SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-----------------------------------
FORM 10-Q SB-A
AMENDED
/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996 COMMISSION FILE NO. 2-91651-D
PEACOCK FINANCIAL
CORPORATION
COLORADO 87-0410039
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1600 EAST FLORIDA AVENUE
SUITE 306
HEMET, CA 92544
(ADDRESS AND ZIP CODE OF PRINCIPAL EXECUTIVE OFFICES)
(909) 925-6469
(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
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
COMMON STOCK 9,942,700 SHARES OUTSTANDING
$0.001 PAR VALUE AS OF JUNE 30, 1996
PEACOCK FINANCIAL CORPORATION
REPORT ON FORM 10-Q
QUARTER ENDED JUNE 30, 1996
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
- CONDENSED CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 1996, AND
DECEMBER 31, 1995
- CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1996, AND 1995
- CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
EQUITY AS OF JUNE 30, 1996
- CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AS OF JUNE 30,
1996
- NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
PART II. OTHER INFORMATION AND SIGNATURES
2
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
JUNE 30, 1996 DEC 31, 1995
(unaudited) (unaudited)
------------- ------------
Current assets:
Cash and cash equivalents $24,311 $123,544
Restricted cash 0 144,049
Accounts Receivable - related parties 42,435 42,165
Accounts Receivable 415,000 0
Notes Receivable net of allowance
for bad debt 940 940
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Total Current Assets 482,686 310,698
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Fixed Assets
Rental property, at cost, net of accumulated
depreciation 8,302,269 8,238,151
of $721,243 and $635,468 respectively
Homebuilding and Development 697,531 0
Furniture and fixture, at cost, net of accumulated
depreciation of $145,453 and $144,261 respectively 29,675 33,324
------------- ------------
Net Fixed Assets 9,029,475 8,271,475
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Other assets
Notes Receivable - related parties 121,530 65,426
Notes Receivable - shareholders 60,000 0
Intangible development costs 1,221,499 1,216,435
Investments in limited partnerships 0 0
Deferred charges 54,910 44,298
Prepaid salary 211,358 208,358
Other assets 72,233 38,179
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Total Other Assets 1,741,530 1,572,696
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Total Assets $11,253,691 $10,154,869
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The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
LIABILITIES AND EQUITY
JUNE 30, 1996 DEC 31, 1995
(unaudited) (audited)
-------------- -------------
Current liabilities:
Accounts Payable - Administrative $144,748 $114,395
Other Current Liabilities - Administrative 76,775 87,027
Lines of Credit 69,178 73,295
Note payable to Stockholder 16,857 16,857
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Current Liabilities - Administrative 307,558 291,574
-------------- -------------
Accounts Payable - Rental Properties 347,005 270,989
Accounts Payable - Homebuilding 51,238 $0
Other Current Liabilities - Rental Properties 221,669 176,137
Homebuilding Loans Payable 599,264 0
Notes payable - current portion 2,191,311 1,905,754
-------------- -------------
Current Liabilities - Rental and Homebuilding 3,410,487 2,352,880
-------------- -------------
Total Current Liabilities 3,718,045 2,644,454
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Long-term liabilities
Notes payable - Administration 406,794 470,468
Notes payable - Rental Properties 8,051,291 8,209,446
Less Current Portion of Long-Term Liabilities (2,191,311) (1,923,685)
-------------- -------------
Total Long-term Debt 6,266,774 6,395,127
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Total Liabilities 9,984,819 9,039,581
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COMMITMENTS AND CONTINGENCIES 0 0
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STOCKHOLDERS' EQUITY
Common stock, 250,000,000 and Class A Preferred 10,000,000
authorized, par value $.001 and $.01; 9,942,700 Common
and 672,300 Class A Preferred issued 10,615 3,256
Additional paid-in capital 2,421,496 2,326,899
Accumulated deficit (1,163,239) (1,214,867)
-------------- -------------
Total Stockholders' Equity 1,268,872 1,115,288
-------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $11,253,691 $10,154,869
-------------- -------------
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The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, THREE MONTHS ENDED JUNE 30,
1996 1995 1996 1995
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues:
Rental income $714,873 $594,989 $352,604 $296,873
Property management income 83,684 200,611 8,130 89,662
Homebuilding administration income 54,360 0 54,360 0
Homebuilding income 422,127 0 422,127 0
Administrative income 750 0 750 0
Commissions income 26,823 29,065 618 29,065
Other income 437,075 9,130 422,268 (1,374)
----------- ----------- ----------- -----------
Total Revenues 1,739,692 833,795 1,260,857 414,226
----------- ----------- ----------- -----------
Expenses
Depreciation and amortization 191,805 160,813 104,838 79,242
General and administrative 340,890 273,961 180,355 156,669
Homebuilding Costs 422,127 0 422,127 0
Property operation and administration 361,897 316,714 177,758 171,892
----------- ----------- ----------- -----------
Total Expenses 1,316,719 751,488 885,078 407,803
----------- ----------- ----------- -----------
Income (loss) from operations 422,973 82,307 375,779 6,423
----------- ----------- ----------- -----------
Other income (expense)
Interest income 1,799 597 563 597
Interest expense (372,847) (263,000) (206,703) (82,080)
----------- ----------- ----------- -----------
Total Other Income (Expense) (371,048) (262,403) (206,140) (81,483)
----------- ----------- ----------- -----------
Income (loss) before taxes 51,925 (180,096) 169,639 (75,060)
Income Taxes (800) (800) (800) (800)
----------- ----------- ----------- -----------
Net income (loss) $51,125 ($180,896) $168,839 ($75,860)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Net income (loss) per share $0.01 ($0.02) $0.02 ($0.02)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
