UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
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x
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ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
[FEE REQUIRED]
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For the
fiscal year ended March 31, 2008.
OR
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o
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TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED]
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For the
transition period
from to .
Commission
file number 2-87738
T.H.
LEHMAN & CO., INCORPORATED
(Exact
name of small business issuer as specified in its charter)
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Delaware
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22-2442356
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(State
or other jurisdiction of incorporation or organization)
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(I.R.S./Employer
Identification No.)
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1155
Dairy Ashford Rd., Suite 650, Houston, Texas 77079
(Address
of principal executive offices)
Issuer's
telephone number, including area code: (281) 870-1197
Securities
registered under Section 12(b) of the Exchange Act: None
Securities
registered under Section 12(g) of the Exchange Act:
Common
Stock, $.01 par value
Preferred
Stock, $.01 par value
Indicate
whether the registrant is a well-known seasoned issuer, as defined in Rule 405
of the Securities Act.
Yes
£
No
S
Indicate
if the registrant is not required to file pursuant to Section 13 or Section
15(d) of the Act.
Yes
£
No
S
Indicate
whether the registrant (1) filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act 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
S
No
£
Indicate
if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of the registrant’s
knowledge, in definitive proxy or information statements incorporated by
reference in Park III of this Form 10-K or any amendment to this Form
10-K
S
Indicate
whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company.
Large
accelerated filer □ Non-accelerated filer
□ Accelerated filer
□ Smaller reporting company
S
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act.
Yes
□ No
S
The
registrant’s revenues for the fiscal year ended March 31, 2008 were
$98,672.
The
aggregate market value of the voting stock held by non-affiliates, of the
registrant is approximately $3,203,504.70 as of May 6, 2008. This is
based on 5,824,554 shares of common stock held by
non-affiliates. (Based upon the price at which the common stock was
sold or the average bid and asked of such common stock for the last trading date
prior to that date).
The
number of shares outstanding of the issuer’s class of common stock as of May 6,
2008 was 6,970,118.
TABLE OF CONTENTS
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Page
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PART
I.
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Item
1.
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3
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Item
2.
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4
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Item
3.
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4
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Item
4.
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4
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PART
II.
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Item
5.
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4
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Item
6.
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4
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Item
7.
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6
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Item
8.
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6
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Item
8A.
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6
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PART
III.
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Item
9.
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7
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Item
10.
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7
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Item
11.
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8
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Item
12.
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8
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PART
IV.
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Item
13.
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9
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F-1
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F-2
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F-3
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F-7
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PART
I
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BUSINESS
ITEM 1.
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DESCRIPTION
OF
BUSINESS
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Introduction:
T.H. Lehman & Co.,
Incorporated (referred to as the "Company or Registrant"),
was organized in March, 1983 as a Small
Business Development Company ("SBDC") and was an SBDC until April,
1988. From April, 1988 to August, 1990 it operated
through subsidiaries as a broker/dealer and investment
advisor. Although it is
no longer an SBDC and has sold its broker/dealer
and investment advisory
business, the Company continues to maintain certain of its investments.
Non-Operating
Reporting Entity:
Currently
the Company has closed all operations and has no continuing business
operations. The Company is operating as a public shell and its
business operations consist of management seeking merger and acquisition
candidates with ongoing operations and the collection of receivables from its
discontinued operations. The Company has no existing funding
commitments and is presently under no contractual obligation to make
any investment or acquisition. The history of the Company’s business
is detailed below.
Medical
Financial Services:
The
Company in August 1992 began operations in the area of medical financial
services, such services being provided through specific subsidiaries. The
primary focus of these operations was the financing and collection of accounts
receivable generated by medical practitioners through their provision of
diagnostic services and patient treatment.
MedFin
Management Corp. was created to provide medical practitioners with
non- medical
general and administrative functions such
as accounting, marketing,
management, non-medical staffing, facilities, equipment, and billing and
collection of receivables. Revenues were
derived from fees charged for these services. The company
had one client, which operated a specialty
clinic in the Los Angeles, California
area. This client concentrated its practice on workers'
compensation medicine and treatment for personal injury
victims, providing services primarily on a lien basis.
Beginning in June 2000, the
client decided to stop practicing
medicine and transfer his clients and files to another provider. In April 2000,
Med-Fin Management Services, Inc. was
created to provide the new client with the same service.
MedFin Management
Corp. and Med-Fin Management Services, Inc. received, as a fee for their clinic
management services, revenues that were indirectly related to the
overall collections of their client practitioners' receivables.
MedFin Management
Corporation and Med-Fin Management Services, Inc.
also provided
working capital on an as-needed basis to
those clients with receivables as collateral for such advances and UCC filings
made thereon. However, the Company was not engaged in the practice of medicine
which, for non- doctor controlled entities, is not legally allowed in
California.
As a
further adjunct to the financing/management
services provided through subsidiaries to medical practitioners,
effective February 1, 1993, the Company purchased Healthcare Professional
Billing Corp. (HPB), in Broomfield, Colorado a billing and collection
service that is utilized by doctors in the metropolitan Denver
and surrounding areas.
In a
transaction that was effective October 1, 1996, the Company transferred 50% of
the outstanding stock and substantially
all of the control of Healthcare Professional Billing Corp. to certain key
employees of that company. Until that time, Healthcare Professional Billing
Corp. was a wholly-owned subsidiary of the Company. As
a result of the transfer, the
subsidiary's financial position, results of
operations and cash flows are not
consolidated with that of the Company's subsequent to the transfer
date, however, until advances made to HPB
are paid off the Company will receive part of HPB's
positive cash flow.
The
Company wound down its medical business management office in February 2005, the
date its medical office lease expired. In February 2005 the Company had closed
all its patients’ cases and final billed all the services rendered by the
providers, and, for the patients that could not be finalized, referred them to
other providers, but billed through the date that the providers had rendered
services. The Company has engaged a consultant to follow up on collections for
all its receivables that have been assigned to the medical business management
entity. The collection of these receivables is significantly complete. The
Company does not expect significant collections nor incurring significant costs
on the remaining provider receivables that it manages. The valuation
of the existing receivables as of March 31, 2008 after taking into consideration
the expected future collection costs is zero. There were no long-lived assets
related to the discontinued operation nor are there expected to be gains or
losses from the discontinuance of the medical business management
segment.
Environmental
Matters:
The
Company was subject to various laws and regulations with respect to employee
health and safety and the protection of the environment.
The Company believes that it was in substantial compliance with such laws and
regulations.
