SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB/A1
[ X ] Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended March 31, 1996
[ ] TRANSITION REPORT UNDER SECTION 10 OR 15(d) OF THE EXCHANGE
ACT
Commission File Number 0-18186
JJFN Holdings, Inc.
(Exact name of small business issuer as specified in its charter)
Delaware 84-1062032
(State or other jurisdiction (I.R.S. Identification number)
of incorporation or organization)
100 Quentin Roosevelt Blvd, Suite 202, Garden City, New York 11530
(address of principal executive offices)
(516) 683-8116
(Issuer's Telephone Number, Including Area Code)
(Former name, former address and former fiscal year,
if changed since last report)
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
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
Outstanding Equity Securities at April 26, 1996
Class of Securities Outstanding Shares
Common Stock, $.001 par value, 4,067,000 shares
Preferred Stock, $.01 par value, 904,585 shares
Traditional Small Business Disclosure Format
Yes X No
JJFN HOLDINGS, INC.
Index to Quarterly Report on Form 10-QSB
For the Quarter Ended March 31, 1996
Part 1. FINANCIAL INFORMATION
Page Number
Item 1. Financial Statements
Consolidated Balance Sheets as of March 31, 1996
and June 30, 1995. 3
Consolidated Statements of Operations
for the three month and nine month periods ended
March 31, 1996 and 1995. 4-5
Consolidated Statements of Cash Flows
for the nine months ended March 31, 1996 and 1995. 6
Notes to Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. 8-10
Part II. OTHER INFORMATION
ITEM 5. PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS: 11
Pro Forma Condensed Consolidated Balance Sheet 12
March 31, 1996
Pro Forma Condensed Consolidated Statement of Operations
for the period November 2, 1995 through March 31, 1996 13
ITEM 6 Exhibit 27. Financial Data Schedule
ITEM 6(a) Reports on Form 8K.
On January 10, 1996 the Company filed a Form 8K/A due
to a change in the Registrant's Accountants
On March 13, 1996 the Company filed a Form 8K
acquiring certain assets of Iron Eagle Contracting Corp.
SIGNATURE PAGE
<TABLE>
JJFN HOLDINGS, INC. AND SUBSIDIARY
<CAPTION>
Consolidated Balance Sheets
Assets
<S> <C> <C>
(unaudited)
March 31, June 30,
Assets 1996 1995
Cash $2,766,219 $ -
Contract receivables 48,750 -
Marketable securities 500,000 -
Land and development costs 353,446 -
Prepaid expenses 63,375 -
Construction equipment, net of accumulated
depreciation of $9,806 186,298 -
Loan to affiliate 911,626 -
Deferred financing costs and other assets 356,046 -
Total assets $5,185,760 $ -
Liabilities and Stockholders' Equity
Liabilities:
Line of credit $ 154,381 $ 323,608
Accounts payable and accrued expenses 149,019 54,500
Stockholder loans 512,500 -
Long-term debt, 474,747 -
Total Liabilities 1,290,647 378,108
Stockholders' equity:
Preferred stock, $.01 par value 9,046 9,046
25,000,000 share authorized
904,585 shares issued and outstanding
Common stock, $.001 par value 4,067 137
50,000,000 shares authorized
4,067,000 shares issued and outstanding in March 1996
137,000 shares issued and outstanding in June 1995
Additional paid in capital 8,828,583 4,267,513
Accumulated deficit (4,946,583) (4,654,804)
Total stockholders' equity 3,895,113 (378,108)
Total liabilities and stockholders' equity $5,185,760 $ -
</TABLE>
<TABLE>
JJFN HOLDINGS, INC. AND SUBSIDIARY
<CAPTION>
CONSOLIDATED STATEMENTS OF OPERATIONS
Nine months ended
March 31,
(unaudited)
<S> <C> <C>
1996 1995
Revenues $ 48,750 $ -
Cost of revenues 39,002 -
Gross profit 9,748 -
General and administrative expenses:
Consulting fees 140,000 -
Other 102,569 19,275
Loss from operations (232,821) (19,275)
Other (income) expenses
Interest income (2,629) -
Interest and financing costs 61,587 32,064
Net loss $ (291,779) $ (51,339)
Net loss per common share $ (0.21 $ (.38)
Weighted average number of common shares 1,381,738 136,896
</TABLE>
<TABLE>
JJFN HOLDINGS, INC. AND SUBSIDIARY
<CAPTION>
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended
March 31,
<S> <C> <C>
Unaudited
1996 1995
Revenues $ 48,750 $ -
Cost of revenues 39,002 -
Gross Profit 9,748 -
General and administrative expenses:
Consulting fees 0 -
Other 59,012 6,425
Loss from operations (49,264) (6,425)
Other (income) expenses
Interest income (2,629) -
Interest and financing costs 36,932 10,688
Net loss $ (83,567) $ (17,113)
Net loss per common share $ (0.03) $ (0.13)
Weighted average number of common shares 3,099,868 136,896
</TABLE>
<TABLE>
JJFN HOLDINGS, INC. AND SUBSIDIARY
<CAPTION>
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended
March 31,
<S> <C> <C>
1996 1995
Net loss $ (291,779) $ 51,339
Adjustment to reconcile net loss to net cash
used in operating activities:
Amortization expense 6,876 -
Depreciation expense 9,806 -
Stock issued for consulting services 140,000 -
Changes in assets and liabilities
net of effects from asset acquisition:
increase in contract receivables (48,750) -
increase in prepaid expenses (63,325) -
increase in organization costs (284) -
increase in accounts payable and
accrued expenses 79,238 19,275
increase in accrued interest and
financing costs 46,554 32,064
Total adjustments 170,115 51,339
Net cash used in operating activities (121,664) -
