<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: November 30, 1996
Commission file number: 33-68570
LEGGOONS, INC.
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(Exact name of registrant as specified in its charter)
MISSOURI 43-1239043
---------------------- -------------------------------------
(State of incorporation) (I.R.S. Employer Identification number)
400 South Lindell, Vandalia, Missouri, 63382
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(Address of principal executive offices and Zip Code)
(573) 594-6418
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(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.
Yes X No ______
Number of shares of common stock outstanding as of December 31, 1996:
2,787,000
Transitional Small Business Disclosure Format (Check one): Yes No X
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Leggoons, Inc.
Index
Page
PART I. Financial Information
Item 1. Financial Statements
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5-6
Notes to Financial Statements 7-8
Item 2. Plan of Operations 9
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K 10
Signature 10
EX-27 Financial Data Schedule 11
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<PAGE>
PART I-FINANCIAL INFORMATION
Item 1. Financial Statements
LEGGOONS, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
November 30, August 31,
1996 1996
----------- ---------
ASSETS (Unaudited) (Audited)
<S> <C> <C>
Total Assets $ 0 $ 0
---------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Due to stockholder $ 22,635 $ 8,188
Accounts payable 17,918 12,339
---------- ---------
Total current liabilities 40,553 20,527
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Commitments and Contingencies
Stockholders' Equity:
Common stock, $.01 par value, authorized
10,000,000 shares; issued and outstanding,
2,787,000 27,870 27,870
Preferred stock, $.01 par value, authorized
5,000,000 shares; issued and outstanding
- none - -
Additional paid-in capital 3,522,792 3,522,792
Accumulated deficit (3,591,215) (3,571,189)
----------- -----------
Total stockholders' equity (40,553) (20,527)
----------- -----------
$ 0 $ 0
=========== ===========
</TABLE>
See accompanying notes to interim financial statements.
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LEGGOONS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months Ended
------------------
November 30,
1996 1995
---- ----
<S> <C> <C>
General and Administrative Expenses $ 20,026 $ 15,270
----------- -----------
Loss from Continuing Operations (20,026) (15,270)
------------ ------------
Discontinued Operations
Loss from discontinued apparel operations 0 (202,295)
Loss on disposal of apparel operations,
including provision for operating losses
during the phase-out period 0 0
----------- -----------
Loss from Discontinued Operations 0 (202,295)
----------- ------------
Net Loss $ (20,026) $ (217,565)
============ ============
Net Loss per Common Share $ (.01) $ (.08)
============ ============
Weighted average shares outstanding 2,787,000 2,787,000
</TABLE>
See accompanying notes to interim financial statements.
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<PAGE>
LEGGOONS, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months Ended
---------------------------------
November 30, November 30,
1996 1995
------------ ------------
<S> <C> <C>
Cash Flows From Operating Activities
Continuing operations:
Net loss $(20,026) $(15,270)
Changes in assets and liabilities:
Accounts payable 5,579 0
Cash used in continuing operations (14,447) (15,270)
Discontinued operations:
Net loss 0 (202,295)
Adjustments to reconcile net loss to net cash
provided (used) by discontinued operations:
Depreciation and amortization 0 35,410
Gain on investment in partnership 0 (3,500)
Changes in assets and liabilities:
Accounts receivable 0 20,616
Due from sales representatives 0 10,352
Inventories 0 46,804
Deferred charges 0 19,839
Prepaid expenses 0 27,687
Accounts payable 0 (23,652)
Accrued expenses 0 12,361
------- --------
Net cash used by discontinued operations 0 (56,378)
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Cash Used in Operating Activities (14,447) (71,648)
-------- --------
Cash Flows From Investing Activities:
Discontinued operations:
Decrease in other assets 0 0
Distributions from partnership 0 326
-------- --------
Net Cash provided by investing activities 0 326
-------- --------
</TABLE>
See accompanying notes to interim financial statements.
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<PAGE>
LEGGOONS, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months Ended
-----------------------------
November 30, November 30,
1996 1995
------------ ------------
<S> <C> <C>
Cash Flows From Financing Activities:
Continuing operations:
Proceeds from additional borrowings from
stockholder 14,447 0
----------- ---------
Cash provided by continuing operations 14,447 0
Discontinued operations:
Proceeds from additional borrowings from
stockholder 0 92,891
Net proceeds (payments) on note payable to
bank 0 (8,744)
Principal payments on long-term debt 0 (18,000)
----------- ----------
Cash provided by discontinued operations 0 66,147
----------- ----------
Cash provided by financing activities 14,447 66,147
----------- ----------
Net decrease in cash 0 (5,175)
Cash at beginning of period 0 9,881
----------- ----------
Cash at end of period $ 0 $ 4,706
=========== =========
</TABLE>
See accompanying notes to interim financial statements.
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<PAGE>
LEGGOONS, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
1. Unaudited Interim Periods:
The information furnished herein relating to interim periods has not
been audited by independent Certified Public Accountants. In the opinion of
the Company's management, the financial information in this report reflects
any adjustments that are necessary for a fair statement of results for the
interim periods presented in accordance with generally accepted accounting
principles. All such adjustments are of a normal and recurring nature. The
accounting policies followed by the Company, and additional footnotes, are
set forth in the audited financial statements included in the company's
Annual Report Form 10-KSB/A filed with the SEC in January 1997.
