FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended March 31, 2000
AND
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 0-27131
DP CHARTERS, INC.
(Exact name of Registrant as specified in its charter)
Nevada 88-0381258
(Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
34700 Pacific Coast Highway, Suite 303 Capistrano Beach CA 92624
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (949) 248-9561
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: 27,656,000
Yes [X] No [ ] (Indicate by check mark whether the Registrant (1) has filed
all report required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 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.)
As of March 31, 2000, the number of shares outstanding of the Registrant's
Common Stock was 27,656,000.
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PART I: FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS.
Attached hereto and incorporated herein by this reference are consolidated
unaudited financial statements (under cover of Exhibit 00-FQ1) for the three
months ended March 31, 2000.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
(A) PLAN OF OPERATION FOR THE NEXT TWELVE MONTHS. This Registrant has filed a
1934 Act Registration which is currently effective, by operation of law, but
which has not cleared comments by the Staff of the Commission. That registration
statement is voluntarily filed pursuant to Section 12(g) of the Securities
Exchange Act of 1934, in order to comply with the requirements of National
Association of Securities Dealers for submission for quotation on the Over the
Counter Bulletin Board, often called "OTCBB". This Registrant's common stock is
not presently quoted on the OTCBB. The Registrant's common stock is qualified
for listing over the counter in the "Pink Sheets"; however the Registrant does
not believe that any of its shares ever traded in brokerage transactions. The
requirements of the OTCBB are that the financial statements and information
about the Registrant be reported periodically to the Commission and be and
become information that the public can access easily. This Registrant wishes to
report and provide disclosure voluntarily, and will file periodic reports in the
event that its obligation to file such reports is suspended under the Exchange
Act. If and when this 1934 Act Registration is effective and clear of comments
by the staff, this Registrant will be eligible for consideration for the OTCBB
upon submission of one or more NASD members for permission to publish quotes for
the purchase and sale of the shares of the common stock of the Registrant.
This Registrant may be the subject of a "Reverse Acquisition". A reverse
acquisition is the acquisition of a private ("Target") company by a public
company, by which the private company's shareholders acquire control of the
public company. While no negotiations are in progress, and no potential targets
have been identified, the business plan of this Registrant is to find such a
target or targets, and attempt to acquire them for stock. While no such
arrangements or plans have been adopted or are presently under consideration, it
would be expected that a reverse acquisition of a target company or business
would be associated with some private placements and/or limited offerings of
common stock of this Registrant for cash. Such placements, or offerings, if and
when made or extended, would be made with disclosure and reliance on the
businesses and assets to be acquired, and not upon the present condition of this
Registrant.
This Registrant is not presently pursuing its business plan, to seek an
acquisition partner, for the reason that such activities are not timely. They
are not timely because this Registrant must qualify itself for quotation on the
Over the Counter Bulletin Board ("OTCBB") before it can enter the arena of
seeking any business combination by reverse acquisition. The process of
qualifying for OTCBB requires first that this Registrant become a reporting
company pursuant to this 1934 Act Registration Statement. The process next
requires that a Broker/Dealer make a submission to the National Association of
Securities Dealers ("NASD") for permission to publish quotations for the
purchase and sale of the common stock of this Registrant on the OTCBB. It would
be the policy of this Registrant to employ a consultant to seek a broker/dealer
to become such a submitting market-maker in the common stock of this Registrant.
Neither this Registrant, nor any of its affiliates, are Broker/Dealers or NASD
members. Since this Registrant's common stock is presently quoted on the Pink
Sheets, it is likely that one or more existing Market-Makers would apply for
up-grade from the Pink Sheets to the OTCBB, without the necessity of this
Registrant's employing any consultants therefor. When and if an NASD member
Broker/Dealer might make such a submission to NASD, the Staff of NASD would
evaluate the submission, and the due diligence investigation, and would make
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comments and requests for further information, deemed appropriate to that Staff,
over a period of some months, before granting permission for the submitting
Market-Maker to begin publishing quotations. Until such time as permission may
be granted, no quotations would be published on the OTCBB. While quotations
might be published on the Pink Sheets, such quotations do not, in the judgment
of Management, constitute the basis for the creation or development of an
orderly trading market for the common stock of this Registrant. In arriving at
this opinion, that the Pink Sheets do not constitute the equivalent of OTCBB,
Management must consider not only its own opinion, but its assessment of the
opinions of those with whom it might evaluate a reverse acquisition.