Employees:
The
Company employs 1 person as a consultant in the medical management
field that is engaged in the collection effort of provider
receivables. The Company believes that its employee relations are
satisfactory. Employees are not subject to any collective
bargaining agreement and work stoppages
have not yet materially affected the
Company's business.
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ITEM
2.
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DESCRIPTION
OF
PROPERTY
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The Company presently has an
administrative sharing arrangement which, among other things,
provides use of other office facilities in Houston,
Texas. MedFin Management Corporation currently leases office
space in Sherman Oaks, California that is being utilized for
collection and record storage purposes. Monthly rental payments are $695,
including all utilities. The rental of this space will end as of June
30, 2008.
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ITEM
3.
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LEGAL
PROCEEDINGS
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Neither
the Company nor its subsidiaries is currently party
to any other material legal proceeding.
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ITEM
4.
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SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS
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The
Company did not have any matters to submit to a vote of the security
holders.
PART
II
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ITEM
5.
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MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
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The
Company's Common Stock (symbol THLM) is
traded in the Over-The-Counter Market,
on the Electronic Bulletin Board. The range of high
and low bid quotations as reported by the NASDAQ Inter-Dealer
Quotation System for the two
year period ended March 31, 2008 are as follows:
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For
the Quarter Ended
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High
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Low
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June
30, 2006
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$
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.20
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$
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.20
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September
30, 2006
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$
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.20
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$
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.20
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December
31, 2006
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$
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.20
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$
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.20
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March
31, 2007
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$
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.20
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$
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.20
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June
30, 2007
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$
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.60
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$
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.60
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September
30, 2007
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$
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.60
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$
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.60
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December
31, 2007
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$
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.75
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$
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.75
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March
31, 2008
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$
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.55
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$
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.55
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The
above quotations do not include commissions, markups, or markdowns
and may not represent actual transactions.
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b)
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Number
of Holders of Common Stock
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As of May
6, 2008 the Company had approximately 118 shareholders of record. Cede & Co.
was the registered holder of 1,044,313 shares. Because many of the shares are
registered in street name, the Company believes that there are a substantially
greater number of beneficial owners.
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c)
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Dividends
on Common Stock
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The
Company's Board of Directors does not currently intend to pay cash dividends and
has not paid any in the two year period ended March 31, 2008.
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ITEM
6.
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MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
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Critical
Accounting Policies:
The
discussion of the financial condition and results of operations are based upon
the audited consolidated condensed financial statements, which have been
prepared in conformity with accounting principles generally accepted in the
United States. As such, management is required to make certain estimates,
judgments and assumptions that are believed to be reasonable based on the
information available. These estimates and assumptions affect the reported
amount of assets and liabilities, revenues and expenses, and disclosure of
contingent assets and liabilities at the date of the financial statements.
Actual results may differ from these estimates under different assumptions or
conditions.
Critical accounting policies are defined as those that are
reflective of
significant judgments and uncertainties, and
potentially result in materially
different results under different assumptions
and conditions. The Company has determined that the following
accounting policies and estimates are critical to
the understanding of the Company's consolidated financial statements.
Revenue
Recognition and Allowance for Doubtful Accounts:
The
Company derived its management fee (discontinued operations) revenue under the
contractual provisions between the Company as the manager and
the professional health care provider. The Company earned
its management fee based on a percentage of net revenue to be derived
by the health care provider. This management fee was recorded in the
accounting records on an accrual basis as a percentage of the
professional health care company's net revenues, which gave effect to the
difference between, established charges and estimated third-party payer
payments. The Company further provided an allowance for doubtful
accounts to reduce its receivables to their net realizable value based on
estimates by management for general factors such as the aging of the
receivables and historical collection experience.
Statements
of Operations for continuing operations:
Fiscal
Year Ended March 31, 2008 Compared to Fiscal Year Ended March 31,
2007
Revenues
totaled $98,672 during the fiscal year ended March 31, 2008, 92.9% lower than
the previous year’s revenues of $1,387,264. Realized gain from sales
of securities for the year 2008 was $85,459 compared to $1,351,824 for
2007. Operating expenses in 2008 were $114,441 compared to
$91,121 in 2007, an increase of 25.6%. The increase is due to an
increase in Professional fees due to new business
explorations. Interest expense was $0 in 2008 compared to $11,778 in
2007 after all remaining loans were paid off in 2007.
Fiscal
Year Ended March 31, 2007 Compared to Fiscal Year Ended March 31,
2006
Revenues
totaled $1,387,264 during the fiscal year ended March 31, 2007, 3,611% higher
than the previous year’s revenues of $37,381. Included in the total
2007 revenues is $1,346,238 of realized gain from sales of KSW,
Inc. Operating expenses remained very comparable from $91,788 in 2006
to $91,121 in 2007. General and Administrative expenses
were relatively the same with interest expense decreasing 27.0% from
$16,148 to $11,778 after all remaining loans were paid off in 2007.
Statements
of Operations for discontinued operations:
Fiscal
Year Ended March 31, 2008 Compared to Fiscal Year Ended March 31,
2007
On a net
basis there was a loss in 2008 of $27,477 compared to a loss in 2007 of $35,322
a decrease of 22%. Income from collections in 2008 was $21,416
compared to $133,000 in 2007. General and Administrative expenses
decreased to $48,893 in 2008 compared to $168,322 in 2007, mainly due to lower
collection costs and professional fees in collecting the receivables and the
write down of the remaining receivables in 2007.
Fiscal
Year Ended March 31, 2007 Compared to Fiscal Year Ended March 31,
2006
Due to
the collection of receivables (discontinued operations) greater
than previously expected, fiscal year ended March 31, 2007 had
revenues of $133,000 compared to $0 for the prior fiscal year ended
March 31, 2006. General and Administrative expenses
increased to $168,322 in 2007 compared to $134,750 in 2006 mainly due
to a write off of the remaining receivables as uncollectible.
Liquidity,
Capital Resources and Income Taxes
At March
31, 2008 cash amounted to $530,130 a decrease of $411,776 over the cash balance
of $941,906 at March 31, 2007. The cash will be used to fund
operations.
The
Company's primary source of liquidity has been the cash it has obtained from the
liquidation of its investment portfolio and distribution of HPB's
profit.
The
Company anticipates that internally generated cash will be sufficient to finance
overall operations.
The
Company’s consolidated financial statements have been prepared
assuming the Company will continue as a going concern, which
contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. Management
of the Company expects that cash balances at March 31, 2008 will be
adequate to maintain its corporate existence. However, no
assurance can be provided that these results will materialize.
