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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2000
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 000-27949
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LA INVESTMENT ASSOCIATES, INC.
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(Exact name of small business issuer as specified in its charter)
Nevada 88-0406903
(State of other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
LA Investment Associates, Inc.
2949 East Desert Inn Road, Suite 1
Las Vegas, Nevada 89121
(702) 914-6092
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(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 [X] No [ ]
State number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date. As of June 30, 2000, 8,274,000 shares
of the registrant's $.001 par value common stock were issued and outstanding.
Transmittal Small Business Disclosure Format (check one):
Yes [X] No [ ]
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LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
AS OF JUNE 30, 2000
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LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
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CONTENTS
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PAGE 1 INDEPENDENT ACCOUNTANTS' REPORT
PAGE 2 BALANCE SHEETS AS OF JUNE 30, 2000 (UNAUDITED) AND
DECEMBER 31, 1999
PAGE 3 STATEMENTS OF OPERATIONS FOR THE THREE MONTHS AND SIX MONTHS
ENDED JUNE 30, 2000 AND 1999 AND FOR THE PERIOD FROM
JUNE 19, 1990 (INCEPTION) TO JUNE 30, 2000 (UNAUDITED)
PAGES 4 - 5 STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED
JUNE 30, 2000 AND 1999 AND FOR THE PERIOD FROM JUNE 19, 1990
(INCEPTION) TO JUNE 30, 2000 (UNAUDITED)
PAGES 6 - 7 NOTES TO FINANCIAL STATEMENTS AS OF JUNE 30, 2000 (UNAUDITED)
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INDEPENDENT ACCOUNTANTS' REPORT
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To the Board of Directors of:
LA Investment Associates, Inc.
We have reviewed the accompanying balance sheet of LA Investment Associates,
Inc. (a development stage company) as of June 30, 2000 and the related
statements of operations and cash flows for the three months and six months then
ended and for the period from June 19, 1990 (inception) to June 30, 2000. These
financial statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.
/S/ WEINBERG & COMPANY, P.A.
Boca Raton, Florida
July 28, 2000
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<TABLE>
LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
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<CAPTION>
ASSETS
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June 30, 2000 December 31,
(Unaudited) 1999
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<S> <C> <C>
CURRENT ASSETS
Cash $ 100,820 $ 1,896
Loan receivable 25,000 -
Prepaid attorney fees 12,795 12,795
Other current assets 964 -
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TOTAL ASSETS $ 139,579 $ 14,691
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LIABILITIES AND STOCKHOLDERS' EQUITY
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CURRENT LIABILITIES
Due to shareholders $ - $ 5,000
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Total Current Liabilities - 5,000
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STOCKHOLDERS' EQUITY
Common stock, $.001 par value, 25,000,000 shares
authorized, 8,274,000 and 5,110,000 shares issued and
outstanding at June 30, 2000 and December 31, 1999,
respectively 8,274 5,110
Additional paid in capital 235,646 24,810
Accumulated deficit during development stage (46,841) (20,229)
Stock subscription note receivable (50,000) -
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147,079 9,691
Less treasury stock at cost (5,000 shares) 7,500 -
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Total Stockholders' Equity 139,579 9,691
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 139,579 $ 14,691
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</TABLE>
See accompanying notes to financial statements
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<TABLE>
LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
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(UNAUDITED)
Cumulative From
For the Three For the Three For the Six For the Six June 19, 1990
Months Ended Months Ended Months Ended Months Ended (Inception) to
June 30, 2000 June 30, 1999 June 30, 2000 June 30, 1999 June 30, 2000
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<S> <C> <C> <C> <C> <C>
INCOME $ - $ - $ - $ - $ -
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EXPENSES:
Legal and professional fees 7,835 2,155 24,904 2,155 38,031
Telephone 1,357 964 2,292 964 4,565
General and administrative 1,589 152 2,941 152 7,916
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TOTAL EXPENSES 10,781 3,271 30,137 3,271 50,512
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OTHER INCOME
Dividend income 1,749 71 2,561 71 2,707
