UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (C) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended March 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the transition period ___________________ to _________________
Commission File Number 0-24282
Monmouth Capital Corporation
(Exact name of registrant as specified in its charter)
New Jersey 21-0740878
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification number)
125 Wyckoff Road, Eatontown, New Jersey 07724
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (908) 542-4927
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock $1.00 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required 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 90days. Yes X No
Indicate by check if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. X
The aggregate market value of voting stock held by non-affiliates
of the Registrant was $2,661,416 (based on 747,064 shares of
common stock at $3.5625 per share, the average of the bid and ask
price on June 13, 1996).
The number of shares outstanding of issuer's common stock as of
June 13, 1996 was 1,151,112 shares.
<PAGE>
PART I
ITEM 1. BUSINESS
General Development of Business
Monmouth Capital Corporation (the Company) operates as a
real estate company which owns real estate investments and sells
and finances manufactured homes. The Company is a corporation
organized in the State of New Jersey. The Company commenced
operations in 1961.
Prior to fiscal 1994, the Company operated as a small
business investment company under the Small Business Investment
Company Act of 1958 and as an investment company under the
Investment Company Act of 1940. As such, the Company was able to
distribute its income prior to income taxes as dividends to
shareholders. The Company was allowed a deduction from taxable
income for these distributions.
With shareholder approval, the Company surrendered its
license to operate as a small business investment company and
deregistered as an investment company. On January 15, 1993, the
Small Business Administration approved the surrender of the
Company's license. On July 20, 1993, the Securities and Exchange
Commission entered an Order that the Company had ceased to be an
investment company. Since the Company is no longer an investment
company, earnings are now fully taxable.
Certain members of the Company's Board of Directors manage
two real estate investment trusts. In 1995, the Company success-
fully completed a Rights Offering to its shareholders. The
Company raised approximately $1,600,000 after expenses bringing
total equity to approximately $4,500,000. The Company intends
to raise additional capital through rights offerings and other
placements and use the proceeds to acquire additional real
estate properties.
Narrative Description of the Business
Prior to fiscal 1994, the Company made loans to small
business concerns located throughout the northeast region of the
United States. Generally, these loans were collateralized by
commercial or residential real property.
A description of the Company's existing loan portfolio of
$2,368,248 is incorporated herein by reference to Note 3 of the
Notes to Consolidated Financial Statements - Loans Receivable.
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<PAGE>
On March 31, 1994, the Company purchased its first real
estate investment, a net leased industrial building in Bethlehem,
Pennsylvania. This building is net leased to three tenants with
leases expiring from 1998 to 2001. The gross rent on these
leases total approximately $153,000 for fiscal 1996. The tenants
reimburse the Company for taxes, insurance, maintenance (other
than roof and structural repairs), etc. The Company purchased
this building for cash.
The Company has no limitation on leverage and intends to use
leverage when available. As a practical matter, real estate with
short-term leases or non-rated tenants cannot generally be
leveraged.
During fiscal 1994, the Company formed a wholly-owned
subsidiary, The Mobile Home Store, Inc., to finance and sell
manufactured homes. At March 31, 1996, loans receivable relating
to the financing of manufactured home sales amounted to
$1,578,326.
Management
The management of the Company currently operates Monmouth
Real Estate Investment Corporation (MREIC) and United Mobile
Homes, Inc. (UMH), two real estate investment trusts (REITs).
MREIC is now specializing in net leased industrial properties to
rated tenants on medium term leases. UMH specializes in
investments in manufactured home communities. It is intended that
the Company will invest in real estate ventures that do not qualify
under the investment objectives of MREIC and UMH. To the extent
that there may be conflicts of interest as to prospective
investments, the Company may be deprived of investment
opportunities.
General Risks of Real Estate Ownership
The Company's investments will be subject to the risks
generally associated with the ownership of real property,
including the uncertainty of cash flow to meet fixed obligations,
adverse changes in national economic conditions, changes in the
relative popularity (and thus the relative price) of the
Company's real estate investments when compared to other
investments, adverse local market conditions due to changes in
general or local economic conditions or neighborhood values,
changes in interest rates and in the availability of mortgage
funds, costs and terms of mortgage funds, the financial
conditions of tenants and sellers of properties, changes in real
estate tax rates and other operating expenses (including
corrections of potential environmental issues as well as more
stringent governmental regulations regarding the environment),
governmental rules and fiscal policies as well as expenses
resulting from acts of God, uninsured losses and other factors
which are beyond the control of the Company.
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<PAGE>
Competition
The Company will be competing for real estate investments
with numerous other real estate entities, such as individuals,
corporations, real estate investment trusts and other enterprises
engaged in real estate activities, possibly including certain
affiliates of the Company. In many cases, the competing concerns
may be larger and better financed than the Company, making it
difficult for the Company to secure new real estate investments.
Environmental, Regulatory and Energy Problems
The Company must comply with certain Federal Environmental
Protection Agency Regulations as well as state and local
governmental regulations.
In conjunction with the purchase of the Bethlehem building,
a Phase I environmental assessment was performed. This
assessment consisted of searches of Federal and State databases
to determine potential sources of contamination, investigation of
the site history, and visual inspection. The assessment
concluded that there was no evidence to suggest that the site has
ever experienced a significant spill or environmental incident.
Additionally, inspections of properties are usually made and
certificates of compliance are usually obtained upon the sale of
property or upon a change of tenancy. Therefore, there is no
assurance that, in connection with compliance with environmental
regulations, substantial capital expenditure would not be
incurred at the time the Company desired to sell its properties
or at the time of a change of tenancy. Management is not aware
of any material environmental problems affecting the Company's
newly acquired property.
Number of Employees
At March 31, 1996, the Company had five full-time employees.
A Board of Directors consisting of ten directors is responsible
for the general policies of the Company. The Company utilizes
the services of a management company to manage its property.