Ultimately,
the Company’s ability to continue as a going concern is dependent upon its
ability to attract new sources of capital, establish an
acquisition or reverse merger candidate with continuing operations,
attain a reasonable threshold of operating efficiencies and achieve profitable
continuing operations.
The
Company is seeking to acquire businesses and may be in various stages of
negotiations at any point in time which may or may not result in consummation of
a transaction. To provide funding for such acquisitions it may take a number of
actions including (i) selling of its existing investments (ii) use of available
working capital (iii) seeking short or long term loans (iv) issuing stock. In
addition, the Company may seek additional equity funds if needed. These sources
of capital may be both conventional and non-traditional. The Company has no
existing funding commitments and is presently under no contractual obligation to
make any investment or acquisition.
At March
31, 2008, the Company had an operating tax loss carry forward of approximately
$4,800,000.
Impact of
Inflation and Other Business Conditions
Generally, increases in the
Company's operating costs approximate the rate of inflation. In the opinion of
management, inflation has not had a material effect on the operation of the
Company. The Company has historically been able to react effectively to
increases in labor or other operating costs through a combination
of greater productivity and selective price increases where allowable.
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ITEM
7.
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FINANCIAL
STATEMENTS
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The
financial statements and supplementary data are listed at "ITEM 13: EXHIBITS AND
REPORTS ON FORM 10-K" in this document.
(See
Index Exhibits Part
IV Item 13 (a) Financial Statements: F1)
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ITEM
8.
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CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
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None
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ITEM
8A.
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CONTROLS
AND
PROCEDURES
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Management’s
Annual Report on Internal Control Over Financial Reporting
Our
management is responsible for establishing and maintaining adequate
internal control over financial reporting. Internal control over
financial reporting is defined in Rules 13a-15(f) and 15d-15(f)
under the Securities Exchange Act, as amended, as a process designed
by, or under the supervision of, a company’s principal executive and
principal financial officers and effected by a company’s board of
directors, management and other personnel to provide reasonable
assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Our
internal control over financial reporting includes those policies and
procedures that:
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*
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pertain
to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions
of our assets;
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*
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provide
reasonable assurance that transactions are recorded as necessary
to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that our
receipts and expenditures are being made only in accordance
with authorizations of our management and
directors;
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*
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and
provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use or disposition of our assets
that could have a material effect on the financial
statements.
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Internal
control over financial reporting cannot provide absolute assurance
of achieving financial reporting objectives because of its inherent
limitations. Internal control over financial reporting is a process
that involves human diligence and compliance and is subject to lapses
in judgment and breakdowns resulting from human failures. Internal
control over financial reporting also can be circumvented by
collusion or improper management override. Because of
such limitations, there is a risk that material misstatements may not
be prevented or detected on a timely basis by internal control over
financial reporting. However, these inherent limitations are known
features of the financial reporting process. Therefore, it is
possible to design into the process safeguards to reduce, though not
eliminate, this risk. In addition, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in conditions or that
the degree of compliance with the policies or procedures may
deteriorate. In order to evaluate the effectiveness of our internal
control over financial reporting as of March 31, 2008, as required by
Sections 404 of the Sarbanes-Oxley Act of 2002, our management
commenced an assessment, based on the criteria set forth in Internal
Control—Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (the “ COSO
Framework “). A material weakness is a control deficiency, or a
combination of control deficiencies, that results in more than a
remote likelihood that a material misstatement of our annual or
interim financial statements will not be prevented or detected on a timely
basis. In assessing the effectiveness of our internal control over
financial reporting, our management, including the chief executive
officer and chief financial officer, did not identify any
deficiencies.
Management
believes that the financial statements included in this report
fairly present in all material respects our financial condition,
results of operations and cash flows for the periods presented. We
have put an implementation plan in place whereby in fiscal year 2009
sufficient testing to satisfy COSO requirements will be performed.
The absence of the ability to conclude as to the sufficiency
of internal controls, is a material weakness.
This
annual report does not include an attestation report of our
independent registered public accounting firm regarding internal
control over financial reporting. Our internal controls were not
subject to attestation by our independent registered public
accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit us to provide only managements report
in this annual report.
Changes in Internal Control Over
Financial Reporting
. There were no significant changes in the
Company’s internal controls or in other factors that could
significantly affect internal controls subsequent to the date of the
evaluation above.
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ITEM
8B.
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OTHER
INFORMATION
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PART
III
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ITEM
9.
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DIRECTORS
, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS;COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
ACT
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The
Directors and Executive Officers of the Company are as follows:
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Name
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Age
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Director
Since
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Position
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Elliot
Gerstenhaber
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62
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1996
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Director
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Raffaele
Attar
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35
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2000
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Director
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Gary
Poe
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41
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Secretary/Treasurer
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The term
of office of each director is until the next Annual Meeting of Shareholders, or
until such time as their successors shall have been duly elected and qualified.
Officers serve at the pleasure of the board. There are no family relationships
between any of the Company's directors or officers.
Background
of Officers and Directors:
Elliot
Gerstenhaber is a 1968 graduate of the
University of Pennsylvania. He
received a juris doctorate degree from South
Texas College of Law in 1975. In 1995 he left the private
practice of law to develop real estate throughout the
southeastern United States. He is
President of Segue, Inc., a privately-held company.
Raffaele Attar graduated from St. John's
College in 1995 with a degree in Philosophy and Mathematics. Mr. Attar has 11
years of experience as an investment analyst
including 8 years experience in the
medical financing industry.
Gary Poe is a 1989 graduate of
Sam Houston State University holding a B.A. degree in
General Business. Mr. Poe has been associated with Woodco
Fund Management (WFM) since March 1999. Prior to joining
WFM, Mr. Poe worked as an assistant controller with a hotel management company
in Houston, Texas. Mr. Poe has over
19 years of financial accounting experience.
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ITEM
10.
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EXECUTIVE
COMPENSATION
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Compensation
of Officers and Directors:
Set
forth below is the aggregate remuneration paid
to the Company's officers during
the fiscal years ended March 31,
2008, 2007, and 2006.
