x
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QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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o
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TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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NEVADA
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333-148167
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98-0530147
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||
(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File No.)
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(IRS
Employee Identification No.)
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Number of Shares
|
|
Common
Stock
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12,789,564
|
Preferred
Stock
|
1,401,786
|
Item
1.
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Financial
Statements
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Consolidated
Balance Sheets as of June 30, 2009 (unaudited) and December 31,
2008
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|||
Consolidated
Statements of Operations for the Three and Six months ended June 30, 2009
and 2008
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|||
Consolidated
Statements of Cash Flows for the Six months ended June 30, 2009 and
2008
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|||
Notes
to Consolidated Financial Statements
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|||
Item
2.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operation
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Item
3
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Quantitative
and Qualitative Disclosures About Market Risk
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Item
4.
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Control
and Procedures
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Item
1
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Legal
Proceedings
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Item
1A
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Risk
Factors
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Item
2.
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Unregistered
Sales of Equity Securities and Use of Proceeds
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Item
3.
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Defaults
Upon Senior Securities
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Item
4.
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Submission
of Matters to a Vote of Security Holders
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Item
5.
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Other
Information
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Item
6.
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Exhibits
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June
30,
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December
31,
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|||||||
ASSETS
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2009
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2008
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||||||
Current
Assets:
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(Unaudited)
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|||||||
Cash
and cash equivalents
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$ | 73,234 | $ | 289,061 | ||||
Accounts
receivable (less allowance for doubtful
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||||||||
accounts of $12,300 in 2009 and $44,800 in 2008)
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35,842 | 53,367 | ||||||
Prepaid
Expenses
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56,079 | |||||||
Total Current Assets
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165,155 | 342,428 | ||||||
Property
and Equipment:
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||||||||
Property
and equipment
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1,127,377 | 1,115,984 | ||||||
Less—Accumulated
depreciation
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(854,795 | ) | (793,110 | ) | ||||
Net Property and Equipment
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272,582 | 322,874 | ||||||
Other
Assets:
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||||||||
Other assets
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45,030 | 13,469 | ||||||
Intangible
Asset - Acquired Customer Base
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169,677 | 175,528 | ||||||
Employee
loan
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23,000 | 23,000 | ||||||
Total Other Assets
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237,707 | 211,997 | ||||||
Total Assets
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675,444 | 877,299 | ||||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
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||||||||
Current
Liabilities:
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||||||||
Accounts
payable
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108,672 | 72,037 | ||||||
Accrued
expenses
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16,494 | 10,063 | ||||||
Credit
line payable
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99,970 | 99,970 | ||||||
Due
to related party
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25,718 | 18,000 | ||||||
Due
to Nova Stor, Inc.
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58,509 | 58,509 | ||||||
Dividend
Payable
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50,000 | 25,000 | ||||||
Due
to officer
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79,025 | 7,250 | ||||||
Deferred
revenue
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68,282 | 12,790 | ||||||
Total Current Liabilities
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506,670 | 303,619 | ||||||
Commitments
and contingencies
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- | |||||||
Stockholders’
Equity:
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||||||||
Preferred
Stock, $.001 par value; 10,000,000 shares authorized;
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||||||||
1,401,786
shares issued and outstanding in each period
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1,402 | 1,402 | ||||||
Common
stock, par value $0.001; 250,000,000 shares authorized;
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||||||||
12,789,564
and 12,473,214 shares issued and outstanding
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12,789 | 12,473 | ||||||
Additional
paid in capital
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4,504,875 | 4,352,966 | ||||||
Accumulated
deficit
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(4,350,292 | ) | (3,793,161 | ) | ||||
Total
Stockholders' Equity
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168,774 | 573,680 | ||||||
Total
Liabilities and Stockholders' Equity
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$ | 675,444 | $ | 877,299 |
Three
Months Ended
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Six
Months Ended
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|||||||||||||||
June
30,
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June
30,
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|||||||||||||||
2009
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2008
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2009
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2008
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|||||||||||||
Sales
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$ | 141,034 | $ | 161,437 | $ | 280,406 | $ | 328,587 | ||||||||
Cost
of sales
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122,532 | 83,894 | 212,160 | 163,603 | ||||||||||||
