SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1998
Commission File No. 017833
GREENLAND
CORPORATION
Nevada 87-0439051
(State or other jurisdiction of (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
incorporation or organization)
7084 Miramar Road
Fourth Floor
San Diego, CA 92121
(Address and zip code of principal executive offices
(619) 566-9604
(Registrant's telephone number, including area code)
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.
[X] YES [ ] NO
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
Class A Common Stock 9,498,634 Shares Outstanding
$0.001 par value as of August 11, 1998
<PAGE>
GREENLAND CORPORATION
(A DEVELOPMENT STAGE COMPANY)
REPORT ON FORM 10-QSB
QUARTER ENDED JUNE 30, 1998
TABLE OF CONTENTS
Part I. Financial Information
Item 1. Financial Statements
Consolidated balance sheets as of June 30, 1998
Consolidated statements of operations
Three months ended June 30, 1998 and 1997
Six months ended June 30, 1998 and 1997
7/17/86 (date of inception) to June 30, 1998
Consolidated statement of changes in stockholders' equity as of
June 30, 1998
Consolidated statements of cash flows
Three months ended June 30, 1998 and 1997
` Six months ended June 30, 1998 and 1997
7/17/86 (date of inception) to June 30, 1998
Notes to consolidated financial statements
Item 2. Management's discussion and analysis of financial
condition and results of operations
Part II. Other Information
Signatures
<PAGE>
GREENLAND CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
June 30,
1998
-----------------
ASSETS
Current Assets
<S> <C>
Cash in banks $ 26,640
Accounts receivable - officers (Note 2) 147,585
-----------------
TOTAL CURRENT ASSETS 174,225
Equipment, net of depreciation of $15,170 (Note 1) 27,884
Other Assets
Notes Receivable (Note 3) 1,900,000
Investments (Note 3) 1,639,143
Software and licenses (Note 4) 2,625,000
Capitalized software costs (Note 1) 186,723
-----------------
$ 6,552,975
=================
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable $ 131,366
Accrued liabilities 11,000
Payroll taxes payable 2,365
-----------------
TOTAL CURRENT LIABILITIES 144,731
Convertible secured debentures (Note 5) 5,000
Contingent liabilities 0
-----------------
TOTAL LIABILITIES 149,731
STOCKHOLDERS' EQUITY
Common Stock $.001 par value:
Authorized -100,000,000 shares
Issued and outstanding 9,374,134 shares 93,741
Additional paid-in capital 11,876,409
Deficit accumulated during development stage (5,566,906)
-----------------
TOTAL STOCKHOLDERS' EQUITY 6,403,244
-----------------
$ 6,552,975
=================
</TABLE>
<PAGE>
GREENLAND CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
7/17/86
Three Months Ended Six Months Ended (Date of
June 30, June 30, inception) to
1998 1997 1998 1997 6/30/98
------------- -------------- ------------- ------------- ------------------
REVENUES
<S> <C> <C> <C> <C> <C>
AMR Sales $ 0 $ 0 $ 10,000 $ 0 $ 65,000
Other income 4,871 1,078 5,491 18,657 65,812
------------- -------------- ------------- ------------- ------------------
4,871 1,078 15,491 18,657 130,812
EXPENSES
General and administrative 988,210 482,171 1,416,909 1,024,555 3,978,677
Depreciation 1,518 1,518 3,036 3,036 15,170
Interest 79 0 8,529 0 50,770
Property taxes and other taxes 30,215 4,826 30,215 16,324 83,924
Research and development 67,259 0 123,669 0 123,669
Bad debts 0 0 0 0 59,668
------------- -------------- ------------- ------------- ------------------
1,087,281 488,515 1,582,358 1,043,915 4,311,878
------------- -------------- ------------- ------------- ------------------
LOSS FROM OPERATIONS (1,082,410) (487,437) (1,566,867) (1,025,258) (4,181,066)
OTHER INCOME (LOSS)
Gain on disposition of subsidiary 0 0 0 0 531,388
Gain (Loss) on sale of properties (437,881) 290,000 (437,881) 290,000 (552,881)
------------- -------------- ------------- ------------- ------------------
NET LOSS FROM
CONTINUING OPERATIONS (1,520,291) (197,437) (2,004,748) (735,258) (4,202,559)
Loss from discontinued operations (Note 1) 0 (32,877) 0 (33,512) (1,364,347)
------------- -------------- ------------- ------------- ------------------
NET LOSS BEFORE
INCOME TAXES (1,520,291) (230,314) (2,004,748) (768,770) (5,566,906)
PROVISION FOR INCOME TAXES 0 0 0 0 0
------------- -------------- ------------- ------------- ------------------
NET LOSS $ (1,520,291) $ (230,314) $ (2,004,748) $ (768,770) $ (5,566,906)
============= ============== ============= ============= ==================
NET LOSS PER WEIGHTED
