-----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, Bux5gPFj0oegrGZYBrjWgCI7BJvO08pgCAxg25cZGQuTbWcruWsYZFa1ghWZSNty kY4vLd07b6ounrhLspaCYw== 0000950131-99-003110.txt : 19990517 0000950131-99-003110.hdr.sgml : 19990517 ACCESSION NUMBER: 0000950131-99-003110 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990514 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IFX CORP CENTRAL INDEX KEY: 0000792861 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES & SERVICES [6200] IRS NUMBER: 363399452 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-15187 FILM NUMBER: 99621921 BUSINESS ADDRESS: STREET 1: 200 W ADAMS ST STREET 2: STE 1460 CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3124199530 MAIL ADDRESS: STREET 1: 200 WEST ADAMS ST STE 1460 CITY: CHICAGO STATE: IL ZIP: 60606 FORMER COMPANY: FORMER CONFORMED NAME: CARL JACK 312 FUTURES INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: 312 FUTURES INC DATE OF NAME CHANGE: 19860916 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to _________________ Commission File # 0-15187 IFX Corporation - ------------------------------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 36-3399452 - ------------------------------------------------------------------------------ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 200 West Adams Street, Suite 1460, Chicago, Illinois 60606 - ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip Code) (312) 419-9530 - ------------------------------------------------------------------------------ (Registrant's telephone number, including area code) - ------------------------------------------------------------------------------ (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. X Yes No --- --- As of the date of this report, the issuer had outstanding 6,762,307 shares of common stock, $.02 par value per share. 1 IFX CORPORATION AND SUBSIDIARIES Part I - Financial Information Item 1. Financial Statements Immediately following this page, the following financial information of the Registrant is filed as part of this Report. Page ---- Consolidated statements of financial condition as of March 31, 1999 and June 30, 1998. 3 Consolidated statements of operations for the three months and nine months ended March 31, 1999 and 1998. 4 Consolidated statements of cash flows for the nine months ended March 31, 1999 and 1998. 6 Notes to consolidated financial statements. 7 2 IFX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
ASSETS March 31, June 30, 1999 1998 ------------- ------------ (Unaudited) (Audited) Cash $ 312,800 $ 535,200 Short-term investments 50,204,500 36,068,800 Receivables: Brokers and dealers 5,288,500 4,573,100 Customers 1,085,400 1,646,800 Affiliates 57,500 54,600 Other 947,500 1,452,600 Less- Allowance for doubtful accounts (80,100) (358,900) ------------- ------------- 7,298,800 7,368,200 Investments in and advances to affiliated partnerships 350,000 134,200 Notes receivable 807,700 811,400 Furniture, equipment and leasehold improvements, net of accumulated depreciation and amortization of $447,000 and $298,800, at March 31, 1999 and June 30, 1998, respectively. 505,200 143,000 Other assets 626,100 293,100 ------------- ------------- Total $ 60,105,100 $ 45,353,900 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Payables: Brokers and dealers $ 1,162,800 $ 863,100 Customers and counterparties 40,340,700 29,632,900 Affiliates and employees 72,900 - Accounts payable and accrued expenses 1,931,300 1,601,200 ------------- ------------- Total payables 43,507,700 32,097,200 Minority interest 2,296,000 1,921,500 Stockholders' equity: Common stock, $.02 par value; 150,000,000 shares authorized, 6,655,539 and 6,155,539 issued and outstanding at March 31, 1999 and June 30, 1998, respectively. 133,100 123,100 Paid-in-capital and retained earnings 13,713,400 11,212,100 Stock purchase right 454,900 - ------------- ------------- Total stockholders' equity 14,301,400 11,335,200 ------------- ------------- Total $ 60,105,100 $ 45,353,900 ============= =============
The accompanying notes are an integral part of the consolidated financial statements. 3 IFX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended March 31, ------------------------- 1999 1998 ----------- ----------- Revenues: Commissions .............................. $ 129,300 $ 403,500 Interest ................................. 751,500 681,300 Trading gains, net ....................... 1,740,200 1,700,500 Earn-out from Sale of Assets ............. 825,400 995,800 Other .................................... 79,300 80,500 ----------- ----------- Total revenues ....................... 3,525,700 3,861,600 ----------- ----------- Expenses: Commission and brokerage ................. 122,500 307,900 Compensation and related benefits ........ 716,700 670,600 Communications ........................... 187,800 158,900 Interest ................................. 401,500 399,500 Rent and other occupancy ................. 157,300 225,500 Business promotion ....................... 140,400 161,100 Professional and consulting fees ......... 378,600 261,400 Depreciation ............................. 59,800 38,900 Other .................................... 237,300 115,800 ----------- ----------- Total expenses ....................... 2,401,900 2,339,600 ----------- ----------- Income before income taxes and minority interest 1,123,800 1,522,000 Income tax expense ............................. 350,100 515,400 ----------- ----------- Net income before minority interest ............ 773,700 1,006,600 Minority interest .............................. 279,700 241,900 ----------- ----------- Net income ..................................... $ 494,000 $ 764,700 =========== =========== Basic earnings per share: Net income ............................... $ .07 $ .12 =========== =========== Weighted average number of Common shares outstanding .............. 6,655,539 6,278,584 =========== =========== Diluted earnings per share: Net income ............................... $ .04 $ .12 =========== =========== Weighted average number of Common shares outstanding ........... 11,138,702 6,278,584 =========== ===========
