<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 10-QSB/A
(AMENDMENT NO. 1)
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
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[ ] 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
000-25313
AGEMARK CORPORATION
(Exact name of small business issuer as specified in its charter)
NEVADA 94-32701689
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2614 Telegraph Avenue, Berkeley, California 94704
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (510) 548-6600
-----------------------------
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
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 X 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 latest practicable date: The number of shares of Common
Stock, $.001 par value per share, outstanding on May 17, 1999, was 1,000,000.
Transitional Small Business Disclosure Format (check one): Yes No X
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TABLE OF CONTENTS
Page
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PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements............................................... 2
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K................................... 8
SIGNATURES ............................................................... 9
Exhibit Index............................................................... 10
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PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
AGEMARK CORPORATION
BALANCE SHEET
March 31, 1999
(In thousands except share data)
(Unaudited)
A S S E T S
Cash and cash equivalents $ 758
Property and equipment, net 21,375
Deferred tax assets 445
Loan costs 61
Other assets 259
-----------------
Total assets $ 22,898
=================
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable and accrued liabilities $ 2,188
Notes payable 15,043
-----------------
Total liabilities $ 17,231
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STOCKHOLDERS' EQUITY
Common stock, stated value $.001, 20,000,000 shares
authorized, 1,000,000 shares issued and outstanding $ 1
Additional paid in capital 5,856
Accumulated deficit (190)
-----------------
Total stockholders' equity $ 5,667
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Total liabilities and stockholders' equity $ 22,898
=================
See accompanying notes to financial statements.
2
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AGEMARK CORPORATION
STATEMENT OF OPERATIONS
(In thousands except share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
-------------------------- -------------------------
1999 1998 1999 1998
------------ ----------- ----------- ------------
<S> <C> <C> <C> <C>
Revenue
Property gross revenue $ 2,441 $ 306 $ 4,813 $ 306
Other income 23 - 42 -
------------ ----------- ----------- ------------
Total revenue $ 2,464 $ 306 $ 4,855 $ 306
------------ ----------- ----------- ------------
Expenses
Property operating expenses $ 1,983 $ 245 $ 3,987 $ 245
Administrative and overhead expenses 232 411 -
Interest expense 226 77 459 77
Depreciation 154 32 307 32
------------ ----------- ----------- ------------
Total expenses $ 2,595 $ 354 $ 5,164 $ 354
------------ ----------- ----------- ------------
Net loss $ (131) $ (48) $ (309) $ (48)
============ =========== =========== ============
Basic loss per common share $ (0.13) $ (240.00) $ (0.31) $ (240.00)
============ =========== =========== ============
</TABLE>
See accompanying notes to financial statements.
3
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AGEMARK CORPORATION
STATEMENT OF STOCKHOLDERS' EQUITY
Six Months Ended March 31, 1999
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Additional Retained
Common Paid-In Earnings
Stock Capital (Deficit) Total
----- ------- --------- -----
<S> <C> <C> <C> <C>
Balance, September 30, 1998 $ 1 $ 5,856 $ 119 $ 5,976
Net loss (309) (309)
------------- ------------- ------------- -------------
Balance, March 31, 1999 $ 1 $ 5,856 $ (190) $ 5,667
============= ============= ============= =============
</TABLE>
See accompanying notes to financial statements.
4
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AGEMARK CORPORATION
STATEMENT OF CASH FLOWS
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
March 31,
---------------------------
1999 1998
---------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (309) $ (48)
Adjustments to reconcile net loss to net cash provided by operating
activities:
Depreciation 307 32
Change in assets and liabilities:
Decrease (increase) in other assets 109 (9)
Increase (decrease)in accounts payable and accrued liabilities (54) 10
--------------- ------------
Net cash provided by (used in) operating activities $ 53 $ (15)
--------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment $ (184) $ (1)
--------------- ------------
Net cash used in investing activities $ (184) $ (1)
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CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on notes payable $ (529) $ -
New loan costs paid (51) -
--------------- ------------
Net cash used in financing activities $ (580) $ 0
--------------- ------------
Net decrease in cash and cash equivalents $ (711) (16)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,469 26
--------------- ------------
Cash and cash equivalents, end of period $ 758 10
=============== ============
SUPPLEMENTAL DISCLOSURES
Cash payments for:
Interest $ 168 77
=============== ===========
Taxes $ 0 0
=============================
</TABLE>
See accompanying notes to financial statements.
5
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AGEMARK CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1. Basis of Presentation
The interim financial statements included herein have been prepared by
the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations,
although the Company believes that the disclosures are adequate to
make the information presented not misleading.
These statements reflect all adjustments, consisting of normal
recurring adjustments which, in the opinion of management, are
necessary for fair presentation of the information contained therein.
