SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter year ended: Commission file number:
April 30,1998 0-14200
------------- --------
CompuSonics Video Corporation
(Exact name of Registrant as specified in its charter)
Colorado 84-1001336
------------------------------- -------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
7001 Orchard Lake Road - Suite 424
West Bloomfield, MI 48322-3608
---------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(248) 851-5651
Securities registered pursuant to Section 12 (b) of the Act:
None
Securities registered pursuant to Section 12 (g) of the Act:
Common Stock, $.001 Par Value
(Title of Class)
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 and, (2) has been subject to such filing requirements
for the past 90 days: Yes X No
As of June 3, 1998, a total of 160,006,250 shares of common stock, $.001 par
value, were outstanding.
<PAGE>
COMPUSONICS VIDEO CORPORATION & SUBSIDIARIES
Form 10-Q Filing for the Quarter Ended April 30,1998
INDEX
Page
Number
------
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements.
Consolidated Balance Sheets
April 30, 1998 (Unaudited) and July 31, 1997 3
Consolidated Statements of Operations (Unaudited)
Three and Nine months ended April 30,1998
and 1997 4
Consolidated Statements of Cash Flows (Unaudited)
Nine months ended April 30,1998 and 1997 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 7
Signature Page 8
<PAGE>
COMPUSONICS VIDEO CORPORATION & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
------------------------------
04/30/98 07/31/97
----------- -----------
<S> <C> <C>
Current Assets
Cash $ 41 $ 153
Marketable Securities Available
For Sale 84,535 67,628
----------- -----------
$ 84,576 $ 67,781
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Notes Payable to Related Entities $ 392,440 $ 390,590
Notes Payable - Other 20,100 20,100
Accounts Payable and Accrued Liabilities 43,593 37,791
Accounts Payable - Related Entities 254,405 223,701
----------- -----------
710,538 672,182
----------- -----------
Stockholders' Deficit
Preferred Stock - Series A Convertible Stock
$.001 Par Value, 75,000,000 Shares
Authorized, -0- Shares Issued and Outstanding -0- -0-
Common Stock $.001 Par Value, 300,000,000
Shares Authorized, 160,006,250 Shares
Issued and Outstanding 160,006 160,006
Additional Paid-In Capital 680,880 680,880
Retained Earnings
Unrealized Gain on Available for Sale Securities 59,500 42,593
Accumulated Deficit (1,526,348) (1,487,879)
----------- -----------
(625,962) (604,401)
----------- -----------
$ 84,576 $ 67,781
=========== ===========
</TABLE>
See notes to financial statements
3
<PAGE>
<TABLE>
<CAPTION>
COMPUSONICS VIDEO CORPORATION & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the three months ended April 30, For the nine months ended April 30,
---------------------------------------------------------------------------
1998 1997 1998 1997
------------------------------------- -----------------------------------
<S> <C> <C> <C> <C>
Income $ -0- $ -0- $ -0- $ -0-
--------------- ---------------- ---------------- ---------------
General and Administrative Expenses
Professional Fees 572 563 2,479 588
Management Fees - Related Party 300 900 900 900
Patent Fees 0 (423) 2,945 2,463
All Other General and Administrative
Expenses 29 73 161 180
--------------- ---------------- ---------------- ---------------
901 1,113 6,485 4,131
--------------- ---------------- ---------------- ---------------
Loss From Operations (901) (1,113) (6,485) (4,131)
--------------- ---------------- ---------------- ---------------
Other Income (Expense)
Interest Expense (10,494) (10,198) (31,983) (30,940)
--------------- ---------------- ---------------- ---------------
Net Loss Before Income Taxes (11,395) (11,312) (38,468) (35,071)
Income Tax Benefit -0- -0- -0- -0-
--------------- ---------------- ---------------- ---------------
Net Loss $ (11,395) $ (11,312) $ (38,468) $ (35,071)
=============== ================ ================ ===============
Weighted Average Number
of Common Shares 160,006,250 160,006,250 160,006,250 160,006,250
=============== ================ ================ ===============
Net Loss Per Common Share $ (0) $ (0) $ (0) $ (0)
=============== ================ ================ ===============
</TABLE>
See notes to financial statements
4
<PAGE>
<TABLE>
<CAPTION>
COMPUSONICS VIDEO CORPORATION & SUBSIDIARIES
STATEMENTS OF CASH FLOWS
(Unaudited)
