<PAGE>
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 May 31, 1997
/ / Transition Report under Section 13 or 15(d) of the
Securities Exchange Act of 1934 [No Fee Required] for the
transition period from ________ to __________
Commission File Number: 0-20879
MAR VENTURES, INC.
(Name of small business issuer in its charter)
Delaware 95-4580642
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17337 Ventura Boulevard, Suite 224
Encino, California 91316
Issuer's Telephone Number: (818) 784-0040
(Address and phone number of principal executive offices)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act during
the past 12 months (or 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 / /
The Registrant has 2,199,804 shares of common stock, par value
$.01 per share, issued and outstanding as of May 31, 1997.
<PAGE>
INDEX TO QUARTERLY REPORT
ON FORM 10-QSB
PART I FINANCIAL INFORMATION
Page
Item 1. Financial Information 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 2. Change in Securities 9
Item 3. Defaults upon Senior Securities 9
Item 4. Submission of Matters to a Vote
of Securities Holders 9
Item 5. Other Information 9
Item 6. Exhibits and Reports on Form 8-K 9
Signatures 10
2
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PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
(Financial Statements Commence on Following Page)
3
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MAR VENTURES, INC.
<TABLE>
BALANCE SHEET
<CAPTION>
MAY 31, 1997 (Unaudited)
________________________________________________________________________
<S> <C>
ASSETS
CASH $ 283,711
ACCOUNTS RECEIVABLE 17,852
PROGRAM INVENTORY, Net 10,000
OTHER ASSETS 5,805
TOTAL ASSETS $ 317,368
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Accounts payable and accrued expenses $ 12,325
Amounts due to related party 26,000
Deferred income 2,000
Total liabilities 40,325
SHAREHOLDERS' EQUITY:
Common stock (par value - $.001,
30,000,000 shares authorized,
2,199,804 issued and outstanding) 2,200
Contributed capital 455,841
Accumulated deficit (180,998)
Total shareholders' equity 277,043
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 317,368
</TABLE>
See accompanying notes to financial statements.
________________________________________________________________________
4
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MAR VENTURES, INC.
<TABLE>
STATEMENTS OF OPERATIONS (Unaudited)
________________________________________________________________________
<CAPTION>
FOR THE THREE FOR THE NINE
MONTHS ENDED MONTHS ENDED
MAY 31, MAY 31,
1997 1997
_____________ ____________
<S> <C> <C>
REVENUES $ 6,575 $ 10,947
COST OF PROGRAMS AND DISTRIBUTION FEES 1,150 12,055
EXPENSES:
Consulting fees to majority shareholder 15,800
General and administrative 7,230 22,269
Depreciation 172 322
Professional fees 2,395 41,170
Rent 3,185 6,326
Total expenses 12,982 85,887
NET LOSS $ (7,555) $ (86,995)
NET LOSS PER SHARE $ (.01) $ (.10)
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING 1,098,000 842,000
</TABLE>
See accompanying notes to financial statements.
________________________________________________________________________
5
<PAGE>
MAR VENTURES, INC.
<TABLE>
STATEMENT OF CASH FLOWS (Unaudited)
________________________________________________________________________
<CAPTION>
FOR THE NINE MONTHS ENDED
MAY 31, 1997
____________
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (86,995)
Adjustments to reconcile net loss to net cash
provided (used) by operating activities:
Amortization of film costs 10,000
Depreciation 322
Common stock used for services 37,038
Changes in operating assets and liabilities:
Accounts receivable 8,148
Accounts payable and accrued expenses (21,215)
Other assets (1,605)
Net cash used by operating activities (54,307)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings from related party 26,000
Sale of common stock 285,000
Net cash provided by financing activities 311,000
NET INCREASE IN CASH 256,693
CASH, BEGINNING OF PERIOD 27,018
CASH, END OF PERIOD $ 283,711
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid for interest $ -0-
Cash paid for income taxes $ 1,000
</TABLE>
During the nine months ended May 31, 1997, the Company exchanged 358,654
shares for amounts due to its principal shareholder and Chief Executive
Officer ($46,625). In addition, the Company issued 221,150 shares for
professional services valued at $26,538.
See accompanying notes to financial statements.
________________________________________________________________________
6
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1.
MAR VENTURES, INC.
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL
The accompanying Financial Statements have been prepared in
accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form
10-QSB and Regulation S-B. 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 (consisting only of normal
recurring adjustments) considered necessary for a fair presentation
have been included.
For further information refer to the Financial Statements and
footnotes included in the Registrant's Annual Report on Form 10-KSB
for the year ended August 31, 1996.
The Results of Operations for any interim period are not
necessarily indicative of the results to be expected for the full
fiscal year ended August 31, 1997.
Unclassified Balance Sheet - In accordance with the provisions of
SFAS No. 53, the Company has elected to present an unclassified
balance sheet.
Per share information - Net loss per share for the periods
presented is computed on the basis of the weighted average common
shares outstanding.
2. SALE OF COMMON STOCK
During the quarter ended May 31, 1997, the Company sold 1,140,000
shares of its common stock for $285,000.
