Notes To Condensed Financial Statements
For The Three Month Periods Ended March 31,
2019 and 2018
Note 1 - Basis of Presentation
Pursuant to a recommendation
of the Company’s Board of Directors and approval by its shareholders on January 13, 2004, the Company sold to NC Acquisition
Corporation (the "Purchaser") on March 31, 2004 all of its tangible and intangible assets, including its real estate,
accounts, equipment, intellectual property, inventory, subsidiaries, goodwill, and other intangibles, except for $30,000 in cash,
(the "Net Asset Sale"). The Purchaser also assumed all of the Company’s liabilities pursuant to the Net Asset Sale.
Following the Net Asset Sale, the Company’s only remaining assets were $30,000 in cash and it had no liabilities. It also
retained no subsidiaries. On April 1, 2004 the Company amended its Articles of Incorporation to change its name from Nematron Corporation
to Sandston Corporation (the “Company”) and to implement a shareholder approved one-for-five reverse stock split of
the Company’s common stock, whereby every five issued and outstanding shares of the Company’s common stock became one
share. On April 1, 2004 the Company also sold a total of 5,248,257 post-split shares to Dorman Industries, LLC (“Dorman Industries”)
for $50,000. Dorman Industries is a Michigan Limited Liability Company wholly owned by Mr. Daniel J. Dorman, the Company’s
Chairman of the Board, President and Principal Accounting Officer. Pursuant to its purchase of these shares, Dorman Industries
became the owner of 62.50% of the then outstanding common stock of the Company. The Company has made subsequent sales of common
stock to Dorman Industries in order to raise cash to pay operating expenses:
Periods
|
|
Shares
|
|
|
Proceeds
|
|
December, 2010
|
|
|
500,000
|
|
|
$
|
15,000
|
|
November, 2011
|
|
|
375,000
|
|
|
|
15,000
|
|
September, 2012
|
|
|
1,500,000
|
|
|
|
15,000
|
|
November, 2013
|
|
|
361,767
|
|
|
|
10,853
|
|
February, March, and August 2014
|
|
|
733,300
|
|
|
|
21,803
|
|
March, August, and November 2015
|
|
|
394,506
|
|
|
|
15,780
|
|
February, March, April, July, August, and November 2016
|
|
|
523,867
|
|
|
|
18,635
|
|
January, February, June, July, September, November, and December 2017
|
|
|
955,883
|
|
|
|
21,262
|
|
March, May, and October 2018
|
|
|
524,358
|
|
|
|
18,132
|
|
March 2019
|
|
|
314,525
|
|
|
|
12,581
|
|
Dorman Industries currently
is the beneficial owner of 67.32% of the Company’s outstanding common stock. Patricia A. Dorman, Mr. Dorman’s wife,
is the beneficial owner of an additional 3.53% of the Company’s outstanding common stock.
Effective April 1, 2004, the Company became
a "public shell" corporation.The Company intends to build long-term shareholder value by acquiring and/or investing in
and operating strategically positioned companies. The Company expects to target companies in multiple industry groups. The Company
has yet to acquire, or enter into an agreement to acquire, any company or entity.
During the period prior to the Net Asset Sale,
the Company’s businesses included 1) the design, manufacture, and marketing of environmentally ruggedized computers and computer
displays known as industrial workstations; 2) the design, development and marketing of software for worldwide use in factory automation
and control and in test and measurement environments; and 3) providing application engineering support to customers of its own
and third parties’ products.
Liquidity and Management Plans
The Company became a "public shell"
corporation on April 1, 2004 following the Net Asset Sale and since that date its operational activities have been limited to considering
sundry and various acquisition opportunities, and its financial activities have been limited to administrative activities and incurring
expenditures for accounting, legal, filing, printing, office and auditing services. These expenditures have been paid with the
$30,000 cash retained from the businesses that were sold, from $50,000 of proceeds from the sale of common stock on April 1, 2004
to Dorman Industries and from $284,046 of proceeds from the sale of stock since that date to certain accredited investors, including
Dorman Industries.
As reflected in the accompanying balance sheet
at March 31, 2019, cash totals $200. Based on such balance and management’s forecast of activity levels during the period
that it may remain a “public shell” corporation, management believes that it will have to again sell through private
placement a number of additional shares of common stock to generate sufficient cash to pay its current liabilities and its administrative
expenses as such expenses become due in 2019. If the Company has not identified and consummated an acquisition by that date, the
Company will need to obtain additional funds to maintain its administrative activities as a public shell company. Management intends
to obtain such administrative funds from Dorman Industries in the form of loans or through equity sales in an amount sufficient
to sustain operations at their current level. Dorman Industries owns 67.32% of the Company’s outstanding common stock. There
can be no assurance that Dorman Industries or any other party will advance needed funds on any terms. The Company has not identified
as yet potential acquisition candidates, the acquisition of which would mean that the Company would cease being a “public
shell” and begin operating activities.
In the opinion of management, all adjustments
considered necessary for a fair presentation of the consolidated financial statements for the interim periods have been included.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the Securities and Exchange Commission’s rules and regulations,
although the Company believes that the disclosures are adequate to make the information presented not misleading. These condensed
consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included
in the Company’s latest annual report on Form 10-K.
The results of the operations for the three
month periods ended March 31, 2019 and 2018 are not necessarily indicative of the results to be expected for the full year. Additionally,
since the Net Asset Sale, which was effective April 1, 2004, the Company has had no revenue generating activities.
Note 2 – Earnings Per Share
The weighted average shares outstanding used
in computing basic loss per share for the three month periods ended March 31, 2019 and 2018 have been adjusted to give effect to
the five-for-one reverse stock split discussed in Note 1. The Company has no dilutive securities.