U .S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MAY 31, 1999
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 0-18412
PLAYORENA INC.
(Name of small business issuer in its charter)
New York 11-2602120
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 Vanderbilt Motor Parkway, Suite 311, Hauppauge, NY 11788
--------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Check whether the issuer (1) 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 X No .
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 9,198,679 shares of Common
Stock, par value $.001, outstanding as of June 30, 1999.
DOCUMENTS INCORPORATED BY REFERENCE: NONE
<PAGE>
FORM 10-QSB
FINANCIAL STATEMENTS AND SCHEDULES
PLAYORENA, INC.
For the Quarter ended May 31, 1999
The following financial statements and schedules of the registrant and
its consolidated subsidiaries are submitted herewith:
PART I- FINANCIAL INFORMATION
Page of
Form 10-QSB
Item 1. Financial Statements:
Balance Sheet/Liabilities and Shareholder's Equity -
May 31, 1999 and November 30, 1998 (unaudited) 3
Statement of Operations for the three months ended
May 31, 1999 and 1998 and six months ended
May 31, 1999 and 1998 (unaudited) 4
Statement of Cash Flows for the six months ended
May 31, 1999, and 1998 (unaudited) 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis or Plan of Operation 7
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REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
<PAGE>
PLAYORENA INC.
BALANCE SHEET
(UNAUDITED)
ASSETS
May 31, November 30,
1999 1998
----------- ------------
Cash 529 678
----------- ------------
TOTAL ASSETS $ 529 $ 678
=========== ============
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES:
Notes payable $ 85,000 $ 85,000
Due to shareholder 22,400 --
Liabilities of discontinued operations 66,226 66,226
Accrued expenses 236,126 228,376
----------- ------------
TOTAL CURRENT LIABILITIES 409,752 379,602
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY (DEFICIENCY):
Common stock, $.001 par value;
15,000,000 shares authorized,
9,198,679 shares issued and outstanding 9,199 9,199
Additional paid-in-capital 5,273,780 5,273,780
Accumulated deficit (5,692,202) (5,661,903)
----------- ------------
TOTAL SHAREHOLDERS' DEFICIENCY (409,223) (378,924)
----------- ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 529 $ 678
=========== ============
<PAGE>
PLAYORENA INC.
STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Six months ended
-------------------------- -------------------------
May 31, May 31, May 31, May 31,
1999 1998 1999 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
EXPENSES:
General and administrative $ 18,449 $ 5,000 26,049 $ 10,000
Interest Expense 2,125 21,884 4,250 43,768
---------- ----------- ---------- -----------
TOTAL EXPENSES 20,574 26,884 30,299 53,768
---------- ----------- ---------- -----------
NET LOSS $ (20,574) $ (26,884) (30,299) $ (53,768)
========== =========== ========== ===========
NET LOSS PER SHARE $ (0.00) $ 0.00 (0.00) $ (0.00)
========== =========== ========== ===========
WEIGHTED AVERAGE SHARES USED IN COMPUTATION 9,198,679 12,762,910 9,198,679 12,762,910
========== =========== ========== ===========
</TABLE>
<PAGE>
PLAYORENA INC.
STATEMENT OF CASH FLOWS
(UNAUDITED)
Six months ended
--------------------------
May 31, May 31,
1999 1998
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(30,299) $(53,768)
Change in operating assets and liabilities 7,750 53,768
-------- --------
CASH USED IN OPERATING ACTIVITIES (22,549) --
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from officer's advances 22,400 --
-------- --------
CASH PROVIDED BY FINANCING ACTIVITIES 22,400 --
-------- --------
NET DECREASE IN CASH (149) --
-------- --------
CASH AT BEGINNING OF YEAR 678 --
-------- --------
CASH AT END OF PERIOD $ 529 $ --
======== ========
<PAGE>
PLAYORENA, INC.
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MAY 31, 1999
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying financial statements are unaudited, but reflect all
adjustments which, in the opinion of management, are necessary for a
fair presentation of financial position and the results of operations
for the interim periods presented. Unless noted, all such adjustments
are of a normal and recurring nature. These financial statements should
be read in conjunction with the financial statements and related
footnotes for the year ended November 30, 1998 included in the Form
10-KSB for the year then ended. The results of operations for any
interim period are not necessarily indicative of the results attainable
for a full fiscal year.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
In light of the fact that the Company divested all of its operations
and sold all of its assets in July 1998, the Company is accounting for the
historical results of the business as discontinued operations. In this regard,
the following discussion and analysis presents a general, overall financial
summary of the discontinued operations, rather than a detailed discussion of the
results of operations recently disposed of. As presented in the Company's recast
financial statements, certain expenses, consisting of minimal general and
administrative expense and debt service costs have been evaluated to be expenses
attributable to the continuing entity after consideration of the divestiture of
operations.
