FORM 10-QSB - Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
UNITED STATES
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 period ended June 30, 1996
or
[ ] Transition Report Pursuance to Section 13 or 15(d) of the Securities
Exchange act of 1934.
For the transition period from to
Commission File Number 33-32341-D
SAGE RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Colorado 84-1127336
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
10 Exchange Place, Suite 309, Salt Lake City, Utah 84111
(Address of principal executive offices) (Zip Code)
(801) 364-3500
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year, if
changed since last report.)
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicated by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
[ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of June 30, 1996, Registrant had 4,220,000 shares of common stock, no Par
Value, outstanding.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
INDEX
Page
Number
Part I. Financial Information
Item I. Financial Statements
Condensed Balance Sheets as of June 30,
1996 (Unaudited) and December 31, 1995 3
Condensed Statements of Operations, Three
Months Ended June 30, 1996 and 1995
and for the period from January 6, 1989
(Inception) to June 30, 1996. (Unaudited) 4
Condensed Statements of Operations, Six
Months Ended June 30, 1996 and 1995
and for the period from January 6,
1989 (Inception) to June 30, 1996.
(Unaudited) 5
Condensed Statements of Cash Flows, Three
Months Ended June 30, 1996 and 1995 and
for the period from January 6, 1989
(Inception) to June 30, 1996. (Unaudited) 6
Condensed Statements of Cash Flows, Six
Months Ended June 30, 1996 and 1995
and for the period from January 6,
1989 (Inception) to June 30, 1996.
(Unaudited) 7
Notes to Condensed Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of
Operations 10
Part II. Other Information 11
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1996 1995
-------------- -------------
Current Assets:
Cash $ 9,504 $ 14,539
Subscription receivable 160 -
Note receivable 500,000 -
------------ -----------
TOTAL ASSETS $ 509,664 $ 14,539
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 895 $ -
Note payable 500,000 -
------------ -----------
Total Current Liabilities 500,895 -
------------ -----------
Stockholders' Equity:
Preferred stock - -
Common stock 164,947 50,547
(Deficit) accumulated during
development stage (156,178) (36,008)
------------ -----------
TOTAL STOCKHOLDERS' EQUITY 8,769 14,539
------------ -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 509,664 $ 14,539
============ ===========
Note: The balance sheet at December 31, 1995, has been taken from the
audited financial statements at that date and condensed.
The accompanying notes are an integral part of the financial statements.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
January
Three Months Three Months 6, 1989
Ended Ended (Inception) to
June 30, June 30, June 30,
1996 1995 1996
------------- ------------- --------------
Revenue:
<S> <C> <C> <C>
Interest income $ - $ 152 $ 6,598
----------- -------- -----------
Operating Expenses:
Rent 250 750 20,750
Consulting fees related
party 110,000 - 110,000
Legal & accounting 895 504 19,258
Stock issued for
consulting services 4,240 - 4,240
Other - 2,014 8,528
----------- --------- ------------
Total Operating Expense 115,385 3,268 162,776
----------- --------- ------------
Net (Loss) $ (115,385) $ (3,116) $ (156,178)
============ ========= ============
Net (Loss) per share $ (.05) $ (.05) $ (.07)
============ ========= ============
Weighted average number of
shares outstanding 2,140,000 60,000 2,140,000
============ ========= ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
January
Six Months Six Months 6, 1989
Ended Ended (Inception) to
June 30, June 30, June 30,
1996 1995 1996
---------------- ------------- ---------------
Revenue:
<S> <C> <C> <C>
Interest income $ 126 $ 317 $ 6,598
------------- ---------- -----------
Operating Expenses:
Rent 1,000 1,500 20,750
Legal & accounting 4,654 2,176 19,258
Consulting fees related
party 110,000 - 110,000
Stock issued for consult-
ing services 4,240 - 4,240
Other 402 2,184 8,528
-------------- ---------- -----------
Total Operating Expense 120,296 5,860 162,776
-------------- ---------- -----------
Net (Loss) $ (120,170) $ (5,543) $ (156,178)
============== ========== ===========
Net (Loss) per share $ (.06) $ (.09) $ (.07)
============== ========== ===========
Weighted average number of
shares outstanding 2,140,000 60,000 2,140,000
============== ========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
January
Three Months Three Months 6, 1989
Ended Ended (Inception) to
June 30, June 30, June 30,
1996 1995 1996
------------- -------------- ---------------
Operating Activities:
<S> <C> <C> <C>
Net (loss) $ (115,385) $ (3,116) $(156,178)
Adjustments to reconcile net
loss to net cash provided by
(used in) operating activities:
Amortization - - 200
(Increase) in subscription
receivable (160) - (160)
Increase (decrease) in accounts
payable and accrued rent (4,016) (314) 895
------------ -------- --------
Net Cash (Used in) Operating
Activities (119,561) (3,430) (155,243)
------------ -------- --------
Investing Activities:
Organization costs - - (200)
------------ -------- --------
Net Cash (Used in)
Investing Activities - - (200)
------------ --------- --------
Financing Activities:
Proceeds from issuance of
common stock 114,400 - 182,600
Deferred offering costs - - (17,653)
------------ --------- --------
Net Cash Provided by
Financing Activities 114,400 - 164,947
------------ --------- --------
Increase (Decrease) in Cash (5,161) (3,430) 9,504
Cash, Beginning of Period 14,665 21,570 -
------------ --------- --------
Cash, End of Period $ 9,504 $ 18,140 $ 9,504
=============== ========= ========
Cash paid for income taxes $ - $ - $ -
=============== ========= ========
Cash paid for interest expense $ - $ - $ -
=============== ========= ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
January
Six Months Six Months 6, 1989