The accompanying notes are an integral part of the consolidated financial statements. 4 IFX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Nine Months Ended March 31, ------------------------- 1999 1998 ----------- ----------- Revenues: Commissions .............................. $ 464,200 $ 835,600 Interest ................................. 1,957,200 2,397,100 Trading gains, net ....................... 4,674,300 5,245,200 Earn-out from Sale of Assets ............. 3,274,000 2,930,100 Other .................................... 43,400 90,900 ----------- ----------- Total revenues ....................... 10,413,100 11,498,900 ----------- ----------- Expenses: Commission and brokerage ................. 623,300 671,600 Compensation and related benefits ........ 2,124,100 1,771,900 Communications ........................... 528,800 537,600 Interest ................................. 1,097,100 1,511,300 Rent and other occupancy ................. 673,100 618,800 Business promotion ....................... 360,000 379,500 Professional and consulting fees ......... 779,400 763,900 Depreciation ............................. 148,200 136,000 Other .................................... 288,000 421,800 ----------- ----------- Total expenses ....................... 6,622,000 6,812,400 ----------- ----------- Income before income taxes and minority interest 3,791,100 4,686,500 Income tax expense ............................. 1,295,400 1,480,500 ----------- ----------- Net income before minority interest ............ 2,495,700 3,206,000 Minority interest .............................. 529,500 780,200 ----------- ----------- Net income ..................................... $ 1,966,200 $ 2,425,800 =========== =========== Basic earnings per share: Net income ............................... $ .31 $ .39 =========== =========== Weighted average number of common shares outstanding .............. 6,390,940 6,277,627 =========== =========== Diluted earnings per share: Net income ............................... $ .24 $ .39 =========== =========== Weighted average number of common shares outstanding .............. 8,246,946 6,277,627 =========== ===========
The accompanying notes are an integral part of the consolidated financial statements. 5 IFX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ended March 31, ---------------------------- 1999 1998 ------------ ------------ Cash flows from operating activities: Net income ................................................... $ 1,966,200 $ 2,425,800 Adjustments to reconcile net income to net cash provided by (used in ) operating activities: Depreciation ................................................. 148,200 136,000 Deferred taxes ............................................... (145,300) (6,000) Doubtful accounts expense .................................... 243,200 (7,600) Equity in net gain in partnership investments ................ (39,800) (7,800) Changes in: Short-term investments ....................................... (14,135,700) 8,554,400 Receivables .................................................. (199,000) (2,491,700) Other assets ................................................. (333,000) 107,100 Payables ..................................................... 11,105,400 (8,648,800) Accounts payable and accrued expenses ........................ 475,600 (1,627,000) ------------ ------------ Cash provided by (used in) operating activities ............ (914,200) (1,565,600) ------------ ------------ Cash flows from investing activities: Decrease (increase) in notes receivable ...................... 3,700 (194,500) Purchase of furniture, equipment and leasehold Improvements ............................................... (510,400) (41,000) Investments in/advances to affiliated partnerships ........... (176,000) (14,000) ------------ ------------ Cash provided by (used in) investing activities ............ (682,700) (249,500) ------------ ------------ Cash flows from financing activities: Repayment of notes payable ................................... -- (1,586,600) Minority interest ............................................ 374,500 676,200 Issuance (repurchase) of common stock and stock purchase right 1,000,000 (7,100) ------------ ------------ Cash provided by (used in) financing activities ............ 1,374,500 (917,500) ------------ ------------ Increase (decrease) in cash ........................................ (222,400) (2,732,600) Cash, beginning of period .......................................... 535,200 3,279,300 ------------ ------------ Cash, end of period ................................................ $ 312,800 $ 546,700 ============ ============
The accompanying notes are an integral part of the consolidated financial statements. 6 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Basis of Presentation - --------------------- The consolidated financial statements of IFX Corporation include the accounts of IFX Corporation (formerly Jack Carl/312-Futures, Inc., "JC/312") and subsidiaries (collectively, the "Company" or "IFX"). All material intercompany accounts and transactions have been eliminated in consolidation. Until July 1, 1996, the Company engaged principally in the business of effecting transactions in futures and options on futures contracts for the accounts of customers and the operation of commodity pools. FX Chicago, Inc., (formerly Index Futures Group, Inc., or "Index"), until July 1, 1996, was the principal operating subsidiary of JC/312. Effective July 1, 1996, Index sold, transferred and assigned substantially all of its brokerage accounts ("Sale of Assets") to E.D. & F. Man International Inc. ("MINC"). Index ceased being a registered futures commission merchant with the Commodity Futures Trading Commission ("CFTC") in December, 1996. As a condition of the Sale of Assets, Index changed its name to FX Chicago, Inc. IFX, Ltd. (formerly Index FX, Ltd.), a British corporation and a majority owned subsidiary of IFX Corporation, continues to conduct foreign exchange business as a registrant of the British Securities and Futures Authority. Following the Sale of Assets, the Company decided not to reinvest the sales proceeds in its commodities brokerage business and has been exploring other industries and business opportunities. Based on its research, the Company has determined that the Internet and telecommunications industries present the greatest opportunities for the Company's future investment and growth, though the risks associated with these lines of business are extremely high. Accordingly, the Company has recently begun to pursue the development of Internet services and the acquisition of Internet service providers ("ISPs") in South America and Mexico in addition to acquiring an interest in a telecommunication business with the proceeds from the Sale of Assets and private equity offerings. In November 1998, the Company entered into an agreement with International Technology Investments, LC ("International Technology") to jointly acquire Internet services and make investments in Internet-related businesses in Latin America and other international markets. The Company is presently in the process of developing and acquiring ISP related businesses. Expenses incurred by these new entities are included in the Consolidated Statements of Operations for the three and nine months ended March 31, 1999. In March 1999, the Company formed, through wholly owned subsidiaries, companies in Costa Rica, Argentina and Columbia. On March 23, 1999, the Argentinean company was granted a license from the government of Argentina to offer full value added telecommunications services and data transmission throughout the country. The companies in Costa Rica and Columbia are seeking similar licenses. 