Notes to Condensed Financial Statements
For The Three- and Nine-Month Periods
Ended September 30, 2020 and 2019
Note 1 - Basis of Presentation
Pursuant to a recommendation
of the Company’s Board of Directors and approval by its shareholders on January 13, 2004, the Company sold to NC Acquisition
Corporation (the "Purchaser") on March 31, 2004 all of its tangible and intangible assets, including its real estate,
accounts, equipment, intellectual property, inventory, subsidiaries, goodwill, and other intangibles, except for $30,000 in cash,
(the "Net Asset Sale"). The Purchaser also assumed all of the Company’s liabilities pursuant to the Net Asset Sale.
Following the Net Asset Sale, the Company’s only remaining assets were $30,000 in cash and it had no liabilities. It also
retained no subsidiaries. On April 1, 2004 the Company amended its Articles of Incorporation to change its name from Nematron
Corporation to Sandston Corporation (the “Company”) and to implement a shareholder approved one-for-five reverse stock
split of the Company’s common stock, whereby every five issued and outstanding shares of the Company’s common stock
became one share. On April 1, 2004, the Company also sold a total of 5,248,257 post-split shares to Dorman Industries, LLC
(“Dorman Industries”) for $50,000. On December 21, 2006, the Company sold 2,400,000 post-split shares to certain
accredited investors for $120,000.
Dorman Industries is
a Michigan Limited Liability Company wholly owned by Mr. Daniel J. Dorman, the Company’s Chairman of the Board, President
and Principal Accounting Officer. Pursuant to its purchase of these shares, Dorman Industries became the owner of 62.50% of the
then outstanding common stock of the Company. The Company has made several subsequent sales of common stock to Dorman Industries
in order to raise cash to pay operating expenses. Between December 30, 2010 and September 30, 2020, the Company sold
to Dorman Industries a total of 6,721,591 shares at per share prices equal to the closing price the day prior to each sale, and
realized proceeds of $191,172. Dorman Industries currently is the beneficial owner of 68.33% of the Company’s outstanding
common stock.
Effective April 1,
2004, the Company became a "public shell" corporation.
The Company intends
to build long-term shareholder value by acquiring and/or investing in and operating strategically positioned companies. The Company
expects to target companies in multiple industry groups. The Company has yet to acquire, or enter into an agreement to acquire,
any company or entity.
During the period prior
to the Net Asset Sale, the Company’s businesses included 1) the design, manufacture, and marketing of environmentally ruggedized
computers and computer displays known as industrial workstations; 2) the design, development and marketing of software for use
in factory automation and control and in test and measurement environments; and 3) providing application engineering support to
customers of its own and third parties’ products. These businesses were sold on March 31, 2004 to the Purchaser.
Liquidity and Management Plans
The Company became
a "public shell" corporation on April 1, 2004 following the Net Asset Sale and since that date its operational activities
have been limited to considering sundry and various acquisition opportunities, and its financial activities have been limited to
administrative activities and incurring expenditures for accounting, legal, filing, printing, office and auditing services. These
expenditures have been paid with the $30,000 cash retained from the businesses that were sold, from $50,000 of proceeds from the
sale of common stock on April 1, 2004 to Dorman Industries, from $120,000 of proceeds from the sale, through a private placement,
to certain accredited investors of common stock in December 2006, and from $191,172 of proceeds from the sales, through private
placements, of unregistered common stock to Dorman Industries in the years 2010 through September 30, 2020.
As reflected in the
accompanying balance sheet at September 30, 2020, cash totals $203. Based on such balance and management’s forecast
of activity levels during the period that it may remain a “public shell” corporation, management will have to again
sell through private placement a number of additional shares of common stock to generate sufficient cash to pay its current liabilities
and its administrative expenses as such expenses become due in 2020. If the Company has not identified and consummated an acquisition
by that date, the Company will need to obtain additional funds to maintain its administrative activities as a public shell company.
Management intends to obtain such administrative funds from Dorman Industries in the form of loans or through equity sales in an
amount sufficient to sustain operations at their current level. There can be no assurance that Dorman Industries, which owns 68.33%
of the Company’s outstanding stock, or any other party will advance needed funds on any terms. The Company has not identified
as yet potential acquisition candidates, the acquisition of which would mean that the Company would cease being a “public
shell” and begin operating activities.
Note
2 – Loss per Share
Loss per share is calculated using the weighted
average number of common shares outstanding during the periods presented. There are no outstanding dilutive stock options and warrants;
all outstanding stock options and warrants were cancelled effective with the Net Asset Sale. The Company has no dilutive securities.