<PAGE>
U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to ________________
Commission File Number: 1-11883
EMB CORPORATION
---------------
(Name of small business issuer as
specified in its charter)
Hawaii 95-3811580
------------------------------------ -------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3200 Bristol Street, Eighth Floor, Costa Mesa, California 92626
---------------------------------------------------------------
(Address of principal executive offices)
(714) 437-0738
----------------------
(Issuer's telephone number)
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 _____
----
Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by court. Yes ____ No _____
Applicable only to Corporate Issuers
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the last practicable date: 29,949,928 as of May 15, 2000.
Transitional Small Business Disclosure Format (Check One): Yes ____ No X
-----
<PAGE>
PART - FINANCIAL INFORMATION
EMB CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
As of March 31, 2000
<TABLE>
ASSETS
<S> <C>
Current assets:
Cash $ 38,218
Restricted cash 37,116
Other current assets 81,218
------------
Total current assets 156,552
Property and equipment, net 36,021
Land held for sale 43,000
Goodwill 3,616,304
Other assets 163,141
------------
$ 4,015,018
============
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accounts payable and accrued liabilities $ 977,838
Note payable to related party 1,998,036
Net liabilities of discontinued operations 5,001,445
Notes payable 695,150
------------
Total current liabilities 8,672,469
Convertible notes payable 1,700,000
------------
Total liabilities 10,372,469
------------
Commitments and contingencies
Shareholders' deficit:
Common stock 22,614,219
Accumulated deficit (28,971,670)
------------
Total shareholders' deficit (6,357,451)
------------
$ 4,015,018
============
</TABLE>
<PAGE>
EMB CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Six Months Ended March 31, 2000 and 1999
<TABLE>
<CAPTION>
Three Months Six Months
----------------------------- -----------------------------
2000 1999 2000 1999
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
General and administrative expenses $ 156,526 $ 184,207 $ 326,420 $ 518,038
Interest expense 51,251 32,905 134,034 99,653
----------- ----------- ----------- ------------
Loss before income taxes (207,777) (217,112) (460,454) (617,691)
Provision for income taxes - - 800 800
----------- ----------- ----------- ------------
Loss from continuing operations (207,777) (217,112) (461,254) (618,491)
Loss from discontinued operations (504,687) (3,245,564) (1,464,152) $ (4,376,686)
----------- ----------- ----------- ------------
Net loss $ (712,464) $(3,462,676) $(1,925,406) $ (4,995,177)
=========== =========== =========== ============
Basic and diluted loss per common share:
Continuing operations $ (0.01) $ (0.01) $ (0.02) $ (0.05)
=========== =========== =========== ============
Discontinued operations (0.02) (0.21) (0.05) (0.33)
=========== =========== =========== ============
Net loss $ (0.02) $ (0.22) $ (0.07) $ (0.37)
=========== =========== =========== ============
Basic and diluted weighted average shares 29,486,201 15,595,172 28,486,201 13,351,431
=========== =========== =========== ============
</TABLE>
<PAGE>
EMB CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASHFLOWS
For the Six Months Ended March 31, 2000 and 1999
<TABLE>
<CAPTION>
2000 1999
----------- ------------
<S> <C> <C>
Cash flows from operating activities:
Net loss $(1,925,406) $ (4,995,177)
Adjustments to reconcile net loss to net cash
Provided by (used) in operating activities:
Common stock issued for services 853,500 1,677,998
Amortization of common stock issued for debt financings - 105,500
Provision for write off of goodwill and ICI severance agreement - 828,211
Write off for impairment of fixed assets - 500,000
Depreciation and amortization 357,395 147,331
Changes in operating assets and liabilities:
Accounts receivable (23,727) 13,010
Mortgage loans held for sale (1,500) 12,677,178
Other current assets (59,525) (125,766)
Accounts payable and accrued liabilities (21,925) 1,082,707
Payroll taxes payable 233,893 619,148
Other current liabilities (9,076) (279,630)
----------- ------------
Net cash provided by (used) in operating activities (596,371) 12,250,510
----------- ------------
Cash flows from investing activities:
Purchases of property and equipment (5,200) (61,671)
Cash received from acquisitions 302 -
Decreases in other assets 30,716 50,851
----------- ------------
Net cash provided by (used in) investing activities 25,818 (10,820)
----------- ------------
Cash flows from financing activities:
Borrowings (repayments) on warehouse line of credit, net - (12,716,722)
Payments under capital lease obligations (152,908) (223,363)
Proceeds from related party borrowings 883,581 97,643
Proceeds from (payments) of convertible and other notes payable (110,339) 577,791
----------- ------------
Net cash provided by (used in) financing activities 620,334 (12,264,651)
----------- ------------
Net (decrease) increase in cash 49,781 (24,961)
Cash at beginning of period 47,801 24,961
----------- ------------
Cash at end of period $ 97,582 $ -
=========== ============
</TABLE>
<PAGE>
NOTE 1 - BASIS OF PRESENTATION
Unaudited Interim Financial Statements
The accompanying financial statements are unaudited and are prepared in
accordance with rules and regulations of the Securities and Exchange Commission
for interim quarterly reporting. Accordingly, these financial statements do not
include all disclosures required under generally accepted accounting principles.