ITEM 2. PROPERTIES
The Company has one property, located in Bethlehem,
Pennsylvania. See Item 1 - Narrative Description of the
Business for further information.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
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<PAGE>
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Prior to October 19, 1995, the shares of the Company were
traded on the over-the-counter market. As of October 19, 1995,
the Company's shares are traded on the National Association of
Securities Dealers Automatic Quotations (NASDAQ) Small Capitalization
market under the symbol "MONM". The per share range of high and low
market prices and distributions paid to shareholders during each
quarter of the last two fiscal years were as follows:
1995-96 1994-95
Fiscal Market Price Distri- Fiscal Market Price Distri-
Qtr. High Low bution Qtr. High Low bution
First 3-5/8 3-1/8 -- First 3-3/4 3 --
Second 3-5/8 3-1/8 -- Second 4-1/4 3-1/4 --
Third 3-5/8 3-1/8 $ .05 (1) Third 4-1/4 3-1/4 $.05 (1)
Fourth 3-5/8 3-1/8 -- Fourth 3-1/4 3 --
(1) Total distributions to shareholders for the years ended
March 31, 1996 and 1995 amounted to $55,371 ($.05 per share)
and $25,534 ($.05 per share), respectively, all of which was
taxed as ordinary income.
The over-the-counter market quotations reflect the inter-
dealer prices, without retail mark-up, mark-down or commission, and
may not necessarily represent actual transactions.
As of March 31, 1996, there were approximately 520 holders
of the Company's common stock based on the number of record
owners.
Future dividend policy will depend on the Company's
earnings, capital requirements, financial condition, availability
and cost of bank financing and other factors considered relevant
by the Board of Directors.
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<PAGE>
<TABLE>
<CAPTION>
ITEM 6. SELECTED FINANCIAL DATA
FOR THE YEARS ENDED MARCH 31,
1996 1995 1994* 1993 1992
<S> <C> <C> <C> <C> <C>
Income Statement Data:
Total
Income $2,644,137 $1,338,719 $ 344,840 $471,106 $485,668
Total
Expenses 2,267,250 1,149,667 336,733 354,977 439,482
Gains on
Sales or
of Assets -0- -0- -0- -0- 36,115
Income
Taxes 171,308 87,200 5,286 788 777
Net
Income 205,579 101,852 2,821 115,341 81,524
Net Income
Per Share 0.18 0.16 0.01 0.23 0.16
===================================================================
Balance Sheet Data:
Total
Assets $5,752,047 $5,068,042 $3,216,262 $3,962,997 $4,984,131
Notes & Deben-
tures Payable -0- -0- -0- 1,000,000 2,000,000
Shareholders'
Equity 4,706,755 4,477,290 2,778,911 2,893,547 2,859,915
===================================================================
Cash Dividends
Per Share $.05 $.05 $0.23 $ 0.16 $0.40
Average Number
of Shares Out-
standing 1,111,624 646,693 510,680 510,680 510,680
* Prior to fiscal 1994, the Company operated as a Small Bus-
iness Investment Company (SBIC). Revenues consisted primarily of
interest income on loans receivable. The Company distributed
taxable earnings in accordance with Internal Revenue Code regula-
tions. No provision was made for Federal and State income taxes.
Effective with the year ended March 31, 1994, revenues consist of
rental income, sales of manufactured homes, and interest income on
loans. Dividends are based on the Company's operations and are at
the discretion of the Board of Directors. Since the Company is no
longer an SBIC, income taxes have been accrued.
</TABLE>
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<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
Liquidity and Capital Resources
Prior to fiscal 1994, Monmouth Capital Corporation (the
Company) operated as a small business investment company under the
Small Business Investment Company Act of 1958 and as an
investment company under the Investment Company Act of 1940.
With shareholder approval, the Company surrendered its license to
operate as a small business investment company and
deregistered as an investment company. On January 15, 1993, the
Small Business Administration approved the surrender of the
Company's license. During 1994, the Securities and Exchange
Commission accepted the Company's application to cease to be an
investment company. The Company now intends to engage in real
estate activities. Because of the change in the Company's
operations, prior period results may not be indicative of future
performance.
On March 31, 1994, the Company purchased its first real
estate investment, a net-leased industrial building in Bethlehem,
Pennsylvania. The purchase price was $1,080,000 in cash. If the
Company had held the building for the entire year, net income would
have been increased by $61,000, based on leases in place. During
fiscal 1994, the Company also formed a wholly-owned subsidiary,
The Mobile Home Store, Inc. (MHS),incorporated in the State of
New Jersey, to finance and sell manufactured homes.
During fiscal 1994, the Company purchased long-term
government securities (GNMAs) with a maturity of January 20, 2024.
The purpose of the purchase of these securities was to use them
for cash management. The Company earns interest of 6.5% on these
securities versus 2% to 3% on idle funds.
Net cash used by operating activities for the year ended March 31,
1996 amounted to $477,613 as compared to net cash used by operating
activities of $29,529 for the year ended March 31, 1995. This
increase in net cash used by operating activities is due primarily
to an increase in inventory of manufactured homes. Net cash used by
operating activities for the year ended March 31, 1994 amounted to
$81,496. The decrease in net cash used by operating activities from 1994
to 1995 was due primarily to increased income during 1995.
Loans receivable increased by $615,437 during 1996. This
increase is the result of $1,405,605 in new loans made offset by
$790,168 in principal repayments.
Securities available for sale decreased by $550,438 as a
result of the sale of $501,562 in U.S. Treasury Notes and other
decreases of $48,876.
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<PAGE>
The Company's ability to generate adequate cash to meet its
needs is dependent primarily on the success of the sale and
financing of manufactured homes, its real estate investment,
leveraging of its real estate investment, collection of loans
receivable, availability of bank borrowings and access to the
capital markets.
Results of Operations
Income is primarily comprised of the sale of manufactured homes,
interest and rent. Sales of manufactured homes increased from $117,553
in 1994 to $968,990 in 1995 to $1,724,021 in 1996. MHS was formed
during 1994 to sell and finance manufactured homes. The increase during
1995 and 1996 was due to increased sales volume. Interest income
decreased from $297,032 in 1994 to $198,743 in 1995. This decrease
was primarily due to principal reductions. Interest income increased
from $198,743 for the year ended March 31, 1995 to $360,076 for the
year ended March 31, 1996. This increase was due primarily to new
loans made by MHS. At March 31, 1996 and 1995, the Company had one
loan which was considered non-performing. The borrower has resumed
making payments. However, the Company has instituted foreclosure
proceedings. The Company believes that there is adequate
collateral for this loan. Rental income relating to the Bethlehem,
Pennsylvania industrial building remained relatively stable during
1995 and 1996.Other income increased during 1995 by $377,173 due
primarily to the gain of $346,291 on the sale of the ICS convertible
debenture.
