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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended September 30, 1999
Commission File Number 0-26839
WHITE ROCK ENTERPRISES, LTD.
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(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
NEVADA 88-0407246
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(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
12507 CAMPO ROAD
SPRING VALLEY, CA 91978
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(619)699-1758
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(ISSUER'S TELEPHONE NUMBER)
SECURITIES TO BE REGISTERED UNDER SECTION 12(G) OF THE ACT:
Common Stock - .001 Par Value
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(TITLE OF CLASS)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 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 [ ]
Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10 KSB
or any amendment to this Form 10-KSB.
Yes [X] No [ ]
The corporation had no revenues for the year ended September 30, 1999.
The approximate aggregate market value of the voting stock held by
non-affiliates of the registrant as of September 30, 1999, based on the average
selling price of one share of the Common Stock of the Company, was $306,000.
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PART I
ITEM 1
DESCRIPTION OF THE BUSINESS
Business Development
White Rock Enterprises, Ltd. was incorporated in Nevada on October 8, 1998 for
the purpose of developing and marketing its only product, a boot dryer that
dries both boots and shoes for commercial and consumer use. In December 1998 the
board of directors voted to raise capital and implement the Company's business
plan. During February and March 1999 the Company raised capital through the sale
of common stock to investors in order to meet its minimum operating expense
obligations.
There have been no bankruptcy, receivership or similar proceedings.
There have been no material reclassifications, mergers, consolidations, or
purchase or sale of a significant amount of assets not in the ordinary course of
business.
Business of the Issuer
In 1996, Mr. Crooks developed the boot dryer concept and applied for a United
States Patent for the boot dryer that the Company intends to market. The patent
was granted to Mr. Crooks on October 13, 1998. On October 19, 1998, Mr. Crooks
accepted the position of President of the Company. On October 28, 1998, the
Company signed an exclusive license agreement with its President for use of his
United States Patent in exchange for 50,000 shares of the Company's common
stock. Mr. Crooks used his engineering experience and knowledge of electrical
commercial products and mold design in developing and testing the boot dryer
prototypes and master molds during evenings and weekends in his personal spare
time. This product development and testing were done as an avocational exercise
by Mr. Crooks, not the Company. Neither Mr. Crooks nor the Company were able to
accurately estimate the total development and testing costs of the product or
the market value of the product. When Mr. Crooks and the Board of Directors met
to determine the value of the license, there was a meeting of the minds based
upon individual judgement rather than quantifiable methods that 50,000 shares of
common stock were fair consideration for the license of a product that, while
ready to produce, had no precise accounting of development costs and no
guaranteed customer market. This valuation was arbitrary and bears no
relationship to assets, earnings, or market values or any other traditional
economic value.
The Company's current consumer boot dryer product is considered by Management to
be ready for marketing to retail mass marketers and sporting goods stores in
regions that receive considerable amounts of rain and snow in the Northern
United States and Canada. The Company's current commercial boot dryer product
version is considered by Management to be ready for marketing to ski and sports
rental shops in the Northern United States and Canada. The Company's product is
unique in that it circulates massive amounts of room temperature air, thereby
utilizing circulation evaporation to quickly remove the moisture from wet boots
and shoes. Other boot dryers use heat in their drying process or utilize much
slower air circulation. Utilizing the
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Company's evaporation boot dryer at room temperature, drying times are much
faster than heated boot dryers, while eliminating all of the heat damage to boot
and shoe leather associated with heated boot dryers.
