SEC Info - Mark Solutions Inc - ‘10-Q’ for 12/31/02

SEC Info℠

Home

Help

Please Sign In

Mark Solutions Inc – ‘10-Q’ for 12/31/02

On: Wednesday, 2/19/03, at 5:12pm ET · For: 12/31/02 · Accession #: 1012118-3-21 · File #: 0-17118

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 2/19/03  Mark Solutions Inc                10-Q       12/31/02    1:30K                                    McLaughlin & Ste… LLP/FA

Quarterly Report — Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        10-Q for Period Ended 12-31-02                        15     65K

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Certifications Changes In Securities and Use Of Proceeds Controls and Procedures Defaults Upon Senior Securities Exhibits and Reports on Form 8-K Financial Statements Legal Proceedings Management's Discussion and Analysis of Financial Condition and Results of Operations Other Information Quantitative and Qualitative Disclosures About Market Risks Signatures Submission of Matters to a vote of Security Holders
1	1st Page - Filing Submission
2	Item 1. Financial Statements
"	Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
"	Item 2. Changes In Securities and Use Of Proceeds
"	Item 3. Defaults Upon Senior Securities
"	Item 6. Exhibits and Reports on Form 8-K
"	Signatures
10	Item 3. Quantitative and Qualitative Disclosures About Market Risks
"	Item 4. Controls and Procedures
12	Item 1. Legal Proceedings
"	Item 4. Submission of Matters to a vote of Security Holders
"	Item 5. Other Information
14	Certifications

10-Q 1st Page of 15 TOC ↑Top Previous Next ↓Bottom Just 1st
 
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:         December 31, 2002                       
               -------------------

Commission File Number:                       0-17118                           
                    ----------------------------------

Mark Holdings, Inc.             
-----------------------------------------------------------------               
(Exact Name of Registrant as Specified in Its Charter)              

Delaware                                                     01-0564816         
------------                                          -----------------------   
(State or Other Jurisdiction                              (I.R.S. Employer      
of Incorporation)                                    Identification No.)

1135 Clifton Avenue                                                             
Clifton,  New Jersey                                           07013            
---------------------------------------------------------------------           
(Address of Principal Executive Offices)                   (Zip Code)           

Registrant's Telephone Number, Including Area Code:      (973) 773-8100         
                                                ------------------------------

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Indicate by check whether 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 registrant was required to 
file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes X  No ---                                                     
--                                                                    

APPLICABLE ONLY TO CORPORATE ISSUERS:         

Indicate the number of shares outstanding of each of the issuer's classes of    
Common Stock, as of the latest practicable date:                                

Common Stock,$.01 par value:9,714,606 shares outstanding as of February 10,2003.

10-Q 2nd Page of 15 TOC 1st Previous Next ↓Bottom Just 2nd
MARK HOLDINGS, INC. 
Form 10-Q     
for     
 Quarter Ended December 31, 2002

Index     

Part I.             Financial Information                               Page No.

Item 1. Financial Statements                                                    

Consolidated Balance Sheets as of                               
December 31, 2002 and June 30, 2002 . . . . . . . . . . . . . 3 

Consolidated Statements of Operations                           
for the Six and Three Months Ended                              
December 31, 2002 and 2001   . . . . . . . . . . . . . . . . .4 

Consolidated Statements of Cash Flow                            
for the Six Months Ended December 31,                           
2002 and 2001  . . . . . . . . . . . . . . . . . . . . . . . .5 

Notes to Consolidated Financial Statements . . . . . . . . .6-7 

Item 2. Management's Discussion and Analysis of                                 
Financial Condition and Results of Operations. . . . . . . 8-10 

Item 3. Quantitative and Qualitative Disclosures About                          
Market Risks . . . . . . . . . . . . . . . . . . . . . . . . 10 