Cost of manufactured home sales increased from $74,423 in 1994 to
$648,836 in 1995 to $1,397,389 in 1996. These increases were directly
related to the increases in sales. Selling Expense increased to $132,707
in 1996 as compared to $79,037 in 1995 and $13,643 in 1994. These
increases were directly related to the increases in sales. Salaries and
Employee Benefits increased from $101,177 in 1994 to $125,453 in 1995
to $174,525 in 1996. During the latter part of 1995, two new employees
were hired. Professional fees increased during 1996 as a result of fees
incurred in the expansion of operations of MHS. Professional fees
increased by $17,045 during 1995 as a result of expenses incurred by
MHS. Other expenses increased by $188,304 during 1996 and $76,686 during
1995 due to expenses incurred in the expansion of operations of MHS.
Interest expense increased to $68,248 during 1996 from $31,746 during
1995 and $51,049 during 1994. The increase in interest expense during
1996 was due to additional debt of MHS relating to the financing of
inventory.
Income taxes rose from $5,286 in 1994 to $87,200 in 1995 to
$171,308 in 1996. These increases in income taxes are directly related
to the increases in income.
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<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data listed in
Part IV, Item 14 (a)(1) are incorporated herein by reference and
filed as a part of this report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
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<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Several of the Directors and Officers of the Company also serve
as directors of Monmouth Real Estate Investment Corporation (MREIC)
and United Mobile Homes, Inc. (UMH), both publicly-owned real estate
investment trusts.
Director Since/
Principal Occupation Shares Owned and
Name, Age and Title Past Five Years % of Total
Ernest V. Bencivenga Treasurer(1961 to present) 1961
(78) Secretary(1967 to present). Owns 5,976 shs
Secretary/Treasurer Treasurer and Director of .52% (1)
and Director MREIC; Secretary/Treasurer
and Director of UMH.
Anna T. Chew Controller(1991 to present). 1994
(37) Certified Public Accountant; Owns 3,680 shs
Controller and Vice President, Chief .32%(2)
Director Financial Officer and Director
of UMH and Controller/Director
of MREIC. Prior to 1991,
Senior manager KPMG Peat
Marwick.
Boniface DeBlasio Chairman of the Board(1968 1961
(75) to Present). Director of Owns 30,026 shs
Board Chairman and MREIC. 2.63% (3)
Director
Charles P.Kaempffer Self-employed investor. 1970
(58) Director of MREIC, UMH and Owns 15,331 shs
Director Sovereign Community Bank 1.35% (4)
Eugene W. Landy President(1961 to Present). 1961
(62) Attorney.President of MREIC; Owns 142,735 shs
President and Chairman of the Board of UMH. 12.53% (5)
Director
Samuel A. Landy Attorney. President and 1994
(35) Director of UMH; Director Owns 29,307 shs
Director of MREIC. 2.57% (6)
James E. Mitchell General Partner of Mitchell 1994
(55) Partners,L.P. Chairman of Owns 62,000 shs
Director the Board of Balboa 5.45% (7)
Securities Corporation.
W. Dunham Morey Certified Public Accountant. 1961
(75) Director of MREIC. Owns 50,578 shs
Director 4.44%
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<PAGE>
Director Since/
Principal Occupation Shares Owned and
Name, Age and Title Past Five Years % of Total
Robert G. Sampson Self-employed investor. 1963
(70) Director of MREIC and UMH; Owns 16,986 shs
Director General Partner for Sampco, 1.49%
Ltd.
Peter J. Weidhorn President of WNY Management 1994
(49) Corp.; Vice Chairman, Owns 36,000 shs
Director CentraState Healthcare Systems, 3.16%
(1) Includes 4,722 shares held by Mr. Bencivenga's wife.
(2) Held jointly with Ms. Chew's husband.
(3) Includes (a) 3,621 shares held by Mr. DeBlasio's wife;
and (b) 9,574 shares in custodial accounts for Mr. DeBlasio's
children under the Uniform Gift to Minor's Act in which he
disclaims any beneficial interest, but has power to vote.
(4) Includes (a) 726 shares in joint name with Mrs. Kaempffer;
(b) 270 shares held by Mr. Kaempffer's wife; and (c) 7,000
shares held as Trustee for Defined Benefit Pension Plan for
which Mr. Kaempffer has power to vote.
(5) Includes (a) 6,698 shares held by Mr. Landy's wife;
(b) 24,010 shares held in the Landy & Landy Employees' Pension
Plan, of which Mr. Landy is a Trustee with power to vote; (c)
29,765 shares held in the Landy & Landy Employees'Profit Sharing
Plan of which Mr. Landy is Trustee with power to vote.
(6) Includes (a) 6,500 shares held by Mr. Landy's wife; and (b)
12,900 shares in the Samuel Landy Family Limited Partnership.
(7) Includes 57,310 shares held by Mitchell Partners, L.P. over
which Mr. Mitchell exercises voting power.
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<PAGE>
ITEM 11 - EXECUTIVE COMPENSATION
Summary Compensation Table
The following Summary Compensation Table shows compensation paid
by the Company to its chief executive officer for services rendered
during the fiscal years ending March 31, 1996, 1995 and 1994. Because
no executive officers received total annual salary and bonus exceeding
$100,000, only the compensation paid to the chief executive officer is
to be disclosed under the Securities and Exchange Commission disclosure
requirements.
Annual Compensation
Name and Principal
Position Year Salary Bonus Other(1)
Eugene W. Landy 1996 None None $63,530
Chief Executive Officer 1995 None None $55,545
1994 None None $47,350
(1) Represents directors' fees as well as legal and other fees to the
firm of Landy & Landy.
Overview and Philosophy
The Company has a Compensation Committee consisting of two
independent outside Directors. This Committee is responsible for
making recommendations to the Board of Directors concerning executive
compensation. The Compensation Committee takes into consideration
three major factors in setting compensation.
The first consideration is the overall performance of the Company.
The Committee believes that the financial interests of the executive
officers should be aligned with the success of the Company and the
financial interests of its shareholders.
The second consideration is the individual achievements made by
each officer. The Company is relatively small. The Committee is
aware of the contributions made by each officer and makes an
evaluation of individual performance based on their own familiarity
with the officer.
