SECURITIES & EXCHANGE COMMISSION
Washington, D.C., 20549
__________________________
FORM 10-KSB/A
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
of the Securities Exchange Act of 1934
__________________________
For the Fiscal Year Ended December 31, 1997
Commission File Number: 33-21546-D
CONCORDE STRATEGIES GROUP, INC.
(Exact name of Registrant as specified in its Charter)
Colorado 84-1108035
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Ident. Number)
444 Madison Avenue, Suite 1710, New York, NY 10022
(Address of principal executive offices) (zip code)
(212) 317-0060
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 15(d) of the Act:
Title of each class
Name of each exchange
on which registered
Common Stock, no par value
None
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 the number of shares outstanding of each of
issuer's classes of common
stock, as of the latest practicable date. At April 6, 1998,
3,300,000 shares of Common
Stock, no par value were outstanding.
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of
Regulation S-K (Sec. 229.405 of this chapter) 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 [ ]
The aggregate market value of the voting stock held by
non-affiliates of registrant
on April 6, 1998 was $1,501,875. .
FORM 10-KSB
CONCORDE STRATEGIES GROUP, INC.
TABLE OF CONTENTS
Item
No. Description Page
PART I
1. Business 3
2. Properties 5
3. Legal Proceedings 6
4. Submission of Matters to a Vote
of Security Holders 6
PART II
5. Market for Registrant's Common Equity
and Related Stockholder Matters 6
6. Selected Financial Data 7
7. Management's Discussion and Analysis
of Financial Condition and Results of
Operations 8
8. Financial Statements 10
9. Disagreements on Accounting and
Financial Disclosure 24
PART III
10. Directors and Executive Officers
of the Registrant 24
11. Executive Compensation 25
12. Security Ownership of Certain
Beneficial Owners and Management 26
13. Certain Relationships and
Related Transactions 27
PART IV
14. Exhibits, Financial Statement
Schedules and Reports on Form 8-K 27
Signatures 28<PAGE>
FORM 10-KSB
CONCORDE STRATEGIES GROUP, INC.
December 31, 1997
PART I
ITEM 1. BUSINESS: Introduction
Concorde Strategies Group, Inc. ("Registrant" or the "Company" or
"Concorde") was formed under the laws of the state of Colorado
for the purpose of participating, either through acquisition or
merger, in a viable business opportunity. Registrant has since
its inception been evaluating various privately held companies
which management believed could be viable business opportunities.
On March 7, 1989, Registrant completed its initial public
offering and sold 2,000,000 Units at $0.05 per Unit, and received
total gross proceeds of $100,000. In April 1996, Registrant
declared a 1-for-10 reverse split of its common stock.
On September 23, 1996, the Company entered into an Agreement and
Plan of Reorganization pursuant to which it acquired 100 percent
of the issued and outstanding capital stock of Concorde
Management, Ltd. ("CML"). This acquisition was concluded as of
July 1, 1997.
CML had previously entered into an Agreement and Plan of
Reorganization with L'Abbigliamento, Ltd., a New York based
manufacturer and wholesale distributor of Italian made men's
clothing, on March 19, 1996. Under the terms of this Agreement,
which was completed on October 7, 1996, CML acquired all of the
outstanding shares of capital stock of L'Abbigliamento, Ltd., in
exchange for 100 percent of the shares of CML's Class A
Convertible Redeemable Preferred Stock, and L'Abbigliamento, Ltd.
became a wholly owned subsidiary of CML. CML is currently an
intermediate holding company with no independent business
operations. The discussion herein relates solely to the
activities of the Company and L'Abbigliamento, Ltd. See
"Operations of Subsidiary" below.
The holders of the 1,000 shares of Class A Preferred Stock shall
be required to convert such Class A Preferred Stock into the
Company's Common Stock or into shares of the Subsidiary, at the
holder's election, at such time as (i) the Company elects to
undertake a registration of the securities of the Subsidiary, or
otherwise elects to enter into a business combination, whether by
means of merger or acquisition or otherwise, between the
Subsidiary and a publicly held corporation so that the Subsidiary
becomes a publicly held corporation, or the subsidiary of a
publicly held corporation, or (ii) in the event that the Company
proposes to enter into any transaction which would have the
effect of selling or otherwise transferring a controlling
interest in the Subsidiary, or (iii) if after two years from the
date of its issuance the Company has not undertaken an initial
public offering of the Subsidiary's securities or has determined
to either search for a buyer of the business assets of the
Subsidiary or, alternatively, to dissolve the Subsidiary and
wind-up its affairs.
Present Operations
Concorde engages in the business of acquiring small growing
companies in diverse industries, providing value added management
services to those companies, and assisting with capital
formation. These companies will become wholly owned, or majority
owned,subsidiaries of Concorde.
Concorde's objective is to better meet the needs of growing
companies that may have had difficulty obtaining capital from
traditional sources such as banks, large asset based lenders, and
the public securities markets. Also, Concorde believes that its
opportunity is enhanced because of the consolidation in the
commercial banking industry and the emphasis in investment
banking toward increasingly larger financings. The resulting
diminishing of available capital has affected the flow to smaller
companies, where the need for capital is the most critical.
Concorde's approach is to develop "partnerships" with companies
having exceptional management in order to improve the long term
value of a business. The participation of management through
equity based compensation and stock ownership is a crucial
ingredient of Concorde's plan.
Operations of Subsidiary
The Registrant's wholly owned Subsidiary, L'Abbigliamento, Ltd.
(the "Subsidiary") is a wholesaler of high quality, updated
classic menswear imported from Italy. The Subsidiary was founded
in 1992, and is incorporated in the State of New York.
L'Abbigliamento, Ltd. sells tailored clothing, which includes
mens suits, sport jackets, and blazers, slacks, tuxedos,
overcoats, shirts and ties to retail stores.
The Subsidiary works very closely with its manufacturing
resources, as well as some of the leading fabric mills in Italy.
The Subsidiary's close coordination with its manufacturers and
suppliers enables it to maintain high quality standards and
provide timely deliveries to its customers.
L'Abbigliamento, Ltd. operates in a specialized segment of the
menswear business, selling to boutique retail stores. The
Subsidiary's success has been achieved as a result of the
management provided by its founder, and President, Paolo Vista,
the use of quality fabric, consistently good workmanship,
experienced production staff at its manufacturing resources, and
a thorough knowledge of the retail customers and the ultimate
consumer.
L'Abbigliamento is located in close proximity to Kennedy Airport,
where most of its merchandise is received from Italy. This
facility in Lawrence, New York is utilized for administrative and
merchandise distribution functions. The Subsidiary develops its
merchandise lines based on sales history, extensive knowledge of
the market, talking to customers, fashion trends, reviewing
fabrics, and keeping informed of competition's plans.
