Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
May 31, 2016 | Jun. 30, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | MAGNA LAB INC | |
Entity Central Index Key | 895,464 | |
Document Type | 10-Q | |
Document Period End Date | May 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-28 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 1,179,329 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | May 31, 2016 | Feb. 29, 2016 |
CURRENT ASSETS: | ||
Cash | $ 3,000 | $ 11,000 |
Prepaid expense | 3,000 | |
Total assets | 3,000 | 14,000 |
CURRENT LIABILITIES: | ||
Notes payable and accrued interest payable to a shareholder | 834,000 | 816,000 |
Accounts payable, including approximately $68,000 which is payable to a related party | 418,000 | 415,000 |
Accrued expenses and other current liabilities | 43,000 | 41,000 |
Total liabilities | 1,295,000 | 1,272,000 |
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, par value $.01 per share, 5,000,000 shares authorized, none issued | 0 | 0 |
Common stock, Class A, par value $.001 per share, 120,000,000 shares authorized, 1,176,373 shares issued and outstanding | 1,000 | 1,000 |
Common stock, Class B, par value $.001 per share, 3,750,000 shares authorized, 18,750 shares issued, 10,000 share forfeited, 5,794 shares converted to Class A and 2,956 shares outstanding | 0 | 0 |
Capital in excess of par value | 27,180,000 | 27,180,000 |
Accumulated deficit | (28,473,000) | (28,439,000) |
Total stockholders' deficit | (1,292,000) | (1,258,000) |
Total liabilities and stockholders' deficit | $ 3,000 | $ 14,000 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($) | May 31, 2016 | Feb. 29, 2016 |
Liabilities | ||
Approximate amount due to Company's President for expenses paid on the Company's behalf (in dollars) | $ 68,000 | |
Stockholders Equity | ||
Preferred Stock Par Value | $ 0.01 | $ 0.01 |
Preferred Stock Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock Shares Issued | 0 | 0 |
Common Stock Class A Par Value | $ 0.001 | $ 0.001 |
Common Stock Class A Shares Authorized | 120,000,000 | 120,000,000 |
Common Stock Class A Shares Issued | 1,176,373 | 1,176,373 |
Common Stock Class A Shares Outstanding | 1,176,373 | 1,176,373 |
Common Stock Class B Par Value | $ 0.001 | $ 0.001 |
Common Stock Class B Shares Authorized | 3,750,000 | 3,750,000 |
Common Stock Class B Shares Issued | 18,750 | 18,750 |
Common Stock Class B Shares Outstanding | 18,750 | 18,750 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
May 31, 2016 | May 31, 2015 | |
Income Statement [Abstract] | ||
REVENUES | $ 0 | $ 0 |
OPERATING EXPENSES: | ||
General and administrative | 16,000 | 15,000 |
LOSS FROM OPERATIONS | (16,000) | (15,000) |
OTHER EXPENSE - Interest expense | 18,000 | 16,000 |
NET LOSS | $ (34,000) | $ (31,000) |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED | 1,179,000 | 1,179,000 |
NET LOSS PER COMMON SHARE, BASIC AND DILUTED | $ (.03) | $ (.03) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
May 31, 2016 | May 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (34,000) | $ (31,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Prepaid expenses | 3,000 | 3,000 |
Accounts payable, accrued liabilities and all other | 23,000 | 14,000 |
NET CASH USED IN OPERATING ACTIVITIES | (8,000) | (14,000) |
CASH PROVIDED BY FINANCING ACTIVITIES: | ||
Proceeds received from notes payable to stockholder | 0 | 10,000 |
NET INCREASE (DECREASE) IN CASH | (8,000) | (4,000) |
CASH: | ||
Beginning of period | 11,000 | 12,000 |
End of period | $ 3,000 | $ 8,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Stockholders Deficit (Unaudited) - 3 months ended May 31, 2016 - USD ($) | Class A common stock | Class B common stock | Capital in Excess of Par Value | Accumulated Deficit |
Shares, Balance, Beginning at Feb. 29, 2016 | 1,176,373 | 2,956 | ||
Value, Balance, Beginning at Feb. 29, 2016 | $ 1,000 | $ 27,180,000 | $ (28,439,000) | |
Net Loss | (34,000) | |||
Shares, Balance, Ending at May. 31, 2016 | 1,176,373 | 2,956 | ||
Value, Balance, Ending at May. 31, 2016 | $ 1,000 | $ 27,180,000 | $ (28,473,000) |
NOTE 1 - BASIS OF PRESENTATION