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Name
and Principal Position
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Year
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Salary
|
|
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Restricted
Stock Awards
|
|
|
None
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2008
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
None
|
|
|
2007
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
None
|
|
|
2006
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
ITEM
11.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
|
Principal
Shareholders
The following table lists, to the best of the Company's knowledge,
the beneficial stock ownership of those persons owning beneficially
more than 5% of the
Company's outstanding common stock, as well as
the stock ownership of executive officers and each director as of May 6,
2008:
|
Name
and Address Of Beneficial Owner
|
|
Amount
and Nature Of Beneficial Owner
|
|
|
Percent
of Class
|
|
|
|
|
|
|
|
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Title
of Class (a) Common Stock
|
|
|
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|
|
|
|
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|
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|
|
|
Monahan
Corporation, N.V.
|
(2
|
)
|
|
|
|
|
|
|
|
Landhuis
Joonchi
|
|
|
3,144,238
|
|
|
|
45.11
|
%
|
|
Kaya
Richard J. Beaujon z/n
|
|
|
|
|
|
|
|
|
|
P.O.
Box 837
|
|
|
|
|
|
|
|
|
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Curacao,
Netherlands Antilles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Burton,
N.V.
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
Landhuis
Joonchi
|
|
|
281,383
|
|
|
|
4.04
|
%
|
|
Kaya
Richard J. Beaujon z/n
|
|
|
|
|
|
|
|
|
|
P.O.
Box 837
|
|
|
|
|
|
|
|
|
|
Curacao,
Netherlands Antilles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Russell
Molina
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
6616
Sewanee
|
|
|
480,000
|
|
|
|
6.89
|
%
|
|
Houston,
Texas 77005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beech
Glen, Inc.
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
c/o
Capital Holdings, Inc.
|
|
|
598,164
|
|
|
|
8.58
|
%
|
|
1155
Dairy Ashford, Suite 650
|
|
|
|
|
|
|
|
|
|
Houston,
TX 77079
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
Horizons Investments Fund N.V.
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
Landhuis
Joonchi
|
|
|
610,538
|
|
|
|
8.76
|
%
|
|
Kaya
Richard J. Beaujon z/n
|
|
|
|
|
|
|
|
|
|
P.O.
Box 837
|
|
|
|
|
|
|
|
|
|
Curacao,
Netherlands, Antilles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b)
Security Ownership of Management
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dibo
Attar
|
(1
|
)
|
|
|
200,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Elliot
Gerstenhaber
|
|
|
-0-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Raffaele
Attar
|
|
|
90,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Directors
and Officers as Group 5 persons (1) (2) (3)
|
|
|
5,404,723
|
|
|
|
77.54
|
%
|
Notes to
Table of Beneficial Owners and Management:
(1)
Dibo Attar is a consultant to Capital Holdings, Inc., parent to Beech
Glen,
Inc. and father of Raffaele Attar.
(2)
Monahan Corporation, N.V., Burton, N.V., and New Horizons Investments
Fund,
N.V. are each Netherlands Antilles corporations
whose shareholders comprise
groups of European investors, none of which are
otherwise affiliated with the Company. None of the individual shareholders holds
an effective ownership of the
Company exceeding 4.9%.
(3)
Russell Molina resigned as Director and President of T.H. Lehman & Co., Inc.
effective October 3, 2002.
Except as
otherwise indicated, the address for each of the above persons is c/o
T.H. Lehman & Co., Incorporated, 1155 Dairy Ashford
Rd., Suite 650, Houston, Texas 77079.
|
ITEM
12.
|
CERTAIN
RELATIONSHIPS AND RELATED
TRANSACTIONS.
|
During the
years ended March 31, 2008 and March 31, 2007, the Company incurred
management fees for facilities and
services provided by Woodco Fund Management Inc., in the amount of $49,358 and
$49,358 respectively. Such
services are believed to have been
provided on terms no less favorable than available from a
third party. Woodco Fund Management Inc. is a asset
management company offering fee based services for accounting, record keeping
and clerical services and is controlled by related parties.
During
previous fiscal years the Company entered into formal note arrangements with its
chairman regarding advances made by the Company to an entity controlled by the
chairman. The terms of the notes required annual 6% interest payments
and all remaining balances were due at the end of three
years. The principal balances of these notes total
$91,000. The Company received an interest only check for
$10,253 on the above notes in June 2006. In June 2007 the
Company received payment in full on these notes.
Stock
Transaction Reports by Officers, Directors and 10% Stockholders:
Section 16(a) of
the Securities Exchange Act of 1934, as amended, requires the
Company's directors, executive officers and holders
of more than 10% of the Company's common stock to file with the
Commission initial reports of ownership and reports of changes in
ownership of common stock and other equity securities
of the Company. To the Company's knowledge,
based solely on copies of reports furnished to the Company and representation
that no other reports were required,
during the fiscal year ending March 31, 2008 all Section 16(a) filing
requirements were complied with in a timely manner.
PART
IV
|
ITEM
13.
|
EXHIBITS
AND REPORTS ON FORM
10-K
|
The
following documents are filed as a part of this report:
Independent
Auditor's Report
Consolidated
Balance Sheets
As of
March 31, 2008 and 2007
Consolidated
Statements of Operations
Years
Ended March 31, 2008 and 2007
Consolidated
Statements of Changes in Stockholders' Equity
Years
Ended March 31, 2008 and 2007
Consolidated
Statements of Cash Flows
Years
Ended March 31, 2008 and 2007
Notes to
Consolidated Financial Statements
|
|
(a)
|
Financial Statements
- See Index to Financial Statements at Page
F-1.
|
Exhibit
No. Exhibit
|
3.1
|
Certificate of Incorporation
of T.H. Lehman & Co., Incorporated (the
Company) as amended.*
|
|
3.2
|
By-laws of the
Company. Incorporated by reference from the Company's Form 8-A dated
October 31, 1984 for Registration of Certain Classes of Securities
Pursuant to Section 12(b) or (g) of the Securities Exchange
Act of 1934.*
|
*These
items have been previously submitted and are therefore incorporated only by
reference.
Individual
financial statements of the Company are not furnished
because consolidated financial statements are furnished.
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES CONSOLIDATED FINANCIAL
STATEMENTS YEARS ENDED MARCH 31, 2008 AND MARCH 31, 2007
|
INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS:
|
|
|
|
|
|
Report
of Independent Registered Public Accounting Firm
|
F-2
|
|
|
|
|
Consolidated
Balance Sheets
|
|
|
March
31, 2008 and 2007
|
F-3
|
|
|
|
|
Consolidated
Statements of Operations and Comprehensive Income (Loss)
|
|
|
Years
Ended March 31, 2008 and 2007
|
F-4
|
|
|
|
|
Consolidated
Statements of Stockholders' Equity
|
|
|
Years
Ended March 31, 2008 and 2007
|
F-5
|
|
|
|
|
Consolidated
Statements of Cash Flows
|
|
|
Years
Ended March 31, 2008 and 2007
|
F-6
|
|
|
|
|
Notes
to Consolidated Financial Statements
|
F-7
|
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the
Board of Directors T.H. Lehman & Co., Incorporated
I have
audited the consolidated balance sheets of T.H. Lehman & Co., Incorporated
and Subsidiaries (the "Company") as of March 31, 2008 and 2007 and the
related consolidated statements of operations, stockholders' equity
and cash flows for the years then ended. These
consolidated financial statements fare the responsibility of the
Company's management. My responsibility is to express an
opinion on these consolidated financial statements based on my
audits.