Item 4. Controls and Procedures . . . . . . . . . . . . . . . . . . .10         

Part II.             Other Information                                          

Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . .12         

Item 2. Changes in Securities and Use of Proceeds. . . . . . . . . . 12         

Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . . . 12         

Item 4. Submission of Matters to a vote of Security Holders . . . . .12         

Item 5. Other Information . . . . . . . . . . . . . . . . . . . . . .12         

Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . .12         

Signatures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13         

Certifications . . . . . . . . . . . . . . . . . . . . . . . . . .14-15         

-2-         

10-Q 3rd Page of 15 TOC 1st Previous Next ↓Bottom Just 3rd
Part I.               Financial Information                                     

MARK HOLDINGS, INC. AND SUBSIDIARIES        
CONSOLIDATED BALANCE SHEETS         
(in thousands)          

                                          December 31, 2002      June 30, 2002
ASSETS                                         (Unaudited)                      

CURRENT ASSETS:                                                                 
Cash and cash equivalents                    $     5            $   156       
Notes receivable                                  71                 71       
Accounts receivable                            1,184              2,028       
Costs in excess of contract revenue recognized     8                323       
Inventories                                       25                 25       
Prepaid expenses                                  25                 74       
                                       --------            -------
Total Current Assets                         1,318              2,677     
                                       --------            -------
PROPERTY AND EQUIPMENT, NET:                      158                297        

OTHER ASSETS                                       36                 36        
                                       --------             ------
Total Assets                                   $1,512             $3,010        
                                       ========            =======

LIABILITIES AND STOCKHOLDERS' EQUITY                                            

CURRENT LIABILITIES:                                                            
Accounts payable                               $1,271             $1,088        
Current portion of long-term debt                 268                268        
Current portion of obligations under                                            
capital leases                                    11                 13       
Billings in excess of costs and estimated                                       
earnings on uncompleted contracts                 94                 89       
Accrued liabilities                               444                381        
                                        -------            -------
Total Current Liabilities                    2,088              1,839     
                                        -------            -------
OTHER LIABILITIES:                                                              
Long-term portion of obligations under                                          
capital leases                                   17                 20      
                                        -------            -------
Total Other Liabilities                         17                 20     
                                        -------            -------
COMMITMENTS AND CONTINGENCIES                                                   

STOCKHOLDERS' EQUITY:                                                           
Common stock, $.01 par value, 100,000,000                                       
shares authorized, 9,714,606 shares issued                                  
and outstanding                                  97                97       
Preferred stock, $1.00 par value, $10                                           
liquidation value; 5,000,000 shares                                         
authorized:                                                                 
Additional paid-in capital                     36,881            36,881         
Deficit                                       (37,520)          (35,776)        
Treasury stock, at cost; 17,500 shares            (51)              (51)        
                                       -------           -------
Total Stockholders' Equity                    (593)            1,151      
                                        -------           --------
Total Liabilities and Stockholders' Equity     $1,512            $3,010         
                                       =======           =======

-3-         

10-Q 4th Page of 15 TOC 1st Previous Next ↓Bottom Just 4th
                                      MARK HOLDINGS, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                                    (In thousands)

                                                        [Enlarge/Download Table]


                              Six Months Ended   Six Months Ended   Three Months Ended  Three Months Ended
                              December 31, 2002  December 31, 2001  December 31, 2002   December 31, 2001 

                                                                                                          
Revenues                      $   1,234             $   5,447             $  225        $   2,155         
                              ---------              --------             ------         ---------        
Costs and Expenses:                                                                                       
Cost of sales                     2,192                 3,422              1,195            1,259         
General and administrative                                                                                
 expenses                           775                 1,290                401              665         
                                --------               -------             ------           ------        
Total Costs and Expenses          2,967                 4,712              1,596            1,924         
                                ========                ======             ======           ======        
Operating (Loss)/Income          (1,733)                  735             (1,371)             231         
                                --------                ------             ------           ------        
Other Income (Expenses):                                                                                  
Interest income                    -                       15                 -                 7         
Interest expense                    (11)                  (44)                (6)              (5)        
                                --------                 -----             ------           -------       
Total Other Expenses                (11)                  (29)                (6)               2         
                                ========                 ======            =======           ======       
(Loss) Income from Continuing                                                                             
  Operations before                                                                                       
  extraordinary gain and                                                                                  
  income tax                     (1,744)                  706            (1,377)              233         

