UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[xx] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
-------------------------------
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 33-26782-NY
U.S. Bridge Corp.
(Exact name of registrant as specified in its charter)
Delaware 11-2974406
(State or other jurisdiction of (I.R.S. Employer incorporation or
Identification No.) organization)
53-09 97th Place, Corona, New York 11368
(Address of principal executive offices) (Zip Code)
(718) 699-0100
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) has 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 [xx] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Common stock, par value $.001 per share: 6,412,530 shares outstanding as of
December 31, 1996.
<PAGE>
U.S. BRIDGE CORP.
INDEX
<TABLE>
<CAPTION>
PART 1 - FINANCIAL INFORMATION:
ITEM 1 - FINANCIAL STATEMENTS
<S> <C>
Consolidated Balance Sheets December 31, 1996 (Unaudited)
and June 30, 1996 .......................................... F-1
Consolidated Statements of Operations (Unaudited) for the
Three Months Ended December 31, 1996 and 1995 ............................ F-2
Consolidated Statements of Operations (Unaudited) for the
Six Months Ended December 31, 1996 and 1995 ............................. F-3
Consolidated Statement of Stockholders' Equity (Unaudited) for
the Six Months Ended December 31, 1996 F-4
Consolidated Statements of Cash Flows (Unaudited) for the
Six Months Ended December 31, 1996 and 1995 F-5
Notes to consolidated Financial Statements F-6 - F-16
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS F-17 - F-19
PART II - OTHER INFORMATION F-20
</TABLE>
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(Unaudited)
December 31, June 30,
1996 1996
---- ----
ASSETS
Current assets:
<S> <C> <C>
Cash .................................................................... $ 377,032 $ 399,652
Contracts and retainage receivable, net ................................. 6,880,663 3,613,665
Costs and estimated earnings in excess of billings
on uncompleted contracts ............................................... 1,072,000 2,433,524
Other current assets .................................................... 18,178 55,116
Total current assets ............................................... 8,347,873 6,501,957
Property and equipment, net ................................................. 2,955,440 3,042,090
Deferred Compensation ....................................................... 11,000 33,000
Deferred consulting costs, net .............................................. 239,583 239,583
------------ ------------
Total assets ................................................................ $ 11,553,896 $ 9,816,630
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable, including cash overdrafts of $123,427
and $63,274, respectively $ ............................................ 1,908,076 $ 936,445
Accrued expenses ........................................................ 558,718 397,729
Payroll taxes payable ................................................... 537,564 382,135
Mortgage payable ........................................................ 2,735,531 2,735,531
Notes payable ........................................................... 145,837 145,837
Due to officer and related parties ...................................... 488,311 358,779
Billings in excess of costs and estimated earnings
on uncompleted contracts ............................................... 7,710 16,567
Total current liabilities .......................................... 6,381,747 4,973,023
Minority interest ........................................................... 2,688,793 2,409,028
Commitments and contingencies (Note 7) ...................................... -- --
Stockholders' equity:
Preferred stock, authorized 10,000,000, issued and outstanding -0- shares -- --
Common stock, $.001 par value, authorized 50,000,000 shares,
issued and outstanding 6,412,530 and $6,162,530, respectively .......... 6,016 5,766
Additional paid-in capital .............................................. 2,790,752 2,641,002
Accumulated deficit ..................................................... (313,412) (212,189)
Total stockholders' equity ......................................... 2,483,356 2,434,579
Total liabilities and stockholders' equity .................................. $ 11,553,896 $ 9,816,630
</TABLE>
See notes to consolidated financial
statements (unaudited).