In planning for a season, samples are made for various styles.
These samples together with fabric swatches, are shown to
customers at trade shows. The orders which are obtained at the
shows are consolidated, and additional customers are called to
obtain their reaction to the styles being presented. Based on
analysis of orders and feedback from customers, the merchandise
lines are finalized. Fabric is ordered from the mills, and
production is scheduled with manufacturers. The quantities to be
produced for each size are based on sales history. The
merchandise line contains about 200 styles, excluding
accessories.
As a result of effective sourcing of piece goods and
manufacturing cost controls, the company's merchandise is offered
at very competitive price points, which provides a significant
advantage over other specialty wholesalers. The Subsidiary has
excellent relationships with its piece goods suppliers and
manufacturers, and feels that adequate merchandise will be
available to support its growth.
Most of the L'Abbigliamento's customers are located on the East
Coast of the United States and Puerto Rico. In addition, some
international business has been developed in Latin America and
Russia.
Regulation
All of Subsidiary's products are manufactured abroad, through
arrangements with independent foreign contractors. As a result,
the Subsidiary's operations may be adversely affected by
political instability resulting in the disruption of trade from
foreign countries in which the Subsidiary's contractors are
located, the imposition of additional regulations relating to
imports or duties, taxes and other charges on imports, any
significant fluctuation of the value of the dollar against
foreign currencies and restrictions on the transfer of funds. In
addition, the Company's import operations are subject to
constraints imposed by bilateral textile agreements between the
United States and certain foreign countries. These agreements
impose quotas on the amount and type of goods which can be
imported into the United States from these countries.
Competition
Registrant is, and is expected to remain, an insignificant entity
among a great many other companies who are engaged in mergers and
acquisitions of other business entities. There are many
established venture capital and financial concerns seeking to
attract merger or acquisition candidates, virtually all of which
have significantly greater financial and personnel resources and
technical expertise than Registrant.
The Registrant's subsidiary, L'Abbigliamento, Ltd., operates in
the apparel industry, which is highly competitive because of the
emphasis on fashion, the combination of large and small
producers, the flow of imported merchandise, and a large variety
of retail customers. The key elements of competition in the
apparel industry include style, quality, price, brand loyalty,
comfort, customer service and advertising. A large number of
companies compete in the Subsidiary's segment of the apparel
industry, many of which have significantly greater financial
marketing and other resources than the Subsidiary.
ITEM 2. PROPERTIES
Facilities
The Company utilizes the offices and business facilities of
Ameristar Group Incorporated ("Ameristar"), which serves as a
consultant to Concorde. Until October 31, 1997, the Company had
the use of these offices and business facilities rent free.
Since November 1, 1997, the Company has paid a monthly rental of
$3,743.00 for use of the office space and related business
facilities to Ameristar.
The Company's wholly owned Subsidiary, L'Abbigliamento, ltd.
leases a building consisting of 5,786 square feet from a company
whose owner is related to a shareholder of Concorde, at an annual
rent of $84,000.
Employees
The Company has no full time employees except for its President,
Mr. Robert Gordon. The officers and directors, all of whom are
engaged in other full time business activities, devote so much of
their time to the affairs of the Company as is required.
The Company's Subsidiary has seven full time employees, including
two outside salesmen who work on a commission basis.
ITEM 3. LEGAL PROCEEDINGS
The Company knows of no litigation pending, threatened or
contemplated, or unsatisfied judgments against it, or any
proceedings in which the Company is a party. The Company
also knows of no legal action pending or threatened or judgments
entered against any officers or directors of the Company in their
capacity as such.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The Units sold in the Company's original public offering in 1989
had been trading on a limited basis, with only a limited trading
market for the shares of common stock having ever been
established. The principal market on which the Company's
securities have in the past traded was the over-the-counter
market in the "pink sheets."
There had not been any trading market in the Company's securities
from July 19, 1989 through March 24, 1997. The stock resumed
trading on March 24, 1997 under the symbol "CSGG" on the OTC
Electronic Bulletin Board. The number of record shareholders on
December 31, 1997 for the Company's Common Stock was 232 and for
its Series B Convertible Preferred Stock was 55 shareholders.
There currently are 7 market makers for the Company's Common
Stock and 6 market makers for its Series B Convertible
Preferred Stock.
The following tables show for the periods indicated the range of
high and low bid quotes for the Common Stock and Series B
Convertible Preferred Shares obtained from the OTC Electronic
Bulletin Board and are between dealers, do not include retail
mark-ups, mark-downs, or other fees or commissions, and may not
necessarily represent actual transactions.
COMMON STOCK TRADING HISTORY (Since March 24, 1997)
High Low
Quarter ended March 31, 1997 $0.625 $0.375
Quarter ended June 30, 1997 $0.875 $0.8125
Quarter ended September 30, 1997 $2.00 $0.625
Quarter ended December 31, 1997 $1.9375 $1.3437
Quarter ended March 31, 1998 $1.5625 $0.625
SERIES B CONVERTIBLE PREFERRED SHARE TRADING HISTORY (Since
December 4, 1997)
High Low
Quarter ended December 31, 1997 $0.3125 $0.875
Quarter ended March 31, 1998 $4.75 $0.4375
On October 24, 1997, the Company completed a Private Placement
Offering of 450,000 non
dividend bearing, no par value, Series B Convertible Preferred
Shares. All of the
shares were sold by the Company and no Placement Agent was
involved in this Offering.
The shares were sold at a purchase price of $.3125 per share and
the Company realized
proceeds of $130,633 from the Offering, net of Offering expenses
in the amount of
$9,992. The shares were sold through a Private Placement
pursuant to the exemption
provided by Rule 504 of Regulation D under the Securities Act of
1933, as amended.
Each Preferred Share is convertible into one and one quarter
(1.25) shares of the
Company's Common Stock, no par value, at the election of the
Preferred Shareholder at
any time after thirteen months from the date of issuance thereof
and for a period of
four years thereafter.
In December, 1997, the Company sold 315,000 shares of Series B
Convertible Preferred
shares to certain parties who had performed services on behalf of
the Company,
including two companies which are principally owned by two
Directors of the Company.
The shares were sold by the Company in consideration for the
cancellation of payments
owed by the Company at the agreed upon rate of $.25 per share and
were sold through a
Private Placement pursuant to the exemption provided by Rule 504
of Regulation D under
the Securities Act of 1933, as amended. These shares were issued
in January, 1998,
subsequent to the period covered by this report. The sale of
these shares has been
reflected in the Company's financial statements for the year
ended December 31, 1997.