The final criteria in setting compensation is comparable wages
in the industry.
Evaluation
The Committee reviewed the progress made by Eugene W. Landy,
Chief Executive Officer, in locating alternative business and investment
opportunities. The Committee decided to recommend that Mr. Landy's annual
compensation be increased to $50,000 effective January 1, 1996. The
Summary Compensation Table shows an annual compensation to Mr.Landy of
$43,030 plus $20,500 in directors' and other legal fees for a total
of $63,530 for the year ended March 31, 1996.
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<PAGE>
Other Information
Except for specific agreements, the Company has no retirement plan
in effect for officers, directors or employees and, at present, has no
intention of instituting such a plan.
Comparative Performance by the Company
The following line graph compares the total return of the
Company's Common Stock for the last five fiscal years to the
NASDAQ Total Return Index and the NASDAQ Financial Stocks Total
Return Index. The total return reflects stock price appreciation
and dividend reinvestment for all three comparative indices. The
information herein has been obtained from sources believed to be
reliable, but neither its accuracy nor its completeness is
guaranteed.
Monmouth Capital NASDAQ NASDAQ
Corporation Total Financial
1991 100 100 100
1992 92 127 139
1993 81 147 198
1994 104 158 206
1995 95 176 231
1996 111 239 318
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<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
As of March 31, 1996, no person owned of record or was known
by the Company to beneficially own more than 5% of the shares,
except as follows:
Name and Address Shares Owned Percent
of Beneficial Owner Beneficially of Class
Eugene W. Landy
20 Tuxedo Road 142,735 12.53%
Rumson, NJ 07760
James E. Mitchell
611 Anton Blvd. 62,000 5.45%
Costa Mesa, CA 92626
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since the beginning of the Company's last fiscal year, there have
been no transactions or proposed transactions in which any of the
officers and directors have a material interest.
The only family relationship between any of the directors or
executive officers of the Company is that of Samuel A. Landy, director,
who is the son of Eugene W. Landy, president and a director of the
Company.
Eugene W. Landy and Samuel A. Landy are partners in the law firm
of Landy & Landy, which firm, or its predecessor firms, have been
retained by the Company as legal counsel since the formation of the
Company, and which firm the Company proposes to retain as legal
counsel for the current fiscal year.
The New Jersey Supreme Court has ruled that the relationship of
directors also serving as outside counsel is not per se improper,
but the attorney should fully discuss the issue of conflict with the
other directors and disclose it as part of the proxy statement so
that shareholders can consider the conflict issue when voting for or
against the attorney/director nominee.
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<PAGE>
Additional related party transactions are incorporated herein
by reference to Part IV, Item 14(a)(1)(vi), Note 10 of the Notes
to Consolidated Financial Statements - Payments to Affiliated
Persons and Related Party Transactions.
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<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS
ON FORM 8-K
(a) (1) The following Financial Statements are filed as part of
this report:
Page
(i) Independent Auditors' Report 19
(ii) Consolidated Balance Sheets as of
March 31, 1996 and 1995 20-21
(iii) Consolidated Statements of Income
for the years ended March 31, 1996,
1995 and 1994 22
(iv) Consolidated Statements of Shareholders'
Equity for the years ended March 31, 1996,
1995 and 1994 23
(v) Consolidated Statements of Cash Flows
for the years ended March 31, 1996, 1995
and 1994 24
(vi) Notes to Consolidated Financial Statements 25-32
(a) (2) Financial Statement schedules are omitted
for the reason that they are not required,
are not applicable, or the required
information is set forth in the financial
statements or notes thereto.
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<PAGE>
PART IV
(a) (3) The Exhibits set forth in the following index of Exhibits
are filed as a part of this Report.
Exhibit No. Description
(2) Plan of Acquisition, Reorganization, Arrangement,
Liquidation, or Succession - Not Applicable
(3) Articles of Incorporation and By-Laws - Reference
is hereby made to that filed with the Securities
and Exchange Commission with the Company's
Form 10-K/A No. 2 for the year ended March 31, 1994.
(4) Instruments Defining the Rights of Security
Holders, including Indentures - Not Applicable
(9) Voting Trust Agreement - Not Applicable
(10) Material Contracts - Not Applicable
(11) Statement re: Computation of Per Share Earnings -
Not Applicable
(12) Statement re: Computation of Ratios -
Not Applicable
(13) Annual Report to Security Holders, Form 10-Q or
Quarterly Report to Shareholders - Not Applicable
(16) Letter re: Change in Certifying Accountant -
Not Applicable
(18) Letter re: Change in Accounting Principles -
Not Applicable
(19) Previously Unfiled Documents - Not Applicable
(21) Subsidiaries of the Registrant - During fiscal
1994, the Registrant formed a wholly-owned
subsidiary, The Mobile Home Store, Inc. to
finance and sell manufactured homes. This
subsidiary was incorporated in the State of
New Jersey.
(22) Published Report re: Matters Submitted to Vote of
Security Holders - Not Applicable
(23) Consents of Experts and Counsel - Not Applicable
(24) Power of Attorney - Not Applicable
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<PAGE>
Exhibit No. Description
(27) Financial Data Schedule
(28) Information from Reports Furnished to State
Insurance Regulatory Authorities - Not Applicable
(29) Additional Exhibits - None
Reports on Form 8-K - None
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<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders
Monmouth Capital Corporation
Eatontown, New Jersey
We have audited the accompanying consolidated balance sheets
of Monmouth Capital Corporation as of March 31, 1996 and 1995,
and the related consolidated statements of income, shareholders'
equity and cash flows for each of the years in the three-year
period ended March 31, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects, the
financial position of Monmouth Capital Corporation at March 31,
1996 and 1995, and the results of its operations and its cash
flows for each of the years in the three-year period ended March
31, 1996 in conformity with generally accepted accounting
principles.
/s/ Cowan, Gunteski & Co.