Gross
Profit
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18,502 | 77,543 | 68,246 | 164,984 | ||||||||||||
Selling,
general and administrative
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335,442 | 143,266 | 598,130 | 282,644 | ||||||||||||
Loss
from Operations
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(316,940 | ) | (65,723 | ) | (529,884 | ) | (117,660 | ) | ||||||||
Other
Income (Expense)
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||||||||||||||||
Interest
income
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10 | 17 | 187 | 36 | ||||||||||||
Interest
expense
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(1,122 | ) | (586 | ) | (2,434 | ) | (875 | ) | ||||||||
Total
Other (Expense)
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(1,112 | ) | (569 | ) | (2,247 | ) | (839 | ) | ||||||||
Loss
before provision for income taxes
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(318,052 | ) | (66,292 | ) | (532,131 | ) | (118,499 | ) | ||||||||
Provision
for income taxes
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||||||||||||||||
Net
Loss
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(318,052 | ) | (66,292 | ) | (532,131 | ) | (118,499 | ) | ||||||||
Preferred
Stock Dividend
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(12,500 | ) | - | (25,000 | ) | - | ||||||||||
Net
Loss Available to Common Shareholders
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$ | (330,552 | ) | $ | (66,292 | ) | $ | (557,131 | ) | $ | (118,499 | ) | ||||
Loss
per Share – Basic and Diluted
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$ | (0.026 | ) | $ | (2.34 | ) | $ | (0.044 | ) | $ | (4.18 | ) | ||||
Weighted
Average Number of Shares - Basic and Diluted
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12,598,363 | 28,359 | 12,536,134 | 28,359 |
DATA
STORAGE CORPORATION AND SUBSIDIARY
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||||||||
CONSOLIDATED
STATEMENTS OF CASH FLOWS
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||||||||
(Unaudited)
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||||||||
Six
Months Ended
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||||||||
June
30,
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||||||||
2009
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2008
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|||||||
Net
loss
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$ | (532,131 | ) | $ | (118,499 | ) | ||
Adjustments
to reconcile net income to net cash used in operating
activities:
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||||||||
Depreciation
and amortization
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67,535 | 57,132 | ||||||
Allowance
for doubtful accounts
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(32,500 | ) | ||||||
Stock
based compensation
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9,672 | |||||||
Changes
in Assets and Liabilities:
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||||||||
Accounts
receivable
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50,025 | (25,736 | ) | |||||
Employee
Loan
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- | (5,000 | ) | |||||
Other
Assets
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(31,561 | ) | - | |||||
Prepaid
Expenses
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(13,524 | ) | ||||||
Accounts
payable
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36,661 | 44,969 | ||||||
Accrued
expenses
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6,431 | - | ||||||
Deferred
Revenue
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55,492 | - | ||||||
Due
to Related Party
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7,718 | 9,000 | ||||||
Net
Cash Used in Operating Activities
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(376,182 | ) | (38,134 | ) | ||||
Cash
Flows from Investing Activities:
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||||||||
Cash
paid for fixed assets
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(11,392 | ) | (63,868 | ) | ||||
Net
Cash Used in Investing Activities
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(11,392 | ) | (63,868 | ) | ||||
Cash
Flows from Financing Activities:
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||||||||
Advances
from credit line
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- | 99,969 | ||||||
Capital
Stock Issuance
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100,000 | |||||||
Advances
from shareholder
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71,774 | - | ||||||
Net
Cash Provided by Financing Activities
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171,774 | 99,969 | ||||||
Increase
(Decrease) in Cash and Cash Equivalents
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(215,800 | ) | (2,033 | ) | ||||
Cash
and Cash Equivalents, Beginning of Period
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289,034 | 37,778 | ||||||
Cash
and Cash Equivalents, End of Period
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$ | 73,234 | $ | 35,745 | ||||
Cash
paid for interest
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$ | 2,434 | $ | |||||
Cash
paid for income taxes
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$ | - | $ | - |
Number
of Shares Under Option
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Range
of
Option
Price
Per
Share
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Weighted
Average Exercise Price
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||||||||||
Balance
at January 1, 2009
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2,505,864
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$
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-0-
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$
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0.14
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|||||||
Granted
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423,570
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-0-
|
0.29
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|||||||||
Exercised
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-0-
|
-0-
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-0-
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|||||||||
Cancelled
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-0-
|
-0-
|
-0-
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|||||||||
Balance
at June 30, 2009
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2,929,432
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-0-
|
0.16
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2009
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||||
Weighted
average fair value of options granted
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$
|
.29
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Risk-free
interest rate
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3.07
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%
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Volatility
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85
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%
|
||
Expected
life (years)
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10
|
|||
Dividend
yield
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0.00
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%
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DATA
STORAGE CORPORATION
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Date:
August 14, 2009
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By:
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/s/ Charles M.
Piluso
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Charles
M. Piluso
President,
Chief Executive Officer
Principal
Financial Officer
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