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
----------- -------
Revenue:
<S> <C> <C>
Contract revenues ................................................. $ 2,631,390 $ 930,094
Total revenue ..................................................... 2,631,390 930,094
Costs and expenses:
Cost of contract revenues ......................................... 1,844,404 204,943
General and administrative expenses ............................... 791,373 685,439
Total costs and expenses .......................................... 2,635,777 890,382
Loss from operations before interest expense,
minority interest and provision for income taxes ................. (4,387) 39,712
Interest expense .................................................. 78,752 128,845
(Loss) income from operations before minority interest
and provision for income taxes ................................... (83,139) (89,133)
Minority interest in net (income) loss ............................ (76,745) 47,241
Net (loss) income before provision for income taxes ............... (159,884) (41,892)
Provision for income taxes ........................................ -- --
</TABLE>
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31,
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
---------- ----
Revenue:
<S> <C> <C>
Contract revenues ........................................... $ 5,807,441 $ 2,556,987
Rental income ............................................... -- 82,000
----------- -----------
Total revenue ............................................... 5,807,441 2,638,987
----------- -----------
Costs and expenses:
Cost of contract revenues ................................... 4,014,117 1,203,447
General and administrative expenses ......................... 1,459,784 1,372,286
----------- -----------
Total costs and expenses .................................... 5,473,901 2,575,733
----------- -----------
Income from operations before interest expense, unusual item,
minority interest and provision for income taxes ........... 333,540 63,254
Interest expense from operations ............................ 154,998 289,675
Unusual financing costs ..................................... -- 441,863
----------- -----------
Income (loss) from operations before minority interest
and provision for income taxes ............................. 178,542 (668,284)
Minority interest in net (income) loss ...................... (279,765) 86,068
----------- -----------
</TABLE>
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Common
stock
Additional Total
paid-in Accumulated Stockholders'
Shares Amount capital deficit equity
<S> <C> <C> <C> <C> <C>
Balances at July 1, 1996 ........................... 6,162,530 $5,766 $2,641,002 $(212,189) $2,434,579
Issuance of common stock as
consideration for services
provided to the Company ........................... 250,000 250 149,750 -- 150,000
Net loss for the six months ended
December 31, 1996 ................................. -- -- -- (101,223) (101,223)
Balances at December 31, 1996 ...................... 6,412,530 $6,016 $2,790,752 $(313,412) $2,483,356
</TABLE>
See notes to consolidated financial statements (unaudited)
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED DECEMBER 31,
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
Operating activities:
<S> <C> <C>
Net loss $(101,223) $(582,216)
Adjustments to reconcile net loss to net cash (used) for operating activities:
Depreciation and amortization 242,327 90,000
Amortization of consulting costs 22,000 125,000
Issuance of common stock as consideration for services - 16,500
Amortization of financing costs - 441,863
Minority interest in net income (loss) 279,765 (86,068)
Changes in operating assets and liabilities:
Accounts receivable (3,266,998) (146,652)
Prepaid expenses (10,996) (114,130)
Costs and estimated earnings in excess of
billing on uncompleted contracts 1,361,524 (567,734)
Other current assets 47,934 16,751
Accounts payable 971,631 (108,725)
Accrued expenses 160,989 (260,979)
Payroll taxes payable 155,429 (61,824)
Billings in excess of costs and estimated earnings
on uncompleted contracts (8,857) 16,567
Income taxes payable - (76)
Net cash (used) for operating activities (146,475) (1,221,723)
Investing activities:
Fixed asset acquisitions (5,677) -
Financing activities:
Deferred offering costs charged to additional paid in capital - 103,554
Proceeds from initial public offering - 4,008,072
Costs associated with initial public offering - (903,820)
Loans from related parties 129,532 8,475
Principal payments on mortgage payable - (102,385)
Repayment of notes payable - (1,075,296)
Net cash provided by financing activities 129,532 2,038,600
Net increase (decrease) in cash (22,620) 816,877
Cash, beginning 399,652 206,246
Cash, ending $377,032 $1,023,123
Supplemental disclosure of cash flow information:
Cash paid during the six months for:
Interest $7,599 $54,976
Income taxes - -
Supplemental disclosure of non-cash investing and financing activities:
Issuance of common stock in connection with services provided
to the Company $150,000 $ 49,500
</TABLE>
See notes to consolidated financial statements
(unaudited).
<PAGE>
NOTE 1 - GENERAL
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with instructions to Form 10-QSB. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management the consolidated interim financial statements include all adjustments
necessary in order to make the consolidated financial statements not misleading.
The results of operations for the three and six months ended are not necessarily
indicative of the results to be expected for the full year. For further
information, refer to the Company's audited consolidated financial statements
and footnotes thereto at June 30, 1996, included in the Company's Annual Report
Form 10K-SB, filed with the Securities and Exchange Commission.