In light of the fact that the Company has discontinued its operations,
no remedial measures will be necessary or taken to address the Year 2000
computer issue.
The following discussion and analysis should be read in conjunction
with the Financial Statements and Notes thereto appearing elsewhere in this
report.
RESULTS OF OPERATIONS -
COMPARISON OF QUARTERS ENDED MAY 31, 1999 AND MAY 31, 1998
During both the six months ended May 31, 1999 and 1998, revenues of
discontinued business were $0.
The Company stopped operating its discontinued business in fiscal year
ended November 30, 1997.
LIQUIDITY AND CAPITAL RESOURCES
At May 31, 1999, the Company had a shareholders deficiency of $409,223
compared to $378,924 at May 31, 1998. The Company is seeking an acquisition or
merger with an operating business. Given the Company's retention of substantial
liabilities following the consummation of the sale of substantially all its
assets in July, 1998, the Company is concerned about its ability to attract such
an operating company, and is examining all options available to it in response
thereto.
<PAGE>
PROPOSED TRANSACTIONS
The Company intends to acquire the business of Global Travel Network,
LLC, a limited liability company doing business in the state of New Jersey
("Global"). Global is a provider of travel packages and travel related services.
Currently, the Company is contemplating acquiring from Global, in exchange for
shares of Common Stock of the Company, all of the outstanding membership
interests of Global. Immediately thereafter, a wholly-owned subsidiary of the
Company would merge with and into Global, in exchange for shares of Common Stock
of the Company, with Global as the surviving corporation (the "Merger").
Following the Merger, Global would be a wholly-owned subsidiary of the Company.
The Company is currently negotiating the agreement with respect to the
acquisition of the business of Global. It is contemplated that the Company's
wholly-owned subsidiary formed for such purposes will merge into Global in a tax
free reorganization within the meaning of Sections 351 and/or 368 of the
Internal Revenue Code of 1986, as amended. Consummation of the transaction is
subject to the approval of holders of a majority of the membership interests of
Global. The Merger is subject to a number of conditions, and there can be no
assurance that an agreement with respect to the Merger will be entered into, or
that the Merger will be consummated.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings. To the best knowledge of the officers and
directors, neither the Company nor any of its officers and directors
are party to any legal proceeding or litigation.
Item 2. Changes in Securities. None.
Item 3. Defaults Upon Senior Securities. None.
Item 4. Submission of Matters to a Vote of Security Holders.
The Company had entered into (i) an Agreement and Plan of
Merger with SmartLink Development Network, Inc., Todtman,
Nachamie, Spizz & Johns, P.C. and King Communications
International, Ltd. and (ii) an Asset Purchase and Sale
Agreement with SmartLink Development Network, Inc., Todtman,
Nachamie, Spizz & Johns, P.C., King Communications
International, Ltd., Frank Eccles and Robert Geaghan to
acquire two separate companies which are providers of wireless
voice and data products and systems to the private two-way
land mobile radio industry, as more particularly described in
the Company's most recent Annual Report on Form 10-KSB.
However, on April 22, 1999, SmartLink Development Network,
Inc. sent a letter to the Company exercising its right to
terminate the proposed transaction, which such termination was
accepted by the Company. Accordingly, the special meeting of
shareholders scheduled to approve certain matters relating to
that transaction was cancelled.
Item 5. Other Information. None.
Item 6. (A) Exhibits
Exhibit No. Description
27.1 Financial Data Schedule
(B) Reports on Form 8-K. None.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
has caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Date: July 15, 1999 PLAYORENA INC.
By: /s/ Lawrence Kaplan
Lawrence Kaplan, President and
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> NOV-30-1999
<PERIOD-START> DEC-01-1998
<PERIOD-END> MAY-31-1999
<CASH> 529
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 529
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 529
<CURRENT-LIABILITIES> 409,752
<BONDS> 0
0
0
<COMMON> 9,199
<OTHER-SE> (418,422)
<TOTAL-LIABILITY-AND-EQUITY> 529
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 26,049
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,250
<INCOME-PRETAX> (30,299)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
