FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1997
2-96366-A
(Commission File Number)
VANDERBILT SQUARE CORP.
(Exact name of Registrant as specified in its charter)
Florida 59-2483405
(State of other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
2300 Glades Road, Suite 450, West Tower, Boca Raton, FL 33431
(Address of Principal Executive Offices)
(561) 750-7200
(Registrant's Telephone Number, including area code)
3040 East Commercial Blvd., Ft. Lauderdale, FL 33308
(Former name, former address and former fiscal years,
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports 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
There were 16,490,756 shares of Common Stock, $.0001 par value, issued and
outstanding at November 14, 1997.
<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - September 30, 1997 (Unaudited)
and December 31, 1996.
Consolidated Statement of Operations - Three months and nine
months ended September 30, 1997 and 1996 (Unaudited).
Consolidated Statement of Shareholders' Equity - December 31,
1993 through September 30, 1997.
Consolidated Statement of Cash Flows - Nine months ended
September 30, 1997 and 1996 (Unaudited).
Notes to Consolidated Financial Statements.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security-Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
PART I - FINANCIAL INFORMATION
Item I. Financial Statements
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS
September 30, December 31,
1997 1996
(Unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 201,786 $ 250,209
Notes receivable - current:
Affiliate - 38,478
Other - 20,544
Investment in marketable
trading securities - at market 10,905 443,067
Accounts receivable - other - 4,334
Accrued interest receivable 263 143
Net investment in direct
financing leases - current - 3,453
Prepaid income taxes 6,000 3,749
TOTAL CURRENT ASSETS 218,954 763,977
INVESTMENT IN UNCONSOLIDATED
SUBSIDIARY - 250,008
NOTES RECEIVABLE - NON-CURRENT
Affiliate - 34,347
Other - 6,733
NET INVESTMENT IN DIRECT FINANCING
LEASES - non-current - 8,854
TOTAL ASSETS $ 218,954 $1,063,919
</TABLE>
See accompanying notes to consolidated financial statements.
-4(a)-
<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
September 30, December 31,
1997 1996
(Unaudited)
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable and accrued
expenses $ 4,000 $ 40,109
Deferred income taxes - current - 8,338
TOTAL CURRENT LIABILITIES 4,000 48,447
DEFERRED INCOME TAXES - NON-CURRENT - 3,226
4,000 51,673
SHAREHOLDERS' EQUITY:
Common stock $.0001 par value;
authorized 50,000,000 shares;
issued 16,490,756 shares at
September 30, 1997 and
December 31, 1996; outstanding
16,490,756 shares at
September 30, 1997 and
16,398,356 at December 31, 1996 1,649 1,649
Additional paid-in capital 1,137,363 1,137,363
Retained earnings (deficiency) (924,058) (116,734)
214,954 1,022,278
Less treasury stock - 92,400 shares
at December 31, 1996 - (10,032)
214,954 1,012,246
TOTAL LIABILITIES & SHAREHOLDER'S
EQUITY $ 218,954 $1,063,919
</TABLE>
See accompanying notes to consolidated financial statements.
-4(b)-
<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
REVENUES:
Interest and dividend income $ 9,755 $ 8,726 $ 27,415 $ 26,457
Realized and unrealized
gain (loss) on invest-
ment in marketable
trading securities 109,148 (2,687) 100,712 264,829
Direct finance lease income 140 274 604 728
119,043 6,313 128,731 292,014
OPERATING EXPENSES:
General and
administrative expenses 44,743 21,457 78,396 84,263
INCOME (LOSS) FROM OPERATIONS 74,300 (15,144) 50,335 207,751
OTHER INCOME (EXPENSES):
Equity in earnings (loss)
of unconsolidated subsidiary 63,183 3,148 49,890 50,689
Loss on disposition of subsidiary (5,988) - (5,988) -
INCOME (LOSS) BEFORE INCOME TAXES 131,495 11,996 94,237 258,440
PROVISION (CREDIT) FOR INCOME TAXES (15,092) - (12,592) 77,000
NET INCOME (LOSS) $ 146,587 $ 11,996 $ 106,829 $ 181,440
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING 16,490,756 14,979,555 16,490,756 14,540,641
NET INCOME PER COMMON SHARE $ .01 $ - $ .01 $ .01
</TABLE>
See accompanying notes to consolidated financial statements.