AVERAGE SHARE $ (.33) $ (.12) $ (.43) $ (.41)
============== ============== ============== ==============
Weighted average number of common shares
used to compute net income (loss) per
weighted average share 4,628,757 1,855,621 4,628,757 1,885,621
============= ============== ============= =============
</TABLE>
<PAGE>
GREENLAND CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
Common Stock Additional
Par Value $0.001 Paid - in Retained
Shares Amount Capital Deficit
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Balances at 12/31/97 2,709,778 $ 27,097 $ 7,131,369 $ (3,562,158)
Issuance of common stock (restricted)
at $.75 per share for subsidiary 3,500,000 35,000 2,590,000
at $1.00 per share to cancel debt 16,400 164 16,236
at $.50 per share for cash 100,000 1,000 49,000
at $.40 per share for cash 125,000 1,250 48,750
at $1.00 per share for cash 252,400 2,524 249,876
at $1.00 per share for services 72,500 725 71,775
at $.85 per share for services 3,000 30 2,520
at $.75 per share for services 350,000 3,500 259,000
at $.50 per share for services 35,000 350 15,400
at $.20 per share for services 20,000 200 3,800
Issuance of common stock (S-8)
at $.70 per share for services 167,500 1,675 115,575
at $.50 per share for services 246,500 2,465 120,785
at $1.00 per share for services 20,000 200 19,800
at $1.50 per share for services 96,056 961 143,123
at $.60 per share for services 760,000 7,600 448,400
at $1.00 per share to cancel debt 400,000 4,000 396,000
at $.40 per share to cancel debt 500,000 5,000 195,000
Net loss for period (2,004,748)
-------------- -------------- -------------- -------------
Balances at 6/30/98 9,374,134 $ 93,741 $ 11,876,409 $ (5,566,906)
============== ============== ============== =============
</TABLE>
<PAGE>
GREENLAND CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
7/17/86
Six months ended (Date of
June 30, inception) to
1998 1997 6/30/98
------------- ------------- -------------
OPERATING ACTIVITIES
<S> <C> <C> <C>
Net loss $ (2,004,748) $ (768,770) $ (5,566,906)
Adjustments to reconcile net loss to cash
provided (required) by operating activities:
Depreciation and amortization 3,036 96,438 579,386
Unrealized decrease in investments 0 0 83,826
Book value of disposed assets/liabilities 388,000 0 588,374
Stock issued for services 1,217,884 0 2,041,306
Changes in operating assets and liabilities:
Accounts receivable (1,000) (17,650) (87,918)
Escrow accounts 0 (3,145) 0
Other assets 0 542
Accounts payable 7,864 34,569 131,366
Accrued expenses (59,743) (27,404) 29,765
Deposits 0 4,917 0
Payable to stockholders 0 (54,960) 0
Current portion of long-term debt 0 (950) 0
Property taxes payable 0 0 (112,522)
------------- ------------- -------------
NET CASH REQUIRED BY OPERATING ACTIVITIES (448,707) (736,955) (2,312,781)
INVESTING ACTIVITIES
Acquisition of investments 0 (302,789) 0
Capitalization of software costs 0 0 (186,723)
Purchase of stock 0 0 (55,000)
Purchase of equipment (581) 0 (18,139)
Sale of property 112,000 0 112,000
Organization cost 0 0 (50)
------------- ------------- -------------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 111,419 (302,789) (147,912)
FINANCING ACTIVITIES
Cash from subsidiary 0 0 23,415
Proceeds from sale of stock 352,400 743,726 1,989,736
Collections of stock subscription 0 0 40,000
Amounts borrowed from (repaid to) stockholders 0 (140,790) 0
Repayment of loans 0 (12,936) (243,818)
Proceeds from new loans 5,000 600,000 678,000
------------- ------------- -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 357,400 1,190,000 2,487,333
------------- ------------- -------------
INCREASE IN CASH AND CASH EQUIVALENTS 20,112 150,256 26,640
Cash and cash equivalents at beginning of period 6,528 6,909 0
------------- ------------- -------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 26,640 $ 157,165 $ 26,640
============= ============= =============
SUPPLEMENTAL INFORMATION
Cash paid for interest $ 79 $ 0 $ 951,400
Subsidiary acquired by issuance of stock 2,625,000 0 2,625,000
Assets acquired by assumption of debt and issuance of stock 0 0 10,933,790
Cancellation of stock previously issued for assets determined
to be worthless (Note 4) 0 0 459,432
Investment received in exchange for non-cash assets 0 2,515,000 6,365,000
Net book value of assets exchanged for investment 0 0 (1,412,077)
Land option exchanged for investment 0 (2,515,000) (2,515,000)
Stock issued to cancel debt 616,400 0 865,439
------------- ------------- -------------
$ 3,241,479 $ 0 $ 18,272,984
