<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 March 31, 1997
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from to
--------- --------
Commission file number 000-22235
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Objective Communications, Inc.
- ------------------------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 54-1707962
- ------------------------------------------- ------------------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
14100 Park Meadow Drive
Chantilly, Virginia 20151
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(Address of Principal Executive Offices)
(703) 227-3000
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(Issuer's Telephone Number, Including Area Code)
- ------------------------------------------------------------------------------
(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 No X
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APPLICATION ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 4,631,844
Transitional Small Business Disclosure Format (check one):
Yes No X
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<PAGE> 2
Part I - Financial Information
Item 1. Financial Statements
OBJECTIVE COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEETS
(UNAUDITED)
---------
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
------------ ----------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 238,786 $ 623,241
Accounts receivable 35,723 84,855
Inventory 471,358 366,099
Other current assets 364,123 178,376
------------ ----------------
Total current assets 1,109,990 1,252,571
Property and equipment: - net 355,969 182,072
Debt issue costs - net 149,533 214,066
Trademarks and patents 46,602 32,869
------------ ----------------
$ 1,662,094 $ 1,681,578
============ ================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable, net of unamortized discounts $ 1,909,334 $ 1,714,000
Notes payable, related parties 199,000 199,000
Accounts payable 482,663 390,438
Accrued liabilities 146,660 263,376
Obligations under capital lease 21,498 15,543
------------ ----------------
Total current liabilities 2,759,155 2,582,357
Obligations under capital lease 44,709 25,610
------------ ----------------
2,803,864 2,607,967
Redeemable Series A Convertible Preferred Stock, par value $.01,
500,000 authorized, 500,000 and 250,000 issued and outstanding
at March 31, 1997 and December 31, 1996, respectively 1,810,643 848,440
Shareholders' deficit:
Common stock, par value $.01, 10,000,000 shares authorized;
2,061,844 and 1,896,577 issued and outstanding at March 31, 1997
and December 31, 1996, respectively 20,619 18,966
Additional paid-in capital 4,027,825 3,371,115
Accumulated deficit (7,000,857) (5,164,910)
------------ ----------------
Total stockholders' deficit (1,141,770) (926,389)
------------ ----------------
$ 1,662,094 $ 1,681,578
============ ================
</TABLE>
<PAGE> 3
OBJECTIVE COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS
(UNAUDITED)
---------
<TABLE>
<CAPTION>
For the
period
October 5,
1993
(date of
Three months ended inception)
March 31, to March 31,
1997 1996 1997
------------- ----------- ----------------
<S> <C> <C> <C>
Operating revenues:
Merchandise revenue $ - $ - $ 175,301
Service revenue - 6,329 320,359
------------- ----------- ----------------
Total revenues - 6,329 495,660
------------- ----------- ----------------
Operating expenses:
Cost of merchandise - - 169,309
Cost of services - 5,382 80,066
Research and development 459,934 286,926 2,964,687
General and administrative 661,866 259,556 2,915,737
Depreciation 109,858 29,457 332,632
Other - - 15,997
------------- ----------- ----------------
Total operating expenses 1,231,658 581,321 6,478,428
------------- ----------- ----------------
Loss from operations (1,231,658) (574,992) (5,982,768)
Interest expense, net 210,387 3,062 611,192
------------- ----------- ----------------
Net loss $ (1,442,045) $ (578,054) $ (6,593,960)
============= =========== ================
Net loss per common share $ (0.40) $ (0.16) $ (1.83)
============= =========== ================
Weighted average common shares
and common share equivalents
outstanding 3,607,634 3,607,634 3,607,634
============= =========== ================
</TABLE>
<PAGE> 4
OBJECTIVE COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
(UNAUDITED)
---------
<TABLE>
<CAPTION>
For the period
October 5, 1993
(date of inception) to
Three months ended March 31, March 31,
1997 1996 1997
------------- ------------ ----------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (1,442,045) $ (578,054) $ (6,593,960)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation 44,533 29,001 217,618
Amortization 65,323 456 115,012
Interest expense related to issuance of warrants 195,334 - 517,123
Non-cash compensation expense 340,166 - 340,166
Stock issued in exchange for services rendered - - 55,834