In the opinion of management, the accompanying consolidated financial statements
contain all adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position of EMB Corporation and
subsidiaries as of March 31, 2000, and the results of their operations and their
cash flows for the three and six months ended March 31, 2000 and 1999,
respectively. These consolidated financial statements include the accounts of
EMB Corporation and its subsidiary companies (together "the Company"). Results
for the six months ended March 31, 2000, are not necessarily indicative of the
operations which may occur during the year ending September 30, 2000. Refer to
the Company's Annual Report on Form 10-KSB for the year ended September 30,1999
for further information.
Going Concern
Through March 31, 2000, the Company has incurred significant losses. At March
31, 2000, the Company had a working capital deficit of $8.5 million, which
included approximately a $3.5 million liability to federal and state agencies
for employee and employer payroll taxes. The Company dramatically reduced its
operations on or about December 22, 1998, to significantly reduce the losses
from operations. The Company has been relatively inactive in fiscal 1999 and
discontinued their mortgage operations in the beginning of fiscal 2000.
Management is currently funding its operations through loans from affiliates
and/or officers. The Company requires immediate proceeds from a financing or
from the sale of its land to meet its current obligations. Management is seeking
private equity and debt capital, as well as seeking to find a buyer for its land
in Monterey, California. There are no assurances that proceeds from the sources
discussed above will be available on acceptable terms or available at all. These
factors raise substantial doubt about the Company's ability to continue as a
going concern. The accompanying consolidated financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Certain prior period amounts have been reclassified to conform to current period
presentation. These reclassifications have no effect on previously reported net
losses.
Information in this report should be read in conjunction with the Company's
consolidated financial statements as stated in its reports on Form 10-KSB for
the fiscal years ended September 30, 1999, and September 30, 1998. The
accompanying consolidated financial information is not necessarily indicative of
the results for the year ended September 30, 2000.
NOTE 2 - LOSS PER COMMON SHARE
Basic and diluted loss per common share is based on the weighted average number
of common shares outstanding during the period. Outstanding options and warrants
have not been included in the calculation of the weighted average shares
outstanding since their effects are anti-dilutive.
NOTE 3 - SHAREHOLDERS' DEFICIT
During the three month period ended March 31, 2000 the Company issued 500,000
shares of common stock valued at $160,000 to certain consultants and advisors
for services provided. Services rendered to the Company consisted of strategic
advisory services, divestiture and other general business advisory services.
<PAGE>
On February 14, 2000, the Company acquired all the issued and outstanding stock
of Titus Real Estate Corp. ("Titus Real Estate") in exchange for 100,000 shares
of the Company's common stock fairly valued at $110,500. The agreement was
accounted for under the purchase method with the excess of cost over the fair
value of the net assets acquired of $505,327 allocated to goodwill. The Company
will amortize the goodwill over a seven-year period. Titus Real Estate owns a
combination of non-operated working and royalty interests in 71 producing oil
and gas wells located in the State of Oklahoma.
During the second quarter the holders of A Preferred elected to convert the
balance of 13,514 shares of A Preferred into 68,499 shares of common stock.
Additionally, in the second quarter the holders of B Preferred elected to
convert the balance of 97,500 shares of B Preferred into 540,674 shares of
common stock.