============= ============= =============
</TABLE>
<PAGE>
GREENLAND CORPORATION
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
Part I - Financial Information
BASIS OF PRESENTATION
General
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB. Therefore, they do not include
all information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows, and stockholders' equity in
conformity with generally accepted accounting principles. Except as disclosed
herein, there has been no material change in the information disclosed in the
notes to the financial statements included in the Company's annual report on
Form 10-KSB for the year ended December 31, 1997. In the opinion of Management,
all adjustments considered necessary for a fair presentation of the results of
operations and financial position have been included and all such adjustments
are of a normal recurring nature. Operating results for the quarter ended June
30, 1998 are not necessarily indicative of the results that can be expected for
the year ended December 31, 1998.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
Principal Operations
The principal business of the Company is the marketing of advanced
technologies, which include Check Central, an automated check cashing
machine; and AirLink(TM) a communications technology that enables
utilities to automate meter reading.
Accounting Methods
The Company recognizes income and expenses based on the accrual method
of accounting.
Consolidation
The financial statements include the accounts of Greenland Corporation
and its wholly-owned subsidiary, Check Central, Inc. All significant
intercompany transactions have been eliminated in consolidation.
Discontinued Operations
In December, 1997 the Company disposed of its wholly-owned subsidiary
Gam Properties, Inc. (which was in the real estate rental business).
The net loss from operations of the subsidiary during 1997 was
$(190,660).
Development Stage
The Company was in the development stage prior to 1994, when it
acquired its subsidiary Gam Properties, Inc. Upon the disposition of
that subsidiary at December 31, 1997, the Company re-entered the
development stage.
Equipment
Equipment is recorded at cost. Depreciation is provided for using the
straight-line method over a seven year life. The cost of assets sold or
retired and the related amounts of accumulated depreciation are removed
from the accounts in the year of disposal. Any resulting gain or loss
is reflected in current operations. Expenditures for maintenance and
repairs are charged to operations as incurred; additions and
improvements are capitalized.
Dividend Policy
The Company has not yet adopted any policy regarding payment of
dividends.
Capitalized Software
The Company has capitalized expenses incurred to install live test
sites for its AirLink automated meter reading systems. The plan is to
amortize the costs against revenues from sales of the systems over a
period of five years.
<PAGE>
GREENLAND CORPORATION
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)
JUNE 30, 1998
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES (continued)
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
Fair Market Value of Financial Instruments
The company considers all highly liquid investments with a maturity
date of three months or less to be cash equivalents and are deemed to
approximate fair value. In management's opinion, the carrying value of
long-term debt also approximates fair value.
Income Taxes
The Company records the income tax effect of transactions in the same
year that the transactions enter into the determination of income,
regardless of when the transactions are recognized for tax purposes.
Tax credits are recording in the year realized. Since the Company has
not yet realized income as of the date of this report, no provision for
income taxes has been made.
The Company utilizes the liability method of accounting for income
taxes as set forth in Statement of Financial Accounting Standards No.
109, "Accounting for Income Taxes" (SFAS 109). Under the liability
method, deferred taxes are determined based on the difference between
the financial statement and tax bases of assets and liabilities using
enacted tax rates in effect in the years in which the differences are
expected to reverse. An allowance against deferred tax assets is
recorded when it is more likely than not that such tax benefits will
not be realized.
NOTE 2: ACCOUNTS RECEIVABLE - OFFICERS
During 1997, the Company advanced $147,585 to officers and employees.
