U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OF 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to _____________
Commission file number 0-23871
BCS INVESTMENT CORPORATION
(Exact name of small business issuer as specified in its charter)
COLORADO 84-1434323
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.
1708 DOLPHIN AVENUE, SUITE 400, KELOWNA, BRITISH COLUMBIA, V1Y 9S4 CANADA
(Address of principal executive offices)
(250) 717-8966
(Issuer's telephone number)
NOT APPLICABLE
(Former name, former address and former fiscal year,
if changed since last report)
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 X
No___
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the last practicable date:
14,046,080 SHARES OF COMMON STOCK, NO PAR VALUE, AS OF MAY 8, 2000
Transitional Small Business Disclosure Format (check one); Yes___ No X
Exhibit index on page 15 Page 1 of 18 pages
<PAGE>
Financial Statements of
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
March 31, 2000
2
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Balance Sheets
$ United States
March 31, 2000 and December 31, 1999
<TABLE>
<CAPTION>
======================================================================================================
2000 1999
(Unaudited)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current assets
Prepaid expenses $ 5,928 $ 25,206
- ------------------------------------------------------------------------------------------------------
$ 5,928 $ 25,206
======================================================================================================
LIABILITIES AND STOCKHOLERS' EQUITY (DEFICIENCY)
Current liabilities
Accounts payable and accrued liabilities $ 11,382 $ 13,893
Due to a related party (note 3) 11,256 22,035
Stockholders' equity (deficiency)
Capital stock (note 4) 58,133 58,133
Additional paid in capital 837,370 837,370
Deficit accumulated during the development stage (911,390) (905,402)
Accumulated comprehensive income (823) (823)
----------------------------------------------------------------------------------------------------
(16,710) (10,722)
- -------------------------------------------------------------------------------------------------------
$ 5,928 $ 25,206
=======================================================================================================
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Statements of Loss
$ United States
Three month period ended March 31, 2000 and 1999 and period from incorporation
on July 7, 1998 to March 31, 2000
(Unaudited)
<TABLE>
<CAPTION>
================================================================================================================
From inception
(July 7, 1998) to
March 31, 2000 2000 1999
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue
Interest $ 10,422 $ - $ 4,432
Expenses
Research and development
Consultants 42,049 - 2,197
Internet access charges 8,454 - 1,451
Purchased research and development 100,000 - -
Salaries and benefits 396,143 - 73,789
----------------------------------------------------------------------------------------------------------
546,646 - 77,437
General and administrative
Amortization 26,820 - 3,333
Consulting 16,838 - -
Foreign exchange 10,424 - -
Interest on long term debt 5,050 - -
Marketing and promotion 107,039 525 37
Office and administration 53,265 117 17,758
Professional fees 79,202 5,346 12,009
Rent and utilities 49,849 - 17,564
Salaries and benefits 171,321 - 34,197
Travel 52,860 - 3,199
Write off of loan receivable 10,707 - -
Write off of goodwill on purchase of
shares held by minority stockholders 65,420 - -
----------------------------------------------------------------------------------------------------------
648,795 5,988 88,097
- ----------------------------------------------------------------------------------------------------------------
Loss before income taxes and minority interest (1,185,019) (5,988) (161,102)
Income taxes 2,234 - -
- ----------------------------------------------------------------------------------------------------------------
Loss before minority interest (1,187,253) (5,988) (161,102)
Minority interest in loss of former subsidiary 59,989 - -
- ----------------------------------------------------------------------------------------------------------------
Net loss $ (1,127,264) $ (5,988) $ (161,102)
================================================================================================================
Weighted average number of shares outstanding 12,799,038 14,046,080 12,450,360
Loss per share $ (0.09) $ - $ (0.01)
================================================================================================================
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Statements of Stockholders' Equity (Deficiency) and Comprehensive Income
$ United States
Three month period ended March 31, 2000 and period from incorporation on July 7,
1998 to March 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
====================================================================================================================================
Deficit
Accumulated
Number Additional During the Accumulated
of Capital Paid in Development Comprehensive
Shares Stock Capital Stage Income Total
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BC7