May 20, 1996
Toms River, New Jersey
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<PAGE>
<TABLE>
<CAPTION>
MONMOUTH CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31,
ASSETS
1996 1995
<S> <C> <C>
Current Assets:
Cash $ 94,625 $ 205,804
Accounts Receivable 75,752 18,704
Interest Receivable 32,842 48,373
Securities Available for Sale at
Fair Value (cost $983,788 and
$1,013,250 at March 31, 1996 and
1995, respectively) 966,614 1,022,315
Inventory 1,168,216 448,116
Prepaid Expenses and Other Current Assets 56,290 62,727
Current Portion of Loans Receivable 523,021 500,569
__________ __________
Total Current Assets 2,917,360 2,306,608
__________ __________
Long Term Assets:
Real Estate Investments:
Land 172,000 172,000
Building and Improvements net of
accumulated depreciation of $37,487
and $12,492, respectively 937,213 962,208
__________ __________
Total Real Estate Investments 1,109,213 1,134,208
__________ __________
Loans Receivable:
Performing 1,436,625 853,640
Non-Performing (less allowance for
losses of $119,753 in 1996 and
1995.) 288,849 278,849
__________ __________
Total Loans Receivable 1,725,474 1,132,489
__________ __________
Securities Held to Maturity -0- 494,737
__________ __________
Total Long-Term Assets 2,834,687 2,761,434
__________ __________
TOTAL ASSETS $5,752,047 $5,068,042
========== ==========
See Accompanying Independent Auditors' Report and
Notes to Consolidated Financial Statements
</TABLE>
-20-
<PAGE>
<TABLE>
<CAPTION>
MONMOUTH CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS (CONTINUED)
AS OF MARCH 31,
LIABILITIES AND SHAREHOLDERS' EQUITY
1996 1995
<S> <C> <C>
Current Liabilities:
Accounts Payable and Accrued Expenses $ 240,801 $ 202,371
Loans Payable 726,587 319,040
__________ __________
Total Current Liabilities 967,388 521,411
Other Liabilities 77,904 69,341
__________ __________
TOTAL LIABILITIES 1,045,292 590,752
__________ __________
Shareholders' Equity:
Common Stock (par value $1.00 per
share; authorized 10,000,000 shares;
issued and outstanding 1,139,184 and
1,100,071 shares respectively in 1996
and 1995.) 1,139,184 1,100,071
Additional Paid-In Capital 2,662,555 2,596,172
Unrealized Investment Gain (Loss) (17,174) 9,065
Retained Earnings 922,190 771,982
__________ __________
Total Shareholders' Equity 4,706,755 4,477,290
__________ __________
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $5,752,047 $5,068,042
========== ==========
See Accompanying Independent Auditors' Report and
Notes to Consolidated Financial Statements
</TABLE>
-21-
<PAGE>
<TABLE>
<CAPTION>
MONMOUTH CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED MARCH 31,
1996 1995 1994
<S> <C> <C> <C>
INCOME:
Sales of Mobile Homes $1,724,021 $ 968,990 $ 117,553
Interest Income 360,076 198,743 297,032
Rental Income 174,879 162,998 -0-
Other Income 385,161 7,988 4,678
__________ _________ __________
Total Income 2,644,137 1,338,719 419,263
__________ _________ __________
EXPENSES:
Cost of Manufactured
Home Sales 1,397,389 648,836 74,423
Selling Expense 132,707 79,037 13,643
Salaries and Employee
Benefits 174,525 125,453 101,177
Professional Fees 136,908 95,426 78,381
Interest Expense 68,248 31,746 51,049
Other 357,473 169,169 92,483
__________ __________ __________
Total Expenses 2,267,250 1,149,667 411,156
__________ __________ __________
Income Before
Income Taxes 376,887 189,052 8,107
Income Taxes 171,308 87,200 5,286
_________ ________ _________
NET INCOME $ 205,579 $ 101,852 $ 2,821
========= ========= =========
NET INCOME PER SHARE $ .18 $ .16 $ .01
========= ========= =========
WEIGHTED AVERAGE
SHARES OUTSTANDING 1,111,624 646,693 510,680
========= ========= =========
See Accompanying Independent Auditors' Report and
Notes to Consolidated Financial Statements
</TABLE>
-22-
<PAGE>
<TABLE>
<CAPTION>
MONMOUTH CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Additional Unrealized
Common Stock Paid-In Investment Retained
Number Amount Capital Gain (Loss) Earnings
<S> <C> <C> <C> <C> <C>
Balance
March 31, 1993 510,680 $ 510,680 $1,572,567 $ -0- $ 810,300
Net Income -0- -0- -0- -0- 2,821
Distributions -0- -0- -0- -0- (117,457)
__________ _________ __________ _________ __________
Balance
March 31, 1994 510,680 510,680 1,572,567 -0- 695,664
Common Stock
Issued with
the Rights
Offering 589,391 589,391 1,023,605 -0- -0-
Net Income -0- -0- -0- -0- 101,852
Distributions -0- -0- -0- -0- (25,534)
Unrealized
Investment
Gain -0- -0- -0- 9,065 -0-
__________ _________ ___________ _________ __________
Balance
March 31,1995 1,100,071 1,100,071 2,596,172 9,065 771,982
Common Stock
Issued with
the Dividend
Reinvestment
and Stock
Purchase Plan 39,113 39,113 66,383 -0- -0-
Net Income -0- -0- -0- -0- 205,579
Distributions -0- -0- -0- -0- (55,371)
Unrealized
Investment
Loss -0- -0- -0- (26,239) -0-
_________ __________ ___________ _________ ___________
Balance
March 31,1996 1,139,184 $1,139,184 $ 2,662,555 $ (17,174) $922,190
========= ========== ========== ========= ========
See Accompanying Independent Auditors' Report and
Notes to Consolidated Financial Statements
</TABLE>
-23-
<PAGE>
<TABLE>
<CAPTION>
MONMOUTH CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31,
1996 1995 1994
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 205,579 $ 101,852 $ 2,821
Depreciation & Amortization 24,995 12,492 7,194
Changes in Operating Assets
and Liabilities:
Accounts Receivable (57,048) 2,282 22,411
Allowance for Losses -0- -0- (14,683)
Interest Receivable 15,531 (10,543) 24,568
Inventory (720,100) (282,603) (165,513)
Prepaid Expenses and Other
Current Assets 6,437 34,761 (50,584)
Accounts Payable and
Accrued Expenses 38,430 72,497 80,481
Other 8,563 39,733 11,809
__________ ___________ ___________
Net Cash Used by
Operating Activities (477,613) (29,529) (81,496)
__________ ___________ ___________
CASH FLOWS FROM INVESTING ACTIVITIES
New Loans (1,405,605) (644,634) -0-
Collections and Other
Decreases in Loans
Receivable 790,168 111,876 1,495,885
Purchase of Securities
Available for Sale -0- (1,003,125) (506,875)
Decrease in Securities
Available for Sale 524,199 11,161 1,091,007
Purchase of Real Estate
Investments -0- -0- (1,146,700)
Net Cash Provided (Used) __________ ___________ ___________
by Investing Activities (91,238) (1,524,722) 933,317
__________ ___________ ___________
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payments of
Notes and Debentures -0- -0- (1,000,000)
Net Increase in Loans
Payable 407,547 41,171 277,869
Dividends Paid (55,371) (25,534) (117,457)
Proceeds from Issuance of
Class A Common Stock 105,496 1,612 996 -0-
Net Cash Provided (Used) by __________ ___________ ___________
Financing Activities 457,672 1,628,633 (839,588)
__________ ___________ ___________
Net Increase (Decrease)
in Cash (111,179) 74,382 12,233
Cash at Beginning of Year 205,804 131,422 119,189
__________ ___________ ___________
Cash at End of Year $ 94,625 $ 205,804 $ 131,422
========== =========== ===========
See Accompanying Independent Auditors' Report and
Notes to Consolidated Financial Statements
</TABLE>
-24-
<PAGE>
MONMOUTH CAPITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1996
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of the Business
Monmouth Capital Corporation (the Company) is a corporation
organized in New Jersey which commenced operations in 1961. Until
1993, the Company was an investment company under the Investment
Company Act of 1940 and a small business investment company licensed
under the Small Business Investment Company Act of 1958. The Company
currently receives rental income from one real estate investment.
