Cautionary Statement Regarding Forward-Looking Statements

This report contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward looking statements. Forward-looking statements are not statements of historical facts, but rather reflect our current expectations concerning future events and results. The words "may," "will," "anticipate," "should," "would," "believe," "contemplate," "could," "project," "predict," "expect," "estimate," "continue," and "intend," as well as other similar words and expressions of the future, are intended to identify forward-looking statements.

Factors that may cause actual results to differ from those results expressed or implied, include, but are not limited to, those listed under "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2019 filed by the Company with the Securities and Exchange Commission (the "SEC") on March 30, 2020.

These forward-looking statements generally relate to our plans, objectives and expectations for future events and include statements about our expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts. These statements are based upon our opinions and estimates as of the date they are made. Although we believe that the expectations reflected in these forward-looking statements are reasonable, such forward-looking statements are subject to known and unknown risks and uncertainties that may be beyond our control, which could cause actual results, performance and achievements to differ materially from results, performance and achievements projected, expected, expressed or implied by the forward-looking statements. While we cannot assess the future impact that any of these differences could have on our business, financial condition, results of operations and cash flows or the market price of shares of our common stock, the differences could be significant. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented in this report and you are urged to consider all such risks and uncertainties. In light of the uncertainty inherent in such forward-looking statements, you should not consider their inclusion to be a representation that such forward-looking matters will be achieved.





General Overview

The Company is a "shell company", as defined in Rule 12b-2 of the Exchange Act. Because we are a shell company, our stockholders are unable to utilize Rule 144 to sell "restricted stock" as defined in Rule 144 or to otherwise use Rule 144 to sell our securities, and we are ineligible to utilize registration statements on Form S-3 or Form S-8 for so long as we remain a shell company and for 12 months thereafter. As a consequence, among other things, the offering, issuance and sale of our securities is likely to be more expensive and time consuming and may make our securities less attractive to investors.

The Company's Board of Directors is considering strategic uses for its funds to develop or acquire interests in one or more operating businesses. While we have focused our development or acquisition efforts on sectors in which our management has expertise, we do not wish to limit ourselves to, or to foreclose any opportunities in, any particular industry or sector. Prior to this use, the Company's funds have been, and we anticipate will continue to be, invested in high-grade, short-term investments (such as cash and cash equivalents) consistent with the preservation of principal, maintenance of liquidity and avoidance of speculation, until such time as we need to utilize such funds, or any portion thereof, for the purposes described above. The directors will also consider alternatives for distributing some or all of its cash and cash equivalents to stockholders.





Results of operations

Three months ended June 30, 2020 compared to the three months ended June 30, 2019

For the three months ended June 30, 2020, the Company had a loss from operations before income taxes of $346,000 compared to a loss from operations before income taxes of $499,000 for the three months ended June 30, 2019.

The decreased loss before income taxes of $153,000 was primarily as a result of a decrease in Other operating expenses of $197,000 mainly as the result of decreased professional fees and decreased rent expense, offset by a decrease in Interest and other income of $45,000.







Other operating expenses

For the three months ended June 30, 2020, Other operating expenses were $221,000 as compared to $418,000 for the three months ended June 30, 2019. The decreased operating expenses of $197,000 were primarily the result of decreased insurance expenses of $20,000, decreased professional fees of $111,000, decreased rent expense of $43,000 and decreased other expenses of $21,000.





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Income taxes

The Company did not record any income tax expense for the three months ended June 30, 2020. For the three months ended June 30, 2019, the Company recorded income tax expense from continuing operations of $14,000 and $25,000, respectively, which represented minimum state taxes. No tax benefit has been recorded in relation to the pre-tax loss for the three months ended June 30, 2020 and 2019, due to a full valuation allowance to offset any deferred tax asset related to net operating loss carry forwards attributable to the losses.





Other Assets

The Company has interests in land and certain flowage rights in undeveloped property (the "properties") primarily located in Killingly, Connecticut, which are deemed to be fully impaired as of June 30, 2020 and are subject to a proposed transfer (See Note 10 to the condensed consolidated financial statements).

Six months ended June 30, 2020 compared to the six months ended June 30, 2019

For the six months ended June 30, 2020, the Company had a loss from operations before income taxes of $664,000 compared to a loss from operations of $980,000 for the six months ended June 30, 2019.

The decreased loss before income taxes of $316,000 was the result of a decrease in Compensation and benefits of $21,000 and a decrease in Other operating expenses of $427,000, offset by a decrease in Interest and other income of $132,000, primarily as the result of the recovery in the first quarter of 2019 of an old investment of $100,000 in a private entity that was deemed worthless.







Compensation and benefits

For the six months ended June 30, 2020, Compensation and benefits were $259,000 as compared to $280,000 for the six months ended June 30, 2019 as the result of the Company having fewer employees and a decrease in the health plan expense for the six months ended June 30, 2020 in comparison to the six months ended June 30, 2019.





Other operating expenses

For the six months ended June 30, 2020, Other operating expenses were $465,000 as compared to $892,000 for the six months ended June 30, 2019. The decreased operating expenses of $427,000 were primarily the result of decreased insurance expenses of $40,000, decreased professional fees of $227,000, decreased rent expense of $97,000 and decreased other expenses of $63,000.





Income taxes

The Company did not record any income tax expense for the six months ended June 30, 2020. For the six months ended June 30, 2019, the Company recorded income tax expense from continuing operations of $14,000 and $25,000, respectively, which represented minimum state taxes. No tax benefit has been recorded in relation to the pre-tax loss for the six months ended June 30, 2020 and 2019, due to a full valuation allowance to offset any deferred tax asset related to net operating loss carry forwards attributable to the losses.







Financial condition

Liquidity and Capital Resources

At June 30, 2020, the Company had cash and cash equivalents totaling $6,494,000, which it intends to use to acquire interests in one or more operating businesses, to fund the Company's general and administrative expenses, and the directors will also consider alternatives for distributing some or all of its cash and cash equivalents to stockholders. The Company believes that its working capital is sufficient to support its operating requirements through June 30, 2021.

Cash equivalents represent short-term, highly liquid investments, which are readily convertible to cash and have maturities of three months or less at time of purchase. Please refer to note 5 for valuation on Investments.

The decrease in cash and cash equivalents of $842,000 for the quarter ended June 30, 2020 was primarily the result of $645,000 used in operating activities and $250,000 used to invest in long term U.S. Treasury Bills, offset by proceeds from a PPP loan of $53,000.





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