NOTE 1 - BASIS OF PRESENTATION AND CONSOLIDATION | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 1 - BASIS OF PRESENTATION AND CONSOLIDATION | The accompanying condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X for smaller reporting companies and do not include all of the information and disclosures required by accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements include the accounts of Magna-Lab Inc. and its wholly owned subsidiary, Cardiac MRI, Inc. (collectively, the Company) and all significant intercompany transactions and balances have been eliminated in consolidation. All adjustments which are of a normal recurring nature and, in the opinion of management, necessary for a fair presentation have been included. These condensed consolidated financial statements should be read in conjunction with the more complete information and the Companys audited consolidated financial statements and related notes thereto included in the Company's annual report on Form 10-K for the year ended February 29, 2016. The operating results for the three months ended May 31, 2016 are not necessarily indicative of the results that may be expected for the year ending February 28, 2017. |
NOTE 2 - DISCUSSION OF THE COMP
NOTE 2 - DISCUSSION OF THE COMPANY'S ACTIVITIES/PRODUCTS AND GOING CONCERN CONSIDERATION | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 2 - COMPANY'S ACTIVITIES AND GOING CONCERN CONSIDERATION | Company Activities - The Company was previously engaged in research, development and commercialization activities until it ceased such activities during the period September 2002 through March 2003. The Companys efforts to raise additional capital or enter into a strategic arrangement in order to complete commercialization of its cardiac diagnostic Illuminator products and development of its Artery View product or to seek other means to realize value through sale, license or otherwise have been unsuccessful. Going Concern Consideration |
NOTE 3 - NET LOSS PER COMMON SH
NOTE 3 - NET LOSS PER COMMON SHARE | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 3 - NET LOSS PER COMMON SHARE | The Company complies with the accounting and reporting requirements of U.S. GAAP with respect to computing its net loss per common share. Net loss per common share is computed based on the weighted average number of Class A Common and Class B Common shares outstanding. Basic loss per share excludes dilution and is computed by dividing loss available to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Since there are no options, warrants or derivative securities outstanding, basic and diluted loss per share were the same for the three month periods ended May 31, 2016 and 2015. |
NOTE 4 - NOTES PAYABLE - RELATE
NOTE 4 - NOTES PAYABLE - RELATED PARTY | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 4 - NOTES PAYABLE - RELATED PARTY | Notes payable include 12% unsecured notes payable to the Companys principal stockholder, Magna Acquisition LLC (MALLC) in the aggregate principal amount of $479,000, plus approximately $355,000 of interest accrued. Such notes become due 120 days after issuance and, as such, approximately $479,000 principal amount of such notes are overdue at May 31, 2016. The notes that are overdue bear interest at 15% per year subsequent to their maturity date. On June 7, 2016, MALLC loaned an additional $25,000 to the Company on the same terms as above. The Company intends to make a proposal to this principal stockholder to convert all amounts outstanding to them (including overdue amounts) into common stock of the Company. |
NOTE 5 - ACCOUNTS PAYABLE AND A
NOTE 5 - ACCOUNTS PAYABLE AND ACCRUALS | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 5 - ACCOUNTS PAYABLE AND ACCRUALS | Approximately $106,000 of accounts payable relates to intellectual property counsel fees and costs including approximately $68,000 of which that has been paid by and is therefore due to the Companys Chairman and President for payments he has made on the Companys behalf to preserve certain intellectual property rights. This officer ceased making such payments several years ago and, as such, the underlying intellectual property became compromised. Accrued expenses and other current liabilities includes approximately $18,000 payable to a third party, guaranteed by our principal stockholder, for amounts paid to an account payable in October 2007 on our behalf. This amount is repayable if the proposed merger transaction with this party was not completed. This party subsequently merged with a third party and abandoned its possible transaction with the Company, however there has not been a demand for repayment of this amount. The Company believes it would be entitled to an offset for recovery of certain costs from this third party associated with