FORM 10-QSB
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 QUARTERLY PERIOD ENDED: DECEMBER 31, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
----- OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM N/A TO
-------- --------
COMMISSION FILE NUMBER : 33-21239
TRAVEL DYNAMICS, INC.
------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FORMERLY KNOWN AS: GREENWAY ENVIRONMENTAL SYSTEMS, INC.
NEVADA 87-0462569
------------------------------- ----------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION #)
7525 EAST CAMELBACK ROAD, SUITE 202
SCOTTSDALE, AZ 85251
----------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(ZIP CODE)
(602) 949-9500
----------------------------------------------------
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED
ALL REPORTS REQUIRED TO BE FILED BY SECTIONS 12, 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 REPORT(S), AND (2) HAS BEEN
SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS.
YES X NO AS TO FILING YES X NO AS TO FILING REQUIREMENT
----- ----- ----- -----
THE NUMBER OF SHARES OUTSTANDING AT DECEMBER 31, 1998: 4,290,080
<PAGE>
TRAVEL DYNAMICS, INC.
INDEX
PAGE
----
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS .................................... EXHIBIT
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.................. 3
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF
SECURITY HOLDERS................................................9
ITEM 5. OTHER INFORMATION ..............................................9
ITEM 6. EXHIBITS ......................................................10
[INAPPLICABLE ITEMS HAVE BEEN OMITTED]
2
<PAGE>
PART I. - FINANCIAL INFORMATION
-------------------------------
ITEM 1. FINANCIAL STAtEMENTS. [UNAUDITED]
- -----------------------------
THE CONSOLIDATED FINANCIAL STATEMENTS OF TRAVEL DYNAMICS, INC. FOR THE
THREE MONTH AND SIX MONTH PERIODS ENDING DECEMBER 31, 1998, ARE ATTACHED AND
INCORPORATED BY THIS REfERENCE AS ITEM 1. THE ACCOMPANYING CONSOLIDATED
FINANCIAL STATEMENTs INCLUDE THE ACCOUNTS OF TRAVEL DYNAMICS, L.L.C. FROM MARCH
1, 1998 (DATE OF INCEPTION) THROUGH JULY 31, 1998 (DATE OF ASSET ACQUISITION)
AND THE ACCOUNTS OF TRAVEL DYNAMICS, INC. (NOW KNOWN AS TRAVEL DYNAMIC SERVICES,
INC.) FROM JULY 31, 1998 (INCEPTION) TO DECEMBER 31, 1998. ThE CONSOLIDATED
FINANCIAL STATEMENTS ALSO INCLUDE THE ACCOUNTS OF GREENWAY ENVIRONMENTAL
SYSTEMS, INC., (NOW KNOWN AS "TRAVEL DYNAMICS") FROM THE DATE OF THE ACQUISITION
ON SEPTEMBER 29, 1998 TO YEAR END. ThESE TWO ENTITIES ARE COLLECTIVELY REFERRED
TO AS "THE COMPANY." ALL SiGNIFICANT INTERCOMPANY TRANSACTIONS AND BALANCES HAVE
BEEN ELIMINATED IN CONSOLIDATION.
TRAVEL DYNAMICS, INC.
CONDENSED BALANCE SHEET
(Unaudited)
ASSETS
December 31, 1998
-----------------
Current Assets
Cash $ 5,978
Employee advances 2,666
Related party receivable 47,933
Inventory 8,807
Prepaid expenses 29,764
Deposits and retainers 147,567
-----------------
Total Current Assets 242,715
-----------------
Property and Equipment 71,469
Less accumulated depreciation (4,221)
-----------------
Net Property and Equipment 67,248
-----------------
Intangible and Other Assets 119,311
-----------------
Total Assets $ 429,274
=================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable $ 211,463
Accrued liabilities 40,861
Deferred revenue 260,160
-----------------
Total Current Liabilities 512,484
-----------------
Stockholders' Equity
Common stock -$0.001 par value; 50,000,000
shares authorized; 4,290,080 shares issued
and outstanding 4,290
Additional paid-in capital 533,538
Accumulated deficit (621,038)
-----------------
Total Stockholders' Deficit (83,210)
-----------------
Total Liabilities And Stockholders' Deficit $ 429,274
=================
See the accompanying notes to condensed financial statements.
<PAGE>
TRAVEL DYNAMICS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three For the Three
Months Ended Months Ended
December 31, December 31,
1998 1998
-------------- ------------
Revenues $ 769,990 $ 1,260,504
Cost of Revenues 480,626 779,271
Gross Profit 289,364 481,233
General and Administrative Expense 501,755 794,288
-------------- ------------
Net Loss Before Merger and
Acquisition Expenses (212,391) (313,055)
Merger and Acquisition Costs - 307,983
-------------- ------------
Net Loss $ (212,391) $ (621,038)
============== ============
Basic and Diluted Loss Per Common Share $ (0.05) $ (0.21)
============== ============
Weighted Average Common Shares Outstanding 4,121,602 2,909,878
============== ============
See the accompanying notes to condensed financial statements.
<PAGE>
TRAVEL DYNAMICS, INC.
STATEMENT OF STOCKHOLDERS' DEFICIT
(Unaudited)
<TABLE>
<CAPTION>
Common Stock Additional Total
------------------- Paid-In Accumulated Stockholders'
Shares Amount Capital Deficit Deficit
---------- ------ --------- ---------- ------------
<S>
<C> <C> <C> <C> <C>
Balance, March 1, 1998 - $ - $ - $ - $ -
Issuance for cash, March 1998 1,532,164 1,532 (877) - 655
Distribution to shareholder,
August 1998 - - (900) - (900)
Conversion of notes payable,
August 1998 467,836 468 343,892 - 344,360
Issuance for assets of Greenway,
September 1998 1,236,072 1,236 8,774 - 10,010
Issuance to a consulting firm for
services, September 1998 404,008 404 60,197 - 60,601
Issuance to an officer for services,
September 1998 400,000 400 59,600 - 60,000
Issuance to an officer for
services, December 1998 250,000 250 37,250 - 37,500
Compensation relating to grant of
stock options - - 25,602 - 25,602
Net loss - - - (621,038) (621,038)
---------- ------ -------- ----------- ------------
Balance, December 31, 1998 4,290,080 $4,290 $533,538 $ (621,038) $ (83,210)
========= ====== ======== =========== ============
</TABLE>
See the accompanying notes to condensed financial statements.
