SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended December 31, 1998 Commission File No. 0-18377
NuOASIS RESORTS INC.
(Exact name of registrant as specified in its charter)
Nevada 84-1126818
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
4695 MacArthur Court, Suite 1450, Newport Beach, CA 92660
(Address of principal executive offices) (Zip Code)
(949) 833-5381
(Registrant's telephone number, including area code)
N/A N/A
(Former Address, if changed since last report) (Former Zip Code, if changed
since last report)
N/A
(Former telephone number, if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for shorter period that the Company was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes No X
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of capital stock as of the latest practicable date.
Common Stock $.01 par; 66,914,300 shares as of Decemember 31, 1998
<PAGE>
NuOASIS RESORTS INC.
INDEX
Page
PART I
Item 1. Financial Statements
Condensed Consolidated Balance Sheet
as of December 31, 1998 (unaudited)................................ 1
Condensed Consolidated Statements of Operations
for the Three and Six Months Ended December 31,
1998 and 1997 (unaudited).......................................... 2
Condensed Consolidated Statements of Cash Flows for the Six Months
Ended December 31, 1998 and 1997 (unaudited)....................... 3
Notes to Condensed Consolidated Financial Statements ................ 4
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.............................................. 9
PART II
Item 1. Legal Proceedings................................................... 11
Item 2. Changes In Securities............................................... 11
Item 3. Defaults Upon Senior Securities..................................... 11
Item 4. Submission Of Matters To A Vote Of Security Holders................. 11
Item 5. Other Information................................................... 11
Item 6. Exhibits And Reports On Form 8-K.................................... 11
Signatures.......................................................... 12
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<TABLE>
<CAPTION>
NuOASIS RESORTS INC.
Condensed Consolidated Balance Sheet
As of December 31, 1998 (Unaudited)
<S> <C>
ASSETS
Current assets:
Cash $ 161,489
Amounts receivable, net 563,803
Equity investments 687,500
Inventory 175,643
Other current assets 90,205
Total current assets 1,678,640
Property and equipment, net 104,810
Other assets:
Equity investments 2,000,000
Receivable from STTG 1,084,375
Land held for development 3,700,000
Other 513,515
Total other assets 7,297,890
TOTAL ASSETS $ 9,081,340
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 2,071,936
Accrued expenses 4,228,885
Due to affiliates, net 142,939
Note Payable to Affiliate 3,000,000
Current portion of notes payable 772,883
Total current liabilities 10,216,643
Notes Payable, net of current portion 3,355,680
Total liabilities 13,572,323
Stockholders' equity (deficit):
Preferred stock, Series D, $.01 par value;
24,000,000 shares authorized, issued and outstanding
(aggregate liquidation value of up to $10,000,000) 240,000
Common stock, $.01 par value; 75,000,000 shares
authorized; 66,914,300 shares issued and outstanding 669,143
Additional paid-in-capital 42,364,414
Common stock subscriptions receivable (566,041)
Other comprehensive loss (404,314)
Accumulated deficit (46,794,185)
Total stockholders' equity (deficit) (4,490,983)
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) $ 9,081,340
</TABLE>
See accompanying notes to these condensed consolidated financial statements
1
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<TABLE>
<CAPTION>
NuOASIS RESORTS INC.