Product Development
In exchange for 50,000 shares of the Company's common stock, the Company
received from the patent holder (the Company's current President) exclusive
manufacturing and marketing license agreement rights for the boot dryer that
included the completed product component designs, final master plastic injection
molds, materials sourcing, prototype models, and completed product testing for
durability, reliability, and performance. During the next twelve months the
Company intends to accomplish the following milestones: during months one
through six raise capital of $800,000 to $900,000 through the sale of securities
through a private placement offering; during months three through nine market
the Company's consumer product to retail mass marketers and sporting goods
stores and market its commercial product to ski and sports rental shops; during
month seven choose the manufacturing supplier and ship master molds and wiring
schematics to manufacturer, during months eight through ten test prototypes,
during months ten and eleven provide quality assurance review to manufacturer
and complete product modifications, during month twelve final test and approve
all components for product delivery beginning in the first quarter after month
twelve.
Manufacturing and Distribution
The Company intends to utilize available product manufacturers to produce its
boot dryer. The initial marketing efforts will require Management and
commissioned sales representatives to market the boot dryer to retail outlets
and ski and sports rental shops. Management estimates that boot dryer packaging
artwork will cost approximately $15,000 based upon discussions with local
commercial artists. Product manufacturing costs are approximately $10.00 in Asia
to approximately $15.00 in the United States per boot dryer based upon
non-binding discussions with manufacturers. Manufacturers will drop ship the
Company's product to retailers for approximately $1.50 per boot dryer based upon
non-binding discussions with manufacturers. Management estimates direct
marketing costs to be approximately $2.00 per boot dryer. Management may use
product representatives and pay them between 10% and 15% of sales to market its
product. The Company anticipates charging a wholesale price of $25.00 to $30.00,
depending on actual direct manufacturing costs. The Company cannot predict if it
will raise sufficient equity financing to commence boot dryer product
production. The Company cannot predict when it will be able to generate
significant revenues and profits from operations to continue in business or fund
anticipated growth.
Management intends to market its consumer boot dryer through retail outlets such
as WalMart, K-Mart, Target, Sportsmart, and The Sports Authority stores.
Management has no market or distribution agreements with the above retail
outlets or any other retail outlets. Management also intends to market its
commercial boot dryer through independent ski and sports rental shops in
recreational areas. Management has no market or distribution agreements with any
ski or sports rental shops. Once the Company is sufficiently funded, management
will seek out distribution agreements with retail outlets and ski and sports
rental shops.
Risk Factors
Investors in the Company should be particularly aware of the inherent risks
associated with the Company's plans and product. These risks include a lack of
independent market testing of the Company's product, lack of a proven market for
the Company's product, lack of an assured
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manufacturer of its product, lack of equity funding, the limited experience of
management, and the size of the Company compared to the size of its competitors.
Although Management intends to implement its business plan through the
foreseeable future and will do its best to mitigate the risks associated with
its business plan, there can be no assurance that such efforts will be
successful. Currently, Management is concentrating on positioning itself to
advance its business plan. Management has no liquidation plans should the
Company be unable to receive funding. Should the Company be unable to implement
its business plan, Management would investigate all options available to retain
value for the shareholders. Among the options that would be considered are: the
sale of the rights to the boot dryer, acquisition of another product or
technology, or a merger or acquisition (as a parent or target) of another
business entity that has revenue and/or long-term growth potential. There are no
pending arrangements, understandings or agreements with outside parties for
acquisitions, mergers or any other material transactions.
The current officers, Mr. Crooks and Ms. Boyd, are the sole officers, directors
and founders of the company and have control in directing the activities of the
company. They are involved in other business activities and may, in the future,
become involved in other business opportunities. If a specific business
opportunity becomes available, the officers and directors of the company may
face a conflict of interest. The Company has not formulated a plan to resolve
any conflicts that may arise.
New Products or Services
The Company has no new product or service planned or announced to the public.
Competition
The size and financial strengths of the Company's competitors, such as Air Dry
Systems, PEET, and Snap Dry, are substantially greater than those of the
Company. However, management believes that the Company can effectively compete
with those other companies because of the unique nature of its product. The
Company's uniqueness is based upon its evaporation design which uses only room
temperature and forced air movement, unlike other competitors using heat
processes or much slower air circulation. This unique feature, Management
believes, will allow the Company's boot dryer to compete effectively in the
market. Management is not aware of any significant barriers to the Company's
entry into the retail boot dryer market, however, the Company at this time
cannot ascertain its exact market share of the boot dryer product category.
