U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES ACT OF 1934
For the quarterly period ended June 30, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES ACT OF 1934
For the transition period from __________ to _______________
Commission file number: 0-25511
Silver State Vending Corporation
(Exact name of small business issuer as
specified in its charter)
Nevada
(State or other jurisdiction of incorporation or organization)
88--0860379
(IRS Employer Identification No.)
236 S. Rainbow Blvd., Suite 496, Las Vegas, NV 89128
(Address of principal executive offices)
(702) 363-0066
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during the
past 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 [ ] No [x]
State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest practicable
date: 11,409,500
Transitional Small Business Disclosure Format:
Yes [ ] No [x]
<PAGE> 1
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The unaudited condensed financial statements presented herein have been
prepared by the Company in accordance with the instructions to Form 10-QSB
and do not include all of the information and note disclosures required by
generally accepted accounting principles. These condensed financial statements
should be read in conjunction with the audited financial statements and notes
thereto for the period ended December 31, 1998 included in the Company's Form
10-SB12G. The accompanying financial statements have not been examined by
independent accountants in accordance with generally accepted auditing
standards, but in the opinion of management such financial statements include
all adjustments (consisting only of normal recurring adjustments) necessary
to present fairly the Company's financial position and results of operations.
The results of operations for the six months ended June 30, 1999 may not be
indicative of the results that may be expected for the year ending December
31, 1999.
<PAGE> 2
SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
(Unaudited)
JUNE 30, 1999 AND JUNE 30,1998
<PAGE> 3
TABLE OF CONTENTS
Page Number
ACCOUNTANT'S REPORT ............................................... 1
FINANCIAL STATEMENT:
Balance Sheet ..................................................... 2
Statement of Operations and Deficit
Accumulated During the Development Stage ......................... 3
Statement of Changes in Stockholders' Equity ...................... 4
Statement of Cash Flows ........................................... 5
Notes to the Financial Statements ................................. 6
<PAGE> 4
DAVID E. COFFEY
3561 Lindell Rd, Suite H Las Vegas, NV 89103
CERTIFIED PUBLIC ACCOUNTANT
(702) 871-3979
To the Board of Directors and Stockholders
of Silver State Vending Corporation
Las Vegas, Nevada
The accompanying balance sheet of Silver State Vending Corporation
(a development stage company) as of June 30, 1999 and the related
statements of operations, stockholders' equity and cash flows for
the three months and six months ended June 30, 1999 and 1998 and
from inception on September 30, 1996 through June 30, 1999 were not
audited by me and, accordingly, I do not express an opinion on
them. The accompanying balance sheet as of December 31, 1998 was
audited by me and I expressed an unqualified opinion on it in my
report dated March 12, 1999.
/s/ DAVID COFFEY
David Coffey C.P.A.
August 4, 1999
<PAGE> 5
SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
(Unaudited)
June 30, December 31,
1999 1998
------ ------
Unaudited
ASSETS
Cash $ 1,785 $ 9,776
Organizational costs less accumulated
amortization 1,880 2,298
Deposits 420 420
Prepaid expenses 460 445
Equipment less accumulated
depreciation 6,225 6,267
----- -----
Total Assets $ 10,770 $ 19,206
====== ======
LIABILITIES & STOCKHOLDERS' EQUITY
Accounts payable:
Trade $ 233 $ 875
--- ---
Total Liabilities 233 875
Stockholders' Equity
Common stock, authorized 20,000,000 shares
at $.001 par value, issued and outstanding
11,409,500 shares 11,409 11,409
Preferred stock, 5,000,000 shares
at $.001 per value, no shares issued
or outstanding 0 0
Additional paid-in capital 16,986 16,986
Deficit accumulated during
the development stage (17,858) (10,064)
------ ------
Total Stockholders' Equity 10,537 18,331
Total Liabilities and Stockholders'
Equity $ 10,770 $ 19,206
====== ======
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE> 6
SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS AND DEFICIT
ACCUMULATED DURING THE DEVELOPMENT STAGE
(With Cumulative Figures From Inception)
(Unaudited)
<TABLE>
<CAPTION>
For the Three For the Three For the Six For the Six Inception
Months Ended Months Ended Months Ended Months Ended Sept. 30, 1996
June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 To June 30, 1999
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Sales $ 97 $ 165 $ 201 $ 417 $ 1,106
Cost of sales (42) (66) (122) (167) (439)
--- --- --- --- ---
Gross margin 55 99 79 250 667
Expenses
Amortization 209 209 418 418 2,305
Advertising 0 125 0 125 125
Consulting 300 625 600 1,320 4,520
Depreciation 21 0 42 0 105
Licencing and fees 45 0 314 75 950
Office expenses 7 0 17 431 583
Professional fees 3,850 0 5,945 2,500 8,445
Rent 270 89 537 89 1,160
Travel 0 0 0 332 332
----- ----- ----- ----- -----
Total expenses 4,702 1,048 7,873 5,290 18,525
Net loss (4,647) ( 949) (7,794) (5,040) $ (17,858)
======
Deficit accumulated,
beginning of period (13,211) (7,573) (10,064) (3,482)
------ ------ ------ ------
Deficit accumulated
during the
development stage $ (17,858) $ (8,522) $ (17,858) $ (8,522)
======= ===== ====== =====
Earnings (loss) per share
Assuming Dilution: $ (.00) $ (.00) $ (.00) $ (.00) $ (.00)
===== ===== ===== ===== =====
</TABLE>
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE> 7
SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD FROM September 30, 1996 (Date of Inception)
To June 30, 1999
<TABLE>
<CAPTION>
Additional
Common Stock Paid-in
Shares Amount Capital Total
------ ------ ------- ------
<S> <C> <C> <C> <C>
Balance,
September 30, 1996 - $ - $ -- $ --
Issuance of common
stock for services 8,000,000 8,000 0 8,000
Issuance of common 1,000,000 1,000 0 1,000
stock for cash
Less net loss 0 0 0 (210)
--------- ------ ----- ------
Balance,
December 31, 1996 9,000,000 9,000 0 8,790
Issuance of common
stock for cash 2,409,500 2,409 21,686 24,095
Less offering cost 0 0 (4,100) (4,100)
Less net loss 0 0 0 (3,272)
----------- ------- ------ -------
Balance,
December 31, 1997 11,409,500 11,409 17,586 25,513
Less net loss 0 0 0 (6,582)
Less offering cost 0 0 (600) (600)
---------- ------- ------ ------
Balance,
December 31, 1998 11,409,500 $ 11,409 $ 16,986 $ 18,331
Less net loss 0 0 0 (3,147)
---------- ------ ----- ------
Balance,
March 31, 1999 11,409,500 $ 11,409 $ 16,986 $ 15,184
Less net loss 0 0 0 (4,647)
--------- ------ ----- ------
March 31, 1999 11,409,500 $ 11,409 $ 16,986 $ 10,537
========== ====== ====== ======
</TABLE>
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE> 8
THE SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(With Cumulative Figures From Inception)
(Unaudited)
<TABLE>
<CAPTION>
For the Three For the Three For the Six For the Six Inception
Months Ended Months Ended Months Ended Months Ended Sept. 30, 1996
June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 To June 30, 1999
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES
Net loss $ (4,647) $ (949) $ (7,794) $ (5,040) $ (17,858)
Noncash expenses included in net loss
Amortization 209 209 418 418 2,305
Depreciation 21 0 42 0 105
(Decrease)Increase in accounts payable (259) 0 (642) (2,000) 233
Increase in deposits 0 0 0 0 (420)
Decrease(Increase) in prepaid expenses (282) (978) (15) (978) (460)
(Increase)Decrease in Inventory 0 66 0 (17) 0
------ ------ ----- ----- -----
NET CASH PROVIDED BY
OPERATING ACTIVITIES (4,958) (1,652) (7,991) (7,617) (16,095)
CASH FLOWS USED BY INVESTING ACTIVITIES
Organizational costs 0 0 0 0 185
Purchase of equipment 0 5,000 0 5,000 6,330
----- ----- ----- ----- -----
NET CASH USED BY
INVESTING ACTIVITIES 0 5,000 0 5,000 6,515
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 0 0 0 0 2,409
Additional paid-in capital 0 0 0 0 21,686
Less offering costs 0 0 0 (600) (700)
----- ---- ----- ----- -----
NET CASH PROVIDED BY
FINANCING ACTIVITIES 0 0 0 (600) 24,395
------ ----- ----- ----- -----
NET INCREASE(DECREASE) (4,958) (6,652) (7,991) (13,217) $ 1,785
=====
CASH AT BEGINNING OF PERIOD 6,743 17,578 9,776 24,143
------ ------ ----- -----
CASH AT END OF PERIOD $ 1,785 $ 10,926 $ 1,785 $ 10,926
====== ====== ====== ======
Supplemental disclosure of cash flow information:
Issuance of common stock in exchange
for services $ 8,000
======
</TABLE>
The accompanying notes are an integral part of these financial statements.
