Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 For the quarterly period ended June 30, 1998 .
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT For the transition period from to
Commission file number 0-23026
Paramark Enterprises, Inc.
(Exact name of small business issuer as specified in its charter)
Delaware 22-3261564
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or organization) No.)
One Harmon Plaza, Secaucus, New Jersey 070940
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(Address of principal executive offices)
201-422-0910
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(Issuer's telephone number including area-code)
135 Seaview Drive, Secaucus, New Jersey 07094
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(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 __
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
stock as of the latest practicable date:
Common Stock, $.01 par value - 3,373,883 shares as of August 14, 1998.
Transitional Small Business disclosure Format (check one):
Yes X No ___
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Paramark Enterprises Inc.
PART I FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS PAGE
Balance Sheets at December 31, 1997 and 3
June 30, 1998.
Statements of Operations for the three and six 4
months ended June 30, 1997 and June 30, 1998.
Statements of Cash Flows for the three and six 5
months ended June 30, 1997 and June 30, 1998.
Notes to Financial Statements 6
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
PART II
Item 1 Legal Proceedings 13
Item 2 Changes in Securities 13
Item 3 Defaults upon Senior Securities 13
Item 4 Submission of Matters to a Vote
of Security Holders 13
Item 5 Other Information 14
Item 6 Exhibits and Reports on Form 8-K 14
SIGNATURES 15
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PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS
PARAMARK ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
December 31, March 31,
1997 1998
(Audited) (Unaudited)
ASSETS
<S> <C> <C>
Current Assets:
Cash $122,561 $0
Accounts receivable, less allowance for doubtful accounts 259,271 279,255
Notes receivable - current maturities 69,837 71,535
Inventory 234,822 171,173
Prepaid expenses and other current assets, net 35,291 40,275
----------- -----------
Total current assets 721,782 562,238
Property and equipment 453,296 530,771
Deferred transaction costs 0 27,842
Excess of cost over fair value of net assets acquired 476,667 449,167
----------- -----------
Total Assets $1,651,745 $1,570,018
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $1,142,415 $1,370,491
Current maturities of long-term debt 258,545 574,752
----------- -----------
Total current liabilities 1,400,960 1,945,243
Long-term debt, net of current maturities 69,460 0
----------- -----------
Total liabilities 1,470,420 1,945,243
----------- -----------
STOCKHOLDERS' EQUITY
Preferred Stock 0 0
Common Stock 30,702 33,740
Additional paid-in capital 6,759,352 6,813,705
Accumulated deficit (6,608,729) (7,222,670)
----------- -----------
Total stockholders' equity 181,325 (375,225)
----------- -----------
Total Liabilities and Stockholders' Equity $1,651,745 $1,570,018
=========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
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PARAMARK ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
For the Three Months For the Six Months
Ended June 30, Ended June 30,
1997 1998 1997 1998
Revenue:
<S> <C> <C> <C> <C>
Wholesale sales $560,175 $1,266,701 $982,714 $2,490,697
Sales from Company-owned stores 43,175 36,584 94,558 72,114
Royalties and licensing fees 61,759 30,000 83,555 60,000
----------- ----------- ----------- -----------
Total revenue 665,109 1,333,285 1,160,827 2,622,811
Operating expenses:
Cost of goods sold 441,912 1,001,541 797,123 1,986,839
Selling, general and administrative 586,081 527,243 971,760 1,134,179
----------- ----------- ----------- -----------
Total operating expenses 1,027,993 1,528,783 1,768,883 3,121,017
----------- ----------- ----------- -----------
Loss from operations (362,884) (195,499) (608,056) (498,207)
----------- ----------- ----------- -----------
Other income (expense):
Interest income (expense), net 8,857 (99,247) 31,618 (105,577)
Loss from sale of assets 0 (10,157) 0 (10,157)
Other income 8,820 0 63,936 0
----------- ----------- ----------- -----------
Total other income (expense) 17,078 (109,405) 95,555 (115,735)
----------- ----------- ----------- -----------
Net income (loss) ($345,806) $(304,903) ($512,501) ($613,941)
=========== =========== =========== ===========
Net income (loss) per common share ($0.11) ($0.10) ($0.17) ($0.19)
=========== =========== =========== ===========
Weighted average number of
common shares outstanding 3,068,833 3,197,960 3,068,833 3,197,960