It is suggested that these interim financial statements be read in
conjunction with the financial statements and notes thereto included
in the Company's registration statement on Form 10-SB for the year
ended September 30, 1998. The Company follows the same accounting
policies in preparation of interim reports.
Note 2. Transactions With Affiliates
The Company contracts with Evergreen Management, Inc. ("EMI") for the
management of its owned and operated properties. EMI is co-owned by
Richard J. Westin and Jesse A. Pittore, directors and officers of the
Company. Compensation for these management services is 4.5% of gross
income paid monthly. For the three and six months ended March 31,
1999, management fees of $109,845 and $217,212, respectively, are
included in the property operating expenses on the statement of
operations for services provided by EMI. At March 31, 1999, accounts
payable includes $41,964 owed by the Company to EMI.
For the three and six months ended March 31, 1999, the Company paid
rent for the Company's headquarters in Berkeley, California in the
amount of $6,000 and $12,000, respectively, pursuant to a lease
between the Company and the Waterford Company, which is owned by
members of Richard J. Westin's family. The lease is for a one-year
term starting October 1, 1998 at a rent of $2,000 per month. The lease
will automatically renew unless terminated by either party. The lessee
is responsible for limited maintenance and repair expenses and all
utilities. The Waterford Company is responsible for major repairs,
real estate taxes and debt service.
6
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AGEMARK CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 3. Employee Stock Incentive Plan
In December, 1998 the stockholders approved the adoption of the 1997
Employee Stock Incentive Plan, a stock option plan for certain
employees and directors. The total number of shares that may be issued
upon the exercise of options under this plan is 250,000. Also under
this plan, no participant may be granted more than 100,000 shares and
no awards may be granted after November 21, 2007.
Effective January 1, 1999, options to purchase up to a total of
210,416 shares of common stock were granted at exercise prices ranging
from $1.00 to $1.10 per share to the officers, directors and employees
of the Company. The options will vest as follows:
Exercise Date
Share Price Fully
Granted Per Share Vested
------- --------- ------
166,666 $1.10 July 1, 1999
1,000 1.00 January 1, 2000
42,750 1.00 January 1, 2003
Effective April 1, 1999, options to purchase up to a total of 18,748
shares of common stock were granted at an exercise price of $1.00 per
share to other employees of the Company. These options become fully
vested on April 1, 2001.
The Board of Directors of the Company determined at the time of grants
that the estimated fair market value of the Company's common stock was
$1.00 per share based on the following considerations: there was no
public market for the stock; the Company and the contributing
Partnerships had no operating profit history; the Plan of
Reorganization prohibits the Company from declaring any dividends on
its common stock until certain notes payable assumed pursuant to the
Plan of Reorganization are paid in full or otherwise satisfied; a
significant portion of the Company's cash flow for at least the near
term is expected to be devoted to debt service; and transactions
affecting 50,000 shares had been effected at that time between the
former general partner of the contributing Partnerships and certain
limited partners where the limited partnership interests were
purchased by the general partner at an equivalent value of
approximately $1.00 per share.
The Company believes that the stock option grants are not compensatory
and that therefore they do not have a dilutive effect on the
calculation of earnings per share.
7
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PART II
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
--------
Exhibit No. Description
----------- -----------
27 Financial Data Schedule
(b) Reports on Form 8-K. The Registrant filed no reports on Form 8-K during
the quarter ended March 31, 1999.
8
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this amended report to be signed on its behalf by the
undersigned thereunto duly authorized.
AGEMARK CORPORATION
February 11, 2000 /s/ RICHARD J. WESTIN
--------------------------------------------
Richard J. Westin,
Chief Executive Officer
February 11, 2000 /s/ JAMES P. TOLLEY
---------------------------------------------
James P. Tolley,
Chief Financial Officer and
Chief Accounting Officer
9
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EXHIBIT INDEX
TO QUARTERLY REPORT ON FORM 10-QSB/A
FOR AGEMARK CORPORATION
Exhibit No. Exhibit Description
- ----------- -------------------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEETS AND INCOME STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> MAR-31-1999
<CASH> 758
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 758
<PP&E> 21950
<DEPRECIATION> 575
<TOTAL-ASSETS> 22898
<CURRENT-LIABILITIES> 2188
<BONDS> 0
<COMMON> 1
0
0
<OTHER-SE> 5666
<TOTAL-LIABILITY-AND-EQUITY> 22898
<SALES> 4813
<TOTAL-REVENUES> 4855
<CGS> 0
<TOTAL-COSTS> 5164
<OTHER-EXPENSES> 411
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 459
<INCOME-PRETAX> (309)
<INCOME-TAX> 0
<INCOME-CONTINUING> (309)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (309)
<EPS-BASIC> (.31)
<EPS-DILUTED> 0
</TABLE>
