FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended June 30, 1998
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or
[ ] 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 1-8254
THACKERAY CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
Delaware 04-2446697
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
400 Madison Avenue
Suite 309
New York, New York 10017
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(Address of Principal Executive Offices) (Zip Code)
(212) 759-3695
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(Registrant's Telephone Number, Including Area Code)
Unchanged
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(Former name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 5,107,401 shares of common
stock, $.10 par value, as of August 5, 1998.
NYFS07...:\55\69555\0001\1708\FRM8048U.05A
<PAGE>
PART I. - FINANCIAL INFORMATION
Item 1. - Financial Statements
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1998 AND DECEMBER 31, 1997
<TABLE>
<CAPTION>
1998 1997
---- ----
ASSETS: (UNAUDITED)
<S> <C> <C>
CASH AND CASH EQUIVALENTS $4,940,000 $5,156,000
RECEIVABLES FROM REAL ESTATE PARTNERSHIP 586,000 456,000
INVESTMENTS IN REAL ESTATE 5,756,000 5,756,000
OTHER ASSETS, NET 220,000 196,000
----------- -----------
TOTAL ASSETS $11,502,000 $11,564,000
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $121,000 $31,000
ACCRUED INCOME AND OTHER TAXES 294,000 306,000
OTHER LIABILITIES 122,000 128,000
----------- -----------
TOTAL LIABILITIES 537,000 465,000
----------- -----------
STOCKHOLDERS' EQUITY: (SEE NOTE 3)
COMMON STOCK, $.10 PAR VALUE
(20,000,00 SHARES AUTHORIZED;
5,107,401 SHARES ISSUED AND OUTSTANDING
IN 1998 AND 6,187,401 SHARES ISSUED
IN 1997) 511,000 619,000
CAPITAL IN EXCESS OF PAR VALUE 43,542,000 53,424,000
ACCUMULATED DEFICIT (33,088,000) (32,954,000)
TREASURY STOCK (1,080,000 SHARES IN 1997) 0 (9,990,000)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 10,965,000 11,099,000
----------- ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $11,502,000 $11,564,000
=========== ===========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE BALANCE SHEETS.
2
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
REVENUES FROM REAL ESTATE OPERATIONS $16,000 $16,000
-------------- ------------
GENERAL AND ADMINISTRATIVE EXPENSES (194,000) (119,000)
INTEREST INCOME 67,000 61,000
-------------- ------------
(127,000) (58,000)
-------------- ------------
LOSS BEFORE INCOME TAXES (111,000) (42,000)
INCOME TAXES 0 0
-------------- ------------
NET LOSS ($111,000) ($ 42,000)
============== ============
LOSS PER SHARE ($0.02) ($0.01)
============== ============
NUMBER OF SHARES 5,107,401 5,107,401
============== ============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
3
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
REVENUES FROM REAL ESTATE OPERATIONS $32,000 $32,000
-------------- ------------
GENERAL AND ADMINISTRATIVE EXPENSES (308,000) (209,000)
INTEREST INCOME 142,000 125,000
-------------- ------------
(166,000) (84,000)
-------------- ------------
LOSS BEFORE INCOME TAXES (134,000) (52,000)
INCOME TAXES 0 0
-------------- ------------
NET LOSS ($134,000) ($52,000)
============== ============
LOSS PER SHARE ($0.03) ($0.01)
============== ============
NUMBER OF SHARES 5,107,401 5,107,401
============== ============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
4
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
CASH FLOWS USED IN OPERATING ACTIVITIES: ($134,000) ($52,000)
NET LOSS
ADJUSTMENTS TO RECONCILE NET LOSS TO NET
CASH USED IN OPERATING ACTIVITIES:
DEPRECIATION 2,000 2,000
CHANGES IN ASSETS AND LIABILITIES:
INCREASE IN RECEIVABLES FROM REAL
ESTATE PARTNERSHIP (130,000) (132,000)
INCREASE IN ACCOUNTS PAYABLE AND
ACCRUED LIABILITIES 72,000 49,000
OTHER, NET (26,000) (22,000)
------------ -----------
NET CASH FLOWS USED IN OPERATING ACTIVITIES (216,000) (155,000)
------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
PROCEEDS FROM SALE OF REAL ESTATE 0 102,000
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CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 5,156,000 4,615,000
------------- ------------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 4,940,000 $ 4,562,000
============= ============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
5
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1998 and 1997
(UNAUDITED)
1. BASIS OF PRESENTATION
The significant accounting policies followed by the Company in the
preparation of these unaudited interim financial statements are consistent
with the accounting policies followed in the audited annual financial
statements. In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation have
been included.
