
1997, worked for an independent oil and gase lease operator, serving as the
production clerk responsible for all regulatory filings and office to field
coordination. Mr. H. Paul Estey has been a director of the Company since June
15, 1998. He is currently the Chief Executive Officer and Corporate Radiation
Safety Officer and a director of NORM Services Group, L.L.C., having held these
positions since formation in November, 1996. Prior to this, Mr. Estey provided
services to the NORM industry, including surveying, radiation safety/protection
and regulatory compliance, license applications, project supervision, expert
testimony and treatment/disposal evaluations. Mr. E. Robert Barbee has been a
director of the Company since June 15, 1998. He is self-employed in the oil
field supply business in Kilgore, Texas. Mr. Barbee attended Kilgore College in
Kilgore from 1959 until 1961 and Stephen F. Austin State University from 1968
until receiving a Bachelors in Business Administration in 1970. Mr. Terry L.
McFarland has been a director of the Company since June 15, 1998. He is
self-employed as an independent oil producer and cattle rancher in Kilgore,
Texas.
10
<PAGE>
Item 10. Executive Compensation: No compensation has been paid since the fiscal
year ended March 31, 1990, to the Board of Directors or executive officers of
the Company in their capacities as such, other than the issuance, effective May
3, 1996, of those common shares to a former director in exchange for services
rendered during fiscal 1997, as discussed above under Items 1 and 6.
Item 11. Security Ownership of Management and Certain Others: Based upon
information which has been made available to the Company by its stock transfer
agent, the following table sets forth, as of September 5, 1997, the shares of
Common Stock owned by each current director, by directors and executive officers
as a group and by each person known by the Company to own more than 5% of the
outstanding Common Stock:
Name and Address
Title of Class of Beneficial Owner Number of Shares Percent of Class (1)
- -------------- ------------------- ---------------- --------------------
Common Stock Larry V. Tate 2,787,500 40.10% (2)
P.O. Box 464
Kilgore, TX 75663
Common Stock Gerald W. Pybas 2,312,500 33.27% (3)
P.O. Box 464
Kilgore, TX 75663
Common Stock E. Robert Barbee 225,000 3.24% (4)
P.O. Box 464
Kilgore, TX 75663
Directors and Executive 5,325,000 76.61%
Officers as a Group
(one in number):
- --------------------------------------------------------------------------------
(1) Based on 6,950,000 shares of common stock issued and outstanding on July 6,
1998.
(2) Does not include 109,100 shares of Series A Preferred Stock, none of which
is convertible into common stock. (3) Does not include 74,900 shares of
Series A Preferred Stock, none of which is convertible into common stock.
(4) Does not include 4,000 shares of Series A Preferred Stock, none of
which is convertible into common stock.
- --------------------------------------------------------------------------------
Item 12. Certain Transactions:
This item is not applicable to the period covered by this report.
Item 13. Exhibits and Reports on Form 8-K:
(a) Exhibits: None
All required exhibits were previously filed with the Registration Statements on
Form S-18 (No. 33-17008-NY) and Form S-1 (No. 33-29899) and with the Form 10-KSB
for the fiscal year ended March 31, 1996.
(b) Forms 8-K: See Attached.
11
<PAGE>
SIGNATURES
In accordance with the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Kilgore,
State of Texas on this 14th day of July, 1998.
CNH HOLDINGS COMPANY
(Registrant)
By: /s/ Larry V. Tate
--------------------------------
Larry V. Tate, Chief Executive Officer
By: /s/ Helen Wallace
--------------------------------
Helen Wallace, Chief Financial
and Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following person on behalf of the registrant in the
capacity on this 14th day of July, 1998.
/s/ Larry V. Tate /s/ Gerald Pybas /s/ E. Robert Barbee
- ----------------------- ------------------------- --------------------
Larry V. Tate, Director Gerald Pybas, Director E. Robert Barbee
/s/ H. Paul Estey /s/ Terry McFarland
- ----------------------- -------------------------
H. Paul Estey, Director Terry McFarland, Director
12
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-START> MAR-31-1997
<PERIOD-END> MAR-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 100,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 950
<OTHER-SE> (100,950)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 129,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (129,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (129,000)
<EPS-PRIMARY> (.287)
<EPS-DILUTED> (.287)
</TABLE>
