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Previous: COLUMBUS ENERGY CORP, SC 13G/A, 1998-03-10 |
Next: ALLIANCE CAPITAL MANAGEMENT LP, S-8, 1998-03-10 |
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of The Securities Exchange Act of 1934
For Quarter ended Commission file number
January 31, 1998 33-18218-NY
- ---------------- ----------------------
DYNAMARK CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3376786
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
56 Dune Road, Atlantic Beach, New York 11509
- ---------------------------------------- --------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (516) 889-3630
--------------
N/A
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last
report.
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 (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
--- ---
Common Stock outstanding as of January 31, 1998:
18,000,000, par value .0001 per share.
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
QUARTERLY REPORT FORM 10-Q FOR
THREE MONTHS AND SIX MONTHS ENDED JANUARY 31, 1998 AND 1997
AND FOR THE PERIOD FROM INCEPTION (AUGUST 1, 1986)
THROUGH JANUARY 31, 1998
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Page
----
Balance Sheet as of January 31,
1998 and July 31, 1997 I-1
Statement of Operations for the Three Months and Six Months
Ended January 31, 1998 and 1997 and for the Period From
Inception (August 1, 1986)
Through January 31, 1998 I-2
Statement of Cash Flows for the Three Months and Six Months
Ended January 31, 1998 and 1997 and for the Period From
Inception (August 1, 1986)
Through January 31, 1998 I-3 - 4
Notes to Financial Statements I-5 - 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations I-7
PART II. OTHER INFORMATION
Signatures II-1
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
JANUARY 31, 1998 (UNAUDITED) AND JULY 31, 1997
ASSETS
------
January 31, July 31,
1998 1997
----------- ----------
(Unaudited)
Current assets
Cash $ 202,077 $ 99,593
Note receivable - 97,500
Accrued interest receivable - 7,734
Prepaid income taxes 395 395
----------- ----------
Total current assets 202,472 205,222
Computer equipment - at cost, less accumulated
depreciation of $13,556 at January 31, 1998
and July 31, 1997 - -
----------- ----------
$ 202,472 $ 205,222
=========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities
Accrued expenses $ 18,472 $ 15,432
----------- ----------
Due to officer 162,961 159,961
----------- ----------
Shareholders' equity
Preferred stock, $.0001 par value; 5,000,000 shares
authorized, none issued - -
Common stock, $.0001 par value; 50,000,000 shares
authorized, 18,000,000 shares issued and
outstanding at January 31, 1998 and July 31, 1997 1,800 1,800
Additional paid-in capital 556,751 556,751
Deficit accumulated during the development stage (537,512) (528,722)
----------- ----------
21,039 29,829
----------- ----------
$ 202,472 $ 205,222
=========== ==========
The accompanying notes are an integral part of these financial statements.
I-1
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
January 31, January 31,
-------------------------------- --------------------------------
1998 1997 1998 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues
Interest income $ 2,481 $ 55,997 $ 4,619 $ 56,682
Licensing revenue - - - -
Amortization of excess of investment over
net assets acquired - - - -
Equity in operating losses of investee - - - -
Write-downs of investments - - - -
Recovery of note receivable written off - - - -
------------- ------------- ------------- --------------
Total revenues 2,481 55,997 4,619 56,682
------------- ------------- ------------- -------------
Expenses
Salaries
Officer - - - -
Other - - - -
Automobile rental and expenses - - - -
Professional fees 4,000 4,000 6,943 7,150
Other, including rent expense incurred to officer of
$1,500 for the three months ended January 31,
1998 and 1997, $3,000 for the six months
ended January 31, 1998 and 1997, and $69,000
for the period from inception to January 31, 1998 3,464 3,028 6,466 6,029
Licensing agreement:
Costs - - - -
Loss on termination - - - -
------------- ------------- ------------- -------------
Total expenses 7,464 7,028 13,409 13,179
------------- ------------- ------------- -------------
Net income (loss) during the development stage $ (4,983) $ 48,969 $ (8,790) $ 43,503
============= ============= ============= =============
Income (loss) per common share $ -0- $ -0- $ -0- $ -0-
============= ============= ============= =============
Weighted average number of shares 18,000,000 18,000,000 18,000,000 18,000,000
============= ============= ============= =============
<CAPTION>
Period From
Inception
(August 1,
1986)
Through
January 31,
1998
-------------
<S> <C>
Revenues
Interest income $ 205,021
Licensing revenue 1,469
Amortization of excess of investment over
net assets acquired ( 17,500)
Equity in operating losses of investee ( 14,894)
Write-downs of investments ( 91,994)
Recovery of note receivable written off 97,500
-------------
Total revenues 179,602
-------------
Expenses
Salaries
Officer 282,980
Other 29,820
Automobile rental and expenses 28,618
Professional fees 179,338
Other, including rent expense incurred to officer of
$1,500 for the three months ended January 31,
1998 and 1997, $3,000 for the six months
ended January 31, 1998 and 1997, and $69,000
for the period from inception to January 31, 1998 183,651
Licensing agreement:
Costs 11,238
Loss on termination 1,469
-------------
Total expenses 717,114
-------------
Net income (loss) during the development stage $ (537,512)
=============
Income (loss) per common share $ ( .03)
=============
Weighted average number of shares 17,698,265
=============
</TABLE>
The accompanying notes are an integral part of these financial statements.
