<PAGE>2
U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE EXCHANGE ACT
For the transition period from: to:
Commission file number: 000-27251
JARRETT/FAVRE DRIVING ADVENTURE, INC.
(Exact name of Small Business Issuer in its charter)
FLORIDA 59-3564984
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
3660 Maguire Boulevard, Suite 101, Orlando Florida 32803
(Address of principal executive offices) (Zip Code)
Registrant's Telephone number, including area code: (888) 467-2231
Check mark whether the Issuer (1) has filed all reports required by
Section 13 or 15(d) of the Exchange Act 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 the filing requirements for
at least the past 90
days. YES: X NO:
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
THE PREVIOUS FIVE YEARS
Check whether the registrant filed all documents and reports required
to be filed by Section 12, 13, or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by the court.
YES: X NO:
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common stock, as of the last practicable date: 12,520,000
Transitional Small Business Disclosure Format. YES: NO: X
<PAGE>3
PART I FINANCIAL INFORMATION
Balance Sheet
March 31, 2000 4
Statements of Operations 5
Statements of Cash Flows 6
Notes to Financial Statements 7
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8-9
PART II
Other Information 10
Signatures 11
Financial Data Schedule 12
<PAGE>4
The Jarrett/Favre Driving Adventure, Inc.
Balance Sheet
March 31, 2000
ASSETS
Current assets:
Cash $ 19,114
Inventory 37,729
Prepaid expenses 9,406
-----------------
Total current assets 66,249
Property and equipment, at cost, net of
accumulated depreciation of $ 54,381 498,324
Other assets 15,425
-----------------
$ 579,998
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 5,977
Accounts payable 71,437
Accrued expenses 210,013
----------------
Total current liabilities 287,427
----------------
Loan from officer 50,000
Long-term debt 15,482
----------------
Total liabilities 352,909
----------------
Stockholders' equity:
Common stock, $ .01 par value, 100,000,000
shares authorized, 12,620,000 shares
issued and 12,520,000 outstanding 126,200
Additional paid-in capital 1,893,969
Subscribed shares 20,000
Treasury stock (100,000)
Unearned services (824,586)
Accumulated deficit (888,494)
---------------
Total stockholders' equity 227,089
---------------
$ 579,998
===============
The accompanying notes are an integral part of these financial statements.
<PAGE>5
The Jarrett/Favre Driving Adventure, Inc.
Statement of Operations
<TABLE>
<CAPTION>
Inception
(Nov. 24, 1998)
3 Mos. Ended 3 Mos. Ended 9 Mos. Ended Through
Mar. 31, Mar. 31, Mar. 31, Mar. 31,
2000 1999 2000 1999
------------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
Sales $ 124,296 $ - $ 414,429 $ -
Cost of sales 134,918 - 442,197 -
------------- ------------- ------------- -----------
Gross profit (10,622) - (27,768) -
Other costs and expenses:
Selling expenses 12,820 - 76,971 -
General and administrative 105,636 81,071 338,991 81,071
Depreciation and amortization 37,326 22,917 100,880 22,917
------------- ----------- ------------ -----------
Income (loss) from operations (166,404) (103,988) (544,610) (103,988)
Other income and (expenses):
Other income 754 - 13,278 -
Interest expense (580) - (1,652) -
------------- ----------- ----------- ----------
Income before taxes (166,230) (103,988) (532,984) (103,988)
Income taxes - - - -
------------- ----------- ----------- -----------
Net income (loss) $ (166,230) $ (103,988) $ (532,984) $ (103,988)
============= =========== =========== ===========
Per share information:
Basic (loss) per share $ (0.01) $ (0.01) $ (0.04) $ (0.01)
============= =========== =========== ==========
Weighted average shares
outstanding 12,548,500 11,571,967 12,446,009 10,089,664
============= =========== =========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>6
The Jarrett/Farve Driving Adventure, Inc.
