Form 10-QSB -- Page-1
FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Quarter Ended February 06, 2000
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-15900
DUPONT DIRECT FINANCIAL HOLDINGS, INC.
(Exact name of Issuer as specified in its charter)
Georgia 59-3461241
other jurisdiction of (I.R.S. employer
incorporation or organization) Identification No.)
(Address of principal offices)
42 Broadway Suite 101
New York, NY 10001
(Issuer's telephone number, including area code)
917-320-4800
Indicate by check mark whether the Issuer (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 Issuer
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
State the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable dates.
Title of Each Class Outstanding at February 06, 2000
Common Stock, $0.01 Par Value The number of shares outstanding of the
Registrant's common stock was
1,320,000 (according to the records of
the transfer agent, American Stock
Transfer & Trust Company) as of May 5,
1999, and 7,150,000 as of the date of
this Quarterly Report on Form 10-QSB.
<PAGE>
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION PAGE
ITEM 1 Financial Statements
Balance Sheets as of February 06, 2000
and February 04, 1999 3
Statements of Operations for the Periods ending
February 06, 2000 and February 04, 1999 4
Statements of Cash Flow for the Periods Ending
February 06, 2000 and February 04, 1999 5
Notes to Financial Statements 6
ITEM 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II OTHER INFORMATION 9
SIGNATURES 9
<PAGE>
Dupont Direct Financial Holdings, Inc.
(a Dormant State Company)
Balance Sheet
Fiscal Years 2000 and 1999
February 06, 2000 and February 04, 1999
(unaudited)
02/06/00 02/04/99
Assets
Organization Cost ................................ $ 0 $ 0
Total Assets .................................... 0 0
Liabilities and Shareholder's Equity
Total Liabilities ................................ $ 9,100 $ 0
Stockholders' Equity
Common Stock par value at $.01 per share
20,000,000 shares authorized,
1,320,000 shares issued and outstanding .......... 13,200 2,872
Additional Paid in Capital ....................... 37,975 46,040
Retained Earnings (Deficit) ..................... (45,220) (46,720)
Net Income/Loss .................................. (15,055) (2,192)
-------- --------
Total Shareholders' Equity ....................... $ (9,100) 0
-------- --------
Total Liabilities and
Shareholders Equity .............................. $ 0 $ 0
======== ========
See accompanying notes to financial statements
<PAGE>
Dupont Direct Financial Holdings, Inc.
(a Dormant State Company)
Statements of Operations
Fiscal Years 2000 and 1999
for the period ending
February 06, 2000 and February 04, 1999
(unaudited)
02/06/00 02/04/99
------- --------
Revenues ..................................... $ 0 $ 0
Expenses
Administrative Expenses ...................... $ 1,500 $ 2,192
Net Income/Loss for the quarter .............. $(1,500) $(2,192)
======= =======
See accompanying notes to financial statements
<PAGE>
Dupont Direct Financial Holdings, Inc.
(a Dormant State Company)
Statements of Cash Flows
Fiscal Years 2000 and 1999
For periods ended
February 06, 2000 and February 04, 1999
(unaudited)
For Periods Ended 2/06/00 02/04/99
--------------------
Cash Flows from
Operating Activities
Net Income ................................ $(1,500) $(2,192)
Net Cash Provided (used) /
By Operating Activities ...................... 0 0
Expenses Paid by Capston ..................... 1,500 2,192
Net Increase (Decrease) in Cash .............. 0 0
Cash at Beginning of Period .................. 0 0
Cash at End of Period ........................ $ 0 $ 0
======= =======
See accompanying notes to financial statements
<PAGE>
Dupont Direct Financial Holdings, Inc.
(A Dormant State Company)
February 06, 2000
Note 1. HISTORY OF THE REGISTRANT
FAB Global Inc. (the "Company") is a Georgia corporation formerly known as Marci
International Imports, Inc. Marci conducted an initial public offering in
February 1987 pursuant to a Form S-18 Registration Statement under the
Securities Act of 1933 (the "Securities Act"). In connection with an application
to list its Common Stock on the NASDAQ system, Marci also registered its Common
Stock pursuant to Section 12(g) of the Securities Exchange Act of 1934 (the
"Exchange Act"). As a result of a 1989 bankruptcy proceeding, Marci became an
inactive shell that had with no material assets, liabilities or business
activities. Marci remained inactive until June 1998 when its stockholders
approved a plan of reorganization proposed by Capston Network Company of
Clearwater, Florida ("Capston"). This plan of reorganization authorized Capston
to seek a suitable business combination opportunity for the Company, authorized
a series of changes in the Company's corporate structure, and provided for
stock-based compensation to Capston and others for services rendered and to be
rendered in connection with the implementation of the plan of reorganization.
Capston began actively seeking a business opportunity for the Company in the
summer of 1998. After investigating a number of potential opportunities, Capston
negotiated a business combination transaction (the "Transaction") with FAB
Capital Corporation, an Idaho corporation ("FAB Capital") and Western Union
Leasing Ltd., a trust organized under the laws of the United Kingdom
("Western"). Pursuant to the terms of a written agreement dated April 5, 1999,
FAB Capital and Western agreed to transfer certain assets to the Company solely
in exchange for newly issued shares of the Company's common stock.