Manufacturers and Suppliers
Boot dryer manufacturing is available through various suppliers such as Pegasus
in China or Avery Molding in the United States. At this time the Company has no
formal contracts with any suppliers or manufacturers and will not initiate
negotiations with any potential suppliers or manufactures until such time as the
Company has sufficient funding per its business plan.
Major Customers
The Company intends to sell its products through a variety of retail outlets to
the public and will not depend on any one or a few major customers.
Licenses
On October 28, 1998, the Company signed an exclusive license agreement with its
President for use of United States Patent number 5,819,433 for the boot dryer
product. The Company issued
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50,000 shares of its common stock in exchange for a ten year exclusive right to
development, manufacturing, marketing, sale, sub-licensing, and any and all
usages of the boot dryer in the United States and throughout the world. After
ten years the license is subject to automatic renewal each year thereafter,
subject to written notification, sixty days in advance to the renewal, by both
parties of the license agreement. The Company was formed by its two directors
for the purpose of having a corporate entity in order to design, produce, and
market the boot dryer product. The President was the creating force to design
the boot dryer and the company is the sole holder of the rights to the
intellectual property per its licensing agreement with the President.
Research & Development
All research and development costs since inception have been immaterial in cost
and will not be passed on to customers.
Government Approval
The Company does not need any governmental approval of its principal product.
The Company's business is not subject to material regulation by federal, state,
or local governmental agencies.
Employees
The Company's only employees are its two officers who will devote as much time
as the board of directors determines is necessary to manage the affairs of the
Company. The officers intend to work on a full time basis when the Company is
able to provide proper remuneration.
Year 2000 Disclosure
Computer programs that have time-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in a system
failure or miscalculations causing disruption of normal business activities.
Based on a recent and ongoing assessment, the Company has determined that any
purchased software will be off-the-shelf software that will be certified Year
2000 compatible for all of its computing requirements. The Company presently
believes that with modifications to existing off-the-shelf software or
conversions to new software, the Year 2000 issue will not pose significant
operational problems and will not materially affect future financial results.
The Company currently anticipates purchasing new off-the-shelf Year 2000
compatible software prior to any anticipated impact on operating systems. The
total cost of this new software is not anticipated to be a material expense to
the Company at this time. If, in spite of management's best efforts, these new
off-the-shelf software products are not adequately modified, resulting
date-induced systems failures could have a material adverse effect on the
Company's results of operations.
ITEM 2
DESCRIPTION OF PROPERTY
The Company's principal executive office address and telephone number are
provided by a Director of the Company at no cost. Management considers the
Company's current principal office space arrangement adequate for current and
short-term estimated growth.
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ITEM 3
LEGAL PROCEEDINGS
The Company is not currently involved in any legal proceedings and is not aware
of any pending or potential legal actions.
ITEM 4
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of the fiscal year covered by
this report to a vote of the security holders, through the solicitation of
proxies or otherwise.
PART II
ITEM 5
MARKET FOR COMMON EQUITY AND OTHER RELATED STOCKHOLDER MATTERS
The Company, upon approval of the SEC, will file for trading on the OTC
Electronic Bulletin Board which is sponsored by the National Association of
Securities Dealers (NASD). The OTC Electronic Bulletin Board is a network of
security dealers who buy and sell stock. The dealers are connected by a computer
network which provides information on current "bids" and "asks" as well as
volume information.
As of the date of this filing, there is no public market for the Company's
securities. As of September 30, 1999, the Company had 56 shareholders of record.
The Company has paid no cash dividends. The Company has no outstanding options.
The Company has no plans to register any of its securities under the Securities
Act for sale by security holders. There is no current public offering of equity.