I
conducted my audits in accordance with standards of the Public
Company Accounting Oversight Board (United States). Those
standards require that I plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial
statements are free of material misstatement. An
audit includes consideration of internal control over financial
reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, I
express no such opinion. An audit also includes examining,
on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management as well as evaluating the
overall financial statement presentation. I believe my
audits provide a reasonable basis for my opinion.
In my
opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
positions of T.H. Lehman & Co., Incorporated and Subsidiaries as
of March 31, 2008 and 2007 and the results of their operations and
their cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of
America.
The
accompanying consolidated financial statements have been prepared
assuming the Company will continue as a going concern. As
discussed in Note 1 to the consolidated financial statements, the
Company had limited liquid resources, recurring losses, and is
seeking to implement its business plan, which requires the Company to
acquire or develop a business. These matters
raise substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are also
discussed in Note 1. The consolidated financial statements do not
include any adjustment that might result from the outcome of this
uncertainty.
/s/
JEFFREY S. GILBERT, CPA
Los
Angeles, California June 25, 2008
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES CONSOLIDATED
BALANCE
SHEETS
MARCH 31, 2008 AND MARCH 31, 2007
ASSETS
|
|
|
2008
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
530,130
|
|
|
$
|
941,906
|
|
|
Accounts
receivable – related party
|
|
|
48,902
|
|
|
|
60
|
|
|
Accounts
receivable
|
|
|
27,461
|
|
|
|
0
|
|
|
Current
portion of non-current receivable - related party
|
|
|
0
|
|
|
|
98,860
|
|
|
TOTAL
CURRENT ASSETS
|
|
|
606,493
|
|
|
|
1,040,826
|
|
|
OTHER
ASSETS Securities available for sale
|
|
|
162,118
|
|
|
|
243,580
|
|
|
TOTAL
OTHER ASSETS
|
|
|
162,118
|
|
|
|
243,580
|
|
|
TOTAL
ASSETS
|
|
$
|
768,611
|
|
|
$
|
1,284,406
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
|
Management
fees – related party
|
|
$
|
0
|
|
|
$
|
349,575
|
|
|
Management
fees from discontinued operations - related
party
|
|
|
0
|
|
|
|
54,112
|
|
|
TOTAL
CURRENT LIABILITIES
|
|
|
0
|
|
|
|
403,687
|
|
|
TOTAL
LIABILITIES
|
|
|
0
|
|
|
|
403,687
|
|
|
COMMITMENTS
AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY Common stock-par value $.01; authorized 20,000,000
shares, issued 6,970,118 shares at March 31, 2008 and 2007
|
|
|
69,701
|
|
|
|
69,701
|
|
|
Preferred
stock-par value $.01; authorized 10,000,000 shares,
issued 0 shares at March 31, 2008 and 2007
|
|
|
0
|
|
|
|
0
|
|
|
Additional
paid-in capital
|
|
|
8,076,340
|
|
|
|
8,076,340
|
|
|
Unrealized
gain on investments
|
|
|
136,717
|
|
|
|
205,580
|
|
|
Accumulated
deficit
|
|
|
(7,465,710
|
)
|
|
|
(7,422,464
|
)
|
|
Treasury
stock at cost - 25,000 shares
|
|
|
( 48,438
|
)
|
|
|
( 48,438
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
768,611
|
|
|
|
880,719
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
|
|
$
|
768,611
|
|
|
$
|
1,284,406
|
|
See
accompanying Notes to Consolidated Financial Statements
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE INCOME (LOSS) YEARS ENDED MARCH 31, 2008 AND MARCH
31, 2007
|
|
|
2008
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
REVENUES
Interest and dividends
|
|
$
|
1,119
|
|
|
$
|
28,218
|
|
|
Realized
gain from sales of securities Available for
sale
|
|
|
85,459
|
|
|
|
1,351,824
|
|
|
Miscellaneous
income
|
|
|
12,094
|
|
|
|
7,222
|
|
|
TOTAL
REVENUES
|
|
|
98,672
|
|
|
|
1,387,264
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative
|
|
|
114,441
|
|
|
|
79,343
|
|
|
Interest
expense
|
|
|
0
|
|
|
|
11,778
|
|
|
TOTAL
OPERATING EXPENSES
|
|
|
114,441
|
|
|
|
91,121
|
|
|
INCOME/(LOSS)
FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
|
|
(
15,769
|
)
|
|
|
1,296,143
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION
FOR INCOME TAXES
|
|
|
0
|
|
|
|
0
|
|
|
INCOME/(LOSS)
FROM CONTINUING OPERATIONS
|
|
|
( 15,769
|
)
|
|
|
1,296,143
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS)
FROM DISCONTINUED OPERATIONS
|
|
|
( 27,477
|
)
|
|
|
( 35,322
|
)
|
|
NET
INCOME / (LOSS)
|
|
|
( 43,246
|
)
|
|
|
1,260,821
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
COMPREHENSIVE INCOME: Unrealized gain on securities
|
|
|
16,596
|
|
|
|
649,683
|
|
|
Less: reclassification
adjustment for gain included in net income
|
|
|
(
85,459
|
)
|
|
|
(1,351,824
|
)
|
|
TOTAL
OTHER COMPREHENSIVE INCOME/(LOSS)
|
|
|
(68,863
|
)
|
|
|
(
702,141
|
)
|
|
COMPREHENSIVE
INCOME
|
|
$
|
(
112,109
|
)
|
|
$
|
558,680
|
|
|
PER
SHARE DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
|
|
|
6,945,118
|
|
|
|
6,945,118
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME/LOSS PER COMMON SHARE FROM CONTINUING
OPERATIONS
|
|
$
|
(0.00
|
)
|
|
$
|
0.19
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME/(LOSS) PER COMMON SHARE FROM DISCONTINUED
OPERATIONS
|
|
|
(0.00
|
)
|
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME/LOSS PER COMMON SHARE
|
|
$
|
(0.01
|
)
|
|
$
|
0.18
|
|
See
accompanying Notes to Consolidated Financial Statements
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
STOCKHOLDERS' EQUITY YEARS ENDED MARCH 31, 2008 AND MARCH 31, 2007
BALANCE
|
|
|
Common
Stock
|
|
|
Additional
|
|
|
|
|
|
Unreal.
