SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Annual Report Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the Quarter Ended Commission File No.
January 31, 1997 0-5304
INCORP, INC.
UTAH 87-0282745
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
11339 Sorrento Valley Road, Suite C, San Diego, California 92121
(Address of Principal Executive Offices)
Registrant's telephone number including area code: (619) 643-1777
Former name, former address, and former fiscal
year end, if changed since last report. None
Indicate by checkmark 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 in the past 90 days:
Yes X No
----------- ---------
Indicate the number of shares outstanding for each of the issuer's
classes of Common Stock as of the last practical date:
Common Stock, Par Value $.01 Per Share, 20,781,992 Shares Outstanding
at January 31, 1997. <PAGE>
INCORP, INC.
TABLE OF CONTENTS
PART I FINANCIAL STATEMENTS
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Balance Sheets. . . . . . . . . . . . . . . . . . . . . . . . . . . .3
Statement of Operations . . . . . . . . . . . . . . . . . . . . . . .4
Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . .5
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . .6
PART II
ITEM 2 MANAGEMENT DISCUSSION AND FINANCIAL
CONDITION AND RESULTS OF OPERATIONS . . . . . . . . . . . .6
OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . .7
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . .8
<PAGE>
INCORP, INC.
Balance Sheets (Unaudited)
January 31, 1997 & July 31, 1996
Unaudited
1997 1996
----------- -----------
ASSETS
CURRENT ASSETS
Cash $ 1,700 $ 3,248
Receivables 3,048 3,048
Inventory 500 500
----------- -----------
Total Current Assets 5,248 6,796
OTHER ASSETS
Refundable Deposit 3,000 3,000
Equipment 5,642 6,151
Oil & Gas Properties
(Successful Efforts Method) 882,901 932,901
Less Accumulated Depletion (683,038) (673,505)
----------- ----------
Total Other Assets 208,505 268,547
----------- -----------
TOTAL ASSETS $ 213,753 $ 275,343
=========== ===========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable & Accrued Expenses $ 483,302 $ 320,752
Notes Payable 258,627 176,522
----------- -----------
Total Current Liabilities 741,929 497,274
LONG TERM LIABILITIES
Notes Payable -0- 32,105
STOCKHOLDERS' EQUITY
Capital Stock $0.01 Par Value 50,000,000
Shares Authorized, 21,531,992 Shares &
20,781,992 Shares Issued & Outstanding 215,320 207,820
Paid In Capital 6,235,787 6,168,287
Deficit in Retained Earnings (6,979,283) (6,630,143)
----------- -----------
Total Stockholders' Equity (528,176) (254,036)
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 213,753 $ 275,343
=========== ===========
The accompanying notes are an integral part of these financial statements<PAGE>
INCORP, INC.
Statement of Operations (Unaudited)
For the Three Months Period Ended January 31, 1997 & 1996
and the Six Months Ended January 31, 1997 & 1996
For the Three For the Six
Months Ended Months Ended
January January January January
31, 1997 31, 1996 31, 1997 31, 1996
----------- ----------- ----------- -----------
REVENUES
Golf Sales & Fees $ 6,376 $ -0- $ 27,993 $ -0-
----------- ----------- ----------- -----------
Total Revenues 6,376 -0- 27,993 -0-
COST & EXPENSES
Cost of Golf Sales 5,237 -0- 9,815 -0-
----------- ----------- ----------- -----------
Gross Profit 1,139 -0- 18,178 -0-
OPERATING EXPENSES
General & Administrative
Expenses 188,463 110,626 321,233 161,325
Depreciation &
Amortization 4,553 6,643 10,043 13,819
----------- ----------- ----------- -----------
Total Cost & Expenses 193,016 117,269 331,276 175,114
----------- ----------- ----------- -----------
LOSS FROM OPERATIONS (191,877) (117,269) (313,098) (175,114)
OTHER INCOME (EXPENSES)
Oil & Gas Revenues 7,674 10,828 17,053 17,667
Lease Operating Expenses
Delayed Rentals, Royalties
& Taxes - Oil Well -0- -0- 3,096 -0-
Oil Well Impairment (50,000) -0- (50,000) -0-
----------- ----------- ----------- -----------
Total Other Income
(Loss) (42,326) 10,828 (36,043) 17,667
----------- ----------- ----------- -----------
Net Loss $ (234,203) $ (106,441) $ (349,141) $ (157,447)
=========== =========== =========== ===========
Net Loss Per Share
of Common Stock $ (.01) $ (.01) $ (.01) $ (.01)
Weighted Average
Number Of Shares
Outstanding
During Period 21,156,992 15,691,475 21,156,992 17,125,741
The accompanying notes are an integral part of these financial statements<PAGE>
INCORP, INC.
