UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10Q/A
QUARTERLY REPORT PURSUANT TO SECTION 13 OF 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period Ending: October 31, 1996
______________
Commission File Number: 0-17623
________
Database Technologies, Inc.
(Exact name of registrant as specified in its charter)
Delaware 02-0429620
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
172 Route 101, Suite D-5, Bedford,NH 03110
(Address of principal executive offices) (Zip Code)
(603) 472-8222
(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.
[x ] Yes [ ] No
Number of shares outstanding of the issuer's classes of
common stock, as of October 31, 1996:
Common stock $.001 par value ...............................2,491,082
DATABASE TECHNOLOGIES,INC.
FORM 10Q OCTOBER 31, 1996
PART I: FINANCIAL INFORMATION
ITEM 1 - Financial Statements
(Amounts in hundreds, except per share data)
DATABASE TECHNOLOGIES,INC.
BALANCE SHEET
OCTOBER 31, 1996
OCTOBER 31,1996 APRIL 30,1996
( Unaudited) (*)
A S S E T S
CURRENT ASSETS:
Cash $ 4,119 $ 8,099
Accounts Receivable
-trade (Note 8) 5,596 3,749
(less allowance for doubtful accounts)
Other Current Assets 0 422
_____________ ________________
Total current assets 9,715 12,270
-------------- -----------------
PROPERTY AND EQUIPMENT (NOTE 1);
Equipment,Furniture & Fixtures 14,027 14,027
Less: Accumulated depreciation 13,938 13,938
_________________ _______________
Net property and equipment 89 89
OTHER ASSETS:
Other assets 150 150
______________ ______________
Net other assets 150 150
_____________ ____________
Total assets $ 9,954 $ 12,659
=============== ============
LIABILITIES AND STOCKHOLDERS EQUITY (Deficiency)
CURRENT LIABILITIES
Notes Payable
- officer/stockholder (Note 2) $ 152,730 $ 127,530
Accounts payable
- trade 4,238 4,243
- customer deposits 0 1,663
- accrued expenses 0 668
- payroll taxes payable 948 0
_______________ _______________
Total current liabilities 157,916 134,124
STOCKHOLDERS' EQUITY (Note 6)
Common stock-par value $0.001
authorized 2,500,000 shares,
2,491,082 issued 2,381 2,381
Additional paid-in capital 12,154 12,154
Accumulated Deficit (162,497) (136,000)
________________ _______________
Total stockholders' equity (147,962) (121,465)
_________________ _______________
Total liabilities and
stockholders' equity $ 9,954 $ 12,659
_________________ ______________
<FN>
The accompanying notes to financial statements are an integral
part of this statement.
___________________________________________________________________________
(*) Condensed from the Company's audited financial statements.
(Amounts in hundreds, except per share data)
DATABASE TECHNOLOGIES,INC.
STATEMENT OF OPERATIONS
THREE MONTHS ENDING OCTOBER 31,1996 and OCTOBER 31,1995
and
SIX MONTHS ENDING OCTOBER 31,1996 and OCTOBER 31,1995
Three Months Three Months Six Months Six Months
Ending Ending Ending Ending
Oct.31,1996 Oct.31,1995 Oct.31,1996 Oct. 31,1995
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
REVENUE $ 27,891 $ 48,721 $ 46,066 $ 93,182
COST OF REVENUE 10,648 24,824 13,350 43,132
__________ __________ _________ __________
Gross profit 17,243 23,897 32,716 50.050
OPERATING EXPENSES
Selling & Delivery 6,538 13,209 7,964 14,961
General & Admin. 23,977 16,223 51,249 41,202
___________ ___________ __________ __________
Total operating
expenses 30,515 29,432 59,213 56,163
Profit(loss) from
Operations (13,272) (5,535) (26,497) (6,116)
NET PROFIT (LOSS)
before income taxes (13,272) (5,535) (26,497) (6,116)
(Note 4)
Provision for Income
Taxes (Note 1) 0 0 0 0
NET INCOME (LOSS) ($13,272) ($5,535) ($26,497) ($6,116)
============= ============ =========== ===========
NET PROFIT (LOSS)
PER SHARE (Note 6) ($.005) ( $.002) ($.01) ($.002)
============= ============ =========== ===========
<FN>
The accompanying notes to financial statements
are an integral part of this statement.