Also, subsequent to the period covered by this Report, the
Company commenced a Private
Placement Offering of 750,000 Series B Convertible Preferred
Stock Purchase Warrants.
All of the Warrants are being sold by the Company and no
Placement Agent is involved
in this Offering. The Warrants are being sold at a purchase price
of $1.00 per Warrant.
The Company will realize proceeds of $138,000 from the Offering,
net of offering
expenses in the amount of $12,000, if the minimum number of
150,000 Warrants are sold.
The Company will realize proceeds of $738,000 from the Offering,
net of offering
expenses in the amount of $12,000, if the maximum number of
750,000 Warrants are sold.
As of the date of this Report, the Company has received proceeds
totaling $168,500 net
of offering costs of $12,000 for the sale of 180,500 Warrants.
This total exceeds the
minimum offering of 150,000 Warrants. The Offering expires on
April 30, 1998, unless
extended for up to 60 business days by the Company. Each Warrant
entitles the holder
thereof to purchase one Series B Convertible Preferred Share at a
price of $3.00 per
share during the period commencing thirteen months after the date
of the issuance
thereof and continue thirty (30) months thereafter.
The Company has not paid any dividends and, there are no plans to
pay any cash
dividends in the foreseeable future. The declaration and payment
of dividends in the
future, of which there can be no assurance, is determined by the
Board of Directors
based upon conditions then existing. There are no restrictions
on the Company's
ability to pay dividends.
ITEM 6. SELECTED FINANCIAL INFORMATION
Summary Balance Sheet Data: YEAR ENDED DECEMBER 31,
1997 1996
Total Assets $3,440,634 $ -0-
Total Current Assets 3,341,282 -0-
Total Liabilities 2,276,451 105,543
Retained Earnings (Deficit) (111,164) (244,527)
Stockholders' Equity. $1,164,183 $(105,543)
Summary Earnings Data: YEAR ENDED DECEMBER 31,
1997 1996
Revenues $1,827,502 $ -0-
Selling, general &
administrative expense 495,162 149,543
Income (loss) from operations (87,361) (149,543)
Net Income (Loss) (100,361) (149,543)
Earnings (Loss) per
Share $ (.05) $ n/a
The foregoing is selected financial information only, and is
qualified by the financial
statements and the notes thereto, in their entirety, which are
set forth elsewhere in
this Report. The selected financial information for 1997
includes the results of the
Company's subsidiary, L'Abbigliamento, Ltd. from July 1, 1997,
the effective date of
the acquisition.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
Until fiscal 1992, Registrant had generated only interest income
since its inception.
Commencing in fiscal 1992, Registrant's available cash was
reduced to a level where it
ceased to generate any interest revenues at all. Following the
write-off of the
judgement obtained against Nite-Lite, Limited, a Delaware
corporation, Registrant had
no realistic expectation of any future revenues, including
interest income since its
cash position has been depleted to a balance of $-0- as of March,
31, 1997.
In April, 1996, Registrant undertook a private placement of its
securities pursuant to
the provisions of Rule 504 under Regulation D under the
Securities Act of 1933, as
amended, whereby it issued 9,000,000 shares of its Common Stock
in exchange for the
satisfaction of $45,000 in debts owed by the Company. Also in
April 1996, the Company
effected a 1-for-10 reverse split of its common stock as the
result of which the
Company had, following the aforesaid private offering, 1,200,000
shares issued and
outstanding. This reverse split was effected in anticipation of
management's renewed
efforts to find a suitable business opportunity for the Company.
The results of operations for the Company's subsidiary have been
included in the
consolidated results of the Company from July 1, 1997, the
effective date of the
acquisition. These results do not include the subsidiary's
results of operations for
the comparable periods in 1996.
Sales were $1,827,502 for the twelve month period ended December
31, 1997, all of which
resulted from the Company's acquisition of its operating
subsidiary, L'Abbigliamento,
Ltd., which was completed effective July 1, 1997. The Company
did not have any revenue
in the comparable period for 1996. After cost of revenues of
$1,419,701 gross profit
realized was $407,801 for the period ended December 31, 1997.
All of the gross profit
resulted from operations of the Company's subsidiary, and the
Company did not have any
gross profit in the comparable period for 1996. Gross profit for
the year ended
December 31, 1997 was 22.3 per cent of sales.
Consolidated operating expenses for 1997 were $495,162, which
includes the Subsidiary's
total of $306,979 and the parent Company's total of $188,183.
The parent Company's
operating expenses increased $38,640 from 1996 primarily due to
increased consulting
fees. The Subsidiary's operating expenses were 16.8 per cent of
sales for the period
reported.
The net loss for the twelve month period ended December 31, 1997
was $87,361 compared
to a net loss of $149,543 for the comparable period ended
December 31, 1996, a decrease
of $62,182. All of the decrease in net loss during this period
resulted from
operations of the Company's subsidiary.
The total cash and cash equivalents at December 31, 1997 totalled
$133,606. Of that
amount the Subsidiary's total was $62,459, and the parent
company's total was $71,147.
Accounts receivable at December 31, 1997 totalled $1,374,546, all
of which is owed to
the Subsidiary. Of that total, 25 per cent is current, 25 per
cent is 30-60 days old,
and 50 per cent is over 60 days old. This pattern is
characteristic of the subsidiary's
industry and customer base.
Inventory at December 31, 1997 totalled $1,819,695, which was all
maintained by the
Subsidiary. Of that total, $761,552 represented raw material
(fabric) for production.
Accounts payable at December 31, 1997 totalled $1,487,426, all of
which is current.
Of that amount, the Subsidiary's accounts payable total was
$1,332,674, and the parent
company's total was $154,752. The Subsidiary's accounts payable
total consists mostly
of raw material purchases and cost of finished goods, consistent
with the Subsidiary's
Cost of Goods Sold and Operating Expense percentages of sales.
The parent Company's
accounts payable represents its normal business overhead expenses
and consulting
services.
The amount of $361,098 due to a factor and the long term bank
loans in the amount of
$252,414 represent borrowings by the Subsidiary, as a result of
the need to carry
customer accounts receivable and to purchase fabric inventory in
advance of the selling
season.
The Company is continuing to look for suitable acquisition
candidates. As of the date
of this Report, no additional acquisition candidates have been
found, and there is no
assurance that any additional candidates will be found.
Liquidity and Capital Resources
At the end of fiscal 1997, the Company and its subsidiary had
cash totalling $133,606,
which is not adequate for working capital requirements, There is
no assurance that the
Company will be able to raise the amount of capital needed to
meet its working capital
needs.