Gain on
|
|
|
Treasury
Stock
|
|
|
|
|
|
|
|
Shares
|
|
|
|
|
|
Paid-in
|
|
|
Accumulated
|
|
|
Sec
Avail.
|
|
|
for
Shares
|
|
|
|
|
|
|
|
Issued
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
for
sale
|
|
|
Held
|
|
|
Amount
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,970,118
|
|
|
$
|
69,701
|
|
|
$
|
8,076,340
|
|
|
$
|
(8,683,285
|
)
|
|
$
|
907,721
|
|
|
|
25,000
|
|
|
$
|
(48,438
|
)
|
|
$
|
322,039
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized
loss on securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(702,141
|
)
|
|
|
|
|
|
|
|
|
|
|
(
702,141
|
)
|
|
Net
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,260,821
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,260,821
|
|
|
BALANCE,
March 31, 2007:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,970,118
|
|
|
|
69,701
|
|
|
|
8,076,340
|
|
|
|
(7,422,464
|
)
|
|
|
205,580
|
|
|
|
25,000
|
|
|
|
(48,438
|
)
|
|
|
880,719
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized
loss on securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
68,863
|
)
|
|
|
|
|
|
|
|
|
|
|
( 68,863
|
)
|
|
Net
loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( 43,246
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( 43,246
|
)
|
|
BALANCE,
March 31, 2008:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,970,118
|
|
|
$
|
69,701
|
|
|
$
|
8,076,340
|
|
|
$
|
(7,465,710
|
)
|
|
$
|
136,717
|
|
|
|
25,000
|
|
|
$
|
(48,438
|
)
|
|
$
|
768,611
|
|
See
accompanying Notes to Consolidated Financial Statements
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH
FLOWS YEARS ENDED MARCH 31, 2008 AND MARCH 31, 2007
|
|
|
2008
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income/(loss) from continuing operations
|
|
$
|
( 15,769
|
)
|
|
$
|
1,296,143
|
|
|
Net(loss)
from discontinued operations
|
|
|
( 27,477
|
)
|
|
|
( 35,322
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
to reconcile net income/(loss) to Net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
|
Realized
gain from sales of securities available for
sale
|
|
|
85,459
|
|
|
|
1,346,238
|
|
|
Changes
in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
(Increase)
decrease in:
|
|
|
|
|
|
|
|
|
|
Accounts
receivable – related party
|
|
|
( 48,842
|
)
|
|
|
( 60
|
)
|
|
Accounts
receivable
|
|
|
( 27,461
|
)
|
|
|
0
|
|
|
Value
of marketable securities
|
|
|
( 3,997
|
)
|
|
|
(
362,335
|
)
|
|
Increase
(decrease) in:
|
|
|
|
|
|
|
|
|
|
Accounts
payable –management fees-related party
|
|
|
(
403,687
|
)
|
|
|
(
384,830
|
)
|
|
Accrued
liabilities
|
|
|
( 68,863
|
)
|
|
|
(
728,122
|
)
|
|
NET
CASH PROVIDED/(USED) FOR OPERATING ACTIVITIES
|
|
|
(
510,636
|
)
|
|
|
1,131,712
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
made evidenced by notes receivable
|
|
|
0
|
|
|
|
( 98,843
|
)
|
|
Collection
of notes receivable
|
|
|
0
|
|
|
|
202,793
|
|
|
Decrease
in non-current receivables
|
|
|
0
|
|
|
|
49,359
|
|
|
Loan
made/(paid) evidenced by notes receivable-related party
|
|
|
98,860
|
|
|
|
( 42,607
|
)
|
|
Decrease
in non-current receivables related party
|
|
|
0
|
|
|
|
45,000
|
|
|
Proceeds
from sale of securities available for sale
|
|
|
0
|
|
|
|
5,586
|
|
|
NET
CASH PROVIDED FROM INVESTING ACTIVITIES
|
|
|
98,860
|
|
|
|
161,288
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repayment
of long-term debt
|
|
|
0
|
|
|
|
(
397,348
|
)
|
|
NET
CASH (USED)/PROVIDED BY FINANCING ACTIVITIES
|
|
|
0
|
|
|
|
(
397,348
|
)
|
|
INCREASE
IN CASH
|
|
|
(
411,776
|
)
|
|
|
895,652
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
– BEGINNING OF YEAR
|
|
|
941,906
|
|
|
|
46,254
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
- END OF YEAR
|
|
$
|
530,130
|
|
|
$
|
941,906
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
PAID DURING THE PERIODS FOR:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
0
|
|
|
$
|
26,103
|
|
See
accompanying Notes to Consolidated Financial Statements
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2008 AND
2007
|
1.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
Outlook
– As of March 31, 2008, the Company had no continuing
business operations. Any perceived value in the Company is
both speculative and intangible in nature. The Company is
operating as a public shell and its business operations consist of management
seeking merger and acquisition candidates with ongoing operations and the
collection of receivables from its discontinued operations.
Cash
totaled $530,130 at March 31, 2008. The Company had nominal revenues
from continuing operations for the year ended March 31,
2008. The Company’s cash will be used to fund
operations.
The
Company’s consolidated financial statements have been prepared assuming
the Company will continue as a going concern, which contemplates the
realization of assets and satisfaction of liabilities in the normal
course of business.
Ultimately,
the Company’s ability to continue as a going concern is
dependent upon it’s ability to attract new sources of capital,
establish an acquisition or reverse merger candidate with continuing
operations, attain a reasonable threshold of operating efficiencies, and achieve
profitable continuing operations.
The
Company is seeking to acquire businesses and may be in various
stages of negotiations at any point in
time which may or may not result in
consummation of a transaction. To provide funding for such
acquisitions it may take a number of actions including (i) selling of its
existing investments (ii) use of
available working capital (iii) seeking
short or long term loans (iv) issuing stock. In
addition, the Company may
seek additional equity funds if needed. These
sources of capital may be both conventional and non- traditional.
The Company has
no existing funding commitments and
is presently under no contractual obligation to make any
investment or acquisition.
Current
Accounting Pronouncements
– In December 2007, the FASB issued SFAS No.