Changes in operating assets and liabilities:
Accounts receivable 49,132 67,529 (35,723)
Other current assets (185,747) - (364,123)
Inventory (105,259) (86,277) (471,358)
Trademarks and patents (14,523) (9,589) (53,016)
Accounts payable 16,520 (66,259) 406,958
Accrued liabilities (116,716) 17,098 146,660
------------- ----------- ----------------
Net cash used in operating activities (1,153,282) (626,095) (5,718,809)
------------- ----------- ----------------
Cash flows from investing activities:
Purchase of property and equipment (191,985) (13,424) (493,984)
------------- ----------- ----------------
Net cash used in investing activities (191,985) (13,424) (493,984)
------------- ----------- ----------------
Cash flows from financing activities:
Proceeds from the issuance of preferred stock, net 962,203 - 1,810,643
Proceeds from the issuance of common stock, net - 542,000 2,061,240
Proceeds from the issuance of notes payable - - 2,550,000
Repayments of notes payable - - (250,000)
Proceeds from the issuance of notes payable to related parties - 40,000 716,223
Repayments of notes payable to related parties - - (165,000)
Debt issue costs - - (258,131)
Principal payments on capital leases (1,391) - (13,396)
------------- ----------- ----------------
Net cash provided by financing activities 960,812 582,000 6,451,579
------------- ----------- ----------------
Net increase (decrease) in cash and cash equivalents (384,455) (57,519) 238,786
Cash and cash equivalents at beginning of period 623,241 86,491 -
------------- ----------- ----------------
Cash and cash equivalents at end of period $ 238,786 $ 28,972 $ 238,786
============= =========== ================
</TABLE>
<PAGE> 5
OBJECTIVE COMMUNICATIONS, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with instructions to Form 10-QSB and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation of the financial position and the results of
operations for the interim period have been included. The interim financial
statements should be read in conjunction with the financial statements and
notes thereto in the Company's Registration Statement on Form SB-2 (File No.
333-20625), as amended, as filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended.
2. Capital Stock
Common Stock
During January 1997, the Company executed a warrant exchange agreement
(the "Exchange Agreement") with investors who purchased common stock and
received warrants through the Company's financial advisory firm during 1995 and
1996. The purpose of the warrant exchange was to induce such investors to enter
into lock-up arrangements with the Company's underwriter, Barington Capital
Group, L.P. (the "Underwriter"), and into agreements consolidating such
investors' registration rights with those granted by the Company to other
investors, and to provide those investors with the opportunity to invest in the
Company upon terms and conditions that more closely reflect the terms and
conditions upon which the other investors invested in the Company during a
comparable time period. As a result of the warrant exchange the Company issued
165,267 shares of common stock. The fair market value of such shares was
reflected in the first quarter of 1997 in a non-cash compensation expense of
$340,166 and a direct charge to equity of $320,902 as a cost of equity
financing. Additionally, the Company issued warrants for the purchase of
165,269 shares of common stock with an exercise price of $4.00 per share and
retired warrants for the purchase of 330,536 shares of common stock.
<PAGE> 6
OBJECTIVE COMMUNICATIONS, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
Preferred Stock
In December 1996, the Company authorized the issuance and sale of
500,000 shares of Series A Convertible Preferred Stock ("Series A Preferred
Stock") and warrants to purchase 100,000 shares of common stock for aggregate
consideration of $2,000,000. The Company issued 250,000 shares of Series A
Preferred Stock and warrants to purchase 50,000 shares of Common Stock and
received $1.0 million of the consideration in December 1996. The Company issued
250,000 shares of Series A Preferred Stock and warrants to purchase 50,000
shares of Common Stock and received $1.0 million of the consideration in
January 1997. All Series A Preferred Stock shares converted to Common Stock
shares, on a one-for-one basis, upon the completion of the initial public
offering of the Company in April 1997.
Warrants
In April 1997, in connection with the initial public offering, certain
holders of warrants issued in connection with bridge financing ("Bridge
Financing") in October and November 1996 (the "Bridge Warrants") surrendered
such warrants to acquire an aggregate of 150,000 shares of common stock. The
surrender and cancellation of such warrants did not have any other effect on
the Bridge Financing, nor did the Company pay any consideration in connection
with such surrender.