Income tax                          -                      -                 -                 -          
                                --------                 -----            ------              ----        
(Loss) Income from                                                                                        
  Continuing Operations                                                                                   
  before extraordinary gain      (1,744)                  706            (1,377)              233         

Discontinued Operations:                                                                                  
  Loss from sale of                                                                                       
  discontinued segment              -                    (200)              -                (200)        

Extraordinary gain on                                                                                     
  extinguishment of debt            -                   1,121               -                  -          
                                 ------                 ------            ------             ------       

Net (Loss)/Income               $(1,744)             $  1,627            $(1,377)           $  33         
                                ========              ========            =======            ======       

Basic Income (Loss) per Share                                                                             
Income (loss) per share from                                                                              
  continuing operations          $(0.18)                $0.07            $(0.14)               $0.02      
(Loss) income from sale of                                                                                
  discontinued segment              -                   (0.02)               -                 (0.02)     
Extraordinary gain on                                                                                     
  extinguishment of debt            -                    0.12                -                    -       
                                --------               -------            -------               -----     
Income (loss) per share          $(0.18)                $0.17            $(0.14)             $  0.00      
                                ========               =======            =======             =======     
Fully Diluted (Loss)/Income                                                                               
  per Share                                                                                               
(Loss)/income per share from                                                                              
  continuing operations          $(0.18)                $0.07            $(0.14)               $0.02      
(Loss) from sale of                                                                                       
  discontinued segment              -                   (0.02)               -                 (0.02)     
Extraordinary gain on                                                                                     
  extinguishment of debt            -                    0.12                -                    -       
                                --------                ------           --------               ------    
(Loss)/income per share          $(0.18)                $0.17            $(0.14)                $ -       
                                ========                ======           ========               ======    

Weighted Average Number of                                                                                
  Basic Shares Outstanding     9,697,106            9,697,106         9,697,106              9,697,106    
                               =========            ==========        =========              =========    
Weighted Average Number of                                                                                
  Fully Diluted Shares                                                                                    
  Outstanding                  9,697,106            9,697,106         9,697,106              9,697,106    
                               =========            ==========        =========              =========    
Dividends Paid                 $   -                $   -              $  -                   $   -       
                               =========            ==========        =========               ========    

                                                 -4-

10-Q 5th Page of 15 TOC 1st Previous Next ↓Bottom Just 5th
MARK HOLDINGS, INC. AND SUBSIDIARIES  
CONSOLIDTED STATEMENTS OF CASH FLOWS  
(UNAUDITED)     
(in thousands)    

                                        Six Months Ended      Six Months Ended
                                         December 31, 2002     December 31, 2001
                                         -----------------     -----------------

Cash Flows From Operating                                                       
Activities:                                                                 
Net (loss) income                           $   (1,744)          $  1,627       
Adjustments to reconcile net (loss)                                             
income to net cash (used for) provided                                      
by operating activities:                                                    
Depreciation and amortization                  139                144   
Allowance for notes receivable                  -                 200   
Gain on  extinguishment of debt                  -              (1,121)   
Deferred tax asset                               -                 198    
(Increase) decrease in assets:                                            
Accounts receivable                                844                897       
Billing in excess of contract revenue                                           
recognized                                       315                270     
Other current assets                                49                (24)      
Increase (decrease) in liabilities:                                             
Accounts payable                                   183             (1,069)      
Billings in excess of contract revenue earned        5               (111)      
Accrued liabilities                                 63               (196)      
                                           -------            --------
Net adjustments to reconcile net (loss) income                                  
to net cash (used for) provided by operating                                
activities                                     1,598               (812)    
                                           -------             -------
Net Cash (Used for) Provided by Operating                                       
Activities                                      (146)               815     
                                           -------             -------
Cash Flows From Investing Activities:                                           
Acquisition of property and equipment               -                 (17)      
Repayment of note receivable                        -                  42       
Note receivable                                     -                (330)      
                                           -------             -------
Net Cash (Used For)  by Investing Activities        -                (305)      
                                           -------             -------
Cash Flows From Financing Activities:                                           
Repayment of convertible debt                       -                (500)      
Repayment of notes payable for equipment                                        
and vehicles                                      (5)               (41)    
Notes payable officer/ shareholder                  -                 (97)      
                                            -------             --------
Net Cash Used for Financing Activities              (5)              (638)      
                                            -------             --------
Net decrease  in Cash                             (151)              (128)      
Cash and Cash Equivalents at Beginning of                                       
Period                                            156                536      
                                            -------              -------
Cash and Cash Equivalents at End of Period       $   5            $   408       
                                            =======           ==========