US Bridge Corp. ("the Company") was incorporated in the State of Delaware
on September 11, 1988 under the name of Colonial Capital Corp. The Company
subsequently changed its name to Cofis International Corp. ("Cofis") during May
1991. Effective April 1994, in connection with its recapitalization, (See Note
6a) Cofis changed its name to US Bridge Corp.
US Bridge of N.Y. Inc. ("US Bridge NY") is a New York Corporation and as of
December 31, 1996 is a majority owned subsidiary of the Company.
One Carnegie Court Associates, Ltd. ("One Carnegie"), was incorporated in
the State of Maryland and is a wholly owned subsidiary of the Company. One
Carnegie was incorporated on December 14, 1990 for the purposes of acquiring on
January 14, 1991, land, building, machinery and equipment. One Carnegie rented
said facilities to an affiliate under terms pursuant to a signed lease
agreement. (See Note 7).
On September 21, 1994, the Company formed a wholly owned subsidiary named
US Bridge of Maryland Inc. ("US Bridge MD"). US Bridge MD was incorporated in
the State of Delaware for the purpose of providing material and labor to perform
fabrication work for US Bridge of NY.
Effective April 1994, the Company has adopted a new fiscal year that ends
on June 30 which is the same year end date as its subsidiaries. In connection
therewith, the Company has and will report its operations at December 31, 1996
and 1995 for the six months then ended, respectively, in order to correspond
with its operating subsidiaries.
The consolidated financial statements at December 31, 1996 and 1995 include
the accounts of the Company and its majority owned subsidiary US Bridge NY, and
its wholly owned subsidiaries One Carnegie and US Bridge MD, after elimination
of all significant intercompany transactions and accounts.
<PAGE>
NOTE 2 - PAYROLL TAXES
During September 1994, US Bridge NY entered into an installment agreement
with the Internal Revenue Service in order to liquidate delinquent payroll taxes
of approximately $231,535 and remove a tax lien filed by such authority. The
agreement requires US Bridge NY to pay $25,000 per month until such amount is
fully paid. As per the terms of the agreement, US Bridge NY must also pay timely
all current payroll taxes. As of December 31, 1996, US Bridge NY has not made
all the required $25,000 monthly payments and has not paid timely all current
payroll taxes. US Bridge NY is liable for approximately $441,583 of the total
consolidated payroll taxes payable amounting to $537,564 at December 31, 1996.
NOTE 3 - NOTE PAYABLE
During August 1994, the Company secured a $250,000 credit line with a bank
at an interest rate of one and one half percent (11/2%) above the prime rate.
Interest is payable on the first day of each month which commenced October 1,
1994. Said credit line is payable on demand. At December 31, 1996 the balance
was $145,837.
NOTE 4 - MORTGAGE PAYABLE
On October 12, 1995, in connection with the original acquisition of the
property and equipment, One Carnegie signed with the lender a letter agreement
revising the modification agreement discussed below. Pursuant to such letter
agreement, One Carnegie was in default as of December 31, 1996. Accordingly, the
mortgage has been classified as current at December 31 and June 30, 1996, since
One Carnegie has not paid the required monthly installments timely as stipulated
in the letter agreement thereby allowing the lender to call the loan at anytime.
On December 13, 1994, One Carnegie signed a modification to the first
forbearance agreement with the lender. Pursuant to such modification agreement,
the lender agreed not to accelerate and demand full payment of the note and
allowed One Carnegie to reduce the monthly payments to $40,000 pursuant to a new
two (2) year amortization schedule provided by the lender. Such modification
agreement required One Carnegie to make timely payments after December 31, 1994,
which One Carnegie did not make timely.
The above terms had been previously modified as follows. On February 1,
1991, One Carnegie originally entered into a $3,000,000 installment loan with
interest at 11% per annum through November 1994, with interest increasing to 13%
per annum in December 1994; monthly payments including interest of $50,000
through November 1993, increasing to $60,000 in December 1993 and increasing to
$177,430 on December 14, 1994 until January 15, 1996, the due date of the loan.
The mortgage is collateralized by all property and equipment of One Carnegie and
is personally guaranteed by the majority stockholder of the Company and an
entity owned by such stockholder.
