<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended August 31, 1999
Commission File No. 33-2749
FIRST MORTGAGE CORPORATION
---------------------------
(Exact name of registrant as specified in its charter)
Incorporated under the laws of the State of
Utah 87-03202209
- -------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification Number)
257 East 200 South, Suite 950, Salt Lake City, Utah 84111
---------------------------------------------------------
(Address of Principal Executive Offices)
(801) 363-7663
--------------
Registrant's telephone number, including area code
N/A
------
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.
(1) Yes X No
----- -----
(2) Yes X No
----- -----
Indicate the number of shares outstanding of each class of common stock as of
December 1, 1999.
51,101,680 Common Stock (Par Value $.001)
-----------------------------------------
<PAGE>
First Mortgage Corporation
Form 10-Q
Three Months Ended August 31, 1999
INDEX
Page
-----
PART I Financial Information
ITEM 1 Financial Statements
Balance Sheets . . . . . . . . . . . . . . . . . . . . . .3
Statements of Operations . . . . . . . . . . . . . . . . .5
Statements of Cash Flows . . . . . . . . . . . . . . . . .6
Notes to Financial Statements. . . . . . . . . . . . . . .7
Management's Discussion and Analysis of
the Statement of Income. . . . . . . . . . . . . . . . . .8
PART II Other Information
ITEM 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . .9
ITEM 2 Changes in Securities . . . . . . . . . . . . . . . . . . . . .9
ITEM 3 Defaults upon Senior Securities . . . . . . . . . . . . . . . .9
ITEM 4 Submission of Matters to a Vote of Security Holders . . . . . .9
ITEM 5 Other Information . . . . . . . . . . . . . . . . . . . . . . .9
ITEM 6 Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . .9
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . 10
<PAGE>
First Mortgage Corporation
Balance Sheets
August 31, 1999 and February 28, 1999
<TABLE>
<CAPTION>
(Unaudited)
August February
31, 1999 28, 1999
------------------------
<S> <C> <C>
ASSETS
Current Assets
- --------------
Cash in Bank $ 57,930 $ 48,566
Cash in Savings 100,000 100,000
Other Receivables 3,922 3,922
Contracts Receivable 2,500 2,500
Notes Receivable 628,300 594,000
------------------------
Total Current Assets 792,652 748,988
Fixed Assets
- ------------
Office Equipment 1,596 1,818
Leasehold Improvements 260 330
------------------------
Total Fixed Assets 1,856 2,148
Other Assets
- ------------
Investment 50,000 50,000
Certificate of Deposit 200,000 200,000
Land 47,968 47,968
------------------------
Total Other Assets 297,968 297,968
------------------------
Total Assets $ 1,092,476 $ 1,049,104
========================
</TABLE>
See Accompanying Notes
3
<PAGE>
First Mortgage Corporation
Balance Sheets -Continued-
August 31, 1999 & February 28, 1999
<TABLE>
<CAPTION>
(Unaudited)
August February
31, 1999 28, 1999
------------------------
<S> <C> <C>
Liabilities And Stockholders' Equity
Current Liabilities
- -------------------
Accounts Payable $ 592 $ 592
Taxes Payable 63,685 93,927
------------------------
Total Current Liabilities 64,277 94,519
Stockholders' Equity
- --------------------
Common Stock, 100,000,000
Shares Authorized at $0.001 Par Value;
51,101,680 Shares Issued & Outstanding 51,102 51,102
Capital in Excess of Par Value 242,697 242,697
Retained Earnings 734,400 660,786
------------------------
Total Stockholders' Equity 1,028,199 954,585
------------------------
Total Liabilities &
Stockholders' Equity $ 1,092,476 $ 1,049,104
========================
</TABLE>
See Accompanying Notes
4
<PAGE>
First Mortgage Corporation
Statements of Operations -Unaudited-
For the Six Months Periods Ended August 31, 1999 & 1998
and the Three Months Period Ended August 31, 1999 & 1998
<TABLE>
<CAPTION>
For the Six Months For the Three Months
Periods Ended Periods Ended
August August August August
31, 1999 31, 1998 31, 1999 31, 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues
- --------
Mortgage Recovery $ 188,500 $ 313,000 $ 58,500 $ 219,000
Interest 8,854 43,111 4,492 22,093
Bad Debt Recovery 8,462 1,468 462 1,045
------------ ------------ ------------ ------------
Total Revenues 205,816 357,579 63,454 242,138
Expenses
- --------
Interest Expense 463 -0- -0- -0-
Commission Expense 70,400 134,200 18,800 86,200
Office Expense 31 5,108 3,336 3,016
Rent 4,040 4,350 4,350 2,175
Professional Fees 2,800 5,241 4,080 5,182
Telephone 1,092 1,581 1,026 513
Depreciation 292 270 372 135
Land Expense 1,238 -0- 249 -0-
Travel 3,610 302 7,201 -0-
Taxes 10,800 15,830 -0- 9,330
------------ ------------ ------------ ------------
Total Expenses 94,766 166,882 39,414 106,551
------------ ------------ ------------ ------------
Net Profit Before Taxes 111,050 190,697 73,398 135,587
Income Taxes 37,436 57,728 16,102 48,950
------------ ------------ ------------ ------------
Net Profit After Taxes $ 73,614 $ 132,969 $ 57,296 $ 86,637
============ ============ ============ ============
Earnings Per Share $ 0.01 $ 0.02 $ 0.001 $ 0.02
Weighted Average
Shares Outstanding 51,101,680 51,101,680 51,101,680 51,101,680
</TABLE>
See Accompanying Notes
5
<PAGE>
First Mortgage Corporation
Statements of Cash Flows
For the Six Months Periods Ended August 31, 1999 & 1998
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