(*) Condensed from the Company's audited financial statements.
DATABASE TECHNOLOGIES,INC.
STATEMENT OF STOCKHOLDERS' EQUITY
SIX MONTHS ENDING OCTOBER 31, 1996
Additional
Common Stock Paid-in Retained
Shares Amount Capital Earnings Total
BALANCE AT
April 30,1996 2,491,082 $2,381 $12,154 ($136,000) ($121,464)
Net Loss (26,497) (26,497)
___________ _________ ________ ___________ _________
BALANCE AT
Oct.31,1996 2,491,082 $2,381 $12,154 ($162,497) ($147,961)
<FN>
The accompanying notes to financial statements
are an integral part of this statement.
(*) Condensed from the Company's audited financial statements.
DATABASE TECHNOLOGIES,INC.
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDING OCTOBER 31, 1996 and OCTOBER 31, 1995
and
FOR THE SIX MONTHS ENDING OCTOBER 31, 1996 and OCTOBER 31,1995
Three Months Three Months Six Months Six Months
Ending Ending Ending Ending
Oct.31, 1996 Oct.31,1995 Oct.31,1996 Oct.31,1995
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
CASH FLOW FROM OPERATING ACTIVITES;
Net Income (Loss) ($13,272) ($5,535) ($26,497) ($6,116)
Adjustments to reconcile
net income (loss) to net
cash provided by operating
activities:
Depreciation & Amortization 0 0 0 0
(Increase) Decrease in the
following:
Assets:
Accounts Receivable
Trade (2,652) 1,352 (1,847) 1,916
Prepaid expense 0 0 0 0
(Decrease) Increase in the
following liabilities:
Accounts payable:
Trade 2,188 (9,005) (5) (10,463)
Stockholder 3,500 (402) (831) (6,876)
Deferred revenue 0 0 0 0
Accrued Expenses 610 0 0 0
_________ ___________ ___________ __________
Net cash used in
Operating Activities (9,626) (13,590) (29,180) (21,539)
CASH FLOWS FROM
FINANCING ACTIVITIES:
Notes Payable:
-officer/stockholder 13,200 17,689 25,200 24,388
________ __________ __________ _________
NET INCREASE (DECREASE)
IN CASH 3,574 4,099 (3,980) 2,849
CASH,Beginning of period 545 4,096 8,099 5,346
_________ ___________ __________ _________
CASH,End of period 4,119 8,195 4,119 8,195
__________ __________ __________ ________
The accompanying notes to financial statements
are an integral part of this statement.
DATABASE TECHNOLOGIES,INC.
NOTES TO FINANCIAL STATEMENTS
April 30, 1996, 1995, And 1994
Note 1. Summary Of Significant Accounting Policies
Background
Database Technologies,Inc.("the Company") was incorporated under the
laws of the State of Delaware on November 4, 1988. The Company operates
a computerized database containing current prices of certain electronic
merchandise from various vendors. The Company provides this information
to assist insurance company adjusters in processing claims. The Company's
principal source of revenue is licensing fees obtained from various
insurance companies for the use of the database.
Depreciation And Amortization
Property And Equipment:Property and equipment are recorded at cost.
Depreciation and amortization are computed on the straight line method
over the following estimated useful lives:
Asset Years
----- -----
Equipment, Furniture And
Fixtures 5
Cost of maintenance and repairs are charged to expense while costs of
significant renewals and betterments are capitalized.
Organization Costs
Organization costs are being amortized on a straight line method over a
period of five years. There was no expense for 1996,1995, and 1994.
Income Taxes
Income from operations and the related provisions for income taxes consist
of the following in 1996, 1995, and 1994.
