U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB/A-1
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1995
Commission File Number 0-14692
______________________________________________
GLOBAL MAINTECH CORPORATION
f/k/a Mirror Technologies, Incorporated
Minnesota 41-1523657
State of Incorporation I.R.S. Employer Identification No.
9220 James Avenue South, Bloomington, MN 55431
Telephone Number: (612)885-0400
______________________________________________
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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______
______________________________________________
On October 18, 1995 there were 47,851,806 shares of the Registrant's no par
value common stock outstanding.
Transitional small business issuer format: No
Page 1 of 7
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GLOBAL MAINTECH CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
ASSETS
<CAPTION>
September 30, December 31,
1995 1994
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 116,295 $ 24,309
Accounts receivable, less
allowances for doubtful
accounts and sales returns 297,203 222,439
Other receivables 9,728 29,090
Inventories 420,630 573,612
Prepaid expenses and other 29,917 19,551
____________ ____________
Total current assets 873,773 869,001
PROPERTY AND EQUIPMENT, NET 66,203 849,932
____________ ____________
$ 939,976 $ 1,718,933
The accompanying notes are an integral part of these consolidated statements.
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GLOBAL MAINTECH CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<CAPTION>
September 30, December 31,
1995 1994
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 652,841 $ 857,400
Current portion interest
bearing obligations 624,788 588,304
Mortgage note payable 0 620,000
Accrued liabilities
Compensation and payroll taxes 8,097 19,992
Interest 26,565 24,163
Other 29,948 73,895
Deferred revenue 0 148,000
____________ ____________
Total current liabilities 1,342,239 2,331,754
LONG-TERM OBLIGATIONS
Notes payable and other
interest bearing obligations 98,000 490,531
Subordinated notes payable to
officers 0 400,000
Convertible subordinated debentures 296,750 0
____________ ____________
Total liabilities 1,736,989 3,222,285
STOCKHOLDERS' EQUITY (DEFICIT)
Voting, convertible preferred
stock - Series A, convertible
into one common stock share
for each preferred share,
no par value; 4,439,900
shares authorized;4,439,370
shares issued and outstanding;
total liquidation preference of
outstanding shares-$1,665,000 416,400 0
Common stock, no par value;
245,560,100 shares authorized;
47,851,806 shares issued and
outstanding 0 800
Additional paid in capital 250,671 79,200
Accumulated deficit (1,464,084) (1,583,352)
____________ ____________
(797,013) (1,503,352)
____________ ____________
$ 939,976 $ 1,718,933
The accompanying notes are an integral part of these consolidated statements.
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GLOBAL MAINTECH CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Net sales $ 730,754 $ 6,470,919 $ 5,999,012 $ 18,842,258
Cost of sales 601,468 6,021,181 5,045,940 17,792,633
____________ ____________ ____________ ____________
Gross profit 129,286 449,738 953,072 1,049,625
Operating expenses
Selling, general
and administrative 375,230 466,603 1,131,252 1,554,979
____________ ____________ ____________ ____________
Income (loss) from
operations (245,944) (16,865) (178,180) (505,354)
Other income/(expense)
Interest expense (30,395) (88,560) (104,074) (288,955)
Interest income 65 0 5,952 0
Amortization (2,359) 0 (7,077)
Other, principally
debt reduction 300,000 0 406,947 0
____________ ____________ ____________ ____________
Total other
income/(expense) 267,311 (88,560) 301,748 (288,955)
____________ ____________ ____________ ____________
Pre-tax
Income/(Loss) 21,367 (105,425) 123,568 (794,309)
Provision for income
taxes 1,800 0 4,300 0
____________ ____________ ____________ ____________
NET INCOME/(LOSS) $ 19,567 $ (105,425) $ 119,268 $ (794,309)
Net earnings/
(loss) per
common and
common equiva-
lent share: $ 0.00 $ (0.00) (1) $ 0.00 $ (0.02)(1)
____________ ____________ ____________ ____________
Weighted average
number of
common and
common equivalent
shares out-
standing 46,221,371 46,221,371 (1) 42,776,381 42,776,381 (1)
<FN>
<F1> Net earnings/(loss) per share and weighted average number of common and
common equivalent shares outstanding at March 31 and June 30, 1994 assume
the merger between Global MAINTECH, Inc. and Global MAINTECH Corporation
had occurred on January 1, 1994 for presentation purposes.