As of May 15, 2000 (Unaudited) the Company had 29,949,928 shares of common stock
issued and outstanding. The Company has outstanding dilutive securities which,
upon conversion and/or exercise, will exceed the authorized shares of common
stock of the Company. The Company requires shareholder approval to increase the
number of shares outstanding.
NOTE 4 - DISCONTINUED OPERATIONS
The operating results of the discontinued mortgage banking operations are
summarized as follows:
<TABLE>
<CAPTION>
Three Months Ended March 31, Six Months Ended March 31,
---------------------------------------- --------------------------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues $ 1,400,670 $ 1,172,778 $ 2,775,169 $ 4,666,768
Operating expenses (1,984,205) (4,423,966) (4,348,521) (9,018,301)
Other income, net 78,848 5,624 109,200 (25,153)
----------- ----------- ----------- -----------
Net loss from discontinued
operations $ (504,687) $(3,245,564) $(1,464,152) $(4,376,686)
=========== =========== =========== ===========
</TABLE>
The net liabilities of discontinued operations are summarized as follows as of
March 31, 2000:
<TABLE>
<S> <C>
Cash $ 59,364
Current assets 360,352
Property and equipment, net 433,713
Land 800,000
Other assets 29,111
Current liabilities, excluding payroll liabilities (1,637,062)
Payroll liabilities (3,469,718)
Notes payable (1,577,205)
-----------
Net liabilities of discontinued operations $(5,001,445)
===========
</TABLE>
At March 31, 2000, the Company has unpaid federal and state payroll tax
liabilities of approximately $3.5 million, including estimated penalties and
interest. During fiscal 1999 and 1998, payroll tax deposits were not made
through the date the Company ceased operations of EMB Mortgage in 1999.
Penalties and interest continue to accrue into fiscal 2000. Certain officers may
be held personally liable in the event the Company does not satisfy these
obligations.
In connection with its mortgage banking activities, the Company was required to
repurchase loans, which failed within a specific time period or were funded
based on fraudulent information provided by the debtor and not detected by the
Company's underwriting policies and procedures. In connection with the
repurchase of these assets from the Company's mortgage warehouse lender, the
Company issued a note
<PAGE>
totaling $923,976. The non-interest bearing note was payable on August 15, 1999.
The note is currently in default and subject to a 5% late fee. The note is
secured by the land located in Monterey County, California.
NOTE 5 - SUBSEQUENT EVENT
On April 12, 2000, the Company entered into an Amended and Restated Purchase
Agreement with e-Net Financial.com Corp ("e-Net"). The Company agreed to sell to
e-Net all of the outstanding stock, currently held by the Company of American
Residential Funding, Inc. ("AMRES") among other interests. In addition, the
Company transferred to e-Net all of its rights to acquire Titus Asset Management
("Titus"), under an existing Letter of Intent between the Company and Titus. In
exchange, the Company received 7,500,000 shares of common stock of e-Net, cash
in the amount of $1,595,000 and a short-term promissory note in the amount of
$2,405,000. The Company will distribute the e-Net common stock received by the
Company as a result of this transaction to the Company's shareholders as a
dividend. The Company has set a record date of May 31, 2000 for this
distribution. The Company is currently assessing the final purchase price and is
obtaining an independent valuation for the e-Net common stock received. A gain
is expected to be recorded in the third quarter ending June 30, 2000 as a result
of the sale of AMRES. On May 17, 2000 the Company received a payment of
$1,400,000 toward the short-term promissory note receivable from e-Net.
Refer to the Company's Annual Report on Form 10-KSB for the year ended September
30, 1999, for additional events subsequent to September 30, 1999.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
GENERAL
In fiscal 1998, the Company expanded its mortgage banking operations
through its acquisitions of Investment Consultants, Inc. ("ICI") and Preferred
Holding Group, Inc. ("PHG"). In fiscal 1999, the Company ceased its mortgage
banking operations of EMB Mortgage Corporation and divested itself of ICI due to
an economic downturn in the mortgage banking industry. Later in fiscal 1999, the
Company re-commenced its mortgage banking operations through acquisitions of
AMRES and Residential Mortgage Corporation ("RMC"). Effective September 1999,
EMB Mortgage was no longer in operation.