1996 1995 1994
------ ------ -----
Income (Loss) From Operations $(50,992) $(36,149) $(13,325)
Provision For Income Taxes -0- -0- -0-
No provision for income taxes was required due to the accumulated losses
in the current and prior years. The Company has elected to carry any
accumulated losses forward.
Fiscal Year Year Carryforward Expires
----------- -------------------------
1990 2005
1991 2006
1993 2008
1994 2009
1995 2010
1996 2011
Notes to Financial Statements (Continued)
Income Taxes (continued)
In February 1992, the Financial Accounting Standards Board (FASB)
issued Statement 109, Accounting for Income Taxes (FASB No.109).Under
FASB 109, deferred taxes are based on temporary differences between
assets and liabilities for financial reporting purposes and for tax
purposes.Deferred taxes are measured using the enacted tax rates
expected to apply when the temporary differences are settled or
realized. SFAS No.109 has been adapted as of the beginning of the
Company's fiscal year ended April 30, 1994. Adoption of FASB 109 has
not had an impact on the Company's prior Financial Statements.
Pension and Profit Sharing Plans
The Company has established a profit sharing plan in fiscal year April
1993. The plan covers all employees of the Company.Benefits for the
plan are calculated based on a percentage of the employee's earnings.
For the fiscal year ended 1993 the funds assets were $8,479. No
contributions were made for the fiscal years ended 1994,1995 or 1996.
Allowance For Doubtful Accounts
Allowance for doubtful accounts are computed based on an individual
account basis.
2.Related Party Transactions
Affiliates
On January 1, 1995 the Company entered into a lease agreeement with the
Brighton Ave.Trust (see note 6). The trust is controlled by Allen S.
Wolfe.
Notes Payable-Shareholder
The notes payable to shareholder of $127,530 are unsecured and bear
interest at a rate of 14% per annum for those notes issued prior to
1990. Notes issued after 1990 bear interest at a rate of 12%.
1995 1994 1993
Notes Payable - Shareholder 127,530 67,746 47,347
Notes To Financial Statements (Continued)
3.Common Stock
The Company is authorized to issue two million five hundred thousand
(2,500,000)shares of common stock.The Par value of each share is $.001.
On July 7, 1989, the Company issued 2,281,192 shares of common stock at
par to the Pathfinder Data Group,Inc.'s shareholders of record as of
June 9, 1989. The financial statements of the Company reflect the
issuance of these shares as of April 30, 1989 as if the shares had been
issued at that date and not on the effective date of the issuance.The
retroactive treatment of the common stock issuance is not in accordance
with generally accepted accounting principles.
On July 7, 1990 the Company issued 100,000 shares of common stock at
$.01 per share for a total of $10,000. These shares were issued in
consideration for marketing services by an individual.
On August 30, 1993 the Company entered into an agreement with it's
former auditing firm,Sullivan,Bille & Co. in order to settle ongoing
litigation. Under this agreement, the Company will issue to Sullivan
& Bille & Co. 75,000 shares of it's common stock on or about October 5,
1993. These shares are not registered under the Securities Act of 1993
and are restricted as defined in Rule 144 under the Act. The shares may
not be offered for sale or transferred except pursuant to an effective
registration statement under the Act. These restrictions shall apply
for a period not to exceed two years from the date of issuance. In the
event Sullivan & Bille & Co. continues to own all or a portion of the
75,000 shares of stock on the day which is 2 years from the date of
issuance Allan S. Wolfe agrees that he will, upon the request of
Sullivan & Bille & Co. purchase these shares at a price of $.18 per
share.
4. Major Customer
The Company had no major customer who accounted for more than 10% of the
total revenue dduring the year ended April 30, 1996. There was no major
customer in the years 1994 or 1995.
5. Licensing and Marketing Agreements
On February 28, 1994, the Company entered into a licensing agreement
with ADP Property Claims Services,Inc. This agreement was to continue
in effect until December 31, 1998. However,on October 30,1995, ADP
terminated the contract with the Company. Under this Agreement, ADP
was to market the Company's database products along with and combined
with it's own products. The Companies are attempting to reach a new
agreement.