2. Initial Public Stock Offering:
On November 18, 1993, the Company completed an initial public offering
in which it sold 900,000 Units at $3.125 per Unit. Each Unit consisted of
one share of Common Stock and one Class A Warrant. Three Warrants entitle
the holder thereof to purchase one share of Common Stock at $3.75 per share
and expire on November 18, 1997. The warrants are callable in total by the
Company after November 18, 1994, at a redemption price of $.05 per warrant
upon 60 days prior notice if the common stock has traded above $3.75 for at
least 20 out of the 30 trading days preceding the date of the notice of
redemption.
3. Earnings (loss) Per Share:
Net earnings (loss) per share are computed using the weighted average
number of common and common equivalent shares outstanding during the period.
The Class A Warrants issued during the public offering are anti-dilutive and
have not been included in the computation of common equivalent shares
outstanding. Fully diluted net earnings (loss) per share for all periods
presented is not materially different from primary net earnings (loss) per
share.
4. Income Taxes:
Effective September 1, 1987, the Company elected to be taxed under
Subchapter S of the Internal Revenue Code. As such, the Company's taxable
income or loss was included in the individual tax returns of its shareholders
for Federal and State income tax purposes. Upon the closing of the public
stock offering on November 18, 1993, the Company terminated its Subchapter S
election. The company adopted Statement of Financial Accounting Standards
No. 109, "Accounting for Income Taxes". effective September 1, 1993, the
impact of which was immaterial.
At November 30, 1996, the Company had unused net operating losses to
carry forward against future years' taxable income of approximately
$2,790,000 expiring in various amounts from 2009 to 2011.
-7-
5. Discontinued Operations
On January 19, 1996, the Company adopted a formal plan to discontinue
the designing, selling, manufacturing and distribution of its apparel
products. As part of such plan, the Company discontinued production on
April 30, 1996 and culminated with the Assignment for Benefit of Creditors
on June 12, 1996.
6. Disposition of Assets and Liabilities:
On June 12, 1996, the Company transferred all of its assets and
liabilities to a third party assignee, under an "Assignment for the Benefit
of Creditors." An Assignment is a business liquidation device available as
an alternative to bankruptcy. The third party assignee, a Nebraska
corporation, also named Leggoons, Inc. (the "Assignee"), will be required to
properly, timely, and orderly dispose of all remaining assets for the benefit
of creditors. The net liabilities as of June 12, 1996, were removed from the
Company's financial statements by a corresponding credit to additional
paid-in capital of $1,132,722. The Company will continue to maintain its'
status as a shell corporation.
7. Accumulated Deficit:
As a result of the termination of the Company's S Corporation status on
November 18, 1993, the accumulated deficit of $1,168,375 incurred through
that date was closed out against additional paid-in capital. The $3,591,215
of deficit on the balance sheet at November 30, 1996, is the result of
operations from November 18, 1993, to November 30, 1996.
8. Subsequent Event:
Infinitron Investments International, Inc. Stock Acquisition Agreement
----------------------------------------------------------------------
The Company has concluded settlement negotiations of a dispute with
Infinitron Investments International, Inc. ("Infinitron"), who, under a
Stock Acquisition Agreement, had previously agreed to acquire the Company.
Final settlement documents are currently being circulated for signatures.
Generally, under the terms of the settlement, the Company is to receive
$510,000 in cash over a period of six months from Infinitron, along with
186,721 shares of Infinitron common stock, which represents approximately 3%
of Infinitron's outstanding shares of common stock on August 5, 1996. The
186,721 shares of common stock of Infinitron will be held for the benefit of
the Company's stockholders as their "loss of the bargain" under the proposed
merger. The $510,000 of cash proceeds will be distributed in accordance with
the Assignment for Benefit of Creditors.
-8-
<PAGE>
Item 2. PLAN OF OPERATIONS
General:
The Company is currently satisfying its cash requirements by obtaining
advances from its principal stockholder, James S. Clinton. Mr. Clinton is
also the President and a member of the Board of Directors of the Company.
Mr. Clinton has advised the Company that he will continue to provide cash
advances for operations for at least the next twelve months. It is
anticipated that the Company will employ one or two employees in the next
twelve months to provide for the procedures required to market the public
shell for merger or acquisition.
The primary general and administrative expenses incurred during the
quarterly period ended November 30, 1996, were legal expenses related to the
settlement negotiations with Infinitron.
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<PAGE>
FORM 10-QSB
LEGGOONS, INC.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - None.
(b) Reports on Form 8-K - A Current Report on Form 8-K dated as of
On November 18, 1996, was filed with respect to the Company's
extension of their warrant expiration date to November 18, 1997.
SIGNATURE:
- ----------
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.
(Registrant) LEGGOONS, INC.
BY(Signature) /s/ Steven D. Walters
(Date) January 20, 1997
(Name and Title) Steven D. Walters
Chief Financial Officer
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<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> NOV-30-1996
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 40,553
<BONDS> 0
0
0
<COMMON> 2,787,000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 20,026
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (20,026)
<INCOME-TAX> 0
<INCOME-CONTINUING> (20,026)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (20,026)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