-5-       

10-Q 6th Page of 15 TOC 1st Previous Next ↓Bottom Just 6th
MARK HOLDINGS, INC. AND SUBSIDIARY                            
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                            

Note 1    INTERIM FINANCIAL INFORMATION                                         

                The consolidated balance sheet of the Company as of December
               31, 2002, the consolidated statements of operations for the
                 six and three months ended December 31, 2002 and 2001 and the
                 consolidated statements of cash flow for the six months ended
          December 31, 2002 and 2001 are unaudited and have been
             prepared in accordance with generally accepted accounting
             principles for interim financial information and with the
                  instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In
              the opinion of management, all adjustments (which included
               only normal recurring accruals) necessary to present fairly
                the financial position, results of operations and cash flows
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.
            The June 30, 2002 balance sheet data is derived from the
           audited consolidated financial statements. The attached
              financial statements should be read in connection with the
                  consolidated financial statements and notes hereto included in
               the Company's Annual Report on Form 10-K for the year ended
June 30, 2002.                              

               Certain reclassifications have been made to the current and
        prior years amounts to conform to the current period
presentation.                               

Note 2    COMMON STOCK AND ADDITIONAL PAID-IN-CAPITAL                           

                  Basic earnings (loss) per common share is computed by dividing
               the net earning by the weighted average number of shares of
                 common stock outstanding during the period. Dilutive earnings
                  per share gives effect to stock options and warrants which are
 considered to be dilutive common equivalents.

Note 3    CONVERTIBLE NOTES PAYABLE                                             

            In September 2001, the Company entered into a compromise
                 agreement with the holder of the convertible notes payable in
                  the amount of $1,880,000. Under the terms of the agreement the
           Company will pay $1,000,000 in full satisfaction of the
                 outstanding indebtedness and accrued interest. The compromise
                amount is payable In four (4) equal installments of $250,000
               due upon the execution of the agreement, November 30, 2001,
                 February 28, 2002 and March 1, 2003. The first three payments
                 were made in September 2001, November 2001 and February 2002.
                  It is questionable whether the Company will have the financial
               resources to make the March 1, 2003 payment and if not, the
                  Company will seek an extension of time to make the payment. As
               a result of this transaction the Company realized a gain of
$1,069,000 from the extinguishment of debt. 

Note 4     PROPOSED SALES OF ASSETS                                             

           In February 2002 the Company entered into a non-binding
                 agreement to sell substantially all of the net assets of Mark
                 Correctional Systems ("Mark Correctional"), our modular steel
                 cell division, to Rite-Way of New Jersey, a corporation owned
               by the Company's Executive Vice President. The agreement by
its terms automatically                     

       -6-

10-Q 7th Page of 15 TOC 1st Previous Next ↓Bottom Just 7th
              terminated on September 30, 2002 but the parties agreed to
              reinstate the agreement. The consideration will consist of
                  $2,500,000 based on an estimated book value of the assets. Any
            shortfall in the value of the assets will be adjusted at
                  closing. Payment shall consist of $500,000 cash at closing and
         the balance of $2,000,000 payable in 36 equal monthly
               installments evidenced by a secured promissory note bearing
                interest at 8% per annum. The Company will also receive cash
                  on hand and/ or a short-term promissory note for a total of an
              additional $1,000,000. Completion of the sale is dependent
            upon shareholder approval. The carrying value of the net
            assets of the Correctional division at December 31, 2002
consists of the following:                  

Cash                                                   $   5,000                
Accounts Receivable                                    1,184,000                
Costs in excess of contract revenue earned                 8,000                
Inventories                                               25,000                
Property and equipment, net                              133,000                
Other assets                                              36,000                
Accounts payable                                      (1,011,000)               
Obligations under capital leases                         (11,000)               
Billings in excess of contract revenues earned           (94,000)               
Accrued liabilities                                      (74,000)               
Long-term debt                                           (17,000)               
                                         -----------
                                       $ 184,000

The closing of this  transaction is subject to the purchaser  completing its due
diligence to determine if there have been any material  changes in the financial
condition of the jail cell business.  If there have been any such changes, the  
purchaser can elect not to close the transaction.                               