Cash flows from investing activities:
Cash acquired in asset acquisition 339,900 -
Investment in real estate (353,446) -
Capital expenditures (7,754) -
Deferred offering costs (15,000) -
Net cash used in investing activities (36,300) -
Cash flows from financing activities:
Proceeds from stockholder loans 12,500 -
Loan to affiliate (911,626) -
Proceeds from note payable 100,000 -
Principal payments on long term debt (1,691) -
Proceeds from issuance of stock and options 3,725,000 -
Net cash provided by financing activities 2,924,183 -
Net increase in cash 2,766,219 -
Cash at beginning of period - -
Cash at end of period $2,766,219 -
</TABLE>
JJFN HOLDINGS, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
FOOTNOTE 1. BASIS OF PRESENTATION
The consolidated financial statements include the accounts of JJFN Holdings,
Inc. and its subsidiary ("Company"). In the opinion of management, the
accompanying unaudited Consolidated financial statements contain all
adjustments (consisting of only normal recurring adjustments, primarily
elimination of all significant inter-company transactions and accounts)
necessary to present fairly the financial position, results of operations
and cash flows for the periods presented. Certain financial statement
items from prior periods have been reclassified to be consistent
with the current period financial statement presentation. The financial
statements do not include all disclosures required by generally accepted
accounting principles.
These consolidated financial statements should be read in conjunction with
the consolidated financial statements and the related disclosures contained
in the Company's Annual Report on Form 10-KSB for the year ended June 30,
1995, its quarterly report for the six months ended December 31, 1995 and
the Registration Statement on Form S-4 filed with the Securities and
Exchange Commission.
The results of operations for the nine months ended March 31, 1996 are not
necessarily indicative of the results to be expected for the full fiscal
year.
FOOTNOTE 2. MARKETABLE SECURITIES
During April 1996 the Company sold fifty percent of its marketable securities
for $250,000. There was no gain or loss on the sale.
FOOTNOTE 3. DEFERRED FINANCING COSTS AND OTHER ASSETS.
Restrictive Covenants $275,333
Customer Contacts 57,071
Deferred financing and offering costs 22,776
Other 866
$356,046
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
History and Overview
From July 1992 to December 29, 1995, JJFN was a "shell" company, whose sole
purpose was to located and consummate a merger or other transaction in which
its shareholders would realize some value on their stock.
On December 29, 1995, JJFN acquired the stock of Iron Eagle Contracting and
Mechanical Inc., a newly organized and privately held construction
corporation. Iron Eagle Contracting Mechanical Inc. was organized in
December 1995 to engage in the construction business in the metropolitan
New York area to serve principally as a subcontractor for conduit and
piping work (laying repair and maintenance of gas, telephone electric and
water lines) and also to engage in the construction of residential homes
on land in Queens, New York.
Merger Agreement
On December 29, 1995, the Company executed an agreement to merge with JJFN
Services, Inc. ("Services"). Under the terms of the proposed agreement,
Priority Financial, Inc. ("PFI"), a wholly owned subsidiary of Services,
shall be merged into JJFN which shall be the surviving subsidiary
corporation. On the effective date of the merger, each non-dissenting
JJFN shareholder shall be entitled to receive one share of Services
common stock for each share of the Company's common stock. The preferred
shareholders shall be entitled to receive on share of Services common
stock for each 50 shares of preferred stock owned. On the effective date
of the merger, Services will also assume the Company's rights and
obligations under the agreements with Tarlton above as well as other
obligations of the Company.
The merger agreement also provides that Services shall file a registration
statement with the Securities and Exchange Commission in order to register
all shares issued to JJFN shareholders and those shares issued pursuant to
the agreements. The agreement is subject to the registration statement
becoming effective.
Results of Operations
The table below summarizes JJFN's results of operations during each of the
periods presented.
Three months ended Nine Months ended
March 31, March 31,
1996 1995 1996 1995
Revenues $48,750(2) $ -(1) $ 48,750(2) $ -(1)
Gross Profit 9,748 - 9,748 -
Net Loss $83,567 $17,113 $291,779 $51,339
(1) The Company was inactive and incurred interest costs on its debt
and professional expenses ordinary to a public company whether
active or inactive.
(2) Represents less than three months of actual operations.
Other Operating Results
Interest and Financing Costs:
The Company has incurred interest and financing costs on existing indebtedness
at the quarterly rate of $10,688 despite the inactive status. During the
third quarter These costs increased by approximately $26,300 as a direct
result of its need to borrow additional funds to implement its business plan.