Additional
Common Stock Paid-in Accumulated
--------------------------
Shares Amount Capital Deficit
-------------------------- ---------- -----------
Balance, March 31, 1995 $3,186,150 $3,186 $2,241,455 ($667,582)
Class A stock issued for services 20,000 20 19,980 -
Class B stock issued for cash 50,000 50 99,950 -
Accrued dividends - - (34,486) -
Net income (loss) for the period from
April 1, 1995 through December 31, 1995 - - - (547,285)
----------- ------- ---------- ----------
Balance, December 31, 1995 3,256,150 3,256 2,326,899 (1,214,867)
(unaudited)
Class A stock turned in at time of merger (2,920,000) (2,920) 2,920
Common Stock issued at merger (restricted) 8,867,700 8,868 (83,088)
Common Stock issued at merger (unrestricted) 1,075,000 1,075 (1,075)
Class B stock turned in at time of merger (336,150) (336) 336
Class A Preferred Stock issued at merger (restricted) 672,300 672 (672)
Net income (loss) for the period from
January 1, 1996 through June 30, 1996 51,628
----------- ------- ---------- ----------
Balance at June 30, 1996 10,615,000 $10,615 $2,421,496 ($1,163,239)
----------- ------- ---------- ----------
----------- ------- ---------- ----------
The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1996 1995 1996 1995
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $51,628 ($180,896) $169,342 ($75,860)
Adjustments to reconcile net earnings to net - - - -
cash provided by (used in) operating activities - - - -
Depreciation and amortization 191,805 160,813 104,838 79,242
Stock issued for Services - - - -
Changes in operating assets and liabilities - - - -
(Increase) decrease in restricted cash 144,049 - - -
Decrease (increase) in accounts and notes
receivable (415,000) 161,431 (428,868) 170,057
Decrease (increase) in accounts
receivable - related parties (270) (51,059) - -
Decrease (increase) in other assets (168,834) (150,459) (496,881) (138,433)
Increase (decrease) in accounts payable 157,607 (3,016) 112,857 9,726
Increase (decrease) in other liabilities 35,280 (58,337) 29,013 (68,527)
Increase (decrease) in Homebuilding Loans 599,264 - 599,264 -
----------- ----------- ----------- -----------
Net cash provided (used) by
Operating activities 595,529 (121,523) 89,565 (23,795)
----------- ----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment (949,805) (1,099,726) (84,711) (1,089,091)
----------- ----------- ----------- -----------
Net cash provided (used) by
investing activities (949,805) (1,099,726) (84,711) (1,089,091)
----------- ----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of notes payable 116,877 (12,803) (43,645) -
Proceeds from long-term borrowings 36,210 1,339,495 0 1,125,207
Proceeds from stock offerings 101,956 5,000 (5,792) (2,000)
----------- ----------- ----------- -----------
Net cash provided (used) by
financing activities $255,043 $1,331,692 ($49,437) $1,123,207
----------- ----------- ----------- -----------
The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30 JUNE 30 JUNE 30, JUNE 30,
1996 1995 1996 1995
(unaudited) (unaudited) (unaudited) (unaudited)
----------- ----------- ----------- -----------
NET INCREASE IN CASH ($99,233) $112,443 ($44,583) $10,321
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR 123,544 6,796 68,894 108,918
----------- ----------- ----------- -----------
CASH AND CASH EQUIVALENTS AT END
OF YEAR $24,311 $119,239 $24,311 $119,239
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
SUPPLEMENTAL DISCLOSURE OF
NON-CASH ACTIVITIES
Common Stock issued for Notes Receivable $110,000 - - -
Common Stock issued for debt - - 7,000 -
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION
Interest paid, net of amount capitalized $323,462 $274,531 $188,338 $141,275
Income taxes paid - - - -
The accompanying notes are an integral part of these financial statements.
PEACOCK FINANCIAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED STATEMENTS
QUARTER ENDED JUNE 30, 1996
NOTE 1: BASIS OF PRESENTATION
GENERAL
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q. Therefore, they do not include
all information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows, and stockholders' equity in
conformity with generally accepted accounting principles. The Company (formerly
known as Connectivity and Technologies, Inc.), was formed on February 16, 1984.
Except as disclosed herein, there has been no material change in the information
disclosed in the notes to the financial statements included in the Company's
Form 8-K filed on February 8, 1996. In the opinion of Management, all
adjustments considered necessary for a fair presentation of the results of
operations and financial position have been included and all such adjustments
are of a normal recurring nature. Operating results for the quarter ended June
30, 1996, are not necessarily indicative of the results that can be expected for
the year ended December 31, 1996.
NOTE 2: STOCK SPLIT
At the Company's stockholder's meeting held on February 27, 1996, the
stockholders approved a two hundred (200) share for one (1) share reverse split
of the outstanding common shares from 215,000,000 to 1,075,000.
NOTE 3: REORGANIZATION
On March 27, 1996, an Acquisition Agreement and Plan of Reorganization,
dated February 27, 1996, was signed by and between the Company and Peacock
Financial Corporation ("Peacock") pursuant to which the Company acquired 100% of
the assets of Peacock, subject to liabilities, in exchange for 7,767,702 shares
of the Company's $.001 par value common stock, constituting 78% of the 8,842,702
common shares of the Company outstanding after the transaction; and 672,300 par
value $.01 preferred shares of the Company. A true and correct copy of the
Acquisition Agreement and Plan of Reorganization is included in the Company's
Form 8-K filed on February 8, 1996.
9
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.
PEACOCK FINANCIAL CORPORATION
Signed
/s/ Steven R. Peacock
- ------------- --------------------------------------
Date Steven R. Peacock
President and Chief Executive Officer
Signed
/s/ Jo-Ann King
- ------------- --------------------------------------
Date Jo-Ann King
Secretary/Treasurer
10