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 quarter period ended March 31, 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 0-15355
J.A.M., INC.
(Exact name of registrant as specified in its charter)
NEW YORK 16-1092174
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
530 WILLOWBROOK OFFICE PARK, FAIRPORT, NEW YORK 14450
(Address of principal executive offices)
(716) 385-6740
(Registrant's telephone number, including area code)
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 and 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 __________
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
MARCH 31, 1996: 15,274,447 SHARES.
-1-
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
J.A.M., INC.
Balance Sheets
As of March 31, 1996 with Comparative Amounts for December 31, 1995
________________________________________________________________________
<TABLE>
<CAPTION>
03/31/96 12/31/95
<S> <C> <C>
(UNAUDITED) (AUDITED)
Current Assets:
Cash and cash equivalent $4,289 $4,705
Trade accounts receivable, less allowance for 346,261 288,126
doubtful accounts of $1,747 in 1995 and $3,600 in
1994
Inventories 3,206 2,988
Prepaid expenses 0 6,380
Total current assets 353,756 302,199
Fixed Assets:
Property, plant and equipment 773,763 729,440
Less: accumulated depreciation and amortization 570,979 560,631
Total Fixed Assets 202,784 168,809
Other Assets:
Deposits 11,133 11,219
TOTAL ASSETS $567,673 $482,227
</TABLE>
-2-
J.A.M., INC.
Balance Sheets
As of March 31, 1996 with Comparative Amounts for December 31, 1995
__________________________________________________________________________
<TABLE>
<CAPTION>
03/31/96 12/31/95
<S> <C> <C>
(UNAUDITED) (Audited)
Current Liabilities:
Loan - Officer $136,557 $146,175
Loan - Other 170,000 290,000
Loan - Bank 50,000 0
Accounts payable, trade 108,600 87,535
Accrued expenses 101,265 138,975
Accrued income tax (5) 349
Total current liabilities 566,417 663,034
Long-Term Liabilities:
Loan - Bank 91,666 0
Total long term liabilities 91,666 0
Stockholders' Equity:
Common stock, $.01 par value. 152,745 152,745
Authorized 16,000,000 shares; issued and outstanding
15,274,447 in 1995 and 12,274,447 shares in 1994
Additional paid-in capital 3,147,227 3,147,227
Accumulated deficit (3,390,382) (3,480,779)
Total stockholders' equity (90,410) (180,807)
TOTAL LIABILITIES AND EQUITY $567,673 $482,227
</TABLE>
-3-
J.A.M., INC.
Statements of Operations
For the Three-Month Interim Period Ended
March 31, 1996 with Comparative Amounts to March 31, 1995
____________________________________________________________________
<TABLE>
<CAPTION>
Quarter Quarter
<S> <C> <C>
Ended Ended
03/31/96 03/31/95
(UNAUDITED) (Unaudited)
Net sales $555,779 $133,492
Cost of sales 264,671 144,597
Gross profit $291,108 $(11,105)
Selling, general, and administrative expenses 190,183 131,426
Operating profit (loss) $100,925 $(142,531)
Other income (expense):
Interest income 0 0
Interest expense (10,783) (14,884)
$(10,783) $(14,884)
Net earnings (loss) before income taxes $90,142 $(157,415)
Income taxes 0 0
Net earnings (loss) $90,142 $(157,415)
Net earnings (loss) per common share, $0.01 $(0.01)
based upon the weighted average common
shares outstanding during each period
Weighted average number of shares 15,274,447 12,274,447
</TABLE>
-4-
J. A.M., Inc.
Statements of Cash Flows
For the Three-Month Interim Period Ended
March 31, 1996 with Comparative Amounts to March 31, 1995
_____________________________________________________________________
<TABLE>
<CAPTION>
Three Three
<S> <C> <C>
Months Months
Ended Ended
03/31/96 03/31/95
(UNAUDITED) (Unaudited)
Cash flow from operating activities:
Net earnings (loss) $90,142 $(157,415)
Adjustment to reconcile net income to net
cash provided by (used in) operating
activities:
Depreciation and amortization 10,348 9,009
Change in assets and liabilities:
(Increase) decrease in:
Trade accounts receivable (58,135) 180,425
Inventories (217) (471)
Prepaid expenses 6,379
Increase (decrease) in:
Accounts payable, trade, accrued, and
withheld payroll taxes 74,390 (71,355)
Accrued expenses (106,626) 20,720
Billings in excess of costs and estimated
earnings on uncompleted contracts 0 (19,262)
Loans Payable (64,493) 65,754
Net cash provided by (used in) operations (48,212) $27,405
Cash flows from investing activities:
Capital expenditures $(44,239) $43,954
Net cash used in investing activities $(44,239) $43,954
</TABLE>
(continued)
-5-
J.A.M., Inc.
