U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
|X| Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 1998
|_| Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from to
Commission file number 333-07727
Shampan, Lamport Holdings Limited
(Exact Name of Small Business Issuer as Specified in Its Charter)
Washington 98-0138706
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
1500-609 Granville Street, Vancouver, B.C. Canada V7Y 1G5
(Address of Principal Executive Offices)
(604) 687-0888
(Issuer's Telephone Number, Including Area Code)
(formerly named Allegiant Technologies Inc.)
(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 _________
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable Common stock, par value, $0.01 per
share, 6,748,251 shares of common stock outstanding as of September 30, 1998
Transitional Small Business Disclosure Format (check one):
Yes No X .
<PAGE>
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS-SEPTEMBER 30, 1998
SHAMPAN, LAMPORT HOLDINGS LIMITED
(formerly Allegiant Technologies Inc.)
(Expressed in United States Dollars)
FINANCIAL STATEMENTS
(Unaudited - Prepared by Management)
SEPTEMBER 30, 1998
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED (formerly Allegiant Technologies Inc.)
BALANCE SHEET
(Expressed in United States Dollars)
AS OF SEPTEMBER 30
<TABLE>
<CAPTION>
1997 1998
----------------- ----------------
<S> <C> <C>
ASSETS
Current assets:
Cash $ 31,084 $ 26,741
Accounts receivable, net 26,803 246
Other receivable - -
Inventories 119,342 -
Prepaid expenses 10,570 3,750
---------------- ----------------
Total current assets 187,799 30,737
Property and equipment, net 39,500 -
---------------- ----------------
Total assets $ 227,299 $ 30,737
================ ================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Debentures payable $ 500,000 $ -
Notes payable 100,000 192,500
Accounts payable and accrued liabilities 873,574 53,388
Deferred revenues 22,681 -
---------------- ----------------
Total current liabilities 1,496,255 245,888
---------------- ----------------
Shareholders' equity:
Capital stock
Authorized
50,000,000 preferred shares, par value $0.01 per share
100,000,000 common shares, par value $0.01 per share
Issued and outstanding
6,748,251 common shares 83,930 67,483
Additional paid-in capital 4,062,235 4,843,682
Accumulated deficit (5,415,121) (5,126,316)
--------------- ---------------
Total shareholders' equity (1,268,956) (215,151)
--------------- ---------------
Total liabilities and shareholders' equity $ 227,299 $ 30,737
================ ================
</TABLE>
Unaudited - Prepared by Management
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED (formerly Allegiant Technologies Inc.)
STATEMENTS OF OPERATIONS
(Expressed in United States Dollars)
<TABLE>
<CAPTION>
Three Month Period Ended Nine Month Period Ended
September 30, September 30,
1997 1998 1997 1998
----------------- ------------- ---------------- ------------
<S> <C> <C> <C> <C>
NET REVENUE $ 61,045 $ - $ 515,402 $ 62,541
COST OF REVENUE 32,759 - 182,529 18,415
----------------
GROSS PROFIT 28,286 - 332,873 44,126
----------------
EXPENSES
Sales and marketing 30,077 - 270,512 24,837
Research and development 15,430 - 231,454 1,840
General and administrative 65,047 18,480 471,303 94,458
Amortization of purchase of intangibles - - 62,298 -
---------------- -------------- --------------- ---------
137,881 18,480 1,035,567 121,135
---------------- -------------- --------------- ---------
Loss from operations (109,595) 18,480 (702,694) (77,009)
--------------- --------------- -------------- --------
OTHER INCOME (EXPENSE)
Interest (2,339) (3,750) (27,500) (8,750)
Finance fee - - (15,000)
Gain (loss) on disposal of property - 949 (48,981) 5,002
Write-off of intangibles - - (197,293) -
Gain on settlement of obligations - 1,700 - 7,113
---------------- -------------- --------------- ---------
(2,339) (1,101) (273,774) (11,635)
--------------- -------------- --------------- ---------
Net loss for the period $ (111,934) $ (19,581) $ (976,468) $ (88,644)
=============== ============== =============== ===========
Loss per share $ (0.01) $ (0.003) $ (0.12) $ (0.013)
=============== ============== =============== ===========
Shares used in computing per share amounts 8,393,007 6,748,251 8,393,007 6,748,251
================ =============== ================ ==========
</TABLE>
Unaudited - Prepared by Management
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED
(formerly Allegiant Technologies Inc.)