3. Net Loss Per Share
Net loss per share is based on the weighted average number of common
shares and dilutive common share equivalents outstanding during the periods
presented. Pursuant to Securities and Exchange Commission requirements, common
stock issued, convertible securities issued and options and warrants to
purchase shares of common stock granted by the Company during the twelve months
preceding the initial filing date of the Registration Statement have been
included in the calculation of weighted average common shares and common share
equivalents outstanding as if they were outstanding for all periods presented.
Options and warrants issued by the Company prior to the aforementioned
twelve-month period have not been included in the calculation because the
effects of such items were anti-dilutive
4. New Accounting Pronouncement
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings per Share" ("FAS
128"). FAS 128 simplifies the existing earnings per share ("EPS") computations
under Accounting Principles Board Opinion No. 15, "Earnings Per Share" ("APB
15"), revises disclosure requirements, and increases the comparability of EPS
data on the international basis. In simplifying the EPS computations, the
presentation of primary EPS is replaced with basic EPS, with the principal
difference being that common stock equivalents are not considered in computing
basic EPS. In addition, FAS 128 requires dual presentation of basic and diluted
EPS. FAS 128 is effective for financial statements issued for period ending
after December 15, 1997. The Company does not expect the EPS amounts calculated
under FAS 128 to be materially different from the amounts presented in the
financial statements under APB 15.
5. Subsequent Event
During April 1997, the Company received net proceeds of approximately
$7.8 million, including the exercise in full of the over-allotment option by
the Underwriter, (net of underwriting discounts and commissions and
approximately $2.7 million of related expenses payable by the Company) from
the issuance of 2.07 million shares of common stock of the Company at $5.50
per share, pursuant to the Company's initial public offering.
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation
Certain statements contained in this Quarterly Report on Form 10-QSB,
other than historical financial information, constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. All such forward-looking statements involve known and unknown risks,
uncertainties or other factors which may cause actual results, performance or
achievement of the Company to be materially different from any future results,
performance or achievement expressed or implied by such forward-looking
statements. Factors that might cause such a difference include risks and
uncertainties related to the Company's dependence on the emerging market for
video broadcast, retrieval and conferencing, development of additional
products, protection of its intellectual property, limited marketing
experience, limited number of customers, and need for additional personnel, as
well as risks and uncertainties associated with the Company's growth strategy,
technological changes affecting the Company and competitive factors affecting
the Company.
The following discussion should be read in conjunction with the
financial statements and notes thereto appearing elsewhere in this Quarterly
Report on Form 10-QSB.
OVERVIEW
The Company was incorporated in October 1993 to develop and produce
products and systems to support new communications devices that make extensive
use of broadband networks and transmit high-quality video and audio and high
speed data. The Company's operations to date have related primarily to
organizational activities, including research and development and
organizational efforts involving the development of its initial products,
including the VidPhone(R) system, recruiting management and technical personnel
and raising capital. Currently, the Company expects to complete development of
the VidPhone(R) system and begin commercial production and installation of the
first units in late 1997.
To date, the Company has not generated substantial revenues from the
sale of its products and services. As of March 31, 1997, the Company had
cumulative losses of $6.6 million. The Company expects to incur additional
operating losses for the foreseeable future. Through March 31, 1997, the
Company's operations had been funded primarily through private sales of debt
and equity securities.
In January 1997, the Company received gross proceeds of $1.0 million
from the issuance of 250,000 shares of Series A Preferred Stock and warrants to
purchase 50,000 shares of Common Stock.
In April 1997, the Company received net proceeds of approximately $7.8
million, including the exercise in full of the Underwriter's over-allotment
option (net of underwriting discounts and commissions and approximately $2.7
million of related expenses payable by the Company) from the issuance of 2.07
million shares of Common Stock at $5.50 per share, pursuant to the Company's
initial public offering (the "Offering"). Approximately $2.1 million
<PAGE> 8
of the gross proceeds of the Offering were used to retire outstanding
indebtedness under the promissory notes issued in the Bridge Financing during
October and November 1996. The remainder of the net proceeds of the Offering
are intended to be used to fund the Company's sales and marketing and product
development efforts, for working capital and general corporate purposes.