=========== =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
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PARAMARK ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
For the Six Months
Ended June 30,
1997 1998
<S> <C> <C>
Cash flow from operating activities:
Net income (loss) ($512,501) ($613,941)
Adjustments to reconcile net income (loss) to net cash from
operating activities:
Depreciation and amortization 48,941 73,121
Non cash loss from sale of equipment 0 10,157
Noncash consulting fees and interest expense 0 57,390
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable 119,297 (19,984)
(Increase) decrease in inventories (89,692) 63,649
(Increase) decrease in prepaid expenses and other current assets (3,049) (4,983)
(Increase) decrease in deferred transaction costs 0 (27,842)
Increase (decrease) in accounts payable and accrued expenses (237,770) 233,076
Increase (decrease) in other current liabilities 0 0
--------- ---------
Net cash used in operating activities (674,774) (229,357)
--------- ---------
Cash flows from investing activities:
Purchases of equipment (71,203) (133,252)
--------- ---------
Net cash used in investing activities (71,203) (133,252)
--------- ---------
Cash flows from financing activities:
Proceeds from financing 163,855 970,991
Proceeds from notes receivable 658,303 (1,698)
Payment of notes payable (115,266) (729,245)
--------- ---------
Net cash provided by financing activities 706,892 240,048
--------- ---------
Net increase (decrease) in cash (39,085) (122,561)
Cash at beginning of period 49,677 122,561
Cash at end of period $10,582 $0
========= =========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
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<PAGE>
Paramark Enterprises, Inc.
Notes to Financial Statements
(Unaudited)
Note 1 - Basis of Presentation
The accompanying financial statements have been prepared by the Company, in
accordance with generally accepted accounting principles and pursuant to the
Rules and Regulations of the Securities and Exchange Commission, and except
for the Balance Sheet at December 31, 1997, all statements are unaudited. In
the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the interim period are not necessarily indicative of
financial results for the full year.
Additionally, certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principals have been omitted. It is suggested that these
unaudited financial statements be read in connection with the financial
statements and notes thereto included in the Company's Annual Report on Form
10-KSB for the fiscal year ended December 31, 1997. There have been no
significant changes of accounting policies since December 31, 1997.
Note 2 - Net Income (Loss) Per Common Share
Net loss per common share is calculated by dividing net loss by the weighted
average number of shares of common stock outstanding for each period
presented. For purposes of these computations, shares issuable upon the
exercise of all common stock purchase options and warrants outstanding have
been excluded from the computation of weighted average shares outstanding
since their effect is antidilutive.
Note 3 - Income Taxes
No provision for income taxes has been made for the six months ended June
30, 1998 as the Company has net operating losses. These net operating losses
have resulted in a deferred tax asset at June 30, 1998. Due to the
uncertainty regarding the ultimate amount of income tax benefits to be
derived from the Company's net operating losses, the Company has recorded a
valuation allowance for the entire amount of the deferred tax asset at June
30, 1998.
Note 4 - Sale of Assets
In August 1996, the Company closed a purchase agreement (the "Transaction")
with Triarc Restaurant Group d/b/a/ Arby's, Inc. ("Triarc") through which
(a) Triarc purchased the trademarks, service marks, recipes and secret
formulas of the Company, (b) Triarc licensed back to the Company the rights
to operate existing franchised bakery locations and to distribute T.J.
Cinnamons products
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<PAGE>
through retail grocery outlets, and (c) the Company entered into a
management agreement with Triarc to manage the franchise system.
The Company received payments of $1,790,000 at the closing, a promissory
note in the amount of $1,650,000 which is being paid in fifteen (15) equal
monthly installments beginning October 1, 1996, a promissory note in the
amount of $100,000 which is being paid in twenty four (24) equal monthly
installments beginning October 1, 1996. In addition, the purchase agreement
provides for the contingent payments of up to a maximum of an additional
$5,500,000 over time dependent upon the amount of T.J. Cinnamons product
sales by Triarc exceeding a minimum base system wide sales of $26.3 million.
