U.S. Securities and Exchange Commission
Washington, DC 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ---- to ----
Commission File number 0-25947
Stanfield Educational Alternatives, Inc.
---------------------------------------
(Exact name of small business issuer as
specified in its charter)
Florida 65-0386286
----------------------- ------------
(State of other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1119 7th Avenue, Vero Beach, FL 32960
---------------------------------------
(Address of principal executive offices)
561-562-7389
------------------
(Issuer's telephone number)
Innovative Technology Systems, Inc.,131 Egret Drive, Jupiter, Florida 33458
(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 ___
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of March 10, 2000,
there were 6,100,000 shares of common stock, no par value, issued and
outstanding.
Transitional Small Business Disclosure Format (check one);
Yes __ No _X__
<PAGE>
Form 10-QSB Index
March 31, 1999
Page
Part I: Financial Information ...........................................
Item 1. Financial Statements........................................ 2
Condensed Balance Sheet (Unaudited) ...........................F-1
Condensed Statement of Operations (Unaudited) .................F-2
Condensed Statements of Cash Flow (Unaudited)..................F-3
Notes to Financial Statements..................................F-4
Item 2. Management's Discussion and Analysis or Plan of Operation .. 3
Part II: Other Information............................................. 4
Item 1. Legal Proceedings........................................ 4
Item 2. Changes in Securities.................................... 4
Item 3. Defaults Upon Senior Securities.......................... 4
Item 4. Submission of Matters to a Vote of Security Holders...... 4
Item 5. Other Information........................................ 4
Item 6. Exhibits and Reports on Form 8-K ........................ 4
Signatures............................................................... 4
2
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
<PAGE>
INNOVATIVE TECHNOLOGY SYSTEMS, INC.
(a development stage company)
CONDENSED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
---- ----
(Unaudited) *
<S> <C> <C>
ASSETS
Current assets:
Cash $ - $ -
============= =============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Loans payable related party $ 12,210 $ 8,710
------------ -------------
Stockholders' deficit:
Common stock 65,100 65,100
Deficit accumulated during the
development stage ( 77,310) ( 73,810)
------------ -------------
Total stockholders' deficit ( 12,210) ( 8,710)
------------ -------------
$ - $ -
============= =============
</TABLE>
* Condensed from audited financial statements.
See accompanying notes
F-1
<PAGE>
INNOVATIVE TECHNOLOGY SYSTEMS, INC.
(a development stage company)
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Nov. 13, 1992
(inception)
Quarter Ended Mar. 31 To Mar. 31
---------------------------
1999 1998 1999
---- ---- ----
<S> <C> <C> <C>
Sales, net $ - $ - $ -
-------- -------- --------
General and administrative expenses 3,500 - 74,317
-------- -------- --------
( 3,500) - (74,317)
-------- -------- --------
Other income (expense):
Interest expense - - ( 2,993)
-------- -------- --------
Net loss $(3,500) $ - $(77,310)
======== ======== ========
Net loss per share $ 0.00 $( 0.00)
======== ========
Number of shares used in earnings
per share computation 6,100,000 6,100,000
========= =========
</TABLE>
See accompanying notes
F-2
<PAGE>
INNOVATIVE TECHNOLOGY SYSTEMS, INC.
(a development stage company)
CONDENSED STATEMENTS OF CASH FLOW
(Unaudited)
<TABLE>
<CAPTION>
Nov.13, 1992
(inception)
Quarter Ended Mar. 31 To Mar. 31
------------------------
1999 1998 1999
---- ---- ----
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ (3,500) $ - $ (77,310)
--------- --------- ---------
Noncash issuance of debt for expenses 3,500 - 12,210
--------- --------- ---------
Noncash issuance of founder shares - - 57,250
--------- --------- ---------
Noncash compensation - - 2,750
--------- --------- ---------
Net cash provided by(used for)
for operations - - ( 5.100)
--------- --------- ---------
Cash flows from financing activities
Proceeds from issuance of common stock - - 5,100
--------- --------- ---------
Net increase in cash - - -
--------- --------- ---------
Cash, beginning of period - - -
--------- --------- ---------
Cash, end of period $ $ $
--------- --------- ---------
Supplemental disclosure:
Cash paid for interest $ - $ - $ -
--------- --------- ---------
Income taxes paid $ - $ - $ -
--------- --------- ---------
</TABLE>
See accompanying notes
<PAGE> F-3
INNOVATIVE TECHNOLOGY SYSTEMS, INC.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements of Innovative
Technology Systems, Inc. (the "Company") have been prepared
in accordance with generally accepted accounting principles
for interim financial information and with the instructions
to Form 10-Q. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered
necessary for a fair presentation have been included.
Operating results for the three-month period ended March 31,
1999 are not necessarily indicative of the results that may
be expected for the year ended December 31, 1999.