As of the date of this Report, in a Private Placement Offering,
the Company has sold
180,500 Series B Convertible Preferred Stock Purchase Warrants
and received proceeds
of $168,500, net of offering costs of $12,000. See Part II, Item
5.
General Risk Factors Affecting the Company and its Subsidiary
Various factors could cause the actual results of the Company to
differ materially from
those indicated by forward-looking statements made from time to
time in news releases,
reports, proxy statements, registration statements and other
written communications
(including the preceding sections of this document), as well as
oral statements made
from time to time by representatives of the Company. Except for
historical
information, matters discussed in such oral and written
communications are forward-looking statements that involve risks
and uncertainties, including, but not limited to,
economic and business conditions in the United States and abroad;
the level of demand
for apparel products and success of planned marketing programs;
the intensity of
competition and the pricing pressures that may result; changes in
labor and import and
export regulations; the ability of the Subsidiary to timely and
effectively manage
inventory levels and sourcing; the ability to finance capital
expenditures; and
currency fluctuation.
Change in Control
By formal Agreement dated as of September 23, 1996, the Company
agreed to acquire 100%
of the capital stock of Concorde Management, Ltd. (formerly
Concorde Strategies Group,
Ltd. "CML"), a Delaware corporation formed in February 1996.
This acquisition was
concluded as of July 1, 1997. Under the terms of this Agreement,
the Company acquired
CML and its wholly owned subsidiary, L'Abbigliamento, Ltd. See
Part I, Item 1 and Note
8 to Consolidated Financial Statements contained in this Report.
Reference is also
made to Form 8-K Report and Exhibit filed on November 15, 1996
and Form 8-K Report
filed on July 2, 1997.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Financial Statements:
For the Year Ended December 31, 1997:
Reference
Report of Janet Loss, C.P.A., P.C.,
Independent Certified Public Accountant F-11
Report of Jay Fox, C.P.A. F-12
Independent Certified Public Accountant
Consolidated Financial Statements:
Balance Sheet F-13, 14
Statement of Operations F-15
Statement of Cash Flows F-16
Statement of Stockholder's
Equity (Deficit) F-17, 18
Notes to Financial Statements F-19, 20,
21, 22, 23
<PAGE>
Janet Loss, C.P.A., P.C.
Certified Public Accountant
3525 S. Tamarac Drive, Suite 125
Denver, Colorado 80237
Board of Directors
Concorde Strategies Group, Inc. and Subsidiary
444 Madison Avenue, Suite 1710
New York, New York 10022
I have audited the accompanying consolidated balance sheet of
Concorde Strategies
Group, Inc. and subsidiary as of December 31, 1997 and the
related consolidated
statements of income, changes in stockholders' equity and cash
flows for the year ended
December 31, 1997. I have also audited the balance sheet of
Concorde Strategies Group,
Inc. as of December 31, 1996, and the related statements of
income, changes in
stockholders' equity and cash flows for the year ended December
31, 1996. The above-mentioned financial statements are the
responsibility of the Company's management. My
responsibility is to express an opinion on the consolidated
financial statements at
December 31, 1997 and the financial statements at December 31,
1996 based on my audits.
I did not audit the subsidiary's statement of financial condition
as of December 31,
1997 nor the subsidiary's related statement of income, changes in
stockholders' equity
and cash flows for the year ended December 31, 1997. The
subsidiary's statements
reflect total assets of $3,368,406.00 as of December 31, 1997 and
total revenues of
$1,827,502.00 for the six month period ended December 31, 1997.
The subsidiary's
financial statements are included in the consolidated financial
statements of Concorde
Strategies Group, Inc. The subsidiary's financial statements
were audited by other
auditors whose report has been furnished to me, and my opinion in
so far as it relates
to the comments of the subsidiary is based solely on the report
of such other auditors.
I conducted my audits in accordance with generally accepted
accounting standards. These
standards require that I 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. I believe that my audit
provides a reasonable basis
for my opinion.
In my opinion, based upon my audit and the report of other
auditors, the consolidated
financial statements at December 31, 1997 and financial
statements at December 31, 1996
referred to above present fairly, in all material respects, the
financial position of
Concorde Strategies Group, Inc. and subsidiary as of December
31, 1997 and the
financial position of Concorde Strategies Group, Inc. as of
December 31, 1996, and the
results of their operations and their cash flows for the years
ended December 31, 1997
and 1996 in conformity with generally accepted accounting
principles.
/s/Janet Loss
Janet Loss, C.P.A., P.C.
May 14, 1998 <PAGE>
JAY FOX, C.P.A.
4315 AUSTIN BLVD.
ISLAND PARK, NY 11558
April 7, 1998
To the Board of Directors and Shareholders
L'Abbigliamento, Ltd. and Vista International Ltd.:
We have audited the accompanying consolidated balance sheet
of L'Abbigliamento, Ltd.
and Vista International ltd. as of December 31, 1997, and the
related consolidated
statements of income and retained earnings and cash flows for the
six months then
ended. These financial statements are the responsibility of the
Company's management.
Our responsibility is to express an opinion on the 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 audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all
material aspects, the financial position of L'Abbigliamento, Ltd.
and Vista
International Ltd. as of December 31, 1997, and the results of
its operations and its
cash flows for the six months then ended in conformity with
generally accepted
accounting principles.
/s/ Jay Fox
Jay Fox, C.P.A.
<PAGE>
CONCORDE STRATEGIES GROUP, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET AND BALANCE SHEET
DECEMBER 31, 1997 AND 1996
CONSOLIDATED
BALANCE SHEET BALANCE
SHEET
1997 1996
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 133,606 $
- -
Accounts receivable 1,374,546 -
Inventory (as submitted) 1,819,695 -
Prepaid Expenses 13,435
- -
TOTAL CURRENT ASSETS: $3,341,282 $
- -
Fixed assets, net of accumulated
depreciation of $20,907 $ - $
- -
Leasehold improvements net of
accumulated amortization of $999 58,852 -
Security Deposits 40,500
- -
TOTAL ASSETS $3,440,634 $ 0
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
1997 1996
CURRENT LIABILITIES:
Accounts payable $1,487,426 $
26,668
Due to Factor 361,098 -
Bank and other loans payable
(current) 73,130 -
Corporate income taxes payable 13,000 -
Due to Ameristar
Capital Corporation $ 89,383 $
78,875
TOTAL CURRENT LIABILITIES $2,024,037 $
105,543
LONG TERM LIABILITIES:
Bank and other loans $ 252,414 $
- -
TOTAL LIABILITIES: $2,276,451 $ 105,543
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, no par value,
100,000,000 shares authorized.