 -7-

10-Q 8th Page of 15 TOC 1st Previous Next ↓Bottom Just 8th
Item 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND   
RESULTS OF OPERATIONS                               

General                                                                         

Mark Holdings, Inc. ("Mark" or "The Company" or "We") is a Delaware corporation,
which  operates  its  only  business  through  a  division  of  a  wholly  owned
subsidiary,  Mark Solutions,  Inc. ("Mark Solutions").  The division is known as
Mark Correctional Systems.                                                      

       The business consists of the design, manufacture, and installation of
modular steel jail cells for correctional institution construction. We market   
our modular steel products by responding to public bids and by pursuing joint   
ventures and affiliations with other companies to solicit design/build          
correctional facilities.                                                        

    We have recently entered into an agreement to sell our jail cell
manufacturing business. The sale of the business was subject to approval by     
shareholders. A meeting of shareholders was held on December 20, 2002. On       
January 6, 2003 shareholders holding 5,041,759 shares of the Company's Common   
Stock approved the sale of the assets of the Company's jail cell division, Mark 
Correctional Division. Holders of 689,270 shares voted against the proposal.    
Accordingly, the Company had received the requisite majority for approval by    
shareholders of the sale of the assets of the jail cell division. The closing of
this transaction is subject to the purchaser completing its due diligence to    
determine if there have been any material changes in the financial  condition of
the jail cell business.  If there have been any such changes,  the purchaser can
elect not to close the  transaction.  IN such an event the  Company  would  then
attempt to sell off the asets. If the sale is consummated,  we will  essentially
be a non-  operating  "shell." Our objective is to acquire  another  business or
merge with another  company;  however there can be no assurances that we will be
successful. See footnotes to Consolidated Financial Statements.                 

 -8-

10-Q 9th Page of 15 TOC 1st Previous Next ↓Bottom Just 9th
Results of Operations                                                           

       Revenues from continuing operations for the six months ended December
31, 2002, decreased 77% to $1,234,000 from $5,447,000 for the comparable period.
This decrease is attributable to fewer active modular steel cell projects       
because we submitted fewer bids and a general slow down in the industry.        

 Revenues from continuing operations, for the three months ended
December 31, 2002, decreased 90% to $225,000 from $2,155,000. This decrease is  
also attributable to fewer active modular steel cell projects because we        
submitted fewer bids and encountered a general slow down in the industry.       

   Cost of sales from continuing operations for the six months ended
December 31, 2002, consisting of materials, subcontractor fees, labor and fixed 
factory overhead expense decreased to $2,192,000 from $3,422,000 for the        
comparable period. Cost of sales as a percentage of revenues was 177.6% for the 
six months ended December 31, 2002 as compared to 62.8% for the prior comparable
period. The increase of cost of sales as a percentage of sales reflects the     
under-utilization of overhead resulting from lower production activity. In      
addition, the late delivery of product resulting from a downturn in the economy 
increased cost of procurement, manufacture and onsite work.                     

     Cost of sales from continuing operations for the three months ended
December 31, 2002, consisting of materials, subcontractor fees, labor and fixed 
factory overhead expense decreased to $1,195,000 from $1,259,000 for the        
comparable period. Cost of sales as a percentage of revenues was 531.1% for the 
three months ended December 31, 2002 as compared to 58.4% for the prior         
comparable period. The increase of cost of sales as a percentage of sales also  
reflects the under-utilization of overhead resulting from lower production      
activity. In addition, the late delivery of product resulting from a downturn in
the economy increased cost of procurement, manufacture and onsite work.         