1999 1998
------------------------
<S> <C> <C>
Cash Flows from Operating Activities
- ------------------------------------
Net Income $ 73,614 $ 132,969
Adjustments to Reconcile Net Income
to Operating Activities:
Rounding -0- 1
Depreciation 292 270
Changes in Operating Assets & Liabilities:
Decrease in Other Receivables -0- 9,509
(Decrease) in Accounts Payable -0- ( 883)
Increase (Decrease) in Taxes ( 30,242)( 53,543)
------------------------
Net Cash Provided by Operating Activities 43,664 88,323
Cash Flows from Investing Activities
- ------------------------------------
Increase in Contracts ( 136,800)( 282,500)
Collected On Contracts 102,500 -0-
------------------------
Net Cash Provided by Investing Activities ( 34,300)( 282,500)
Cash Flows from Financing Activities
- ------------------------------------
Net Cash Provided by Financing Activities -0- -0-
------------------------
Increase (Decrease) in Cash 9,364 ( 194,177)
Cash at Beginning of Year 148,566 298,335
------------------------
Cash at End of Year $ 157,930 $ 104,158
========================
Expense Disclosures
- -------------------
Interest $ -0- $ -0-
Taxes 37,436 57,728
</TABLE>
See Accompanying Notes
6
<PAGE>
First Mortgage Corporation
Notes to Financial Statements
NOTE #1 - Statement Preparation
- -------------------------------
The Company has prepared the accompanying financial statements with interim
financial reporting requirement promulgated by the Securities and Exchange
Commission. The information furnished reflects all adjustments which are,
in the opinion of management, necessary for a fair presentation of financial
position and results of operations.
The consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
February 28, 1999 10-K report.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
Liquidity and Capital Resources
- -------------------------------
Management believes that proceeds from current revenues from interest and
cash reserves will provide sufficient capital to meet the Company's needs for
the next twelve months.
Management believes that its prime source of funds will be interest earned
from the trust deed notes receivable.
Results of Operations
- ---------------------
During the six months period ending August 31, 1998, the Company collected
$313,000 from mortgage recovery activities and $43,111 from interest income.
Comparable figures for the six months of 1997 are $100,700 from mortgage
recovery income and $11,946 from interest income.
For the three months period ending August 31, 1998, mortgage recovery
revenues were $219,000 and interest earnings were $22,093. Comparable
figures for the three month period of 1997, are $81,927 from mortgage
revenues and $7,002 from interest income. The increase in revenues from the
previous comparable period are the result of specific loan packages obtained
from the FDIC. The Company expects this trend to continue into the next six
months but not into the next fiscal year.
The Company had $357,579 in revenues in the six months period ending August
31, 1998. For the comparable six months period ending August 31 1997, total
revenues were $112,812.
Commissions expense for the six months period ending August 31, 1998, were
$134,200 and $18,000 for the six months period of 1997.
Administrative expenses for the six months period ending August 31, 1998,
were $32,682 and for the comparable period of 1997 were $20,614.
Net profit after provisions for income taxes were $132,969 for August 31,
1998, and $57,296 for August 31, 1997.
The Company's management anticipates that revenues for the next fiscal year
will be limited to interest earned on mortgage contracts. The collection of
loan packages from FDIC and RTC is largely completed at February 28, 1999.
8
<PAGE>
PART II - OTHER INFORMATION
----------------------------
Item 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . None
Item 2 Changes in the Rights of the Company's
Security Holders. . . . . . . . . . . . . . . . . . . . . None
Item 3 Defaults by the Company on its Senior Securities. . . . . .None
Item 4 Results of Votes of Security Holders. . . . . . . . . . . .None
Item 5 Other Information . . . . . . . . . . . . . . . . . . . . .None
Item 6 Exhibits and Reports on Form 8-K. . . . . . . . . . . . . .None
9
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Date: December 5, 1999 By:/S/ William S. Greaves
-------------------------
William S. Greaves, President
(Principal Executive Officer)
(Principal Financial & Accounting Officer)
10
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000036548
<NAME> FIRST MORTGAGE CORP
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> FEB-28-1999
<PERIOD-END> AUG-31-1999
<CASH> 162,824
<SECURITIES> 0
<RECEIVABLES> 672,922
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 835,746
<PP&E> 2,002
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,135,716
<CURRENT-LIABILITIES> 123,967
<BONDS> 0
0
0
<COMMON> 51,102
<OTHER-SE> 960,647
<TOTAL-LIABILITY-AND-EQUITY> 1,135,716
<SALES> 0
<TOTAL-REVENUES> 142,362
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 55,750
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 86,612
<INCOME-TAX> 29,448
<INCOME-CONTINUING> 57,164
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 57,614
<EPS-BASIC> 0.001
<EPS-DILUTED> 0.001
</TABLE>