Statement of Cash Flows (Unaudited)
For the Six Month Period Ending January 31, 1997 & 1996
Six Month Period Ending
January January
31, 1997 31, 1996
----------- -----------
OPERATING EXPENSES
Net (Loss) from Operations $ (349,141) $ (157,447)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by
Operating Activities:
Depreciation 10,043 13,819
Write Off of Oil Well Impairment 50,000 62,250
Non Cash Stock Issued for Services
Rounding Adjustments -0- (1)
Changes in Operating Assets & Liabilities
(Increase) Decrease in Receivables -0- 5,304
Increase (Decrease) in Accounts Payable 162,550 32,485
----------- -----------
Net Cash Provided (Used) by
Operating Activities (126,548) (43,590)
CASH FLOWS FROM INVESTING ACTIVITIES -0- -0-
----------- -----------
Net Cash Provided (Used) by
Investing Activities -0- -0-
CASH FLOWS FROM FINANCING ACTIVITIES
(Increase) Decrease in Notes Payable 50,000 56,530
Sale of Common Shares 75,000 -0-
----------- -----------
Net Cash Provided (Used) by
Financing Activities 125,000 56,530
----------- -----------
Increase (Decrease) in Cash (1,548) 12,940
Cash at Beginning of Period 3,248 1,516
----------- -----------
Cash at End of Period $ 1,700 $ 14,456
=========== ===========
Disclosures from Operating Activities
Interest $ 14,550 $ 9,983
Taxes -0- -0-
The accompanying notes are an integral part of these financial statements<PAGE>
INCORP, INC.
Notes to Financial Statements (Unaudited)
ITEM I
NOTE #1 - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three month
period ending January 1997 are not necessarily indicative of the results that
may be expected for the year ended July 31, 1997. For further information,
refer to the financial statements and footnotes thereto included in the
Company's annual report on Form 10-K for the year ended July 31, 1996.
ITEM II
Management's Discussion and Analysis of Financial Condition and Results of
Operation
Total revenues for the quarter ended January 31, 1997 were $14,050
compared to $10,828 for the quarter ended January 31, 1996. Total expenses
for the quarter were $248,253 compared to $117,269 for the quarter ended
January 31, 1996.
Total revenues for the six months ended January 31, 1997 were $31,089
compared to $17,667 for the quarter ended January 31, 1996. Expenses for
the period were $372,913 compared to $175,114 for the period ended January
31, 1996.<PAGE>
PART II
OTHER INFORMATION
A Special Shareholders Meeting was held on November 18, 1996 at the
Registrant's headquarters. By an overwhelming majority of the votes cast,
shareholders adopted management's state of proposals including the
election of the state of the Board of Directors, a 1:2 reverse split of the
common shares, authorization for issuance of preferred shares, a change in
the state of incorporation, and the appointment of the 1996-97 auditing firm.
During the period, the Company authorized the issuance of 900,000 shares
of common stock in conjunction with the sale of $150,000 of private placement
investment units.
In late January, Mr. Michael Pastore, a newly elected director, resigned from
the Board. His seat remained unoccupied through the end of the quarter.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
INCORP, INC. (Registrant)
/s/ Edmund J. Irvine, Jr.
Date: May 20, 1997 By:-------------------------------
Edmund J. Irvine, Jr.
President & Chief Executive Officer
/s/ Michael Sharp
Date: May 20, 1997 By:---------------------------------
Michael Sharp
Chief Financial Officer
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