Interest income 964 - 964 - 964
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TOTAL OTHER INCOME 2,713 71 3,525 71 3,671
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NET LOSS $ (8,068) $ (3,200) $ (26,612) $ (3,200) $ (46,841)
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Net loss per common share - basic and diluted $ (0.01) $ (0.01) $ (0.01) $ (0.01) $ (0.02)
============ ============ ============ ============ ============
Weighted average number of common shares
outstanding - basic and diluted 8,172,244 2,100,000 6,666,503 2,100,000 2,414,787
============ ============ ============ ============ ============
See accompanying notes to financial statements
</TABLE>
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<TABLE>
LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
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(UNAUDITED)
<CAPTION>
Cumulative From
For the Six For the Six June 19, 1990
Months Ended Months Ended (Inception) to
June 30, 2000 June 30, 1999 June 30, 2000
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<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (26,612) $ (3,200) $ (46,841)
Adjustments to reconcile net loss to net cash used
by operating activities:
Decrease in prepaid expenses - - 7,205
Increase in other current assets (964) - (964)
Increase in accounts payable - 2,259 -
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Net cash used by operating activities (27,576) (941) (40,600)
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CASH FLOWS FROM INVESTING ACTIVITIES
Loan receivable (25,000) - (25,000)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Due to shareholder (5,000) - -
Increase in paid in capital - 4,370 4,820
Purchase of treasury shares (7,500) - (7,500)
Proceeds from common stock issuances 164,000 - 169,100
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Net cash provided by financing activities 151,500 4,370 166,420
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INCREASE IN CASH AND CASH EQUIVALENTS 98,924 3,429 100,820
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 1,896 - -
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CASH AND CASH EQUIVALENTS - END OF PERIOD $ 100,820 $ 3,429 $ 100,820
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</TABLE>
See accompanying notes to financial statements.
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LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
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(UNAUDITED)
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
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In April 2000, the Company issued 3,000,000 shares of common stock in exchange
for a note receivable of $50,000.
During 1998, the Company issued 10,000 shares of common stock for legal services
valued at $20,000 of which $7,205 has been charged to operations and $12,795 has
been recorded as a prepaid expense.
See accompanying notes to financial statements
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LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
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NOTE 1 BASIS OF PRESENTATION
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The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles and the rules
and regulations of the Securities and Exchange Commission for interim
financial information. Accordingly, they do not include all the
information necessary for a comprehensive presentation of financial
position and results of operations.
It is management's opinion, however that all material adjustments
(consisting of normal recurring adjustments) have been made which are
necessary for a fair financial statements presentation. The results for
the interim period are not necessarily indicative of the results to be
expected for the year.
For further information, refer to the financial statements and
footnotes for the year ended December 31, 1999 included in the
Company's Form 10-SB/A2 filed on April 21, 2000.
NOTE 2 LOAN RECEIVABLE
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On May 12, 2000, the Company entered into a letter of intent with Baja
Timber S.A. ("Baja"), a Mexican corporation whereby the Company will
provide financing in the form of loans totaling $25,000 to Baja as a
means of financing Baja projects. The loan to Baja bears interest at
the rate of 15% per annum and shall be for a term of 48 months or as
otherwise agreed upon by the parties. The loan is secured by a Baja
Timber stock option which gives the Company the right to purchase 50%
of the issued and outstanding shares of Baja in exchange for 500,000
restricted common shares in the Company.
NOTE 3 SUBSCRIPTIONS RECEIVABLE
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In April 2000, the Company issued 3,000,000 shares of common stock in
exchange for a $50,000 promissory note due in April 2001 and bearing
interest at 8% per annum. The $50,000 subscription note receivable is
shown as a reduction from stockholders' equity.