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
FROM DECEMBER 31, 1993 THROUGH SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
Common Stock
$.0001 Par Value Additional Retained
Auth. 50,000,000 Shares Paid-In Earnings Treasury
Shares Amount Capital (Deficit) Stock Total
<S> <C> <C> <C> <C> <C> <C>
Balance - December 31, 1993 14,633,750 $ 1,499 $970,557 $(17,361) $(19,643) $935,052
Purchase of Treasury Shares (204,000) - - - (16,596) (16,596)
Net income for the period - - - 6,642 - 6,642
Balance - December 31, 1994 14,429,750 1,499 970,557 (10,719) (36,239) 925,098
Purchase of Treasury Stock (826,900) - - - (71,477) (71,477)
Sale of Treasury Stock 333,000 - - - 24,981 24,981
Net income for the period - - - 1,498 - 1,498
Balance - December 31, 1995 13,935,850 1,499 970,557 (9,221) (82,735) 880,100
10% Stock Dividend 1,499,156 150 166,806 (166,956) - -
Purchase of Treasury Stock (249,100) - - - (33,070) (33,070)
Sale of Treasury Stock 1,212,450 - - - 105,773 105,773
Net income for the period - - - 59,443 - 59,443
Balance - December 31, 1996 16,398,356 1,649 1,137,363 (116,734) (10,032) 1,012,246
Sale of Treasury Stock 92,400 - - - 10,032 10,032
Dividend distribution - - - (914,153) - (914,153)
Net income for the period - - - 106,829 - 106,829
Balance - September 30, 1997 16,490,756 $ 1,649 $1,137,363 $(924,058) $ -0- $ 214,954
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1997 1996
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 106,829 $ 181,440
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
(Gain) loss on sale of
marketable securities 5,015 (265,025)
Equity in (earnings) or loss
of unconsolidated subsidiary (49,890) (50,689)
Allowance for market decline
of securities 10,866 197
Income from disposed subsidiaries (109,636) -
Gain on disposition of subsidiaries 5,988 -
Changes in operating assets and liabilities:
(Decrease) in accounts
payable and accrued expenses (36,109) (34,818)
(Increase) Decrease in accrued
interest receivable (120) 1,037
(Increase) decrease in
accounts receivable 1,841 24,456
(Decrease) Increase in income
taxes payable (2,251) 66,693
Proceeds from sale of marketable
trading securities 156,020 632,013
Purchase of marketable trading
securities - (440,007)
Decrease in deferred income taxes (11,564) -
Net cash provided by (used in)
operating activities 76,989 115,297
CASH FLOWS FROM INVESTING ACTIVITIES:
Principal collections of loans
to affiliates 25,000 11,177
Advance paid on notes receivable - other - (9,250)
Principal collections of notes
receivable - other - 26,718
Principal collections of direct
financing leases - 2,558
Purchase of equipment for lease - (7,100)
Investment in unconsolidated subsidiaries (171,924) (18,119)
Proceeds from sale of investment in
unconsolidated subsidiaries 21,512 4,753
Net cash provided by
(used in) investing activities (125,412) 10,737
</TABLE>
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1997 1996
<S> <C> <C>
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS $ (48,423) $ 126,034
CASH AND CASH EQUIVALENTS -
BEGINNING OF PERIOD 250,209 197,182
CASH AND CASH EQUIVALENTS -
END OF PERIOD $ 201,786 $ 323,216
</TABLE>
See accompanying notes to consolidated financial statements.
-7(b)-
<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
NOTE 1 - FAIR PRESENTATION
The consolidated balance sheet as of September 30, 1997, the consolidated
statement of operations for the three months and nine months ended September
30, 1997 and 1996, the consolidated statement of shareholders' equity as of
September 30, 1997, and the consolidated statement of cash flows for the nine
months ended September 30, 1997 and 1996, have been prepared by the Company
without audit. In the opinion of management, all adjustments necessary to
present fairly the financial position and results of operations at September
30, 1997 and for all periods presented have been made.
The operations for the nine months ended September 30, 1997 are not
necessarily indicative of the results of operations to be expected for the
Company's fiscal year.
The condensed financial statements as of December 31, 1996, 1995 and 1994 have
been derived from audited financial statements.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these
condensed financial statements be read in conjunction with the consolidated
financial statements and notes thereto as of December 31, 1996 and for the
year then ended.
NOTE 2 - BASIS OF PRESENTATION
The consolidated financial statements include the accounts of Vanderbilt
Square Corp. and its wholly-owned subsidiaries, Hi-Tech Leasing, Inc. and
Professional Programmers, Inc. The consolidated statement of operations
includes the results of the subsidiaries' operations through the date of their
disposition, July 31, 1997 (Hi-Tech Leasing, Inc.), and September 30, 1997
(Professional Programmers, Inc.). All significant intercompany accounts and
transaction have been eliminated in consolidation.