The Board will be seeking methods of raising additional working capital during
the next twelve months. Methods under consideration by the Board include a loan
from a financial institution or a private equity or debt offering.
ITEM 6
MANAGEMENTS PLAN OF OPERATION
The Company maintains a cash balance sufficient to sustain corporate operations
until such time as Management can raise the funding necessary to advance its
business plan. The loss through September 1999 were due to operating expenses,
audit and filings fees including management fees for bookkeeping services. Sales
of the Company's equity securities have allowed the Company to maintain a
positive cash flow balance.
During the next twelve months, Management's business plan is for the Company to
take the following steps to market its boot dryer product: during months one
through six raise capital of $800,000 to $900,000 through the sale of securities
via a private placement; during months three through nine market the Company's
consumer product to retail mass marketers and sporting goods stores and market
its commercial product to ski and sports rental shops with a budget of $200,000;
during months seven through twelve complete contracts with suppliers to produce
the Company's
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product for delivery beginning in the first quarter after month twelve with a
budget of $400,000 and provide funding for operating expenses with a budget of
$100,000. Cash flow from sales is estimated to begin after the end of the next
twelve months. The Company will face considerable risk in reaching each of its
business plan milestones, such as cost overruns in each step, production delays
in manufacturing, a lack of interest in the Company's product on the part of
retailers and consumers, and a shortfall of funding due to the Company's
inability to raise capital in the equity securities market. If no funding is
received during the next twelve months, the Company will be forced to rely on
its existing cash in the bank and funds loaned by the directors and officers.
The Company's officers and directors have no formal commitments or arrangements
to advance or loan funds to the Company and no restrictions or limits have been
discussed or considered, other than the loans shall be interest free. In such a
restricted cash flow scenario, the Company would be unable to complete its
business plan steps, and would, instead, delay all cash intensive activities.
Without necessary cash flow as detailed above, the Company may be dormant during
the next twelve months, or until such time as necessary funds could be raised in
the equity market.
There are no current plans for additional product research and development.
There are no current plans to purchase or sell any significant amount of fixed
assets. The Company's business plan provides for an increase of thirty two
employees during the next twelve months.
ITEM 7
FINANCIAL STATEMENTS
The audited financial statements of the Company and related notes which are
included in this offering have been examined by Barry L. Friedman, PC, and have
been so included in reliance upon the opinion of such accountants given upon
their authority as an expert in auditing and accounting.
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
<PAGE> 9
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE #
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<S> <C>
INDEPENDENT AUDITORS REPORT F1
ASSETS F2
LIABILITIES AND STOCKHOLDERS' EQUITY F2
STATEMENT OF OPERATIONS F3
STATEMENT OF STOCKHOLDERS' EQUITY F4
STATEMENT OF CASH FLOWS F5
NOTES TO FINANCIAL STATEMENTS F6-F10
</TABLE>
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[BARRY L. FRIEDMAN, P.C. LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
Board of Directors December 15, 1999
White Rock Enterprises, Ltd.