7 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) In December 1998, the Company, through a wholly owned subsidiary, acquired a 25% limited partnership interest in Telcom.Net, L.P., a domestic telecommunications and Internet software development company that was co-founded in 1997 by Joel M. Eidelstein, the Company's President. The limited partnership interest entitles the Company to receive priority distributions of up to $200,000, the amount of the Company's invested capital, and after all of its other partners have received priority distributions equal to their aggregate invested capital, 25% of the profits of Telcom.Net, L.P. This investment is recorded in Investments in and advances to affiliated partnerships in the Company's Consolidated Statements of Financial Condition. These consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been reflected in these condensed consolidated financial statements. Operating results for the quarter and the nine months ended March 31, 1999 are not necessarily indicative of the results that may be expected for the year ending June 30, 1999. Certain reclassifications have been made in the 1998 financial statements to conform to the fiscal 1999 presentation. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's financial statements on Form 10-K for the year ended June 30, 1998. Commitments and Contingencies - ----------------------------- Litigation- - ----------- The Company is a defendant in, and may be threatened with, various legal proceedings arising from its regular business activities. Management, after consultation with legal counsel, is of the opinion that the ultimate liability, if any, resulting from any pending action or proceedings will not have a material effect on the financial position or results of operations of the Company. On May 16, 1996, Index filed suit in the Circuit Court of Cook County--Law Division against Doug Niemann, a former customer, for breach of contract, seeking to recover a debit balance of $88,200 (Index Futures Group, Inc. v. Doug Niemann, case no. 96L-5506). On January 14, 1997, Niemann filed a counterclaim for $688,200. The Company believes that the counterclaim is without merit and will defend vigorously. 8 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) In April 1994, Index, without admitting or denying the allegations, paid $100,000 to the CFTC, settling an administrative action filed on September 29, 1992. In a related action, the equity receiver of a commodity pool operator brought an action to recover losses of approximately $600,000, alleging various theories such as constructive trust, negligence, breach of fiduciary duty and conversion. On May 29, 1996, the district judge dismissed the complaint in its entirety. On December 4, 1997, the Court of Appeals affirmed the district judge's dismissal of all claims against Index. On January 13, 1998, the Court of Appeals denied the Supplemental Plaintiffs' request for a rehearing of its appeal. On October 2, 1998, the attorney for the equity receiver of the commodity pool filed a class-action suit on behalf of a putative class composed of persons who had given money to the commodity pool operator to invest, some of which was deposited in brokerage accounts at Index by the commodity pool operator. (Wesselhoff v. FX Chicago, Inc. et al., Circuit Court of Cook County, Chancery Division, case number 98-CH-13396). The plaintiff seeks damages of $600,000 plus prejudgment interest, punitive damages, and lost investment opportunity. The Company believes that the allegations in the complaint against FX Chicago, Inc. and the Company are without merit and will defend vigorously. A German citizen, seeking damages of 6,403,519.19 Deutschmark (approximately $4,000,000 given the exchange rate as of September 15, 1998), filed a lawsuit in September 1998, in Germany, against an affiliate of MINC. The complaint arises out of transactions that occurred in an account introduced by Index Futures Group, AG ("Index AG"), an introducing broker of Index, prior to the Sale of Assets. The Plaintiff alleges that under German law, MINC's affiliate is successor to Index AG, and thus assumed any liabilities of Index AG. Pursuant to the Sale of Assets agreement, Index is responsible for any liability "arising out of any state of facts with respect to such Assigned Contract existing on or prior to the Closing Date". MINC has retained counsel in Germany to represent its interests in this matter. As Index AG was an introducing broker of Index and not a former subsidiary of the Company or Index, the Company does not believe that it will ultimately be liable for damages. The Company had requested but has not received regular updates from MINC, and, accordingly, the Company does not have information as to the extent of any potential liability under the suit nor legal costs required to defend such suit, at the present time. On October 27, 1998, a complaint was filed by James Feltman as liquidating agent of L. Luria & Son, Inc. (Case No. 97-16731-BKC-RAM) seeking recovery from the Company of $368,188.84. Starting in the winter of 1996, the Company entered into an arrangement with the suppliers of L. Luria & Son, Inc. pursuant to which the Company advanced funds on behalf of L. Luria & Son, Inc. in order to allow it to purchase inventory. L. Luria & Son, Inc. reimbursed the Company for amounts that it had advanced. The complaint alleges that the Company was an insider of L. Luria & Son, Inc. because of Joel Eidelstein's relationship to L. Luria & Son, Inc. and that the amounts that L. Luria & Son, Inc. paid the Company constituted preferences under the Bankruptcy laws. On March 1, 1999, the Company reached an agreement to settle this complaint for $92,222. 9 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) On December 28, 1998, John and Christina Blazina, filed an NFA arbitration against Index and others, alleging breach of fiduciary duty, fraud, breach of contract and negligence in the solicitation and trading of a series of managed accounts opened at Index in 1995. Claimant seeks an award of $500,000, composed of alleged actual damages of $262,500, punitive damages of $170,000 and various other costs and fees. The Company believes that the allegations are without merit and will defend vigorously. Other- - ------- In connection with the July 1996 Sale of Assets agreement, Index issued a limited indemnification agreement to MINC related to the Sale of Assets. This agreement covers potential customer claims arising from activity prior to the sale. The Company has guaranteed certain liabilities owed by Telcom.Net, L.P. to Qwest / LCI, International. Joel Eidelstein, President of IFX, is the sole shareholder of one of the general partners of Telcom.Net, L.P. and the Company itself is a limited partner in this limited partnership. There is no maximum amount payable under this guarantee. However, the Company does not expect that the potential liability will exceed $100,000 based on the business of the limited partnership. The newly formed companies in Columbia, Argentina and Costa Rica have entered into lease commitments ranging from one to three years in duration. As of March 31, 1999, aggregate lease payments pursuant to these contracts totaled approximately $131,000. Sale of Assets - -------------- The purchase price payable by MINC in connection with the Sale of Assets is based on a percentage of the net income, as defined in the Sales Agreement, of the transferred activities during the sixty-six month period following the sale. During the three months and nine months ended March 31, 1999, the Company earned $825,400 and $3,274,000, respectively from the Sale of Assets. During the three months and nine months ended March 31, 1998 the Company earned $995,800 and $2,930,100 respectively from the Sale of Assets. Reported revenues during previous quarters of fiscal 1999, 1998 and 1997 were adjusted by MINC and increased by $486,100 during the nine months ended March 31, 1999. This adjustment was included in the Earn-out from Sale of Assets for the nine months ended March 31, 1999. 