At the time of its acquisition by the Company, AMRES operated four company-
owned offices and licensed 10 Net Branch offices, all of which were located in
Southern California. With respect to company-owned offices, AMRES pays all
operational expenses and retains all of the income generated from that office. A
Net Branch differs in that AMRES entered into an agreement with an independent,
third party mortgage or real estate broker, licensing it to use the AMRES name
and to operate an AMRES-branded branch. The owner-manager of the Net Branch pays
all expenses of the Net Branch, including a payment to AMRES of a pre-
established fee for each closed mortgage loan. All net income is retained by and
all net loss is borne by, the Net Branch owner-manager. The amount of the fee
paid to AMRES varies depending upon the loan type and amount. In addition, AMRES
receives various costs associated with the loans which are charged to the
borrower(s). As of March 31, 2000, AMRES had four Company owned offices located
in Southern California. In addition, it had approximately 80 Net Branch offices
which were located in Southern California, Hawaii, Arizona and Florida.
Mortgages originated by the Company, through AMRES were primarily brokered
to various mortgage lenders. On January 12, 2000, the Company entered into an
agreement with e-Net Financial.com Corporation ("e-Net"), whereby e-Net acquired
certain of the assets of the Company, including all of the outstanding stock of
AMRES, the primary operating subsidiary of the Company. This transaction, which
closed on April 12, 2000, resulted in the Company discontinuing all of its
mortgage banking operations.
Prior to its acquisition by the Company in May 1999, RMC had not actively
engaged in business for approximately one year. At that time the Company began
to reactivate warehouse line of credit and government approvals for RMC. With
its decision, in January 2000, to divest itself of its mortgage banking
operations, on February 22, 2000, the Company sold its interest in RMC to
another mortgage banking entity.
Upon completion of the sales of AMRES and RMC (see Note 5 to the Company's
Consolidated Financial Statements, above), the Company changed the focus of its
operations from a financial services company to a natural resources development
company, through development of possible oil and water reserves associated with
its real property located in Monterey County, California, and through
acquisitions of other properties, including interests in producing oil and gas
and/or water properties such as Titus Real Estate. Titus Real Estate owns a
combination of non-operated working and royalty interests in 71 producing oil
and gas wells located in the State of Oklahoma.
RESULTS OF OPERATIONS
Continuing Operations for the Three Months Ended March 31, 2000 Compared to the
Three Months Ended March 31, 1999.
General and Administrative Expenses
General and administrative expenses decreased to $156,526 during the three
months ended March 31, 2000
<PAGE>
from $184,207 during the same period in 1999, a decrease of $27,681 or 15%. This
decrease is principally attributed to decrease in expenses related to the
ceasing of operations of the Company's subsidiaries in fiscal 1999. The Company
continues to incur costs as a public company consisting of salaries, rents,
utilities, legal and professional services.
Interest Expense
Interest expense increased to $51,251 during the three-month period ended March
31, 2000 from $32,905 in 1999. Interest expense for both periods consisted of
accrued interest payable on the convertible debt and the note due to a related
party. The increase is attributed to the increase in the note payable to the
related party.
Discontinued Operations for the Three Months Ended March 31, 2000, Compared to
the Three Months Ended March 31, 1999.
Revenues
Mortgage loan revenues, net of commitment fees, increased by $227,892 or 19% to
$1,400,670 during the three-month period ended March 31, 2000 from $1,172,778 in
1999. Revenues were generated primarily from loan processing and resale of
mortgage loans. The increase in revenues was attributable to the Company
including the operations of AMRES during the three months ended March 31, 2000.
In fiscal 1999 AMRES had not been acquired by the Company until the third
quarter and EMB Mortgage had ceased the majority of its operations.
Loan Origination Costs
Loan origination costs increased to $1,061,742 during the three-month period
ended March 31, 2000 from $590,113 in 1999. This increase is attributable to the
Company including the operations of AMRES during the three months ended March
31, 2000. As of the second quarter of fiscal 1999 the Company had ceased the
majority of operations of EMB Mortgage.
General and Administrative Expenses
General and administrative expenses of the discontinued operations decreased to
$922,463 during the three-month period ended March 31, 2000 from $3,833,853 in
1999, a decrease of $2,911,390 or 76%. This decrease is principally attributable
to the ceasing of EMB Mortgage and a reduction in staff for the corporate
operations of the Company. Additionally, the Company issued common stock to
various individuals for finance related consulting services in fiscal 1999;
these services were charged to consulting expense.