====================================================================================================================================
BC7 balance, December 31, 1998 4,620,000 $ 32,900 $ 750 $ (31,796) $ - $ 1,854
Expenses paid by stockholder
on behalf of the Company - - 2,790 - - 2,790
Issued June 14, 1999 upon
5.804688 to 1 stock split 22,197,658 - - - - -
Voluntary cancellation of shares by
stockholders, June 18, 1999 (23,253,303) (28,527) 28,527 - - -
Increase in the book value of BC7's
stockholders' equity to 89% of WTI - (2,580) 805,303 (260,201) 703 543,225
- ------------------------------------------------------------------------------------------------------------------------------------
BC7 balance, June 18, 1999 prior to
reorganization and purchase of WTI
stock 3,564,355 1,793 837,370 (291,997) 703 547,869
Issued upon reorganization and
purchase of 89% WTI stock, recorded
at the book value of BC7's tangible
net assets 10,431,725 90 - - - 90
Issued October 6, 1999 for
services at $1.125 per share 45,000 50,625 - - - 50,625
Issued November 9, 1999
for services at $1.125 per share 5,000 5,625 - - - 5,625
Adjustment to record distribution of
WFI's shares of WTI to stockholders,
November 12, 1999 - - - 179,785 - 179,785
Comprehensive income:
Loss - - - (793,190) - (793,190)
Foreign currency translation
adjustment - - - - (1,526) (1,526)
- ------------------------------------------------------------------------------------------------------------------------------------
Comprehensive loss (794,716)
- ------------------------------------------------------------------------------------------------------------------------------------
WFI balance, December 31, 1999 14,046,080 58,133 837,370 (905,402) (823) (10,722)
Comprehensive income:
Loss - - - (5,988) - (5,988)
- ------------------------------------------------------------------------------------------------------------------------------------
BCS balance, March 31, 2000 14,046,080 $ 58,133 $ 837,370 $ (911,390) $ (823) $ (16,710)
====================================================================================================================================
</TABLE>
Refer to note 1 b) for basis of reporting
See accompanying notes to financial statements.
5
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Statements of Cash Flows
$ United States
Three month period ended March 31, 2000 and 1999 and period from incorporation
on July 7, 1998 to March 31, 2000
(Unaudited)
<TABLE>
<CAPTION>
==================================================================================================================
From inception
(July 7, 1998) to
March 31, 2000 2000 1999
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash provided by (used in):
Operations
Net loss $ (1,127,264) $ (5,988) $ (161,102)
Items not involving cash:
Amortization 26,820 - 3,333
Rent - - -
Services paid with share consideration 31,044 - -
Minority interest (59,989) - -
Write off of goodwill on purchase of
shares held by minority stockholders 65,420 - -
Changes in non-cash working capital:
Accounts receivable (2,701) - 1,348
Prepaid expenses (14,922) 19,278 (28,007)
Accounts payable and accrued liabilities 61,125 (2,511) 3,131
----------------------------------------------------------------------------------------------------------------
(1,020,467) 10,779 (181,297)
Financing
Advances (to) from related parties 56,130 (10,779) (15,018)
Advances from shareholder 224,990 - -
Issue of common shares for cash 942,880 - 262,667
Issue of common shares upon reorganization
and stock purchase 90 - -
Adjustment to record distribution of WTI shares
to shareholders net of non-cash items (50,126) - -
Proceeds from long term debt net of
repayments 75,766 - -
Purchase of shares held by minority
shareholders (73,146) - -
----------------------------------------------------------------------------------------------------------------
1,176,584 (10,779) 247,649
Investments
Expenditures on capital assets (155,381) - (9,169)
Foreign currency translation adjustment (736) - (6,475)
- -------------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash - - 50,708
Cash, beginning of period - - 315,658
- -------------------------------------------------------------------------------------------------------------------
Cash, end of period $ - $ - $ 366,366
===================================================================================================================
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Notes to Financial Statements
$ United States
Three month period ended March 31, 2000 and period from incorporation on July 7,
1998 to March 31, 1999
(Unaudited)
- --------------------------------------------------------------------------------
BCS Investment Corporation (formerly Workfire.com, Inc.) ("BCS" or the
"Company") is a development stage company and was incorporated under the
name of Buffalo Capital VII, Ltd. ("BC7") on September 19, 1997 under the
laws of the state of Colorado. The Company adopted the name, Workfire.com,
Inc. ("WFI") effective June 18, 1999 and formally changed its name from
Buffalo Capital VII, Ltd. to Workfire.com, Inc. on July 12, 1999. During
1999, the Company's principal business activity, carried on through it's
former subsidiary, Workfire.com (formerly Workfire Technologies Inc.)