I-2
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
January 31, January 31,
-------------------------------- --------------------------------
1998 1997 1998 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net income (loss) $ (4,983) $ 48,969 $ ( 8,790) $ 43,503
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operating activities
Equity in operating losses of investee - - - -
Amortization of excess of investment
over net assets acquired - - - -
Write-down of investments - - - -
Recovery of note receivable written off - - - -
Depreciation and amortization - - - -
Changes in assets and liabilities
Accrued interest receivable - - 7,734 -
Prepaid income taxes - - - -
Deferred lease costs - - - -
Deposits - - - -
Deposits repaid - - - -
Accrued expenses 413 (5,005) 3,040 (3,055)
Due to officer 1,500 1,500 3,000 3,000
Other - - - -
------------- ------------- ------------- -------------
Net cash provided by (used in) operating
activities (3,070) 45,464 4,984 43,448
------------- ------------- ------------- -------------
<CAPTION>
Period From
Inception
August 1,
1986)
Through
January 31,
1998
-------------
<S> <C>
Cash flows from operating activities
Net income (loss) $ (537,512)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operating activities
Equity in operating losses of investee 14,894
Amortization of excess of investment
over net assets acquired 17,500
Write-down of investments 91,994
Recovery of note receivable written off ( 97,500)
Depreciation and amortization 22,155
Changes in assets and liabilities
Accrued interest receivable ( 24,375)
Prepaid income taxes ( 395)
Deferred lease costs ( 7,200)
Deposits ( 797)
Deposits repaid 797
Accrued expenses 18,472
Due to officer 162,961
Other 549
-------------
Net cash provided by (used in) operating
activities (338,457)
-------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
(Continued)
I-3
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
January 31, January 31,
-------------------------------- --------------------------------
1998 1997 1998 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Cash flows from investing activities
Investments and related advances $ - $ - $ - $ -
Proceeds from repayment of advances - - - -
Proceeds from collection of note receivable - - 97,500 -
Acquisition of computer equipment - - - -
------------- ------------- ------------- -------------
Net cash provided by (used in) investing
activities - - 97,500 -
------------- ------------- ------------- -------------
Cash flows from financing activities
Proceeds of sale of common stock pursuant to public
offering - - - -
Payments of notes payable - affiliate - - - -
------------- ------------- ------------- -------------
Net cash provided by financing activities - - - -
------------- ------------- ------------- -------------
Net increase (decrease) in cash and cash equivalents (3,070) 45,464 102,484 43,448
Cash, beginning of period 205,147 59,686 99,593 61,702
------------- ------------- ------------- -------------
Cash, end of period $ 202,077 $ 105,150 $ 202,077 $ 105,150
============= ============= ============= =============
Cash paid (received) during the periods for
Income taxes $ -0- $ -0- $ -0- $ -0-
============= ============= ============= =============
Interest $ -0- $ (55,997) $ -0- $ (56,682)
============= ============= ============= =============
<CAPTION>
Period From
Inception
(August 1,
1986)
Through
January 31,
1998
-------------
<S> <C>
Cash flows from investing activities
Investments and related advances $ (225,013)
Proceeds from repayment of advances 125,000
Proceeds from collection of note receivable 97,500
Acquisition of computer equipment ( 13,556)
-------------
Net cash provided by (used in) investing
activities ( 16,069)
-------------
Cash flows from financing activities
Proceeds of sale of common stock pursuant to public
offering 576,030
Payments of notes payable - affiliate ( 19,427)
-------------
Net cash provided by financing activities 556,603
-------------
Net increase (decrease) in cash and cash equivalents 202,077
Cash, beginning of period -
-------------
Cash, end of period $ 202,077
=============
Cash paid (received) during the periods for
Income taxes $ 6,346
=============
Interest $ (166,714)
=============
</TABLE>
The accompanying notes are an integral part of these financial statements.