Simultaneous with the closing of the Transaction in August 1996, the Company
entered into an agreement with Heinz Bakery Products to terminate the 1992
manufacturing and license agreement. Under the terms of the agreement, the
Company paid Heinz Bakery Products $600,000 at closing, and assigned to
Heinz the Triarc promissory note in the amount of $100,000 payable with
interest in equal installments over a two year period.
On June 30, 1998, the Company executed an agreement with TJ Holding
Company, Inc., a wholly owned subsidiary of Triarc and Arby's, Inc. d/b/a/
Triarc (the "1998 Triarc Agreement") pursuant to which the Company will
sell all of its rights and interests under the existing T.J. Cinnamons
franchise agreements and will terminate the purchase agreement dated June
3, 1996 and the license agreement and management agreement entered into
with Triarc and affiliates dated August 29, 1996. The Company will receive
payments under the 1998 Triarc Agreement aggregating $4,000,000 to be paid
as follows: $3,000,000 in cash and $1,000,000 in the form of a non-interest
bearing promissory note payable over 24 months. The agreement further
provides for a contingent additional payment of up to $1,000,000
conditioned on the Company's attainment of certain sales targets of T.J.
Cinnamons products for the fiscal year ending December 31, 1998.
On August 11, 1998 the Company's shareholders approved the 1998 Triarc
Agreement, and a closing has been tentatively scheduled for the end of
August 1998.
Note 5 - Short Term Financing
In June 1997 the Company entered into a loan agreement with Gelt Financial
Corporation for a credit line in the amount of $200,000 which was
subsequently increased to $400,000 secured by Wal-Mart accounts receivable.
The terms of this loan agreement provide for a service fee of 1.5% of each
advance together with interest at a rate of 675 basis points above the
prime rate.
In March 1998, Charles Loccisano, the Company's Chairman and Chief
Executive Officer and Alan Gottlich, the Company's President and Chief
Financial Officer provided the Company with a credit line in the amount of
$500,000. The credit line is required to be repaid within one year, with
interest payable quarterly at the rate of 5.39% per annum. In consideration
for the loan, Messrs. Loccisano and Gottlich were granted an aggregate of
300,000 shares of the Company's common stock.
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<PAGE>
PART I ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
When used in this Quarterly Report, the words or phrases "will likely result",
"are expected to", "will continue", "is anticipated", "estimate", "projected",
"intends to" or similar expressions are intended to identify "forward looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements are subject to certain risks and uncertainties that
could cause the Company's actual results to differ materially from historical
earnings and those presently anticipated or projected. As a result, potential
investors are cautioned not to place undue reliance on any such forward-looking
statements, which speak only as of the date made.
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 (for the three and six month periods ended June 30,
1998 compared to the three and six month periods ended June 30, 1997).
The following tables set forth the components of the Company's revenue:
Three Months Ended June 30,
1997 1998
Wholesale sales $560,175 $1,266,701
Company-owned bakery sales 43,175 36,584
Royalties and licensing fees 61,759 30,000
---------- ----------
Total Revenue $665,109 $1,333,285
Six Months Ended June 30,
1997 1998
Wholesale sales $982,714 $2,490,697
Company-owned bakery sales 94,558 72,114
Royalties and licensing fees 83,555 60,000
---------- ----------
Total Revenue $1,160,827 $2,622,811
Wholesale sales increased by 126% to $1,266,701 for the three months
ended June 30, 1997 from $560,175 for the three months ended June 30, 1996, and
increased by 153% to $2,490,697 for the six months ended June 30, 1997 from
$982,714 for the six months ended June 30, 1996. These sales increases were due
to a continued expansion of the Company's distribution of its products to
grocery stores, wholesale club stores and mass merchandisers. The Company is
continuing to develop its
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<PAGE>
wholesale sales in specific geographic areas through alliances with the
following key food brokerage groups: (a) Le Grand Marketing, representing retail
grocery stores California; (b) Food Scene, representing retail grocery stores in
the New York tri-state area, (c) J & J Brokers, representing retail grocery
stores in New England, (d) Priority Food Brokers, representing retail grocery
stores in Maryland and Virginia, and (e) American Sales and Marketing,
representing membership club stores nationwide and retail grocery stores in the
mid-west. The Company is targeting its product line to in-store bakeries and
in-store deli areas of supermarket chains, focusing on large multi-unit
accounts. The Company is focusing its marketing efforts on the following core
products: (a) T.J. Cinnamons Gourmet Cinnamon Rolls and Gourmet Sticky Rolls;
(b) T.J. Cinnamons CinnaChips; (c) Gourmet Rugalach; (d) Gourmet Brownies sold
under the Hershey's label; (e) Gourmet Bundt Cakes; (f) Gourmet specialty Cakes
and (g) Layer Cakes. All of these products are sold in various packaging and
sizes, and are shipped through both fresh and frozen distribution
The Company is currently selling products to the following accounts:
Ralphs Supermarkets, Food-4-Less Supermarkets, Luckys Supermarkets, H.E. Butt
Supermarkets, Hughs Supermarkets, Kings Supermarkets, D'Agostinos Supermarkets,
Walmart Super Centers, Costco Wholesale Clubs and Sams Wholesale Clubs.
