SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Quarterly Report Under Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For Quarter Ended: December 31, 1996
Commission File Number: 33-15750-LA
OPTIFUND, INC.
(Exact name of registrant as specified in its charter)
Arizona 86-025995
(State of incorporation) (I.R.S. Employer
Identification No.)
3720 East Mountain View, Phoenix, Arizona 85028
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(602) 996-0800
Indicate by check mark whether 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 registrant was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical date.
6,460,005 shares of Class A Common Stock, no par value,
as of December 31, 1996.
OPTIFUND, INC. AND SUBSIDIARY
FORM 10-Q
Table of Contents
PART I FINANCIAL INFORMATION Page
Item 1. Financial Statements
A. Consolidated Balance Sheets 3
Dec 31, 1996 (unaudited) &
Dec 31, 1995 (unaudited)
B. Consolidated Statements of 4
Operations Three Months Ended
Dec 31, 1996 (unaudited) &
Dec 31, 1995 (unaudited)
C. Consolidated Statements of 5
Cash Flows Three Months Ended
Dec 31, 1996 (unaudited) &
Dec 31, 1995 (unaudited)
D. Notes to Consolidated Financial 6
Statements
Item 2. Management's Discussion and Analysis 6
of Financial Condition and Results
of Operations
PART II OTHER INFORMATION 10
SIGNATURES 11
OPTIFUND, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
December 31, December 31,
1996 1995
____________________________
ASSETS
CURRENT ASSETS:
Cash $ 13,039 $ 578
___________ ___________
Total Current Assets $ 13,039 $ 578
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accrued expenses and other
Liabilities $ 3,000 $ 2,000
___________ ___________
Total Current Liabilities $ 3,000 $ 2,000
STOCKHOLDERS EQUITY:
Common Stock 2,484,734 2,464,734
Accumulated Deficit (2,474,695) (2,466,156)
___________ ___________
TOTAL STOCKHOLDERS EQUITY $ 10,039 $ ( 1,422)
TOTAL LIABILITIES &
STOCKHOLDERS EQUITY $ 13,039 $ 578
<FN>
See notes to consolidated Financial Statements.
OPTIFUND, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
December 31,
___________________________
1996 1995
REVENUES $ -0- $ -0-
EXPENSES
Selling, general and
administrative expenses $ 411 $ 887
___________ ___________
NET INCOME OR (LOSS) $ (411) $ (887)
___________ ___________
NET INCOME OR LOSS PER COMMON
SHARE -0- -0-
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 6,460,005 5,510,005
<FN>
See notes to Consolidated Financial Statements.
OPTIFUND, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
December 31, 1996
1996 1995
_________________________
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income or (Loss) $ ( 411) $ ( 887)
_______ _________
Net Cash Used In Operations ( 411) ( 887)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings from stock-
holder $ -0- $ 2,000
________ ________
NET CASH PROVIDED BY
FINANCING ACTIVITIES $ -0- $ 2,000
________ ________
NET INCREASE (DECREASE) IN
CASH $ ( 411) $ ( 887)
CASH, beginning of period 13,450 1,465
________ ________
CASH, end of period $ 13,039 $ 579
<FN>
See notes to Consolidated Financial Statements.
Optifund, Inc. and Subsidiary
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. BASIS OF CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements of the Company
have been prepared by the Company and are unaudited. In the opinion
of management, all adjustments necessary for the fair presentation of
this information, including normal recurring accruals and adjustments,
have been made.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in conformance with
generally accepted accounting principles have been omitted. This
report should be read in conjunction with the Company's consolidated
financial statements as set forth in Form 10-K filed by the Company
with the Securities and Exchange Commission (the "Commission") for
the year ended March 31, 1996. The results of operations for the
interim period are not necessarily indicative of the results to be
obtained for the entire year.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
As a result of continuing financial difficulties, in June 1989,
the Company sold substantially all of its assets to Kamar, Inc.
(Kamar). Pursuant to the terms of the purchase agreement, Kamar
purchased substantially all of the Company's assets and assumed
certain of the Company's liabilities and since then the Company
has conducted no operations. Consequently, during the quarters
ended Dec 31, 1996, and Dec 31, 1995, the Company had no sales
and did not incur any costs of goods sold.
The expenses incurred during the three-month periods ended
Dec 31, 1996 and Dec 31, 1995 were nominal.
LIQUIDITY AND CAPITAL RESOURCES
The Company has virtually no liquidity. The Company continues
to exist, but no longer operates as a manufacturer of printed circuits.
The only source of liquidity has been loans made by Mr. Robert G.
Loeb, the Company's largest shareholder. In view of the Company's
financial condition, credit is not available to the Company. The
Company has no means of repaying the loans, other than through the
issuance of stock. Loan proceeds have been applied to pay expenses
necessary to continue the Company's existence, wind down operations,
and resolve various matters, including a dispute with the Internal
Revenue Service. The Company continues to have a need for legal and
accounting services to maintain its existence. To date these services
and other expenses have been funded by Mr. Robert G. Loeb, the principal
shareholder, who has loaned monies to the Company to pay expenses.
