FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1996
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: 0-3338
NMC CORP.
(Exact name of registrant as specified in its charter)
Delaware 22-1558317
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
477 Madison Avenue, Suite 701
New York, New York 10022
(Address of principal executive offices)
(Zip Code)
212-207-4560
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(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.
At June 1, 1996 there were 986,677 shares of Common Stock, $.06 2/3 par
value, outstanding.
<PAGE>
NMC CORP.
INDEX
PAGE NO.
--------
Part I - Financial Information 1
Item 1. Financial Statements
Consolidated Balance Sheets as of
April 30, 1996 (unaudited) and
July 31, 1995 2 - 3
Consolidated Statements of Operations
for the Nine Months and Three Months
Ended April 30, 1996 and 1995
(unaudited) 4
Consolidated Statements of Cash Flows
for the Nine Months and Three Months
Ended April 30, 1996 and 1995
(unaudited) 5 - 6
Notes to Consolidated Financial
Statements (unaudited) 7 - 10
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 11 - 13
Part II - Other Information
Item 4. Submission of Matters to a Vote of
Security Holders 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
<PAGE>
PART I. Financial Information
Item 1. Financial Statements
Certain information and footnote disclosures required under
generally accepted accounting principles have been condensed or omitted from the
following consolidated financial statements pursuant to the rules and
regulations of the Securities and Exchange Commission. It is suggested that the
following consolidated financial statements be read in conjunction with the
year-end consolidated financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the year ended July 31, 1995.
The results of operations for the three and nine month period
ended April 30, 1996 are not necessarily indicative of the results to be
expected for the entire fiscal year or for any other period.
-1-
<PAGE>
NMC CORP. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
ASSETS
APRIL 30, JULY 31,
1996 1995
----------- -----------
(Unaudited)
Current Assets:
Cash $ 40,429 $ 14,043
Accounts receivable 414,213 152,196
Inventories 19,774 5,935
Prepaid expenses and sundry
receivables 74,581 39,250
----------- -----------
Total Current Assets 548,997 211,424
----------- -----------
Property, plant and equipment - net 1,077,920 147,696
Unamortized excess of cost over fair
value of assets acquired 1,000,775 853,850
Deferred acquisition costs 197,290 331,281
----------- -----------
TOTAL ASSETS $ 2,824,982 $ 1,544,251
=========== ===========
(Continued)
See notes to consolidated financial statements.
-2-
<PAGE>
NMC CORP. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
APRIL 30, JULY 31,
1996 1995
----------- -----------
(Unaudited)
Current Liabilities:
Short-term debt $ 1,151,722 $ 526,324
Current portion of long-term debt 26,904 6,047
Accounts payable 171,334 112,981
Accrued expenses 205,197 148,548
Customer deposits 89,525 16,000
Capital lease obligation 103,943 -
Deferred revenue 52,458 58,896
Due to officer 50,000 50,000
Income taxes payable 2,220 3,030
----------- -----------
Total Current Liabilities 1,853,303 921,826
----------- -----------
Long-term debt 27,216 6,047
Deferred revenues 9,074 13,166
----------- -----------
Total Liabilities 1,889,593 941,039
----------- -----------
Minority interest in consolidated
subsidiary 620,958 -
Stockholders' Equity:
Capital stock:
Preferred par value $1; authorized
500,000 shares (involuntary liquidation
value $777,912)
Convertible Series B, at redemption
value; issued and outstanding 65,141
shares 130,282 130,282
Cumulative Series C, par value $1,
issued and outstanding 64,763 shares 64,763 64,763
Common, par value $.06-2/3; authorized
20,000,000 shares; issued and outstanding
986,677 and 936,677 shares 65,811 62,476
Additional paid-in capital 7,358,419 7,351,643
Deficit (7,298,747) (7,029,559)
Foreign currency translation adjustment (6,097) 23,607
----------- -----------
Total Stockholders' Equity 314,431 603,212
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 2,824,982 $ 1,544,251
=========== ===========
See notes to consolidated financial statements.