10 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Employee Stock Option Grant - --------------------------- In November, 1998, the Board of Directors granted to the Company's President, an option to purchase 300,000 shares of Common Stock, exercisable at $3.00 per share (the price of the stock as reported by the NASDAQ Stock Market as of the date of the grant was $1.75 per share). This option vested 25% on each of November 10, 1998 and January 1, 1999 and will vest an additional 25% on each of January 1, 2000 and January 1, 2001. These options were considered dilutive for the diluted earnings per share calculation for the three months and nine months ended March 31, 1999, and accordingly, are included in those calculations. Sale of Stock and Right to Purchase Common Stock - ------------------------------------------------ As previously mentioned, the Company entered into an agreement with International Technology and another major shareholder pursuant to which the Company formed ENI and other related companies to pursue opportunities in providing Internet services in Latin America and other international locales. In connection with that agreement, the Company issued to International Technology 500,000 shares of Common Stock and the right to purchase up to 5,500,000 additional shares of Common Stock, at a price of $2.00 per share, for a total price of $1,000,000, effective November 23, 1998. Using a fair value pricing model, the value of this right to purchase additional shares of common stock was estimated at approximately 45% of the value of the total consideration received for the stock and the stock purchase right. This right to purchase stock was considered dilutive for the earnings per share calculation for the three and nine months ended March 31, 1999 and accordingly, was included in the diluted earnings per share calculations. Capital Requirements - -------------------- IFX Ltd. became a registrant of the British Securities and Futures Authority ("SFA") during November 1996. As such, IFX Ltd. is subject to the financial resources requirements adopted and administered by the SFA. As of March 31, 1999, IFX Ltd.'s financial resources, as defined by the SFA, were approximately $5,331,000, which was approximately $2,406,000 in excess of its requirements. 11 IFX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Subsequent Events - ----------------- On April 12, 1999, the Company, through a wholly owned subsidiary, purchased all of the capital stock of Interweb Mexico, S.A. de C.V. ("Interweb"), an ISP based in Mexico City, Mexico, for approximately $700,000, plus an additional amount on the first anniversary of the closing if certain conditions are met. On April 15, 1999, the Company acquired, through a wholly owned subsidiary, all of the capital stock of International Connection Service 1500, C.A. ("Intercon"), an ISP based in Caracas, Venezuela. The consideration paid in this acquisition was 12,982 shares of the Company's common stock, plus additional shares contingent upon the number of qualified users one year after the closing. On April 16, 1999, Intercon acquired certain Internet service-related assets, including customer lists, from Eldish Marketing, C.A. ("Eldish"), an ISP located in Caracas Venezuela, for $100,000 plus the issuance of 93,786 shares of the Company's common stock. The Company intends to consolidate the customers acquired from Eldish into Intercon. On April 23, 1999, IFX, through a wholly owned subsidiary, entered into an agreement with YUPI Internet, Inc. ("Yupi"), a Miami, Florida based company. Yupi has developed a Spanish-language web navigation and portal site. Pursuant to such agreement, IFX invested $3 million into Yupi in exchange for convertible preferred stock and the right to acquire up to 25,901 shares of Yupi common stock at an exercise price of $23.16 per share (which, together with the Company's prior investment, equals approximately 10% of the equity interest of Yupi). In May 1999, the Company signed a letter of intent with IFX Ltd. and the other significant stockholder of IFX Ltd. pursuant to which IFX Ltd. agreed to redeem the shares of IFX Ltd. capital stock owned by the Company. As consideration for such redemption, IFX Ltd. will pay to the Company a pro rata portion of IFX Ltd.'s paid in capital and a specified percentage of IFX Ltd.'s future earnings. The redemption is subject to the parties' execution of definitive documentation and is expected to close by June 30, 1999. The amount of future earnings of IFX Ltd. and the proceeds to the Company from this redemption currently are undeterminable. Earnings from IFX, Ltd. included in the Consolidated Statement of Operations totaled approximately $602,200 and $1,221,600, respectively, for the three months and nine months ended March 31, 1999, respectively. In April 1999 the Company signed a five-year lease for new space, to commence July 1, 1999. This lease provides for aggregate payments totaling approximately $350,000. 12 IFX CORPORATION AND SUBSIDIARIES Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations for the Period Ended March 31, 1999. Overview - -------- IFX Corporation (formerly Jack Carl/312-Futures, Inc.), (which when consolidated with its subsidiaries is henceforth referred to as the "Company" or "IFX") is a holding company which operates its business through its subsidiaries. FX Chicago, Inc., (formerly Index Futures Group, Inc., or "Index"), which until July 1, 1996, was the Company's principal operating subsidiary, provided a full range of futures brokerage, clearing and back office services for institutional and public commodity traders. It was a clearing member of all major U.S. commodity exchanges. Effective July 1, 1996, Index sold, transferred and assigned substantially all of its brokerage accounts ("Sale of Assets") to E.D.