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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
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: 0-11586
INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
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(Exact name of registrant as specified in its charter)
Pennsylvania 23-0350710
- ------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
810 Lombard Street
Philadelphia, Pennsylvania 19147
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(Address of principal executive offices) (Zip Code)
(215) 923-6850
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(Registrant's telephone number including area code)
N/A
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(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 issuers shares of
common stock, as of the latest practicable date: As of June 30th, 1997, there
were outstanding 12,760,140 shares of the Registrant's Common Stock, $.005 par
value.
Page 1 of 9 pages
Exhibit Index is on Page 9
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INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
INDEX
Page
Number
PART I FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets:
June 30, 1997 and December 31, 1996 3
Consolidated Statements of Loss:
Three and Six Months Ended June 30, 1997 and 1996 4
Consolidated Statements of Accumulated Deficit:
Six Months Ended June 30, 1997 and 1996 5
Consolidated Statements of Cash Flows:
Six Months Ended June 30, 1997 and 1996 6
Note to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II OTHER INFORMATION
Item 1. Legal Proceedings 8
Item 6. Exhibits and Reports on Form 8-K 8
Signatures
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INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
CONSOLIDATED BALANCE SHEETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets
Unaudited
JUNE 30 DECEMBER 31
1997 1996
----------- -----------
<S> <C> <C>
Current assets
Cash $ 141,424 $ 7,138
Note Receivable 37,000 37,000
----------- -----------
Total assets $ 178,424 $ 44,138
=========== ===========
Liabilities and Shareholders' Deficit
Current liabilities
Accounts payable and accrued expenses $ 417,177 $ 395,286
Due to affiliate 174,119 15,677
----------- -----------
Total current liabilities 591,296 410,963
----------- -----------
Shareholders' deficit
Common stock - $.005 par value, 50,000,000
shares authorized 12,760,140 shares
issued and outstanding 63,801 63,801
Capital in excess of par value 1,072,812 1,072,812
Accumulated deficit (1,549,485) (1,503,438)
----------- -----------
Total shareholders' deficit (412,872) (366,825)
----------- -----------
Total liabilities and
shareholders' deficit $ 178,424 $ 44,138
=========== ===========
</TABLE>
The accompanying note is an integral part of these financial statements.
3
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INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
CONSOLIDATED STATEMENTS OF LOSS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
-------------------------- --------------------------
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenue
Sale of medical devices $ -- $ 29,125 $ -- $ 11,609
--------- --------- --------- ---------
Direct expenses
Costs of goods - medical devices -- 16,166 -- 13,111
--------- --------- --------- ---------
Gross profit -- 12,959 -- (1,502)
--------- --------- --------- ---------
Other expenses
Expenses of development stage subsidiary
Professional fees 17,751 41,665 13,751 18,044
Other development stage expenses -- 208,835 -- 118,388
--------- --------- --------- ---------
Total expenses of development
stage subsidiary 17,751 250,500 13,751 136,432
General and administrative expenses 29,062 38,021 17,512 17,732
--------- --------- --------- ---------
Total other expenses 46,813 288,521 31,263 154,164
--------- --------- --------- ---------
Investment and other income (expense)
Investment income -- -- -- --
Interest income 765 -- 383 --
Other income -- 75 -- --
--------- --------- --------- ---------
Total investment and other income 765 75 383 --
--------- --------- --------- ---------
Net loss ($ 46,047) ($275,487) ($ 30,880) ($155,666)
========= ========= ========= =========
Loss per common share outstanding ($ .0036) ($ .0216) ($ .0024) ($ .0132)
========= ========= ========= =========
</TABLE>
The accompanying note is an integral part of these financial statements.
4
<PAGE> 5
INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
CONSOLIDATED STATEMENTS OF ACCUMULATED DEFICIT
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
--------------------------------
1997 1996
------------ -------------
<S> <C> <C>
BALANCE - BEGINNING OF THE PERIOD ($ 1,503,438) ($10,739,061)
NET (LOSS) GAIN FOR THE PERIOD (46,047) (275,487)
----------- -----------
BALANCE - END OF THE PERIOD ($ 1,549,485) ($11,014,548)
=========== ===========
</TABLE>
The accompanying note is an integral part of these financial statements.