("WTI"), was the development of software to deliver extended internet
services to internet users. On November 12, 1999, the Company distributed
it's shares of Workfire.com on a prorata basis to it's stockholders of
record on that date and became a shell company with no active operations.
On February 7, 2000 the name of the Company was changed to BCS Investment
Corporation.
1. SIGNIFICANT ACCOUNTING POLICIES:
a) General
The information included in the accompanying consolidated interim
financial statements is unaudited and should be read in conjunction
with the annual audited financial statements and notes thereto
contained in the Company's Report on Form 10-KSB for the fiscal year
ended December 31, 1999. In the opinion of management, all
adjustments, consisting of normal recurring accruals, necessary for a
fair presentation of the results of operations for the interim periods
presented have been reflected herein. The results of operations for
the interim periods presented are not necessarily indicative of the
results to be expected for the entire fiscal year.
b) Basis of reporting
These financial statements include the accounts of the Company as
noted below and the results of operations of it's former wholly-owned
subsidiary, WTI, and WTI's wholly-owned subsidiaries, Workfire
Technologies International Inc. ("WTII") and Workfire Development
Corporation ("WDC"), to November 12, 1999.
Effective June 18, 1999, the Company acquired 89% of the outstanding
common shares of WTI. As WTI stockholders obtained control of the
Company through the exchange of their shares of WTI for shares of the
Company, the acquisition of WTI has been accounted for in these
financial statements as a reverse acquisition. On September 30, 1999,
pursuant to the General Corporation Laws of the State of Nevada, WTI
paid its dissenting stockholders represented by the residual 11%
minority share ownership, what it determined to be the fair value of
their shares, and subsequently cancelled the shares. On November 12,
1999, the Company distributed all of it's shares of WTI on a prorata
basis to it's stockholders of record on that date.
7
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States
Three month period ended March 31, 2000 and period from incorporation on July 7,
1998 to March 31, 1999
(Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
b) Basis of reporting (continued)
Consequently, the statements of loss and cash flows for the three
month period ended March 31, 1999 reflect solely the results of
operations and the cash flows of WTI, and its wholly-owned
subsidiaries, WTII and WDC. The statements of loss and cash flows for
the periods ended June 30 and September 30, 1999 will reflect the
results of operations and the cash flows of WTI, and its wholly-owned
subsidiaries, WTII and WDC, for the period from January 1, 1999 to
November 12, 1999, combined with those of the legal parent, WFI, from
acquisition on June 18, 1999, in accordance with generally accepted
accounting principles for reverse acquisitions. The comparative
figures for the period from incorporation on July 7, 1998 to December
31, 1998 are those of the legal subsidiary, WTI.
In these notes to the financial statements, the Company, prior to the
business combination with WTI, is referred to as BC7, and after
completion of the business combination and name change, is referred to
as WFI.
c) Translation of financial statements
The Company's former subsidiary, Workfire Development Corporation,
operates in Canada and its operations are conducted in Canadian
currency.