Company-owned bakery sales decreased by 15% to $36,584 for the three
months ended June 30, 1998 from $43,175 for the three months ended June 30,
1997, and decreased by 24% to $72,114 for the six months ended June 30, 1998
from $94,558 for the six months ended June 30, 1997. These bakery sales
decreases resulted from a decline in mall traffic due to a number of vacancies
in the Poughkeepsie Galleria mall. In April 1997, the Company entered into a
management agreement whereby the Poughkeepsie Galleria mall bakery will be
operated with all cash deficits funded by the manager and all positive cash flow
retained by the manager as a management fee. Pursuant to the terms of the 1998
Triarc Agreement, the Company closed the Poughkeepsie bakery in August 1998 and
is negotiating a lease termination settlement agreement with the landlord. The
lease term expires in June 2000.
Royalty and licensing fee revenues decreased to $30,000 for the three
months ended June 30, 1998 from $61,756 for the three months ended June 30,
1997, and decreased to $60,000 for the six months ended June 30 ,1998 from
$83,555 for the six months ended June 30, 1997. These decreases in royalties and
licensing fees resulted primarily from decreased franchise royalty collections
due primarily from the closings of franchised retail bakeries.
Cost of goods sold increased to $1,001,541 for the three months ended
June 30, 1998 from $441,912 for the three months ended June 30, 1997, and
increased to $1,986,839 for the six months ended June 30, 1998 from $797,123 for
the six months ended June 30, 1997. These increases were primarily the result of
the increased volume of product sales to supermarkets chains and membership club
chains.
Selling, general and administrative expenses decreased by 10% to
$527,243 for the three months ended June 30, 1998 from $586,081 for the three
months ended June 30, 1997, and increased by 17% to $1,134,179 for the six
months ended June 30, 1998 from $971,760 for the six months ended June 30, 1997.
The increases for the six months ended June 30, 1998 were primarily the result
of increases in
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selling, general and administrative costs associated with the Company's
manufacturing plant in Santa Ana, California and the selling and marketing
expenses associated with the launch of the Company's product line to wholesale
channels of distribution.
Net interest expense for the three months ended June 30, 1998 was
$99,247 as compared to net interest income for the three months ended June 30,
1997 of $8,857, and net interest expense for the six months ended June 30, 1998
was $105,577 as compared to net interest income for the six months ended June
30, 1997 of $31,618. This change in net interest expense resulted primarily from
the loan fees and interest expense associated with the Gelt Financial
Corporation line of credit and the line of credit provided to the Company by
Charles Loccisano, the Company's Chairman and Chief Executive Officer, and Alan
Gottlich, the Company's President and Chief Financial Officer.
The loss from the sale of assets of $10,157 for the six months ended
June 30, 1998 resulted from the write-off of leasehold improvements from the
relocation of the Company's executive offices in Secaucus, New Jersey.
Other income decreased to $0 for the three months ended June 30, 1998
from $8,820 for the three months ended June 30, 1997, and decreased to $0 for
the six months ended June 30, 1998 from $63,936 for the six months ended June
30, 1997. The decreases in other income for the three and six months ended June
30, 1997 resulted from reductions in accounts payable and accrued liabilities
resulting from discounted settlements and write-offs of accounts payable based
on their being no recent contact with the Company by the creditors being owed
such amounts.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1998, the Company had a working capital deficit of
approximately $1,383,000. During the six months ended June 30, 1998, the Company
experienced cash flow deficits from its operating activities primarily because
its operating expenses exceeded its operating revenues. These operating deficits
experienced during the six months ended June 30, 1998 were funded by a credit
line and short term loans provided to the Company by officers of the Company.