Statement of Cash Flows
<TABLE>
<CAPTION>
Inception
(Nov. 24, 1998)
9 Mos. Ended Through
Mar. 31, 2000 Mar. 31, 1999
<S> <C> <C>
Net (loss) $ (532,984) $ (103,988)
Adjustments to reconcile net (loss) to net
cash provided by (used in) operating activities:
Depreciation and amortization 99,050 22,917
Equipment received in exchange for sponsorship (137,830) -
Issuance of stock in exchange for services - 60,000
Changes in assets and liabilities:
(Increase) decrease in inventory (23,333) -
(Increase) decrease in prepaid expenses 15,604 -
(Increase) decrease in other assets (3,226) -
Increase (decrease) in accounts payable and
accrued expenses 216,915 17,431
------------ ------------
Total adjustments 167,180 100,348
------------ ------------
Net cash (used in) operating activities (365,804) (3,640)
------------ ------------
Cash flows (used in) investing activities:
Acquisition of property and equipment (35,995) -
------------ ------------
Net cash (used in) investing activities (35,995) -
------------ ------------
Cash flows from financing activities:
Common stock sold for cash 348,500 381,000
Loan from officer 50,000 -
Purchase of treasury stock (100,000) -
Repayment of long term debt (3,607) -
----------- -----------
Net cash from financing activities 294,893 381,000
----------- -----------
Increase (decrease in cash) (106,906) 377,360
Cash and equivalents, beginning of period 126,020 -
------------- ----------
Cash and equivalents, end of period $ 19,114 $ 377,360
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>7
The Jarrett/Favre Driving Adventure, Inc.
Notes to Financial Statements
March 31, 2000
Basis of Presentation
The accompanying condensed unaudited financial statements have been
prepared in accordance with U.S. generally accepted accounting
principles for interim financial information and with the instructions
to form 10-GSB. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring
adjustments) considered necessary for a fair presentation have been
included.
The results of operations for the periods presented are not
necessarily indicative of the results to be expected for the full
year. The accompanying financial statements should be read in
conjunction with the Company's form 10-KSB filed for the period ended
June 30, 1999.
Stockholders' Equity
Basic loss per share was computed using the weighted average number of
common shares outstanding.
During the three months ended March 31, 2000, the Company issued a
subscription for 20,000 shares of restricted common stock in partial
exchange for three racecars.
Track Operations
The Company commenced operations on July 2, 1999. During the three
months ended March 31, 2000, the Company generated $ 108,183 in
revenues from track operations.
Sponsorship Revenue
During the three month period ended March 31, 2000, the Company
recognized sponsorship revenue in the amount of $ 24,830. The
sponsoring corporation provided the Company with equipment used in
operations.
Equipment Purchases
During the three months ended March 31, 2000, the Company purchased
four (4) additional racecars to be used in track operations. These
vehicles were purchased by the payment of cash in the amount of $
18,500 and the issuance of a subscription for 20,000 shares of
restricted common stock.
<PAGE>8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations:
Trends and Uncertainties. Demand for Jarrett/Favre's products are
dependent on, among other things, general economic conditions, which
are cyclical in nature. Inasmuch as a major portion of
Jarret/Favre's activities are the receipt of revenues from its
driving school services and products, Jarrett/Favre's business
operations may be adversely affected by Jarrett/Favre's competitors
and prolonged recessionary periods.
There are no known trends, events or uncertainties that have or are
reasonably likely to have a material impact on Jarrett/Favre's short
term or long term liquidity. Sources of liquidity both internal and
external will come from the sale of Jarrett/Favre's products as well
as the private sale of the company's stock. There are no material
commitments for capital expenditure at this time.
There are no trends, events or uncertainties that have had or are
reasonably expected to have a material impact on the net sales or
revenues or income from continuing operations.
There are no significant elements of income or loss that do not arise
from Jarrett/Favre's continuing operations.
There are no known causes for any material changes from period to
period in one or more line items of Jarrett/Favre's financial
statements.
Jarrett/Favre does not anticipate any seasonality for its revenue
stream.
Capital and Source of Liquidity. Jarrett/Favre currently has no
material commitments for capital expenditures. Jarrett/Favre has no
plans for future capital expenditures such as additional race cars at
this time.
Jarrett/Favre anticipates in addition to revenues to raise additional
capital to conduct operations during the next twelve(12) months. The
company intends to raise the necessary capital through the private
sale of stock. Jarrett/Favre believes that there will be sufficient
capital from revenues and the private sale of stock to conduct
operations for the next twelve(12) months.