The Company also sells and finances manufactured homes.
Revenue Recognition
Sale of mobile homes is recognized on the full accrual basis
when certain criteria are met. These criteria include the following:
(a) initial and continuing payment by the buyer must be adequate;
(b) the receivable, if any, is not subject to future subordination;
(c) the benefits and risks of ownership are substantially transferred
to the buyer; and (d) the Company does not have a substantial continued
involvement with the home after the sale. Alternatively, when the
foregoing criteria are not met, the Company recognizes gains by the
installment method. Interest income on loans receivable is not
accrued when, in the opinion of management, the collection of such
interest appears doubtful. Rental income is recognized on the
straight-line basis over the term of the lease.
Building and Improvements
Building and Improvements are stated at the lower of depreciated
cost or net realizable value. Depreciation is computed based on the
straight-line method over the estimated useful life of the assets
(39 years).
Investments in Debt and Equity Securities
During 1994, the Company adopted Statement of Financial Accounting
Standards No. 115. Securities Held-to-Maturity are carried at amortized
cost. Securities Available-for-Sale are carried at fair value with
unrealized holding gains and losses are excluded from earnings and
reported as a separate component of Shareholders' Equity until realized.
Effective October 1, 1995, the Company reclassified its Securities Held
to Maturity to Securities Available for Sale.
Inventories
Inventories, consisting of manufactured homes for sale, are
valued at the lower of cost or market value and are determined
by the specific identification method. All inventories are
considered finished goods.
-25-
<PAGE>
Income Taxes
The Company has adopted Statement of Financial Accounting
Standards No. 109. Income taxes are accounted for by the asset/
liability method.
Earnings Per Share
Net income per share is computed using the weighted average number
of shares outstanding, adjusted for the exercise, or potential exercise,
of any dilutive outstanding stock options (See Note 6).
Recent Accounting Pronouncements
In March, 1995, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 121 "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of" (SFAS 121), which is effective for financial statements issued for
fiscal years beginning after December 15, 1995. The implementation of
SFAS 121 is not expected to have a material impact on the financial
position or results of operations of the Company.
Reclassifications
Certain amounts in the consolidated financial statements for
prior years have been reclassified to conform to the current year
presentation. These reclassifications have no effect on net
income.
NOTE 2 - INVESTMENT IN SUBSIDIARY
The Company formed a wholly-owned subsidiary, The Mobile Home
Store, Inc. (MHS), to finance and sell manufactured homes. MHS
was incorporated in the State of New Jersey on July 28, 1993. The
consolidated financial statements of the Company include the
accounts of MHS. All intercompany transactions and balances have
been eliminated in consolidation.
-26-
<PAGE>
NOTE 3 - LOANS RECEIVABLE
The following is a summary of the loans held by the Company
at March 31, 1996 and 1995:
Maturity Balance
Rate Date 3/31/96 3/31/95
J. Trombe Flooring Co.* 12% 1994 $ 408,602 $ 398,602
Motel Associates of
Columbus 13% 1994 381,320 391,884
ICS Acquisitions, Inc. 13.5% 1999 -0- 247,500
ICS Acquisitions, Inc. 13% 1999 -0- 50,000
Financed Manufactured
Home Units 10%-12% various 1,578,326 664,825
__________ __________
Total Loans Receivable 2,368,248 1,752,811
Allowance for Losses 119,753 119,753
__________ __________
Net Loans Receivable 2,248,495 1,633,058
Current Portion 523,021 500,569
__________ __________
Long-Term Portion $1,725,474 $1,132,489
========== ==========
* Non-performing loan
During 1994, MHS began selling manufactured home units and financing
these sales. At March 31, 1996 and 1995, financed manufactured home
units consist of fifty-six and twenty-two loans, respectively. These
loans range from approximately $5,000 to approximately $62,000 and are
collateralized by manufactured homes.
At March 31, 1996 and 1995, the Company had one loan which was
considered non-performing. The borrower has resumed making payments.
However, the Company has initiated foreclosure proceedings. Foregone
interest on non-performing loans amounted to $-0-, $19,930 and $52,840
for the years ended March 31, 1996, 1995 and 1994, respectively.
On April 25, 1995, ICS Acquisitions, Inc. repurchased its $50,000
subordinated convertible debenture for a purchase price of $396,291, a
gain of $346,291. This gain is included in Other Income. The purchase
price was to have been paid in quarterly installments over a five-year
period together with interest at prime plus two percent with a minimum
rate of 8% and a maximum rate of 13%. On January 4, 1996, ICS fully
repaid all of its debt obligations.