-3-
<PAGE>
<TABLE>
NMC CORP. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
APRIL 30, APRIL 30,
------------------------- --------------------------
1996 1995 1996 1995
---------- ---------- --------- -----------
<S> <C> <C> <C> <C>
Revenues $ 882,839 $ 388,762 $ 369,494 $ 133,490
---------- ---------- --------- -----------
Costs and Expenses:
Cost of sales 165,488 95,398 60,451 17,927
Selling, general and
administrative expenses 891,830 579,876 343,247 189,197
Interest expense 102,614 7,585 32,300 1,947
Other (income) (9,337) (23,627) 680 130
---------- ---------- --------- -----------
1,150,595 659,232 436,678 209,201
---------- ---------- --------- -----------
(Loss) before income tax
provision and minority
interest (267,756) (270,470) (67,184) (75,711)
Minority interest in net
income of consolidated
subsidiary 1,432 - 1,432 -
---------- ---------- --------- -----------
(Loss) before income
tax provision (269,188) (270,470) (68,616) (75,711)
Income tax provision - 872 - 872
---------- ---------- --------- -----------
Net (loss) $ (269,188) $ (271,342) $ (68,616) $ (76,583)
========== ========== ========= ===========
(Loss) per common share $(.28) $(.52) $(.07) $(.11)
===== ===== ===== =====
Weighted average number
of common shares out-
standing 964,414 524,589 986,677 706,340
========== ========== ========= ===========
</TABLE>
See notes to consolidated financial statements.
-4-
<PAGE>
NMC CORP. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
NINE MONTHS ENDED
APRIL 30,
-------------------------
1996 1995
---------- ----------
Cash flows from operating activities:
Net (loss) $ (269,188) $ (271,342)
Adjustments to reconcile net (loss) to
net cash from operating activities:
Depreciation and amortization 163,594 118,885
Minority interest in income of consolidated
subsidiary 1,432 -
Gain on sale of equipment (9,337) -
Changes in operating assets and liabilities
net of effect from purchase of Water Express (257,716) 108,023
---------- ----------
Net Cash (used in) operating ativities (371,215) (44,434)
---------- ----------
Cash flows from investing activities:
Purchase of property, plant and equipment (156,270) (91,818)
---------- ----------
Cash flows from financing activities:
Proceeds from borrowings 770,026 201,661
Proceeds from minority shareholder 75,000 -
Repayments of borrowings (277,833) (41,369)
Proceeds from sale of equipment 16,382 -
---------- ----------
Net Cash provided by financing
activities 583,575 160,292
---------- ----------
Foreign currency translation adjustment (29,704) (557)
---------- ----------
Net increase in cash and cash equivalents 26,386 23,483
Cash and Cash Equivalents - beginning of
period 14,043 911
---------- ----------
Cash and Cash Equivalents - end of period $ 40,429 $ 24,394
========== ==========
(Continued)
See notes to consolidated financial statements
-5-
<PAGE>
NMC CORP. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Continued)
NINE MONTHS ENDED
APRIL 30,
----------------------------
1996 1995
---------- ----------
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable $ (24,372) $ 432
(Increase) decrease in inventories (10,639) 17,439
(Increase) in prepaid expenses and sundry
receivables (32,441) (13,998)
(Increase) in deferred acquisition
costs (207,241) -
(Increase) in other assets - 387
Increase (decrease) in accounts payable (12,641) 22,214
Increase (decrease) in accrued expenses 44,275 (29,966)
Increase (decrease) in income taxes
payable (810) 49
Increase (decrease) in deferred revenue (10,530) 11,466
(Decrease) in customer deposits (3,317) -
---------- ----------
$ (257,716) $ 108,023
========== ==========
Supplementary information of non-cash
investing and financing activities:
During 1995, Krystal Fountain Water
Company Limited purchased Water
Express. In connection with this
acquisition:
Fair value of assets acquired $1,260,110
==========
Liabilities assumed $ 360,399
==========
Common stock issued in consideration of
executive compensation $ - $ 250,000
========== ==========
Common stock issued in consideration of
consulting services $ - $ 133,400
========== ==========
Supplemental Information:
Cash paid during the year for:
Interest $ 33,777 $ 5,144
========== ==========
Income taxes $ 810 $ 94
========== ==========
See notes to consolidated financial statements.