Other Income and Expense
Other income and expense increased to $78,848 during the three-month period
ended March 31, 2000 from $5,624 in 1999. During fiscal 2000 the Company began
negotiating settlements for amounts owed to certain vendors. Some amounts have
been settled below the obligation, these differences have been recorded as other
income in fiscal 2000.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company's capital resources have historically been provided by cash from
financing activities, primarily from the sale of its preferred stock and
warrants, and through convertible debt instruments and warrants. Due to the
extended losses incurred by the Company, its cash was being depleted rapidly
from operations. At March 31, 2000, the Company had a working capital deficit of
$5.0 million. The Company reduced its operations on or about December 22, 1998
to significantly reduce the losses and cash flows from operations. The Company
began originating loans through its acquisition of AMRES in May 1999. Management
is currently funding its operations through loans from affiliates and/or
officers. No cash flows have been generated through the sale of common or
preferred stock, or convertible debt securities in fiscal 2000 and management
does not believe such capital will be available to them. Management currently
believes its sole source of repayment of its obligations will come from the sale
of its AMRES and RMC subsidiaries. There are no assurances that the balance of
the proceeds of the sale will be received. These factors raise substantial doubt
about the Company's ability to continue as a going concern. The accompanying
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
<PAGE>
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On or about November 17, 1998, the Company entered into a
Stipulated Judgment in the matter of Yamaichi International (America) Inc., vs.
------------------------------------------
EMB Corporation, USDC, Southern District of New York, Case No. 98-7152 (DLC).
- ----------------
The lawsuit arose out of the obligation of the Company to pay rent for its
branch corporate office in New York City. The total amount of the judgment was
$186,000. As of March 31, 2000, the Company has paid approximately $7,100 toward
the judgment.
On or about August 4, 1999, a judgment was entered against the
Company in the matter of Resource Bancshares Mortgage Group, Inc. vs. EMB
------------------------------------------------
Mortgage Corporation, Circuit Court for Palm Beach County, Florida, Case No. 99-
- --------------------
2106-AO. The amount of the judgment was $129,518.57, and arose out of a mortgage
loan which Resource Bancshares Mortgage Group, Inc. ("RBMG") had requested the
Company to repurchase due to underwriting deficiencies. The mortgage loan in
question had been underwritten by Republic Mortgage Insurance Company and/or
RMIC Corporation (collectively, "RMIC") pursuant to a contract underwriting
agreement by and between RMIC and the Company. This agreement provided for RMIC
to provide certain remedies, including indemnification, to the Company in the
event of the failure of the RMIC underwriters to underwrite the Company's
mortgage loans in accordance with investor guidelines. The effectiveness of the
indemnification provisions of the agreement is dependent upon the result of
negotiations between the Company and RMIC, as further discussed in the following
paragraph.
The Company and RMIC are currently engaged in litigation,
Republic Mortgage Insurance Corporation and RMIC Corporation vs. EMB Mortgage
- -----------------------------------------------------------------------------
Corporation, Forsyth County, North Carolina Superior Court, Civil Action No. 98
- -----------
CVS 11380 and a judgment was filed in favor of RMIC in April 1999, which has now
been fully satisfied by the Company. This lawsuit arises out of fees allegedly
owed RMIC by the Company for underwriting services provided by RMIC to the
Company in its Daytona Beach, Florida office. Management of the Company believes
that RMIC and/or Joseph K. Brick, former Vice President of the Company and
former manager of its Daytona Beach operations, may be liable to indemnify the
Company for the losses incurred by the Company in connection with the mortgage
loan which is the basis for the RBMG litigation and any other potential losses
involving loans underwritten by RMIC at the Daytona Beach office. The Company
and RMIC are currently engaged in settlement discussions which, the Management
of the Company believes, will result in RMIC assuming such liability.
The Company and Joseph K. Brick are currently engaged in
litigation, Joseph K. Brick vs. EMB Corporation, Circuit Court, Seventh Judicial
-----------------------------------
District, Volusia County, Florida, Case no. 99-30669 CICI. The Company has filed
a Motion to dismiss the complaint for failure to state a cause of action and for
lack of jurisdiction. If granted, the Company intends to initiate proceedings
against Mr. Brick and others in the State of California.