Series A Convertible, redeemable,
1,000 shares issued and out-
standing.
Series B Convertible,non-dividend
bearing, 450,000 shares issued
and outstanding, sold at a price
of $.3125 per share for gross
proceeds of $140,625 less
offering costs of $9,992 $ 130,633 $ -
Common stock, no par value,
500,000,000 shares authorized,
3,300,000 and 1,200,000 shares
issued and outstanding as of
December 31, 1997 and 1996 $ 166,839 $ 136,839
Additional paid-in-capital 977,875 1,875
Retained earnings(Deficit) (111,164) (244,257)
TOTAL STOCKHOLDERS' EQUITY 1,164,183 (105,543)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $3,440 634 $
0
The accompanying notes are an integral part of these financial
statements.
<PAGE>
CONCORDE STRATEGIES GROUP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS AND
STATEMENT OF OPERATIONS
For the Years Ended December 31, 1997 and 1996
December 31, 1997 December 31, 1996
REVENUES
Sales $ 1,827,502 $
0
COST OF GOODS SOLD 1,419,701 0
GROSS PROFIT: 407,801 $
0
OPERATING EXPENSES:
Transfer and filing fees 884 $ 3,836
Insurance 23,067
-
Payroll and payroll taxes 117,941
- -
Rent 42,486
- -
Utilities and telephone 13,598
424
Commissions 23,626
- -
Auto and travel 9,940
443
Entertainment 4,886
-
Bank charges and interest 31,935
- -
Advertising 22,003
-
Office Expenses 10,954
415
Repairs and maintenance 4,177
-
Consulting 157,900
118,000
Professional Fees 25,462
26,425
Depreciation and amortization 4,288 -
Printing expenses 2,015
-
TOTAL OPERATING EXPENSES 495,162 149,543
NET (LOSS) BEFORE PROVISION
FOR INCOME TAXES (87,361)
(149,543)
ESTIMATED PROVISION FOR
INCOME TAXES 13,000
- -
NET (LOSS) $ (100,361) $
(149,543)
NET (LOSS PER SHARE) $ (.05) $
(.15)
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 1,825,000 *975,000
* shares reflect a 1 for 10 reverse split
The accompanying notes are an integral part of these financial
statements.
CONCORDE STRATEGIES GROUP, INC. AND SUBSIDIARY
CONSOLIDATED CASH FLOW STATEMENT AND CASH FLOW STATEMENT
For the Years Ended December 31, 1997 and 1996
Consolidated Cash Cash
Flow Statement
Flow Statement 1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(100,361) $ (149,543)
Adjustments to reconcile
net loss to net cash flow
from operating activities:
Depreciation and amortization 4,288 -
(Increase)in accounts receivable (197,931) -
(Increase)in inventory (393,915) -
(Increase)in prepaid expenses (1,081) -
Increase in payables 646,066
104,543
(Decrease)in corporate income
taxes payable $ (3,773) $
- -
Cash Used by Operating Activities $ (46,707) $ 45,000
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in fixed assets (3,082) -
Increase in leasehold improvements (11,217) -
Net Cash used in investing
activities (14,299)
- -
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance
of preferred stock 130,633
- -
Proceeds from issuance of stock 30,000
45,000
Paydowns of amounts due to factor (13,902)
- -
Net Cash Provided by
Financing Activities $ 146,731 $
45,000
Net Increase in Cash $ 85,725 $ 0
CASH, BEGINNING OF THE PERIOD $ 47,881 $ 0
CASH, END OF THE PERIOD $ 133,606 $ 0
Supplemental cash flow information
Cash flow data:
Interest paid $26,270
Income taxes paid $ -
The accompanying notes are an integral part of these financial
statements.
CONCORDE STRATEGIES GROUP, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
For the Year Ended December 31, 1996 and
Consolidated Statement of Stockholders' Equity
for the Year Ended December 31, 1997
Preferred
Stock Non-
Deficit
Dividend
Accumulated Total
Bearing Common Stock
Additional during the Stockholders'
Series B Number of Common Stock
Paid-in Development Equity
Convertible Shares Amount
Capital Stage (Deficit)
Balance,
January 1, 1996 3,000,000 $91,839 $1,875
$(94,714) $(1,000)
April 1996,
9,000,000 shares 9,000,000 $45,000 --
-- $45,000
issued at no par
value at an
effective price
of $0.00
April 1996,
1-for-10 reverse
split (10,800,000) -- --
-- --
Net (loss) for
the Year Ended
December 31, 1996 -- -- --
(149,543) (149,543)
Balance,
December 31, 1996 1,200,000 136,839 1,875
(244,257) (105,543)
300,000 shares
issued for services,
June 13, 1997 300,000 30,000 --
-- 30,000
Shares issued for
acquisition
effective July 1,
1997 1,800,000 -- 976,000
233,454 1,209,454
450,000 shares
of Preferred
Stock, Non-
Dividend 130,633 -- -- --
-- 130,633
Bearing Series
B Convertible
Net (loss) for
the year ended
December 31, 1997 -- -- -- --
(100,361) (100,361)
Balance, December
31, 1997 $130,633 3,300,000 $166,839
$977,875 $(111,164) $1,164,183
The accompanying notes are an integral part of these financial
statements.
<PAGE>
CONCORDE STRATEGIES GROUP, INC. AND SUBSIDIARY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1997 AND
FINANCIAL STATEMENTS FOR YEAR ENDED DECEMBER 31, 1996
Note 1 - ORGANIZATION AND HISTORY
The Company is a Colorado corporation and the Company had been in
the development stage
since its formation on February 12, 1988. The Company was formed
to seek potential
business acquisitions and its activities since inception are
primarily related to its
initial public offering and merger activities.
Upon the completion of the acquisition of Concorde Management,
Ltd. and its wholly
owned subsidiary, L'Abbigliamento, Ltd., the Company has ceased
from being a
development stage company. This acquisition was effective July
1, 1997.
L'Abbigliamento, Ltd. is a New York State corporation which was
incorporated in New
York State in March of 1992. L'Abbigliamento, Ltd. commenced
operations in August of
1992 as an importer of fine men's clothing. In October of 1995
Vista International
Ltd., incorporated in the Cayman Islands, was organized to
acquire raw material and to
sell finished goods to areas outside the United States.
Effective July 1, 1997
L'Abbigliamento, Ltd. and Vista International Ltd. were
acquired through an exchange
of stock by Concorde Strategies Group, Inc.
Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, cash on deposit
and highly liquid
investments with maturities generally of three months or less to
L'Abbigliamento, Ltd.
At December 31, 1997, there were no cash equivalents.