<PAGE>
TRAVEL DYNAMICS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six
Months Ended
December
31, 1998
------------
Cash Flows From Operating Activities
Net loss
$ (621,038)
Adjustments to reconcile net loss to net cash
used by operating activities:
Depreciation and amortization 6,836
Compensation and expenses paid with common stock 158,101
Compensation paid with stock options 25,602
Expenses paid with notes payable 166,112
Changes in assets and liabilities:
Employee advances (2,666)
Prepaid expenses (29,764)
Inventory (8,807)
Deposits and retainers (147,566)
Accounts payable 211,463
Accrued liabilities 40,861
Deferred revenue 260,160
------------
Net Cash Provided By Operating Activities 59,294
------------
Cash Flows From Investing Activities
Cash paid for office equipment (15,148)
Increase in related party receivable (37,923)
------------
Net Cash Used In Investing Activities (53,071)
------------
Cash Flows From Financing Activities
Distributions to shareholder (900)
Proceeds from issuance of common stock 655
------------
Net Cash Used In Financing Activities (245)
------------
Net Increase in Cash 5,978
Cash at Beginning of Period -
------------
Cash at End of Period $ 5,978
============
Supplemental Schedule of Noncash Investing and Financing Activities:
Notes payable in the amount of $344,360 were incurred from the payment of
$166,112 of expenses, the purchase of equipment of $56,321 and other assets
of $4,269. The Company issued 467,836 shares of common stock upon
conversion of notes payable in the amount of $344,360. The Company was
deemed to have issued 1,236,072 common shares to the shareholders Greenway
Environmental Systems, Inc. in exchange for $10,010 of assets.
See the accompanying notes to condensed financial statements.
<PAGE>
TRAVEL DYNAMICS INC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1- NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation - The accompanying consolidated financial statements
include the accounts of Travel Dynamics, L.L.C. from March 1, 1998 (date of
inception) through July 31, 1998 and the accounts of Travel Dynamics, Inc.
(Travel Dynamics) from July 31, 1998 through December 31, 1998. The consolidated
financial statements include the accounts of Greenway Environmental Systems,
Inc. from the date of its acquisition for accounting purposes on September 29,
1998. These entities are collectively referred to as "the Company." All
significant intercompany transactions and balances have been eliminated in
consolidation.
Nature of Operations - The Company is a marketing firm which sells discount
travel packages. Direct marketing of the travel packages is through independent
sales agents and through the Internet. The Company also conducts motivational
and training seminars for its sales agents.
Organization - Travel Dynamics, L.L.C. was organized in March 1998 as an Arizona
limited liability company. The assets and liabilities of Travel Dynamics, L.L.C.
were transferred to Travel Dynamics, Inc., a Nevada corporation, on July 31,
1998. The assets and liabilities were recorded at their historical cost.
On September 29, 1998, Travel Dynamics, Inc. entered into a reorganization
agreement with Greenway Environmental Systems, Inc. ("Greenway") whereby the
shareholders of Travel Dynamics, Inc. exchanged all of the outstanding Travel
Dynamics, Inc. common shares for 2,000,000 common shares of Greenway. The
agreement was accounted for as the reorganization of Travel Dynamics, Inc. and
the acquisition of Greenway's assets in exchange for 1,236,072 shares of common
stock. Greenway did not have any operations and had only nominal assets at the
date of the agreement. Accordingly, the acquisition of Greenway's assets were
recorded at their historical cost of $10,010. In addition, Greenway changed its
name to Travel Dynamics, Inc. On a pro forma basis, assuming the reorganization
had occurred on March 1, 1998, net sales, net loss and basic and diluted loss
per share for the period from March 1, 1998 through December 31, 1998 would have
been $1,260,504, $(621,038) and $(0.21), respectively.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Interim Financial Statements - The accompanying consolidated financial
statements have been prepared by the Company and are unaudited. In the opinion
of management, all necessary adjustments (which include only normal recurring
adjustments) have been made to present fairly the financial position, results of
operations and cash flows for the periods presented. These financial statements
are condensed and, therefore, do not include all disclosures normally required
by generally accepted accounting principles. These financial statements should
be read in conjunction with the financial statements of Travel Dynamics, Inc.
and Travel Dynamics L.L.C. included in the current report on Form 8-K dated
October 13, 1998.
<PAGE>
Business Condition - The accompanying financial statements have been prepared in
conformity with generally accepted accounting principles, which contemplates
continuation of the Company as a going concern. However, the Company has
suffered losses from operations and has had negative cash flows from operating
activities during 1998 which conditions raise substantial doubt about the
Company's ability to continue as a going concern. The Company's continued
existence is dependent upon its ability to achieve profitable operations.
Management believes future operations will provide sufficient cash flows for the
Company to continue as a going concern.
Inventory - Inventory includes vacation travel discount packages and cruise
certificates. All inventory items are stated at the lower of cost (computed on a
first-in, first-out basis) or market value.
Property and Equipment - Property and equipment is recorded at cost and
depreciated over their estimated useful live of seven years, using the
straight-line method. Depreciation for the three and six months ended December
31, 1998 was $2,994 and $4,221, respectively.
Intangible and Other Assets - The cost of a marketing master data base has been
capitalized as intangible and other assets and is amortized over a five-year
period by the straight-line method. Amortization expense for the three and six
months ended December 31, 1998 was $1,961 and $2,615, respectively. The
reliability of intangible and other long-lived assets is evaluated periodically
when events or circumstances indicate a possible inability to recover the
carrying amount. An impairment loss is recognized for the excess of the carrying
amount over the fair value of the assets. Fair value is determined based on
estimated expected net future cash flows or other valuation techniques available
in the circumstances. The analyses necessarily involve significant management
judgement to evaluate the capacity of an asset to perform within projections.
Based upon these analyses, no impairment losses were recognized in the
accompanying financial statements.
Revenue Recognition - Revenue includes the cash sale of travel discount packages
and marketing seminars. The Company recognizes revenue for training seminars at
the date the customer participates in a seminar. Deferred revenues (seminar
deposits) represent amounts billed in advance of such participation.
Cost Recognition - Costs paid to organize the Company as well as costs paid in
connection with the reorganization described above were charged to operations
when incurred. Advertising costs are expensed as incurred. Advertising expense
was $4,009 and $10,018 for the three and six months ended December 31, 1998,
respectively.