Accordingly, Management reports its conclusion that a search for an acquisition
target is premature, and that it would remain premature for some months, until
and unless the common stock of this Registrant may be quoted on the OTCBB.
This Registrant is not ready to search for or to consider any specific
acquisition target. It does not expect to be able to begin consideration of any
acquisitions for four to six months. It cannot expect to identify or commit
itself to any acquisition within the next twelve months, or perhaps longer for
the following reasons. It is not the policy or practice of the Registrant, its
Management or Principal Shareholder to advertise, or travel in search of
possible targets. This Registrant does not command the capital or liquidity with
which to conduct such a search, and does not expect to be able to engage in any
capital formation or loan funding activities for that purpose. While incidental
advances by the Principal Shareholder for corporate maintenance, filing fees,
legal and professional, and auditing are foreseeable, the Principal Shareholder
has no intention of general funding or funding search, advertising or other
promotion of this Registrant. Accordingly, the future prospects of this
Registrant is likely to await such serendipitous referral or introduction as may
lead to conversations with potential target businesses. The search for a
profitable business combination, accordingly, must be understood as an
essentially passive one, relying mostly on word of mouth. It is possible that
business brokers or promoters may at some point approach management with a
proposal. No estimate can be made when and if such a passive search might yield
an acquisition target.
When and if a probable acquisition target may be identified, or may
identify itself, Management will conduct extensive due diligence and evaluation
of the target, based upon the financial statements of an acquisition target, its
forseeable requirements for capital, and realistic potential of the target to
attract the capital it may require, and management's evaluation of its ability
to achieve its plan for profitability. No acquisition would be made if
Management were not satisfied that its plan for profitability and viability were
sound and in the interests of shareholders. The Registrant will continue its
evaluation of opportunities until an attractive business combination is
accomplished, no matter how long it may take.
(B) DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This Registrant has no immediate need for current capital formation in its
present stage from outside sources. This means that the Registrant expects to
maintain its corporate and other filings and reports during the next twelve
months. Our common stock is cleared for the Pink Sheets, but cannot be cleared
for the OTCBB until its 1934 Act Registration shall have become effective, and
cleared comments.
The financial statements for the three months reflect minimal changes and
no substantial corporate activity. No Revenues have been recorded. Legal and
Professional expenses of $6,232 were incurred this quarter, as compared with
$22,325 for the corresponding quarter of 1999. This current amount is also
reflected as an account payable.
There has been no substantial change in our financial condition or results
of operations this quarter.
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PART II: OTHER INFORMATION
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ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGE IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
EXHIBIT INDEX
FINANCIAL STATEMENTS AND DOCUMENTS
FURNISHED AS A PART OF THIS REGISTRATION STATEMENT
Exhibit 00-FQ1: Financial Statements (Un-Audited) March 31, 2000
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-Q Report for the Quarter ended March 31, 2000, has been signed below by
the following person on behalf of the Registrant and in the capacity and on the
March 31, 2000 indicated.
Dated: March 31, 2000
DP CHARTERS, INC.
by
/s/ /s/
Kirt W. James J. Dan Sifford, Jr.
president/director secretary/director
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EXHIBIT 00-FQ1
UN-AUDITED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
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DP CHARTERS, INC.