<PAGE>
NOTE 4 - MORTGAGE PAYABLE (Cont'd)
On October 21, 1993, One Carnegie signed the first Forbearance Agreement
staying foreclosure and restructuring the terms under the above original
mortgage agreement. The respective terms under said agreement required One
Carnegie to make monthly payments of $50,000 to October 14, 1994, a $60,000
payment on November 14, 1994, and monthly payments of $177,430 thereafter until
maturity on January 15, 1996. Interest is payable at 11% per annum. Upon the
earlier to occur of October 14, 1994 or a public or private issuance by One
Carnegie of either equity or debt with a term of three (3) years or more
(including sale/leaseback or other off balance sheet financing), or any
combination thereof, One Carnegie was required to pay to the mortgagor the
amount sufficient to pay in full all interest then accrued and unpaid on the
Indebtedness and to reduce the outstanding principal amount of the indebtedness
to $2,331,965 which is the amount that would have been outstanding on such date
had One Carnegie timely made all of the payments based on the original mortgage
agreement. Pursuant to such forbearance agreement, the Mortgagor may terminate
immediately, irrevocably and without notice such forbearance agreement if One
Carnegie defaults on such terms.
One Carnegie did not make the required payment on October 14, 1994 to
reduce the outstanding principal amount of the indebtedness to $2,331,965
pursuant to such forbearance agreement. The lender did not but could have
accelerated and demanded the total balance due under the note and could
terminate the forbearance agreement immediately, irrevocably and without notice.
NOTE 5 - MINORITY INTEREST
In connection with the initial public offering of US Bridge NY, the
Company's ownership percentage in US Bridge NY was reduced to 49.95% before the
exercise of the special warrant as discussed in Note 6g. Accordingly, at
December 31, 1996 the Company's minority interest amounting to $2,688,793
represents the interest of minority shareholders resulting from the effect of US
Bridge NY's private offering and the initial public offering and the cumulative
effect of US Bridge NY's operations since the private offering and initial
public offering through December 31, 1996.
NOTE 6 - STOCKHOLDERS' EQUITY
During December 1996, the Company granted a total of 686,617 stock options
to various individual comprised of the Company's President, Secretary,
Treasurer, and key employees pursuant to the 1995 Senior Management Incentive
Plan and employee stock option plan (see Note 9a for additional information). In
February 1997 the Company filed an S-8 registration statement to register the
resale of such shares.
On June 16, 1995 pursuant to Form S-8 Registration Statement filed with
Securities and Exchange Commission the Company registered and issued 500,000
shares to a broker dealer as consideration for a two year consulting agreement.
Pursuant to the consulting agreement, the consultant will serve as a financial
consultant and advisor to the Company on a non-exclusive basis for a period of
twenty-four (24) months commencing on June 1, 1995. Of the total 500,000 shares
issued to the consultant, 250,000 of such shares were to be held in escrow and
released to the consultant upon
<PAGE>
the approval of the Company's common stock on NASDAQ. The Company had also
agreed that upon NASDAQ approval, an additional 100,000 shares of restricted
stock were to be issued to the consultant. Pursuant to a consent of the Board of
Directors, the company amended such consulting agreement whereby such shares in
escrow were released to such consultant during February 1996 even though the
Company was not listed on NASDAQ until July 25, 1996. Lastly, the Board of
Directors further amended the consulting agreement to increase the additional
number of shares from 100,000 to 250,000. Accordingly during August 1996, the
Company issued 250,000 restricted shares to such consultant.