Stock-Based Compensation - Stock-based compensation to employees is measured by
the intrinsic value method. This method recognizes compensation based on the
difference between the fair value of the underlying common stock and the
exercise price of the stock option on the date granted. Compensation relating to
options granted to non-employees is measured by the fair value of the options,
computed by an option pricing model.
<PAGE>
Basic and Diluted Loss Per Share -Basic loss per common share is computed by
dividing net loss by the number of weighted-average common shares outstanding
during the period. Diluted loss per share is calculated to give effect to
potentially issuable common shares except during loss periods when those
potentially issuable common shares would decrease the loss per share. There were
1,307,111 potentially issuable common shares which were excluded from the
calculation of diluted loss per common share.
NOTE 2 - REORGANIZATION OF TRAVEL DYNAMICS L.L.C.
The assets and liabilities transferred from Travel Dynamics L.L.C. at July 31,
1998 were accounted for at historical cost in a manner similar to that of
pooling of interests as follows:
Historical cost of assets $ 177,544
Short-term notes payable (195,000)
Deferred revenue (83,115)
----------
Net Liabilities Assumed $ (100,571)
==========
NOTE 3 - COMMITMENTS
Travel Dynamics entered into an agreement on June 26, 1998 with a business
consulting firm which agreement was mutually rescinded on October 17, 1998 and a
new agreement was entered into on October 19, 1998. Under the terms of the new
agreement, the consulting firm has provided services and benefits relating to
the reorganization of Travel Dynamics and the finding of Greenway and shall
provide services relating to Travel Dynamics' ongoing business activities.
Travel Dynamics has agreed to pay the consulting firm $5,000 as a non-refundable
retainer, $40,000 for assisting Travel Dynamics in the reorganization with
Greenway, $10,000 per month for a period of 24 months unless terminated earlier
by a 60-day notice of termination, reimbursement of out-of-pocket, printing, and
legal expenses, the cost to hire certain professionals on a temporary or
contract basis which may range from $1,500 to $2,500 per day to execute some of
the consulting firm's recommendations, and the issuance of common stock of
Travel Dynamics equal to 10% of all outstanding equity securities, computed on a
fully-diluted basis, until Travel Dynamics has raised up to $5,000,000 of
investment capital and/or entered into equivalent business combinations.
The consulting firm has been granted registration rights regarding their common
stock commencing nine months from the date of the agreement and piggyback
registration rights to register their stock as part of any other registration of
Travel Dynamics' equity securities. If Travel Dynamics merges with, acquires
assets or property from or obtains financing from any entity the consulting firm
introduces to Travel Dynamics, Travel Dynamics is obligated to pay the
consulting firm a finders' fee of 5% of the first $3,000,000, 4% of the next
$2,000,000 and 3% of the amount above $5,000,000 of the gross proceeds of the
transaction. The consulting firm shall be entitled to appoint one member of the
Board of Directors. The Company is obligated under the agreement to issue
404,008 shares of common stock to the consulting firm, based upon the common
stock presently outstanding. In addition, the Company has granted options to
purchase 1,000,000 shares of common stock which may require the Company to issue
an additional 111,111 shares of common stock to the consulting firm. There is no
market for the Company's common stock; however, management of the Company and
the consulting firm have determined that the fair value of the common stock at
the date of the agreement was $0.15 per share. The 404,008 shares of common
stock issued to the consulting firm were valued at $60,601 for purposes of these
financial statements.
<PAGE>
In connection with a three-year employment agreement with the Company's
President, the Company issued 400,000 shares of common stock on September 30,
1998 valued at $0.15 per share, or $60,000. In addition, cash compensation of
$250,000 per year will be paid to the President. The Company also granted the
President options to purchase 600,000 shares of commons stock at $0.10 per
share.
In connection with another three-year employment agreement with the Vice
President, the Company issued 250,000 shares of common stock on December 1, 1998
valued at $0.15 per share or $37,500. In addition, cash compensation of $150,000
per year will be paid to the Vice President.
NOTE 4 - STOCK OPTIONS
The Company has granted options to purchase 100,000 shares of common stock at
$0.10 per share to each of the four members of the Board of Directors. The
options vest at the rate of 25% upon being granted, and 25% per year over three
years. Compensation relating to the options granted to the Board of Directors is
recognized based upon the fair value of the options which is being recognized
over the vesting period.
The Company also granted options to the President of the Company in connection
with a three-year employment agreement. Options to purchase 600,000 shares of
commons stock at $0.10 per share were granted under the agreement. Options to
purchase 200,000 shares vested on the anniversary date of the agreement and an
additional 200,000 options vest each year of employment. Compensation relating
to these options is recognized based upon the intrinsic value of the options and
is being recognized over the period the options vest.
The Company entered into two agreements with consulting companies whereby each
of these companies were granted stock options. Under one agreement, one of the
consulting companies was granted options to purchase 100,000 shares of stock at
$0.10 per share. Options to purchase 30,000 shares vested upon execution of the
agreement and an additional 35,000 options vest on the anniversary date of the
agreement. Under the other agreement with a different company, options to
purchase 96,000 shares of stock at $0.10 per share were issued. 12,000 options
vest on February 28, 1999 with an additional 12,000 shares vesting every three
months thereafter. Compensation relating to these options is recognized based
upon the fair value of the options and is being recognized over the period the
options vest.
A summary of the status of the Company's stock options as of December 31, 1998
and changes during the period then ended are presented below:
Weighted-
Average
Shares Exercise Price
---------- --------------
Outstanding at beginning of period - $ -
Granted 1,196,000 0.10
--------- 0.10
Outstanding at period end 1,196,000 0.10
=========
Options exercisable at period end 130,000
=========
Weighted-average fair value of
options granted during the period $ 0.11
=========
<PAGE>
The Company measures stock-based compensation from options granted to
non-employees by the fair value method set forth under Statement of Financial
Accounting Standards No. 123, Accounting for Stock-Based Compensation and
measures compensation from options granted to employees using the intrinsic
value method prescribed in Accounting Principles Board Opinion 25, Accounting
for Stock Issued to Employees, and related Interpretations. Stock-based
compensation charged to operations was $3,000 during the period ended December
31, 1998. Had compensation cost for the Company's options granted to an employee
been determined based on the fair value at the grant dates consistent with the
alternative method set forth under Statement of Financial Accounting Standards
No. 123, Accounting for Stock-Based Compensation, net loss and loss per share
would have increased for the three and six months ended December 31, 1998 to the
pro forma amounts indicated below:
For the Three For the Six
Months Ended Months Ended
December 31, December 31,
1998 1998
------------- ------------
Neet loss:
As reported $ (212,391) $ (621,038)
Pro forma (217,891) (626,538)
Basic and diluted loss per share:
As reported $ (0.05) $ (0.21)
Pro forma (0.05) (0.21)
The fair value of each option granted was estimated on the date of grant using
the Black-Scholes option-pricing model with the following weighted-average
assumptions: underlying common stock value - $0.15, expected life of the options
- - 5 years, expected volatility - 75% and risk-free interest rate - 4.4%.
