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 December 31, 1999.
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the transition period from ------------ to --------------
Commission file number: 0-27831
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GENESIS CAPITAL CORPORATION OF NEVADA
--------------------------------------
(Exact name of small business issuer as specified in its charter)
Nevada 91-1947658
-------- -----------
State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
11701 South Freeway, Burleson, Texas 76028
------------------------------------------
(Address of principal executive office) (Zip Code)
(817) 293-9334
----------------------
(Issuer's telephone number)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes XX No
---- ----
The number of outstanding shares of the issuer's common stock, $0.001
par value, as of December 31, 1999 was 2,067,911 and the total number of the
issuer's preferred stock, $.001 par value, was 932,755.
<PAGE>
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS..................................................3
Condensed Balance Sheets as of September 30, 1999
and December 31, 1999..........................................4
Condensed Statements of Operations
for the Three Month Periods Ended
December 31, 1999 and 1998.....................................5
Condensed Statements of Cash Flows
for the Three Month Periods Ended
December 31, 1999 and 1998.....................................6
Condensed Statements of Stockholder's Equity
for the Three Month Period Ended
December 31, 1999 and 1998.....................................7
Notes to Unaudited Condensed Financial Statements.....................8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS..................................9
PART II - OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS......................................................10
ITEM 2 CHANGES IN SECURITIES..................................................10
ITEM5 OTHER INFORMATION.......................................................10
INDEX TO EXHIBITS.............................................................12
[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]
2
<PAGE>
PART I
ITEM 1. FINANCIAL STATEMENTS
As used herein, the term "Company" refers to Genesis Capital
Corporation of Nevada., a Nevada corporation, and its subsidiaries and
predecessors unless otherwise indicated. Consolidated, unaudited, condensed
interim financial statements including a balance sheet for the Company as of the
quarter ended December 31, 1999 and statements of operations, statements of
shareholders equity and statements of cash flows for the interim period up to
the date of such balance sheet and the comparable period of the preceding year
are attached hereto as Pages 3 through 8 and are incorporated herein by this
reference.
[THIS SPACE HAS BEEN LEFT BLANK INTENTIONALLY]
3
<PAGE>
Genesis Capital Corporation of Nevada
Unaudited Condensed Balance Sheet
December 31, September 30,
1999 1999
-------------- -------------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash in Bank $ - $ -
---------- -----------
Total current assets - -
Investments - -
Investment in Real Estate 600,000 600,000
---------- -----------
Deferred Tax Benefit 5,190 4,619
---------- -----------
TOTAL ASSETS $ 605,190 $ 604,619
========== ===========
LIABILITIES
Current Liabilities: $ $
Accrued Property Taxes 35,967 32,158
---------- -----------
Total Current Liabilities 35,967 32,158
STOCKHOLDERS' EQUITY
Preferred stock ($.001 par value,
10,000,000 shares authorized;
with 182,755 share issued and
outstanding 183 933
Common stock ($.001 par value
50,000,000 shares authorized;
with 2,067,911 shares issued
and outstanding 2,068 2,068
Additional paid in capital 9,195,579 9,194,829
Retained Earnings (8,628,607) (8,625,369)
---------- -----------
Total stockholders' equity 569,223 572,461
TOTAL LIABILITIES AND EQUITY $ 605,190 $ 604,619
========== ============
See notes to financial statements
4
<PAGE>
Genesis Capital Corporation of Nevada
Unaudited Condensed Statements of Operations
Three Months Ended
December 31,
1999 1998
----------------- ---------------
REVENUES
Revenues $ - $ -
------------ ------------
Total Revenue - -
Property Taxes 3,809 4,231
General and Administrative
Expenses - -
------------ ------------
Total Expenses 3,809 4,231
Net Income Before Tax (3,809) (4,231)
Income Tax Benefit 571 -
------------ ------------
Net Income (Loss) $ (3,238) $ (4,231)
============ ============
Earnings Per Share - Basic
Net Income (Loss) per Share $ (0.001) (2)
Earnings Per Share - Diluted
Net Income (Loss) per Share (0.001) (0.001)