Loss per share - The Company has adopted Statement of
Financial Accounting Standards No. 128, "Earnings per Share"
("SFAS 128"), effective October 1, 1997. SFAS 128 requires
presentation of earnings or loss per share on basic and
diluted earnings per share. Loss per share is computed by
dividing net income by the weighted average number of shares
outstanding during the period. There are no potentially
dilutive shares outstanding. Restatement of the prior period
for this pronouncement had no effect on the loss per share
amount.
Development stage activities - The Company has been in the
development stage since its inception on November 13, 1992.
It has conducted no business other than organize as a
corporation. The accompanying financial statements have been
presented in accordance with generally accepted accounting
principles, which assume the continuity of the Company as a
going concern. The Company has been seeking a merger partner
and/or beginning a business that would generate profits. As
of the date of this financial statement, no definitive
arrangement has been made.
Recent accounting pronouncements - In April 1998, the
Accounting Standards Executive Committee released Statement
of Position 98-5, "Reporting on the Costs of State-Up
Activities" ("SOP 98-5"). SOP 98-5 requires that start-up
costs, including organizational costs, be expensed as
incurred. The Company has accepted early adoption of SOP 98-
5 and expensed all start-up costs.
2. CAPITALIZATION
The Company has authorized the issuance 50,000,000 shares of
common stock, having no par value. The Company's initial common
stock was issued November 13, 1992 on a gift transfer basis in
blocks of 1,000 shares to a total of 300 individuals, primarily
"accredited investors". At the same time, the organizer of the
Company received 5,425,000 shares and 275,000 shares were issued
for $100 and exchange of services. In 1996, 100,000 shares were
issued for $5,000.
3. RELATED PARTY TRANSACTIONS
The Company has no resources and all expenses to maintain
itself as a corporation have been advanced by its President
in the form of loans payable
3. INCOME TAXES
The Company has no provision for taxes as they have a net
operating loss of $77 that expires at varying times through
the year 2019 No deferred asset has been recorded as the
possibility of benefiting from the net operating loss is
dependent on the Company achieving profitable operations.
F-4
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
(a) Plan of Operation
This Quarterly Report on Form 10-QSB contains forward looking
statements. For this purpose, any statements contained in it that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the foregoing, the words "believes," "anticipates," "plans,"
and "expects," and similar expressions are intended to identify forward-
looking statements. There are a number of important factors that could cause
the Company's actual results to differ materially from those indicated by such
forward-looking statements. These factors include those set forth in the
Company's Form 10-SB registration statement under the caption "Description of
Business."
The following discussion for the Company's results of operations and
financial condition should be read in conjunction with the Company's
condensed consolidated unaudited Financial Statements listed in Part I,
Item 1 and the Notes thereto appearing elsewhere in this Form 10-QSB, and the
Company's audited Financial Statements listed in Item 13 and the Notes thereto
appearing in the Company's Form 10-SB.
During the period covered by this Report, the Company was a development
stage company conducting virtually no business operation, other than its
efforts to effect a merger, exchange of capital stock, asset acquisition
or other similar business combination (a "Business Combination") with an
operating or development stage business ("Target Business") which desired
to employ the Company to become a reporting corporation under the
Securities Exchange Act of 1934. During the period covered by this Report,
the Company had neither engaged in any operations nor generated any revenue.
It received no cash flow. The Company could not predict to what extent its
liquidity and capital resources would be diminished prior to the consummation
of a Business Combination or whether its capital would be further depleted by
its operating losses, if any, of the Target Business which the Company
effectuated a Business Combination with. No purchase or sale of significant
equipment or significant changes in the Company's number of employees occurred
prior to the consummation of a Business Combination.
During the period covered by this Report, the Company was not in a
position to meet its cash requirements for the remainder of its fiscal year
or for the next 12 months. The Company did not generate any cash revenue or
receive any type of cash flow. From inception to the period covered by this
Report, Mr. Bylsma, the Company's then sole officer and director, made loans
to the Company on a need be basis in the form of promissory notes in the
approximate amount of $12,210. The promissory notes bore simple interest at
prime plus 2%. In 1996, the balance due on the promissory notes was reduced
by $5,000 pursuant to a sale of the Company's Common Stock. The Company's
operating costs, which included professional fees and costs related to a
Business Combination, were expected to approximate $10,000 to $20,000 during
the next 12 months.
During the period covered by this Report, no commitments of any kind to
provide additional funds to the Company subsequent to a Business Combination
were made by management, other shareholders or any other third person.
3
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
Not Applicable
Item 2. Change in Securities
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Financial Data Schedule.
(b) No reports on Form 8-K were filed during the quarter ended
March 31, 1999.
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.
STANFIELD EDUCATIONAL
ALTERNATIVES, INC.,
Registrant
Date: March 20, 2000 /s/Lawrence Stanfield
-----------------------------
Lawrence Stanfield, President
4
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Balance
Sheet, Statement of Operations, Statements of Cash Flows and Notes thereto
incorporated in Part I, Item 1 of this Form 10-QSB and is qualified in
its entirety by refernce to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 12,210
<BONDS> 0
0
0
<COMMON> 65,100
<OTHER-SE> (77,310)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,500
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,500)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,500)
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