Condensed Consolidated Statements of Operations
for Three and Six Months Ended
December 31, 1998 and 1997 (Unaudited)
<S> <C> <C> <C> <C>
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenue:
Hotel Rooms and Food $ 981,000 $ 400,065 $ 2,820,100 $ 400,065
Food Distribution 131,168 177,455 262,336 428,504
Total revenue 1,112,168 577,520 3,082,436 828,569
Cost of Revenue:
Cost of Hotel Rooms and Food 1,294,000 382,022 2,920,700 382,022
Cost of food distribution 119,498 67,099 238,996 243,955
Total cost of revenue 1,413,498 449,121 3,159,696 625,977
Gross (loss) profit (301,330) 128,399 (77,260) 202,592
Depreciation and amortization 10,023 69,031 20,046 130,679
Legal and professional fees 294,025 281,298 588,050 642,150
Selling, general and administrative
expenses 753,350 1,541,399 1,506,700 1,885,845
Minority interest - (387,856) - (423,376)
Total operating expenses 1,057,398 1,503,872 2,114,796 2,235,298
Operating (loss) (1,358,728) 1,375,473) (2,192,056) (2,032,706)
Equity in earnings (loss) in affiliates - (50,967) - 172,131
Interest and other expenses, net (134,222) 9,404 (268,444) 2,381
(134,222) (41,563) (268,444) 174,512
Net (loss) $(1,492,950) $(1,417,036) $(2,460,500) $(1,858,194)
Items of other comprehensive income:
Foreign currency translation adjustments $ 38,695 $ - $ 77,392 $ -
Basic and diluted loss per common share $ (.02) $ (.03) $ (.03) $ (.04)
Weighted average number of common
shares outstanding used to compute
basic and diluted loss per common share 66,914,300 48,840,300 66,914,300 48,840,300
</TABLE>
See accompanying notes to these condensed consolidated financial statements
2
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<TABLE>
<CAPTION>
NuOASIS RESORTS INC.
Condensed Consolidated Statements of Cash Flows
for the Six Months Ended
December 31, 1998 and 1997 (Unaudited)
<S> <C> <C>
Six Months Ended
December 31,
1998 1997
(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(2,460,500) $(1,858,194)
Adjustments to reconcile net income (loss) to net
cash(used) provided by operating activities:
Depreciation and amortization 20,046 130,679
Minority interest - (423,376)
Equity in (income) losses in equity investments - (172,131)
Increases (decreases) in changes in assets
and liabilities:
Accounts receivable, net of due from affiliates 122,743 1,669,394
Inventory 28,122 2,142
Other assets 123,457 (275)
Accounts payable 123,689 1,873,196)
Accrued expenses 1,264,355 (19,561)
Due to affiliates 891,945 1,448,223
Net cash provided (used) by operating activities 113,857 (1,096,295)
CASH FLOWS FROM INVESTING ACTIVITIES:
Fixed asset additions (27,999) -
Proceeds from note receivable - 50,000
Proceeds from sale of assets and investments 27,500 615,353
Net cash (used) provided by investing activities (499) 665,353
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds received from issuance of note payable - 1,059,364
Principal payments on notes and leases payable - (73,117)
Advances to STTG (99,483) -
Net cash (used) provided by financing activities (99,483) 986,247
Net increase in cash 13,875 555,305
Cash and cash equivalents, beginning of period 147,739 576,734
Cash and cash equivalents, end of period $ 161,614 $ 1,132,039
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ - $ 18,425
</TABLE>
See accompanying notes to these condensed consolidated financial statements
3
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 (Unaudited)
1. Summary of Significant Accounting Policies and Description of Business
Description of Business
NuOasis Resorts, Inc. (formerly, Nona Morelli's II, Inc.) and its subsidiaries
(the "Company"), a Nevada corporation (formerly, a Colorado corporation),
operates as a holding company for leisure and entertainment-related businesses.
At December 31, 1998, the Company had seven wholly-owned subsidiaries and two
majority-owned subsidiaries engaged in food manufacturing and distribution,
casino gaming and hotel management.
The activities of the Company's subsidiaries are domestic and international,
with existing food manufacturing activities in the United States, and casino
gaming and hotel management activities in North Africa.
Restructuring
In July 1998, the Company entered into various agreements with Cleopatra and
Cleopatra's World, and other related Cleopatra subsidiaries, to effect a
restructuring which resulted in the Company disposing of its interest in
Cleopatra, decreasing its interest in Cleopatra Hammamet, and increasing its
interest in Cleopatra's World. To effect the restructuring (a) Cleopatra and
Cleopatra's World assigned to a newly-formed entity, Cleopatra Palace Resorts
and Casinos Limited a British corporation ("CPRC"), all of their rights, title
and interest in and to (i) the Letter of Intent dated July 7, 1996 between
Compagnie Monastirienne Immobiliere et Touristique S.A. ("CMI") and Cleopatra,
(ii) the Letter of Intent between Cleopatra and CMI dated July 7, 1996, (iii)
Cleopatra's rights to the Casino Lease and gaming license between Cleopatra and
the Government of Morocco, (iv) Cleopatra's rights to acquire certain real
estate and the building known as the "Casino Nuevo San Roque" together with the
gaming license and the agreement in principle with Trans Mer S.A. to finance the
project, (v) certain trade accounts receivable, and (vi) Cleopatra's right to
the $1.5 million deposit which it tendered to Club Loisirs Hammamet, the Lessor
of the Hammamet Casino. As a result of the Cleopatra restructuring, the Company
became the 75% owner of CPRC and acquired an additional 10% equity interest in
Cleopatra's World.