In September 1999, the Company entered into a Stipulation for
Judgment in the matter of Southern Pacific Thrift & Loan vs. EMB Corporation, et
------------------------------------------------------
al., Orange County, California Superior Court, Case no. 807620. The case arose
- ------------------
out of money due IMPAC Warehouse Lending Group, Inc., on a pledge account
towards the warehouse line of credit in favor of EMB Mortgage Corporation. The
agreement provides for payment by the Company to Southern Pacific Thrift & Loan
of the sum of $100,431.13. At present the Company has full satisfied this
judgment.
<PAGE>
During December 1998, the Company terminated the majority of its
then employees due to the ceasing of operation of EMB Mortgage. In most cases
the employees were not given their final wages upon termination. There have been
various claims made by these employees and the labor board has taken actions
against the Company. Amounts owed the former employees were accrued in a prior
period and periodic payments have been made to a substantial number of the
former employees.
The Company is not engaged in any other legal proceedings except
litigation in the ordinary course of its business. In the opinion of
management, the amount of ultimate liability with respect to those proceedings
will not be material to the Company's financial position or results of
operations.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of the security holders of the Company during
its fiscal quarter ended March 31, 2000.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
*Exhibits filed herewith. Other exhibits are incorporated by reference to
previous filings.
Exhibit 10.1 - Purchase Agreement, dated January 12, 2000, by and
between the Company and e-Net Financial
Corporation, which was filed with the Securities
and Exchange Commission on January 19, 2000 as an
exhibit to Form 8-K, is hereby incorporated by
this reference.
Exhibit 10.2 - Stock Purchase Agreement, dated May 7, 1999, by
and among the Company, Vincent Rinehart and AMRES
Holdings, LLC, which was filed with the Securities
and Exchange Commission on April 11, 2000 as an
exhibit to Form 8-K, is hereby incorporated by
this reference.
Exhibit 10.3 - Amended and Restated Purchase Agreement dated
April 12, 2000, by and between the Company and e-
Net Financial.Com Corporation, which was filed
with the Securities and Exchange Commission on
April 18, 2000 as an exhibit to Form 8-K, is
hereby incorporated by this reference.
Exhibit 27* - Financial Data Schedule
(b) Reports on Form 8-K.
On January 19, 2000, the Company filed a report on Form 8-K which
disclosed the Purchase Agreement, dated January 12, 2000, entered
into by and between the Company
<PAGE>
and e-Net Financial Corporation, whereby the Company agreed to
sell certain of its assets to e-Net Financial Corporation.
On April 11, 2000, the Company filed a report on Form 8-K which
disclosed the Stock Purchase Agreement, dated May 7, 1999,
entered into by and among the Company, Vincent Rinehart and AMRES
Holdings, LLC, whereby the Company agreed to purchase the stock
of American Residential Fundings, Inc.
On April 18, 2000, the Company filed a report on Form 8-K which
disclosed the Amended and Restated Purchase Agreement, dated
April 12, 2000, entered into by and between the Company and e-Net
Financial.Com Corporation, whereby the Company agreed to sell
certain of its assets to e-Net Financial.Com Corporation.
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
EMB CORPORATION
Date: May 19, 2000 By: /s/ James E. Shipley
-----------------------
James E. Shipley
Director, President, and Principal Financial
and Accounting Officer
Date: May 19, 2000 By: /s/ William V. Perry
-----------------------
William V. Perry
Director, Vice President,
and Secretary
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 38,218
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 156,552
<PP&E> 39,486
<DEPRECIATION> (3,465)
<TOTAL-ASSETS> 4,015,018
<CURRENT-LIABILITIES> 8,672,469
<BONDS> 1,700,000
0
0
<COMMON> 22,614,219
<OTHER-SE> (28,971,670)
<TOTAL-LIABILITY-AND-EQUITY> 4,015,018
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 134,034
<INCOME-PRETAX> (460,454)
<INCOME-TAX> 800
<INCOME-CONTINUING> (461,254)
<DISCONTINUED> (1,464,152)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,925,406)
<EPS-BASIC> (0.07)
<EPS-DILUTED> (0.07)
</TABLE>