These statements are presented in United States currency for the
convenience of readers accustomed to United States currency. The
method of translation applied prior to the Company's distribution of
it's ownership in WTI was as follows:
i) Monetary assets and liabilities were translated at the rate of
exchange in effect at the distribution date, being US $1.00 per
Cdn $1.462.
ii) Non-monetary assets and liabilities were translated at the
exchange rate in effect at the transaction date.
iii) Revenues and expenses were translated at the exchange rate in
effect at the transaction date.
iv) The net adjustment arising from the translation was recorded as a
separate component of stockholders' equity (deficiency) called
"foreign currency translation adjustment".
d) Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
8
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States
Three month period ended March 31, 2000 and period from incorporation on July 7,
1998 to March 31, 1999
(Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
e) Financial instruments
The fair values of accounts payable and accrued liabilities
approximate their carrying values due to the relatively short periods
to maturity of these instruments. It is not possible to determine the
fair value of amounts due from/to related parties as a maturity date
is not determinable. The maximum credit risk exposure for all
financial assets is the carrying amount of that asset.
2. BUSINESS COMBINATION:
Effective June 18, 1999, BC7 and WTI executed a reorganization and stock
purchase agreement. BC7 issued 10,431,725 common shares to the shareholders
of WTI in consideration for 89% of the issued and outstanding common shares
of WTI on the basis of 1 common share of BC7 for each common share of WTI.
As the former shareholders of WTI obtained control of BC7 through the share
exchange, this transaction was accounted for in these financial statements
as a reverse acquisition and the purchase method of accounting was applied.
Under reverse acquisition accounting, WTI is considered to have acquired
BC7 with the results of BC7's operations included in the financial
statements from the date of acquisition. The acquisition has been recorded
at the tangible net asset value of BC7 at the date of acquisition. The
acquisition details are as follows:
Net assets acquired
Cash $ 1,310
Accounts payable (1,220)
---------------------------------------------------------------------------
$ 90
===========================================================================
Consideration given for net assets acquired
10,431,725 Common shares issued $ 90
===========================================================================
As WTI is deemed to be the continuing entity, stockholders' equity of WFI
(formerly BC7) was increased by $543,225 as a result of accounting for this
combination as a reverse acquisition.
3. DUE TO RELATED PARTY:
The amount due to related party is unsecured, non-interest bearing and
without stated terms of repayment.
9
<PAGE>
BCS INVESTMENT CORPORATION
(Formerly Workfire.com, Inc.)
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States
Three month period ended March 31, 2000 and period from incorporation on July 7,
1998 to March 31, 1999
(Unaudited)
- --------------------------------------------------------------------------------
4. CAPITAL STOCK:
a) Authorized:
100,000,000 common voting shares, without par value
10,000,000 non-voting preferred shares without par value
b) Stock option plan:
The Company reserved 1,375,840 common shares for issuance to officers
and key employees pursuant to it's Stock Option Plan. This amount is
to be adjusted annually to be the greater of 9% of the issued common
shares of the Company outstanding at the end of the immediately
preceding fiscal year, or 1,375,840. Unless the option agreement
executed by an optionee expressly otherwise provides, no portion of
the options can be exercised until at least three months after the
grant date (the "vesti date").