During March 2000, the Company received $10,000 in exchange for 10,000
shares of common stock. The check was returned for insufficient funds
due to an error on the part of the signor. This was corrected in April
2000 when the Company received payment for the stock and the common
stock was issued. The amount owed from the individual was shown as a
subscription receivable at March 31, 2000.
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LA INVESTMENT ASSOCIATES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
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NOTE 4 STOCKHOLDERS' EQUITY
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COMMON STOCK
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The Company is authorized to issue 25,000,000 shares of common stock at
$.001 par value. The Company has issued 8,274,000 shares through June
30, 2000.
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ITEM II MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS:
The following discussion of the results of operations and financial condition
should be read in conjunction with the audited financial statements and related
notes appearing under the caption "Financial Statements".
The Company did not have any revenues during the period from inception (June 9,
1990) to June 30, 2000. The Company incurred aggregate expenses of $50,512 from
inception. These expenses relate to evaluation of proposed transactions. The
Company had minor amounts of dividend and interest income that slightly reduced
its loss from the amount of expenses incurred.
Liquidity and Capital Resources
The Company had total assets of $139,579 on June 30, 2000 which came primarily
from the sale of stock in private transactions and which assets included
$100,820 in cash and a $25,000 loan receivable from Baja Timber. The Company
believes it has sufficient resources to meet its needs while evaluating business
opportunities. The Company will need to raise substantial additional capital in
order to effectuate any of the transactions it is evaluating. There is no
assurance that these efforts to raise additional capital will be successful nor
any assurance that the Company's actual capital needs will not be greater than
anticipated, or that the Company will generate revenues adequate to fund its
operations in the absence of other sources.
On May 12, 2000 the Company entered into a Letter of Intent with Baja Timber
wherein it agreed to lend a total of $25,000 to Baja Timber. Note 3 provides
details pertinent to the loan. However, management hereby discloses that the
public should consider the loan as risk money spent in an effort to bring what
could be a significant transaction to the table. There is a possibility that
these funds may not be recovered if significant other funding for the
project is not obtained.
PART II-OTHER INFORMATION
The statements in this quarterly report on Form 10-QSB that are not historical
constitute "forward-looking statements". Said forward-looking statements involve
risks and uncertainty which may cause the actual results, performance or
achievements of the Company and its subsidiaries to be materially different from
any future results, performance or achievements, express or implied by such
forward-looking statements. These forward-looking statements are identified by
their use of such terms and phrases as "expects", "intends", "goals",
"estimates", "projects", "plans", "anticipates", "should", "future", "believes",
and "scheduled".
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The variables which may cause differences include, but are not limited to, the
following: general economic and business conditions; competition; success of
operating initiatives; operating costs; advertising and promotional efforts; the
existence or absence of adverse publicity; changes in business strategy or
development plans; the ability to retain management; availability, terms, and
deployment of capital; business abilities and judgment personnel; availability
of qualified personnel; labor and employment benefit costs; availability and
costs of raw materials and supplies; and changes in, or failure to comply with
various government regulations. Although the Company believes that the
assumptions could be inaccurate, and therefore, there can be no assurance that
the forward-looking statements included in this filing will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company, or any person, that
the expectations of the Company can be achieved.
ITEM 2. CHANGES IN SECURITIES
On April 4, 2000, the Company issued 19,000 shares of its restricted
Common Stock to two individuals against a purchase price of $19,000. Again on
April 3, 2000 an additional 3,000,000 restricted common shares were sold to
Randall Prouty, currently the main officer and director of the Company, for a
$50,000 promissory note and other good and valuable consideration. These sales
were exempt from registration under the Securities Act of 1933, as amended (the
"Act") by reason of Section 4(2) of the Act as a transaction by an issuer not
involving a public offering. The shares issued in the transaction are restricted
securities under the Act.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
Exhibit Description of Exhibits
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27 Financial Data Schedule
(b) Reports on Form 8-K
None
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.
LA Investment Associates, Inc.
Date: August 9, 2000 /s/ Randall Prouty
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Randall Prouty
President, Secretary, and Director
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