-6-
<PAGE>
NMC CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The consolidated balance sheet as of April 30, 1996, the consolidated
statement of operations for the nine months ended April 30, 1996 and 1995, and
the statement of cash flows for the periods then ended have been prepared by NMC
Corp. and Subsidiary ("The Company" or "NMC") and are unaudited. In the opinion
of management, all adjustments (consisting solely of normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flows for all periods presented have been made. Certain
items in the April 30, 1995 financial statements have been reclassified to
conform to April 30, 1996 classifications. The information for July 31, 1995 was
derived from audited financial statements.
2. The Board of Directors authorized a 1-10 reverse stock split effective as of
April 17, 1995. All share and per share data for prior periods presented have
been restated to reflect the reverse stock split.
3. The accompanying consolidated financial statements have been prepared on a
going concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business.
The Company has experienced recurring losses and negative cash flows
from operations through April 30, 1996. In addition, losses and negative cash
flows from operations have continued throughout the period subsequent to April
30, 1996.
The Company's viability as a going concern is dependent upon its
ability to obtain additional financing. The Company has no operations other than
those relating to the Krystal Fountain Water Company Limited ("Krystal")
business which will provide the Company's only source of cash flow for the
foreseeable future. Management estimates that this cash flow should be
sufficient to support Krystal's operations during the next twelve (12) months.
On November 1, 1995, Krystal acquired substantially all of the net
assets of Water Express ("Water Express"), a company located in London, England.
Water Express is a company engaged in the sale of bottled water in five gallon
containers to be utilized in conjunction with water coolers, dispensing both hot
and cold water. It currently rents over 1,600 coolers to commercial
establishments in the London metropolitan market place. (See Note 7 of Notes to
Consolidated Financial Statements for further terms regarding the acquisition).
Krystal is negotiating to acquire various assets of a second water
distribution company located in the United Kingdom. The acquisition is subject
to the consummation of equity financing by the Company or Krystal.
The Company believes the cash flows from the Water Express acquisition
will be sufficient to fund operations in the future assuming the cash flows from
the Krystal operations can be used to pay for the cost of NMC's operations.
Should NMC use any funds from Krystal, the Company's fifty (50%) percent equity
partner of Krystal is entitled to an equal distribution.
-7-
<PAGE>
NMC CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
On December 8, 1995 NMC and Krystal entered into a loan agreement with
a foreign lender obtaining a line-of-credit up to $750,000. The loan is
guaranteed by the Company and is secured by an English debenture (Security
Agreement) from Krystal which covers all of Krystal's assets in favor of the
lender. The lien on this collateral is superior to prior liens given to other
lenders. At April 30, 1996, NMC and Krystal borrowed $528,000 against the
line-of-credit, including the affiliated entities. A bridge loan of $125,000 was
repaid in full and the balance was used for corporate purposes. The bridge loan
was used in acquiring Water Express. The loan is due on September 30, 1996 or
sooner if the Company or its subsidiary is able to secure financing in an amount
not less than the outstanding amount due to the lender. (See Note 6 of Notes to
Consolidated Financial Statements for further consideration given to the
lender).
The Company is currently negotiating a proposed public equity financing
with an investment banking firm but as of the date hereof, no letter of intent
or other document setting forth the terms of the transaction has been executed.
Accordingly, no assurance can be given that the financing will ever be
consummated. The Company believes the cash flow from the Krystal operations will
be sufficient to repay the line-of-credit. If the lender is not repaid in
accordance with the loan agreement, the Company will lose its only revenue
generating operations.
The Company also has a $200,000 loan due to an unaffiliated third party
on October 1, 1996. If the lender is not repaid in accordance with the loan
agreement, the Company could also lose its only revenue generating operations.
The Company believes it will have the resources to repay the lender at that
time.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts and
classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.
4. (Loss) per common share is computed using the weighted average number of
common shares outstanding during the year. The convertible preferred stock and
exercise of warrants are not considered common share equivalents for purposes of
the computation of earnings per share in each period presented because their
effect is antidilutive.