Organization Costs
Costs incurred in organizing the Company are being amortized over
a sixty-month period.
Deferred Offering Costs
Costs associated with the Company's private offerings have been
charged to the proceeds
of the offering. If the offerings are unsuccessful, the costs
will be charged to
operations.
Sales and expenses
Sales and expenses are recorded using the accrual basis of
accounting. Inventory
shipped on consignment is recorded as a sale when it is sold by
the customer.
Inventory
Inventory is stated at the lower of first-in first-out; cost or
market and is based
upon physical counts taken by management at December 31, 1997.
Fixed assets and accumulated depreciation
Fixed assets consist of a computer system and are stated at cost
less accumulated
depreciation which is provided for by charges to operations over
the estimated useful
lives of the assets. The assets are depreciated over five years
utilizing Internal
Revenue Code Section 179 expense deduction of $17,500 annually
with the remaining
basis, when applicable, being depreciated using an accelerated
cost revenue method.
Leasehold improvements and accumulated amortization
Leasehold improvements are stated at cost less accumulated
amortization which is
provided for by charges to operations over 31.5 years using a
straight line method.
Use of estimates
The preparation of financial statements in conformity with
generally accepted
accounting principles requires management to make estimates and
assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and
liabilities at the date of the financial statements and revenues
and expenses during
the reporting period. Actual results could differ from those
estimates.
Note 3 - AGING OF ACCOUNTS RECEIVABLE AND PAYABLE
The percentage aging of trade accounts receivable and accounts
payable at December 31,
1997 is as follows:
Accounts Receivable Accounts Payable
Current 25% 100%
30-60 days 25%
over 60 days 50%
100%
Note 4 - INVENTORY
Inventory at December 31, 1997 was as follows:
Raw material (fabric) $ 761,552
Finished goods 679,850
Consignment 378,293
Total $1,819,695
Effective October 1, 1997, L'Abbigliamento, Ltd. entered into
consignment sales
arrangement with two mass merchandisers of men's clothing.
During the first quarter
of 1998, L'Abbigliamento, Ltd. added two additional consignment
customers. Management
believes that this newly instituted marketing strategy will
improve sales, profit
margins and collection cycles.
Note 5 - FACTORING OF ACCOUNTS RECEIVABLE
The subsidiary has entered into a non-recourse agreement with an
independent factor.
The balances advanced by the factor bear a one-time fee of 5% of
the invoice and is
secured by post dated checks issued by the customer.
Note 6 - BANK LOAN
At December 31, 1997, the subsidiary had outstanding debt in the
amount of $325,544
($73,130 - current) with interest related thereto at 2% - 7% over
the prime rate.
These obligations mature over the next five years with a
remaining balloon payment of
$40,000 due at that time. The bank loan is secured by inventory
and accounts
receivable.
Note 7 - CAPITALIZATION
In April 1996, the Company undertook a private placement of its
securities pursuant to
the provisions of Rule 504 under Regulation D under the
Securities Act of 1933, as
amended, whereby it issued 9,000,000 shares of its Common Stock
in exchange for the
satisfaction of $45,000 in debts owed by the Registrant. Also in
April 1996, the
Company effected a 1-for-10 reverse split of its common stock as
the result of which
the Company had, following the aforesaid private offering,
1,200,000 shares issued and
outstanding. This reverse split was effected in anticipation of
management's renewed
efforts to find a suitable business opportunity for the Company.
In June, 1997 the Company issued 300,000 shares of common stock
to certain parties who
had performed services on behalf of the Company. The shares were
issued in
consideration for the cancellation of payments owed by the
Company at the agreed upon
rate of $.10 per share and were sold through a Private Placement
pursuant to the
exemption provided by Rule 504 of Regulation D under the
Securities Act of 1933, as
amended.
On October 24, 1997, the Company completed a Private Placement
Offering of 450,000 non
dividend bearing, no par value, Series B Convertible Preferred
Shares. All of the
shares were sold by the Company and no Placement Agent was
involved in this Offering.
The shares were sold at a purchase price of $.3125 per share and
the Company realized
proceeds of $130,633 from the Offering, net of offering expenses
in the amount of
$9,992. The shares were sold through a Private Placement
pursuant to the exemption
provided by Rule 504 of Regulation D under the Securities Act of
1933, as amended.
Each Preferred Share is convertible into one and one quarter
(1.25) shares of the
Company's Common Stock, no par value, at the election of the
Preferred Shareholder at
any time after thirteen months from the date of issuance thereof
and for a period of
four years thereafter.
In December, 1997, the Company sold 315,000 shares of Series B
Convertible Preferred
shares to certain parties who had performed services on behalf of
the Company,
including two companies which are principally owned by two
Directors of the Company.
The shares were sold by the Company in consideration for the
cancellation of payments
owed by the Company at the agreed upon rate of $.25 per share and
were sold through a
Private Placement pursuant to the exemption provided by Rule 504
of Regulation D under
the Securities Act of 1933, as amended. These shares were issued
in January, 1998,
subsequent to the period covered by this report.
Note 8 - MERGER ACTIVITIES
Pursuant to the Agreement and Plan of Reorganization entered into
with Concorde
Management, Ltd. (formerly, Concorde Strategies Group, Ltd.) on
September 23, 1996, and
in anticipation of receiving audited financial statements the
Company has completed the
acquisition of Concorde Management, Ltd. and its wholly owned
subsidiary,
L'Abbigliamento, Ltd. The Agreement and Plan of Reorganization
was filed as an Exhibit
to Form 8-K dated November 15, 1996.
The acquisition, effective as of July 1, 1997, was completed
through a tax-free
exchange of securities by the Company's issuance of 1,800,000
shares of its common
stock in exchange for all of the issued and outstanding common
shares of Concorde
Management, Ltd.
Note 9 - PROVISION FOR TAXES ON INCOME
The difference between the recorded income tax provision and the
expected tax provision
based on the statutory federal and state income tax rated is as
follows:
Computed federal and state tax at
statutory rates $29,829
Tax effect of permanent book-tax
differences (entertainment) 891
Benefit from combining operations
with the Company's parent (17,720)
$13,000
Note 10 - LEASES AND OTHER COMMITMENTS
The parent company leases its premises from Ameristar, an
affiliated company, for the
following annual rent expenses.
(eleven months) November 1, 1997 thru September 30, 1998
$41,173
October 1, 1998 thru September 30, 1999
46,152
October 1, 1999 thru September 30, 2000
47,424
October 1, 2000 thru September 30, 2001
48,732
Total Rent Commitment
$183,481
The subsidiary leases it premises from a company whose owner is
related to a
shareholder of Concorde Strategies Group, Inc. at an annual rent
of $84,000, for each
of the next five years with annual adjustment for real estate
taxes.