STATEMENTS OF SHAREHOLDERS' EQUITY
(Expressed in United States Dollars)
<TABLE>
<CAPTION>
Additional Total
Number Paid-in Accumulated Shareholders'
of Shares Par Value Capital Deficit Equity
<S> <C> <C> <C> <C> <C>
Balances at December 31, 1996 8,107,295 $ 81,073 $ 3,965,092 $ (4,438,653) $ (392,488)
Shares issued 285,712 2,857 - c97,143 - 100,000
Net loss - - - (976,468) (976,468)
-------------- -------------- ---------------- ---------------- ---------------
Balances at September 30, 1997 8,393,007 83,930 4,062,235 (5,415,121) (1,268,956)
Shares cancelled (650,000) (6,500) 6,500 - -
Net income - - - 377,449 377,449
-------------- ---------------- ---------------- ---------------- ---------------
Balances at December 31, 1997 7,743,007 77,430 4,068,735 (5,037,672) (891,507)
Shares issued 5,600,000 56,000 - 154,000 - 210,000
14,400,000 144,000 - 396,000 - 540,000
Shares cancelled (1,350,000) (13,500) 13,500 - -
4:1 Reverse split (19,794,756) (197,947) 197,947 - -
Shares issued 150,000 1,500 13,500 - 15,000
Net loss - - - (88,644) (88,644)
-------------- --------------- ---------------- --------------- ---------------
Balances at September 30, 1998 6,748,251 $ 67,483 $ 4,843,682 $ (5,126,316) $ (215,151)
============== =============== ================ ================ ===============
</TABLE>
Unaudited - Prepared by Management
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED (formerly Allegiant Technologies Inc.)
STATEMENTS OF CASH FLOWS
(Expressed in United States Dollars)
<TABLE>
<CAPTION>
Three Month Period Ended Nine Month Period Ended
September 30, September 30,
1997 1998 1997 1998
----------------- --------------- ----------------- ------------
<S> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net loss for the period $ (111,934) $ (19,581) $ (976,468) $ (88,644)
Adjustments to reconcile net loss to net cash
used in operating activities
Amortization and depreciation 2,550 - 116,028 -
Write-off of intangible - - 197,293
(Gain) loss on disposal of property 27,327 (949) 48,981 (5,002)
Changes in operating assets and liabilities
Accounts and other receivables (586) 2,754 10,281 12,396
Inventories 28,485 - 80,861 38,146
Prepaid expenses and deposits 14,978 3,890 48,880 (3,750)
Accounts payable and accrued liabilities 21,246 301 148,898 (25,791)
Deferred revenues (1,774) - (11,882) -
--------------- -------------- --------------- ---------------
(19,708) (13,585) (337,128) (72,645)
--------------- -------------- --------------- ---------------
INVESTING ACTIVITIES
Proceed on sale of property and equipment 17,404 949 68,879 21,641
--------------- -------------- --------------- ---------------
FINANCING ACTIVITIES
Proceeds from issuance of capital stock - - 100,000 765,000
Proceeds from notes payable - - 100,000 50,000
Payment on notes payable - (6,000) - (22,500)
Payment on subscription payable - - - (750,000)
Deferred costs - - 150,000 -
Deferred rent - - (36,502) -
Amortization of debt discount - - 4,225 -
--------------- -------------- --------------- ---------------
- (6,000) 182,723 42,500
--------------- -------------- --------------- ---------------
Increase (decrease) in cash (2,304) (18,636) (85,526) (8,504)
Cash, beginning of period 33,388 45,377 116,610 35,245
--------------- -------------- --------------- ---------------
Cash, end of period $ 31,084 $ 26,741 $ 31,084 $ 26,741
================ ============== =============== ================
</TABLE>
Unaudited - Prepared by Management
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED
(formerly Allegiant Technologies Inc.)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
SEPTEMBER 30, 1998
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations
The Company was incorporated in Washington State, U.S.A. on December 28,
1993 and changed its name from Allegiant Technologies Inc. to Shampan, Lamport
Holdings Limited effective July 21, 1998.
The Company discontinued its principal line of business on May 31, 1998 and
disposed of its technology assets.
Management Plans on Continued Existence
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, in the United States, which
contemplates the continuation of the Company as a going concern. However, the
Company sustained substantial operating losses and used substantial amounts of
working capital in its prior operations. As of September 30, 1998, current
liabilities exceeded current assets by $215,151, and total liabilities exceeded
total assets by $215,151.
Management is exploring and intends to enter into as yet undetermined new
lines of business, which may be highly speculative. The Company will remain
dormant until additional financing is secured and such new operations are
determined.
2. NOTES PAYABLE
<TABLE>
<CAPTION>
1997 1998
-------------- ---------------
<S> <C> <C>
Notes payable - due on demand at any time after May 1, 1999. The notes are
secured by the assets of the Company and bear interest at 10% per annum. $ 100,000 $ 150,000
Note payable, due November 4, 1998. The note is unsecured, non-interest bearing
and convertible into common shares of the Company at the option of the holder at
any time after October 30, 1998 and before November 4, 1998 at a deemed price
per share equal to the average closing price of the Company's shares on the
Vancouver Stock Exchange for the ten days immediately proceeding November 4,
1998.