The Company expects to incur substantial operating expenses in the
future to support its development costs, expand its sales and marketing
capabilities and organization, expand its work force and for other general and
administrative expenses. The Company's results of operations may vary
significantly from quarter to quarter during this period of development.
RESULTS OF OPERATIONS
Comparison of the Three Months Ended March 31, 1997 and March 31, 1996
The Company did not have revenues for the three months ended March 31,
1997, which represented approximately a $6,000 decrease from the three months
ended March 31, 1996. Although the Company was formed to develop and produce
products and systems to support new, high-quality video and audio
communications devices, during the three months ended March 31, 1996, the
Company performed technical consulting services in order to generate revenues
during its start-up phase. The Company is not currently providing technical
consulting services and is focused exclusively on the development, production
and sale of the VidPhone(R) system and related software products.
Selling, general and administrative expenses increased by
approximately $402,000, or 155%, for the three months ended March 31, 1997, to
approximately $662,000 from $260,000 for the period ended March 31, 1996. The
increase in administrative expenses was primarily due to a non-recurring
compensation expense of approximately $340,000 associated with a warrant
exchange conducted in January 1997. To a lesser extent, the increase resulted
from additional selling and general expenses which included costs of preparing
collateral sales material, demonstrations of the Company's product in several,
dispersed geographic locations, increased legal and accounting fees resulting
from the Company's financing activities, and an allocated portion of overhead
expenses, such as rent, telephone and office supplies.
During second quarter 1997, the Company has hired additional personnel
to expand the Company's marketing and sales capabilities and anticipates that
it will continue to hire marketing and sales personnel in the near future.
Exclusive of the one-time non-cash compensation expense incurred during the
three months ended March 31, 1997, the Company expects general and
administrative expenses to increase in future periods as the Company incurs
additional costs related to being a publicly-traded company and expands its
staff and facilities.
Research and development expenses increased by approximately $173,000,
or 60%, for the three months ended March 31, 1997, to approximately $460,000
from approximately $287,000 for the period ended March 31, 1996. The increase
in research and development
<PAGE> 9
expenses was due primarily to the hiring of additional technical staff and
increased use of subcontractors in the development of components of the
Company's VidPhone(R) system. Research and development expenses include the
costs associated with all personnel, materials and contract personnel engaged in
research and development for the Company, as well as an allocated portion of
overhead expenses, such as rent, telephone and office supplies.
The Company intends to accelerate and expand research and development
by hiring additional technical staff and purchasing additional research and
development related material. As the Company continues testing and
demonstrating its product line, the Company expects research and development
expenses to increase.
Interest expense increased by approximately $207,000 for the three
months ended March 31, 1997, to approximately $210,000 from approximately
$3,000 for the period ended March 31, 1996. The increase in interest expense
was due primarily to a non-cash amortization of debt discounts representing the
fair value of warrants issued to holders of bridge notes issued in connection
with the private placement of warrants and debt in October and November 1996.
As a result of the foregoing factors, net loss for the three months
ended March 31, 1997 increased by approximately $862,000, or 149%, to
approximately $1,442,000 from approximately $580,000 for the three months ended
March 31, 1996.
LIQUIDITY AND CAPITAL RESOURCES
The Company has incurred cumulative losses aggregating approximately
$6.6 million from inception through March 31, 1997. The Company expects to
incur additional operating losses for the foreseeable future, principally as a
result of expenses associated with the Company's product development efforts
and anticipated sales, marketing and general and administrative expenses.
During the three months ended March 31, 1997, the Company satisfied its cash
requirements principally from private sales of equity and debt securities. The
primary uses of cash have been to fund research and development and sales,
general and administrative expenses.
At March 31, 1997, the Company had cash of approximately $239,000 and
a working capital deficit of approximately $1.6 million. In April 1997, the
Company received net proceeds of approximately $7.8 million from the
Offering (including proceeds received from the exercise in full of the
underwriter's over-allotment option). Approximately $2.1 million of the gross
proceeds were used to repay the promissory notes issued in the Bridge Financing
and $521,000 of the net proceeds of the Offering were used to retire other
outstanding indebtedness.
Net cash used in operating activities for the three months ended March
31, 1997 totaled approximately $1.2 million. Net cash used in investing
activities for the three months ended March 31, 1997 totaled approximately
$192,000. Net cash provided by financing for the three months ended March 31,
1997 totaled approximately $960,000.