I-4
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
1 - GENERAL
The financial statements contained within are unaudited but reflect
all adjustments which, in the opinion of the Company, are necessary to
fairly present the financial position of the Company as of January 31,
1998, and its results of operations and cash flows for the three and six
month periods ended January 31, 1998 and 1997 and from inception (August 1,
1986) through January 31, 1998.
2 - LOSS PER SHARE
Loss per common share is computed as if all shares issued during a
year had been outstanding as of the beginning of that year. Stock options
and warrants have not been included in the calculation since inclusion of
such shares would be anti-dilutive.
3 - RESULTS OF OPERATIONS
The Company has been in the development stage since its inception on
August 1, 1986. The Company has not generated operating revenues as of
January 31, 1998, and no assurance can be given that it will generate
revenues and earnings in the future.
4 - CONSULTING AGREEMENT
During the year ended July 31, 1992, the Company entered into an
agreement with an entity to render consulting services to the Company in
identifying equity or debt financing and/or potential merger candidates.
Under the agreement, the Company paid a $5,000 nonrefundable fee to that
entity, which was included in professional fees for the year ended July 31,
1992. Pursuant to the agreement terms, the Company will be obligated to pay
an additional $5,000 upon identification of a potential source of financing
or a merger/acquisition candidate. The Company is also obligated to make an
additional $15,000 payment upon the successful closing (signed letter of
intent) of either a financing agreement or merger/acquisition. In addition,
the agreement provides that the consulting entity will receive shares of
Dynamark Corporation, which will be restricted pursuant to Rule 144 of the
Securities and Exchange Commission. The agreement specifies that it will
terminate upon successful identification of financing or a
merger/acquisition, or when it is terminated by one of the parties.
(Continued)
I-5
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
4 - CONSULTING AGREEMENT (Continued)
During the year ended July 31, 1992, the Company entered into a
transaction covered by the consulting agreement, which resulted in a letter
of intent qualifying for compensation under the agreement. During that
year, the transaction was aborted. The Company incurred consulting fees of
$2,500 to this consultant in settlement of its obligation concerning the
letter of intent.
As of January 31, 1998, there are no currently pending financings or
merger/acquisitions subject to this agreement, which remains in effect.
5 - LIQUIDITY AND CAPITAL RESOURCES
There have been no material changes in the Company's financial
position, liquidity or capital resources since July 31, 1997, other than
the effect of incurring normal company operating expenses discussed in Note
3 and the collection of a note receivable of $97,500 and related interest
of $8,548 during the six months ended January 31, 1998.
I-6
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
AND RESULTS OF OPERATIONS
o Results of Operations
The Company had a net loss of $4,983 for the
three months ended January 31, 1998 compared to a net
income of $48,969 for the three months ended January
31, 1997, principally due to the receipt of interest
income on an old note receivable.
o Financial Condition
The Company had a shareholders' equity of $21,039
at January 31, 1998 compared to $29,829 at July 31,
1997, its most recent year-end. The decrease in
shareholders' equity is due to the net loss sustained
from operations during the six months ended January 31,
1998 of $8,790.
The Company's principal asset at January 31,
1998 and its prior year ended July 31, 1997 continues
to be cash. Changes in the Company's cash balance
result from a one-time collection of approximately
$106,000 from an old note receivable and a portion of
interest due on it, less payment of operating expenses,
primarily professional fees.
The Company is expected to remain in the
development stage for the foreseeable future. As such,
the Company is likely to only incur professional fees
and miscellaneous expenses in the future.
I-7
<PAGE>
DYNAMARK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
QUARTER ENDED JANUARY 31, 1998
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, Registrant has duly caused this Report to
be signed on its behalf by the undersigned, thereunto duly authorized.
DATE: DYNAMARK CORPORATION
By:
- -------------------------- -------------------------------
Allan Rothstein
President and Director
II-1
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUL-31-1998
<PERIOD-END> JAN-31-1998
<CASH> 202,077
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 202,472
<PP&E> 13,556
<DEPRECIATION> 13,556
<TOTAL-ASSETS> 202,472
<CURRENT-LIABILITIES> 18,472
<BONDS> 0
<COMMON> 1,800
0
0
<OTHER-SE> 19,239
<TOTAL-LIABILITY-AND-EQUITY> 202,472
<SALES> 0
<TOTAL-REVENUES> 4,619
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 13,409
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (8,790)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,790)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
|
|