NOTE 7 - COMMITMENT AND CONTINGENCIES
a) Significant vendors
For the three and six months ended December 31, 1996 and 1995, US Bridge NY
purchased from Waldorf Steel Fabrications, Inc. ("Waldorf") approximately $-0-
and $-0- and $-0- and $180,333, respectively, of the materials and labor
necessary to perform steel erection services. Effective August 1, 1995, Waldorf
ceased operations. Lastly, for the three and six months ended December 31, 1996
and 1995, US Bridge N.Y. paid $172,141 and $337,821 and $229,767 and $374,700
respectively to US Bridge MD for certain materials and labor necessary to
perform steel erection services. US Bridge MD is a wholly owned subsidiary of
the Company. Amounts payable related to all of such transactions and included in
accounts payable total $189,071 at December 31, 1996. Such amounts are
non-interest bearing obligations. Said vendors are under the common control of
the Company's majority stockholder.
b) Bonding requirements
US Bridge NY is required to provide bid and/or performance bonds in
connection with governmental construction projects. To date, US Bridge NY has
been able to sufficiently obtain bonding up to $10,000,000 per job for its
private projects. US Bridge NY is continuously pursuing obtaining bonding for
its governmental construction projects. In addition, new or proposed legislation
in various jurisdictions may require the posting of substantial additional bonds
or require other financial assurances for particular projects.
c) Payroll Taxes
During September 1994, US Bridge NY entered into an installment agreement
with the Internal Revenue Service in order to liquidate delinquent payroll taxes
of approximately $231,535 and remove a tax lien filed by such authority. The
agreement requires US Bridge NY to pay $25,000 per month until such amount is
fully paid. As per the terms of the agreement, US Bridge NY must also pay timely
all current payroll taxes. As of December 31, 1996, US Bridge NY has not made
all the required $25,000 monthly payments and has not paid timely all current
payroll taxes. US Bridge NY is liable for approximately $441,583 of the total
consolidated payroll taxes payable amounting to $537,564 at December 31, 1996.
<PAGE>
d) Due to Officer
On May 13, 1996, an unrelated party loaned the Company's President $300,000
pursuant to a memorandum of understanding. The loan bears interest at 1% above
prime, and its due 90 days from receipt of funds. Simultaneously therewith, the
Company's President loaned the Company the $300,000. As collateral for the loan,
550,000 shares of the Company's common stock owned by the President were put in
an escrow account. Upon the Company being listed on NASDAQ, the Company will
liquidate such loan by releasing 400,000 shares from the escrow account to such
unrelated party pursuant to Regulation "S" under the Securities Act of 1933, as
amended. Accordingly, during September 1996, the Company released 400,000 shares
to such unrelated party for satisfaction of the loan.
Additionally, the Company's President issued to such unrelated party an
option to purchase 600,000 share at $1.50 per share from the day the funds are
received until 6 months after the Company attains NASDAQ listing. The option may
be exercised at any time within the exercise period subject to a minimum bid
price of $3 per share. Lastly, the Company's President may borrow an additional
$100,000 under the same terms as discussed above for a period of 30 days.
As of December 31, 1996, of the total due to related parties amounting to
$488,311, $267,500 represents the remaining amount owed for the original
$300,000 loan and the remaining balance amounting to $220,811 represents
advances made by the President to the Company's subsidiaries which bear no
interest and are due on demand.
NOTE 8 - SUBSEQUENT EVENTS
a) Form S-8 registration statements
(i) US Bridge NY
During February 1997, pursuant to a Form S-8 Registration Statement filed
with the Securities and Exchange Commission, US Bridge NY registered 125,000
common shares underlying options to purchase one share each of common stock of
US Bridge NY to US Bridge NY's President pursuant to the 1994 Senior Management
Incentive Plan. The options are exercisable at $1.10 per share (110% of the bid
price on November 27, 1996) and expire on November 27, 2001.
(ii) US Bridge Corp.
During February 1997, pursuant to a Form S-8 Registration Statement filed
with the Securities and Exchange Commission, the Company registered a total of
686,617 common shares underlying options to purchase one share each of common
stock of the company pursuant to the 1995 Senior Management Incentive Plan and
Employee Stock Option Plan. Such options were issued to various individuals
comprised of the Company's President, Secretary, Treasurer, and various key
employees of the Company. The options are exercisable at various prices ranging
from $1.10 each to $1.925 each.
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
On April 25, 1994, after giving effect to a 1-for-4 reverse stock split,
the Company issued 2,820,000 and 720,000 shares, respectively, of its common
stock to the stockholders of US Bridge NY and One Carnegie in exchange for all
of their issued and outstanding shares. The acquisition by the Company has been
treated as a recapitalization for accounting purposes. Accordingly, after such
transaction and before US Bridge NY's private offering and initial public
offering, US Bridge NY was a wholly owned subsidiary of the Company. As of
December 31, 1996 US Bridge NY is a 50.1% owned subsidiary and One Carnegie is a
wholly owned subsidiary of the Company.