In the winter of 1999, it became evident that FAB Capital and Western were
incapable of fully performing all of their obligations under the agreements
relating to the original reorganization transaction. After carefully reviewing
the relevant facts, the board of directors of the Company, the board of
directors of FAB Capital and the trustee of Western concluded that reformation
of original reorganization transaction would likely prove unduly complex,
burdensome and expensive. They also jointly concluded that such a reformation
would not give the Company's stockholders the value that was contemplated by the
original reorganization transaction. Accordingly, the board of directors of the
Company, the board of directors of FAB Capital and the trustee of Western
jointly agreed in late January of 2000 to rescind the original reorganization
transaction in its entirety. In connection therewith, FAB Capital and Western
returned an aggregate of 11,400,000 shares of common stock to the Company for
cancellation.
In connection with the decision to rescind the original reorganization
transaction, certain former officers of FAB Capital proposed an alternative
business combination (the "New Transaction"), which would permit the Company to
continue in business as a diversified financial services holding company. After
evaluating the proposal, the board of directors of the Company agreed to issue
5,830,000 shares of the Company's common stock to Wavecount, Inc. ("Wavecount"),
a privately-held financial services holding company, in exchange for
substantially all of the operating assets of Wavecount. The operating assets
transferred to the Company in connection with the New Transaction include:
1. Dupont Securities Group, Inc. ("DSGI"), a registered United States
securities broker-dealer operating under the NASD's $100,000 net capital
requirements. DSGI is now 100% by owned Wavecount, although the approval
of the acquisition by the National Association of Securities Dealers, Inc.
("NASD") pursuant to its rules is still pending. Such approval is
reasonably expected in due course.
2. Wavecount Futures, Inc. ("Futures"), an Introducing Futures Broker
registered with the National Futures Association (NFA) and the Commodity
Futures Trading Commission (CFTC);
3. Wavecount Asset Management, Inc. ("WAM"), an investment manager that has
applied for Registration as an Registered Investment Advisor (RIA). WAM has
an association with Jordan Advisory, a minority owned RIA, which manages
approximately $800 million. Jordan as a sub-advisor for Fixed Income assets
will list WAM as soon as its registration is effective.
4. A 49% equity interest in Native American Financial Services Company
("NAFSCO"). NAFSCO is a financial services company located in Window Rock,
Arizona, the capital of the Navajo Nation. Along with Murray Lee, the 51%
Navajo majority partner, Wavecount established NAFSCO as the first Native
American financial services company resident on a Native American
reservation.
5. B&S Portfolio Management, GmbH ("B&S"), a registered securities broker
located in Munich, Germany which also operates as an asset management firm
and investment advisor. Wavecount has signed a letter of intent to acquire
B&S in exchange for 200,000 newly issued shares of the Company's common stock
and it is anticipated that this transaction will close on or before April 30,
2000.
6. 300,000 shares of King's Road Entertainment, Inc. (OTCBB: KREN);
7. 250,000 shares of Chariot International Holdings, Inc. (OTCBB: CHIH);
8. 250,000 shares of Immediate Entertainment Group, Inc, (OTCBB: IEGPE).
As a result of the New Transaction, it is anticipated
that the Company's name will be changed to Dupont Direct Financial Holdings,
Inc., and a new slate of directors and executive officers will be appointed.
Prior to April 5, 1999, the Company had no material
assets, liabilities or business operations. In substance, the Company was a
publicly held shell corporation whose sole business activity was the search for
a suitable business opportunity. As a result of the original reorganization
transaction, the Company had certain contract rights as of May 5, 1999, the end
of its most recent fiscal year. Since the original reorganization transaction
was subsequently rescinded as a result of the failure of performance by FAB
Capital and Western, this Annual Report on Form 10-KSB will treat the Company as
a publicly held shell until the date of the New Transaction.
Note 2.PAID IN CAPITAL
Capston was not entitled to reimbursement for any expenses incurred by it on
behalf of the Registrant. However, because Sally Fonner is both the Acting
President of Dupont Direct Financial Holdings, Inc. and Capston, prior Staff
Accounting Bulletins required under generally accepted accounting the treatment
of debiting the expenses with corresponding credit to paid-in capital. These
expenses are actual cash expenditures and do not reflect any costs associated
with the operation of Capston nor any personnel time or cost.
Note 3. OUTSTANDING SHARES
The 1,320,000 shares outstanding as of May 4, 1999 is a result of the following
actions:
Reverse split of 18 to 1 of 1998's outstanding 5,181,085 shares
Contractual shares issued to Capston Network Company Shares issued for
business and legal consulting on the rescinded
transaction and
Shares cancelled that had been issued for assets that were never
transferred on the rescinded transaction.
The shares outstanding as of February 7, 2000, the date of this report, are
7,150,000 due to the issuance of new shares for the new acquisition.
<PAGE>
Item 2. Management Discussion and Analysis of Financial Condition and Results
of Operations.
Disclosures contained in Part 1 of the Registrant's Annual Report 10-KSB year
ended May 4, 1999 incorporated herein by reference.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
NONE
ITEM 2. CHANGES IN SECURITIES
NONE
ITEM 3. DEFAULTS ON SENIOR SECURITIES
NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
NONE
ITEM 5. OTHER INFORMATION
NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits None
--------
B. Reports on Form 8-K 02/01/00; 02/08/00; 02/27/00
--------------------
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dupont Direct Financial Holdings,
Inc.
__________/s/__________
Randy M. Strausberg
Chief Executive Officer
Dated: March 27, 2000
/s/
--------------------
Randy M. Strausberg
Chief Financial Officer
Dated: March 27, 2000