NOTE 5-SUBSEQUENT EVENTS
On January 1, 1999, the Company entered into employment agreements with three
non-executive employees. Each of these employment agreements are for three years
and may be automatically renewed for an additional year. In connection with
these employment agreements, the Company granted each individual options to
purchase 25,000 shares of common stock at $0.15 per share. On the anniversary
date of each individual's employment, they shall receive an additional 10,000
options to purchase common stock at $0.15 per share. The cash compensation to be
paid to these individuals totals $354,000. The Company has also agreed to pay
relocation costs of two of the individuals up to $20,000 per individual. The
third individual is to receive an additional 10,000 options to purchase common
stock at $0.15 per share as payment for compensation.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------------------------------------------------------------------------
RESULTS OF OPERATIONS.
- ----------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS MAY CONTAIN FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS ANd UNCERTAINTIES. THE STATEMENTS CONTAINED IN
THIS 10-QSB REPORT ThAT ARE NOT PURELY HISTORICAL ARE FORWARD-LOOKING STATEMENTS
WITHIN THE MEANING OF SECTION 21E OF THE EXCHANGE ACT, INCLUDING, WITHOUT
LIMITATION, STATEMENTS REGARDING THE COMPANY'S EXPECTATIONS, BELIEFS, EStIMATES,
INTENTIONS, AND STRATEGIES ABOUT THE FUTURE. WORDS SUCH AS, "aNTICIPATES,"
"EXPECTS," "INTENDS," "PLANS," "BELIEVES," "SEEKS," "ESTImATES," OR VARIATIONS
OF SUCH WORDS AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY SUCH
FORWARD-LOOKING STATEMENTS, BUT THEIR ABSENCE DOeS NOT MEAN THE STATEMENT IS NOT
FORWARD-LOOKING. THESE STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND
ARE SUBJECT TO CeRTAIN RISKS, UNCERTAINTIES, AND ASSUMPTIONS THAT ARE DIFFICULT
TO PReDICT; THEREFORE, ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPrESSED
OR FORECASTED IN ANY SUCH FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN
FACTORS.
(A) OPERATIONS & LIQUIDITY - THE FINANCIAL STATEMENTS AND
BUSINESS OPERATIONS OF TRAVEL DYNAMiCS, INC. ("TDI" AND FORMALLY KNOWN AS
GREENWAY ENVIRONMENTAL SYSTEmS, INC. "GREENWAY") CAN NOT BE UNDERSTOOD APART
FROM THE RECENT REORGANIZATION OF GREENWAY TO BECOME KNOWN AS TDI THROUGH THE
ACQUISITiON OF TRAVEL DYNAMICS, INC. AS A WHOLLY OWNED AND EXCLUSIVE OPERATING
SUBSIDIARY, WHICH SUBSIDIARY IS NOW KNOWN AS TRAVEL DYNAMIC SERVICES, INC.
("TDSI").
AS CURRENTLY CONSTITUTED, THE PRIOR PUBLIC ENTITY, GREENWAY, IS NOW
KNOWN AS TRAVEL DYNAMICS, INC. (TDI) WHICH HAS A SINGULAR ACQUIRED OPERATING
SUBSIDIARY PRIMARILY ENGAGED IN THE PURCHASE AND RETAIL MARKETING, THROUGH
INDEPENDENT AGENTS, OF VARIOUS TRAVEL PACKAGES AND THE OPERATION OF TRAVEL
MARKETING sEMINARS. THIS OPERATING COMPANY, TRAVEL DYNAMICS SERVICES, INC.
(TDSI), ACTS AS THE SOLE OPERATING DIVISION AND SUBSIDIARY FOR THE PARENT
COMPANY, (TDI).
3
<PAGE>
ON SEPTEMBER 29, 1998, A FORMAL REVERSE ACQUISITION AGREEMENT WAS
CLOSED BY WHICH ALL OF THE ISSUED AND OUTSTANDING SHARES OF THE PRIOR TRAVEL
DYNAMICS, INC. WERE ACQUIRED BY GREENWAY, WITH GREENWAY THEN CHANGING ITS NAME
TO TRAVEL DYNAMICs, INC. AND THE ACQUIRED SUBSIDIARY CHANGING ITS NAME TO TRAVEL
DYNAMIC SERVICES, INC. THE ACQUIRED ENTITY THEN WAS ALLOWED TO NOMINATE FROM ITs
MEMBERS THE NEW BOARD OF DIRECTORS FOR THE PARENT COMPANY GREENWAY/TDI, WHICH
THEN SUBSEQUENTLY APPOINTED OFFICERS.
THE PRINCIPAL BUSINESS THEN BECAME THE CONTINUING ASSEMBLY AND
MARKETING OF TRAVEL PACKAGES (CONSIStING OF TRAVEL, LODGING, AND USUALLY A
RENTAL CAR OR OTHER CONCESSIONS FoR ENTERTAINMENT) WHICH ARE SOLD AS A PACKAGE
UNIT AFTER ACQUISITION AnD ASSEMBLY BY THE COMPANY THROUGH VARIOUS INDEPENDENT
SALES AGENTS. ThE COMPANY ATTEMPTS TO MAKE A PROFIT BY RE-SELLING THE VARIOUS
TRAVEL CoMPONENTS AS A TRAVEL PACKAGE ON A MARK-UP BASIS TO THE VARIOUS
INDEPENDENT AGENTS. THE AGENTS THEN ATTEMPT TO RE-SELL THE TRAVEL PACKAGE AT A
RETAIL LEVEL FOR A PROFIT.