The following stock options were granted during the period ended March
31, 2000:
<TABLE>
<CAPTION>
==================================================================================================================================
Number Granted Exercised Expired Number Exercise
outstanding, during the during the during outstanding price per
beginning of period period the end of share Expiry date Vesting date
period period period
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
5,999 - - 5,999 - $1.1875 September 7, 2004 December 7, 1999
84,375 - - 84,375 - $2.93 June 19, 2009 September 19, 1999
74,000 - - 74,000 - $2.93 June 19, 2009 June 19, 2000
74,000 - - 74,000 - $2.93 June 19, 2009 June 19, 2001
74,000 - - 74,000 - $2.93 June 19, 2009 June 19, 2002
- ----------------------------------------------------------------------------------------------------------------------------------
312,374 - - 312,374 -
==================================================================================================================================
</TABLE>
The Company applies APB Opinion No. 25 in accounting for it's stock
options and, accordingly, no compensation cost has been recognized for
its stock options in the financial statements. These stock options
were issued to officers and key employees of WTI. The Company
distributed its shares of WTI to its stockholders on November 12,
1999, and became a shell company with no active or prospective
operations. As a result of the distribution of WTI stock on November
12, 1999, the stock options were terminated effective February 12,
2000 pursuant to the terms of the Company's stock option plan since
the grantees were no longer employees of the Company or its
subsidiary. Accordingly, had the Company determined compensation cost
based on the fair value at the grant date for its stock options under
SFAS No. 123, the Company's net loss for the period ended March 31,
2000 or the period from incorporation on July 7, 1998 to March 31,
2000 would not have required any adjustment.
10
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion should be read in conjunction with the consolidated
financial statements of the Company. This report includes certain
forward-looking statements, which reflect the Company's plans, estimates and
beliefs. The Company's actual results could differ materially from those
discussed in the forward-looking statements based upon, among other things, the
Company's ability to raise additional capital, its ability to identify a
suitable acquisition target and close such acquisition. The inability to obtain
additional financing when needed will have a material adverse effect on the
Company's operating results.
GENERAL
The Company was incorporated under the laws of the State of Colorado on
September 19, 1997. From its inception to June 18, 1999, the Company operated as
a "shell" company and its business plan was to seek out and take advantage of
business opportunities that may have had the potential for profit, and to
acquire such businesses, or a controlling interest therein.
On June 18, 1999, a change in control of the Company occurred, in conjunction
with closing under a Reorganization and Stock Purchase Agreement between the
Company and Workfire.com, a Nevada corporation ("Workfire-Nevada"). As the
result of a Reorganization and Stock Purchase Agreement, the Company acquired
89.00% of the issued and outstanding shares of Workfire-Nevada. On November 5,
1999, the board of directors of the Company approved a resolution to distribute
all of the shares of Workfire-Nevada owned by the Company, pro rata to the
Company's shareholders (the "Share Distribution"). The Share Distribution was
made to shareholders of record as at the close of business on November 12, 1999.
As a result of the Share Distribution, the financial statements of the Company
prior to the Share Distribution are not necessarily indicative of the Company's
current or future operations.
As of the date of this report the Company had no source of income and must rely
entirely upon loans and equity investments from affiliates to pay operating
expenses.
Accordingly, the financial statements for the period from inception to March 31,
2000, included in the Company's March 31, 2000 financial statements, include the
operations and cash flows of Workfire-Nevada, combined with those of the parent
(the shell company) from acquisition on June 18, 1999 to November 12, 1999. The
comparative figures for the period for the three month period ended March 31,
1999 are those of Workfire-Nevada and its subsidiaries.
PLAN OF OPERATION
The Company currently has no capital to fund operations or on-going expenses.
The Company must rely upon loans and investments from affiliates to pay
operating expenses. There are no assurances that such affiliates will continue
to advance funds to the Company or will continue to invest in the Company's
securities. In the event the Company is unable to obtain additional financing it
may be unable to identify and/or acquire a suitable business opportunity. During
the
11
<PAGE>
twelve months following the filing of this report, management intends to seek to
acquire assets or shares of an entity actively engaged in a business that
generates revenues, in exchange for the Company's securities. The Company has
not identified a particular acquisition target and has not entered into any
negotiations regarding such an acquisition. Management intends to contact
investment bankers, corporate financial analysts, attorneys and other investment
industry professionals through various media. None of the Company's officers,
directors, promoters or affiliates have engaged in any preliminary contact or
discussions with any representative of any other company regarding the
possibility of an acquisition or merger between the Company and such other
company as of the date of this report.