The subsidiary has an employment agreement with its key executive
officer for five
years at base compensation, of $200,000 per year. The contract
also provides for
additional incentives based upon performance standards and annual
adjustments to the
base for changes in the consumer price index.
Note 11 - RELATED PARTY TRANSACTIONS
The Company has received advances of monies for its operating
expenses from an
affiliated company, Ameristar Group Incorporated. That company
("Ameristar") also
serves as a consultant to Concorde. Concorde Strategies Group,
Inc. is leasing office
space from Ameristar on a monthly rental, commencing on November
1, 1997 for a term of
three years and eleven (11) months. (see note 10)
The Company has incurred consulting fees of $96,000 to its
President, $45,000 to
"Ameristar" (an affiliate corporation), and $30,000 to a 5%
stockholder of the Company,
since the beginning of 1996.
The Company has issued 200,000 shares of common stock to two
related privately owned
companies in consideration of $.10 per share for consulting
services performed on
behalf of the Company. (See Note 7. - Capitalization)
As discussed in Note 10, the subsidiary leases it facilities from
a company whose owner
is related to a shareholder of Concorde Strategies Group, Inc.
Rent paid under this
lease is believed by management to be at arm's length rates.
Additionally,
L'Abbigliamento, Ltd. received advances from its parent, Concorde
Strategies Group,
Inc. which bear interest at market rate.
Subsequent to the period covered by this report, On January 7,
1998, the Company
issued 222,000 shares of Series B Convertible Preferred Stock to
two related privately
owned companies in consideration of $.25 per share for consulting
services performed
on behalf of the Company. (see Note 7 - Capitalization).
Note 12 - CONSOLIDATION OF FINANCIAL INFORMATION
The consolidated financial statements of the Company for the year
ended December 31,
1997 include the results of the acquisition of Concorde
Management, Ltd. and its
wholly owned subsidiary, L'Abbigliamento, Ltd. only from the
date of acquisition on
July 1, 1997. The financial statements for the year ended
December 31, 1996 include
the results of operations for the parent company only.
All material intercompany accounts and transactions have been
eliminated.
Note 13 - SUBSEQUENT EVENTS
On January 7, 1998, the Company issued 315,000 shares of Series B
Convertible Preferred
shares to certain parties who had performed services on behalf of
the Company,
including two companies which are principally owned by two
Directors of the Company.
The shares were issued by the Company in consideration for the
cancellation of payments
owed by the Company at the agreed upon rate of $.25 per share and
were sold through a
Private Placement pursuant to the exemption provided by Rule 504
of Regulation D under
the Securities Act of 1933, as amended. (see Note 7 to financial
statements).
In 1998, the Company commenced a private placement of 750,000
Series B Convertible
Preferred Stock Purchase Warrants at a purchase price of $1.00
per Warrant. The
Company will realize proceeds of $138,000 from the Offering net
of offering expenses
of $12,000, if the minimum number of 150,000 Warrants are sold.
The Company will
realize proceeds of $738,000 from the Offering, net of offering
expenses in the amount
of $12,000, if the maximum number of Warrants are sold. Each
warrant entitles the
holder thereof to purchase one Series B Convertible Preferred
Share at a price of $3.00
per share during the period commencing thirteen months after the
date of the issuance
thereof and continuing thirty (30) months thereafter. The
warrants are redeemable by
the Company at any time after thirteen months after their
issuance and prior to their
expiration at a price of $0.05 per warrant, upon 30 days prior
written notice, provided
that the closing sale price of the shares as reported on the NASD
Electronic Bulletin
Board shall have been at least $4.80 (160% of the exercise price
of the warrants) on
each of the 20 consecutive trading days ending on the tenth day
prior to the day on
which the notice of redemption is given. As of March 31, 1998,
the company has sold
150,000 warrants.
<PAGE>
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The executive officers and directors of the Company are as
follows:
NAME Age POSITION(S) HELD
Robert Gordon 62 President, Director
Gera Laun 33 Secretary
Joseph J. Messina 43 Director
Martin I. Saposnick 51 Director
David A. Vigor 60 Director
William C. Hayde 38 Director
Profiles of the directors and officers of the Company are
set forth below. All
directors hold office until the next annual shareholders meeting
or until their death,
resignation, retirement, removal, disqualification or until their
successors have been
elected and qualified. Vacancies in the Board may be filled by
majority vote of the
remaining directors. Officers of the Company serve at the will
of the Board of
Directors. There is no Executive Committee or other committee of
the Board of Direc-
tors. Election to the Board of Directors is for a period of one
year or until the next
shareholder's meeting and elections are ordinarily held at the
Company's Annual Meeting
of Shareholders. There are no family relationships between
officers and directors.
Profiles of Officers and Directors
ROBERT GORDON is President. Mr. Gordon was previously
Executive Vice President of
Contex, Inc., an investment banking and consulting firm in
Naples, Florida. Prior to
Contex, Mr. Gordon was Managing Director of an apparel company,
President and Chief
Operating officer of a public company that manufactures precision
parts and conducted
research and development, a management consultant, Executive Vice
President of a
financial services company, and Director of MIS for Kinney Shoe
Corporation. Mr.
Gordon has a B.A. degree in Economics from Union College.
GERA LAUN is Secretary. Ms. Laun is also Secretary and
Treasurer of Ameristar
Capital Corporation, an equipment leasing company. Previously,
Ms. Laun was Manager,
Processing Department of Vendor Funding Co., Inc. an equipment
leasing and asset based
lending company. Also, Ms. Laun was Manager, Mail Order
Catalog/Retail for La Shack,
Inc.
JOSEPH J. MESSINA is a Director. He is also Chairman and
CEO of both Ameristar
Capital Corporation, a lease financing and asset based lender and
Ameristar Group
Incorporated, an investment banking and financial consulting firm
specializing in
"small cap" companies. Mr. Messina was previously President and
Chief Operating
Officer of Vendor Funding Co., Inc., a subsidiary of the Bank of
Ireland First
Holdings. Vendor Funding, a national middle market lessor and
asset based lender, was
co-founded by Mr. Messina and subsequently sold to First NH Banks
of Manchester, New
Hampshire. Mr. Messina is a Director of Credit America Venture
Capital, an entity
formed to acquire the manufacturing and distribution network of
Mako Marine
International, Inc. He is also a Director of Mako Marine
International, Inc., a
publicly held corporation, and past President of the Eastern
Association of Equipment
Lessors.
