10Q is out - it Ain't pretty
Some excerpts:
Total loss for last 3 months thru 9/30/99 ---- $5.4 Million
Yes that is for 3 months for 9 months the loss was $7.7 million
In August 1999, the Company entered into two arrangements to receive investor relations consulting services in return for the issuance of an aggregate of 258,000 shares of common stock. The Company recorded an expense of $1,290,000 for the value of shares issued for the consulting services received.
The Company received notice from Infinite Graphics Incorporated, dated November 12, 1999, regarding (1) the termination of the license agreement for the IGI CAD/CAM software it licensed from IGI pursuant to the License and Asset Purchase Agreement between the Company and IGI dated February 27, 1998 (the "IGI Agreement") and (2) the transfer back to IGI of the related assets the Company purchased from IGI pursuant to the IGI Agreement (the "Transferred Assets"). IGI's right to terminate the license agreement and to reclaim the Transferred Assets arose due to the Company's inability to pay the earn-out payment due to IGI pursuant to the Purchase Agreement. The amount of this payment was approximately $1,864,000 and was due in June 1999. The termination of the license and the reversion of the assets, according to the claim is to be effective as of December 12, 1999. IGI claims that the Company still must pay IGI all or a portion of the earn out payment. The Company intends to dispute this claim vigorously.
Presently, the Company believes its negative working capital can be improved from the sale of a business unit.
The terms of the renegotiation with H&Q call for the Company to significantly reduce the notes payable outstanding with H&Q with revenue from sales and from proceeds from additional equity, debt or asset sales. If the Company is not in default in its debt agreements with H&Q, the prepayments can be re-borrowed according to the standard terms of the borrowing base agreement.
The Company received notice from BHT asserting that the Company has defaulted on a $1,600,000 payment obligation set forth in the Agreement and Plan of Merger by and among the Company, Global MAINTECH, Inc., BHT Acquisition, Inc. and BHT, dated March 5, 1999. The Company believes BHT's assertion is in error.
The Company undertook a restructuring plan in October 1999 to reduce costs, primarily with respect to its VCC operations. The restructuring plan resulted in the layoff of approximately 20 employees, the reduction of salaries through December 31, 1999. The Company believes that the restructuring plan will significantly reduce its operating costs and allow it to meet its scheduled debt obligations for the foreseeable future.
Some men fiddle while Rome burns others just continue to shop......till they drop !!!!!!!!! |