Ended Ended (Inception) to
June 30, June 30, June 30,
1996 1995 1996
------------- ------------ ---------------
Operating Activities:
<S> <C> <C> <C>
Net (loss) $ (120,170) $ (5,543) $(156,178)
Adjustments to reconcile net
loss to net cash provided by
(used in) operating activities:
Amortization - - 200
(Increase in subscription
receivable (160) - (160)
Increase in accounts payable
and accrued rent 895 778 895
----------- --------- ---------
Net Cash Provided by (Used
in) Operating Activities (119,435) (4,765) (155,243)
----------- --------- ---------
Investing Activities:
Organization costs - - (200)
----------- --------- --------
Net Cash (Used in)
Investing Activities - - (200)
----------- --------- --------
Financing Activities:
Proceeds from issuance of
common stock 114,400 - 182,600
Deferred offering costs - - (17,653)
----------- --------- --------
Net Cash Provided by
Financing Activities 114,400 - 164,947
----------- ---------- --------
Increase (Decrease) in Cash (5,035) (4,765) 9,504
Cash, Beginning of Period 14,539 22,905 -
----------- ---------- --------
Cash, End of Period $ 9,504 $ 18,140 $ 9,504
============ ========== ========
Cash paid for income taxes $ - $ - $ -
============ ========== ========
Cash paid for interest expense $ - $ - $ -
============ ========== ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
December 31, 1995 and June 30, 1996 (Unaudited)
(1) Condensed Financial Statements
The condensed balance sheet as of June 30, 1996, the condensed statements
of operations and the condensed statements of cash flows for the periods
ended June 30, 1996 and 1995, have been prepared by the Company without
audit. In the opinion of management, all adjustments (which include only
normal recurring adjustments) necessary to present fairly the financial
position, results of operations and cash flows at June 30, 1996 and for all
periods presented have been made.
Certain information and footnote disclosures normally included in the
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that
these condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's December
31, 1995, Form 10-K. The results of operations for the three month periods
ended June 30, 1996 and 1995, are not necessarily indicative of the
operating results for the full years.
(2) Change of Control and Related transactions
Effective April 24, 1996 the controlling stockholder of the Company sold
17,000 shares of the Company's common stock entered 15,000 additional
shares into a voting trust agreement which transferred control of the
Company to Exchange Place Capital Partners. LLC, a Utah limited liability
company (Exchange).
The Company agreed to pay Exchange $110,000 for consulting services and
granted an option to Exchange allowing Exchange the right to purchase
160,000 shares of the Company's common stock for $160.
<PAGE>
SAGE RESOURCES, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS, CONTINUED
December 31, 1995 and June 30, 1996 (Unaudited)
(1) Condensed Financial Statements, Continued
The Company issued 4,000,000 shares of its common stock for $110,000 in
cash.
The financial statements as of June 30, 1996 include the issuance of the
160,000 shares even though the Form S-8 Registration statement was not
filed related to these shares until August, 1996. The difference between
the $160 option price of the shares and the $4,400 value of the shares
determined based upon the price per share paid for the 4,000,000 has been
accounted for as an expense in the financial statements and shown as stock
issued for consulting services. The $160 option price has been shown as
stock subscriptions receivable.
The Company borrowed $500,000 from Maroon Bells Capital Partners, Inc.
(Maroon Bells) and loaned this amount to Com Tech International Corporation
(Com Tech). The Company has also entered into a business combination
agreement with Com Tech. The note payable to Maroon Bells bears interest at
10% per annum, is collateralized by an assignment of the Con\m Tech note
receivable and if the Com Tech proposed business combination is
consummated, then upon demand of Maroon Bells, the note and accrued
interest will be converted into 250,000 shares of the Company's common
stock. If the closing of the business combination with Com Tech does not
occur then the note becomes due October 1, 1996. The note receivable from
Com Tech bears interest at 10% per annum and if the closing of the business
combination does not take place, the note will become due September 27,
1996. If the closing of the business combination occurs, the balance due on
the note will be deducted from the holders $3,500,000 new equity financing
requirement described in the business combination agreement. The Com Tech
note receivable is collateralized by an assignment of title and interest in
the Datamax joint Venture owned by Com Tech.
<PAGE>
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Sage Resources, Inc. (The Company) was formed on January 6, 1989,
to evaluate, structure and complete a merger with, or acquisition
of, other entities.
See the notes to the financial statements for a description of financial
commitments and related transactions.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
Form 8-K dated April 23, 1996 was filed regarding change of control of
the Company.
Form 8-K dated June 27, 1996 was filed regarding sale of 4,000,000
shares of the Company's common stock which
resulted in change of control of the Company.
<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.
SAGE RESOURCES, INC.
Date August 19, 1996 By: /s/ Jonathan Winters
Title: Director
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 504
<SECURITIES> 0
<RECEIVABLES> 500,160
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 509,664
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 509,664
<CURRENT-LIABILITIES> 500,895
<BONDS> 0
0
0
<COMMON> 164,947
<OTHER-SE> (156,178)
<TOTAL-LIABILITY-AND-EQUITY> 509,664
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 115,385
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (115,385)
<EPS-PRIMARY> (.05)
<EPS-DILUTED> (.05)
</TABLE>