5
<PAGE> 6
INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
1997 1996
--------- ---------
<S> <C> <C>
Cash flows from operating activities
Net income (loss) ($ 46,047) ($275,487)
--------- ---------
Adjustments to reconcile net loss to net cash used in
operating activities
Depreciation and amortization 0 2,670
Change in
Accounts receivable 0 4,802
Inventory 0 4,195
Prepaid expenses and other current assets 0 1,621
Accounts payable and accrued expenses 21,891 72,010
Due to affiliate 158,442 0
--------- ---------
Total adjustments 180,333 85,298
--------- ---------
Net cash provided by (used in) operating activities 134,286 (190,189)
--------- ---------
Cash flows from financing activities
Principal payments of notes payable -- (231,000)
Proceeds from issuance of Preferred Stock on consolidated subsidiary -- 365,000
--------- ---------
Net cash provided by (used in) financing activities -- 134,000
--------- ---------
Net increase (decrease) in cash and cash equivalents 134,286 (56,189)
Cash and cash equivalents, beginning 7,138 84,156
--------- ---------
Cash and cash equivalents, ending $ 141,424 $ 27,967
========= =========
</TABLE>
The accompanying note is an integral part of these financial statements.
6
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INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997
Note 1 - The unaudited financial statements presented herein have been prepared
in accordance with the instructions to Form 10-Q and do not include all
of the information and note disclosures required by generally accepted
accounting principles. These statements should be read in conjunction
with the financial statements and notes thereto included in the
Company's Form 10-K annual report for the year ended December 31, 1996.
In the opinion of management, these financial statements include all
adjustments, consisting only of normal recurring adjustments, necessary
to summarize fairly the Company's financial position and results of
operations. The results of operations for the six-month period ended
June 30, 1997 may not be indicative of the results that may be expected
for the year ending December 31, 1997.
Note 2 - The 1996 consolidated financial statements include the accounts of
International Management & Research Corporation and its wholly-owned
subsidiary - IMRC Holdings, Inc. (IMRCH). In accordance with guidelines
established by the United States Securities and Exchange Commission,
the 1996 financial statements prior to the period ending September 30,
1996 also include the accounts of Biosonics, Inc., which the Company
had majority ownership of until September 1996. All intercompany
balances and transactions have been eliminated.
7
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
Liquidity and Capital Resources
During the period ending September 30, 1996, Biosonics increased its authorized
shares and issued new shares to numerous individuals, primarily in exchange for
debt, and from the conversion of preferred stock, IMRCH's ownership of common
stock of Biosonics decreased to less than 50%. The Company through its wholly
owned subsidiary IMRCH owned 110,138,930 shares or 38.26% of Biosonics, Inc.
common stock. Accordingly IMRC is no longer able to consolidate with Biosonics'
financial statements. Financial statements prior to the period of September 30,
1996 include consolidated financial statements with Biosonics, Inc.
The Company is essentially a holding company. Except for certain management
services provided to Biosonics, the company presently conducts no business of
its own. Aside from payment of salary to an officer of the Company and certain
overhead expenses, substantially all of the consolidated results of operations
in 1996 relate to the operations of Biosonics. As previously noted, the
Company's 1997 financial statements do not include the accounts of Biosonics.
As a holding company, the Company does not have any substantial assets other
than common stock of Biosonics.
Results of Operations
The Company had no operating activities except for certain services provided in
connection with IMRCH's holding of Biosonics' common stock.
IMRC loaned $17,000 to a non-affiliated party of the company, thereby generating
interest income at 9% per annum, in lieu of this loan.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
*3.1 Articles of Incorporation (Exhibit to Registrant's
Registration Statement on Form 10 ["Form 10"]).
*3.5 By-laws of Registrant, as amended. (Exhibit to Registrant's
Form 10)
27. Financial Data Schedule
(b) Reports on Form 8-K:
The Registrant did not file any reports on Form 8-K during the quarter
ended June 30, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunder duly authorized.
INTERNATIONAL MANAGEMENT &
RESEARCH CORPORATION
Date: August 14 , 1997 By: /s/Jack Paller
------------------------ -----------------------------
Jack Paller, President, Chairman
(Principal Executive Officer),
Principal Financial Officer and
Principal Accounting Officer and
Sole Director
9
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<ARTICLE> 5
<CIK> 0000740892
<NAME> INTERNATIONAL MANAGEMENT & RESEARCH CORPORATION
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<CASH> 141,424
<SECURITIES> 0
<RECEIVABLES> 37,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 178,424
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 178,424
<CURRENT-LIABILITIES> 591,296
<BONDS> 0
0
0
<COMMON> 63,801
<OTHER-SE> (412,872)
<TOTAL-LIABILITY-AND-EQUITY> 178,424
<SALES> 0
<TOTAL-REVENUES> 765
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 46,813
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,314
<INCOME-PRETAX> (46,047)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (46,047)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