        General and administrative expenses from continuing operations for the
six months ended December 31, 2002, decreased to $775,000 from $1,290,000 for   
the comparable period. This decrease reflects the Company's efforts to control  
costs by virtue of a reduction of administrative personnel, advertising and     
marketing costs, as well as travel related expenses.                            

  General and administrative expenses from continuing operations for the
three months ended December 31, 2002, decreased to $401,000 from $665,000 for   
the comparable period. This decrease reflects the Company's efforts to control  
costs by virtue of a reduction of administrative personnel, advertising and     
marketing costs, as well as travel related expenses.                            

Liquidity and Capital Resources                                                 

      The Company entered into an Asset Purchase Agreement on April 4,
2002, the terms of which provide that the Company will sell its jail cell       
manufacturing business to Rite-Way of New Jersey, Inc., a privately held        
company. The Agreement expired by its terms. The Company and the proposed buyer 
Rite-Way thereafter revived the Agreement. The sale was approved of shareholders
at the Annual Meeting of Shareholders held on December 20, 2002.                

        Under the terms of the Agreement, the purchase price is $2,500,000
subject to valuation of the net assets at time of closing. At closing we will   
receive a $500,000 down payment, cash on hand in the Mark Correctional Division 
of at least $500,000 up to a minimum of $1,000,000 and the balance in 36 equal  
monthly installments together with interest. If there is a cash shortfall at    
closing, we will receive a 90-day note from Rite-Way for the difference between 
the actual cash on hand we receive and $1,000,000. We are therefore entitled to 
receive in total $3,500,000 subject to adjustment of the net book value at the  
time of closing. However, the net book value of the assets as of December 31,   
2002 was                                                                        

-9-         

10-Q 10th Page of 15 TOC 1st Previous Next ↓Bottom Just 10th
$184,000 and accordingly the Company anticipates receiving $1,184,000 as the    
total purchase price. The Company will use the proceeds of the sale to acquire  
another business or enter into a business combination with another company.     
Accordingly, we are unable to predict what our working capital requirements will
be under those circumstances.                                                   

     If the sale is not consummated, we will consider our options of
whether to continue the business or close the business by completing our current
backlog and disposing of our fixed assets in private sales and satisfying our   
contractual obligations. If we elect to continue the business, we will require  
additional capital for which we would principally look to private sources in the
form of debt or equity financing since our present cash flow would be inadequate
to enable us to take on any significant contracts.                              

It is questionable whether the Company will have the financial
resources to make the March 1, 2003 payment of the compromise agreement and if  
not, the Company will seek an extension of time to make the payment.            

         When the sale is finalized, the Company will have no operating business
and it will essentially be a "shell." Management's intention is to acquire      
another business or merge with another company.                                 

       At the current time, we are looking at other companies for a possible
acquisition or merger. Management has had only very preliminary conversations   
with representatives from other companies. Nothing of any definitive nature has 
developed from these preliminary conversations.                                 

ITEM 3.           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS   

Not Applicable.                                               

ITEM 4.     CONTROLS AND PROCEDURES                                             

     Under the supervision and with the participation of our management,
including our principal executive and financial officer, we have evaluated the  
effectiveness of the design and operation of our disclosure controls and        
procedures within 90 days of the filing date of this quarterly report, and,     
based on their evaluation, our principal executive and financial officer has    
concluded that these controls and procedures are effective. There were no       
significant changes in our internal controls or in other factors that could     
significantly affect these controls subsequent to the date of their evaluation. 

Disclosure controls and procedures are our controls and other 
procedures that are designed to ensure that information required to be disclosed
by us in the reports that we file or submit under the Exchange Act is recorded, 
processed, summarized and reported, within the time periods specified in the    
Securities and Exchange Commission's rules and forms. Disclosure controls and   
procedures include, without limitation, controls and procedures designed to     
ensure that information required to be disclosed by us in the reports that we   
file under the Exchange Act is accumulated and communicated to our management,  
including our principal executive and financial officer, as appropriate to allow
timely decisions regarding required disclosure.                                 