The Company used net cash in operating activities in the amount of
$229,357 for the six months ended June 30, 1998, as compared to $674,774 for the
six months ended June 30, 1997. The Company used net cash in investing
activities in the amount of $133,252 for the six months ended June 30, 1998, as
compared to net cash used in investing activities in the amount of $71,203 for
the six months ended June 30, 1997. The Company received net cash from financing
activities in the amount of $240,048 for the six months ended June 30, 1998 as
compared to net cash received from financing activities in the amount of
$706,892 for the six months ended June 30, 1997.
In June 1997, the Company entered into a loan agreement with Gelt
Financial Corporation for a credit line in the amount of $200,000 which was
subsequently increased to $400,000 secured by the Wal-Mart accounts receivable.
The terms of this loan agreement provide for a service fee of 1.5% of each
advance together with interest at a rate of 675 basis points above the prime
rate. The credit line balance was $0 on June 30, 1998.
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In October 1997, the Company offered for sale units in a convertible
preferred private placement with Commonwealth Associates acting as placement
agent. This offering was to be held open to investors through January 1998, and
was not consummated as orders for the minimum number of shares were not
obtained. Without alternative sources of financing to fund the Company's
operating deficit, in January 1998, Charles Loccisano, the Company's Chairman
and Chief Executive Officer, and Alan Gottlich, the Company's President and
Chief Financial Officer, provided the Company with loans aggregating $282,500.
In March 1998, based on the need for additional funding resulting from the
receipt of large purchase orders from Walmart Super Centers, the previous
Loccisano and Gottlich loans were repaid in full, and Messrs. Loccisano and
Gottlich agreed to provide the Company with a credit line for up to $500,000
with interest payable quarterly at the applicable federal rate of 5.39% per
annum. The credit line is required to be repaid within one year or such shorter
period if the Company closes the 1988 Triarc Agreement described below. In
consideration for providing this credit line facility, the Company granted
Messrs. Loccisano and Gottlich an aggregate of 300,000 unregistered shares of
Common Stock.
In November 1997, in order to bring the Company into compliance with
requirements necessary for continued listing on the Nasdaq SmallCap Market,
Messrs. Loccisano and Gottlich purchased an aggregate of 20,000 shares of
redeemable Series B preferred stock at a price of $5.00 per share. In January
1998, following a delisting of the Company's securities from the Nasdaq SmallCap
Market and as a result of additional funds loaned to the Company by Messrs.
Loccisano and Gottlich, these shares of Series B preferred stock were redeemed
by the Company at a price of $5.00 per share.
On June 30, 1998, the Company executed an agreement with TJ Holding
Company, Inc., a wholly owned subsidiary of Triarc Restaurant Group and Arby's,
Inc. d/b/a/ Triarc Restaurant Group (the "1998 Triarc Agreement") pursuant to
which the Company will sell all of its rights and interests under the existing
T.J. Cinnamons franchise agreements and will terminate the purchase agreement
dated June 3, 1996 and the license agreement and management agreement entered
into with Triarc Restaurant Group and affiliates dated August 29, 1996. The
Company will receive payments under the 1998 Triarc Agreement aggregating
$4,000,000 to be paid as follows: $3,000,000 in cash and $1,000,000 in the form
of a non-interest bearing promissory note payable over 24 months. The agreement
further provides for a contingent additional payment of up to $1,000,000
conditioned on the Company's attainment of certain sales targets of T.J.
Cinnamons products for the fiscal year ending December 31, 1998. On August 11,
1998 the Company's shareholders approved the 1998 Triarc Agreement, and a
closing has been tentatively scheduled for the end of August 1998.
In July 1998 the Company borrowed $150,000 from Gelt Financial
Corporation. Such loan bears interest at the rate of 5% above the prime rate.
The loan is secured by all the payments due the Company under the purchase
agreement dated June 3, 1996 entered into with Triarc Restaurant Group. In order
to induce Gelt Financial Corporation to enter into this loan, the Company paid
Gelt Financial Group a placement fee in the amount of $15,625 and agreed to
issue Gelt Financial Group 15,000 shares of the Company's unregistered common
stock. This loan will be repaid out of the proceeds of the 1998 Triarc
Agreement.