that proposed transaction pursuant to understandings between the parties. Some of the amounts recorded as accounts payable may have passed the statute of limitations for purposes of the vendor seeking recovery of such monies. The Company has not undertaken a formal study to evaluate recorded payables past the statute of limitations for purposes of possible write-off of such payables. See also Notes 3 and 8 to the audited consolidated financial statements included in the Companys Annual Report on Form 10-K for the year ended February 29, 2016 for other information on outstanding liabilities and related matters. There was no activity in the restructuring accrual for the pre-1997 activities during the three months ended May 31, 2016 or 2015. The Company periodically adjusts the remaining accrual based on the status of the matters and activity given the passage of time. |
NOTE 6 - STOCK BASED COMPENSATI
NOTE 6 - STOCK BASED COMPENSATION | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 6 - STOCK BASED COMPENSATION | In accordance with GAAP, the Company recognizes the cost of employee services received in exchange for awards of equity instruments in the financial statements based on the grant date fair value of those awards. Stock awards to consultants and other non-employees are accounted for based on an estimate of their fair value at the time of grant. The fair value of each option or warrant grant under GAAP is estimated on the date of the grant using the Black-Scholes option pricing model with the following weighted-average assumptions: risk free interest rate of 5%; no dividend yield; expected option lives of five to nine years and expected volatility in excess of 200%. In April 2004, the Board of Directors agreed to reserve 90,000 shares of class A common stock for issuance to directors and management in the event that their efforts result in Board approval of a merger or financing transaction. The criteria for recognition of this share compensation was met on July 24, 2008 and the Company recorded stock-based compensation expense of approximately $10,000 reflecting the fair value of the 90,000 shares at the date of entry into the agreement at the closing bid price of the Companys stock. Because of cash constraints, the Company has not been able to issue such shares. However, for accounting purposes, the Company has accounted for such shares as though they have been issued. |
NOTE 7 - EFFECT OF RECENT ACCOU
NOTE 7 - EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
NOTE 7 - EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS | In August 2014, the FASB issued ASU 2014-15, Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying condensed consolidated financial statements. |
NOTE 2 - DISCUSSION OF THE CO14
NOTE 2 - DISCUSSION OF THE COMPANY'S ACTIVITIES AND GOING CONCERN CONSIDERATION (Details Narrative) - USD ($) | 3 Months Ended | ||
May 31, 2016 | May 31, 2015 | Feb. 29, 2016 | |
Note 2 - Discussion Of Companys Activities And Going Concern Consideration Details Narrative | |||
Cash | $ 3,000 | $ 11,000 | |
Total stockholders' deficit | (1,292,000) | $ (1,258,000) | |
Net loss | $ (34,000) | $ (31,000) |
NOTE 4 - NOTES PAYABLE - RELA15
NOTE 4 - NOTES PAYABLE - RELATED PARTY (Details Narrative) | 3 Months Ended |
May 31, 2016USD ($) | |
Note 4 - Notes Payable - Related Party Details Narrative | |
Notes payable | $ 479,000 |
Accrued interest | 355,000 |
Overdue notes payable | $ 479,000 |
NOTE 5. ACCOUNTS PAYABLE AND AC
NOTE 5. ACCOUNTS PAYABLE AND ACCRUALS (Details Narrative) | May 31, 2016USD ($) |
Note 5. Accounts Payable And Accruals Details Narrative | |
Accounts payable relating to intellectual property | $ 106,000 |
Approximate amount due to Company's President for expenses paid on the Company's behalf (in dollars) | 68,000 |
Accrued expenses and other current liabilities due to third party | $ 18,000 |
NOTE 6. STOCK BASED COMPENSATIO
NOTE 6. STOCK BASED COMPENSATION (Details Narrative) | 3 Months Ended |
May 31, 2016USD ($) | |
Note 6. Stock Based Compensation Details Narrative | |
Black-Scholes option pricing model risk free interest rate assumption weighted-average | 5.00% |
Black-Scholes option pricing model dividend yield assumption weighted-average | $ 0 |
Black-Scholes option pricing model expected option life minimum | 5 years |
Black-Scholes option pricing model expected option life maximum | 9 years |
Black-Scholes option pricing model expected volatility weighted-average | 200% |