Statements of Cash Flows
For the Three-Month Interim Period Ended
March 31, 1996 with Comparative Amounts to March 31, 1995
______________________________________________________________________
<TABLE>
<CAPTION>
Three Three
<S> <C> <C>
Months Months
Ended Ended
03/31/96 03/31/95
(UNAUDITED) (Unaudited)
Cash flows from financing activities:
Prior Year End Adjustments 369 $(41,835)
Proceeds from long term debt 91,666 0
Net cash provided by (used in) $92,035 $(41,835)
financing activities
Net increase (decrease) in cash $(416) $29,524
and cash equivalents
Cash and cash equivalents at beginning of period $4.705 $(34,370)
Cash and cash equivalents at end of period $4,289 $(4,846)
Supplemental disclosure of cash flow information:
Cash paid during period for:
Interest $10,783 $14,884
Income taxes $374 $0
</TABLE>
-6-
J.A.M., Inc.
Notes to Financial Statements
March 31, 1996 and 1995
(1) MANAGEMENT'S REPRESENTATION
The information furnished herein reflects all adjustments which are, in the
opinion of management, necessary to a fair statement of the results for
the interim period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
OPERATIONS
Net sales for the first quarter 1996 increased 416% from the same period in
1995 to $555,779. This $422,287 increase from $133,492 for the comparable 1995
quarter was due to continued efforts in custom development of interactive
multimedia training programs.
At the end of the first quarter, there was approximately $450,000 of backlog.
LIQUIDITY
Earnings of $90,142 for the first quarter of 1996 increased the Company's
equity to $(90,410), compared to $(562,855) as of March 31, 1995. At March 31,
1996, the Company did not have any working capital. Cash on hand totaled
$4,289. Net trade receivables, less allowance for doubtful accounts of
$1,747, totaled $346,261 at the end of the first quarter.
The Company acknowledges that it does not have sufficient resources to continue
operations if operating losses occur anytime in 1996. Additional resources
of capital may be necessary to fund operations.
The Company has converted a bank line of credit which it secured in the fourth
quarter 1995 to a long term note. The Company is continuing its efforts to
negotiate with several financial institutions for a line of credit as well as
seeking other sources for financing.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
See Exhibit Index
(b) Reports on Form 8-K:
There were no reports on Form 8-K filed during the quarter ended March 31,
1996.
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.
J.A.M., INC.
(Registrant)
Dated: April 26, 1996 /s/ John A. Marszalek
John A. Marszalek Chairman
of the Board and
Chief Executive Officer
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description Location
27 Financial Data Schedule Filed only with EDGAR
filing, per Reg. S-K,
Rule 601(c)(1)(v)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FOLLOWING SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S MARCH 31, 1996 FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000765449
<NAME> J.A.M., INC.
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-1-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 4,289
<SECURITIES> 0
<RECEIVABLES> 348,008
<ALLOWANCES> 1,747
<INVENTORY> 3,206
<CURRENT-ASSETS> 353,756
<PP&E> 773,763
<DEPRECIATION> 570,979
<TOTAL-ASSETS> 567,673
<CURRENT-LIABILITIES> 566,417
<BONDS> 91,666
0
0
<COMMON> (90,410)
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 567,673
<SALES> 555,779
<TOTAL-REVENUES> 555,779
<CGS> 264,671
<TOTAL-COSTS> 454,854
<OTHER-EXPENSES> 10,783
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,783
<INCOME-PRETAX> 90,142
<INCOME-TAX> 0
<INCOME-CONTINUING> 90,142
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 90,142
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
</TABLE>