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<PAGE>
In August 1998, Charles Loccisano, the Company's Chairman and Chief
Executive Officer, provided the Company with a short term bridge loan in the
amount of $100,000. The terms of the loan provide for a loan fee of 5%
representing the initial loan fees and interest on the loan. These loans will be
repaid out of the proceeds of the 1998 Triarc Agreement.
The Company anticipates that the net proceeds from the 1998 Triarc
Agreement, together with its anticipated lines of credit, and the Company's
anticipated cash from operations, should be sufficient to satisfy the Company's
cash needs through June 30, 1999. Should demand for the Company's products be
greater than anticipated, the Company might find it necessary to seek additional
financing or to reduce planned expenditures on marketing and product expansion
if sufficient financing cannot be obtained or obtained timely or on terms
acceptable to the Company.
Following consummation of the 1998 Triarc Agreement, the Company will
continue to manufacture and distribute gourmet bakery products to the retail
grocery and food service trade. However, following the termination of the
wholesale license agreement on December 31, 1998, the Company will no longer
manufacture and sell T.J. Cinnamons branded products, which represent 75% of
wholesale sales for the fiscal year ended December 31, 1997 and 61 % of
wholesale sales for the six months ended June 30, 1998. In addition, the Company
will no longer be entitled to any further payments under the purchase agreement
dated June 3, 1996 and the license agreement entered into with Triarc Restaurant
Group and affiliates dated August 29, 1996.
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<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Not Applicable
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Pursuant to recent amendments to the proxy rules under the
Securities and Exchange Act of 1934, as amended (the "Exchange
Act"), the Company's stockholders are notified that the
deadline for providing the Company timely notice of any
stockholder proposal to be submitted outside of the Rile 14a-8
process for consideration at the Company's 1999 Annual Meeting
of Stockholders (the "Annual Meeting") will be not less than
60 days nor more than 90 days prior to the Annual Meeting,
provided that if less than 70 days notice of prior public
disclosure of the Annual Meeting date is given, notice by
stockholders must be received not later than the close of
business on the 10th. day following the day on which notice of
the Annual Meeting was mailed or public disclosure thereof
made, which ever occurs first. As to all such matters which
the Company does not have notice on or prior to the applicable
time frame set forth above, shall not be considered or voted
upon at the Meeting. With respect to Rule 14a-8 requirements
applicable to inclusion of stockholder proposals in the
Company's proxy materials related to the Annual Meeting,
stockholder proposals regarding the Annual Meeting must be
submitted to the Company at its offices at One Harmon Plaza,
Secaucus, New Jersey 07094 within 120 days of the mailing date
for the 1998 Annual Meeting of Stockholders, or March 17, 1999
(or if the Annual Meeting date is changes by more than 30 days
from the 1998 Annual Meeting date, a reasonable time prior to
the Company's printing and mailing of proxy materials), to
receive consideration for inclusion in the Company's 1999
proxy materials. Any such proposal must also comply with proxy
rules under the Exchange Act.
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<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
The following exhibits are filed herewith.
Exhibit Number Description
27 Financial Data Schedule
(b) Reports on Form 8-K.
On July 9, 1998 the Company filed a Current Report on
Form 8-K disclosing the Company's execution of a
definitive agreement with TJ Holding Company, Inc.
and Arby's, Inc. regarding the sale of certain
assets, including the T.J. Cinnamons franchise
agreements, and the termination of the purchase
agreement dated June 3, 1996 and the license
agreement and management agreement entered into with
Triarc Restaurant Group dated August 29, 1996.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
Paramark Enterprises, Inc.
Dated: August 14, 1998 By: /s/ Charles N. Loccisano
Charles N. Loccisano,
Chairman and Chief Executive Officer
By: /s/ Alan S. Gottlich
Alan S. Gottlich,
President and Chief Financial Officer
(Principal Accounting Officer)
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements of Paramark Enterprises, Inc. as of June 30,
1998 and the six months then ended, and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<CIK> 0000915661
<NAME> PARAMARK ENTERPRISES, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
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