& F. Man International, Inc. ("MINC"). As a result of the Sale of Assets, Index no longer acts as a futures commission merchant. It immediately withdrew as a clearing member from all commodity exchanges, and terminated its registration as a futures commission merchant in December, 1996. As a condition of the Sale, Index changed its name to FX Chicago, Inc. Operations at FX Chicago, Inc. are currently limited to activity relating to the net income derived from the Sale of Assets. IFX Ltd. (formerly Index FX, Ltd.), a British corporation and a subsidiary of IFX Corporation, continues to conduct foreign exchange business as a registrant of the British Securities and Futures Authority ("SFA"). IFX Ltd. commenced trading operations in October, 1995 and became an SFA registrant in November, 1996. Following the Sale of Assets, the Company decided not to reinvest the sales proceeds in its commodities brokerage business and has been exploring other industries and business opportunities. Based on its research, the Company has determined that the Internet and telecommunications industries present the greatest opportunities for the Company's future investment and growth, though the risks associated with these lines of business are extremely high. Accordingly, the Company has recently begun to pursue the development of Internet services and the acquisition of Internet service providers ("ISPs") in South America and Mexico in addition to acquiring interest in a telecommunication business with the proceeds from the Sale of Assets and private equity offerings. In November 1998, the Company entered into an agreement with International Technology Investments, LC ("International Technology") to jointly acquire Internet services and make investments in Internet-related businesses in Latin America and other international markets. The Company is presently in the process of developing and acquiring ISP related businesses. In March 1999, the Company formed, through wholly owned subsidiaries, companies in Costa Rica, Argentina and Columbia. On March 23, 1999, the Argentinean entity was granted a license from the government of Argentina to offer full value added telecommunications services and data transmission throughout the country. The companies in Costa Rica and Columbia are seeking similar licenses. 13 In December 1998, the Company, through a wholly owned subsidiary, acquired a 25% limited partnership interest in Telcom.Net, L.P., a domestic telecommunications and Internet software development company that was co-founded in 1997 by Joel M. Eidelstein, the Company's President. The limited partnership interest entitles the Company to receive priority distributions of up to $200,000, the amount of the Company's invested capital, and after all of its other partners have received priority distributions equal to their aggregate invested capital, 25% of the profits of Telcom.Net, L.P. Subsequent to March 31, 1999, the Company, through its subsidiaries, has completed acquisitions and other business combinations and investments, and intends to complete future acquisitions, to develop a Latin American pan-regional network of ISPs. The following is a summary of the Company's significant acquisition activities to date:
Business Acquired Consideration Paid Date - ----------------- ------------------ ---- Interweb Mexico, S.A. de C.V., an ISP Approximately $700,000, plus an additional April 12, 1999 based in Mexico City, Mexico amount on the first anniversary of the closing if certain conditions are met. International Connection Service 1500, 12,982 shares of Common Stock, plus April 15, 1999 C.A., an ISP based in Caracas, Venezuela additional shares contingent upon the number of qualified users one year after the closing Eldish Marketing, C.A., an ISP based in $100,000 plus the issuance of 93,786 shares of April 16, 1999 Caracas, Venezuela Common Stock YUPI Internet, Inc., a Spanish-language $3.0 million for convertible preferred stock, April 23, 1999 web navigation and portal site plus the right to acquire up to 25,901 shares of YUPI common stock for $23.16 per share (which, together with the Company's prior investment, equals approximately 10% of the equity interest of Yupi)
Liquidity and Capital Resources - ------------------------------- The Company maintains a highly liquid balance sheet with a majority of the Company's assets consisting of short-term investments, which are reflected at market. IFX Ltd.'s role as a market maker in spot and forward foreign exchange markets for customer activities results in significant levels of customer-related balances on the Company's statement of financial condition. 14 The Company's cash and short-term investment portfolio totaled $50,517,300 at March 31, 1999. Included in this amount is approximately $39,891,800 of funds from IFX Ltd. customers, which have been invested by IFX Ltd. on the customers' behalf or are held in segregated cash accounts, pursuant to rules of the SFA. The Company's positions are generally liquid. The portfolio is invested primarily in U.S. dollar denominated securities, but also includes foreign currency positions deposited by IFX customers. As a registrant, IFX Ltd. is subject to the financial resources requirements adopted and administered by the SFA. As of March 31, 1999, IFX Ltd.'s financial resources, as defined by the SFA, were approximately $5,331,000, which was approximately $2,406,000 in excess of its requirements. Stockholders' equity at March 31, 1999 was $14,301,400. Outstanding shares of Common Stock as of March 31, 1999 totaled 6,655,539. The Company may repurchase and retire shares of its Common Stock, pursuant to a repurchase program that permits the Company to purchase up to 1,000,000 shares. The Company did not repurchase any shares pursuant to this program during the quarter and the nine months ended March 31, 1999. The Company entered into an agreement with International Technology and another major shareholder pursuant to which the Company formed various wholly owned subsidiaries to pursue opportunities in providing Internet services in Latin America and other international locales. In connection with that agreement, the Company issued to International Technology 500,000 shares of Common Stock and the right to purchase up to 5,500,000 additional shares of Common Stock, at a price of $2.00 per share, for a total price of $1,000,000, effective November 23, 1998. Using a fair value pricing model, the value of this right to purchase additional shares of common stock was estimated at approximately 45% of the value of the total consideration received for the stock and the stock purchase right. This transaction was subject to shareholder approval, which was obtained at the Company's Annual Meeting on February 3, 1999. As of June 30, 1998, the Company had lease commitments outstanding of approximately $2,100,000 through the year 2002. The majority of this commitment related to space leased in Chicago. While the Company remains legally committed under terms of the lease, subsequent to June 30, 1998, the Company subleased its' office space in Chicago through the end of the lease term. The Company has signed a sublease to occupy a much smaller space in Chicago through June 1999, providing for aggregate lease payments of approximately $70,000. The newly formed companies in Columbia, Argentina and Costa Rica have signed leases providing for aggregate lease payments of approximately $131,000 as of March 31, 1999. Subsequent to March 31, 1999, the Company signed a five-year lease for new space, to commence July 1, 1999. This lease provides for aggregate payments totaling approximately $350,000. For the nine months ended March 31, 1999, cash used by operations was approximately $914,200 