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
NOTE 3 - DIRECT FINANCING LEASES
The net investment in direct financing leases consists of the gross amount of
the lease, net of deferred interest and allowance for doubtful accounts.
NOTE 4 - EARNINGS (LOSS) PER SHARE
Per share information was computed using the weighted average number of common
shares outstanding during the reporting periods. Per share information
computed to be less than one cent is not shown on the accompanying financial
statements.
NOTE 5 - INVESTMENT IN MARKETABLE TRADING SECURITIES
Marketable trading securities are stated at market value at the balance sheet
date. Market values of investments in marketable trading securities amounted
to $10,905 at September 30, 1997, and $443,067 at December 31, 1996. The cost
of these investments is $40,180 and $420,584 respectively. Unrealized gains
and losses resulting from fluctuations in the market price of the related
securities are currently reflected in the consolidated statement of operations
under the caption "Realized and unrealized gain (loss) on marketable trading
securities".
NOTE 6 -OTHER INFORMATION
On July 28, 1997, the Company sold all of the issued and outstanding capital
stock of Hi-Tech Leasing, Inc. to Corrections Services, Inc. ("CSI") in
exchange for 2,000,000 shares of CSI's authorized but previously unissued
restricted Common Stock.
On August 26, 1997, the Company distributed 2,803,446 shares of its CSI
restricted Common Stock to its shareholders. The ratio of the distribution
was 0.17 shares of CSI restricted Common Stock for each share of the Company
Common stock. No fractional shares were issued or cash distributed in lieu of
fractional shares. One (1) full share of CSI Common Stock was distributed for
each fractional share remaining.
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
NOTE 6 -OTHER INFORMATION (Cont'd)
On August 27, 1997, Norman Becker, the Registrant's President and a director,
and Diane Aquino, the Registrant's Secretary/Treasurer and a director resigned
as officers and directors of the Registrant, and Larry Schwartz ("Schwartz"),
and Edward Meyer ("Meyer") were appointed as all of the members of the
Registrant's Board of Directors. Additionally, Schwartz was appointed
President and Meyer was appointed Secretary/Treasurer of the Registrant.
In addition, Schwartz has entered into option agreements with the former
officers and directors of the Registrant, pursuant to which Schwartz has been
granted the right until January 15, 1998, to purchase an aggregate of
3,500,000 shares of the Registrant's Common Stock from such former officers
and directors of the Registrant at $.10 per share.
In four unrelated transactions, four current stockholders of the Registrant
sold an aggregate of 2,000,000 shares of the Registrant's Common Stock at $.15
per share to three unrelated purchasers. The purchasers of these shares are
not affiliated with Schwartz or Meyer or affiliated with one another.
On September 9, 1997, the Company entered into a preliminary Letter of Intent
to acquire all of the issued and outstanding capital stock of Michael's
International Treasure Jewelry, inc., a closely-held Florida corporation with
several operating locations in the cities of Miami and Key West, Florida.
NOTE 7 - SUPPLEMENTAL CASH FLOW INFORMATION
Disposition of Subsidiaries - The Company received Common Stock with a fair
value of $731,000 in exchange for its investment in Hi-Tech Leasing, Inc.
The Company settled a $16,152 obligation to an affiliate through the
conveyance of 100% of its interest in Professional Programmers, Inc.
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<PAGE>
VANDERBILT SQUARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
NOTE 7 - SUPPLEMENTAL CASH FLOW INFORMATION (Contd.)
Shareholders' Equity - On August 26, 1997, The Company distributed investment
stock to common stock shareholders as a dividend. Fair value of the stock
amounted to $914,153.
NOTE 8 - SUBSEQUENT EVENT
On October 1, 1997, the Company entered into a one year Lease/Purchase
Agreement with Seahawk Deep Ocean Technology, Inc. ("Lessor") and Michael's
International Treasure Jewelry, Inc. ("Co-Lessee") for the "Dry Tortugas
Treasure" (the "Treasure"). The Lease/Purchase Agreement obligates Seahawk to
lease the Treasure to the Co-Lessees for a term of one (1) year. The lease
provides for quarterly payments of $67,500 and a buy-out after one (1)year
purchase price of $2,500,000 through payment of $750,000 in cash and
Vanderbilt Square Common Stock. The Treasure has been appraised at $5,200,000
and will be displayed at Michael's flagship store at 400 Duval Street in Key
West, Florida. Pursuant to the informal co-lessee agreement between Michael's
International Treasure Jewelry, Inc. and the Company, Michael's International
Treasure Jewelry, Inc. will make the quarterly lease payments. The Company's
interest in the lease is focused on the lessee's right to purchase the
Treasure at lease end at what it views as a very favorable purchase price.