During April and May of 1995, an additional $19,000 was advanced to
Trombe Flooring, Inc. for improvements to the property.
-27-
<PAGE>
NOTE 4 - INVESTMENTS IN DEBT AND EQUITY SECURITIES
The following is a summary of investments in debt and equity
securities at March 31, 1996 and 1995:
Cost Carrying Value
Description 3/31/96 3/31/96 3/31/95
U.S.Treasury Notes, $500,000
CPJJ,7.5%,1/31/97 $501,562 $508,125 $1,012,190
Government National
Mortgage Association
6.5%, 2/20/1014 472,101 441,794 494,737*
Tork Time Control, Inc.
1,500 shares 10,125 16,695 10,125
________ ________ __________
$983,788 $966,614 $1,517,052
======== ======== ==========
*Classified as Securities Held to Maturity at March 31, 1995.
During 1996, the Company sold $500,000 of its investment in U.S.
Treasury Notes at a gain of $4,219. This gain was included in Other Income.
During 1996 and 1995, the Company purchased securities on margin.
This margin loan is due on demand. Interest is calculated based on the
Brokers Loan Rate plus 3/4%. At March 31, 1996 and 1995, the margin
loans amounted to $243,315 and $196,150, respectively. Interest rates
on these loans were at 8.50% and 9.25%, respectively.
NOTE 5 - INVENTORY FINANCING
On October 6, 1994, the Company entered into an agreement with
Deutsche Financial Services (formerly ITT Commercial Finance Corp.)
whereby MHS finances its inventory purchases under a $350,000 line of
credit. This amount was increased to $550,000 during fiscal 1996. The
interest rate is prime for each advance and prime plus 3% after one
year. At March 31, 1996, the Company had $483,272 outstanding and
$66,728 available on this line of credit. Advances under this line of
credit are secured by the manufactured home units for which the advances
were made.
NOTE 6 - EMPLOYEE STOCK OPTIONS
On July 14, 1994, the shareholders approved and ratified the
Company's 1994 Stock Option Plan authorizing the grant to officers and
key employees of options to purchase up to 300,000 shares of common stock.
Options may be granted any time up to December 31, 2003. No option shall
be available for exercise beyond ten years. All options are exercisable
after one year from the date of grant. The option price shall not be
below the fair market value at date of grant. Cancelled or expired
options are added back to the "pool" of shares available under the plan.
-28-
<PAGE>
As of March 31, 1996, there were 20,000 shares exercisable and
265,000 shares available under the plan. The following is a summary of
stock options outstanding as of March 31, 1996:
Date of Number of Number of Option Expiration
Grant Employees Shares Price Date
1/4/95 2 20,000 $3.00 1/4/2000
3/4/96 3 15,000 3.50 3/4/2001
______
35,000
======
In October, 1995, the Financial Accounting Standards Board issued
SFAS No. 123, "Accounting for Stock-Based Compensation". This Statement
establishes financial accounting and reporting standards for stock-based
employee compensation plans.
SFAS No. 123 provides for a "fair value based method" of accounting
for employees stock compensation plans. However, SFAS No. 123 allows an
entity to continue following APB Opinion No. 25 and thereby measuring
compensation cost under such plans using the "intrinsic value based
method" provided certain pro-forma footnote disclosure be made as if
the fair value based method was adopted.
On April 1, 1996, the Company elected to continue following APB
Opinion No. 25. The adoption of SFAS No. 123 will not have a material
impact on the results of operations or financial position of the Company.
NOTE 7 - RIGHTS OFFERING
During 1995, the Company completed a Rights Offering in which
the Company offered to sell to its shareholders two shares of common
stock for each share owned. The rights were exercisable at $3.00 per
share. The Company issued 589,173 shares of common stock resulting
in gross proceeds of $1,768,173. Net proceeds after expenses,
including solicitation fees and legal and other expenses, amounted
to $1,612,996.
NOTE 8 - DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
Effective August 28, 1995, the Company implemented a Dividend
Reinvestment and Stock Purchase Plan (DRIP). Under the terms of the DRIP,
shareholders who participate may reinvest all or part of their dividends
in additional shares of the Company at approximately 95% of the market
price.
Shareholders may also purchase additional shares at approximately 95%
of its market price by making optional cash payments. For the year ended
March 31, 1996, the Company received $105,496 from the DRIP. There were
39,113 new shares issued, resulting in 1,139,184 shares outstanding.
On December 15, 1995, the Company paid $55,371 as a dividend of $.05
per share to shareholders of record November 15, 1995.
-29-
<PAGE>
NOTE 9 - INCOME TAXES
For the years ended March 31, 1996, 1995 and 1994, total income tax
expense amounted to $171,308, $87,200 and $5,286,respectively.
The following is a reconciliation of income tax expense at
the statutory rate to income tax expense at the Company's effective
rate for the years ended March 31, 1996, 1995 and 1994, respectively:
1996 1995 1994
Computed tax at the expected
statutory rate $128,142 $64,278 $1,216
Surtax Exemption (11,750) (11,750) -0-
Deferred income/expenses 9,787 2,833 1,250
State income taxes - net of
federal tax benefits 30,563 27,687 2,243
Other 14,566 4,152 577
________ _______ ______
Income tax expense $171,308 $87,200 $5,286
======== ======= ======
There were no deferred tax assets or liabilities recognized as of
March 31, 1996, 1995 and 1994.
NOTE 10 - PAYMENTS TO AFFILIATED PERSONS AND RELATED PARTY
TRANSACTIONS
Payments to Affiliated Persons
Total payments to all officers, directors and affiliated
persons during the fiscal years ended March 31, 1996, 1995
and 1994 amounted to $103,816, $101,173 and $76,037, respectively.
Eugene W.Landy, President of the Company, received $45,030
$43,450, and $44,350 in management and director fees during the
years ended March 31, 1996, 1995 and 1994, respectively. In
addition, the firm of Landy & Landy received $18,500, $12,095 and
$3,000 in legal fees, respectively.
Peter J. Weidhorn, a director of the Company, is the chairman,
director and major shareholder of ICS Acquisitions, Inc. (ICS), in
which the Company had an investment since 1989. On April 28, 1995,
ICS repurchased its $50,000 convertible debenture for $396,291. On
January 4, 1996, ICS fully repaid its debt obligations to the
Company.(See Note 3 of the Notes to Consolidated Financial
Statements).
