First Amendment to:
Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C.
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended October 31, 1999 Commission file No. 0-0767
LINCOLN INTERNATIONAL CORPORATION
(Exact Name of Registrant as specified in its charter)
Kentucky 61-0575092
(State of other Jurisdiction (I.R.S. Employer
incorporation or organization) Identification Number)
P.O. Box 43129
2200 Greene Way, Suite 101
Louisville, Kentucky 40220
(Address or principal executive offices) (Zip Code)
(Registrants Telephone Number, Including Area Code) (502) 671-0010
Indicate by check whether the registrant (1) has filed a reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or of such shorter period that the
registrant was required to file such reports) and (2) has been subject to
such filing requirements filing requirements for the past 90 days.
YES X NO
Indicate the numbers of shares outstanding of each of the issuer' classes of
common stock, as of the close of the period covered by this report: 7972 of
the (no-par) voting common stock.
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED BALANCE SHEETS
10/31/99 7/31/99
ASSETS
Current assets:
Cash 299099 396466
Other receivables 58665 2500
Prepaid expenses 0 0
Total current assets 357764 398966
Net property, plant and equipment 3207266 3105922
Noncurrent assets: Deferred tax asset 185506 185506
Investment interest in Accounting USA, Inc. 0 0
Total assets 3750536 3690394
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 81164 32297
Accrued expenses 13910 18750
Current maturities of long-term debt 102908 0
Deferred Rent 0 0
Deposits 0 0
Total current liabilities 197982 51047
Long-term debt, less current maturities 0 0
Deferred Income Taxes - Non Current 883387 883387
Stockholders' equity
Common Stock
Voting 7972 shares O/S 1879898 1879898
Retained earnings 789269 876062
Total stockholders' equity 2669167 2755960
Total liabilities and stockholders' equity 3750536 3690394
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDING OCTOBER 31
10/31/99 10/31/98
Revenues:
Net service and operating revenues 117174 65179
117174 65179
Cost and expenses:
Cost of service and operating revenues 91571 22157
Operating, general and administrative 113340 65459
204911 87616
Income - Loss from operations -87737 -22437
Other income - expense:
Interest expense 4609 -11524
Gain on sale of assets 0 0
Miscellaneous 3200 839
7809 -10685
Less: Minority Interest in Accounting USA 6361 0
Income - Loss before income taxes -73567 -33122
Provision for income taxes 21042 0
Net income - loss -52525 -33122
Net income - loss per common share -6.59 -8.31
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE YEAR TO DATE TO OCTOBER 31
1999 1998
Cash flows from operating activities:
Net income (loss) -52525 -33122
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Depreciation and amortization 18857 10163
(Gain) Loss on sale of assets 0 0
Other receivables -15015 10725
Prepaid expenses -28090 3141
Accounts payable 48867 597
Accrued expenses -4840 3501
Income Taxes 0 0
Total adjustments 19779 28127
Net cash provided by (used in) operating
activities -32746 -4995
Cash flows from investing activities:
Proceeds from sale of fixed assets 0 0
(Purchases of) Sales of property and equipment -67778 0
(Purchases of) Sale of Investment in a Company 0 0
Minority Interest Allocation -6361 0
Net cash provided by (used in) investing -74139 0
Cash flows from financing activities:
Net borrowings (repayments) under
short term notes payable 0 0
Proceeds from the issuance of common stock 0 0
Principal payments on long-term debt 0 -20418
Net cash provided by (used in) financing 0 -20418
Net increase (-decrease) in cash -106885 -25413
Cash, beginning of year 405984 90994
Cash, end of period 299099 65581
Supplemental disclosure of cash flow information:
Cash paid during the year for interest 0 11524
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OCTOBER 31, 1999
Real Estate Business
Net revenue from the real estate rentals increased by approximately
$31,097, or 24% during the quarter ended October 31, 1999 as compared to the
quarter ended October 31, 1998.
Operating costs for the quarter ended October 31, 1999 increased by
approximately $60,829, 69% as compared to the quarter ended October 31, 1998
Increased cost relative to depreciation expense, professional fees and
utilities were cited as the major reasons for the increase.
Consolidated Operations
On August 6, 1999, the Company's Board of Directors approved the
investment of $1,500,000 in Accounting USA, Inc., a company that provides
accounting services for small businesses. The Company holds a 75% equity
position in Accounting USA, Inc. and has invested $200,000 in this company
as of the balance sheet date of October 31, 1999.
Accounting USA, Inc.'s financial information has been consolidated with
the operations of the Company in this quarterly financial statement. Since
the Company holds a 75% ownership position in Accounting USA, Inc., a
minority interest adjustment has been computed and reflected in this
financial statement.
Operating revenues of Accounting USA, Inc. were $30,898 for the quarter
ended October 31, 1999 with direct operating cost and administrative cost for
the samne period of $34,640 and $23,697, respectively. No prior year or
quarter information is available since the operations of Accounting USA,
Inc. began October 1, 1999.
The Company had no other capital commitments at October
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OCTOBER 31, 1999
Litigation Report. On March 23, 1999, two minority shareholders, Mr.
Merle Brewer and Sarah Forree, filed a lawsuit in the United States District
Court, Western District of Kentucky Louisville Division against Lincoln
International Corporation, and individual Thurman L. Sisney, David Barhorst
(who resigned June of 1998) and Mr. Richard Dolin (deceased in February of
1999). The case is styled: Civil Action No. 3:99CV-178-S. On May 18, 1999
Lincoln International Corporation filed a Motion to Dismiss the complaint
alleging that there are no questions of law nor facts substantiating the
allegatons in the complaint. A response to the Motion to Dismiss was
filed by the plaintiffs on July 8, 1999. On June 30, 1999, the plaintiffs
filed a Motion to Amend the complaint to substitute another plaintiff in
place of one of the original plaintiffs, Sarah Forree. At this time, all
Motions are either pending or further briefing will be required. In addition
to replacing one of the original plaintiffs, defendants also raise in their
Motion to Amend the complaint the allegation that notice of dissenters rights
should have been provided in the reverse split that concluded on April 5,
1998. Legal counsel for the coporation gives little merit to the complaint
or causes of actions raised by the plaintiffs. If the Company should be
unsuccessful on its Motion to Dismiss, as well as its opposition to the
Motions filed on behalf of the plaintiffs our answer will be filed to
the complaint.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OCTOBER 31, 1999
NO DIVIDENDS WERE PAID BY THE COMPANY DURING THE INTERIM PERIOD.
Lincoln International Corporation was not required to file a Form 8K during
the current quarter.
The unaudited consolidated financial statements include the accounts
of the Company and all of its subsidiaries after eliminating all material
inter-company accounts and transactions. They reflect all adjustments which
are necessary in the opinion of management to fairly state the financial
position of the Company at October 31, 1999 and the result of its
operations and cash flow for the period then ended.
-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.
LINCOLN INTERNATIONAL CORPORATION
Lee Sisney, President
Richard J. Frockt, Treasurer
Dated this 24th day of November, 1999
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