The Company is not itself bound to make any of the quarterly lease payments.
If Michael's International Treasure Jewelry, Inc. fails to make subsequent
quarterly lease payments, the Company may however elect to do so to protect
its interest in the buy-out right. There is no present assurance that the
Company will be able to exercise the co-lessee's buy-out right at lease end in
any event. The initial quarterly lease payment was made by Michael's
International Treasure Jewelry, Inc.
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<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The analysis of the Company's financial condition, liquidity, capital
resources and results of operations should be reviewed in conjunction with the
accompanying financial statements, including the notes thereto.
Financial Condition
At September 30, 1997, the Company had current assets of $218,954, compared to
$763,977 at December 31, 1996; total assets of $218,954 as compared to
$1,063,919 at December 31, 1996; current liabilities of $4,000 as compared to
$48,447 at December 31, 1996, and a current net worth of $214,954 as compared
to $1,012,246 at December 31, 1996. (See "Financial Statements"). The
decrease in total assets and net worth are principally due to the Company's
disposal of its investments in subsidiaries Hi-Tech Leasing, Inc. and
Professional Programmers, Inc. and the August 26, 1997 distribution of its
investment in Corrections Services Inc. to the Company's shareholders. See
Financial Statements Note 7.
Liquidity
During the nine months ended September 30, 1997, the Company had a decrease in
cash and cash equivalents of $(48,423). The Company's decrease in cash was
principally attributed to the disposal of its investment in Hi-Tech Leasing,
Inc. and Professional Programmers, Inc. The Company believes it has
sufficient cash and cash equivalents to meet its current liquidity
requirements.
The Company has limited liabilities and no present commitments that are likely
to result in its liquidity increasing or decreasing in any material way. The
Company believes that it has sufficient funds to meet current liquidity
needs. In addition, other than the potential need to make one or more
quarterly lease payments under the certain lease to which the Company is
co-lessee, the Registrant knows of no trend, additional demand, event or
uncertainties that will result in, or that are reasonably likely to result in,
the Company's liquidity increasing or decreasing in any material way. See
Item 5.g., Other Information.
Capital Resources
The Company has no outstanding credit lines or credit commitments in place and
has no current need for financial credit. In the event of any future need,
the Company is uncertain that it will be able to borrow at prevailing terms
through loans collateralized, if necessary, by its assets.
The Company has no current material commitments for capital expenditures. The
Company entered into a preliminary letter of intent to acquire a closely
held treasure jewelry company, Michael
-12-
<PAGE>
International Treasure Jewelry, Inc., for cash and previously unissued Common
Stock. See Item 5.f., Other Information. The transaction contemplated is
contingent on the Company's ability to negotiate and execute a definitive
agreement. Other than the potential cash component of that possible
acquisition, the Company knows of no material trends, favorable or
unfavorable, in the Registrant's capital resources.
Results of Operations
The Company's revenues for the nine months ended September 30, 1997, and
September 30, 1996, were principally derived from interest income and activity
related to marketable securities transactions.
The Company's revenues for the nine months and three months ended September
30, 1997, was $128,731 and $119,043 as compared to $292,014 and $6,313 for the
comparable periods last year. The principal reason for the decrease in
revenues for the nine months and ended September 30, 1997 was the decrease in
gain on investment in marketable trading securities. The principal reason for
the increase in revenues for the three months ended September 30, 1997 was an
increase in gain on investment in marketable trading securities.
Operating expenses decreased to $78,396 for the nine months ended September
30, 1997, as compared to $84,263 for the comparable period last year.
Operating expenses increased to $44,743 for the three months ended September
30, 1997 as compared to $21,457 for the comparable period last year. Income
before provision for income taxes for the nine months ended September 30, 1997
was $94,237 as compared to income of $258,440 for the same period last year.
The decrease in income of $164,203 is principally due to a decrease in gain on
investment in marketable securities of $164,117, and the disposition of the
Company's investment in its wholly-owned subsidiary, Hi-Tech Leasing, Inc.
Registrant knows of no trends or uncertainties that have had, or that the
Company reasonably expects will have a materially favorable or unfavorable
impact on net sales or revenues or income from continuing operations.
- -13-
<PAGE>
PART II
Item 1. LEGAL PROCEEDINGS
Not applicable.
Item 2. CHANGES IN SECURITIES
Not applicable.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
Not applicable.