compared to cash used in operations of $1,565,600 for the same period in fiscal 1998. The majority of cash provided by or used in operations is related to customer funds from customers of IFX Ltd. Cash flows from operations include the changes in invested customer funds and customer payables, and vary depending on the amount of excess customer funds at a given time. In addition, the Company invests cash not needed for operations at FX Chicago, Inc. in short-term investments such as U.S. Government obligations 15 and overnight time deposits. As of March 31, 1999, the Company held $10,445,000 in such short-term investments. Management believes existing cash and short-term investments together with operating cash flows, access to equity capital, and borrowing capacity through its principal stockholder, provide adequate resources to fund ongoing operating requirements and future capital expenditures related to the expansion of existing businesses and development of new projects. Additionally, the outstanding stock options discussed elsewhere in this report could provide a significant amount of additional capital should they be exercised. Year 2000 - --------- We are aware of the issues associated with the programming code in existing computer systems as the year 2000 approaches. The "Year 2000" problem relates to whether computer systems will properly recognize date sensitive information when the year changes to 2000. Systems that do not properly recognize such information could generate wrong data or fail. The Year 2000 problem is pervasive and complex, as virtually every company's computer operations will potentially be affected in some way. We are currently engaged in a process to evaluate our internal status with respect to the Year 2000 issue, utilizing certain employees in our evaluation of possible Year 2000 problems. The costs and expenses of such an evaluation have not been material. To date, we have not discovered Year 2000 issues in the course of our assessment that would have a material adverse effect on our business, results of operations or financial condition; however, we can give no assurance that all Year 2000 issues were discovered during the assessment or that we will not discover additional Year 2000 issues that could have such an effect. Concurrently with the analysis of our internal systems, we have begun to survey third-party entities with which we transact business, including critical vendors and financial institutions, for Year 2000 compliance. With respect to the most critical vendors, we are in the process of evaluating the Year 2000 preparedness of our telecommunications providers, on which we are reliant for the network services crucial to web hosting and Internet connectivity services. We are actively working to mitigate any potential impact by maintaining diverse providers for such network services. However, failure of any one provider may have a material impact on our operations. We completed this survey in the third quarter of 1999. Based on our conversations with these third party entities, there does not appear to be any cause for concern. If, however, this turns out to be incorrect, we cannot, at this time, estimate the effect, if any, that non-compliant systems at these entities could have on us, and we can give no assurance that the impact, if any, will not be material. Results of Operations - --------------------- In May 1999, the Company signed a letter of intent with IFX Ltd. and the other significant stockholder of IFX Ltd. pursuant to which IFX Ltd. agreed to redeem the shares of IFX Ltd. capital stock owned by the Company. As consideration for such redemption, IFX Ltd. will pay to the Company a pro rata portion of IFX Ltd.'s paid in capital and a specified percentage of IFX Ltd.'s future earnings. The redemption is subject to the parties' execution of definitive documentation and is expected to close by June 30, 1999. The amount of future earnings of IFX Ltd. and the proceeds to the Company from this redemption currently are undeterminable. Earnings from IFX Ltd. included in the Consolidated Statement of Operations totaled approximately $602,200 and 16 $1,221,600, respectively, for the three months and nine months ended March 31, 1999. Though the Company's earnings from the Sale of Assets show an increase during the nine months ended March 31, 1999, they decreased for the three months ended March 31, 1999 as compared to the same period a year ago. This decrease is due to the fact that the Company's percentage of earnings from the brokerage accounts decreased from 40% to 30%, pursuant to the Sale of Assets agreement. This payout percentage will remain in effect through December 31, 1999. After that date, the payout percentage drops to 20%, where it will remain until the Sale of Asset agreement ends on December 31, 2001. As previously mentioned, the Company has recently begun to pursue the development of Internet services and the acquisition of Internet service providers ("ISPs") in South America and Mexico and the acquisition of an interest in a telecommunication business with the proceeds from the Sale of Assets and private equity offerings. Associated with this business development are increased expenses, which to date have not been offset by revenue. It is anticipated that such business development costs will continue to increase for some time, as the Company develops its Internet network infrastructure throughout its target area. This development and expansion will require substantial financial, operational and managerial resources. The process of developing, acquiring and consolidating its ISPs and integrating its regional operations may take a significant period of time and may place a significant strain on the Company's financial resources. The Company may increase expenditures in order to accelerate the integration and consolidation of its ISPs with the goal of achieving longer-term cost savings and improved profitability. These expenses may include the following, among others: the elimination of redundant staffing positions; personnel relocation; the cancellation of overlapping unnecessary Internet access contracts; the closure of redundant points of presence; system upgrades; and the integration of these ISPs' operations onto our network, customer care, billing, financial and other international support systems. However, no assurance can be given that these projected long-term cost savings and improvements in profitability can or will be realized. Further, no assurance can be given that customer support resources will be sufficient to manage the growth in this business or that the Company will be successful in implementing its expansion program in whole or in part. Revenues were $3,525,700 and $10,413,100 during the three and nine months ended March 31, 1999, respectively, representing a decrease of 9% from the same periods a year ago. Trading revenues decreased 11% and 15% for the three months and nine months ended March 31, 1999, respectively, compared to the same periods a year ago. These decreases were largely due to volatility in the foreign currency markets