Principles of Consolidation
The December 31, 1998 consolidated financial statements, and references therein
to the Company, include the accounts of the Company and its wholly-owned
subsidiaries; NuOasis International, Inc. ("NuOI"), Fantastic Foods
International, Inc. ("Fantastic Foods"), Casino Management of America, Inc.
("CMA") NuOasis Laughlin, Inc., ("NuLA") NuOasis Las Vegas, Inc. ("NuLV"), ACI
Asset Management Inc. ("ACI") and NuOasis Properties, Inc. ("NuOasis
Properties"), its 70% owned subsidiary, Cleopatra Palace Limited ("Cleopatra"),
and its 60% owned subsidiary Cleopatra's World, Inc. ("Cleopatra's World" or
"CWI"). The accounts of Oasis Resorts, Inc. have been included since October 19,
1998.
All material intercompany accounts and transactions have been eliminated in
consolidation.
4
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NuOASIS RESORTS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 (Unaudited)
1. Summary of Significant Accounting Policies and Description of Business
(continued)
Going Concern Considerations
The Company has recurring losses from operations, and at December, 31, 1998, the
Company has a working capital deficit of $8 million. The Company requires
approximately $5 million of immediate working capital to complete the final
phase of construction of the Le Palace Hotel & Resort and the Cleopatra Cap
Gammarth Casino, as well as service certain past-due trade creditors. The
Company will require additional capital to meet obligations of the hotel and
casino as they become due during the next 12 months. The Company is currently a
plaintiff in litigation with the owners of the Cleopatra Cap Gammarth Casino due
to delays in the completion of the project by the owner. The Company has
received a judgment totaling approximately $292 million against Societe
D'Animation et de Loisirs Touristique, a Tunisian corporation ("SALT"), the
ultimate collectibility of which is unknown. The Company is a defendant in a
matter initiated by the owners of the Le Palace Hotel & Resort for unpaid rents.
Unaudited Interim Financial Statements
The interim financial data as of December 31, 1998, and for the six months ended
December 31, 1998 and 1997, is unaudited; however, in the opinion of management,
the interim data includes all adjustments, consisting only of normal recurring
adjustments, necessary to present fairly and Company's financial position as of
December 31, 1998, and the results of its operations and cash flows for the six
months ended December 31, 1998 and 1997.
2. Acquisition and Liquidation of Investments
In July 1998, Cleopatra, Cleopatra's World, and certain other Cleopatra-themed
entities effected a restructuring which resulted in the Company disposing of its
interest in Cleopatra, decreasing its rights to future equity interests in
Cleopatra Hammamet and increasing its interest in Cleopatra's World.
Cleopatra's World
Effective April 30, 1998, the Company acquired an additional 10% equity interest
in Cleopatra's World in exchange for $10,000,000 of notes payable issued by
NuOasis Resorts, Inc., 2,000,000 shares of treasury stock (Note 7), and 280,000
shares of common stock of The Hartcourt Companies Inc. In addition, the Company
also transferred its rights under the Warrant Note and the Put (see below) to
Cleopatra's World. As a result of this exchange, the Company's interest in
Cleopatra's World increased from 50% to 60% and, accordingly, the accounts of
Cleopatra's World are consolidated with those of the Company.
5
<PAGE>
NuOASIS RESORTS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 (Unaudited)
2. Acquisition and Liquidation of Investments (continued)
Oasis resorts Inc., formerly Flexweight Corporation
In May 1998, the Company entered into an "Exchange Agreement" with Flexweight
Corporation (currently, Oasis Resorts, Inc.) whereby the Company issued
3,250,000 shares of treasury stock in exchange for 1,000,000 shares of common
stock of Flexweight Corporation and an option to purchase shares in the future
such that the Company may maintain a 19.5% equity interest in Flexweight
Corporation or $2.5 million in market value.