Item 5. OTHER INFORMATION
a. On July 28, 1997, the Company sold all of the issued and
outstanding capital stock of Hi-Tech Leasing, Inc. to
Corrections Services, Inc. ("CSI") in exchange for 2,000,000
shares of CSI's authorized but previously unissued restricted
Common Stock.
b. On August 26, 1997, the Company distributed 2,803,446 shares of
its CSI restricted Common Stock to its stockholders. The ratio
of distribution was 0.17 shares of CSI restricted Common Stock
for each share held of the Company's Common stock. No
fractional shares were issued or cash distributed in lieu of
fractional shares. One (1) full share of CSI Common Stock was
distributed for each fractional share remaining.
c. On August 27, 1997, Norman Becker, the Registrant's President
and a director, and Diane Aquino, the Registrant's Secretary/
Treasurer and a director resigned as officers and directors of
the Registrant, and Larry Schwartz ("Schwartz"), and Edward
Meyer ("Meyer") were appointed as all of the members of the
Registrant's Board of Directors. Schwartz was then appointed
President and Meyer was appointed Secretary/Treasurer of the
Registrant.
d. In addition, Schwartz entered into option agreements with the
former officers and directors of the Registrant, pursuant to
which he has been granted the right, until January 15, 1998, to
purchase an aggregate of 3,500,000 shares of the Registrant's
Common Stock from the former officers and directors at $.10
per share.
-14-
<PAGE>
e. In four unrelated transactions, four current stockholders of
the Registrant sold an aggregate of 2,000,000 shares of the
Registrant's Common Stock at $.15 per share to three
unrelated purchasers. The purchasers of these shares are not
affiliated with Schwartz or Meyer or affiliated with one
another.
f. On September 9, 1997, the Company entered into a preliminary
Letter of Intent to acquire all of the issued and outstanding
capital stock of Michael's International Treasure Jewelry,
Inc., a closely-held Florida corporation with several
operating locations in the cities of Miami and Key West,
Florida.
g. On October 1, 1997, the Company entered into a one year Lease/
Purchase Agreement with Seahawk Deep Ocean Technology, Inc.
("Lessor") and Michael's International Treasure Jewelry,
Inc. ("Co-Lessee") for the "Dry Tortugas Treasure" (the
"Treasure"). The Lease/Purchase Agreement obligates Seahawk to
lease the Treasure to the Co-Lessees for a term of one (1)
year. The lease provides for quarterly payments of $67,500
and a buy-out after one (1) year purchase price of
$2,500,000 through payment of $750,000 in cash and Vanderbilt
Square Common Stock. The Treasure has been appraised at
$5,200,000 and will be displayed at Michael's flagship store
at 400 Duval Street in Key West, Florida. Pursuant to the
informal co-lessee agreement between Michael's International
Treasure Jewelry, Inc. and the Company, Michael's International
Treasure Jewelry, Inc. will make the quarterly lease payments.
The Company's interest in the lease is focused on the lessee's
right to purchase the Treasure at lease end at what it views as
a very favorable purchase price. The Company is not itself
bound to make any of the quarterly lease payments. If
Michael's International Treasure Jewelry, Inc. fails to make
subsequent quarterly lease payments, the Company may however
elect to do so to protect its interest in the buy-out right.
There is no present assurance that the Company will be able
to exercise the co-lessee's buy-out right at lease end in
any event. The initial quarterly lease payment was made by
Michael's International Treasure Jewelry, Inc. Michael's
International Treasure Jewelry, Inc. expects to garner
additional retail revenues through its display of the
Treasure to more than make the quarterly lease payments.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
The Registrant filed three (3) Current Reports on Form 8-K during this
reporting period on the following dates:
July 28, 1997
September 2, 1997
September 9, 1997
-15-
<PAGE>
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 thereunto duly authorized.
VANDERBILT SQUARE CORP.
Date: November 21, 1997 BY:/s/Larry Schwartz
Larry Schwartz, President
- -16-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Balance
Sheet, Statement of Operations, Statements of Cash flows and Notes thereto
incorporated in Part I, Item 1. of this Form 10-Q and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 201,786
<SECURITIES> 10,905
<RECEIVABLES> 263
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 218,954
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 218,954
<CURRENT-LIABILITIES> 4,000
<BONDS> 0
0
0
<COMMON> 1,649
<OTHER-SE> 213,305
<TOTAL-LIABILITY-AND-EQUITY> 218,954
<SALES> 0
<TOTAL-REVENUES> 128,731
<CGS> 0
<TOTAL-COSTS> 78,396
<OTHER-EXPENSES> 5,988
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 94,237
<INCOME-TAX> (12,592)
<INCOME-CONTINUING> 106,829
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 106,829
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