5. Property, plant and equipment consists of the following:
APRIL 30, JULY 31,
1996 1995
---------- ---------
Machinery and equipment $1,290,889 $ 251,787
Leasehold improvements 6,197 6,197
Master tapes 20,001 20,001
---------- ---------
1,317,087 277,985
Less accumulated depreciation and
amortization 239,167 130,289
---------- ---------
Net Property, Plant and Equipment $1,077,920 $ 147,696
========== =========
-8-
<PAGE>
NMC CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
6. DEBT
Short-term debt consists of the following:
APRIL 30, JULY 31,
1996 1995
---------- ---------
7.50% Note payable to Republic Bank,
due March 20, 1997, collateralized
by a certificate of deposit of an
affiliate of Barbara Greenfield,
wife of the Company's President and
Chief Executive Officer $ 100,000 $ 100,000
18% Note payable to Ballydine Investments
Limited due September 30, 1996, collater-
alized by all of the common stock of
Krystal owned by the Company 528,000 -
10% Note payable to a third party, due
October 1, 1996, collateralized by all of
the common stock of Krystal owned by the
Company subordinated to the line-of-credit 200,000 200,000
5% Note payable to Barbara Greenfield, due
on demand, collateralized by all of the
common stock of Krystal owned by the
Company. No demand may be made while the
line-of-credit is outstanding. The
security interest is subordinate to the
third party lender and the line-of-credit 197,229 199,672
5% Note payable to Matthew Mitchison
due on demand. No demand may be made
while the line-of-credit is outstanding 116,961 -
Various loans payable, due on demand
interest at 5% 9,532 26,652
---------- ---------
$1,151,722 $ 526,324
========== =========
Long-term debt consists of the following:
Note payable to a financial institution,
due July 1997, interest at 9%, colla-
teralized by transportation equipment $ 54,120 $ 12,094
Less current maturities 26,904 6,047
---------- ---------
Long-Term Debt $ 27,216 $ 6,047
========= =========
As additional consideration for the $750,000 line-of-credit, the
Company has issued 9.9% of the outstanding, fully diluted shares of the Company
in the form of a warrant exercisable at $.001 per share, with registration
rights, as the amount utilized is in excess of $500,000.
-9-
<PAGE>
NMC CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
7. On November 1, 1995, Krystal acquired substantially all the net assets of
Water Express, a water distribution company in the United Kingdom in exchange
for the issuance of 363,155 shares of the common stock of Krystal, approximately
$208,000 in cash, and a promissory note of approximately $125,000. The total
purchase price approximated $914,000. As of this date the Company's ownership
equity in Krystal has been reduced to fifty (50%) percent. The non-NMC interest
represents the minority stockholder's proportionate share of the equity of
Krystal. (See Note 3 of Notes to Consolidated Financial Statements for further
information).
The acquisition has been accounted for using the purchase method of
accounting, and, accordingly the purchase price was allocated to the assets
purchased and the liabilities assumed based upon the fair values at the date of
acquisition. The fair value of the assets acquired was $1,260,000 and the
liabilities assumed totalled $360,000 resulting in goodwill of approximately
$185,000, which will be amortized over three years. The operating results of the
acquired business is included in the consolidated statement of operations
from the date of acquisition. Proforma unaudited operating information for the
nine month period ended April 30, 1996 and 1995 of NMC and Water Express,
assuming the business combination had occurred at the beginning of the
respective year in which Water Express was acquired as well as the beginning of
the immediate preceding year is as follows:
NINE MONTHS ENDED
APRIL 30,
---------------------------------
1996 1995
---- ----
Net sales $1,313,784 $1,007,760
Net (loss) $ (168,841) $ (372,109)
Net (loss) per share $(.17) $(.71)
-10-
<PAGE>
Item 2. Managements' Discussion and Analysis of Financial Condition and
Results of Operations
RESULTS OF OPERATIONS
Nine Months April 30, 1996 vs. Nine Months April 30, 1995
The results of Krystal are included in the consolidated financial
statements of the Company from the date of acquisition. The Company has no
operations other than those relating to Krystal's business.