The following Management's discussion and analysis for the three and six
months ended December 31, 1996 and 1995 are that of the Company's subsidiaries
since the Company itself did not have any material operations of its own.
RESULTS OF OPERATIONS
Three months ended December 31, 1996 as compared to three months ended
December 31, 1995.
US Bridge NY recognizes revenue under the percentage of completion method.
Cost of contract revenues include all direct material and labor costs and those
indirect costs related to contract performance. The asset, costs and estimated
earnings in excess of billings on uncompleted contracts, represents costs and
estimated earnings in excess of amounts billed through December 31, 1996.
Billings in excess of costs and estimated earnings on uncompleted contracts,
represents billings which exceed costs and estimated earnings on individual
uncompleted contracts through December 31, 1996.
Contract revenues have increased by $1,701,296 or 183% to $2,631,390 from
$930,094 for the three months ended December 31, 1996 as compared to the three
months ended December 31, 1995. This material increase is due to new contracts
commencing toward the first quarter of the Company's fiscal year.
General and administrative expenses include salaries, office overhead and
costs associated with estimating and bidding activities. General and
administrative expenses have increased by $105,934 or 15% to $791,373 for the
three months December 31, 1996 from $685,439 for the three months ended December
31, 1995. The total increase amounting to $105,934 was attributable to primarily
the increase in administrative personnel involved in the bidding process, and
additional administrative duties involved with the increase in revenue.
Six months ended December 31, 1996 as compared to six months ended December
31 1995
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
Contract revenues have increased by $3,250,454 or 127% to $5,807,441 from
$2,556,987 for the six months ended December 31, 1996 as compared to the six
months ended December 31, 1995. This material increase is due to new contracts
commencing toward the first quarter of the Company's fiscal year.
General and administrative expenses include salaries, office overhead and
costs associated with estimating and bidding activities. General and
administrative expenses have increased by $87,498 or 6% to $1,459,784 for the
six months December 31, 1996 from $1,372,286 for the six months ended December
31, 1995. The total increase amounting to $87,498 was attributable to primarily
the increase in administrative personnel involved in the bidding process, and
additional administrative duties involved with the increase in revenue.
Liquidity and Capital Resources
As of December 31, 1996, US Bridge NY has a backlog of approximately
$14,313,000. Backlog represents the amount of revenue US Bridge expects to
realized from work to be performed on uncompleted contracts in progress and from
contractual agreements which work has not yet begun.
At December 31, 1996, the Company has a consolidated working capital of
$1,966,125
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
As of December 31, 1996, the Company's accounts receivable amounted to
$6,880,663, of which approximately $940,000 or 14% has been collected through
February 17, 1997.
During December 1996, the US Bridge NY filed three separate mechanic's
liens aggregating $3, 044,491 against two if its customers for non payment. Such
amount is included in the contracts and retainage receivable amount. As of June
30, 1996 the US Bridge NY recorded an allowance against the accounts of these
customers. No additional allowances have been recorded as of December 31, 1996.
Net cash used for operating activities amounted to $168,475 for the six
months ended December 31, 1996, as compared to $1,221,723 use of cash for the
six months ended December 31, 1995. With regards to financing activities, the
Company provided $151,532 of cash for the six months ended December 31, 1996.
Such cash was provided primarily by loans from an officer of the Company.
During September 1994, US Bridge NY entered into an installment agreement
with the Internal Revenue Service in order to liquidate delinquent payroll taxes
of approximately $231,535 and remove a tax lien filed by such authority. The
agreement requires US Bridge NY to pay $25,000 per month until such amount is
fully paid. As per the terms of the agreement, US Bridge NY must also pay timely
all current payroll taxes. As of December 31, 1996, US Bridge NY has not made
all the required $25,000 monthly payments and has not paid timely all current
payroll taxes. US Bridge NY is liable for approximately $441,583 of the total
consolidated payroll taxes payable amounting to $537,564 at December 31, 1996.