Presently, Jarrett/Favre's revenue comprises fifty(50) percent of the
total cash necessary to conduct operations. The remaining fifty(50)
percent of the cash necessary to conduct operations will come from the
private sale of stock. Future revenues from classes and events will
determine the amount of offering proceeds necessary to continue
operations.
The board of directors has no immediate offering plans in place. The
board of directors shall determine the amount and type of offering as
Jarrett/Favre's financial situation dictates.
For the nine months ended March 31, 2000, Jarrett/Favre acquired
plant and equipment of $35,995 resulting in net cash used in investing
activities of $35,995.
For the period from inception through March 31, 1999, Jarrett/Favre
had no investing activities.
For the nine months ended March 31, 2000, Jarrett/Favre sold
common stock for $348,500, purchased treasury stock of $100,000 and
repaid $3,607 of long-term debt. Additionally, Jarrett/Favre received
a loan from an officer of $50,000. As a result, Jarrett/Favre had
net cash provided by financing activities of $294,893 for the nine
months ended March 31, 2000.
For the period from inception through March 31, 1999, Jarrett/Favre
received $381,000 from the sale of its common stock resulting in net
cash from financing activities of $381,000.
On a long term basis, liquidity is dependent on continuation of
operation and receipt of revenues.
Results of Operations. For the nine months ended March 31,
2000, Jarrett/Favre had sales of $414,429 and cost of sales of
$442,197 resulting in gross profit of $(27,768).
<PAGE>9
For the nine months ended March 31, 2000, Jarrett/Favre had
general and administrative expenses of $338,881. These expenses
consisted primarily of salaries-officers of $90,000, salaries-other of
$109,609, payroll taxes & benefits of $29,367, professional fees of
$18,571, rent of $21,072, telephone expense of $26,217, equipment
rental of $4,435, office supplies of $4,729, postage of $7,498,
printing of $5,291, licenses and fees of $1,698, meals and
entertainment of $1,735, bank/credit card charges of $8,201, web site
expense of $5,937 and other expense of $4,631.
For the period from inception through March 31, 1999, Jarrett/Favre
had general and administrative expenses of $81,071. These expenses
consisted primarily of salaries-officers of $60,000, salaries-other of
$3,533, payroll taxes & benefits of $394, professional fees of $5,000,
consulting services of $6,091 and other expense of $6,053.
Jarrett/Favre shall focus on limiting its administrative costs.
Plan of Operation. Jarrett/Favre may experience problems;
delays, expenses and difficulties sometimes encountered by an
enterprise in Jarrett/Favre's stage of development, many of which are
beyond Jarrett/Favre's control. These include, but are not limited
to, unanticipated problems relating to additional costs and expenses
that may exceed current estimates and competition.
Jarrett/Favre is not delinquent in any of its obligations.
Jarrett/Favre intends to market its products and services utilizing
cash made available from the private sale of its securities and
operations. Jarrett/Favre's management is of the opinion that the
proceeds of the sales of its securities and future revenues will be
sufficient to pay its expenses for the next twelve months.
<PAGE>10
PART II
OTHER INFORMATION
ITEM 1, LEGAL PROCEEDINGS.
Not applicable.
ITEM 2. CHANGES 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.
<PAGE>11
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
Jarrett/Favre Driving Adventure, Inc.
(Registrant)
Date. May 14, 2000
By: /s/Timothy Shannon
---------------------
Timothy Shannon, President
<TABLE> <S> <C>
<ARTICLE> 5
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-END> MAR-31-2000
<CASH> 19,114
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 37,729
<CURRENT-ASSETS> 66,249
<PP&E> 498,324
<DEPRECIATION> 54,381
<TOTAL-ASSETS> 579,998
<CURRENT-LIABILITIES> 287,427
<BONDS> 0
<COMMON> 126,200
0
0
<OTHER-SE> 100,889
<TOTAL-LIABILITY-AND-EQUITY> 579,998
<SALES> 414,429
<TOTAL-REVENUES> 414,429
<CGS> 442,197
<TOTAL-COSTS> 442,197
<OTHER-EXPENSES> 516,842
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (532,984)
<INCOME-TAX> 0
<INCOME-CONTINUING> (532,984)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (532,984)
<EPS-BASIC> (0.04)
<EPS-DILUTED> (0.04)
</TABLE>
