UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OF 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended April 30, 1997
Commission File Number 0-3825
Computer Transceiver Systems, Inc.
(Exact name of registrant as specified in its charter)
New York 22-1842747
(State of Incorporation) (I.R.S. Employer Identification Number)
Registrant's Telephone Number: (201) 473-4700
Indicate by check mark whether the registrant (1) has 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
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by court.
Yes X No
The number of shares outstanding of the registrant's Common Stock, par value
of $.001 per share, as of June, 10 1997 was 2,716,603.
<PAGE>
COMPUTER TRANSCEIVER SYSTEMS, INC.
FORM 10 - Q
April 30, 1997
INDEX
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets - April 30, 1997
and July 31, 1996 3
Statements of Discontinued Operations-
Three and Nine Months ended April 30, 1997
and January 31, 1996 4
Statements of Cash Flows-
Nine Months ended April 30, 1997
and April 30, 1996 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
II. Other Information
Item 6. Exhibits and Reports on Form 8-K 8
Signatures 9
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<TABLE>
PART I Financial Information
Item 1. Financial Statements
COMPUTER TRANSCEIVER SYSTEMS, INC.
Balance Sheets
<CAPTION>
April 30, 1997 July 31, 1996
(unaudited) (audited)
(note 2)
<S> <C> <C>
ASSETS
Current Assets:
Marketable Securities--
Vertex Industries $ 3,052 $ 3,052
-------------- -------------
Total Assets $ 3,052 $ 3,052
============== =============
Liabilities and Stockholders' Equity
Commitments and Contingencies
Stockholders' Equity (Deficit)
Common stock, par value $.001
per share authorized
15,000,000 shares; issued and
outstanding 2,716,603 shares
at April 30, 1997 and at July
31, 1996, respectively
2,716 2,716
Capital in excess of par value 2,452,840 2,452,840
Accumulated deficit (2,450,156) (2,450,156)
Net unrealized loss on Marketable Securities (2,348) (2,348)
----------- -----------
Total Stockholders' Equity 3,052 3,052
----------- -----------
Total Liabilities and Stockholder' Equity $ 3,052 $ 3,052
=========== ===========
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
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<TABLE>
COMPUTER TRANSCEIVER SYSTEMS, INC.
Statements of Discontinued Operations
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
April 30, April 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Net Income $ -- $ -- $ -- $ --
------------ ------------ ------------ -----------
Retained (Deficit) at beginning of period (2,450,156) (2,450,156) (2,450,156) (2,450,156)
------------ ------------ ----------- -----------
Retained (deficit) at end of period (2,450,156) (2,450,156) (2,450,156) (2,450,156)
============ ============ =========== ===========
Net Income per share $ -- $ -- $ -- $ --
============ ============ =========== ===========
Weighted Average Number
of Shares Outstanding 2,716,603 2,716,603 2,716,603 2,716,603
============ ============ =========== ===========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
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<PAGE>
<TABLE>
COMPUTER TRANSCEIVER SYSTEMS, INC.
Statements of Cash Flows
(Unaudited)
<CAPTION>
Nine Months Ended
April 30, 1997 April 30, 1996
<S> <C> <C>
Cash Flows from Discontinued Operating
Activities:
Net Income $ -- $ --
Net Adjustments to
Reconcile Net Income to net cash
used for operating activities:
Increase (decrease) in
liabilities:
Accrued expenses -- (43,000)
Net adjustments to reconcile net
income to net cash used for
discontinued operating activities -- (43,000)
Net Cash used for discontinued
operating activities -- (43,000)
Cash Flows From Financing
Activities:
Proceeds from additional
capital contribution -- 43,000
-------------- ---------------
Net Cash Provided by
Financing Activities -- 43,000
-------------- ---------------
Net (Decrease) in Cash -- --
Cash at Beginning of Year -- --
-------------- ---------------
Cash at End of Period $ -- $ --
============== ===============
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
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<PAGE>
COMPUTER TRANSCEIVER SYSTEMS, INC.
Notes to Financial Statements - Unaudited
April 30, 1997
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and
Exchange Commission, and reflect all adjustments which, in the
opinion of the management, are necessary for a fair statement of the
results of the interim periods presented. These financial statements
do not include all disclosures associated with annual financial
statements, and accordingly should be read in conjunction with the
notes to financial statements contained in the Company's Form 10-K
Annual Report for the fiscal year ended July 31, 1996.
Note 2 - SALE OF ASSETS TO VERTEX AND FUTURE PLANS
On August 31, 1994, pursuant to an "Asset Purchase Agreement"
dated May 1, 1993 between the Company and Vertex Industries, Inc.
("Vertex"), the Company's majority stockholder, and with the approval
of the Company's directors and shareholders, the Company sold all of
its assets to Vertex and Vertex assumed the Company's liabilities.
The assets sold included inventory, equipment, receivables,
proprietary technology, goodwill and other intangibles. The selling
price of $1,699,580 was paid by Vertex through the offset and
cancellation of the Company's indebtedness to Vertex in the amount of
$1,257,001, with the balance of $442,579 being paid through the
issuance of 236,042 shares of Vertex common stock to the Company.
CTSI subsequently distributed 233,170 shares of Vertex common stock in
an exchange offer for 746,161 shares of CTSI's common stock. The
Vertex shares reflected in the balance sheet as marketable securities
as of July 31, 1995 represents the remaining shares of 2,872 which
were not distributed to the CTSI shareholders. After completion of
the Exchange Offer, the number of issued and outstanding shares of the
Company was reduced from 3,462,764 to 2,716,603. As a result of the
transaction, Vertex's ownership of the Company is approximately 72.5%.
The Company's current business purpose is to seek out and obtain
an acquisition, and/or merger transaction, whereby its shareholders
may benefit by owning an interest in a viable enterprise. Since the
Company has no operations or significant assets as a result of the
sale, its potential for profits will come solely from operations it
may undertake after any acquisition or merger transaction. The
Company has not received from, or made any specific proposals to, any
possible merger or acquisition candidate and there is no guarantee
that such transaction will occur. Vertex will be responsible for, and
shall be the source of, any funds necessary for the Company to
continue operating and to comply with any regulatory requirements,
taxes, and fees. It will fund any costs associated with pursuing
merger or acquisition candidates.
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<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
The Company ceased operations on August 31, 1994 and, therefore,
has no operating results for the three and six months ended April 30,
1997 and 1996.
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<PAGE>
COMPUTER TRANSCEIVER SYSTEMS, INC.
PART II
OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8K
(a) Exhibits: None
(b) There were no reports on Form 8K filed during the
quarter ended April 30, 1997
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf
by the undersigned thereunto duly authorized.
COMPUTER TRANSCEIVER SYSTEMS, INC.
(Registrant)
Date: June 10, 1997 By: S/ Thomas J. Tully
------------------
Thomas J. Tully
President
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<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-END> APR-30-1997
<CASH> 0
<SECURITIES> 3,052
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,052
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,052
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 2,716
<OTHER-SE> 336
<TOTAL-LIABILITY-AND-EQUITY> 3,052
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