Weighted Average Shares Outstanding 2,067,911 2,766
Weighted Average Shares Outstanding
(Diluted) 3,895,461 3,347,290
(Retroactively Restated)
See notes to financial statements
5
<PAGE>
Genesis Capital Corporation of Nevada
Unaudited Condensed Statements of Cash Flows
Three Months Ended
December 31
1999 1998
-------------- -------------
CASH FLOWS FROM OPERATION ACTIVITIES
Net Income per Income Statement $ (3,238) $ (4,231)
Adjustments:
Depreciation
Escrow Deposit
Loan Receivable
Accrued Property Taxes 3,809 4,231
Deferred Income Tax Benefit (571)
Accounts Receivable
-------- ----------
Total from Operating Activities 3,238 -
-------- ----------
Cash Flows - Investing Activities - -
Fixed assets
-------- ----------
Total for Investing Activities - -
Cash Flows - Financing Activities
Common Stock/Paid-In-Capital - -
Other - -
-------- ----------
Total From Financing Activities - -
Increase in Cash - -
Cash Balance, Begin of Year - -
-------- ----------
Cash Balance, End of Year - -
======== ==========
Supplement Disclosure:
Cash paid during year for:
Interest - -
Income taxes - -
See notes to financial statements
6
<PAGE>
<TABLE>
<CAPTION>
Genesis Capital Corporation of Nevada
Statement of Stockholders' Equity
Common Stock Preferred Stock Additional Paid- Accumulated
Shares At Par Shares At Par -in-Capital Deficit Total
<S> <C> <C> <C> <C> <C> <C> <C>
Balance October 1, 1999 2,067,911 $ 2,068.00 932,755 $ 933.00 $ 9,194,829 $ (8,625,369) $ 572,461
--------------- -------------- ------------ ------------- ------------- ---------------- -----------
Stock Cancellation (750,000) $ (750.00) $ 750
--------------- -------------- ------------ ------------- ------------- ---------------- -----------
Net Income (Loss) $ (3,238) $ (3,238)
--------------- -------------- ------------ ------------- ------------- ---------------- -----------
Balance December 31, 1999 2,067,911 $ 2,068.00 182,755 $ 333.00 $ 9,195,579 $ (8,628,607) $ 569,223
=============== ============== ============ ============= ============= ================ ===========
</TABLE>
See notes to financial statements
7
<PAGE>
Genesis Capital Corporation of Nevada
Notes to unaudited consolidated financial statements
December 31, 1999
NOTE 1 - SUMMARY OF ACCOUNTING POLICIES
a. Organization
The Company is a shell company that has had no active business
operations for the past three years.
b. Basic Loss Per Share
Basic loss per share has been calculated based on the weighted average
number of shares of common stock outstanding during the period.
c. Income Taxes
As of December 31, 1999, the Company has a tax loss carry forward in
the amount of $46,906 for federal tax income purposes that may be used
in the future to offset taxable income. The tax loss carryforward will
begin to expire in 2014. For more information concerning the Company's
income taxes, please see the financial statements contained in its Form
10-SB on file with the SEC.
d. 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 revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
e. Marketable Securities - Available for Sale
The Company has classified its marketable securities as
"available-for-sale" securities. Trading securities are stated at fair
value. Unrealized gains and losses are reported as a separate component
of equity.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This Quarterly Report contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, which are intended to be
covered by the safe harbors created thereby. Investors are cautioned that all
forward- looking statements involve risks and uncertainty , including without
limitation, the ability of the Company to continue its expansion strategy,
changes in costs of raw materials, labor, and employee benefits, as well as
general market conditions, competition and pricing. Although the Company
believes that the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could be inaccurate, and
therefore, there can be no assurance that the forward-looking statements
included in this Quarterly Report will prove to be accurate. In light of the
significant uncertainties inherent in the forward- looking statements including
herein, the inclusion of such information should not be regarded as are
presentation by the Company or any other person that the objectives and plans of
the Company will be achieved.
As used herein the term "Company" refers to Genesis Capital Corporation of
Nevada, a Nevada corporation and its predecessors, unless the context indicates
otherwise. The Company is currently a shell company whose purpose will be to
acquire operations through an acquisition, merger or begin its own start-up
business.