The funds will be repaid in 1998 or withheld from wages.
NOTE 3: INVESTMENTS
Investments consist of the following items:
1- 25,000 shares of common stock of PSA, Inc. (OTCBB-PSAZ). The
cost was $55,000, and the current market value at June
30, 1998 was approximately $55,000.
2- A 49% interest in a limited liability company which is reported
at $134,143 under the equity method.
3-290,000 convertible preferred shares of Golden Age Homes, Inc.
(OTCBB-GAHI). The net book value of the Company's subsidiary which
was exchanged for these shares was $1,412,077. The negotiated
price at December 31, 1997 was $1,630,000, which is the value
reflected on these financial statements. The shares are
convertible in 1999 to the number of common shares (at the
then-current market price) equivalent to $1,450,000.
In the first quarter of fiscal 1998, the Company entered into a
transaction with Quantix, a Nevada Corporation, to exchange its holdings of
1,100,000 shares of 5% Convertible Class B Preferred Stock of Natural Born
Carvers, Inc. for a combination of real estate, trust deeds, and promissory
note. The transaction is intended to convert non-liquid assets of the Company
into those that can be used, in the future, for the ongoing financing of the
Company. These are listed on the Company's balance sheet as Notes Receivable in
the amount of $1,900,000.
NOTE 4: SOFTWARE AND LICENSE
On May 12, 1998, the Company exchanged 3,500,000 shares of its restricted
common stock for 100% of the outstanding stock of Check Central, Inc. (a Nevada
corporation). Check Central, Inc. was a new entity with no history of operations
and assets consisting of software and licenses, which the Company plans to use
in developing and market a new product line.
<PAGE>
GREENLAND CORPORATION
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)
QUARTER ENDED JUNE 30, 1998
NOTE 5: 12% CONVERTIBLE SECURED DEBENTURES
During the first quarter of fiscal 1998, the Company issued an offering
consisting of $250,000 of 12% Convertible Debentures due April 1, 2000. The
Company promises to pay the registered holder(s) of debentures the principal sum
of his investment on April 1, 2000 and to pay interest on the principal sum
outstanding from time to time in arrears on the maturity date of the debentures
at the rate of twelve percent (12%) per annum, accruing from the date of initial
issuance. The debentures are convertible into shares of the Company's common
stock at the greater of $0.10 per share or ninety percent (90%) of the bid price
of the Company's common stock as quoted on the OTC Electronic Bulletin Board at
the date of conversion. For each $10,000 of debentures, purchasers will receive
50,000 one-year warrants, expiring March 1, 1999, to purchase shares of the
Company's common stock at $0.25 per share. During the first quarter ended March
31, 1998, the Company sold a principal amount of Debentures of $5,000. There
have been no further sales of such debentures.
NOTE 6: REVERSE SPLIT OF COMMON STOCK
On June 12, 1998, shareholders approved a 1 for 10 reverse split of the
Company's common stock effective July 2, 1998. The effect of the authorization
was that each ten (10) issued and outstanding shares of Common Stock were
automatically converted into one (1) new share of Common Stock, par value
$0.001. The number of authorized shares and the par value designation of the
Common Stock were unaffected by the reverse split. The Company's financial
statements in this filing have been adjusted to account for the reverse split,
which was made effective July 2, 1998, as if it had occurred at the beginning of
the earliest period presented.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Introduction
The following discussion pertains to the Company's results of
operations and financial condition as of June 30, 1998 and 1997, respectively.
The operations of the Company's meter reading operations and
newly-acquired Check Central, Inc. subsidiary are consolidated in the Company's
financial statements.
The Company's AMR operations have been, devoted to research and
development and development of prototype installations of its AirLink(TM)
automated meter reading system. Operations have been devoted primarily to
engineering and administration.
The Company has pursued limited marketing and sales of its product
line, and is involved in preparing three pilot installations of AirLink in
Oregon, Utah, and Connecticut. These pilot installations are anticipated
sometime this year. The Company has patents pending with the U.S. Patent Office.
Sales of AirLink are highly dependent on the successful installation of
its contracted pilot systems. While management is optimistic that its sales
opportunities will bear positive results over time, it is likely that the sales
cycle will be lengthy.
The Company, in May 1998, acquired Check Central, Inc., developers of
proprietary technology to provide automated check cashing, money orders, and ATM
services from free-standing automated teller machines in retail locations.
