-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JVA05too1nQacuSXOVrQwIF7+hRd1+RSkj84LbvLe+LEw7eUqS3vzukPTulNldnw ipIjOMEHP9Ya4fjziYsArg== 0000789318-00-000004.txt : 20000307 0000789318-00-000004.hdr.sgml : 20000307 ACCESSION NUMBER: 0000789318-00-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000222 DATE AS OF CHANGE: 20000301 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CLANCY SYSTEMS INTERNATIONAL INC /CO/ CENTRAL INDEX KEY: 0000789318 STANDARD INDUSTRIAL CLASSIFICATION: 7372 IRS NUMBER: 841027964 STATE OF INCORPORATION: CO FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 033-04882-D FILM NUMBER: 550896 BUSINESS ADDRESS: STREET 1: 2250 S ONEIDA STREET 2: STE 308 CITY: DENVER STATE: CO ZIP: 80224 BUSINESS PHONE: 3037530197 MAIL ADDRESS: STREET 1: 2250 S ONEIDA STREET 2: STE 3308 CITY: DENVER STATE: CO ZIP: 80224 FORMER COMPANY: FORMER CONFORMED NAME: OXFORD FINANCIAL INC DATE OF NAME CHANGE: 19600201 10QSB 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 1999 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 33-4882-D CLANCY SYSTEMS INTERNATIONAL, INC. (Exact name of Registrant as specified in its charter) Colorado 84-1027964 (State or other jurisdiction of (IRS Employer Identification incorporation or organization) Number) 2250 S. Oneida #308, Denver, Colorado 80224 (Address of principal executive offices and Zip Code) (303) 753-0197 (Registrant's telephone number) N/A (Former name, former address and former fiscal year, if changed since last report) 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: Yes X No APPLICABLE ONLY TO CORPORATE ISSUERS: The number of shares outstanding of the issuer's classes of common stock, as of February 22, 2000 is 336,889,149 shares, $.0001 par value. CLANCY SYSTEMS INTERNATIONAL, INC. INDEX Page No. PART I. FINANCIAL INFORMATION Balance Sheet - September 30, 1999 and December 31, 1999 (unaudited) 2 and 3 Income Statement - For the Three Months Ended December 31, 1998 and 1999 (unaudited) 4 Statement of Stockholders' Equity - For the Three Months Ended December 31, 1999 (unaudited) 5 Statement of Cash Flows - For the Three Months Ended December 31, 1998 and 1999 (unaudited) 6 Notes to Unaudited Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II. OTHER INFORMATION 9 1 CLANCY SYSTEMS INTERNATIONAL, INC. BALANCE SHEET September 30, 1999 and December 31, 1999 (Unaudited) ASSETS September December --------- -------- Current assets: Cash and cash equivalents $ 315,579 $ 234,857 Accounts receivable 277,155 297,312 Inventories (Note 2) 160,582 155,331 Prepaid expenses 9,167 6,416 ---------- ---------- Total current assets 762,483 693,916 Furniture and equipment, at cost: Office furniture and equipment 153,085 153,085 Equipment under service contracts 1,167,393 1,197,196 ---------- ---------- 1,320,478 1,350,281 Less accumulated depreciation 926,987 972,532 ---------- ---------- Net furniture and equipment 393,491 377,749 Other assets: Investment in partnership 435,535 441,535 Deposits and other 17,058 17,058 Software development costs 143,195 149,560 ---------- ---------- Total other assets 595,788 608,153 ---------- ---------- $1,751,762 $1,679,818 ========== ========== See accompanying notes. 2 CLANCY SYSTEMS INTERNATIONAL, INC. BALANCE SHEET September 30, 1999 and December 31, 1999 (Unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY September December ---------- ---------- Current liabilities: Notes payable - related party (Note 4) $ 120,000 $ 65,000 Note payable - bank (Note 4) 240,000 200,000 Accounts payable 12,537 1,293 Income taxes payable 7,300 16,150 Deferred revenue 97,765 111,384 ---------- ---------- Total current liabilities 477,602 393,827 Deferred tax liability (Note 3) 6,000 4,650 Stockholders' equity (Note 5): Preferred stock, $.0001 par value; 100,000,000 shares authorized, none issued - - Common stock, $.0001 par value; 800,000,000 shares authorized, 336,889,149 shares issued and outstanding 33,689 33,689 Additional paid-in capital 1,030,674 1,030,674 Retained earnings 203,797 216,978 ---------- ---------- Total stockholders' equity 1,268,160 1,281,341 ---------- ---------- $1,751,762 $1,679,818 ========== ========== See accompanying notes. 3 CLANCY SYSTEMS INTERNATIONAL, INC. INCOME STATEMENT For the Three Months Ended December 31, 1998 and 1999 (Unaudited) 1998 1999 ---- ---- Revenues: Sales $ 102,564 $ 15,806 Service contract income 281,410 319,786 Parking ticket collections 84,242 45,403 ---------- ---------- Total revenues 468,216 380,995 Costs and expenses: Cost of sales 16,475 22,955 Cost of services 142,807 132,334 Cost of parking ticket collections 87,938 31,867 General and administrative 137,318 160,751 Research and development 12,046 11,927 ---------- ---------- Total costs and expenses 396,584 359,834 ---------- ---------- Income from operations 71,632 21,161 Other income (expense); Interest income 593 408 Interest expense (6,828) (6,888) ---------- ---------- Total other income (expense) (6,235) (6,480) ---------- ---------- Income before provision for income taxes and gain (loss) in equity-basis partnership 65,397 14,681 Provision for income taxes 23,000 5,400 Gain (loss) in equity basis partnership (net of tax provision of $(4,500)-1998 and $2,100-1999) (8,880) 3,900 ---------- ---------- Net income $ 33,517 $ 13,181 ========== ========== Basic net income per common share $ * $ * ========== ========== Weighted average number of shares outstanding 336,900,000 336,900,000 =========== =========== See accompanying notes. 4 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF STOCKHOLDERS' EQUITY For the Three Months Ended December 31, 1999 (Unaudited)