Corporate General and Administrative Expenses:
Corporate General and Administrative Expenses totaled $59,012 and $232,821
respectively during the three and nine months periods ended March 31, 1996 as
compared to $6,425 and $19,275 respectively for the three and nine-month
periods ended March 31, 1995. The increase was due primarily to consulting
fees of $140,000 with the balance resulting from the costs associated with
an operating company versus the maintenance costs associated with an
inactive company.
Liquidity and Capital Resources:
On December 8, 1995, JJFN entered into an agreement with Tarlton Financial,
Ltd. Of Grand Cayman, Cayman Islands, British West Indies, pursuant to
which JJFN sold Tarlton, for a price of $125,000, an option expiring on
August 8, 1996 to purchase up to 5,000,000 shares of JJFN Common Stock at
a price of $1.50 per share. In January and February 1996, Tarlton
exercised this option to purchase 2,500,000 JJFN shares. In conjunction
of the issuance of the Tarlton option, JJFN entered into a consulting
agreement with Tarlton pursuant to which Tarlton is to perform various
services, including assistance in finding up to $7,500,000 in equity
capital (which may be fulfilled by exercise of Tarlton's option). As
compensation for its services, JJFN is to issue to Tarlton over a period
of eight months 1,250,000 shares of JJFN's Common Stock, conditioned upon
Tarlton success in obtaining the $7,500,000 in equity. These 1,250,000
shares, 500,000 of which have already been issued, will be canceled if
Tarlton fails to provide the full $7,500,000 in equity financing called
for by the consulting agreement.
On December 21, 1995, Iron Eagle Contracting and Mechanical also entered a
consulting agreement with Priority Capital Corp. of Garden City, New York.
As part of the services to be furnished to Iron Eagle Contracting and
Mechanical under the consulting agreement, Priority Capital has obtained
for Iron Eagle Contracting and Mechanical a $7 million bonding line from
Universal Bonding Company. This line has not yet been used but will
permit Iron Eagle Contracting and Mechanical to bid on jobs.
On January 2, 1996 Iron Eagle Contracting and Mechanical purchased a tract
of land in Ozone Park, Queens, New York for $300,000. In order to finance
the acquisition of Iron Eagle Contracting and Mechanical real property and
provide working capital for its future activities, Iron Eagle Contracting
and Mechanical entered into as loan agreement with VJS International
Holdings, Inc. on December 21, 1995, pursuant to which VJS will make a
total of $600,000 in advances to Iron Eagle, with interest at the rate
of 12% per annum. Loans were originally payable on March 31, 1996, but
have been extended by VJS, and are secured by a lien on all of Iron Eagle
Contracting and Mechanical's assets. Aside from its ordinary operations
Iron Eagle Contracting and Mechanical is developing the Ozone Park
site for two-family homes. It anticipates that proceeds from the VJS
line of credit will be sufficient to permit it to conduct his activity
and to carry on ordinary operations for a period of at least 12 months.
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 of the
undersigned thereunto duly authorized.
JJFN Holdings, Inc.
By: /s/Joan Kushay
Joan Kushay
Vice President and Assistant
Secretary (Duly Authorized
Officer)
Date: May 6, 1996
JJFN HOLDINGS, INC.
Financial Data Schedules
As of March 31, 1996 and for the nine-month period then ended
Article 5 of Regulations S-Xhis schedule contains summary financial
information extracted from the condensed consolidated financial
statements filed with Form 10QSB for the quarterly period ended
March 31, 1996 and is qualified in its entirety by reference to
such financial statements.
[TYPE] EX-27
[DESCRIPTION] Art. 5 FDS for 3rd Quazrter 10-QSB
[ARTICLE] 5
<TABLE>
<S> <C>
<Period-Time> 9-most
[FISCAL-YEAR-END] June 30, 1996
[PERIOD-END] March 31, 1996
[CASH] 2,766,219
[SECURITIES] 500,000
[RECEIVABLES] 48,750
[ALLOWANCES] 0
[INVENTORY] 0
<Current Assets> 4,289,970
[PP&E] 196,104
[DEPRECIATION] 9,806
<Total Assets> 5,205,760
<Current Liabilities> 315,106
[BONDS] 463,041
[COMMON] 4,067
[PREFERRED-MANDATORY] 0
[PREFERRED] 9,046
[OTHER-SE] 3,882,000
<Total-Liabilities and equity> 3,895,113
[SALES] 48,750
<Total Revenues> 48,750
[CGS] 39,002
<Total Costs> 39,002
[OTHER-EXPENSES] 242,569
<Loss Provision> 0
[INTEREST-EXPENSE] 61,587
[INCOME-PRETAX] (291,779)
[INCOME-TAX] 0
<Income-Continue> (291,779)
[DISCONTINUED] 0
<Extraordinary.> 0
[CHANGES] 0
<Net loss> (291,779)
<Earnings-primary> (0.21)
<Earnings-diluted> 0
</TABLE>