-30-
<PAGE>
Transactions with United Mobile Homes, Inc.
MHS has rental expenses to United Mobile Homes, Inc. (United).
United owns and operates manufactured home communities. Six
Directors of the Company are also Directors and shareholders of
United. MHS pays United market rent on sites where MHS has a home
for sale. Total site rental expense to United amounted to $54,321
and $8,066, respectively, for the years ended March 31, 1996 and
1995. Effective April 1, 1995, MHS and United entered into an
agreement whereby MHS leases space from United to be used as sales
lots, at market rates, at most of United's communities. Total
rental expense relating to these sales lots amounted to $89,950
for the year ended March 31, 1996
During fiscal 1996, MHS sold to United twelve homes for a
total sales price of $240,109 at MHS's cost. These sales
represented 12% of total sales made by MHS during the year.
These manufactured homes were available through MHS, but could
have been acquired by United from a third party at approximately
the same price.
During the years ended March 31, 1996 and 1995, MHS acquired
certain inventory from United. These purchases amounted to
$143,983 and $209,300 representing 7% and 22%, respectively, of
total purchases made by MHS during fiscal 1996 and 1995. This
inventory was available through United, but could have been acquired
from a third-party at approximately the same cost.
NOTE 11 - GROUP CONCENTRATIONS OF CREDIT RISK
The Company has made loans to small business concerns and to
individuals located throughout the Northeast region of the United
States. The loan portfolio is diversified. Generally, loans are
collateralized by commercial or residential real property,
including manufactured homes. At March 31, 1996 and 1995, all
loans were secured.
NOTE 12 - INVESTMENT COMPANY DEREGISTRATION
On October 1, 1992, the shareholders reaffirmed their approval
of the extension of a resolution authorizing the Board of Directors
to cause the Company to cease to be a Small Business Investment
Company. The Company surrendered its license to the Small Business
Administration (SBA) and filed a deregistration application with
the Securities and Exchange Commission (SEC). On January 15, 1993,
the SBA approved the surrender of the Company's license. On
July 20, 1993, the SEC accepted the Company's application to cease
to be an investment company.
-31-
<PAGE>
NOTE 13 - SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the years ended March 31, 1996, 1995 and
1994 for interest and taxes are as follows:
3/31/96 3/31/95 3/31/94
Interest $ 68,248 $ 31,746 $ 76,978
Taxes 142,135 (3,259) 53,926
NOTE 14 - FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company is required to disclose certain information about fair
values of financial instruments, as defined in Statement of Financial
Accounting Standards No. 107, "Disclosures About Fair Value of
Financial Instruments."
LIMITATIONS
Estimates of fair value are made at a specific point in time based
upon where available, relevant market prices and information about the
financial instrument. Such estimates do not include any premium or
discount that could result from offering for sale at one time the
Company's entire holdings of a particular financial instrument. For a
portion of the Company's financial instruments, no quoted market value
exists. Therefore, estimates of fair value are necessarily based on a
number of significant assumptions (many of which involve events outside
the control of management). Such assumptions include assessments of
current economic conditions, perceived risks associated with these
financial instruments and their counterparties, future expected loss
experience and other factors. Given the uncertainties surrounding
these assumptions, the reported fair values represent estimates only,
and, therefore, cannot be compared to the historical accounting model.
Use of different assumptions or methodologies is likely to result in
significantly different fair value estimates.
The fair value of cash and cash equivalents and loans receivable
approximates their current carrying amounts since all such items are
short-term in nature. The fair value of loans payable approximates
their current carrying amounts since such amounts payable are at a
current market rate of interest.
-32-
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MONMOUTH CAPITAL CORPORATION
Date: June 25, 1996 By: /s/Eugene W. Landy
EUGENE W. LANDY
President and Director
Pursuant to the requirements of the Securities and Exchange Act
of 1934, this report has been duly signed below by the following
persons on behalf of the registrant and in the capacities and on
the date indicated.
Date: June 25, 1996 By: /s/Boniface DeBlasio
Boniface DeBlasio,
Chairman of the Board
and Director
Date: June 25, 1996 By: /s/Eugene W. Landy
Eugene W. Landy, President
and Director
Date: June 25, 1996 By: /s/Ernest V. Bencivenga
Ernest V. Bencivenga,
Secretary/Treasurer
and Director
Date: June 25, 1996 By: /s/Anna T. Chew
Anna T. Chew, Controller and
Director
Date: June 25, 1996 By: /s/Charles P. Kaempffer
Charles P. Kaempffer, Director
-33-
<PAGE>
Date: June 25, 1996 By: /s/Samuel A. Landy
Samuel A. Landy, Director
Date: June 25, 1996 By: /s/James E. Mitchell
James E. Mitchell, Director
Date: June 25, 1996 By: /s/W. Dunham Morey
W. Dunham Morey, Director
Date: June 25, 1996 By: /s/Robert G. Sampson
Robert G. Sampson, Director
Date: June 25, 1996 By: /s/Peter J. Weidhorn
Peter J. Weidhorn, Director
-34-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF MONMOUTH CAPITAL CORPORATION AS OF AND FOR THE YEAR
ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 94,625
<SECURITIES> 966,614
<RECEIVABLES> 2,476,842
<ALLOWANCES> 119,753
<INVENTORY> 1,168,216
<CURRENT-ASSETS> 2,917,360
<PP&E> 1,146,700
<DEPRECIATION> 37,487
<TOTAL-ASSETS> 5,752,047
<CURRENT-LIABILITIES> 967,388
<BONDS> 0
0
0
<COMMON> 1,139,184
<OTHER-SE> 3,440,246
<TOTAL-LIABILITY-AND-EQUITY> 5,752,047
<SALES> 1,724,021
<TOTAL-REVENUES> 2,644,137
<CGS> 1,397,389
<TOTAL-COSTS> 444,140
<OTHER-EXPENSES> 357,473
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 68,248
<INCOME-PRETAX> 376,887
<INCOME-TAX> 171,308
<INCOME-CONTINUING> 205,579
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 205,579
<EPS-PRIMARY> .18
<EPS-DILUTED> .18
</TABLE>