SECONDARILY, THE COMPANY ENGAGES IN THE ORGANIZATION AND HOSTING OF
VARIOUS TRAVEL MARKETING SEMINARS rELATED TO THE FOREGOING MARKETING PLAN ON A
PROFIT BASIS.
THIRDLY, THE COMPANY IS GAINING INCREASING REVENUES THROUGH VARIOUS
DIRECT INTERNET MARKETING ACTIVITIES.
THE FOREGOING GENERAL DESCRIPTION OF BUSINESS IS MORE PARTICULARLY SET
OUT IN THE LAST FILED 10-KSB REPORT FOR THE COMPANY WHICH WAS FILED AS OF
OCTOBER 23, 1998. A COPY OF ThIS FILING WILL BE MADE AVAILABLE BY THE COMPANY TO
ANY SHAREHOLDER REQUESTING THE SAME, OR TO OTHER INTERESTED PARTIES. ALL FILED
DOCUmENTS OF THE COMPANY MAY FURTHER BE RETRIEVED "ON LINE" THROUGH THE INTERNET
AT THE SEC HOMEPAGE AT:
HTTP://WWW.SEC.GOV.
THE FOLLOWING WERE APPOINTED AND ELECTED PURSUANT TO THE REORGANIZATION
AND PRESENTLY CONsTITUTE THE CURRENT OFFICERS AND DIRECTORS OF THE COMPANY:
(A) JAMES PICCOLO, PRESIDENT, DIRECTOR
(B) BRIAN K SERVICE, EXECUTIVE DIRECTOR
(C) THOMAS (TOM) DENNIS, DIRECTOR
(D) GARY DAVIES, DIRECTOR
(E) THOMAS VERGITH, DIRECTOR
OTHER PRINCIPAL OFFICERS WHO ARE NOT DIRECTORS
INCLUDE:
(A) JOHN P. PICCOLO, VICE PRESIDENT
(B) MELINDA FEHRINGER, SECRETARY,
TREASURER & CFO
BIOGRAPHICAL INFORMATION, SHAREHOLD INTEREST AND
COMPENSATION PERTAINING TO THE FOREGOING OFFICERS AND
DIRECTORS IS CONTAINED IN THE LAST FILED 10-KSB
REPORT OF THE COMPANY AND WAS CURRENT AS OF THAT
DATE.
4
<PAGE>
ALL CURRENT DEBTS AND OBLIGATIONS OF THE PRIOR GREENWAY ENVIRONMENTAL
SYSTEMS WERE PAID OR oTHERWISE DISCHARGED AS OF THE TIME OF THE COMPLETION OF
THE REVERSE ACQUISITION.
THE PLACE OF OPERATION OF THE BUSINESS CHANGED TO THE PRINCIPAL PRIOR
BUSINESS LOCATION OF TRAVEL DYnAMICS, INC. IN SCOTTSDALE, AZ. THE COMPANY HAS
ASSUMED, AS ITS SOLE OPERATIONS, THE FORM OF BUSINESS PRESENTLY CONDUCTED BY
TRAVEL DYNaMIC SERVICES, INC., AS DESCRIBED
ABOvE.
IN REVIEWING THE STATEMENT OF OPERATIONS FOR THE COMPANY, IT SHOULD BE
UNDERSTOOD THAT THE ACQUIRED OPERATING SUBSIDIARY IS ITSELF A START- UP ENTITY
WHICH WAS ORGANIZED ONLY IN MARCH OF 1998 AS AN ARIZONA LIMITED LIABILITY
COMPANY. ON JULy 31, 1998, THE MEMBERS OF THE LLC TRANSFERRED THEIR INTERESTS
FOR CASH TO THE ACQUIRED SUBSIDIARY ENTITY, THEN KNOWN AS TRAVEL DYNAMICS, INC.
AND WHICH HAS NOW BECOME TRAVEL DYNAMICS SERVICES, INC., THE oPERATING
SUBSIDIARY COMPANY.
THERE IS, AS OF DECEMBER 31, 1998, COMBINED TOTAL ASSETS OF $429,274;
CURRENT LIABILITIES OF $512,484 RESULTING IN A NEGATIVE STOCKHOLDER EQUITY OF
($83,210) IN THE COMPANY. FOR THE THREE MONTH PERIOD ENDING DECEMBER 31, 1998,
THE COMPANY HAD NET LOSSES OF ($212,391), WHICH ARE LARGELY ATTRIBUTABLE TO
START-UP COSTS. NET LOSSES FOR THE PRECEDING AND START-Up QUARTER ENDING
SEPTEMBER 30, 1998, WERE ($408,647). NET LOSSES FOR THE SIX MONTHS ENDING
DECEMBER 31, 1998, WERE ($621,038).
SALES FOR THE SIX MONTHS ENDED DECEMBER 31, 1998 WERE $1,260,504. THIS
COMPARES TO SALES FOR THE QUARTER ENDING SEPTEMBER 30, 1998 OF $769,990. SINCE
CURRENT OPERATIONs ESSENTIALLY BEGAN IN JULY, 1998, THERE ARE NO COMPARABLE
SALES OR OPERATIONS FOR THE PRIOR YEAR.
COST OF SALES IN THE QUARTER ENDING DECEMBER 31, 1998, WERE $480,626 OR
APPROXIMATELY 62% OF SALES. THE RESULTING GROSS PROFIT WAS $289,364 OR
APPROXIMATELY 38% OF SALES. GENERAL AND ADMINISTRATIVE EXPENSES OF $501,755 FOR
THIS PERIOD RESULTING IN THE QUARTERLY NET LOSS OF ($212,391) OR APPROXIMATELY
($0.05) PER SHARE.
THE COMPANY IN THE SIX MONTHS ENDING DECEMBER 31, 1998, PAID $75,000 TO
ITS CONSULTANTS AND ISSUED TO SUCH THIRD PARTIES 404,008 SHARES OF RESTRICTED
COMMON STOCK PURSUANT TO A PRIOR AGREEMENT. THE CONSULTANTS ALSO ACQUIRED THE
RIGHT TO BE ISSUED ADDITIONAL SHARES, WITHOUT CONSIDERATION, SO THAT THEIR
SHAREHOLD INTEREST WOULD EQUAL TEN PERCENT OF ALL ISSUED AND OUTSTANdING SHARES
UNTIL THE COMPANY HAD RAISED $5,000,000 IN NEW CAPITAL. As OF THIS REPORT, NO
NEW SHARES HAVE BEEN ISSUED UNDER THIS CONTINUING RIGHT. FINALLY, THE
CONSULTANTS HAVE AN OPTION TO ACQUIRE UP TO AN ADDItIONAL 111,111 SHARES AT
$0.15 PER SHArE.