On October 19, 1998, ORI then entered into an exchange agreement with NuOI to
acquire NuOI's 75% interest in CPRC. In connection with its acquisition of CPRC,
ORI issued to NuOI, 1,363,450 shares of ORI common stock, common stock purchase
warrants representing the right to acquire 7,200,000 shares at $30.00 per share,
and promissory notes with an aggregate face value of $180 million. CPRC had
previously acquired an equity interest in Cleopatra Cap Gammarth, which operates
the casino Cleopatra Cap Gammarth, a right to reacquire an interest in Cleopatra
Hammamet Limited, which operates the casino Cleopatra Hammamet Casino, and CWI
which operates the Le Palace Hotel & Resort at Cap Gammarth. All of the
properties are located in Tunisia. CPL is a predecessor company to CPRC, an
entity controlled by NuOI, which previously held the interests in the Cleopatra
Hammamet Casino and the Cleopatra Cap Gammarth Casino.
As to any future projects undertaken by the Company, NuOI, Cleopatra or
Cleopatra's World, additional project financing will be required. Capital
investments may include all or some of the following: acquisition and
development of land, acquisition of leasehold investments and contract rights,
and construction of other facilities. In connection with development activities
relating to potential acquisitions or new jurisdictions, the Company also makes
expenditures for professional services which are expenses as incurred. The
Company's financing requirements depend upon actual development costs, the
amounts and timing of such expenditures, the amount of available cash flow from
operations, the availability of other financing arrangements including selling
equity securities, and selling or borrowing against assets (including current
facilities). The Company may also consider strategic combinations or alliances.
Although there can be no assurance that the Company can effectuate any of the
financing strategies discussed above, the Company believes that if it determines
to seek any additional licenses to operate gaming or permits to conduct hotel
operations in other jurisdictions it will be able to raise sufficient capital to
pursue its strategic plan.
If for any reason, Cleopatra or Cleopatra's World are unable to borrow or
otherwise meet their commitments under current agreements to provide the
furniture, fixtures, equipment and working capital to open the Cap Gammarth
Casino, or acquire and develop future casino gaming and hotel management
projects, the Company may be required to intercede and seek to provide the
requisite financing and working capital, or be forced to sell all or a portion
of the respective interests, or lose the respective rights to the projects and
properties entirely.
6
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NuOASIS RESORTS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 (Unaudited)
3. Legal Proceedings
In July 1998, the Company filed a complaint for damages against SALT and several
others due to significant delays in completing the Cleopatra Cap Gammarth
project. In July 1999, the Company received a judgment of approximately $300
million against SALT. Although management is proceeding to collect upon this
judgment, there can be no assurance that the Company will ultimately realize any
amount from this judgment, and the accompanying financial statements do not
include amounts related to this gain contingency.
The Company is also a party to litigation with STTG due to significant delays in
completing the Le Palace Hotel. Through December 30, 1998, the Company has not
paid rent to STTG in connection with the related lease arrangement. However, the
Company has purchased equipment and has paid opening costs of approximately $1.8
million, which were the responsibility of STTG. Subsequent to December 31, 1998,
STTG received an arbitration award for calendar 1998 and 1997 rental payments,
net of amounts expended by the Company. As a result, the accompanying financial
statements include an estimate for rent at the Hotel based upon the arbitration
award.
In November 1998, Group V Corporation and Joe Monterosso filed a claim against
the Company in connection with the purchase of securities from the Company
alleging material misrepresentation. In July 1999, the Company filed a cross
complaint against Group V Corporation and Joe Monterosso. The trial date for the
action is set for September 2000. Management believes the suit lacks substantial
merit and plans to vigorously defend against the complaint and pursue the cross
complaint. No provision has been made in the accompanying financial statements
for this contingency.