On October 12, 1995, in connection with the original acquisition of the
property and equipment, One Carnegie signed with the lender a letter agreement
revising the modification agreement discussed below. Pursuant to such letter
agreement, One Carnegie was in default as of December 31, 1996. Accordingly, the
mortgage has been classified as current at December 31, 1996, since One Carnegie
has not paid the required monthly installments timely as stipulated in the
letter agreement thereby allowing the lender to call the loan at anytime.
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
PART II - OTHER INFORMATION
ITEM 1 - Legal Proceedings:
In January 1997, an action was commenced by The Ohio Bridge Corporation
("Ohio") against U.S. Bridge of N.Y., Inc. ("NY"), alleging that that NY has
infringed its trademark "U.S. Bridge". In February 1997 NY filed an answer to
the complaint. The action is presently in the discovery stage. Ohio is
requesting injunctive relief, profits obtained by use of the name and
compensatory damages. NY's defense is based upon its belief that the two
companies do not compete against each other in the same industry and that Ohio
does not use the trademark in order to sell, market or advertise its products.
ITEM 2 - Changes in Securities: None
ITEM 3 - Defaults Upon Senior Securities:None
ITEM 4 - Submission of Matters to a Vote of Security Holders:
On January 9, 1997, the Company held an annual meeting, at which time its
stockholders (i) elected three directors to the Corporation's Board of Directors
to hold office for a period of one year or until their successors are duly
elected and qualified (ii) approved an amendment to the Corporation's Senior
Management Incentive Plan to increase the number of shares of Common Stock
authorized for issuance thereunder from 1,000,000 to 2,000,000; and (iii)
approved an amendment to the Corporation's Employee Stock Option Plan to
increase the number of shares of Common Stock authorized for issuance thereunder
from 1,000,000 to 2,000,000. At the meeting the stockholders approved the
proposals by votes as follows:
Votes Cast Withhold
Nominees For Authority to Vote
Joseph M. Polito 5,760,628 2,100
Ronald J. Polito 5,760,628 2,100
Steven J. Polito 5,760,628 2,100
<PAGE>
U.S. BRIDGE CORP. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
The proposal to authorize the Corporation to ratify an amendment to the
Corporation's Senior Management Incentive Plan to increase the number of shares
of Common Stock authorized for issuance thereunder from 1,000,000 to 2,000,000
received at least a plurality of the votes cast.
Votes Cast Votes Cast
For Against Abstain
4,318,281 27,800 0
The Proposal to ratify an amendment to the Corporation's Employee Stock
Option Plan to increase the number of shares of Common Stock authorized for
issuance thereunder from 1,000,000 to 2,000,000 received at least a plurality of
the votes cast.
Votes Cast Votes Cast
For Against Abstain
4,320,281 25,800 0
ITEM 5 - Other Information:None
ITEM 6 - Exhibits and Reports on Form 8-K: None
<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.
U.S. Bridge Corp.
(Registrant)
February 21, 1997 /s/ Joseph Polito
Date Joseph Polito
President
/s/ Ronald Polito
Ronald Polito
Treasurer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Schedule contains summary financial information extracted from Balance
Sheet, Statement of Operations, Statements of Cash Flows and Notes thereto
incorporated in this Form 10-QSB and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> jun-30-1997
<PERIOD-END> dec-31-1996
<CASH> 377,032
<SECURITIES> 0
<RECEIVABLES> 6,880,663
<ALLOWANCES> 0
<INVENTORY> 1,072,000
<CURRENT-ASSETS> 0
<PP&E> 2,995,440
<DEPRECIATION> 0
<TOTAL-ASSETS> 11,553,896
<CURRENT-LIABILITIES> 6,381,747
<BONDS> 0
0
0
<COMMON> 6,016
<OTHER-SE> 2,477,340
<TOTAL-LIABILITY-AND-EQUITY> 11,553,896
<SALES> 2,631,390
<TOTAL-REVENUES> 2,631,390
<CGS> 1,844,404
<TOTAL-COSTS> 2,635,777
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 78,752
<INCOME-PRETAX> (159,884)
<INCOME-TAX> 0
<INCOME-CONTINUING> (159,884)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (159,884)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> 0
</TABLE>