MANAGEMENT COMPENSATION FOR THE SIX MONTHS ENDING DECEMBER 31, 1998,
INCLUDING SIGNING BONUSES, AGGREGATED $108,000 OR 8.5% OF REVENUES. MANAGEMENT
ALSO RECEIVED 650,000 SHARES OF STOCK, AND OPTIONS TO ACQUIRE 1,096,000 SHARES
AT AN eXERCISE PRICE OF $0.10/SHARE. IF FULLY EXERCISED, MANAGEMENT SHARES AND
OPTIONS WOULD CONSTITUTE APPROXIMATELY 32% OF ALL PRESENTLY ISSUED AND
OUTSTANDING STOCK WHEN ADDED TO THE CURRENTLY ISSUED AND OUTSTANDING STOCK OF
THE COMPANY.
5
<PAGE>
THE FOLLOWING CHART ATTEMPTS TO SUMMARIZE THE CURRENT SHARE/OPTION
HOLDINGS OF MANAGEMENT, AS WELL AS COMPENSATIONS AS OF DECEMBER 31, 1998:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
NAME POSITION NO. OF STOCK SUBJECT TOTAL ANNUAL
SHARES TO VESTED OR MONETARY
FUTURE OPTION COMPENSATION
RIGHTS1
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
JIM PICCOLO PRESIDENT/ 400,000 600,000 $250,000
DIRECTOR
- ------------------------------------------------------------------------------------------------------------
BRIAN MANAGING 0 196,000 PER DIEM2
SERVICE DIRECTOR
- ------------------------------------------------------------------------------------------------------------
THOMAS DIRECTOR 0 100,000 PER DIEM
DENNIS
- ------------------------------------------------------------------------------------------------------------
GARY DAVIES DIRECTOR 0 100,000 PER DIEM
- ------------------------------------------------------------------------------------------------------------
THOMAS DIRECTOR 0 100,000 PER DIEM
VERGITH
- ------------------------------------------------------------------------------------------------------------
JOHN PICCOLO VICE 0 0 $60,000
PRESIDENT
- ------------------------------------------------------------------------------------------------------------
MELINDA SECRETARY/ 0 0 $42,500
FEHRINGER TREASURER/
CFO
- ------------------------------------------------------------------------------------------------------------
MARY JONTZ VICE 250,000 0 $150,000
PRESIDENT
MARKETING/
TRAINING
- ------------------------------------------------------------------------------------------------------------
</TABLE>
1 THE OPTIONS COUNTED FOR MR. SERVICE INCLuDE OPTIONS FOR 96,000 SHARES GRANTED
TO A RELATED CONSULTING COMPANY, B.K. BUSINESS SERVICES. THE FOREGOING
MANAGEMENT CHART DOES NOT DESCRIBE OPTIONS TO THIRD PARTY CONSULTANTS, OR
OPTIONS TO ACQUIRE UP TO 175,000 SHARES GRANTED TO NON-MANAGEMENT EMPLOYEES
SINCE DECEMBER 31, 1998.
2 DIRECTORS ARE NOT PAID A SALARY, BUT RECEIVE A PER DIEM ALLOWANCE (CURRENTLY
$1,000 PER MEETING) FOR ATTENDaNCE AT BOARD MEETINGS.
IN ALL EVENTS, THE COMPANY HAS DETERMINED THAT ALL PRESENT MANAGEMENT
OPTIONS SHALL BE CONDITIONALLY GRANTED AND MY NOT BE EXERCISED WITHOUT
SUBSEQUENT SHAREHoLDER RATIFICATION. SEE DISCUSSION UNDER ITEM 5 BELOW.
UNTIL THE COMPANY ACHIEVES A SUSTAINED LEVEL OF PROFITABILITY, IT MUST
BE CONSIDERED A START-UP ENTITY. WHILE MANAGEMENT CONSIDERS THE GROWTH OF
REVENUES TO BE POSITIVE, MANAGEMENT IS UNABLE TO MAKE ANY CURRENT PROJECTION OF
WHEN, OR IF, PROFITABILITY WILL BE OBTAINED.
6
<PAGE>
FROM ITS TWO PRIMARY MARKET SEGMENTS, THE COMPANY REALIZED $794,118 IN
REVENUES OR 63% FROM THE SALES OF ITS TRAVEL PACKAGES AND $214,286 OR 17% FROM
ITS TRAVEL SEMINARS IN THE SIX MONTH ENDING DECEMBER 31, 1998. MISCELLANEOUS
REVENUES, INCLUDInG DIRECT INTERNET SALES, WOULD CONSTITUTE REVENUES OF $252,101
OR 20% FOR THIS PERIOD. IN THIS SAME PERIOD, THE COMPANY REALIZED GROSS pROFIT
MARGINS OF 34% ON THE TRAVEL PACKAGES, 21% FROM ITS SEMINAR ACTIVITIES, AND 66%
FROM MISCELLANEOUS REVENUE ACTIVITIES. MANAGEMENT WOULd REASONABLY PROJECT
SIMILAR MARGINS FOR THE NEXT QUARTER.
THE COMPANY IS MARGINALLY CAPITALIZED TO CARRY ON ITS INTENDED
ACTIVITIES AND WILL BE DEPENDENT UPON CONTINUING CASH FLOWS TO MEET OPERATING
EXPENSES. NO ASSURANCE Of FINANCIAL SUCCESS OR THE ECONOMIC SURVIVAL OF THE
ENTERPRISE CAN BE AsSURED DURING THIS START-UP PERIOD. IN THIS REGARD, THE
INDEPENDENT AUDiTORS FOR THE COMPANY HAVE STATED A "GOING CONCERN" RESERVATION.
IT SHOULD ALSO BE NOTED THAT AS A START UP ENTITY, THE COMPANY HAS AND
WILL NECESSARILY CONTINUE TO INCUR CERTAIN TYPES OF START UP COSTS, INCLUDING
COSTS RELATED TO THE COmMENCEMENT OF BUSINESS, LEGAL AND ACCOUNTING FEES,
INITIAL FILING FEES, AND ADVERTISING AND MARKETING FEES WHICH MAY NOT CONSTITUTE
ONGOING FEES; OR, IF ONGOING, MAY NOT BE INCURRED AT THE SAME LEVEL OR
PERCEnTAGE OF REVENUES AS EXPERIENCED IN THE START-uP PERIOD.