San Diego, California
I have audited the accompanying Balance Sheets of White Rock
Enterprises, Ltd. (A Development Stage Company), as of September 30, 1999 and
the related statements of operations, stockholders' equity and cash flows for
the period October 8, 1998 (inception) to September 30, 1999. These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of White Rock
Enterprises, Ltd. (A Development Stage Company), as of September 30, 1999, and
the results of its operations and cash flows for the period October 8, 1998
(inception) to September 30, 1999, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note #5 to the
financial statements, the Company has suffered recurring losses from operations
and has no established source of revenue. This raises substantial doubt about
its ability to continue as a going concern. Management's plan in regard to these
matters is described in Note #5. These financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ BARRY L. FRIEDMAN
- ---------------------------
Barry L. Friedman
Certified Public Accountant
1582 Tulita Drive
Las Vegas, NV 89123
(702) 361-8414
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
September 30, 1999
BALANCE SHEET
ASSETS
<TABLE>
<CAPTION>
<S> <C>
CURRENT ASSETS
Cash $ 1,042
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TOTAL CURRENT ASSETS $ 1,042
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OTHER ASSETS $ 0
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TOTAL OTHER ASSETS $ 0
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TOTAL ASSETS $ 1,042
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES $ 0
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TOTAL CURRENT LIABILITIES $ 0
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STOCKHOLDERS' EQUITY (Note #4)
Common stock
Par value $0.001
Authorized 50,000,000 shares
Issued and outstanding at
September 30, 1999 -
8,160,000 shares $ 8,160
Additional Paid-In Capital -2,060
Deficit accumulated during
The Development stage -5,058
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TOTAL STOCKHOLDERS' EQUITY $ 1,042
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TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 1,042
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</TABLE>
The accompanying notes are an integral part of these financial statements
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
October 8, 1998 (inception), to September 30, 1999
STATEMENT OF OPERATIONS
<TABLE>
<S> <C>
INCOME
Revenue $ 0
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EXPENSES
Management Fee $ 100
Office Expense 742
Accounting and Audit Fees 1,500
Licenses and Fees 2,716
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TOTAL EXPENSES $ 5,058
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NET PROFIT/LOSS (-) $ -5,058
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Net Profit/Loss(-)
per weighted share
(Note #1) $ -.0006
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Weighted average
Number of common
shares outstanding 8,160,000
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</TABLE>
The accompanying notes are an integral part of these financial statements
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Additional Accumu-
Common Stock paid-in lated
Shares Amount Capital Deficit
--------- ------ ---------- -------
<S> <C> <C> <C> <C>
October 28, 1998
Issued for Services 100,000 $ 100 $ 0
March 31, 1999
Issued for Cash 60,000 60 5,940
May 15, 1999
Forward Stock Split
51:1 8,000,000 8,000 -8,000
Net loss October 8,
1998 (inception) to
September 30, 1999 -5,058
--------- ------ -------- -------
Balance,
September 30, 1999 8,160,000 $8,160 $ -2,060 $-5,058
--------- ------ -------- -------
</TABLE>
The accompanying notes are an integral part of these financial statements
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
October 8, 1998 (inception), to September 30, 1999
STATEMENT OF CASH FLOWS
<TABLE>
<S> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net Loss $-5,058
Adjustment to
Reconcile net loss
To net cash provided
by operating
Activities
Issue Common Stock
For Services +100
Changes in assets and
Liabilities 0
-------
NET CASH USED IN
OPERATING ACTIVITIES $-4,958
CASH FLOWS FROM
INVESTING ACTIVITIES 0
CASH FLOWS FROM
FINANCING ACTIVITIES
Issuance of Common
Stock for Cash +6,000
-------
Net Increase (decrease) $+1,042
Cash,
Beginning of period 0
-------
Cash, End of Period $ 1,042
-------
</TABLE>
The accompanying notes are an integral part of these financial statements
- F5 -
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized OCTOBER 8, 1998, under the laws of the State
of Nevada as WHITE ROCK ENTERPRISES, LTD. The Company currently has no
operations and in accordance with SFAS #7, is considered a development
company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method.
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 disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.
Cash and equivalents
The Company maintains a cash balance in a non-interest-bearing
bank that currently does not exceed federally insured limits.
For the purpose of the statements of cash flows, all highly
liquid investments with the maturity of three months or less are
considered to be cash equivalents. There are no cash equivalents
as of September 30, 1999.
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1999
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Income Taxes
Income taxes are provided for using the liability method of
accounting in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS #109) "Accounting for Income Taxes". A
deferred tax asset or liability is recorded for all temporary
difference between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of
deferred tax assets and liabilities.