The acquisition of Check Central was an all-stock transaction.
Greenland purchased all of the outstanding shares of Check Central for 3.5
million shares of Greenland restricted common stock (after the reverse split of
the Company's common stock) , representing, at the time, approximately 45% of
the total issued and outstanding shares.
The Company expects that some of its Check Central machines will be
Company-owned for which it will pay a space rental fee and a split of
transaction fees with retailers. At this time, the Company has released no
forecast related to the future financial performance of Check Central
operations. However, the Company estimates that the check-cashing market segment
is approximately $1.5 billion annually. The Company anticipates rollout of
initial units later in the current fiscal year.
<PAGE>
Results of Operations
Revenues
The Company had no income from sales of AirLink systems during the
quarter ended June 30, 1998. There was no income from AMR operations during the
corresponding quarter of fiscal 1997. For the six month period ended June 30,
1998, the Company had AMR revenues of $10,000 associated with its pilot
operations. There were no corresponding revenues in the year-earlier period. To
date, the Company has had AMR revenues of $65,000, all associated with
contracted pilot installations of AirLink.
Other income for the three months ended June 30, 1998 was $4,871. The
Company had $1,078 from other income in the prior year. For the six month period
ended June 30, 1998, the Company had other income of $5,491 compared to $18,657
in the prior year six month period.
Expenses
General and administrative expenses for the three month period ended
June 30, 1998 totaled $180,708 as compared to $238,327 for the prior year
period, a decrease of $129,619 or 54.4%. This decrease is attributable to
planned reduced expenses for day-to-day operations of the Company. For the six
month period ended June 30, 1998, general and administrative expenses were
$366,572 as compared to $481,411 for the prior year, a decrease of $114,839 or
23.9%. Since inception (July 17, 1986), the Company has paid $3,978,677 of
general and administrative expenses.
Research and development expenses for the three month period ended June
30, 1998 were $67,259, compared to $102,844 in the year-earlier three month
period. The reduction of $35,585 (34.6%) was due primarily to reduced parts
purchases as engineering was focused on adjustments to previous iterations of
the AirLink system. For the six month period ended June 30, 1998, research and
development expenses were $123,669 as compared to $190,739 for the period ended
June 30, 1997; a decrease of $67,070, or 35.2%. The Company has paid a total of
$123,669 in research and development expenses since its inception.
Consulting fees were $807,502 for the second quarter, as compared to
consulting fees of $141,000 for the prior-year This increase of $666,502 was due
primarily to fees paid for consulting services related to the acquisition of
Check Central. For the six month period ended June 30, 1998, consulting fees
were $1,050,337 compared to $352,405 in the year-earlier six-month period.
Historically, these fees have consisted primarily of those paid for services
related to the Company's financing activities.
Depreciation expense was $1,518 for the second quarter of fiscal 1998;
the identical amount as in the year-earlier three-month period. These expenses
are directly related to Company equipment. For the six month periods ended June
30, 1998, and 1997, depreciation was $3,036.
Interest expense was only $79 in the second quarter period of 1998;
there were no such expenses in the first quarter of fiscal 1997. Interest
expenses were $8,529 for the six month period ended June 30, 1998 compared to no
such expenses in the year-earlier six-month period. The increases in interest
expense are principally due to the Company's debt. Since inception, the Company
has paid $50,770 in interest.
Taxes for the three month period ended June 30, 1998 were $30,215
compared to $4,826 in the previous year's second quarter, an increase of
$25,389. For the six month period ended June 30, 1998, taxes were $30,215
compared to taxes of $16,324 for the prior year's six month period, an increase
of $13,891. Th increases are principally related to payroll taxes.
Automated Meter Reading Operations
The Company has continued to fund the development efforts of its
automated meter reading operations. During the second quarter, the Company
continued its efforts to deploy its pilot systems in Oregon, Utah, and
Connecticut. Installation of the pilot systems using new iterations of the
Company's radio technology is anticipated to begin later in this fiscal year.
Management has hired a number of outside consultants to assist its
engineering department in improving the core radio technology of its AirLink
automated meter reading system. The principal challenge of the system is to
improve the transmission distances of the radio units deployed in utility
meters, which must communicate with a central collection station for delivery of
data to utilities.
The Company has made several formal and informal presentations to
utilities in the U.S. and internationally, and hopes to accelerate its marketing
activities following successful deployment of pilot systems.