MANAGEMENT'S GENERAL DISCUSSION OF OPERATIONS IS LIMITED BY AND SHOULD
BE CONSIDERED WITHIN THE CONTEXT OF THE ACTUAL FINANCIAL STATEMENTS AND NOTES
ATTACHED THEREtO AND INCORPORATED AS PART OF ITEM 1 ABoVE.
(B) YEAR 2000 DISCLOSURE - AS MANY OF OUR SHAREHOLDERS AND
OTHER INTERESTED PARTIES MAY BE AWARe, THERE IS SIGNIFICANT CONCERN THAT CERTAIN
COMPUTER PROGRAMS AND COMPUTERS ARE NOT PRESENTLY CONFIGURED TO RECOGNIZE THE
YEAR 2000 OR SUCCEEDING YEARS. THIS DEFECT IN COMPUTER FUNCTIONS COULD HAVE A
SERIOUS ADVERSE IMPACT UPON YOUR COMPANY AND OTHER INDUSTRIES IF VARIOUS
COMPUTER PROGRAMS AND APPLICATIONS CEASE TO FUNCTION OR FUNCTION ERRONEOUSLy AS
WE APPROACH THE YEAR 2000.
BY WAY OF PRACTICAL ILLUSTRATION, SOFTWARE PROGRAMS DEALING WITH
ACCOUNTING AND BANKING FUNCTIONS WIThIN THE COMPANY COULD MISFUNCTION OR CEASE
TO FUNCTION IF NOT YEAR 2000 COMPLIANT. THE COMPANY VIEWS THE YEAR 2000, OR Y2K,
COMPLIANCE PROBLEMS IT MAY FACE TO FALL WITHIN THREE GENERAL CATEGORIES:
(1) THE POTENTIAL IMPACT ON THE COMPANY'S OWN INFORMATION
TECHNOLOGY (IT SYSTEMS) CONSISTING OF STAND ALONE COMPUTERS AND THEIR INTEGRAL
sOFTWARE.
(2) THE POTENTIAL IMPACT OF THE POSSIBILITY OF COLLATERAL
FAILURE OR MISFUNCTION IN NON-IT SYSTEMS DUE TO THEIR COMPUTER COMPONENTS SUCH
AS TELEPHONE SYSTEMS, SECURITY SYSTEMS, COMPANY VEHICLEs, ETC.
7
<PAGE>
(3) THE POTENTIAL ADVERSE EFFECT UPON THE COMPANY FROM YEAR
2000 FAILURE AMONG THIRD PARTY SERVICE AND PRODUCT SUPPLIERS UPON WHICH THE
COMPANY DEPENDS FOR ITS CORE TRAVEL PRODUCTS AND SERVICES. THE THIRD PARTIES
WOULD INCLUDE, THOUGH ARE NOT LIMITED TO, CRUISE LINES, TRAVEL COMPANIES,
AIRLINES, AND GOVeRNMENTALLY OWNED OR MANAGED TRAVEL FACILITIES SUCH AS
AIRPORtS, TERMINALS, AND DOCKS.
THE COMPANY BELIEVES IT IS ADDRESSING ITS YEAR 2000 PROBLEMS RELATED TO
ITS OWNED OR LEASED IT sYSTEMS. THE COMPANY HAS RECENTLY HIRED AN IN-HOUSE IT
SPECIALIST WHO WILL COMPLETE REVIEWS AND UPDATES, WITHIN THE NEXT 90 DAYS, OF
ALL COMPANY OPERATING SYSTEMS AND PROGRAM APPLICATIONS TO INSURE THEY ARE Y2K
COMPLIANT OR THEY WILL BE UPGRADED TO BE COMPLIANT, OR ALTERNATIVE COMPLIANT
SYSTEMS OR SOFTWARE ACQUIRED. PRELIMINARILY, IT APPEARS THAT MOST OF THE
COMPANY'S CURRENT OPERATING SYSTEMS WERE ACQUIRED RECENTLY EnOUGH TO BE FULLY
Y2K COMPLIANT.
AS TO NON-IT SYSTEMS, THE COMPANY IS REVIEWING WITH ITS TELEPHONE, FAX,
AND OTHER VENDORS IF THERE ARE ANY ANTICIPATED PROBLEMS OR UPDATES REQUIRED FOR
Y2K COMPLIANCE. PRELImINARILY, THE COMPANY HAS BEEN TOLD THERE SHOULD BE NO
PROBLEM WITH THESE NON-IT SYSTEMS.
THE COMPANY IS MOST CONCERNED WITH POTENTIAL Y2K PROBLEMS IN ITS THIRD
PARTY PRODUCT AND SERVICE PROVIDERS SUCH AS CRUISE LINES, HOTEL COMPANIES, AND
AIRLINES FROM WHOM IT PURCHASES AND ASSEMBLES THE TRAVEL PACKAGES IT RESELLS TO
INDEPENDENT SaLES AGENTS. IT IS POSSIBLE UNCURED Y2K PROBLEMS IN THE
TELECOMMUNICAtIONS INDUSTRIES, OR AMONG TRAVEL PROVIDERS, COULD SUBSTANTIALLY
ImPAIR OR SHUT DOWN THE COMPANY'S OPERATIONS. FURTHER, THE COMPANy DOES NOT
BELIEVE IT HAS OR MAY EXERCISE ANY REALISTIC CONTROL OVER, OR PROVIDE ANY
ASSISTANCE TO THESE THIRD PARTY PROVIDERS.
WHILE IT IS TOO PRELIMINARY TO FULLY ASSESS THE COMPANY'S COST OF Y2K
COMPLIANCE, PRELIMINARY INDICATIONS ARE THAT THE COMPANY WILL INCUR LITTLE COSTS
IN UPGRADING INTeRNAL IT SOFTWARE OR SYSTEMS.
THE ANTICIPATED COSTS TO THE COMPANY WILL BE PRIMARILY THE SALARY AND
OTHER COMPENSATION PAID TO THE IT COMPLIANCE OFFICER. SINCE THE COMPLIANCE
OFFICER WILL HAVE OTHER CORPORATE DUTIES, IT IS DIFFICULT TO ESTIMATE DIRECT
COSTS, BUT THEY ARE bELIEVED TO BE LESS THAN $15,000 PER ANUM.