Certain information and footnote disclosures included in the audited
financial statements have been omitted. For additional information,
reference is made to the financial statements and notes thereto included in
the Company's Annual Report to Stockholders for the year ended December 31,
1997.
The net loss applicable to common stock for the six months and three months
ended June 30, 1998 and 1997 was divided by the number of shares outstanding
during the period to determine per share data.
2. INVESTMENTS IN REAL ESTATE
The Company's real estate partnership originally was to terminate in the
event construction financing was not obtained by May 20, 1998; the date was
extended in May to December 31, 1998.
3. TREASURY STOCK
In March 1998, the Company cancelled the 1,080,000 shares of its common
stock held in treasury, returning them to the status of authorized and
unissued shares of the Company. Accordingly, the Company has eliminated its
Treasury Stock in the amount of $9,990,000, and charged Common Stock and
Capital in Excess of Par Value for $108,000 and $9,882,000, respectively.
6
<PAGE>
4. INCOME TAXES
The Company anticipates it will generate a Federal taxable loss for the year
ended December 31, 1998, and therefore it expects that no Federal income
taxes will be payable for such year. For the year ended December 31, 1997,
the Company's Federal taxable income was eliminated through the utilization
of Federal income tax net operating loss carryforwards. Accordingly, no
Federal income tax provisions have been made for the six month and three
month periods ended June 30, 1998 and 1997.
5. STATEMENTS OF CASH FLOWS
There were no interest payments for the six months ended June 30, 1998 and
1997.
There were state income tax payments during the six months ended June 30,
1998 totaling $10,000. There were no income tax payments during the six
months ended June 30, 1997.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(1) Material Changes in Financial Condition
---------------------------------------
The Company anticipates that its current cash balance will be sufficient
to fund its requirements for the foreseeable future.
At June 30, 1998 the Company had no material commitments for capital
expenditures.
(2) Material Changes in Results of Operations
-----------------------------------------
Total real estate revenues were $32,000 in each of the six month periods
ended June 30, 1998 and 1997.
General and administrative expenses were $308,000 in the first half of
1998 versus $209,000 for the comparable period in 1997. The increase is due to
professional fees and application costs aggregating $53,000 related to the
Company's common stock listing on the American Stock Exchange in the second
quarter of 1998. Increased employee compensation costs also were incurred during
the period.
7
<PAGE>
Interest income for the six months ended June 30, 1998 was $142,000,
which was $17,000 higher than the amount for the comparable period in 1997. The
increase results from the Company's maintaining higher average cash investment
balances.
8
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The Annual Meeting of Stockholders of the Company was held on May 7,
1998.
(b) Martin J. Rabinowitz, Jules Ross, Ronald D. Rothberg, Moses Rothman and
John Sladkus were elected directors of the Company at the meeting.
(c) The following table show the results of the voting taken at the meeting:
Nominee Votes For Votes Withheld
------- --------- --------------
Martin J. Rabinowitz 4,488,732 280,826
Jules Ross 4,491,832 277,726
Ronald D. Rothberg 4,491,949 277,609
Moses Rothman 4,491,739 277,819
John Sladkus 4,486,932 282,626
There were no abstention or broker non-votes with respect to any of the
directors.
4,563,315 shares were voted in favor of the proposal to ratify the
appointment of Arthur Andersen LLP as the independent auditors of the
Company for the year ending December 31, 1998, with 205,435 voted
against, 808 shares abstained and there were no broker non-votes.
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 Company did not file any Current Reports on Form 8-K during the
quarter ended June 30, 1998.
9
<PAGE>
SIGNATURES
Pursuant to the requirement 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.
THACKERAY CORPORATION
By /s/ Jules Ross
-----------------------------------
Jules Ross
Vice President, Finance,
(Principal Financial Officer)
Date: August 11, 1998
10
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS CONTAINED IN THE BODY OF THE ACCOMPANYING FORM 10-Q AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 4,940,000
<SECURITIES> 0
<RECEIVABLES> 586,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 11,502,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 511,000
<OTHER-SE> 10,454,000
<TOTAL-LIABILITY-AND-EQUITY> 11,502,000
<SALES> 0
<TOTAL-REVENUES> 32,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 308,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (142,000)
<INCOME-PRETAX> (134,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (134,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (134,000)
<EPS-PRIMARY> (.03)
<EPS-DILUTED> (.03)
</TABLE>