Check Central Operations
Check Central, Inc., acquired by Greenland in the second quarter, is
operated as a wholly-owned subsidiary. Check Central has developed technology to
enable automated banking and check cashing.
<PAGE>
The fundamental Check Central product is an automated teller machine
that is installed in a retail environment such as a convenience store, liquor
store, laundromat, supermarket, etc. It provides an automated platform to
provide several financial services. The basic services include:
payroll/government check cashing, money orders, and ATM functions. Additional
services may include, in the future: bill paying services (including utility
bills), wire transfers, on-line purchases, payday loans, electronic tax filing,
etc.
The core of the system is Check Central's proprietary server
technology. This is an on-line check approval system that makes all the check
cashing decisions and electronically dispenses the cash for each check
transaction. This service, along with the user-friendly design of the retail
machine, enables automated transaction services possible, including advanced
security features to minimize theft and fraud. This server technology, Check
Central Management Software ("CCMS"), has been extensively tested in the retail
market. This technology eliminates all responsibility at the store level by
providing proprietary software with sophisticated risk management algorithms,
digital communication to each branch location, connectivity to major databases,
and a back-office staff with experienced check cashing personnel. The system
makes all check cashing decisions in a real-time environment.
Initially, the Company will own and operate a limited number of
machines, paying for retail space and providing some profit-sharing revenues to
retailers. Alternatively, the Company will sell Check Central machines to
retailers and provide service and support in exchange for a percentage of fee
revenues.
At present, Check Central production units are in development.
Management anticipates release of these units in the third quarter of fiscal
1998.
Liquidity and Capital Resources
The Company's total assets were $6,552,975 at June 30, 1998, an
increase of $2,143,657, or 48.6%, over to the year ended December 31, 1997. This
increase in assets is based primarily on the acquisition of Check Central.
At June 30, 1998, the Company's total liabilities were $149,731, a
decrease of $663,279 (81.6%) over the year ended December 31, 1997. The decrease
is attributable primarily to the conversion of the Company's 10% Convertible
Secured Debentures.
Stockholders' equity was $6,403,244 at June 30, 1998, an increase of
$2,806,936 (78.1%) over the year ended December 31, 1997.
The Company had working capital of $24,494 at June 30, 1998. The
Company's working capital has improved by $58,468 since the period ended March
31, 1998 and by $84,390 since the year ended December 31, 1997. Management is
currently evaluating its options to raise additional capital through equity or
debt financing in order meet its ongoing requirements for working capital to
grow the business.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
None.
ITEM 2 - CHANGES IN SECURITIES
The Company effected a 1 for 10 reverse split of its Common Stock in
July, 1998. (See Note 6 to the Consolidated Financial Statements.)
ITEM 3 - DEFAULTS ON SENIOR SECURITIES
None.
ITEM 4 - SUBMISSION OF MATTER TO VOTE OF SECURITY HOLDERS
None.
ITEM 5 - OTHER INFORMATION
None.
<PAGE>
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - none.
(b) Reports on Form 8-K
Form 8-K filed June 2, 1998, related to the exchange of shares of
Greenland Common Stock for all of the outstanding shares of Check
Central, Inc.
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.
GREENLAND CORPORATION
August 14, 1998
--------------------------------------------
Lee R. Swanson
President, Chief Executive Officer, and Acting
Chief Financing Officer
August 14, 1998
--------------------------------------------
Thomas Beener
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from Greenland Corporation June 30, 1998 financial statements and
is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000852127
<NAME> Greenland Corporation
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 26,640
<SECURITIES> 1,639,143
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 174,225
<PP&E> 43,054
<DEPRECIATION> (15,170)
<TOTAL-ASSETS> 6,552,975
<CURRENT-LIABILITIES> 144,731
<BONDS> 5,000
0
0
<COMMON> 93,741
<OTHER-SE> 6,309,503
<TOTAL-LIABILITY-AND-EQUITY> 6,552,975
<SALES> 15,491
<TOTAL-REVENUES> 15,491
<CGS> 0
<TOTAL-COSTS> 1,582,358
<OTHER-EXPENSES> 437,881
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,529
<INCOME-PRETAX> (2,004,748)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,004,748)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,004,748)
<EPS-PRIMARY> (.43)
<EPS-DILUTED> (.43)
</TABLE>