<PAGE> 10
Based on the Company's operating plan, the Company believes that the
net proceeds of the Offering, together with anticipated revenues for future
operations, will be sufficient to satisfy its capital requirements and finance
its operations for the foreseeable future. Such belief is based on certain
assumptions and there can be no assurance that such assumptions are correct.
The Company may be required to raise substantial additional capital in the
future in order to carry out its business plan. In addition, contingencies may
arise which may require the Company to obtain additional capital. Accordingly,
there can be no assurance that such resources will be sufficient to satisfy the
Company's capital requirements. The Company anticipates that any additional
financing required to meet its current plans for expansion may take the form of
the issuance of common or preferred stock or debt securities, or may involve
other secured or unsecured debt financing. Additional equity financing may
involve substantial dilution to the interests of the Company's then existing
stockholders. To the extent that the Company elects to obtain debt financing,
the lender may impose certain restrictive covenants on the Company and upon any
default by the Company on such debt financing, and in a liquidation of the
Company, the rights of such lender would be superior to the rights of the
holders of Common Stock. There can be no assurance that the Company will be
able to obtain such additional capital on a timely basis, on favorable terms,
or at all. In any of such events, the Company may be unable to implement its
business plan.
Part II - Other Information
Item 2. Changes in Securities
(c) The information required by Item 701 of Regulation S-B as to all equity
securities sold by the registrant during the quarter ended March 31,
1997 is incorporated herein by reference to Part II, page II-5, of the
Registrant's Registration Statement on Form SB-2 (File No. 333-20625)
filed with the Securities and Exchange Commission under the Securities
Act of 1933, as amended.
Item 4. Submission of Matters to a Vote of Security Holders.
(c) Pursuant to Section 228(a) of the General Corporation Law of the State of
Delaware ("DGCL"), by Written Consent in Lieu of a Special Meeting of the
Stockholders dated March 14, 1997, the holders of a majority of the
outstanding shares of Common Stock of the Registrant voted to authorize
the 1996 Stock Incentive Plan adopted by the Board of Directors of the
Registrant and submitted to the stockholders of the Registrant for
approval on January 16, 1996, pursuant to which stock options and other
performance-based awards may be granted to officers, directors, key
employees and consultants to promote the long-term growth of the
Registrant. Of the 2,561,844 shares of common stock outstanding and
eligible to vote on March 14, 1997, 1,757,243 shares were voted for
authorization of the 1996 Stock Incentive Plan. The remaining
stockholders were given proper notice of the majority stockholder action
as required by Section 228(d) of the DGCL.
Item 6. Exhibits and Reports on Form 8-K
<PAGE> 11
(a) Exhibits
3.1 Amended and Restated Certificate of Incorporation (Incorporated by
reference to Exhibit No. 3.1 forming a part of the Registrant's
Registration Statement on Form SB-2 (File No. 333-20625) filed with the
Securities and Exchange Commission under the Securities Act of 1933, as
amended).
3.2 Amended and Restated Bylaws (Incorporated by reference to Exhibit 3.2
forming a part of Amendment No. 2 to the Registrant's Registration
Statement on Form SB-2 (File No. 333-20625) filed with the Securities
and Exchange Commission under the Securities Act of 1933).
4.1 Form of Warrant for the Purchase of Shares of Common Stock, issued in
connection with the private placement of $2,000,000 aggregate principal
amount of Bridge Notes (Incorporated by reference to Exhibit 3.4
forming a part of the Registrant's Registration Statement on Form SB-2
(File No. 333-20625) filed with the Securities and Exchange Commission
under the Securities Act of 1933).
4.2 Form of Warrant to Purchase Common Stock of the Registrant, issued in
connection with the private placement units in June 1995 and August
1996. (Incorporated by reference to Exhibit 3.5 forming a part of the
Registrant's Registration Statement on Form SB-2 (File No. 333-20625)
filed with the Securities and Exchange Commission under the Securities
Act of 1933, as amended).
4.3 Warrant to Purchase 43,382 Shares of Common Stock, issued to the
Adelson Investment Company (Incorporated by reference to Exhibit 3.6
forming a part of the Registrant's Registration Statement on Form SB-2
(File No. 333-20625) filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended).