- 42,500
--------------- ----------------
$ 100,000 $ 192,500
=============== ================
</TABLE>
3. CAPITAL STOCK
Stock options
The Company established a stock option plan ("the Plan") to grant options
to purchase common stock to employees, officers, non-employee directors of the
Company and certain other individuals. The Plan authorizes the Company to issue
or grant stock options to purchase up to 2,517,902 shares of its common stock as
of September 30, 1998.
At September 30, 1998, there were no stock options granted.
<PAGE>
SHAMPAN, LAMPORT HOLDINGS LIMITED
(formerly Allegiant Technologies Inc.)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
SEPTEMBER 30, 1998
3. CAPITAL STOCK
Warrants
As of September 30, 1998, the Company has outstanding warrants
entitling the holders to purchase a total of 1,754,761 common shares of the
Company as follows:
<TABLE>
<CAPTION>
Number Exercise
of Shares Price Expiration Date
<S> <C> <C>
71,428 1.60 April 15, 1999
1,683,333 0.15 until October 15, 1998 October 15, 1999
------------
0.1725 October 16, 1998 to
October 15, 1999
1,754,761
============
</TABLE>
4. RELATED PARTY TRANSACTIONS
During the nine month period ended September 30, 1997 and 1998, the
Company paid or accrued, the following amounts to related parties:
<TABLE>
<CAPTION>
1997 1998
------------ ----------------
<S> <C> <C>
Management fees $ 45,000 $ 27,000
Rent - 11,250
Interest - 8,750
Finance fee - 15,000
--------------- ----------------
$ 45,000 $ 62,000
=============== ================
</TABLE>
Included in notes payable and accrued liabilities is the aggregate
amount of $166,750, including accrued interest of $16,750, owing to a director
of the Company.
<PAGE>
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Overview
The Company was principally engaged in the development and marketing of
interactive multimedia software. As at September 30, 1998 the Company had
cumulative net losses of $5,126,316. On May 31, 1998 the Company ceased these
operations and disposed of its technology assets to an arms length purchaser.
The proceeds from the sale were used to settle certain obligations of the
Company. Presently, management is exploring and intends to enter into as of yet
undetermined new lines of business, which may be highly speculative. The Company
will remain dormant until additional financing is secured and such new
operations are determined.
Liquidity and Capital Resources
As of September 30, 1998 the Company had cash equivalents of $26,741 and a
working capital deficit of $215,151. Total liabilities exceeded the book value
of total assets by $215,151. Included in liabilities is the aggregate sum of
$166,750 due to related parties. The Company's ability to satisfy projected
working capital requirements is dependent upon its ability to secure additional
funding through public or private sales of securities, including equity
securities of the Company. There are no assurances that the Company will be able
to secure such requisite funding.
The Company's primary future needs for capital are for exploring and entering
into as of yet undetermined new lines of business.
Results of Operation
The Company's revenues decreased by 88% from $515,402 for the nine months ended
September 30, 1997 to $62,541 for the nine months ended September 30, 1998. This
precipitous decline was a direct result of the Company's inability to
effectively market, develop and support its products due to insufficient
resources and was the principle reason why the Company ceased operations.
During the year the Company completed a capital reorganization and settled a
substantial portion of debts that wer outstanding at the end of its last fiscal
year. The Company ceased business operations on May 31, 1998 and sold its
technology assets. Corporate overhead has been substantially curtailed and the
Company will remain dormant until additional financing is secured and new
operations are determined.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
ITEM 2. CHANGES IN SECURITIES
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
ITEM 5. OTHER INFORMATION
Item's 1, 2, 3, 4, and 5 are not applicable.
ITEM 6. EXIBITS AND REPORTS ON FORM 8-K
None filed during the period ended September 30, 1998
<PAGE>
SIGNATURE
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, in the City of Chicago,
State of Illinois, on October 22, 1998.
SHAMPAN, LAMPORT HOLDINGS LIMITED.
By: /s/Steven A. Rothstein
Steven A. Rothstein
President and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND THE STATEMENT OF OPERATIONS ATTACHED AS AN EXHIBIT TO THE COMPANY'S
FORM 10-QSB FOR THE SIX MONTHS ENDED JUNE 30, 1998, AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 26,7441
<SECURITIES> 0
<RECEIVABLES> 246
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 30,737
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 30,737
<CURRENT-LIABILITIES> 245,888
<BONDS> 0
0
0
<COMMON> 4,911,165<F1>
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 30,737
<SALES> 62,541
<TOTAL-REVENUES> 62,541
<CGS> 18,415
<TOTAL-COSTS> 18,415
<OTHER-EXPENSES> 121,135
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,750
<INCOME-PRETAX> (85,759)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (2,885)<F2>
<CHANGES> 0
<NET-INCOME> (88,644)
<EPS-PRIMARY> (0.013)
<EPS-DILUTED> (0.013)
<FN>
<F1>This includes amounts paid in excess of par value.
<F2>This includes gain on the sale of PP&E of $5,002, gain on settlement of
obligations of $7,113 and a finance fee of $15,000.
</FN>
</TABLE>