during the periods. This market volatility likely contributed to a reduction of trading activity by IFX, Ltd.'s customers who are sensitive to perceived increased risk in the foreign currency markets. While interest income was basically unchanged for the three month period ended March 31, 1999, compared to the same period a year ago, it decreased $439,900, or 18% for the nine months ended March 31, 1999, compared to the same period a year ago. Lower market interest rates together with a decrease in IFX Ltd. customer funds on deposit contributed to lower overall interest income nine month period ended March 31, 1999. Customer deposits were up somewhat for the three month period ended March 31, 1999 as compared to the same period a year ago, a factor which basically offset the potential loss in interest income that would be associated with lower rates for this period. Revenues from the Sale of Assets decreased $170,400 for the three months ended March 31, 1999, compared to the same period a year ago. This decrease is due to the fact that the Company's percentage of earnings from the brokerage 17 accounts decreased from 40% to 30% this quarter, pursuant to the Sale of Assets agreement. This 30% payout percentage will remain in effect through December 31, 1999. After that date, the payout percentage drops to 20%, where it will remain until the Sale of Asset agreement ends on December 31, 2001. Revenues from the Sale of Assets increased $343,900 for the nine months ended March 31, 1999, as compared to the same period a year ago. This increase was due to the inclusion of an adjustment of $486,100 which resulted from additional income owed to the Company by MINC related to prior fiscal quarters of fiscal 1997, 1998 and 1999. Excluding MINC's prior period adjustment of $486,100, the earnings for the nine months ended March 31, 1999, actually decreased $142,200 when compared to the same period a year ago, primarily due to a slow-down of the acquired business activity. Total expenses were $2,401,900 and $6,622,000 during the three and nine months ended March 31, 1999, respectively, representing an increase of 3% for the three months and a decrease of 3% for the nine months ended March 31, 1999, respectively, when compared to the same periods a year ago. The $62,300 increase in the expense for the three months ended March 31, 1999 is largely due to increased compensation, professional and consulting and other expenses related to the formation of various wholly owned subsidiaries related to developing and acquiring ISP-related businesses. These expenses totaled approximately $376,000 this quarter. This increase in total expenses was partially offset by the reduction in other expenses that resulted from a refund of previously paid Value Added Tax to IFX Ltd., totaling $38,900 this quarter. It was also offset partially by the reduction of commission and brokerage expense, which was $185,400 less this quarter than the same period a year ago. The $190,400 decrease in the expenses for the nine months ended March 31, 1999 is largely attributable to a reduction of interest expense and the refund of previously expensed Value Added Tax to IFX Ltd. The interest expense reduction of $414,200 resulted in part from the repayment of debt which was outstanding during part of the quarter ended September 30, 1997, but which was paid off prior to the end of that quarter. It was also the result of falling interest rates as mentioned in the interest income discussion above. The Value Added Tax refund included in the expenses for the nine months ended March 31, 1999 was $260,000. The reduction in expenses was partially offset by the increased compensation and related benefits expense and other costs related to the ISP-related start-up operations previously mentioned, which totaled approximately $484,000 for the nine months ended March 31, 1999. As a result of the aforementioned changes in revenues and expenses, net income for the quarter ended March 31, 1999 was $494,000 or $.07 per share compared to net income of $764,700 or $.12 per share for the quarter ended March 31, 1998. Diluted earnings per share for this quarter was $.04, compared to $.12 per share for the quarter ended March 31, 1998. Net income for the nine months ended March 31, 1999, was $1,966,200 or $.31 per share, compared to net income of $2,425,800 or $.39 per share for the same period a year ago. Diluted earnings per share for the nine month period ended March 31, 1999 was $.24, compared to $.39 for the same period a year ago. Forward-Looking Statements - -------------------------- Statements contained in this Form 10-Q regarding the Company's prospective business opportunities, anticipated future results of operations and planned expansion are forward-looking statements that involve substantial risks and uncertainties. Such forward-looking statements include (i) the Company's belief that it will not incur material costs or operational 18 disruptions as a result of Year 2000 problems that may be resident in its, or its customers' and suppliers' computer information systems, (ii) potential changes in the projected future business prospects and continued profitability of IFX Ltd.'s operations, (iii) the Company's belief that the Internet and telecommunications industries present profitable investment and growth opportunities for the Company and the Company's abilities to succeed and be profitable in the development and acquisition of Internet services and telecommunication businesses, (iv) the amount of future revenues the Company expects to receive from MINC pursuant to the Sale of Assets Agreement, (v) the amount and nature of planned capital expenditures, (vi) the Company's belief that its existing cash, short-term investments, operating cash flows, access to equity capital and borrowing capacity will be sufficient to finance the Company's ongoing operations and future capital expenditures, and (vii) statements relating to the Company or its operations that are preceded by terms such as "anticipates", "expects", "believes" and similar expressions. In accordance with the Private Securities Litigation Reform Act of 1995, following are important factors that could cause the Company's actual results, performance or achievements to differ materially from those implied by such forward-looking statements: The Company has not determined (and may be unable to determine) with certainty the magnitude and scope of any Year 2000 problems that may be resident on its, or on its customers' or suppliers' information or non-information systems. There can be no assurance that IFX Ltd. can maintain its historic growth rate or profitability. The amount of revenues the Company receives pursuant to the Sale of Assets agreement is dependent upon (i) the amount of earnings MINC generates from the brokerage accounts it purchased from Index and (ii) the contractual percentage of such earnings to which the Company is entitled, which is set forth in the agreement and decreases over time. The Company cannot accurately predict how creation of a single European currency and the implementation of the European Monetary Union will affect the profitability of its foreign currency trading operations. The Company has never conducted business in the telecommunications or Internet-related industries and there can be no assurance that the Company's entrance into these industries will be successful. 