On November 1, 1995, Krystal acquired substantially all the net assets
of Water Express ("Water Express"), a water distribution company in the United
Kingdom. (See Liquidity and Capital Resources below for terms of the
acquisition). Water Express is a company engaged in the sale of bottled water in
five gallon containers to be utilized in conjunction with water coolers,
dispensing both hot and cold water. It currently rents over 1,600 coolers to
commercial establishments in the metropolitan London market place. The operating
results of Water Express have been included in the consolidated statement of
operations from the date of acquisition. Krystal is negotiating to acquire
various assets of a second water distribution company located in the United
Kingdom. This acquisition is subject to the consummation of equity financing by
the Company or Krystal, of which there can be no assurance.
Revenues from sales increased 127.1% to $882,839 during the nine months
ended April 30, 1996 from $388,762 for the nine months ended April 30, 1995. The
increase is primarily due to the inclusion of Water Express in the statement of
operations, an increase in the number of customers and more demand for the
Company's product.
Cost of sales increased 73.5% to $165,488 during the nine months ended
April 30, 1996 from $95,398 during the nine months ended April 30, 1995 due to
the reasons explained above.
Selling, general and administrative expenses increased 53.4% to
$891,830 for the nine months ended April 30, 1996 from $579,876 for the nine
months ended April 30, 1995 due to the reasons explained above.
Interest expense increased to $102,614 for the nine months ended April
30, 1996 from $7,585 for the nine months ended April 30, 1995. The increase is
attributable to the increase in debt incurred by the Company in the nine months
ended April 30, 1996 as discussed below in "Liquidity and Capital Resources".
Other income decreased 60.5% to $9,337 for the nine months ended April
30, 1996 from $23,627 for the nine months ended April 30, 1995 due to a
settlement received by Krystal for the infringement of its territorial rights by
a competitor during the nine months ended April 30, 1995. This event was a
non-recurring transaction.
The net loss of $269,188 remained relatively constant for the nine
months ended April 30, 1996 compared to the nine months ended April 30, 1995.
The Company attributes the small decrease primarily to the increase in interest
expense which is offset by the improvement in the operations of Krystal.
However, the operations of Krystal have not been able to offset the overhead of
the Company at its corporate offices.
-11-
<PAGE>
Three Months April 30, 1996 vs. Three Months April 30, 1995
Revenues from sales increased 176.8% to $369,494 during the three
months ended April 30, 1996 from $133,490 for the three months ended April 30,
1995. The increase is due to the reasons set forth in the nine month analysis.
Cost of sales increased 237.2% to $60,451 during the three months ended
April 30, 1996 from $17,927 for the three months ended April 30, 1995 due to the
reasons explained above.
Selling, general and administrative expenses increased 81.4% to
$343,247 for the three months ended April 30, 1996 from $189,197 for the three
months ended April 30, 1995. The increase is primarily due to the inclusion of
Water Express in the statement of operations and an increase in amortization
expenses to write off the deferred charges relating to the acquisition of Water
Express.
Interest expense increased to $32,300 for the three months ended April
30, 1996 from $1,947 for the three months ended 1995 due to the reason set forth
in the nine month analysis.
Other income increased to $680 for the three months ended April 30,
1996 from $130 for the three months ended April 30, 1995. The increase is due to
the gain on the sale of various equipment sold by Krystal in 1996.
The net loss of $68,616 decreased by approximately $7,967 for the three
months ended April 30, 1996 compared to the three months ended April 30, 1995
due to the reasons set forth in the nine month analysis.
LIQUIDITY AND CAPITAL RESOURCES
NMC currently has no operations other than those relating to Krystal's
business which will, therefore, provide the Company's only source of cash flow
for the foreseeable future. Management estimates that this cash flow should be
sufficient to support Krystal's operations during the next 12 months. This
estimate is based on existing water dispenser unit lease commitments and
projected water sales which, in turn, are based on historical per unit water
usage.