-10-  

10-Q 11th Page of 15 TOC 1st Previous Next ↓Bottom Just 11th
Forward Looking Statements                                                      

     Except for the historical information contained herein, the matters
discussed in this report are forward looking statements under the federal       
securities law. These statements are based on current plans and expectations of 
the Company and involve risks and uncertainties that could cause actual future  
activities and results of operations to be materially different from those set  
forth in the forward-looking statements. Important factors that could cause     
actual results to differ include whether cell projects are awarded to us, and   
the timing of their completion, meeting current and future financial            
requirements and competition.                                                   

-11-    

10-Q 12th Page of 15 TOC 1st Previous Next ↓Bottom Just 12th
PART II   OTHER INFORMATION                                                     

Item 1.   Legal Proceedings                                                     

On June 28, 2001, the Company was scheduled to receive the final  
installment of the payment for the sale of the assets of MarkCare Medical       
Systems segments from MMSI Acquisition Corp. ("MMSI"). The final installment was
evidenced by a $500,000 promissory note. Prior to the due date of the promissory
note, June 30, 2001, the Company was advised by MMSI that they were evaluating  
the value of the net assets transferred and they might be entitled to an offset 
against the promissory note for differences in the valuation of the net assets. 
Subsequently, MMSI defaulted on the payment of the note, and as a result, we    
obtained a judgment by default against both MMSI and MediSolution. MediSolution 
then filed a motion to vacate the default and the action was later dismissed. We
thereafter re-filed the action in Canada seeking payment of the promissory note.
MediSolution alleges certain counterclaims and seeks damages of $2,500,000. We  
believe the counterclaims are without merit.                                    

Item 2.  Changes In Securities and Use Of Proceeds                              

None.                                                       

Item 3.  Defaults Upon Senior Securities                                        

None.                                             

Item 4.  Submission of Matters to a vote of Security Holders                    

            On December 20, 2002, the Annual Meeting of Shareholders was held at
the offices of the Company. The matters to be voted upon were the approval by   
Shareholders of the sale of the assets of the Mark Correctional Division; the   
election of Directors; approval of an amendment to the Company's Certificate of 
Incorporation increasing the authorized capital common stock from 50,000,000 to 
100,000,000 shares of common stock; and the ratification of the appointment of  
Holtz Rubenstein & Co., LLP as Registrant's auditors.                           

       The holders of a majority of the shares entitled to vote approved the
election of Carl Coppola, Ronald Olszowy and William DeMarco as Directors.      
Shareholders also approved the amendment to the Company's Certificate of        
Incorporation increasing the authorized capital common stock from 50,000,000    
shares to 100,000,000 shares; and the ratification of the appointment of Holtz  
Rubenstein & Co., LLP as auditors for the fiscal year ending June 30, 2003.     

        With respect to the sale of the Mark Correctional Systems' assets, the
shareholders have approved the sale. Once the sale is finalized the Company will
cease to be an operating company. Thereafter, management intends to acquire a   
new business or merge with another operating company.                           

Item 5.  Other Information                                                      

None                                                          

Item 6.  Exhibits and Reports on Form 8-K                                       

None                                                          

-12-    

10-Q 13th Page of 15 TOC 1st Previous Next ↓Bottom Just 13th
SIGNATURES                                                                      

Pursuant to the requirements of the Securities Exchange Act of 1934, the        
Registrant has duly caused this report to be signed by the undersigned thereunto
duly authorized.                                                                

Date:     February 18, 2003                                                     

                           MARK HOLDINGS, INC.

                           By:/s/ Carl Coppola
                                   President and
                                             Chief Executive Officer

-13-    

10-Q 14th Page of 15 TOC 1st Previous Next ↓Bottom Just 14th
CERTIFICATIONS                                                                  

I, CARL COPPOLA, certify that:                                                  

1. I have reviewed this quarterly report on Form 10-Q of Mark Holdings, Inc.;   

2. Based on my knowledge, this annual report does not contain any untrue        
statement of a material fact or omit to state a material fact necessary to make 
the statements made, in light of the circumstances under which such statements  
were made, not misleading with respect to the period covered by this annual     
report.                                                                         

3. Based on my knowledge, the financial statements, and other financial         
information included in this annual report, fairly present in all material      
respects the financial condition, results of operations and cash flows of the   
registrant as of, and for, the periods presented in this annual report.         