Reporting on Costs of Start-Up Activities
Statement of Position 98-5 ("SOP 98-5"), "Reporting on the Costs
of Start-Up Activities" which provides guidance on the financial
reporting of start-up costs and organization costs. It requires
most costs of start-up activities and organization costs to be
expensed as incurred. SOP 98-5 is effective for fiscal years
beginning after December 15, 1998. With the adoption of SOP
98-5, there has been little or no effect on the company's
financial statements.
Loss Per Share
Net loss per share is provided in accordance with Statement of
Financial Accounting Standards No. 128 (SFAS #128) "Earnings Per
Share". Basic loss per share is computed by dividing losses
available to common stockholders by the weighted average number
of common shares outstanding during the period. Diluted loss per
share reflects per share amounts that would have resulted if
dilative common stock equivalents had been converted to common
stock. As of September 30, 1999, the Company had no dilative
common stock equivalents such as stock options.
Year End
The Company has selected September 30th as its fiscal year-end.
- F7 -
<PAGE> 17
WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1999
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Policy in Regards to Issuance of Common Stock in a Non-Cash Transaction
The Company's accounting policy for issuing shares in a non-cash
transaction is to issue the equivalent amount of stock equal to
the fair market value of the assets or services received.
Year 2000 Disclosure
Computer programs that have time sensitive software may
recognize a date using "00" as the year 1900 rather than the
year 2000. This could result in a system failure or
miscalculations causing disruption of normal business
activities.
The company's potential software suppliers have verified that
they will provide only certified "Year 2000" compatible software
for all of the company's computing requirements. Because the
company's products and services are sold to the general public
with no major customers, the company believes that the "Year
2000" issue will not pose significant operational problems and
will not materially affect future financial results.
NOTE 3 - INCOME TAXES
There is no provision for income taxes for the period ended
September 30, 1999, due to the net loss and no state income tax
in Nevada, the state of the Company's domicile and operations.
The Company's total deferred tax asset as of September 30, 1999
is as follows:
<TABLE>
<S> <C>
Net operation loss carry forward $5,058
Valuation allowance $5,058
Net deferred tax asset $ 0
</TABLE>
- F8 -
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WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1999
NOTE 4 - STOCKHOLDERS' EQUITY
Common Stock
The authorized common stock of the corporation consists of 50,000,000
shares with a par value $.001 per share.
Preferred Stock
The corporation has no preferred stock.
On October 28, 1998, the Company issued 100,000 shares of its $0.001 par
value common stock to its directors. Fifty thousand (50,000) shares to
one director for a license agreement and Fifty-Thousand (50,000) shares
to a director for services.
On March 31, 1999, the Company issued 60,000 shares of its $0.001 par
value common stock for cash of $6,000.00.
On May 15, 1999, the Company approved a forward stock split on the basis
of 51:1, thus increasing the common stock from 160,000 shares to
8,160,000 common shares.
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern, which contemplates
the realization of assets and liquidation of liabilities in the normal
course of business. However, the Company does not have significant cash
or other material assets, nor does it have an established source of
revenues sufficient to cover its operating costs and to allow it to
continue as a going concern. The stockholders/officers and or directors
have committed to advancing the operating costs of the Company interest
free.
- F9 -
<PAGE> 19
WHITE ROCK ENTERPRISES, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1999
NOTE 6 - RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. An
officer of the corporation provides office services without charge. Such
costs are immaterial to the financial statements and accordingly, have
not been reflected therein. The officers and directors of the Company
are involved in other business activities and may in the future, become
involved in other business opportunities. If a specific business
opportunity becomes available, such persons may face a conflict in
selecting between the Company and their other business interests. The
Company has not formulated a policy for the resolution of such
conflicts.
NOTE 7 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional
shares of common stock.