Krystal acquired substantially all the net assets of Water Express in
exchange for the issuance of 363,155 shares of the common stock of Krystal,
approximately $208,000 in cash, and a promissory note of approximately $125,000.
In order to make the cash payment, Krystal obtained bridge financing in the
amount of $125,000. The cash advances of $55,000 made previously to Water
Express was also applied as part of the down payment. As of this date the
Company's ownership equity in Krystal has been reduced to fifty (50%) percent.
Krystal is negotiating with Hydropure Group Limited ("Hydropure")
pursuant to which it would acquire various assets of Hydropure. Hydropure is a
distributor of natural spring mineral water for use with water coolers for
commercial establishments located within the Greater London area. It currently
services 2,200 customers. If the acquisition is consummated, Hydropure's
operations will be combined with those of Krystal.
-12-
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
Any agreement is subject to, among other things, the consummation of
the equity financing currently being negotiated between the Company and an
investment banking firm. The acquisition is anticipated to be completed no later
than September 30, 1996, if at all.
On December 8, 1995 NMC and Krystal entered into a loan agreement with
a foreign lender obtaining a line-of-credit up to $750,000. The loan is
guaranteed by the Company and is secured by an English debenture (Security
Agreement) from Krystal which covers all of Krystal's assets in favor of the
lender. This collateral is superior to previous collateral of Krystal given to
other lenders. At April 30, 1996, NMC and Krystal borrowed $528,000 against the
line-of-credit. The bridge loan of $125,000 was repaid in full and the balance
was used for corporate purposes. The loan is due on September 30, 1996 or sooner
if the Company or its subsidiary is able to secure financing in an amount not
less than the outstanding amount due to the lender.
On March 15, 1995, the Company entered into a secured loan agreement in
the amount of $200,000 with a third party, secured by all of the common stock of
Krystal owned by the Company. The loan is due October 1, 1996 with interest
accruing at ten (10%) percent per year. In consideration for the loan, the
Company issued to the lender a warrant to purchase up to 100,000 shares of
Common Stock at $1.00 per share. The loan enabled the Company to finance its
operations through the end of the previous fiscal year.
The Company has experienced severe cash flow deficiencies from
operations. To alleviate these problems, the Company has received advances from
certain lenders including Barbara Greenfield, the wife of the Company's
President and Chief Executive Officer, Treasurer and Director. An affiliate of
Mrs. Greenfield has also collateralized a $100,000 loan made by a bank to the
Company with a certificate of deposit. The Company has given a security interest
in the shares of Krystal owned by the Company as collateral to Mrs. Greenfield,
which is second to the unaffiliated third party and the line-of-credit lender.
The Company believes the cash flows from the Water Express acquisition
will be sufficient to fund operations in the future assuming the cash flows from
its Krystal operations can be used to pay for the cost of NMC's operations.
Should NMC use any funds from Krystal, the Company's fifty (50%) percent equity
partner of Krystal is entitled to an equal distribution.
-13-
<PAGE>
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
None.
(b) There were no Current Reports on Form 8-K filed by
the registrant during the quarter ended April 30,
1996.
-14-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed in its behalf by the
undersigned thereunto duly authorized.
NMC CORP.
----------------------------------------
(Registrant)
Date: June 13, 1996 By: /s/ Marvin Greenfield
----------------------------------------
Marvin Greenfield, President and
Treasurer Duly Authorized Officer of the
Registrant (Principal Financial Officer)
-15-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
NMC CORP.
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NMC CORP.
AND SUBSIDIARY FINANCIAL STATEMENTS AT APRIL 30, 1996 AND THE NINE MONTHS
THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1996
<PERIOD-END> APR-30-1996
<CASH> 40,429
<SECURITIES> 0
<RECEIVABLES> 414,213
<ALLOWANCES> 0
<INVENTORY> 19,774
<CURRENT-ASSETS> 548,997
<PP&E> 1,317,087
<DEPRECIATION> 239,167
<TOTAL-ASSETS> 2,824,982
<CURRENT-LIABILITIES> 1,853,303
<BONDS> 0
0
257,521
<COMMON> 65,811
<OTHER-SE> 53,575
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</TABLE>