Date:    February 18, 2003                                                      

S/ Carl Coppola                                                       
Carl Coppola, Chief Executive Officer                           
and Principal Financial Officer                                 

CERTIFICATIONS                                                                  

I, CARL COPPOLA, certify that:                                                  

1. I have reviewed this quarterly report on Form 10-Q of                        
Mark Holdings, Inc.;                                                  

2. Based on my knowledge, this quarterly report does not                        
contain any untrue                                                    
    statement of a material fact or omit to state a material fact necessary to
  make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
this quarterly report;                                                

3. Based on my knowledge, the financial statements, and                         
other financial                                                       
information included in this quarterly report, fairly present in all  
   material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this 
quarterly report;                                                     

4. The registrant's other certifying officers and I are                         
responsible for                                                       
     establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: 

a) designed such disclosure controls and procedures to                          
ensure that material                                                  
information relating to the registrant, including its consolidated    
subsidiaries, is made known to us by others within those entities,    
particularly during the period in which this quarterly report is being
prepared;                                                             

b) evaluated the effectiveness of the registrant's                              
disclosure controls and                                               
 procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and                         

c) presented in this quarterly report our conclusions about                     
the effectiveness                                                     
     of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;                                                      

1. As the registrant's certifying officer, I have disclosed                     
based on our most                                                     
    recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent 
function):                                                            

a) all significant deficiencies in the design or operation                      
of internal controls                                                  
   which could adversely affect the registrant's ability to record, process,

-14-  

10-Q Last Page of 15 TOC 1st Previous Next ↓Bottom Just 15th
summarize and report  financial data and have  identified  for the  registrant's
auditors any material weaknesses in internal controls; and                      

b) any  fraud,  whether  or not  material,  that  involves  management  or other
employees who have a significant role in the registrant's internal controls; and

1. As the registrant's certifying officer I have indicated                      
in this quarterly                                                     
   report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls 
subsequent to the date of our most recent evaluation, including any   
 corrective actions with regard to significant deficiencies and material
weaknesses.                                                           

Date:    February 18, 2003                                                      

S/ Carl Coppola                                                       
Carl Coppola, Chief Executive Officer                           
and Principal Financial Officer                                 

-15

10-Q	1st Page of 15	TOC	↑Top	Previous	Next	↓Bottom	Just 1st

10-Q	2nd Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 2nd

10-Q	3rd Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 3rd

10-Q	4th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 4th

10-Q	5th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 5th

10-Q	6th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 6th

10-Q	7th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 7th

10-Q	8th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 8th

10-Q	9th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 9th

10-Q	10th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 10th

10-Q	11th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 11th

10-Q	12th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 12th

10-Q	13th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 13th

10-Q	14th Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 14th

10-Q	Last Page of 15	TOC	1st	Previous	Next	↓Bottom	Just 15th

Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10-Q’ Filing	Date	First	Last	Other Filings

	6/30/03	12
	3/1/03	6	10
Filed on:	2/19/03
	2/18/03	13	15
	1/6/03	8		8-K
For Period End:	12/31/02	1	9	NT 10-Q
	12/20/02	8	12	8-K
	9/30/02	7		10-Q, NT 10-K, NT 10-Q
	6/30/02	2	6	10-K
	4/4/02	9
	2/28/02	6
	12/31/01	2	6	10-Q
	11/30/01	6
	6/30/01	12		10-K, 10-K/A, NT 10-K
	6/28/01	12
				List all Filings

↑Top

Filing Submission 0001012118-03-000021 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Mark Solutions Inc – ‘10-Q’ for 12/31/02

On: Wednesday, 2/19/03, at 5:12pm ET · For: 12/31/02 · Accession #: 1012118-3-21 · File #: 0-17118

Previous ‘10-Q’: ‘10-Q’ on 11/19/02 for 9/30/02 · Latest ‘10-Q’: This Filing

Quarterly Report — Form 10-QFiling Table of Contents

Document Table of Contents

Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Form 10-Q
Filing Table of Contents