NOTE 8 - LICENSE AGREEMENT
On October 28, 1998, the Company signed an exclusive license agreement
with its President for the use of his United States Patent for a boot
dryer product. The Company issued 50,000 shares of its common stock in
exchange for a ten year exclusive right to the development,
manufacturing, marketing, sale, sublicensing, and any and all usages of
the boot dryer in the United States and throughout the world. After ten
years the license is subject to automatic renewal each year thereafter,
subject to written notification, sixty days in advance to the renewal,
by both parties of the license agreement.
- F10 -
<PAGE> 20
ITEM 8
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
CONTROL AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 9
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
The Directors and Officers of the Company, all of those whose terms will expire
at the 2000 shareholder meeting, or at such a time as their successors shall be
elected and qualified, are as follows:
<TABLE>
<CAPTION>
Name & Address Age Position Date First Elected
- -------------- --- -------- ------------------
<S> <C> <C> <C>
Dennis J. Crooks 54 President, 10/19/98
13983 Humo Drive Director
Poway, CA 92064
Sharon A. Boyd 52 Sec/Treas 10/19/98
12507 Campo Road Director
Spring Valley, CA 91978
</TABLE>
Each of the foregoing persons may be deemed a "promoter" of the Company, as that
term is defined in the rules and regulations promulgated under the securities
and Exchange Act of 1933.
Directors are elected to serve until the next annual meeting of stockholders and
until their successors have been elected and qualified. Officers are appointed
to serve until the meeting of the Board of Directors following the next annual
meeting of stockholders and until their successors have been elected and
qualified.
No Executive Officer or Director of the Corporation has been the subject of any
Order, Judgement, or Decree of any Court of competent jurisdiction, of any
regulatory agency enjoining him from acting as an investment advisor,
underwriter, broker or dealer in the securities industry, or as an affiliated
person, director or employee of an investment company, bank, savings and loan
association, or insurance company or from engaging in or continuing any conduct
or practice in connection with any such activity or in connection with the
purchase or sale of any securities nor has any such person been the subject of
any Order of a State authority barring or suspending for more than sixty (60)
days, the right of such a person to be engaged in such activities or to be
associated with such activities.
No Executive Officer or Director of the Corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending.
No Executive Officer or Director of the Corporation is the subject of any
pending legal proceedings.
8
<PAGE> 21
Resumes
Dennis J. Crooks, President & Director
1991 - Current Owner and president, Q.R.I. Corporation. Engineering
and design consulting contractor providing engineering services
in the fields of manufacturing, automotive, electrical,
mechanical, plastics, and mold construction. Responsible for
marketing, engineering certifications, engineering design, and
mold design. Supervise a staff of two to five employees in
product design and testing and prototype mold construction.
B.A. in Industrial Technology
Sharon A. Boyd, Secretary, Treasurer & Director
1994 - Current Owner and president, B.G. Consultants, Inc. Providing
bookkeeping, income tax services and sales and payroll tax
compliance to a variety of business clients including,
engineering companies, contractors, and manufacturers. Supervise
a staff of two. Her clients range in size from $100,000 to
$2,000,000 in annual revenues. Provides bookkeeping and
administrative services to Q.R.I. Corporation owned by Dennis J.
Crooks.
ITEM 10
EXECUTIVE COMPENSATION
The company's current officers receive no compensation.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Other Restricted
Name & annual stock LTIP All other
principle Salary Bonus compen- awards Options Payouts compen-
position Year ($) ($) sation($) ($) SARs ($) sation ($)
- ---------- ---- ------ ----- --------- ---------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
D. Crooks 1998 -0- -0- -0- -0- -0- -0- -0-
President
S Boyd 1998 -0- -0- -0- -0- -0- -0- -0-
Director
</TABLE>
There are no current employment agreements between the Company and its executive
officers.