</FN>
The accompanying notes are an integral part of these consolidated statements
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GLOBAL MAINTECH CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Nine Months Ended
September 30,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 119,268 $ (614,309)
Adjustments to reconcile net income
(loss) to net cash used in operating
activities:
Depreciation and amortization 50,872 88,521
Debt forgiveness (400,000) 0
(Gain) on sale of equipment (8,173) 0
Changes in operating assets and
liabilities:
(Increase)/decrease in:accounts
receivable (55,403) (120,278)
(Increase)/decrease in:inventories 152,982 132,375
(Increase)/decrease in:prepaid
expenses (3,827) 16,331
Increase/(decrease) in:accounts
payable (205,497) (88,552)
Increase/(decrease) in:accrued
expenses (23,275) (84,738)
Increase/(decrease) in:deferred
revenue (148,000) 0
Increase/(decrease) in:other 33,710 0
____________ ____________
Cash used by operating activities (487,343) (670,650)
Cash flows from investing activities:
Proceeds/(payment) from sale/
(purchase) ofproperty and equipment 743,389 (77,793)
Net cash received in merger 637,071 0
____________ ____________
Cash provided/(used) by investing
activities 1,380,460 (77,793)
____________ ____________
Cash flows from financing activities:
Proceeds from issuance of Common Stock 150,000 0
Increase/(decrease) in short-term notes
payable (62,641) 373,000
Principal payments on mortgage note
payable (620,000) 0
Increase/(Reduction) of long-term notes
payable (268,490) 306,589
Dividend distribution 0 (90,000)
____________ ____________
Cash provided/(used) by financing
activities (801,131) 589,589
Net increase/(decrease) in cash 91,986 (158,854)
Cash at beginning of period 24,309 149,103
____________ ____________
Cash at end of period $ 116,295 $ (9,751)
The accompanying notes are an integral part of these consolidated statements.
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FOOTNOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Merger
Effective January 1, 1995, MAINTECH, a company which brokers and sells parts for
IBM mainframe computers as well as computer systems for monitoring large data
centers, merged into the Company pursuant to the terms of an Agreement and Plan
of Merger (the "Agreement") dated December 6, 1994, as amended. While the
Company is the legal surviving entity, MAINTECH is considered the surviving
entity for accounting and reporting purposes. Under the terms of the Agreement,
each of the 80,000 shares of MAINTECH common stock outstanding was converted
into 358.75 shares of the Company's common stock. As a result, the Company
issued 28,700,001 shares of common stock in exchange for all the outstanding
capital stock of MAINTECH. The merger has been accounted for as though MAINTECH
had issued 16,651,805 shares of its common stock and 4,439,370 of preferred
stock to the Mirror shareholders for all of Mirror's net assets, principally
cash.
In addition, in connection with the merger, outstanding options of MAINTECH to
purchase 68,214 shares of MAINTECH's common stock converted into the right to
purchase approximately 24,472,006 shares of the Company's common stock at an
exercise price of $.03 per share. Options covering 24,200,001 shares of the
Company's common stock will vest on June 1, 1999, or earlier, subject to the
Company attaining certain earnings levels.
As a result of this merger, the former shareholders of MAINTECH hold
unregistered stock comprising approximately 58 percent of the common stock and
common stock equivalents of the Company and if the options to purchase common
stock are exercised, these shareholders will hold approximately 70 percent of
the outstanding shares of the Company. Two of the officers of MAINTECH were
elected to the Board of Directors of the Company subsequent to the consummation
of the merger.
Basis of Presentation
As a result of the merger described above, the consolidated financial statements
represent the historical financial information of MAINTECH and include the
accounts of Mirror since the date of the merger.
The interim consolidated financial statements are unaudited, but in the opinion
of management, reflect all adjustments necessary for a fair presentation of
results for such periods. All such adjustments are of a normal recurring nature
The results of operations for any interim period are not necessarily
indicative of results for the full year. These financial statements should be
read in conjunction with the audited consolidated financial statements and notes
thereto contained in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1994. The audited financial statements of MAINTECH are
presented in Form 8-K/A-1 dated January 4, 1995.
Reclassifications
Certain reclassifications have been made to the fiscal 1994 data to conform with
the fiscal 1995 presentation.
Common Equivalent Shares Outstanding
The preferred stock is, because of its terms and the circumstances under which
it was issued, in substance a common stock equivalent. The preferred
stockholders can convert, at their option, to common stock on a one-for-one
basis and accordingly can expect to participate in the appreciation of the
value of the common stock. Accordingly, the weighted average common and common
equivalent shares outstanding include the 47,851,806 common stock outstanding
and the preferred stock of 4,439,370 outstanding since its issuance on
September 13, 1994.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
GLOBAL MAINTECH CORPORATION
December 14, 1995 By:/s/ James Geiser
Chief Financial and
Chief Accounting Officer
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
December 14, 1995 By: /s/ David McCaffrey
Chief Executive Officer
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