Additional Common stock paid-in Retained Shares Amount capital earnings ------ ------ ---------- -------- Balance, September 30, 1999 336,889,149 $33,689 $1,030,674 $203,797 Net income for the three months ended December 31, 1999 - - - 13,181 ----------- ------- ---------- -------- Balance, December 31, 1999 336,889,149 $33,689 $1,030,674 $216,978 =========== ======= ========== ========
See accompanying notes. 5 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF CASH FLOWS For the Three Months Ended December 31, 1998 and 1999 (Unaudited) 1998 1999 ---- ---- Cash flows from operating activities: Net income $33,517 $ 13,181 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 68,344 60,846 Deferred income tax (benefit) expense 2,500 (1,350) Increase in accounts receivable (86,883) (20,157) Decrease (increase) in inventories (10,736) 5,251 Decrease in prepaid expenses - 2,751 Loss (gain) in equity basis partnership 13,380 (6,000) Decrease in accounts payable (37,999) (11,244) Decrease in income taxes refundable 16,000 - Increase in income taxes payable - 8,850 Increase in deferred revenue 42,028 13,619 ------- -------- Total adjustments 6,634 52,566 ------- -------- Net cash provided by operating activities 40,151 65,747 Cash flows from investing activities: Acquisition of furniture and equipment - net (30,923) (29,803) Increase in software development costs (8,450) (21,666) Investment in partnership (55,000) - ------- -------- Net cash used in investing activities (94,373) (51,469) Cash flows from financing activities: Payments on note payable - bank (40,000) Proceeds from note payable - related party 55,000 - Payments on note payable - related party - (55,000) ------- -------- Net cash provided by (used in) financing activities 55,000 (95,000) ------- -------- Increase (decrease) in cash and cash equivalents 778 (80,722) Cash and cash equivalents at beginning of period 91,432 315,579 ------- -------- Cash and cash equivalents at end of period $92,210 $234,857 ======= ======== See accompanying notes. 6 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS December 31, 1999 1. Basis of presentation The accompanying financial statements have been prepared by the Company, without audit. In the opinion of management, the accompanying unaudited financial statements contain all adjustments (consisting of only normal recurring accruals) necessary for a fair presentation of the financial position as of September 30, 1999 and December 31, 1999, and the results of operations and cash flows for the periods ended December 31, 1998 and 1999. 2. Inventories Inventories consist of the following at: September 30, December 31, 1999 1999 ---- ---- Finished goods $ 7,160 $ 7,767 Work in process 1,052 15,533 Purchased parts and supplies 152,370 132,031 -------- -------- $160,582 $155,331 ======== ======== 3. Income taxes The provision for income taxes for the three months ended December 31, 1998 and 1999 is based on the expected tax rate for the year. As of September 30, 1999 and December 31, 1999, total deferred tax assets and liabilities are as follows: September 30, December 31, 1999 1999 ---- ---- Deferred tax assets $60,000 $ 56,100 Deferred tax liabilities (66,000) (60,750) ------- -------- $(6,000) $ (4,650) ======= ======== 4. Notes payable Related party: During the year ended September 30, 1999, the Company executed five notes payable from a major shareholder of the Company for a total of $120,000. The notes bear interest at 8 and 9% annually, and mature through February 29, 2000. The notes will be extended by mutual consent of the parties. The remaining balance at December 31, 1999 is $65,000. 7 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS December 31, 1999 4. Notes payable (continued) Bank: In October 1999, the Company extended the due date of its note payable - bank to October 15,2000. The note bears interest at 9%, with interest payable monthly and is secured by a certificate of deposit in the name of two officers of the Company. 5. Letters of intent In November 1999, the Company entered into a letter of intent to sell 158,000,000 shares of its common stock to an unrelated company, in exchange for $570,000 in cash. Also in November 1999, the Company entered into a letter of intent to acquire two website related businesses owned and developed by the Company's president and major shareholder for 80,703,013 shares of the Company's common stock. The businesses will be recorded by the Company at the president's historical cost basis in those assets. Both transactions are expected to be consummated in February 2000. 