MARTIN I. SAPOSNICK is a Director, and is also President of
Ameristar Group
Incorporated, an investment banking and financial consulting firm
specializing in
"small cap" companies. Previously Mr. Saposnick was President of
Remsen Group, an
independent investment banking and financial consulting services
company. Prior to
Remsen Group, Mr. Saposnick was Chairman of the Board and
President of Marsan
Securities Co., Inc., a financial services firm, which was a
wholly owned subsidiary
of Marsan Capital Corporation, a publicly held company. Mr.
Saposnick was also
Chairman of the Board and President of Marsan Capital
Corporation. Previously, Mr.
Saposnick was Vice President of Chestman Securities, Co., Inc.
and had been Assistant
Manager of Specialist Surveillance Division of the New York Stock
Exchange. Mr.
Saposnick is a graduate of Hunter College and completed graduate
studies in Finance and
Investments at Baruch College.
DAVID A. VIGOR is a Director and is also Executive Vice
President, Chief Financial
Officer and a Director of Phytomed, Inc. an early stage
biopharmaceutical company.
Previously, Mr. Vigor was Vice President, Finance and Chief
Financial Officer of
Ohmeda, an international manufacturer of pharmaceuticals and
medical devices, which is
a Division of BOC Group. In other executive positions with the
BOC Group, Mr. Vigor
was Vice President, Finance and Information Systems of Gases
Western Hemisphere and
Vice President, Finance of Ohmeda (A Division of BOC Health
Care). Mr. Vigor was also
Vice President, Finance for Millipore Corporation, a "Fortune
1000" manufacturer of
membrane filters and liquid chromatographs and Vice President,
Corporate Information
Resources for the Foxboro Company, and Finance Director for
foreign subsidiaries of
Westinghouse Electric Corporation. Mr. Vigor was an Audit
Supervisor for Barton, Mahew
& Co. (Ernst & Young). His education includes the Institute of
Chartered Accounts in
England and Wales and the Executive MBA program at Suffolk
University in Boston.
WILLIAM C. HAYDE is a Director. Mr. Hayde is also an
investment banker and co-owner
of Brockington Securities, a broker-dealer specializing in
wholesale and institutional
trading, mergers and acquisitions, and equity and debt
financings. Mr. Hayde is also
President of B.R. Equities, which owns and operates an electronic
trading room, as well
as Chairman of the Board of The Paris Group, Ltd. a venture
capital and consulting
company. Mr. Hayde, who has been active in the brokerage
business since 1983, was
previously Director of Corporate Finance for Aegis Capital. He
has a Bachelor's degree
in Psychology from Stonybrook University.
ITEM 11. EXECUTIVE COMPENSATION
Robert Gordon, President and a Director of the Company,
currently receives $1,000
per week. Since 1996, payments were advanced by Ameristar, on
behalf of the Company.
The total advanced as of December 31, 1997 is $41,000. During
1997, the payment
obligation was assumed by the Company. As of December 31, 1997,
the Company has an
accrued obligation for payments to Mr. Gordon of $48,000.
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth at the date of this
Prospectus the stock ownership
of each person known by the Company to be a beneficial owner of
five (5%) per cent or
more of the Company's Common Stock and by all officers and
directors, individually and
as a group:
Number Percentage
of Shares of
Owned(1) Class(1)
Name ______________ ___________
Robert Gordon* 110,000 3.33%
Gera Laun* 3,000 0.09%
Dunhill Limited*(2) 100,000 3.03%
Remsen Group, Ltd.*(3) 228,500 6.92%
Wilmont Holdings Corp.*(4) 228,500 6.92%
David A. Vigor* 25,000 0.75%
FNB Nominee FBO*(5) 25,000 0.75%
David Vigor IRA
Ameristar Group Incorporated(6)* 675,000 20.45%
Paolo Vista(7) 125,000 3.78%
Officers and Directors as a 1,395,000 42.27%
group (5 persons)
*Officer and/or Director
(1) Assumes a total number of shares outstanding of 3,300,000
shares
(2) Dunhill Limited is a privately held corporation principally
owned and controlled
by Joseph J. Messina and Martin I. Saposnick, directors of
the Company.
(3) Remsen Group, Ltd. is a privately held corporation
principally owned and
controlled by Mr. Martin I. Saposnick, a director of the
Company.
(4) Wilmont Holdings Corp. is a privately held corporation
principally owned and
controlled by Mr. Joseph J. Messina, a director of the
Company.
(5) FNB Nominee is trustee for IRA account of Mr. David A.
Vigor, a director of the
Company.
(6) Ameristar Group Incorporated is a privately held corporation
principally owned
and controlled by Joseph J. Messina and Martin I. Saposnick
, directors of the
Company.
(7) Paolo Vista is President of L'Abbigliamento, Ltd., the
Company's wholly owned
subsidiary.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
Financial Statements included in this Report:
Auditors Report of Janet Loss, C.P.A., P.C. dated May 14,
1998 together with;
Auditors Report of Jay Fox, C.P.A. dated April 7, 1998
Consolidated Balance Sheet as of December 31, 1997 and 1996;
Consolidated Statement of Income and Retained Earnings for
the years ended December
31, 1997 and 1996;
Consolidated Statement of Stockholders' Equity for the year
ended December 31, 1997;
Consolidated Statement of Cash Flows for the years ended
December 31, 1997 and 1996;
Notes to Consolidated Financial Statements.
(c) Form 8-K filings:
July 2, 1997 re: completion of Agreement and Plan of
Reorganization with Concorde
Management, Ltd.
January 13, 1998 re: increase in the number of directors,
and election of Mr.
William C. Hayde to serve as a
Director.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the
undersigned, thereunto duly authorized.
CONCORDE STRATEGIES GROUP, INC.
Dated: May 15, 1998 By: /s/ Robert Gordon
Robert
Gordon
President & Principal
Executive Officer
and Principal Financial
and Accounting
Officer
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has
been signed below by the following persons on behalf of the
Registrant and in the
capacities and on the dates indicated.
Dated: May 15, 1998 By: /s/ Robert Gordon
Robert Gordon
President & Principal
Executive Officer
and Principal Financial
and Accounting
Officer
Dated: May 15, 1998 By: /s/ Gera Laun
Gera Laun
Secretary
Dated: May 15, 1998 By: /s/ Joseph J. Messina
Joseph J. Messina
Director
Dated: May 15, 1998 By: /s/ Martin I. Saposnick
Martin I. Saposnick
Director
Dated: May 15, 1998 By: /s/ David A. Vigor
David A. Vigor
Director
Dated: May 15, 1998 By: /s/ William C. Hayde
William C. Hayde
Director