THE COMPANY'S PLANS TO DEAL WITH POTENTIAL Y2K PROBLEMS ARE AS OUTLINED
ABOVE. THE COMPANY BELIEVEs THE PLANNING IS ADEQUATE TO HANDLE ANY INTERNAL Y2K
PROBLEMS, IT DOES NOT BELIEVE IT CAN DEVELOP ANY REALISTIC CONTINGENCY PLAN TO
ADEQUAtELY DEAL WITH POTENTIAL THIRD PARTY Y2K PROBLEMS.
8
<PAGE>
PART II. - OTHER INFORMATION
----------------------------
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- -----------------------------------------------------------
NO MATTERS WERE REQUIRED TO BE SUBMITTED TO SHAREHOLDER VOTE DURING THE
QUARTER ENDING DECEMBER 31, 1998 OR ARE ANTICIPATED TO BE SUBMITTED DURING THE
FIRST QUARTER OF 1999. HOWEVER, DURING THE QUARTER ENDING DECEMBER 31, 1998 THE
BOARD HAS ADOPTED A COMPREHENSIVE QUALIFIED EMPLOYEE INCENTIVE STOCK OPTION PLAN
AS GENERALLY DESCRIBED ABOVE UNDER DISCUSSION OF MANAGEMENT OPTIONS.
IF PRESENTLY EXERCISED, THESE OPTION SHARES WOULD CONSTITUTE
APPROXIMATELY 22% OF THE CURRENTLY ISSUED SHARES WHEN AGGREGATED WITH ALL OTHER
CURRENTLY ISSUED SHARES. SINCE THE INCENTIVE OPTIONS COULD NOT BE ADOPTED BY
DISINTERESTED DIREcTORS, THE DIRECTORS HAVE DECIDED TO CONDITIONALLY GRANT THE
MANAGEMENT OPTIONS SUBJECT TO SHAREHOLDER RATIFICATION OR REJECTION OF THE
INCeNTIVE STOCK OPTION PLAN AT THE NEXT SHAREHOLDERS' GENERAL MEETING. No DATE
FOR THE NEXT SHAREHOLDERS' MEETING HAS BEEN SET.
ITEM 5. - OTHEr INFORMATION.
- ----------------------------
THE COMPANY KNOWS OF NO OTHER MATERIAL INFORMATION OTHER THAN AS
DESCRIBED AND SET OUT ABOVE AND UNDER THIS ITEM 5. FOR THE INTERIM PERIOD, THE
COMPANY WILL BE ENGAGED IN ATTEMPTING TO ASSIMILATE CHANGES RESULTING FROM THE
REORGANIZATION AND TO WORK TO ACHIEVE A LEVEL OF PROFITABLE oPERATIONS.
THE COMPANY FURTHER NOTES THAT ACTIVE TRADING IN ITS STOCK COMMENCED IN
JANUARY, 1999 UNDER THE TRADING SYMBOL "TDNM" AFTER SUBMISSION TO AND CLEARANCE
BY THE NATIONAL ASSOCIATION OF SECURITIES DEALERS (NASD). CLEARANCE FOR TRaDING
SHOULD NOT IN ANY MANNER BE CONSTRUED AS AN ENDORSEMENT OR REVIeW OF THE COMPANY
BY THE NASD OR BY ANY MEMBER BROKER/DEALER, OR BY THE SECURITIES AND EXCHANGE
COMMISSION. ALPINE SECURITIES OF SALT LAKE CITY, UTAH, WAS THE SUBMITTING
BROKER. THE HIGH AND LOW TRADES DURING JANUARY WERE $6.00 AND $3.00.
THE COMPANY IS ALSO PLANNING ON MOVING FORWARD WITH A PRIVATE PLACEMENT
AT SOME POINT WITHIN THE fIRST SIX MONTHS OF 1999 OF SOME OF ITS AUTHORIZED
COMMON STOCK TO PROViDE NEEDED CAPITAL FOR THE COMPANY. NO TERMS OF THIS
OFFERING HAVE BEEN FIXED, EXCEPT THAT GROSS PROCEEDS WILL NOT EXCEED $1.5
MILLION. ANY SHAREHOLDER WISHING A COPY OF THE PROPOSED PRIVATE PLACEMENT
OFFERING MEMORANDUM CAN OBTAIN A COPY FROM THE COMPANY UPON REQUEST AS
COMPLETeD. THE COMPLETION OF THIS PRIVATE PLACEMENT MAY HAVE A DILUTIVE IMPAcT
UPON CURRENT SHAREHOLDERS IN AN AMOUNT NOT PRESENTLY DETERMINED, BUT WHICH
SHOULD BE DISCUSSED IN THE PRIVATE PLACEMENT OFFERING.
9
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
- ------------------------------------------
(1) THE ATTACHED UNAUDITED FINANCIALS FOR THE PERIOD ENDING DECEMBER
31, 1998, ARE ATTACHED AND INCORPORATED AS PART I.
(2) THE COMPANY MADE NO 8-K FILINGS IN THE QUARTER ENDING DECEMBER 31,
1998.
..........................
OTHER EXHIBITS:
NONE
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.
TRAVEL DYNAMICS, INC.
DATE: FEBRUARY 12, 1999 BY
---------------------------
JAMES PICCOLO
PRESIDENT/DIRECTOR
DATE: FEBRUARY 12, 1999 BY
----------------------------
MELINDA FEHRINGER
SECRETARY/TREASURER
TDI/4QTR98.10Q CHIEF FINANCIAL OFFICER
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The following FDS statement is limited by and subject to the more complete
Financial statement concurrently submitted.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 5978
<SECURITIES> 0
<RECEIVABLES> 80363
<ALLOWANCES> 147567
<INVENTORY> 8807
<CURRENT-ASSETS> 242715
<PP&E> 190780
<DEPRECIATION> (4221)
<TOTAL-ASSETS> 429274
<CURRENT-LIABILITIES> 512484
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (83210)
<TOTAL-LIABILITY-AND-EQUITY> 429274
<SALES> 769990
<TOTAL-REVENUES> 769990
<CGS> 480626
<TOTAL-COSTS> 480626
<OTHER-EXPENSES> 501355
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (212391)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (212391)
<EPS-PRIMARY> (0.05)
<EPS-DILUTED> (0.05)
</TABLE>