Depending upon the nature of the relevant business opportunity and the
applicable state statutes governing the manner in which the transaction is
structured, the Company's Board of Directors expects that it will provide the
Company's shareholders with complete disclosure documentation concerning a
potential business opportunity and the structure of the proposed business
combination prior to consummation. Such disclosure is expected to be in the form
of a proxy, information statement, or report.
While such disclosure may include audited financial statements of such a target
entity, there is no assurance that such audited financial statements will be
available. The Board of Directors does intend to obtain certain assurances of
value of the target entity=s assets prior to consummating such a transaction,
with further assurances that audited financial statements would be provided
within sixty days after closing. Closing documents will include representations
that the value of the assets conveyed to or otherwise so transferred will not
materially differ from the representations included in such closing documents,
or the transaction will be voidable.
Due to the Company's intent to remain a shell company until a merger or
acquisition candidate is identified, it is anticipated that its cash
requirements will be minimal, and that all necessary capital, to the extent
required, will be provided by the directors or officers. The Company does not
anticipate that it will have to raise capital or acquire any plant or
significant equipment in the next twelve months, unless a merger or acquisition
target is identified.
LIQUIDITY
The Company=s cash flows from operating activities during the three months ended
March 31, 2000 and 1999 were $10,779 and $(181,297), respectively. The increase
from 1999 to 2000 is attributed to a decrease in the Company's net loss during
2000 (due to the Company's divestiture of its ownership in Workfire-Nevada) and
a decrease in prepaid expenses during 2000. The Company's cash flows from
financing activities during 2000 and 1999 were $(10,779) and $247,649,
respectively. The Company's financing activities during 2000 consisted primarily
of advances to a related party which relate to services to be performed for
Workfire-Nevada by third parties, which the Company prepaid. As the services are
performed, the Company decreases the amount of the prepaid expense and reduces
its liability due to a related party. During the three month period ended March
31, 1999, the Company's financing activities consisted primarily of the issuance
of common shares for cash, in the amount of $262,667.
12
<PAGE>
At March 31, 2000 the Company had a working capital deficiency of $5,454,
compared to a working capital surplus of $11,313 at December 31, 1999. The
decrease in working capital is a result of an increase in accounts payable and
accrued liabilities in 1999 relating to expenses incurred in the period, and a
decrease in prepaid expenses relating to the services provided to
Workfire-Nevada by third parties (which were prepaid by the Company).
Workfire-Nevada was the Company's operating subsidiary and the loss of the
operating subsidiary has left the Company with no material assets.
Since the Company has no significant source of revenue, working capital will
continue to be depleted by operating expenses. See "Results of Operations"
below. The Company presently has no external sources of cash and is dependent
upon its management and shareholders for funding.
ASSETS
At March 31, 2000, the Company had total assets of $5,928, compared to total
assets of $25,206 at December 31, 1999. All of the Company's assets at December
31, 1999 and March 31, 2000, consisted of prepaid expenses relating to
professional fees by third parties for services to be performed for
Workfire-Nevada. As of the date of this report, the Company has essentially no
assets.
RESULTS OF OPERATIONS
The Company has no current operations and has not generated any revenue from its
operations since the Share Distribution. The Company must rely entirely upon
loans from affiliates pay operating expenses.
During the three month period ended March 31, 2000, the Company incurred a net
loss of $5,988. Due to the Share Distribution, as of the date of this report,
the Company essentially has no operations and no source of revenue. The Company
continues to incur professional fees and other expenses. If the Company does not
find a suitable acquisition target or other source of revenue, the Company will
continue to incur net losses and may have to cease operations entirely. This
factor, among others, raises substantial and compelling doubt about the
Company=s ability to continue as a going concern.