141 (revised 2007),
Business
Combinations
(“SFAS No. 141R”), which revises current purchase accounting
guidance in SFAS No. 141,
Business
Combinations
. SFAS No. 141R requires most assets acquired and
liabilities assumed in a business combination to be measured at their fair
values as of the date of acquisition. SFAS No. 141R also modifies the
initial measurement and subsequent re-measurement of contingent consideration
and acquired contingencies, and requires that acquisition related costs be
recognized as expense as incurred rather than capitalized as part of the cost of
the acquisition. SFAS No. 141R is effective for fiscal years beginning after
December 15, 2008 (the Company’s fiscal 2009) and is to be applied
prospectively to business combinations occurring after adoption. The
impact of SFAS No. 141R on the Company’s consolidated financial statements will
depend on the nature and extent of the Company’s future acquisition
activities.
In
February 2007, the FASB issued SFAS No. 159, “
The Fair Value Option for Financial
Assets and Liabilities
”. This Statement permits entities to
choose to measure many financial instruments and certain other items
at fair value. The objective is to improve financial
reporting by providing entities with the opportunity to mitigate volatility
in reported earnings caused by measuring related assets and
liabilities different without having to apply complex hedge
accounting provisions. The fair value option
established by this Statement permits all entities to choose to
measure eligible items at fair value at specified election
dates. A business entity shall report unrealized gains and
losses on items for which the fair value option has been elected in
earnings (or another performance indicator if the business entity does not
report earnings) at each subsequent reporting date. This Statement is
effective as of the beginning of an entity’s first fiscal year that
begins after November 15, 2007. The Company does not believe that the
adoption of SFAS 159 will have a material affect on our financial
statements.
In
September 2006, the FASB issued SFAS No. 157,
Fair Value Measurements
,
which establishes a standard definition for fair value, provides a
framework under generally accepted accounting principles for measuring fair
value, and expands disclosure requirements for fair
value measurements. FASB Staff Position (“FSP”) No. FAS
157-b,
Effective Date of FASB
No 157
, issued in December 2007, delays the effective date of
SFAS No. 157 to annual reporting periods beginning after November 15,
2008 for all non-financial assets and non-financial liabilities, except those
that are recognized or disclosed at fair market value in the financials
statements on a recurring basis. The remaining provisions
of SFAS No. 157 are effective for annual reporting periods beginning
after November 15, 2007. The adoption of SFAS No. 157
may require increased disclosures in the Company’s consolidated
financial statements.
In
December 2007, the FASB issued SFAS No. 160, “
Noncontrolling Interests in
Consolidated Financial Statements”
. This Statement
amends ARB 51 to establish accounting and reporting standards for the
noncontrolling interest in a subsidiary and for the deconsolidation
of a subsidiary. It clarifies that a noncontrolling
interest in a subsidiary is an ownership interest in the consolidated
entity that should be reported as equity in the consolidated
financial statements. This Statement changes the way the
consolidated income statement is presented. It requires consolidated
net income to be reported at
amounts
that include the amounts attributable to both the parent and
the noncontrolling interest. It also requires disclosure, on the face
of the consolidated statement of income, of the amounts of
consolidated net income attributable to the parent and to the
noncontrolling interest. The adoption of SFAS No. 160 may require
increased disclosures in the Company’s consolidated financial
statements.
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS MARCH 31, 2008 AND 2007
Description of the Business
- T.H. Lehman &
Co., Incorporated, a Delaware corporation, had provided medical business
management services including billing and collection in California through one
of its wholly-owned subsidiaries.
During
June 2004 the management of the Company decided to disengage itself from the
medical business management segment of its business. This was the
only significant operation of the Company. Management
based its decision in part on the expected negative impact of California’s new
workers’ compensation legislation on the medical providers that the
Company manages. Therefore the remaining medical business
management operations are reflected on the statement of operations as
discontinued operations.
The
Company wound down its medical business management office in February 2005, the
date its medical office lease expired. In February 2005 the Company
had closed all its patients’ cases and final billed all the services
rendered by the providers, and, for the patients that could not be
finalized, referred them to other providers, but billed through the
date that the providers had rendered services. The Company
has engaged a consultant to follow up on collections for all its
receivables that have been assigned to the medical business
management entity. The collection of these receivables is
significantly complete. The Company does not expect
significant collections nor incurring significant costs on the
remaining provider receivables that it
manages. The valuation of the existing receivables as of
March 31, 2008, after taking into consideration the expected future
collection costs, is zero.
There
were no long-lived assets related to the discontinued operation, nor
are there expected to be gains or losses from the discontinuance of
the medical business management segment.
Principles of
Consolidation
- The consolidated financial statements include the
accounts of the Company and its wholly-owned
and majority-owned subsidiaries.
All intercompany balances and transactions have been eliminated.
Use of Estimates
-
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires estimates
and assumptions that affect the reported amounts of assets
and liabilities, the disclosure of contingent assets and liabilities
at the date of the financial statements, and revenues and expenses during the
period reported. Actual results could differ from those
estimates. Estimates are used when accounting for stock-based
transactions, uncollectible accounts receivable, asset depreciation
and amortization, and taxes, among others.
Cash
–
Not all cash is covered by the
FDIC. Extra insurance has not been obtained.
Securities
-
Marketable securities that are bought and held principally for the
purpose of selling them in the near term are
classified as trading securities
and reported at fair value, with unrealized gains and
losses included in earnings. Marketable securities not
classified as either investment securities (which are held to
maturity) or trading securities are classified as securities
available for sale and reported at fair value, with unrealized gains
and losses
affecting comprehensive income and reported in a separate component of
stockholders' equity. Average cost is used to
determine cost when calculating
realized gains or losses from sales of securities available for sale.
Investment in 50% owned Corporation
- Investment in 50% owned corporation is
accounted for under the equity method. Currently this
investment is carried at no value.
Receivables
- Assigned medical billings represented the contractual percentage of medical
provider receivables of medical practices to which the Company provided
management services. Revenues were recognized when the medical services were
provided, according to the contractual percentage after uncollectible
allowances.
Stock-Based
Compensation
- There are no employee stock
options.
Basic
Income/Loss Per Share
- Basic income/loss per common
share is calculated by dividing earnings available to common
stockholders by the weighted average number of common shares outstanding during
the period.