4. Subsequent Events
In December 1998, the Hammamet Casino opened. The Company financed the
completion and opening of the Hammamet Casino through a financing agreement with
Cedric International Company Inc., a Panamanian corporation ("Cedric") pursuant
to which the Company and Cedric each agreed to contribute $1.5 million to the
capital of Cleopatra Hammamet. The Company pledged its rights to equity
interests in Hammamet to Cedric to secure the certain loans and investment by
Cedric. The Company and Cedric agreed that Cedric would return such interest
when, and if, the Company reimbursed Cedric for all funds advanced prior to the
first anniversary date of the agreement (on an all-or-nothing basis), plus
interest at the rate of 15% per annum. The Company did not reimburse Cedric, due
to sustained losses at the Hammamet Casino, and the Company forfeited its right
to reacquire its interest in Cleopatra Hammamet. Accordingly, the Company
impaired its interest in Cleopatra Hammamet.
7
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NuOASIS RESORTS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 (Unaudited)
4. Subsequent Events (continued)
In connection with its acquisition of CPRC, ORI issued 1,363,450 shares of ORI
common stock, common stock purchase warrants representing the right to acquire
7,200,000 shares at $30.00 per share, and promissory notes with an aggregate
face value of $180 million to NuOI. At the time of the transaction, ORI had no
ability to repay the notes, and therefore, the notes had an estimated fair value
substantially less than the face value at the date of issuance. Based on the
estimated enterprise value of ORI at the date of the acquisition of
approximately $16.6 million, management valued the debt at $7 million. On
November 15, 1999, management of ORI agreed to extinguish this debt and cancel
the 7,200,000 warrants for the issuance of an additional 8,111,240 shares of ORI
common stock. As a result, after the transaction, NuOI shareholders controlled
approximately 86% of the ORI's issued and outstanding common stock.
Spinoff of five wholly-owned subsidiaries
In February 2000, the Company completed the spinoff of five of its wholly-owned
subsidiaries CMA, NuLA, NuLV, ACI and NuOasis Properties. The spinoff was
effected through the distribution of 812,500 shares of common stock and 300,000
shares of Series A preferred stock of each subsidiary to the respective NuOasis
shareholders of record on June 30, 1999. The shares of each of these companies
are restricted and no market is expected to develop until each of the
subsidiaries has filed a registration statement on Form 10-SB, and other reports
as required. In February 2000, registration statements on Form 10-SB were filed,
but were subsequently retracted. Each subsidiary intends to file a new
registration statement so that the unregistered shares become registered.
Treasury Shares
During the year ended June 30, 1999, the Company sold all of the remaining
Treasury Shares. The total amount received from the sale of 9,430,000 shares
amounted to $408,663. Because the fair value of the Company's common stock
issued in these transactions was less than the $.50 per share basis of the
common stock, the Company has reduced additional paid in capital for the
difference, which aggregated $4,306,537 during the year ended June 30, 1999.
8
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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Going Concern
The Company's working capital resources during the period ended December 31,
1998 were provided by utilizing the cash on hand at June 30, 1998 and from the
operations of the Le Palace Hotel. The Company has experienced recurring net
losses, has limited liquid resources and negative working capital. Management's
intent is to continue searching for additional sources of capital and, in the
case of NuOasis International, new casino gaming and hotel management
opportunities. In the interim, the Company intends to continue operating with
minimal overhead and key administrative functions provided by consultants who
are compensated in the form of the Company's common stock. It is estimated,
based upon its historical operating expenses and current obligations, that the
Company may need to utilize its common stock for future financial support to
finance its needs during fiscal 1999. Accordingly, the accompanying consolidated
financial statements have been presented under the assumption the Company will
continue as a going concern.
Results of Operations -
Quarter Ended December 31, 1998 Compared to Quarter Ended December 31, 1997
Revenues for the second quarter of fiscal 1999 were $1.1 million compared to $.6
million of revenues in the fiscal 1998 second quarter. The increase in revenues
was entirely due to the operations of the Le Palace Hotel Tunisia which began
operations in December 1997. To date, the hotel has not been able to realize its
potential due the failure of the developer to complete certain amenities at the
hotel, the Cap Gammarth Casino and the surrounding properties associated with
the complex. As the LePalace Hotel is a tourist resort, the occupancy is
seasonal with higher occupancy in the summer months which accounts for the
significant reduction in revenues in the second fiscal quarter.
