SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 10-QSB
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For The Three Months Ended March 31, 1997
Commission file number:2-85175W
ELECTRO-KINETIC SYSTEMS, INC.
(Name of small business issuer in its charter)
PENNSYLVANIA 22-1954716
(State or other jurisdiction of (I.R.S. EmployerIdentification No.)
incorporation or organization)
270 Rocky Run Road, Glen Gardner New Jersey 08826
(Address of principal executive offices) (Zip Code)
Issuer's telephone number 908-537-4378
Securities registered pursuant to section 12(b) of the Act: None
Securities registered pursuant to section 12(g) of the Act:
Class A Common Stock
(Title of class)
Check whether issuer (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 ___.
Number of shares of Class A Common Stock, no par value, issued as of
March 31, 1997: 30,166,069 (Common Stock outstanding 20,431,069 and to be issued
9,735,000)
Transitional Small Business Disclosure Format
Yes ___ No _X_.
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations The following discussion should be read in conjunction
with the selected financial data and the financial statements appearing
elsewhere in this report.
Management Report General
Following the bankruptcy of its principal distributor in March 1995,
the Company suspended all operations related to radon testing and analysis of
environmental hazards. In 1996, the Company abandoned its efforts in the
magazine publishing field.
Results of Operations
The only recurring item of income (loss) is the Company's equity in its 50%
owned subsidiary, Printone Media.
Liquidity and Capital Resources
Working capital declined as a result of operating expenses for the
three months ended March 31, 1997 in the amount of $4,300 and from the
reclassification of the amounts due to officers of $56,314 from long term to
current liabilities.
For the Company to become a viable entity, it must operate profitably
and raise sufficient capital to fund its operations. The Company is making
continuing efforts in this regard but there is no assurance of success.
The Company previously acquired certain preliminary designs for
potential developments of computer decision models for trading securities and in
the fields of medical compliance and book publishing. It is currently seeking
financing to continue the developments as well as to enter into strategic
partnerships with other companies in these and related fields. There is no
assurance of success in these endeavors.
<PAGE>
PART 11 - OTHER INFORMATION
Item 1: Legal Proceedings:
NONE
Item 2: Changes in Securities:
There have been no instruments defining the rights of any holder of any
class of any registered security which has been materially modified.
Item 3: Defaults upon Senior Securities:
NONE
Item 4: Submission of matters to a vote of Security Holders:
NONE
Item 5: Other Information:
NONE
Item 6: Exhibits and reports of form 8-K:
See Reports filed on 01/03/96 and 01/11/96.
<PAGE>
ELECTRO-KINETIC SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1997
ASSETS
MARCH DECEMBER
31, 1997 31, 1996
--------- ----------
Current Assets:
Cash $ 0 $ 0
Other Receivables 0 0
Equipment Held for Sale 9,000 9000
-------- --------
Total Current Assets $ 9,000 $ 9,000
Other Assets
Excess of Cost over Net Assets Acquired,
Less Accumulated Amortization 17,571 18,036
Investment and Advances to 50% Owned
Affiliate 148,439 160,939
Organization Costs 300 300
-------- --------
Total Other Assets $166,310 $179,275
Total Assets $175,310 $188,275
======== ========
F-1
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ELECTRO-KINETIC SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1997
LIABILITIES AND SHAREHOLDERS' EQUITY
MARCH DECEMBER
31, 1997 31, 1996
---------- ----------
Current Liabilities
Accounts Payable $ 60,968 $ 59,968
Accrued Exp and other Current 18,920 17,920
Notes Payable 46,614 44,881
Due to Officer 56,881 0
----------- -----------