-5-
<PAGE> 9
SILVER STATE VENDING CORPORATION
(A DEVELOPMENT STAGE COMPANY)
JUNE 30, 1999 and JUNE 30, 1998
NOTES TO THE FINANCIAL STATEMENTS
Silver State Vending Corporation (the Company) has elected to omit
substantially all footnotes to the financial statements for the
six months ended June 30, 1999, since there have been no
material changes (other than indicated in other footnotes) to the
information previously reported by the Company in the audited
financial statements for the fiscal year ended December 31, 1998 as
filed in the Registration Statement filed on Form 10-SB.
UNAUDITED INFORMATION
The information furnished herein was taken from books and records
of the Company without audit. However, such information reflects
all adjustments which are, in the opinion of management, necessary
to properly reflect the results of the period presented. The
information presented is not necessarily indicative of the results
form operations expected for the full fiscal year.
-6-
<PAGE> 10
Item 2. Management's Discussion and Analysis or Plan of
Operation
This Form 10-QSB includes, without limitation, certain
statements containing the words "believes", "anticipates",
"estimates", and words of a similar nature, which constitute
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. This Act provides a "safe
harbor" for forward-looking statements to encourage companies to
provide prospective information about themselves so long as they
identify these statements as forward looking and provide
meaningful, cautionary statements identifying important factors
that could cause actual results to differ from the projected
results. All statements other than statements of historical fact
made in this Form 10-QSB are forward-looking. In particular, the
statements herein regarding the placing of equipment, future cash
requirements, future profitablity and year 2000 issues are
forward-looking statements. Forward-looking statements reflect
management's current expectations and are inherently uncertain.
The Company's actual results may differ significantly from
management's expectations.
GENERAL
The Company currently operates at 236 S. Rainbow Bl., Suite 496,
Las Vegas, Nevada 89128. The Company's principal business is
providing bulk vending goods to the greater Las Vegas area, as well
as southern Nevada.
Results of Operations for the Six Months Ended June 30, 1999.
Revenues for the six months ended June 30, 1999 were $201, which is $216
less than the $417 in revenue for the six months ended June 30, 1998.
Management of the Company attributes this decreased revenue to having
less vending machines in service during this period in 1999. Conversely,
the Company's expenditures increased during the six months ended
June 30, 1999 by $2,583. During the first six months of 1998 the Company's
expenses were $5,290 vs. $7,873 during the same period of 1999. Management
attributes the increased expenses to the cost associated with the preparation
of quarterly financial reports and filing with the NASD, through a market
maker, to seek listing of the Company's common stock on the OTC Bulletin
Board.
<PAGE> 11
The net income for the six months ended June 30, 1999 was $(7,794) as
compared to $(5,040) during the six months ended June 30, 1998. This
represents a decrease in net income of $2,754, due in large part
to the increased expenses.
Liquidity and Capital Resources
Cash as of June 30, 1999 was $1,785 as compared to $9,776 as of
June 30, 1998.
PLAN OF OPERATION
During the next twelve months the Company's plan of operation is
dependent upon management's ability to purchase, place and service
the Company's vending machines. The Company will rely upon
management's abilities and years of experience in the vending
industry, both in the bulk and refrigerated vending sectors.