The Company has engaged in various transactions with its largest
shareholder, Mr. Robert G. Loeb. As of July 23, 1992, Mr. Loeb agreed
to discharge $15,324 in debts owed to him by the Company in exchange
for the issuance of 750,000 shares of the Company's Class A Common Stock
at a price of $0.02 per share. Mr. Loeb had advanced the $15,324 to
the Company in order to meet operating costs. In addition, Mr. Loeb
contributed $6,000 for 300,000 shares of the Company's Class A Common
Stock at a price of $ 0.02 per share. Such amounts were applied by the
Company to pay legal and accounting expenses.
LIQUIDITY AND CAPITAL RESOURCES - continued
In addition to paying the Company's expenses, Mr. Loeb previously
delivered a personal note to the Company's legal counsel agreeing to
pay attorneys' fees. As of July 23, 1992, the Company's Board of
Directors authorized the issuance of up to 1,250,000 shares of the
Class A Common Stock to members of the Board of Directors and other
sophisticated persons in order to obtain funds to pay the Company's
obligations.
Effective as of August 1, 1992, the Company redeemed 1,687,500
shares of Mr. Loeb's Class B Common Stock at a price of $0.01 per
share in accordance with the mandatory redemption provisions of the
Articles of Incorporation relating to these shares. Mr. Loeb's Class
B Shares have been surrendered and cancelled. Notwithstanding the
fact the Company did not have sufficient cash to pay the redemption
price, Mr. Loeb agreed to accept a demand note in the amount of
$16,875. from the Company for the redemption price. In March 1993
Mr. Loeb agreed to accept the issuance of 843,750 shares of its
Class A Common Stock at a price of $0.02 per share, in payment
of the note. In addition, 66,255 shares of Class A Common Stock
were issued to Mr. Loeb in exchange for advances Mr. Loeb had
made to the Company to cover operating expenses and the payment
of taxes.
As of March 15, 1994, the Board of Directors authorized the
issuance of an additional 600,000 shares of the Company's Class A
Common Stock to Mr. Loeb in exchange for $12,000. advanced by
Mr. Loeb to the Company to cover the Company's operating expenses.
As of March 14, 1995, the Board of Directors authorized the
issuance of an additional 1,000,000 shares of the Company's Class A
Common Stock to Mr. Loeb in exchange for $20,000. Mr. Loeb had
advanced to the Company.
As of March 31, 1996 the Board of Directors agreed to issue
an additional 1,000,000 shares of its Class A Common Stock in
consideration of Mr. Loeb's agreeing to discharge $20,000. of
indebtedness owed to him by the Company. These share were issued
to Mr. Loeb on April 12, 1996.
Management of the Company continues to explore possibilities
of merging the Company with a business interested in becoming
publicly owned and, in that connection, management has explored a
number of different opportunities, none of which have come to
fruition. Management is currently exploring the possibility of the
Company entering into one or more joint ventures that would allow
the Company to generate income, thereby making the Company more
attractive if an appropriate merger candidate is identified. Although
no assurances can be given management believes that a merger with
another company seeking to acquire a publicly owned corporation is
the most favorable means by which shareholders will obtain any return
of their investment. The Company has no significant assets other than
its tax loss carry foreward and does not have material tangible assets.
LIQUIDITY AND CAPITAL RESOURCES - continued
The Company has also contacted investment bankers to assist
it in identifying possible merger candidates who may be able to
take advantage of the Company's tax loss carry forward or its
publicly held status. To date, these efforts have not been successful.
If continuing efforts to exploit these opportunities fail, the Company
may liquidate.
Before recommending liquidation, management intends to explore all
available opportunities that would allow shareholders to recover some
portion of their investment.
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
(A) Exhibits required by Item 601 of Regulation S-K
No. Description
Exhibit 4 Instruments defining the rights of security
holders, including indentures:
a. Article IV of the Articles of Incorporation
of Optifund, inc., filed as Exhibit 4.A to
Optifund's Registration Statement of Form S-18
(File No. 33-15750-LA) effective September 2,
1987, and incorporated herein by reference.
b. Section 5 of Optifund, Inc.'s Bylaws filed
as Exhibit 4.B to Optifund's Registration
Statement of Form s-18 (File No. 33-15750-LA)
effective September 2, 1987, and incorporated
herein by reference.
(b) Report on Form 8-K
The Company did not file any reports on Form 8-k during the
three month period ended December 31, 1996.
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.
OPTIFUND, INC.
Registrant
February 14, 1997 Robert G. Loeb
Date Robert G. Loeb
Chief Executive Officer
and Chairman of the Board
OPTIFUND, INC.
INDEX TO EXHIBITS TO FORM 10-Q
Exhibit Description
Exhibit 4 Instruments defining the rights of securities
holders, including indentures:
A. Article IV of the Articles of Incorporation
of Optifund, filed as Exhibit 4.A to
Optifund's Registration Statement on Form
S-18 (File No.33-15750-LA), effective
September 2, 1987, and incorporated herein
by reference.
B. Section 5 of Optifund's Bylaws filed as
Exhibit 4.B of Optifund's Registration
Statement on Form S-18 (File No.33-15750-LA),
effective September 2, 1987, and incorporated
herein by reference.