Total Current Liabilties $ 183,383 $ 122,769
----------- -----------
Long-Term Liabilities
Due to Officer $ 0 $ 56,314
----------- -----------
Total Long-Term Liabilities $ 0 $ 56,314
----------- -----------
Total Liabilities $ 183,383 $ 179,083
Stockholders' Equity
Class "A" Common Shares, No Par Value; $ 3,446,308 $ 3,446,308
Authorized - 90,000,000 shares Issued
and to be issued - 30,166,069 in 1997
28,086,098 in 1996
Additional Paid-In-Capital $ 52,293 $ 52,293
Accumulated Deficit ($3,506,674) ($3,489,409)
----------- -----------
Total Shareholders' Equity ($ 8,073) $ 9,192
Total Liabilities & Shareholders' Equity $ 175,310 $ 188,275
=========== ===========
F-2
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ELECTRO-KINETIC SYSTEMS INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE QUARTER ENDED MARCH 31, 1997
THREE MONTHS ENDED MARCH 31
1997 1996
-------- --------
Equity in Earnings of
Unconsolidated Affiliate ($ 12,500) ($ 9,560)
------------ ------------
($ 12,500) ($ 9,560)
Selling, General & Admin
Expenses $ 2,000 $ 2,094
Depreciation/Amortization 465 $ 0
------------ ------------
$ 2,465 $ 2,094
Net Loss From
Continuing Operations ($ 14,965) ($ 11,654)
------------ ------------
Other income (expense)
Interest Expense (2,300) (678)
Reduction of Previously
Recorded Liability
Forgiveness of Debt
------------ ------------
($ 2,300) ($ 678)
------------ ------------
Operating Loss ($ 17,265) ($ 12,332)
Loss Per Class A Common
Share
Net Loss ($ 0.001) ($ 0.001)
============ ============
Weighted Average Number
of Common Shares
Outstanding 29,126,069 23,748,212
============ ============
F-3
<PAGE>
ELECTRO-KINETIC SYSTEMS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31
1997 1996
----------- --------
Cash Flows From Operating Activities
Net Income ($17,265) ($12,332)
Adjustments to Reconcile Net Loss
to Net Cash Used in Operating Activities
Equity in Earnings of Unconsolidated
Subsidiary $ 12,500 $ 9,560
Depreciation and Amortization $ 465
(Increase) Decrease in Assets
Other Receivables ($ 1,000)
Increase (Decrease) in Liabilities
Accounts Payable - Trade $ 1,000 $ 1,506
Accrued Expenses and Other Current
Liabilities $ 1,000 ($11,615)
Notes Payable $ 1,733 $ 5,430
-------- --------
Total Adjustments $ 4,198 ($ 5,679)
-------- --------
Net Cash Provided/Used in Operating
Activities ($ 567) ($ 8,451)
Cash Flows From Financing Activities
Loans - Officers $ 567 $ 248
-------- --------
Net Cash Provided by Financing Activities $ 567 $ 248
-------- --------
Net Increase (Decrease) in Cash $ 0 ($ 8,203)
Cash - Beginning of Year $ 0 $ 13,147
-------- --------
Cash - End of Year $ 0 $ 4,944
======== ========
F-4
<PAGE>
ELECTRO-KINETIC SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
MARCH 31,1997
Common Shares
And Paid In
Common Shares Capital Deficit Total
----------- ------------- ----------- ----------
Balance at 30,166,069 $ 3,498,601 ($3,489,409) $ 9,192
January 1, 1997
Net Loss -- -- (17,265) (17,265)
----------- ----------- ----------- -----------
Balance at 30,166,069 $ 3,498,601 ($3,506,674) ($ 8,073)
March 31, 1997
Balance at
January 1, 1996 28,086,069 $ 3,472,801 ($3,359,492) $ 113,309
Net loss (12,332) ($ 12,332)
----------- ----------- ----------- -----------
Balance at
March 31, 1996 28,086,069 3,472,801 (3,371,824) $ 100,977
F-5
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 ( d ) of the
Securities Exchange Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly authorized:
ELECTRO-KINETIC SYSTEMS, INC.
Dated : __________________ By:__________________________________
Julius Cherny, PhD., President
Pursuant to the requirements of the Securities and Exchange Act of 1934, this
report has been signed below by the following person(s) on behalf of the
Registrant and in the capacities indicated and on the Dates indicated.
SIGNATURE CAPACITY DATED
_____________________________ Chairman of the ___________
Julius Cherny, PhD. Board, Director (DATE)