4.4 Form of Warrants for the Purchase of 100,000 Shares of Common Stock,
$.01 par value per share, issued in connection with the private
placement of Series A Convertible Preferred Stock and warrants in
December 1996 and January 1997 (Incorporated by reference to Exhibit
3.7 forming a part of the Registrant's Registration Statement on Form
SB-2 (File No. 333-20625) filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended).
4.5 Form of Option for the Purchase of 180,000 shares of Common Stock
issued to Barington Capital Group, L.P. (Incorporated by reference to
Exhibit 3.8 forming a part of the Registrant's Registration Statement
on Form SB-2 (File No. 333-20625) filed with the Securities and
Exchange Commission under the Securities Act of 1933, as amended).
4.6 Specimen certificate evidencing shares of Common Stock of the Registrant
(Incorporated by reference to Exhibit 4.2 forming a part of Amendment
No. 2 to the Registrant's Registration Statement on Form SB-2 (File No.
333-20625) filed with the Securities and Exchange Commission under the
Securities Act of 1933).
<PAGE> 12
10.1 1994 Stock Option Plan (Incorporated by reference to Exhibit 10.1
forming a part of the Registrant's Registration Statement on Form SB-2
(File No. 333-20625) filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended).
10.2 1996 Stock Incentive Plan (Incorporated by reference to Exhibit No.
10.2 forming a part of the Registrant's Registration Statement on Form
SB-2 (File No. 333-20625) filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended).
10.3 Employment Agreement between the Registrant and Steven A. Rogers
(Incorporated by reference to Exhibit No. 10.3 forming a part of
Amendment No. 2 to the Registrant's Registration Statement on Form SB-2
(File No. 333-20625) filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended).
10.4 Form of Consulting Agreement by and between the Registrant and
Barington Capital Group, L.P. (Incorporated by reference to Exhibit No.
10.4 forming a part of the Registrant's Registration Statement on Form
SB-2 (File No. 333-20625) filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended).
10.5 Letter Agreement, dated October 7, 1996, between Barington Capital Group
and the Registrant (Incorporated by reference to Exhibit No. 10.5
forming a part of Amendment No. 2 to the Registrant's Registration
Statement on Form SB-2 (File No. 333-20625) filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended).
10.6 Letter Agreement, dated December 5, 1995, by and among PVR Securities,
Inc., the Registrant, Steven A. Rogers and John B. Torkelsen
(Incorporated by reference to Exhibit No. 10.6 forming a part of
Amendment No. 2 to the Registrant's Registration Statement on Form SB-2
(File No. 333-20625) filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended).
10.7 Voting Agreement, dated December 19, 1996, by and among the Registrant,
Steven A. Rogers, Applewood Associates, L.P. and Acorn Technology
Partners, L.P. (Incorporated by reference to Exhibit No. 10.7 forming a
part of Amendment No. 2 to the Registrant's Registration Statement on
Form SB-2 (File No. 333-20625) filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended).
27.1 Financial Data Schedule.
(b) The Registrant did not file any reports on Form 8-K during the quarter
ended March 31, 1997.
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Objective Communications, Inc.
By: /s/ STEVEN A. ROGERS
------------------------------------------
Steven A. Rogers
President and Chief Executive Officer
(duly authorized executive officer)
/s/ ROBERT H. EMERY
------------------------------------------
Robert H. Emery
Vice President, Administration and Finance
(principal financial officer)
May 19, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 238,786
<SECURITIES> 0
<RECEIVABLES> 35,723
<ALLOWANCES> 0
<INVENTORY> 471,358
<CURRENT-ASSETS> 1,109,990
<PP&E> 561,666
<DEPRECIATION> 205,697
<TOTAL-ASSETS> 1,662,094
<CURRENT-LIABILITIES> 2,759,155
<BONDS> 44,709
1,810,643
0
<COMMON> 20,619
<OTHER-SE> (2,973,032)
<TOTAL-LIABILITY-AND-EQUITY> 1,662,094
<SALES> 0
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<INCOME-TAX> (1,442,045)
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</TABLE>