During the next twelve months, the Company's cash requirements will
include its lease payments on the Company's office space in Las
Vegas, Nevada, as well as rental of storage space and miscellaneous
overhead. Management believes that the Company's existing cash
resources and cash generated from operations will be sufficient to
fund the Company's ongoing operations through the remainder of 1999
and be sufficient to provide for the foregoing cash requirements
for day to day operations in the next twelve months. There is no
guarantee that the budgeted funds will be sufficient to achieve
these goals. Management believes that it will not achieve
profitability until it is able to realize approximately $5,000 in
gross sales per month. The Company has no guarantee that it will be
able to achieve this goal in the next twelve months. The Company
may require additional funds and time to achieve these goals. Even
if the Company begins generating revenues, it could require
additional funding for expansion. The Company may find it difficult
to succeed in securing additional financing. The Company may be
able to attract some private investors, or an officer and/or
director may be willing to make additional cash contributions,
advancements or loans. Or, as an alternative, the Company could
attempt some form of debt or equity financing.
<PAGE> 12
YEAR 2000 ISSUES
- -----------------
The Company has conducted a comprehensive review of its
computer, telephone and alarm systems to identify the systems
that could be affected by the Year 2000 issue and is developing
an implementation plan to resolve the issue.
The issue pertains to whether or not computer systems will
properly recognize date-sensitive information when the year
changes to 2000. Systems that do not properly recognize such
information could generate erroneous data or cause a system to
fail. The company is heavily dependent on computer processing in
the conduct of its business activities.
The Company has identified three areas which could be
affected by the Year 2000 issue: computer systems, shipping
services and telephone systems.
A. Computer Systems
The Company uses a variety of computer software
packages to operate the business, the majority of which are small
"canned" programs which are used in day-to-day operations. The
Company has reviewed the software it uses (i.e., Microsoft Office
with the upgrade to Microsoft Office 2000 and related programs)
and has been assured by Microsoft Corporation that its products
that it uses are new enough to not be affected by any Year 2000
issues.
B. Shipping Services
The Company currently uses the United Parcel Service
for parts for the vending equipment. The Company was assured by
a spokesperson for United Parcel Service that there will be no
interruption by the Year 2000 and will not be affected adversely
by any Year 2000 concerns.
C. Telephone Systems
The Company uses the only local carrier in Las Vegas,
Sprint, for its telephone system. Sprint uses a Nortel DMS 100
system which will accommodate Y2K issues.
<PAGE> 13
The Company will experience no additional costs to
upgrade or modify the phone systems to accommodate any Year 2000
issues.
Based on the review of the computer systems, management does
not believe the cost of remediation will be material to the
Company's financial position and result of operations.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Item Description
-------- ----------------------------------------------------
27 Financial Data Schedule
(b) Reports on Form 8-K
No Reports on Form 8-K have been filed for the quarter ended
June 30, 1999.
Items 1, 2, 3, 4 and 5 of Part II have been omitted as inapplicable
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SILVER STATE VENDING CORPORATION
August 12, 1999 By: /s/ ARVON BURTON
Arvon Burton
Treasurer (Chief Financial Officer)
and duly authorized officer
<PAGE> 14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED JUNE 30, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FORM 10-QSB FOR THE PERIOD ENDED
JUNE 30, 1999.
</LEGEND>
<CIK> 0001037759
<NAME> SILVER STATE VENDING CORPORATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 1,785
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,760
<PP&E> 6,330
<DEPRECIATION> (105)
<TOTAL-ASSETS> 10,770
<CURRENT-LIABILITIES> 233
<BONDS> 0
0
0
<COMMON> 11,409
<OTHER-SE> (872)
<TOTAL-LIABILITY-AND-EQUITY> 10,770
<SALES> 201
<TOTAL-REVENUES> 201
<CGS> 122
<TOTAL-COSTS> 122
<OTHER-EXPENSES> 7,873
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,794)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,794)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,794)
<EPS-BASIC> (.001)
<EPS-DILUTED> (.001)
</TABLE>