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS MARCH 31, 2008 AND 2007
|
2.
|
NON-CONSOLIDATED
ENTITY
|
In a
transaction that was effective October 1, 1996, the Company transferred 50%
of the outstanding stock and substantially
all of the control of Healthcare
Professional Billing Corp.("HPB") to certain
key employees of HPB. Until that
time, HPB was a wholly-owned subsidiary
of the Company. As a result of the
transfer, the subsidiary's financial position,
results of operations and cash flows are not consolidated
with that of the Company subsequent to the transfer
date. The summarized unaudited financial
information of HPB at March 31, 2008
and March 31, 2007 is as follows:
|
|
|
March 31,
2008
|
|
|
March 31,2007
|
|
|
Financial
Position:
|
|
|
|
|
|
|
|
Current
Assets
|
|
$
|
65,581
|
|
|
$
|
78,048
|
|
|
Property
and equipment
|
|
|
0
|
|
|
|
0
|
|
|
Total
assets
|
|
$
|
65,581
|
|
|
$
|
78,048
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities(including due to the Company of
$71,554)
|
|
$
|
217,872
|
|
|
$
|
217,893
|
|
|
Long-term
obligations
|
|
|
56,518
|
|
|
|
89,084
|
|
|
Stockholders'
deficiency
|
|
|
( 208,809
|
)
|
|
|
( 228,929
|
)
|
|
Total
liabilities and stockholders' deficiency
|
|
$
|
65,581
|
|
|
$
|
78,048
|
|
|
|
|
|
|
|
|
|
|
|
|
Results
of Operations: Revenues
|
|
$
|
282,986
|
|
|
$
|
290,944
|
|
|
Operating
Expenses
|
|
|
262,866
|
|
|
|
297,274
|
|
|
Net
loss
|
|
$
|
20,120
|
|
|
$
|
( 6,330
|
)
|
Under the 1996 transaction
the Company and/or related entities of the Company
are to receive 90% of HPB's net income as
defined, until the advances made by the Company and/or
related entities of the Company have been paid. The Company,
with the concurrence of the related entities of
the Company, has elected that its advances (non-interest
bearing) are to be liquidated, in most part, before
the other related entities. The
remaining outstanding due from HPB to the Company is $71,554
although fully reserved by the Company. During the year
ended March 31, 2008 and 2007 the Company received $12,093 and
$7,162, respectively from HPB.
|
3.
|
SECURITIES
AVAILABLE FOR SALE
|
|
|
|
2008
|
|
|
2007
|
|
|
KSW,
Inc.
|
|
$
|
162,118
|
|
|
$
|
243,580
|
|
Unrealized
gains and losses for marketable equity securities available for
sale at March 31, 2008 and 2007 are as follows:
|
|
|
2008
|
|
|
2007
|
|
|
|
|
Current
|
|
|
Non-Current
|
|
|
Current
|
|
|
Non-Current
|
|
|
Aggregate
Cost
|
|
$
|
0
|
|
|
$
|
25,400
|
|
|
$
|
0
|
|
|
$
|
38,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate
Market Value
|
|
|
0
|
|
|
|
162,117
|
|
|
|
0
|
|
|
|
243,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Unrealized Gains
|
|
$
|
0
|
|
|
$
|
136,717
|
|
|
$
|
0
|
|
|
$
|
205,580
|
|
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS MARCH 31, 2008 AND 2007
|
4.
|
NON-CURRENT
RECEIVABLES (DISCONTINUED
OPERATIONS)
|
|
|
|
2008
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
Assigned
medical billings net of allowances of which $0 of the unpaid balance are
expected to be collected during the current fiscal year.
|
|
$
|
1,059,166
|
|
|
$
|
1,080,581
|
|
|
|
|
|
|
|
|
|
|
|
|
Working
capital advances at 12% per annum interest to a provider of medical
services who has contracted with the Company to provide management
services. None of these advances are expected to be collected during the
current fiscal year, nor is interest being accrued.
|
|
|
1,037,530
|
|
|
|
1,037,530
|
|
|
|
|
|
2,096,696
|
|
|
|
2,118,111
|
|
|
Less
Allowance for Uncollectible
|
|
|
(2,096,696
|
)
|
|
|
(2,118,111
|
)
|
|
|
|
|
0
|
|
|
|
0
|
|
|
Less
Current Portion
|
|
|
0
|
|
|
|
0
|
|
|
|
|
$
|
0
|
|
|
$
|
0
|
|
The
above receivable balances have been reduced to reflect estimated
cost associated with their collections.
At March
31, 2008, for income tax reporting purposes, the Company has a consolidated net
operating loss carryforward of approximately $4,800,000 available to reduce
future taxable income, if any, expiring through 2024. As a result of a 51%
change in ownership in a prior year, certain of the net operating loss will be
subject to an annual limitation and may not be fully utilized in any one year.
Because of a history of losses, the estimate for future tax benefits has been
offset by an equal asset valuation allowance.
|
6.
|
COMMITMENTS
AND CONTINGENCIES
|
Leases -
The Company currently leases an office in Sherman Oaks, California on a
month-to-month basis for collection of receivables and file storage purposes.
The monthly rental is $695. The lease will end as of June 30, 2008.
Rent
expense for discontinued operations amounted to $10,705 and $10,746 for
the years ended March 31, 2008 and 2007, respectively.
|
7.
|
RELATED PARTY TRANSACTIONS
|
The
Company has its corporate headquarters in Houston, Texas, where it shares office
space and personnel with an entity for which a principal stockholder of the
Company serves as an unpaid consultant. The Company has entered into agreements
with this entity whereby that entity will provide various accounting,
administrative and managerial services for the Company and certain of its
subsidiaries for stipulated monthly fees. The agreements are for 12 months and
they automatically renew for an additional 12 month period if not terminated
within 60 days of the end of the current term. The Company incurred fees to this
entity under the agreements totaling $49,358 and $49,358 for the years ended
March 31, 2008 and 2007, respectively.
Certain of the
Company's creditors are related as a result of one
of the Company's principal stockholders being a
consultant to these entities.
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: June
25, 2008
|
|
T.H.
LEHMAN & CO., INCORPORATED AND SUBSIDIARIES
|
|
|
|
|
|
|
By:
|
/s/
Raffaele Attar
|
|
|
|
Raffaele
Attar
|
|
|
|
Acting
Chairman and
|
|
|
|
Chief
Executive Officer
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/
Gary Poe
|
|
|
|
Gary
Poe
|
|
|
|
Principal
Financial Officer
|
|
|
|
and
Secretary
|
TH Leman (CE) (USOTC:THLM)
과거 데이터 주식 차트
부터 1월(1) 2025 으로 2월(2) 2025
TH Leman (CE) (USOTC:THLM)
과거 데이터 주식 차트
부터 2월(2) 2024 으로 2월(2) 2025