19 Item 3. - Quantitative and Qualitative Disclosures about Market Risk The Company's exposure to market risk is directly related to its role, through IFX Ltd., as a foreign exchange market maker in customer-related transactions. IFX Ltd.'s primary market risk exposure relates to foreign exchange rate risk. Foreign exchange rate risk arises from the possibility that changes in foreign currency exchange rates will adversely impact the value of the financial instruments. When IFX Ltd. buys or sells a foreign currency or a financial instrument denominated in a foreign currency, exposure exists from the net open currency position. Until selling or buying an equivalent amount of the same currency covers the position, IFX Ltd. is exposed to the risk that the exchange rate may move against it. In general, IFX Ltd. offsets it open customer positions, thus substantially reducing its foreign exchange rate risk. IFX Ltd. is also exposed to credit risk. Credit risk arises from the potential inability of market counterparties, such as exchanges and banks, or customers to perform an obligation in accordance with the terms of the contract. IFX Ltd. has established policies and procedures to manage credit risk. A Credit Committee is responsible for approving and reviewing new and existing customer accounts. The Committee is responsible for establishing margin requirements and margin call levels, position limits and trade restrictions (i.e., 1-month forward trading, instrument types, etc.). The Finance Officer is responsible for monitoring all customer accounts on a daily basis to ensure that they are in compliance with the agreed terms of trading. Customer trading positions, equity balances, margin excess amounts, and margin calls are monitored daily. As IFX Ltd. conducts the majority of its business for its customers in foreign currencies on the spot market, its trades generally settle on the next business day. However, if margin calls are necessary and not satisfied in a timely manner, (i.e. within 5 days), IFX Ltd. reserves the right to liquidate all or part of the customer's open positions. Management believes that with trades settling the next business day and the margin policies it employs, its credit risk is somewhat mitigated. 20 Part II - Other Information Item 1. Legal Proceedings See Notes to Consolidated Financial Statements. Item 4. Submission of Matters to a Vote of Security Holders On February 3, 1999, the Company held its 1998 annual meeting of stockholders, at which there were 4,377,276 shares, or approximately 65.8% of the shares entitled to vote, present or represented by proxy. At the annual meeting, the following matters were approved by more than the requisite number of stockholders: All of the persons nominated to become directors of the Company were elected. The number of votes cast for and withheld for each director were as follows: Votes Cast For Withheld ---------- -------- Joel M. Eidelstein 4,292,999 84,276 Colleen M. Downes 4,292,884 84,391 Zalmon Lekach 4,292,833 84,442 George A. Myers 4,292,999 84,276 Joseph M. Matalon 4,292,999 84,276 A proposal was made to ratify the sale of 500,000 shares of common stock of IFX Corporation to International Technology Investments, LC and to grant to International Technology Investments, LC a right to purchase up to 5,500,000 additional shares of IFX Corporation common stock, and to approve the issuance of such shares upon exercise of the right, which transactions may result in a change of control of the Company. The proposal was approved with 4,267,507 shares of Common Stock voted for and 105,438 shares voted against the proposal, and 4,330 shares abstaining. A proposal to approve the IFX Corporation 1998 Stock Option and Incentive Plan was approved, with 4,188,648 shares voted for and 185,562 shares voted against the proposal, and 3,064 abstaining. A proposal to ratify the engagement of Arthur Andersen LLP as the Company's independent auditors for the fiscal year ending June 30, 1999 was approved, with 4,375,198 shares voted for and 1,283 shares voted against the proposal, and 795 shares abstaining. Item 6. Exhibits and Reports on Form 8-K (A) Exhibits 11.1 Computation of earnings per Common Share 27 Financial Data Schedule (EDGAR only) (B) REPORTS ON FORM 8-K None 21 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. IFX CORPORATION --------------- (Registrant) Dated: May 14, 1999 By: /S/ COLLEEN M. DOWNES ------------------------ Colleen M. Downes Chief Financial Officer 22 EX-11.1 2 COMPUTATION OF EARNINGS PER COMMON SHARE Exhibit 11.1 IFX CORPORATION AND SUBSIDIARIES Computation of Earnings Per Common Share as Restated for the One-for-Five Reverse Split of Common Stock - Basic Earnings Per Share Computation
Three Months Ended March 31, 1999 March 31, 1998 -------------- -------------- Earnings: Net income $ 494,000 $ 764,700 ========= ========= Shares: Weighted average number of common shares outstanding 6,655,539 6,278,584 ========= ========= Earnings per common share: Net income $ .07 $ .12 ========= ========= Nine Months Ended March 31, 1999 March 31, 1998 -------------- -------------- Earnings: Net income $1,966,200 $2,425,800 ========== ========== Shares: Weighted average number of common shares outstanding 6,390,940 6,277,627 ========== ========== Earnings per common share: Net income $ .31 $ .39 ========== ==========
IFX CORPORATION AND SUBSIDIARIES Computation of Earnings Per Common Share as Restated for the One-for-Five Reverse Split of Common Stock - Diluted Earnings Per Share Computation
Three Months Ended March 31, 1999 March 31, 1998 -------------- -------------- Earnings: Net income $ 494,000 $ 764,700 ========== ========== Shares: Weighted average number of common shares outstanding 11,138,702 6,278,584 ========== ========== Earnings per common share: Net income $ .04 $ .12 ========== ========== Nine Months Ended March 31, 1999 March 31, 1998 -------------- -------------- Earnings: Net income $1,966,200 $2,425,800 ========== ========== Shares: Weighted average number of common shares outstanding 8,180,435 6,277,627 ========== ========== Earnings per common share: Net income $ .24 $ .39 ========== ==========
EX-27 3 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from IFX Corporation, Form 10Q as of 3/31/99 and is qualified in its entirety by reference to such financial statements. 3-MOS 9-MOS JUN-30-1999 JUN-30-1999 JAN-01-1999 JUL-01-1999 MAR-31-1999 MAR-31-1999 0 312,800 0 50,204,500 0 7,378,900 0 (80,100) 0 0 0 57,816,100 0 952,200 0 (447,000) 0 60,105,100 0 43,507,700 0 0 0 0 0 0 0 133,100 0 14,168,300 0 60,105,100 129,300 464,200 3,525,700 10,413,100 0 0 0 0 2,000,400 5,524,900 0 0 401,500 1,097,100 1,123,800 3,791,100 350,100 1,295,400 494,000 1,966,200 0 0 0 0 0 0 494,000 1,966,200 .07 .31 .04 .24
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