The Company is in the process of attempting to identify and acquire a favorable
business opportunity. The Company has reviewed and evaluated a number of
business ventures for possible acquisition or participation by the Company. The
Company has not entered into any agreement, nor does it have any commitment or
understanding to enter into or become engaged in a transaction as of the date of
this filing. The Company continues to investigate, review, and evaluate business
opportunities as they become available and will seek to acquire or become
engaged in business opportunities at such time as specific opportunities
warrant.
Results of Operations
The Company had no sales revenues for the three months ended December 31, 1999
or 1998. The Company had no sales for the three months ended December 31, 1999
or 1998 because it is a shell company that has not had any business operations
for the past three years.
The Company had no costs of sales revenues for the three months ended December
31, 1999 or 1998 because it is a shell company that has not had any business
operations for the past three years.
The Company had no general and administrative expenses for the three months
period ended December 31, 1999 or for the same period in 1998.
The Company recorded net income loss of $3,238 for the three months ended
December 31, 1999 compared to$ 4,231 loss for the same period in 1998.
Capital Resources and Liquidity
At December 31, 1999, the Company had total current assets of $0 and total
assets of $605,190 as compared to $0 current assets and $604,619 total assets at
September 30, 1999. The Company had a net working capital deficit of $35,967 at
December 31, 1999 as compared to a working capital deficit of $32,158 at
September 30, 1999.
9
<PAGE>
Net stockholders' deficit in the Company was $569,223 as of December 31, 1999,
as compared to $572,461 as of September 30, 1999.
PART II-OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On September 30, 1999, Biorelease Corporation filed a petition in the district
court of Harris County, Texas, 269th judicial district, involving a March 1994
contract with Genesis by which 150,000 shares of Genesis preferred stock were
given to Biorelease in exchange for 1.5 million shares of its common stock.
Biorelease has sought relief in the form of an injunction preventing transfer of
its 1.5 million shares, or rescission of the contract, or damages of $1,300,000.
On January 13, 2000, a Final Judgement was entered recinding the contract as
described above.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On December, 19, 1999, the Company canceled 150,000 shares of its preferred
stock issued to Biorelease Corporation.
In December of 1999, the company canceled a total of 600,000 shares of its
preferred sock as follows:
No. of Shares
Name Canceled
-----------------------------------------
Henry Simon 150,000
David Newren 150,000
Ronald Wellborn 150,000
Richard Surber 75,000
A-Z Professional
Consultants, Inc. 75,000
- ------------------------------------------
ITEM 5. OTHER INFORMATION
None.
10
<PAGE>
ITEM 6. EXHIBITS
(a) Exhibits. Exhibits required to be attached by Item 601 of Regulation S-B
are listed in the Index to Exhibits on page 12 of this Form 10-QSB, and
are incorporated herein by reference.
(b) Reports on Form 8-K. No reports on Form 8-K were filed during the period
covered by this Form 10-QSB.
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, this 9th day of February 2000.
GENESIS CAPITAL CORPORATION OF NEVADA
/s/ Reginald Davis
- ----------------------------
Reginald Davis February 9, 2000
President/ CEO and Director
11
<PAGE>
EXHIBIT INDEX
Exhibit No. Page No. Description
27 13 Financial Data Schedule "CE"
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED DECEMBER 31, 1999 THAT
WERE FILED WITH THE COMPANY'S REPORT ON FORM 10-QSB AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001083383
<NAME> Genesis Capital Corporation of Nevada
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-1-1999
<PERIOD-END> DEC-31-1999
<EXCHANGE-RATE> 1
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 605,190
<CURRENT-LIABILITIES> 35,967
<BONDS> 0
0
183
<COMMON> 2,068
<OTHER-SE> 566,972
<TOTAL-LIABILITY-AND-EQUITY> 605,190
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 3,809
<OTHER-EXPENSES> (571)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,238)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,238)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,238)
<EPS-BASIC> (.001)
<EPS-DILUTED> (.001)
</TABLE>