On June 3, 1997, the Company entered into a Letter of Intent with
Pyr Energy, LLC ("Pyr") pursuant to which the Company has an option
to purchase the stock of Pyr or effect a merger or other
combination of the two companies. In connection with the Letter of
Intent, the Company made a short-term loan to Pyr in the amount of
$275,000.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
GENERAL
The Company was incorporated under the laws of the State of
Delaware on March 27, 1996, as a wholly owned subsidiary of Bexy
Communications, Inc. On April 16, 1996, the Company, pursuant to the
terms of an Asset Transfer and Assumption Agreement, acquired the assets
of Bexy totaling approximately $110,000, in exchange for 452,000 shares
of its common stock. The Company, also under the terms of the
agreement, assumed liabilities of approximately $84,000.
As part of a Plan of Reorganization adopted by the Bexy
shareholders at a special meeting on July 2, 1996, the 452,000 Mar
Venture shares were distributed to the stockholders of record of Bexy as
of July 2, 1996. Each Bexy stockholder received one share of Mar
Ventures for every four shares of Bexy, held on the record date.
During the quarter ended May 31, 1997 the Company raised $285,000,
through a private placement of its common stock. The Company sold
1,140,000 shares at $0.25 per share. In addition, the Company signed a
letter of intent, dated June 3, 1997, with Pyr Energy, LLC pursuant to
which Mar Ventures has been granted the option to either (I) acquire all
of the membership interests in Pyr or (ii) to effect a merger or other
combination of Mar Ventures (or a subsidiary corporation or other entity
controlled by Mar Ventures) and Pyr. In connection with the letter of
intent, Mar Ventures has made a short-term loan in the amount of
$275,000 to Pyr.
Pyr Energy, LLC , is an independent oil and gas company whose focus
is on exploration in the United States.
RESULTS OF OPERATIONS
License revenue from the Company's library for the quarter ended
May 31, 1997, was $6,575. The low revenue was mainly due to the
Company's existing film library having previously been licensed in most
major territories, and that no new programming was acquired by the
Company during this period. Management does not anticipate any future
significant increase in revenues from the licensing of the Company's
current film library.
The Company's net loss for the three months ending May 31, 1997,
was $7,555. The majority of the loss was incurred as a result of the
fees paid for legal, accounting, and other general and administrative
expenses incurred to maintain the minimal operations of the Company.
8
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
At May 31, 1997, the Company's cash and accounts receivable were
insufficient to insure the Company's continued existence as a going
concern. During the nine months ended May 31, 1997, the Company had a
negative cash flow from operating activities of $54,307. During the
period ending May 31, 1997, the Company borrowed $6,500 from its
majority shareholder to fund current operations. As stated above,
during the quarter ended May 31, 1997 the Company raised $285,000,
through a private placement of its common stock. The Company sold
1,140,000 shares at $0.25 per share.
Management expects to meet its current cash requirements through
license revenues, borrowings from a related party as necessary, and
additional sales of equity. Management has and will continue during the
next twelve months to meet with investment bankers and individual
investors who may be attracted to the Company's business plan.
THERE CAN BE NO ASSURANCES THAT THE RELATED PARTY WILL CONTINUE
TO ADVANCE FUNDS IN ORDER TO MEET THE COMPANY'S REQUIREMENTS, OR
THAT THE COMPANY WILL BE SUCCESSFUL IN SELLING ADDITIONAL EQUITY.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS The Company is not a party to
any 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
During the quarter ended May 31, 1997, no matters
were submitted to the Company's security holders.
ITEM 5. OTHER INFORMATION None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K None.
9
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act,
the registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
Mar Ventures, Inc.
Dated: July 1, 1997 By: /s/ Buddy Young
------------------------
Buddy Young,
President (principal
executive officer) and
Treasurer (principal
financial and accounting
officer)
In accordance with the Exchange Act, 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: July 1, 1997 /s/ Buddy Young
------------------------------
Buddy Young, Director
Dated: July 1, 1997 /s/ L. Stephen Albright
------------------------------
L. Stephen Albright, Director
Dated: July 1, 1997 /s/ Steven Katten
------------------------------
Steven Katten, Director
10
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> AUG-31-1997
<PERIOD-END> MAY-31-1997
<CASH> 283,711
<SECURITIES> 0
<RECEIVABLES> 17,852
<ALLOWANCES> 0
<INVENTORY> 10,000
<CURRENT-ASSETS> 311,563
<PP&E> 4,086
<DEPRECIATION> 4,086
<TOTAL-ASSETS> 317,368
<CURRENT-LIABILITIES> 40,325
<BONDS> 0
0
0
<COMMON> 2,200
<OTHER-SE> 455,841
<TOTAL-LIABILITY-AND-EQUITY> 317,368
<SALES> 10,947
<TOTAL-REVENUES> 10,947
<CGS> 12,055
<TOTAL-COSTS> 97,942
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (85,995)
<INCOME-TAX> 1,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (86,995)
<EPS-PRIMARY> (.10)
<EPS-DILUTED> 0
</TABLE>