BALANCE SHEET (UNAUDITED)
For the fiscal year ended December 31, 1999
And the three month period ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, December 31,
2000 1999
----------- --------------
ASSETS
CURRENT ASSETS $ 996 $ 996
Cash 996 996
----------- --------------
TOTAL CURRENT ASSETS
OTHER ASSETS 10,000 10,000
Accounts receivable 10,000 10,000
----------- --------------
TOTAL OTHER ASSETS $ 10,996 $ 10,996
=========== ==============
TOTAL ASSETS
LIABILITIES & STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable $ 6,232 $ 0
Advance from shareholder 10,000 10,000
----------- --------------
TOTAL LIABILITIES $ 16,232 $ 10,000
=========== ==============
STOCKHOLDERS' EQUITY
Common Stock, $.001 par value; authorized 100,000,000
shares; issued and outstanding, 27,656,000 shares,
and 27,656,000 shares respectively 27,656 27,656
Additional Paid-In Capital 205,444 205,444
Accumulater Equity (Deficit) (238,336) (232,104)
----------- --------------
Total Stockholders' Equity (5,236) 996
----------- --------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 10,996 $ 10,996
=========== ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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DP CHARTERS, INC.
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT (UNAUDITED)
For the fiscal year ended December 31, 1999
And the three month period ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C>
From
Inception on
December 18,
For the periods 1997 through
ended March 31, March 31,
2000 1999 2000
----------------- ------------ --------------
Revenues $ 0 $ 0 $ 0
----------------- ------------ --------------
Amortization 0 0 (6,000)
Organizational costs 0 (16,000) (20,000)
Net Loss from Operations (6,232) (6,325) (211,736)
Net Income (Loss) ($6,232) ($22,325) ($237,736)
================= ============ ==============
Loss per Share ($0.00023) ($0.00082) ($0.00921)
================= ============ ==============
Weighted Average
Shares Outstanding 27,656,000 27,342,150 25,814,915
================= ============ ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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DP CHARTERS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)(UNAUDITED)
For the period from inception of the Development Stage
On December 18, 1997, through December 31, 1997
For the fiscal year ended December 31, 1999
And the three month period ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Additional Accumulated Total Stock-
Common Par Paid-In Equity holders' Equity
Stock Value Capital (Deficit) (Deficit)
---------- ------- ----------- ------------- -----------------
Common Stock issued at inception 20,000,000 $20,000 $ 0 $ 0 $ 20,000
Sale of Common Stock 3,808,000 3,808 115,192 0 0
Loss during 1997 0 0 0 (152) 0
---------- ------- ----------- ------------- -----------------
Balance at December 31, 1997 23,808,000 23,808 115,192 (152) 138,848
Sale of Common Stock 2,592,000 2,592 78,408 0 0
Loss during 1998 0 0 0 (191,527) 0
---------- ------- ----------- ------------- -----------------
Balance at December 31, 1998 26,400,000 26,400 193,600 (191,679) 28,321
Sale of Common Stock 6,000 6 594 (600) 0
Sale of Common Stock 1,250,000 1,250 11,250 0 0
Loss during 1999 0 0 0 (39,825) 0
---------- ------- ----------- ------------- -----------------
Balance at December 31, 1999 27,656,000 $27,656 $ 205,444 ($232,104) $ 996
Loss during period ended
March 31, 2000 0 0 0 (6,232) 0
---------- ------- ----------- ------------- -----------------
Balance at March 31, 2000 27,656,000 27,656 205,444 (238,336) (5,236)
========== ======= =========== ============= =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
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DP CHARTERS, INC.
STATEMENTS OF CASH FLOW (UNAUDITED)
For the fiscal year ended December 31, 1999
And the three month period ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C>
From
Inception on
December 18,
For the perio 1997 through
ended March 31, March 31,
2000 1999 2000
----------------- ---------- --------------
Operating Activities
Net Income (Loss) ($6,232) ($22,325) ($237,736)
Less items not effecting cash:
shares issued for services 0 0 12,500
organization costs 0 16,000 20,000
Increase in payables 6,232 0 6,232
----------------- ---------- --------------
Net Cash from Operations -0- (6,325) (199,004)
Cash Increase (Decrease) sale of Common Stock 0 0 200,000
----------------- ---------- --------------
Net increase (decrease) in cash 0 (6,325) 996
Beginning Cash 996 12,321 0
Cash as of Statement Date $ 996 $ 5,996 $ 996
================= ========== ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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D P CHARTERS, INC.
