<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 February 28, 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 Buddy Young 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 1,059,804 shares of common stock, par
value $.01 per share, issued and outstanding as of February 28,
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>
FEBRUARY 28, 1997 (Unaudited)
- ------------------------------------------------------------------------
<S> <C>
ASSETS
CASH $ 759
ACCOUNTS RECEIVABLE 18,807
PROGRAM INVENTORY, Net 10,000
FURNITURE AND FIXTURES - Net of
accumulated depreciation of $3,914 172
OTHER ASSETS 5,805
---------
TOTAL ASSETS $ 35,543
---------
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Accounts payable and accrued expenses $ 14,445
Amounts due to related party 19,500
Deferred income 2,000
---------
Total liabilities 35,945
---------
SHAREHOLDERS' EQUITY:
Common stock (par value - $.001,
30,000,000 shares authorized,
1,059,804 issued and outstanding) 1,060
Contributed capital 171,981
Accumulated deficit (173,443)
---------
Total shareholders' equity (402)
---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 35,543
---------
</TABLE>
See accompanying note to financial statements.
4
<PAGE>
MAR VENTURES, INC.
<TABLE>
STATEMENTS OF OPERATIONS (Unaudited)
- ----------------------------------------------------------------------------
<CAPTION>
FOR THE THREE FOR THE SIX
MONTHS ENDED MONTHS ENDED
FEBRUARY 28, FEBRUARY 28,
1997 1997
<S> <C> <C>
REVENUES $ 1,500 $ 4,372
---------- --------
COST OF PROGRAMS AND DISTRIBUTION FEES 10,000 10,905
---------- --------
EXPENSES:
Consulting fees to majority shareholder 10,800 15,800
General and administrative 9,430 15,039
Depreciation 150 150
Professional fees 37,020 38,775
Rent 1,955 3,143
---------- --------
Total expenses 59,355 72,907
---------- --------
NET LOSS $ (67,855) $(79,440)
---------- --------
NET LOSS PER SHARE $ (.06) $ (.10)
---------- --------
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 1,059,804 759,902
---------- --------
</TABLE>
See accompanying note to financial statements.
5
<PAGE>
MAR VENTURES, INC.
<TABLE>
STATEMENT OF CASH FLOWS (Unaudited)
- ------------------------------------------------------------------------
<CAPTION>
FOR THE SIX
MONTHS ENDED
FEBRUARY 28,
1997
------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(79,440)
Adjustments to reconcile net loss to
net cash provided (used) by
operating activities:
Amortization of film costs 10,000
Depreciation 150
Common stock issued for services 37,038
Changes in operating assets and
liabilities:
Accounts receivable 7,193
Accounts payable and accrued expenses (19,095)
Other assets (1,605)
--------
Net cash used by operating activities (45,759)
--------
CASH FLOWS FROM FINANCING ACTIVITIES -
Borrowings from related party 19,500
--------
NET DECREASE IN CASH (26,259)
CASH, BEGINNING OF PERIOD 27,018
--------
CASH, END OF PERIOD $ 759
--------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid for interest $ -0-
Cash paid for income taxes $ 1,000
</TABLE>
During the three months ended February 28, 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 note to financial statements.
6
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1.
MAR VENTURES, INC.
NOTE TO THE FINANCIAL STATEMENTS
1. 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.
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.
Results of Operations
License revenue from the Company's library for the quarter
ended February 28, 1997, was $1,500. 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 February
28, 1997, was $67,855. The majority of the loss was incurred as
a result of the amortization of the existing film library and the
fees paid for legal, accounting, and other professional
consulting services.
Liquidity and Capital Resources
At February 28, 1997, the Company's cash and accounts
receivable were insufficient to insure the Company's continued
existence as a going concern. During the six months ended
February 28, 1997, the Company had a negative cash flow from
operating activities of $45,759. During the period ending
February 28, 1997, the Company borrowed $19,500 from its majority
shareholder to fund current operations. In addition, during the
8
<PAGE>
period ending February 28, 1997, Mr. Young, the Company's
principal shareholder and Chief Executive Officer, converted
$46,625 of debt owed him by the Company, into equity. Mr. Young
received 358,654 shares of common stock. The shares were issued
to Mr. Young at a conversion price 10% above the price quoted on
the NASD Bulletin Board system, on the day of the conversion. In
addition, the Company issued 221,150 shares for professional
services valued at $26,538.
Management expects to meet its current cash requirements
through license revenues, borrowings from a related party as
necessary, and the sale 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 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 February 28, 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: April 4, 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: April 4, 1997 /s/ Buddy Young
------------------------------
Buddy Young, Director
Dated: April 4, 1997 /s/ L. Stephen Albright
------------------------------
L. Stephen Albright, Director
Dated: April 4, 1997 /s/ Steven Katten
------------------------------
Steven Katten, Director
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> AUG-31-1997
<PERIOD-END> FEB-28-1997
<CASH> 759
<SECURITIES> 0
<RECEIVABLES> 18,807
<ALLOWANCES> 0
<INVENTORY> 10,000
<CURRENT-ASSETS> 29,566
<PP&E> 4,086
<DEPRECIATION> 3,914
<TOTAL-ASSETS> 35,543
<CURRENT-LIABILITIES> 35,945
<BONDS> 0
0
0
<COMMON> 1,060
<OTHER-SE> 171,981
<TOTAL-LIABILITY-AND-EQUITY> 35,543
<SALES> 4,372
<TOTAL-REVENUES> 4,372
<CGS> 10,905
<TOTAL-COSTS> 82,812
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (78,440)
<INCOME-TAX> 1,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (79,440)
<EPS-PRIMARY> (.10)
<EPS-DILUTED> 0
</TABLE>