For the nine months ended April 30,
-----------------------------------------
1998 1997
-----------------------------------------
<S> <C> <C>
Cash Flows From Operating Activities
Net Loss $ (38,468) $ (35,071)
Adjustments to Reconcile Net Loss to Net
Cash Used by Operating Activities
Change in Assets and Liabilities
Increase (Decrease) In:
Accounts Payable and Accrued
Liabilities 5,803 1,751
Accounts Payable
Related Entity 30,703 20,345
--------- -----------
Total Adjustments 36,506 22,096
--------- -----------
Net Cash (Used For) Operations (1,962) (12,975)
--------- -----------
Cash Provided by (Used For) Investing Activities -0- -0-
--------- -----------
Net Cash Provided by Investing Activities -0- -0-
--------- -----------
Cash Provided by (Used For) Financing Activities
Proceeds From Notes Payable - Related 1,850 13,100
--------- -----------
Net Cash Provided by (Used For) Financing Activities 1,850 13,100
--------- -----------
Increase (Decrease) in Cash (112) 125
Balance at Beginning of Period 153 266
--------- -----------
Balance at End of Period $ 41 $ 391
========= ===========
</TABLE>
See notes to financial statements
5
<PAGE>
COMPUSONICS VIDEO CORPORATION & SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
PART I. FINANCIAL INFORMATION
Item 1. Interim Financial Statements.
The accompanying consolidated financial statements of CompuSonics
Video Corporation and Subsidiaries have been prepared by the company
without audit. In the opinion of the company's management, the
financial statements reflect all adjustments necessary to present
fairly the results of operations for the nine-month period ended
April 30, 1998; the company's financial position at April 30, 1998
and July 31, 1997; and the cash flows for the nine-month period
ended April 30, 1998 and 1997. Certain notes and other information
have been condensed or omitted from the interim financial statements
presented in this Quarterly Report on Form 10-Q. Therefore, these
financial statements should be read in conjunction with the
company's July 1997 Form 10-K.
The results for the nine-month period ended April 30, 1998 are not
necessarily indicative of future financial results.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
The net loss from operations for the nine-month period ended April
30 ,1998 was $3,397 more than that for the nine-month period ended
April 30, 1997. This was due mainly to the increase in professional
fees of $1,891 and an increase in interest expense of $1,043.
Working capital decreased by $21,561 from July 31, 1997 to April 30
,1998, due to the net loss of $38,468 and an increase in unrealized
gain on investments of $16,907. In the past, the Registrant has
relied on a related company to provide the working funds it has
required but there is no assurance that this will continue in future
years.
The Registrant has the following marketable securities:
Williams Controls, Inc. 28,475 Common Shares
Cost - $25,035
Market Value at 04/30/98 - $84,535
These shares are used as collateral against the notes payable.
6
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits - None
(b) Reports on Form 8-K
On May 14, 1998, the Registrant filed a Form 8-K reporting the
extension date of the Class A and Class B warrants from May
15, 1998 to May 15, 1999.
7
<PAGE>
COMPUSONICS VIDEO CORPORATION
Form 10-Q
For the quarter ended April 30,1998
Signature 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.
COMPUSONICS VIDEO CORPORATION
(Registrant)
By s\ Robert R. Hebard
------------------------------------
Robert R. Hebard, Chief Executive
Officer & Chairman of the Board
Date Signed: June 10, 1998
8
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<CIK> 0000777844
<NAME> Compusonics Video Corporation
<MULTIPLIER> 1
<CURRENCY> U.S. dollars
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Jul-31-1998
<PERIOD-START> Feb-01-1998
<PERIOD-END> Apr-30-1998
<EXCHANGE-RATE> 1
<CASH> 41
<SECURITIES> 84,535
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 84,576
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 84,576
<CURRENT-LIABILITIES> 710,538
<BONDS> 0
0
0
<COMMON> 160,006
<OTHER-SE> (785,968)
<TOTAL-LIABILITY-AND-EQUITY> 84,576
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 6,485
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 31,983
<INCOME-PRETAX> 38,468
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,468
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