(a Development Stage Company)
Notes to The Financial Statements
December 31, 1999 and the periods ended March 31, 1999 and 2000
NOTE I - Summary of Significant Accounting Policies
a. Organization
D P Charters, Inc., ("the Company") is a Nevada corporation organized on
December 18, 1997. The Company was formed to provide a charter yacht service
from the Dana Point harbor located in Dana Point, Orange County, California but
operations never commenced. It is the intent of management to raise capital in
order to secure business operations.
b. Accounting Method
The Company recognizes income and expenses on the accrual basis of accounting.
c. Earnings (Loss) Per Share
The computation of earnings per share of common stock is based on the weighted
average number of shares outstanding at the date of the financial statements.
d. Cash and Cash Equivalents
The Company considers all highly liquid investments with maturities of three
months or less to be cash equivalents.
e. Provision for Income Taxes
No provision for income taxes has been recorded due to net operating losses
totaling approximately $231,500 that will be offset against future taxable
income. These NOL carryforwards begin to expire in the year 2012. No tax
benefit has been reported in the financial statements because the Company
believes there is a 50% or greater chance the carryforward will expire unused.
Accordingly, per FASB 109 the potential tax benefits of the loss carryforward
are offset by the valuation of the same amount.
Deferred tax assets and the valuation account is as follows at December 31, 1999
and March 31, 2000.
March 31, December 31,
2000 1999
- ---------------------------------------------------
Deferred tax asset:
NOL carrryforward $ 80,828 $ 78,710
Valuation allowance (80,828) (78,710)
- ---------------------------------------------------
Total 0 0-
f. Organizational Costs
In 1997, the shareholders paid $20,000 in organizational costs. The Company
reimbursed the
shareholders by issuing 20,000,000 shares of common stock at $.001 par value.
These costs were being amortized on a straight-line method over a 60 month
period beginning January 1, 1998, however, during January 1999 the remaining
balance was written off in connection with a change in accounting principle (See
Note 5). These costs will be recovered only if the Company is able to generate
a positive cash flow from operations.
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D P CHARTERS, INC.
(a Development Stage Company)
Notes to The Financial Statements
December 31, 1999 and the periods ended March 31, 1999 and 2000
NOTE I - Summary of Significant Accounting Policies (continued)
g. Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the financial statements and revenues and
expenses during the reporting period. In these financial statements and other
assets involve extensive reliance on management's estimates. Actual results
could differ from those estimates.
NOTE 2 - Going Concern
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company is dependent upon raising
capital to continue operations. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty. It is
management's plan to raise additional funds to begin its intended operations.
NOTE 3 - Development Stage Company
The Company is a development stage company as defined in Financial Accounting
Standards Board Statement No. 7. It is concentrating substantially all of its
efforts in raising capital and developing its business operations in order to
generate significant revenues.
NOTE 4 - Related Party Transactions
During the first three months of 2000, during 1999 and 1998, $6,232, $10,000 and
$58,500, respectively was accrued or paid in consulting fees to a company owned
by shareholders of the Company.
During 1999, shareholders loaned the Company $13,000. The Company made payments
of $3,000 on these loans and the balance payable at December 31, 1999 is
$10,000.
During 1999, the Company advanced a shareholder $10,000. The balance of this
receivable at December 31, 1999 is $10,000.
NOTE 5 - Change in Accounting Principles
During the year ended December 31, 1999, the Company changed its method of
amortization of organizational costs in accordance with SOP 98-5 and expensed
the remaining balance. The effect of this change was to decrease net income for
the year ended December 31, 1999 by $12,000 ($0.00 per share).
NOTE 6 - Stockholders' Equity
In January 1999, the Company issued 6,000 shares of its common stock for a
subscription receivable of $600.
In April 1999, the Company issued 1,250,000 shares of its common stock for
services valued at $12,500.
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