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Material Changes in Financial Condition At December 31, 1999, the Company had working capital of $300,089 derived primarily from contract sales, as compared to working capital of $284,881 at September 30, 1999. The Company anticipates that working capital will be sufficient to meet its working capital requirements for the current year. Funds will continue to be used for general and administrative purposes, equipment purchases, equipment manufacturing, travel, marketing and research and development. Material Changes in Results of Operations During the quarter ended December 31, 1999, the Company generated revenues from contract sales from its professional services contracts, sales, and privatization contracts. Berkeley, CA and Oklahoma City, OK each generated revenues in excess of 5% of total revenues. Revenues during the quarter were lower than the prior year's quarter by 19% which is primarily due to the completion of the Maywood ticket issuance contract which was completed as of September 30, 1999. Expenses decreased by 11% under the prior year's quarter due to elimination of expenses related to the Maywood contract. The Company reported a profit of $13,181 for the 1999 quarter as compared to a net profit of $33,517 for the prior year's quarter. Forward Looking Information Statements of the Company's or management's intentions, beliefs, anticipations, expectations and similar expressions concerning future events contained in this document constitute "forward looking statements" as defined in the Private Securities Litigation Reform Act of 1995. As with any future event, there can be no assurance that the events described in the forward looking statements made in this report will occur or that the results of future events will not vary materially from those described in the forward looking statements in this document. Important factors that could cause the Company's actual performance and operating results to differ materially from the forward looking statements include, but are not limited to, (i) the ability of the Company to obtain new customers, (ii) the ability of the Company to obtain sufficient financing for business opportunities, (iii) the ability of the Company to reduce costs and thereby maintain adequate profit margins. Chat Room Disclaimer This new forum of exposure to publicly traded companies presents a venue for the public to inquire about companies from other individuals as well as post opinions. The Company has no way to regulate postings nor monitor information disclosed on these boards. 9 Management can only provide information to shareholders and potential shareholders when contacted directly and such information can only be provided when it is based on fact and has been filed as required by law with the Securities and Exchange Commission and other regulatory agencies. PART II - OTHER INFORMATION Item 1. Legal Proceedings The District Court, City and County of Denver, State of Colorado granted a motion to dismiss in the case filed against Stanley J. Wolfson, Lizabeth M. Wolfson, Mark G. Lawrence and Clancy Systems International, Inc. filed by Lorraine E. Salazar, Francis Salazar, Barry Fey and Philip B. Davis. The order states that the Plaintiffs fail to state a claim upon which relief can be granted. Further, the court granted defendants reimbursement for attorney's fees and costs. Item 2. Changes In Securities and Use of Proceeds In November 1999, the Company entered into a letter of intent with Jubilee Community LLC (an unrelated Company) to sell 158,000,000 shares of its common stock in exchange for $570,000 in cash. This transaction is exempt from registration under Section 4(2) of the Securities Act of 1933. Also in November 1999, the Company entered into a letter of intent to acquire two website related businesses owned and developed by Stanley J. Wolfson, the Company's president and major shareholder for 80,703,013 shares of the Company's common stock. The businesses will be recorded by the Company at the president's historical cost basis in those assets. This transaction is exempt from registration under Section 4(2) of the Securities Act of 1933. Both transactions are expected to be consummated in February 2000. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 27.1 Financial Data Schedule (1) (b) During the quarter ended December 31, 1999, the Registrant has filed no reports on Form 8-K (1) Filed herewith 10 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. Date: February 22, 2000 CLANCY SYSTEMS INTERNATIONAL, INC. (Registrant) By: /s/ Stanley J. Wolfson Stanley J. Wolfson, President and Chief Executive Officer By: /s/ Lizabeth M. Wolfson Lizabeth M. Wolfson, Secretary- Treasurer and Chief Financial and Chief Accounting Officer 11 EX-27 2 FDS1299
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-QSB STATEMENTS FOR PERIOD ENDED 12/31/99 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH 10-QSB FOR PERIOD ENDED 12/31/99 3-MOS SEP-30-2000 DEC-31-1999 234,857 0 297,312 0 155,331 693,916 1,350,281 972,532 1,679,818 393,827 0 0 0 33,689 1,247,652 1,679,818 15,806 380,995 22,955 187,156 172,678 0 6,888 14,681 0 0 0 0 0 13,181 0 0
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