The Directors and Principal Officers have worked with no remuneration until such
time as the Company receives sufficient revenues necessary to provide proper
salaries to all Officers and compensation for Directors' participation. The
Officers and the Board of Directors have the responsibility to determine the
timing of remuneration for key personnel based upon such factors as
9
<PAGE> 22
positive cash flow to include stock sales, product sales, estimated cash
expenditures, accounts receivable, accounts payable, notes payable, and a cash
balance of not less than $12,000 at each month end. When positive cash flow
reaches $12,000 at each month end and appears sustainable the board of directors
will readdress compensation for key personnel and enact a plan at that time
which will that benefits the Company as a whole. At this time, management cannot
accurately estimate when sufficient revenues will occur to implement this
compensation, or the exact amount of compensation.
There are no annuity, pension or retirement benefits proposed to be paid to
officers, directors or employees of the Corporation in the event of retirement
at normal retirement date pursuant to any presently existing plan provided or
contributed to by the Corporation or any of its subsidiaries, if any.
ITEM 11
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth information on the ownership of the Company's
voting securities by Officers, Directors and major shareholders as well as those
who own beneficially more than five percent of the Company's common stock
through the most current date - Sept. 30,1999:
<TABLE>
<CAPTION>
Title Of Name & Amount & Percent
Class Address Nature of owner Owned
- -------- ------- --------------- -------
<S> <C> <C> <C>
Common Dennis J. Crooks 2,550,000 (a) 31.3%
13983 Humo Drive
Poway, CA 92064
Common Sharon A. Boyd 2,550,000 (b) 31.3%
12507 Campo Road
Spring Valley, CA 91978
Total 5,100,000 62.6%
</TABLE>
(a) Mr. Crooks individually received for exclusive license rights 50,000 shares
of the Company's common stock on October 28, 1998, an additional 2,500,000
shares of the Company's common stock were issued to him per a stock split
on May 15, 1999.
(b) Ms. Boyd individually received for bookkeeping and administrative services
50,000 shares of the Company's common stock on October 28, 1998, an
additional 2,500,000 shares of the Company's common stock were issued to
her per a stock split on May 15, 1999.
ITEM 12
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's principal executive office address and telephone number are
provided by Sharon A. Boyd, a Director of the Company, at no cost.
10
<PAGE> 23
ITEM 13
EXHIBITS AND REPORTS ON FORM 8-K
<TABLE>
<S> <C> <C>
Exhibit 11 Statement re: computation of per share earnings See Financial Stmt.
Exhibit 23 Consent of Barry L. Friedman, P.C. Included
Exhibit 27 Financial Data Schedule Included
Reports filed on Form 8-K None
</TABLE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities and Exchange Act of
1934, the registrant caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
White Rock Enterprises, Ltd.
Date 12/20/99 By /s/ DENNIS CROOKS
------------------------------- ----------------------------------
Dennis Crooks, President & Director
Date 12/20/99 By /s/ SHARON A. BOYD
------------------------------- ----------------------------------
Sharon A. Boyd, Director
<PAGE> 1
EXHIBIT 23
[BARRY L. FRIEDMAN, P.C. LETTERHEAD]
To Whom It May Concern: December 15, 1999
The firm of Barry L. Friedman, P.C., Certified Public Accountant
consents to the inclusion of their report of December 15, 1999, on the Financial
Statements of WHITE ROCK ENTERPRISES, LTD., as of September 30, 1999, in any
filings that are necessary now or in the near future with the U.S. Securities
and Exchange Commission.
Very truly yours,
/s/ BARRY L. FRIEDMAN
- ---------------------------
Barry L. Friedman
Certified Public Accountant
1582 Tulita Drive
Las Vegas, NV 89123
(702) 361-8414
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AUDITED
FINANCIAL STATEMENTS FOR YEAR ENDED SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH WHITE ROCK ENTERPRISES, LTD.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<CASH> 1,042
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,042
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,042
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 8,160
<OTHER-SE> (2,060)
<TOTAL-LIABILITY-AND-EQUITY> 1,042
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,058
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5,058)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,058)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,058)
<EPS-BASIC> (.00)
<EPS-DILUTED> (.00)
</TABLE>