The Company's ability to continue as a going concern is dependent upon its
ability to generate sufficient cash flow to meet its obligations on a timely
basis, to identify and close an acquisition with a suitable target company,
obtain additional financing or refinancing as may be required, and ultimately to
attain profitability. There are no assurances that the Company will be able to
identify a suitable acquisition target, close such acquisition, obtain any such
financing or, if the Company is able to obtain additional financing, that such
financing will be on terms favorable to the Company. The inability to obtain
additional financing when needed will have a material adverse effect on the
Company=s operating results.
13
<PAGE>
IMPACT OF THE YEAR 2000
The Year 2000 issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in some
systems which use certain dates in 1999 to represent something other than a
date. The effects of the Year 2000 issue may be experienced before, on, or after
January 1, 2000, and, if not addressed, the impact on operations and financial
reporting may range from minor errors to significant systems failure which could
affect the Company's ability to conduct normal business operations. The only
software utilized by the Company is a general ledger accounting program.
Management believes the Company does not face significant internal risk from
computer failure or errors due to the Year 2000 Issue. It is not possible to be
certain that all aspects of the Year 2000 issue affecting the Company, including
those related to the efforts of customers, suppliers, or other third parties,
will be fully resolved. As of the date of this report, the Company has not
experienced any problems related to the Year 2000.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not Applicable.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Not Applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At a Special Meeting of the Company's shareholders held on February 7, 2000, the
Company's shareholders approved an amendment to the Company's Articles of
Incorporation changing the Company's name to BCS Investment Corporation. At the
meeting 7,211,033 shares were represented, in person or by proxy. A total of
7,206,033 shares were voted in favor of the amendment, no shares were voted
against the amendment and 5,000 shares abstained.
ITEM 5. OTHER INFORMATION
Not Applicable.
14
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A) EXHIBITS
REGULATION CONSECUTIVE
S-B NUMBER EXHIBIT PAGE NUMBER
3.1 Articles of Incorporation, as amended (3) N/A
3.2 Bylaws (1) N/A
4.1 Warrant Agent Agreement (1) N/A
4.2 Specimen Class A Warrant Certificate (1) N/A
4.3 Specimen Class B Warrant Certificate (1) N/A
4.4 Stock Option Plan (3) N/A
11 Statement Re: Computation of Per Share Earnings See Financial
Statements
27 Financial Data Schedule 17
99.1 Reorganization and Stock Purchase Agreement (2) N/A
- ---------------------------
(1) Incorporated by reference from the Registration Statement on Form 10-SB
filed with the Securities and Exchange Commission on March 4, 1998.
(2) Incorporated by reference from the Current Report on Form 8-K filed
with the Securities and Exchange Commission dated June 18, 1999.
(3) Incorporated by reference from the Annual Report on Form 10-KSB for the
fiscal year ended December 31, 1999, filed with the Securities and
Exchange Commission.
B) REPORTS ON FORM 8-K:
None.
15
<PAGE>
SIGNATURES
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.
BCS Investment Corporation
Date: May 15, 2000 By: /s/ Philip Stern
- -------------------------------------------------------------------------------
Philip Stern
Secretary, Treasurer and Principal
Financial Officer
16
<PAGE>
Exhibit 27
Financial Data Schedule
17
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE COMPANY'S
BALANCE SHEETS, STATEMENTS OF LOSS, STATEMENTS OF STOCKHOLDERS' EQUITY
(DEFICIENCY) AND COMPREHENSIVE INCOME, STATEMENTS OF CASH FLOWS, AND THE NOTES
THERETO FOUND ON PAGES 2 THROUGH 10 OF THE COMPANY'S FORM 10-QSB FOR THE THREE
MONTH PERIOD ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5,928
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,928
<CURRENT-LIABILITIES> 11,382
<BONDS> 11,256
0
0
<COMMON> 58,133
<OTHER-SE> (74,843)
<TOTAL-LIABILITY-AND-EQUITY> 5,928
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,988
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5,988)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,988)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,988)
<EPS-BASIC> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