Total cost of revenues were $1.4 million in the current quarter compared to $.5
million in the fiscal 1998 quarter. As in revenues, the increase is due the
operations of the LePalace Hotel which only opened in December 1997. The
operating results of the LePalace Hotel were less than anticipated due to lower
than expected occupancy levels due to the developer not completing the adjoining
properties in the Cap Gammarth complex. Additionally, the hotel is required to
maintain minimum staffing even during the off season.
Six Months Ended December 31, 1998 Compared to the Six Months Ended December
31, 1997
Revenues for the first six months of fiscal 1999 were $3.0 million compared to
$.8 million of revenues in the comparable fiscal 1998 period. The increase in
revenues was entirely due to the operations of the Le Palace Hotel Tunisia which
began operations in December 1997. To date, the hotel has not been able to
realize its potential due the failure of the developer to complete certain
amenities at the hotel, the Cap Gammarth Casino and the surrounding properties
associated with the complex. As the LePalace Hotel is a tourist resort, the
occupancy is seasonal with higher occupancy in the summer months which accounts
for the significant reduction in revenues in the second fiscal quarter.
9
<PAGE>
Total cost of revenues were $3.1 million in the first six months of fiscal 1999
compared to $.6 million in the fiscal 1998 period. As in revenues, the increase
is due the operations of the LePalace Hotel which only opened in December 1997.
The operating results of the LePalace Hotel were less than anticipated due to
lower than expected occupancy levels due to the developer not completing the
adjoining properties in the Cap Gammarth complex. Additionally, the hotel is
required to maintain minimum staffing even during the off season.
Liquidity and Capital Resources
The Company has recurring losses from operations and requires approximately $5
million of immediate working capital to complete the final phase of construction
of the Le Palace Hotel and Resort and the Cleopatra Cap Gammath Casino and
service certain trade creditors. The Company will require additional capital to
meet obligations of the hotel and casino as they become due during the next 12
months. The Company is currently a plaintiff in litigation with the owners of
the Cleopatra Cap Gammarth Casino due to delays in the completion of the
projects by the owner. The Company has received a judgment totaling
approximately $300 million, the ultimate collectibility of which is unknown. The
Company is a defendant in a matter initiated by the owners of the Le Palace
Hotel and Resort for rents unpaid by the Company. The Company also requires
approximately $70 million to continue the development of its gaming facility in
Oasis, Nevada, and may be subject to foreclosure proceedings in the event the
Company is unable to raise the financing necessary to complete the project.
These factors raise substantial doubt about the Company's ability to continue as
a going concern. Management's plans with respect to these matters include
obtaining sources of capital to complete the projects, pay its trade creditors
and its past-due rents. Meanwhile, the Company will attempt to perfect its
judgment against the landlords of the Cleoparta Cap Gammarth Casino. There are
no assurances that such financing will be consummated on terms favorable to the
Company, if at all, nor that the Company will be successful in collecting on its
judgment against the owners of the Cleopatra Cap Gammarth Casino.
As of December 31, 1998, the Company had a working capital deficit of $8
million, which approximates the deficit at June 30, 1998 after giving effect to
the consolidation of the Company with ORI.. The Company has currently been
accruing the rent due on the Le Palace Hotel and the resulting cash from
operations has been funding its cash needs.
The Company had a cash balance of approximately $161,000 at December 31, 1998.
The limited cash balance is a direct result of the Company having limited
operations during the quarters.
The Company has no commitments for capital expenditures or additional equity or
debt financing and no assurances can be made that its working capital needs can
be met.
Additionally, as of December 31, 1998, the Company had no employees other than
its President. The Le Palace Hotel had approximately 165 employees.
10
<PAGE>
PART II: OTHER INFORMATION
Item 1. Legal Proceedings
See details provided in Note 3 - Legal Proceedings and Note 4 - Subsequent
events regarding changes in any of the Company's legal proceedings.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit Number Description of Exhibit
27 Financial Data Schedule
(b) Reports on Form 8-K: None
11
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
NuOASIS RESORTS, INC.
Dated: December 21, 2000 By: /s/ Leonard J. Roman
Leonard J. Roman
Chief Financial Officer
and Director