On December 13,1993, the Company entered into a marketing agreement with
David A. Johnson & Assoc.. This agreement will continue in effect until
December 12, 1998 and may be extended for an additional 5 years. Under
this agreement David A. Johnson & Assoc. will market the Company's
database products and combined with it's own products.
Notes To Financial Statements (Continued)
6.Commitments & Contingencies
Lease
On November 19, 1989, the Company entered into an agreement to lease
office space at $450 per month for a period of 24 months.This agreement
was then extended on a month to month basis.The lease agreement was
terminated by mutual consent of both parties as of December 31,1994.
The cost of this lease for the year ended April 30, 1995 was $3,600.
In January 1995 the Company entered into an agreement with the Brighton
Ave. Trust to rent new office space. The cost of this lease for the year
ended April 1995 was $2000 and $6,000 in 1996.
The Company leases an auto from Allan S. Wolfe. The Cost of this lease
for the year ended April 30, 1995 and 1996 was $5,400 in each year.
Litigation
On September 30, 1993 the Company settled a lawsuit brought against it
by it's former auditors, Sullivan,Bille & Co. for certain unpaid
professional fees. The settlement resulted in the Company paying
Sullivan,Bille & Co. $12,000 in cash and the issuance of 75,000
restricted share of stock (see note #3).
7.Income (Loss) Per Share
The loss per common share for the year ended April 30, 1996 has been
computed based on the weighted average number of shares outstanding of
2,491,082.
DATABASE TECHNOLOGIES,INC.
FORM 10-Q OCTOBER 31, 1996
PART I: FINANCIAL INFORMATION
ITEM 2- Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Revenues
The Registrant's revenues for the second quarter ended October 31,
1996 were $27,891 which reflects a decrease of almost $21,000
over the $48,721 in revenues for the same quarter ended October 31,
1995. For the six month period ended October 31, 1996 the revenues
were $46,066 and is a decrease of $47,000 from the prior six month
period ended October 31, 1995 in which the revenues were $93,182.
This decrease in revenues reflects the loss of clients of the
Registrant in the past six months over the same period of the prior
year. The cost of revenue for the quarter ended October 31, 1996
was a lower percentage of revenue, 38& than in the previous quarter
ended October 31, 1995 in which the cost of revenue percentage was
50% of the revenue. For the six months ended October 31, 1996 the
cost of revenue was 30 % in contrast to the cost of revenue for the
six months ended October 31, 1995 which was 47 % of the revenue.
Income Tax
The Registrant has not made provisions for Federal corporate
income taxes because of its tax loss carryforward.
Liquidity and Capital Resources
The Registrant is of the opinion increased revenues will not be
generated until the first quarter of the 1997 fiscal period when
the new marketing efforts and sales calls for its systems may
take effect. The Registrant continues research and development
on both a Windows system and an internet product but with the
limited financial resources of the Registrant the roll-out has
taken longer than anticipated and is not expected to be released
until mid 1997.
The Registrant is of the opinion that even with the reduction in
revenues currently being realized, cash flow will be sufficient
to maintain the daily level of operations. Debt reduction has
been suspended and all cash generated through revenues has been
augmented through loans from the Chairman and CEO for use in the
daily operation of the business. Management is of the opinion
the infusion of loans from the Chairman will be sufficient to
allow the Registrant to maintain operation at an acceptable rate
until increased revenues can be generated.
DATABASE TECHNOLOGIES,INC.
FORM 10-Q OCTOBER 31, 1996
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 Matter to a Vote of Security Holders
None
ITEM 5 - Other Information
Not Applicable
ITEM 6 - Exhibits and Reports on Form 8-K
a. Exhibits
None
b. Reports on Form 8-K (all incorporated by reference)
None
DATABASE TECHNOLGIES,INC.
FORM 10-Q OCTOBER 3, 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.
DATABASE TECHNOLOGIES,INC.
(Registrant)
December 6, 1996 Allan S. Wolfe
(Date) (Signature)
Allan S. Wolfe
Chairman of the Board,
President, Chief Executive
Officer, Chief Financial
Officer, and a Director