U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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: September 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 333-40790
NEW PARADIGM PRODUCTIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA 87-0640467
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1393 Luckspring Drive, Salt Lake City, Utah 84016
(Address of principal executive offices)
(801) 466-9096
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since
last report)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such report(s) YES [X] NO [ ]
and (2) has been subject to such filing requirements for the past 90 days.
YES [ ] NO [X]
The number of $.001 par value common shares outstanding at September 30, 2000:
1,000,000
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
See attached.
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
CONTENTS
PAGE
Unaudited Condensed Balance Sheets,
September 30, 2000 and December 31,
1999 2
Unaudited Condensed Statements of
Operations, for the three and nine
months ended September 30, 2000 and
from inception on October 1, 1999
through September 30, 2000 3
Unaudited Condensed Statements of Cash
Flows, for the nine months ended
September 30, 2000 and from inception
on October 1, 1999 through September 30,
2000 4
Notes to Unaudited Condensed Financial
Statements 5 - 8
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
September 30, December 31,
2000 1999
___________ ___________
CURRENT ASSETS:
Cash $ 5,556 $ 2,347
Prepaid expense 2,751 -
Inventory 841 -
___________ ___________
Total Current Assets 9,148 2,347
EQUIPMENT, net 3,025 -
OTHER ASSETS:
Deferred stock offering costs 5,000 -
___________ ___________
$ 17,173 $ 2,347
____________ ____________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable - related party $ 10,000 $ -
Accrued expenses 3,759 -
___________ ___________
Total Current Liabilities 13,759 -
___________ ___________
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value,
1,000,000 shares authorized,
no shares issued and outstanding - -
Common stock, $.001 par value,
24,000,000 shares authorized,
1,000,000 and 900,000 shares
issued and outstanding 1,000 900
Capital in excess of par value 39,000 4,100
Deficit accumulated during the
development stage (36,586) (2,653)
___________ ___________
Total Stockholders' Equity 3,414 2,347
___________ ___________
$ 17,173 $ 2,347
___________ ___________
Note: The Balance Sheet as of December 31, 1999, was taken from the
audited financial statements at that date and condensed.
The accompanying notes are an integral part of these unaudited
condensed financial statements.
2
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
From Inception
For the Three For the Nine on October 1,
Months Ended Months Ended 1999 Through
September 30, September 30, September 30,
2000 2000 2000
____________ ____________ ____________
REVENUE $ 839 $ 839 $ 839
COST OF GOODS SOLD 181 181 181
____________ ____________ ____________
GROSS PROFIT 658 658 658
EXPENSES:
General, Selling and
Administrative 13,918 34,591 37,244
____________ ____________ ____________
LOSS BEFORE INCOME TAXES (13,260) (33,933) (36,586)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
____________ ____________ ____________
NET LOSS $ (13,260) $ (33,933) $ (36,586)
____________ ____________ ____________
LOSS PER COMMON SHARE $ (.01) $ (.03) $ (.04)
____________ ____________ ____________
The accompanying notes are an integral part of these unaudited
condensed financial statements.
3
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
From Inception
For the Nine on October 1,
Months Ended 1999 Through
September 30, September 30,
2000 2000
____________ ____________
Cash Flows From Operating Activities:
Net loss $ (33,933) $ (36,586)
Adjustments to reconcile net loss to
net cash used by operating
activities:
Depreciation expense 211 211
Changes in assets and liabilities:
(Increase) in inventory (841) (841)
(Increase) in prepaid expenses (2,750) (2,750)
Increase in accounts payable
- related party 10,000 10,000
Increase in accrued expenses 3,758 3,758
____________ ____________
Net Cash (Used) by Operating
Activities (23,555) (26,208)
____________ ____________
Cash Flows From Investing Activities:
Purchase of equipment (3,236) (3,236)
____________ ____________
Net Cash (Used) by Investing
Activities (3,236) (3,236)
____________ ____________
Cash Flows From Financing Activities:
Proceeds from issuance of common stock 35,000 40,000
Stock offering costs (5,000) (5,000)
____________ ____________
Net Cash Provided by Financing
Activities 30,000 35,000
____________ ____________
Net Increase in Cash 3,209 5,556
Cash at Beginning of Period 2,347 -
____________ ____________
Cash at End of Period $ 5,556 $ 5,556
____________ ____________
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest $ - $ -
Income taxes $ - $ -
Supplemental Schedule of Noncash Investing and Financing Activities:
For the nine months ended September 30, 2000:
None
The accompanying notes are an integral part of these unaudited
condensed financial statements.
4
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - New Paradigm Productions, Inc. (the Company) was
organized under the laws of the State of Nevada on October 1,
1999. The Company plans to manufacture and sell products related
to self improvement and meditation. The Company has not yet
generated significant revenues from its planned principal
operations and is considered a development stage company as
defined in the Statement of Financial Accounting Standards (SFAS)
No. 7. The Company has, at the present time, not paid any
dividends and any dividends that may be paid in the future will
depend upon the financial requirements of the Company and other
relevant factors.
Condensed Financial Statements - The accompanying financial
statements have been prepared by the Company without audit. In
the opinion of management, all adjustments (which include only
normal recurring adjustments) necessary to present fairly the
financial position, results of operations and cash flows at
September 30, 2000 and for the periods then ended have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
It is suggested that these condensed financial statements be read
in conjunction with the financial statements and notes thereto
included in the Company's December 31, 1999 audited financial
statements. The results of operations for the periods ended
September 30, 2000 are not necessarily indicative of the
operating results for the full year.
Organization Costs - The Company expensed organization costs of
$885, which reflect amounts expended to organize the Company.
Loss Per Share - The computation of loss per share is based on
the weighted average number of shares outstanding during the
period presented in accordance with Statement of Financial
Accounting Standards No. 128, "Earning Per Share" [See Note 7].
Cash and Cash Equivalents - For purposes of the financial
statements, the Company considers all highly liquid debt
investments purchased with a maturity of three months or less to
be cash equivalents.
Accounting 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, the disclosures of
contingent assets and liabilities at the date of the financial
statements, and the reported amount of revenues and expenses
during the reported period. Actual results could differ from
those estimated.
Recently Enacted Accounting Standards - Statement of Financial
Accounting Standards (SFAS) No. 136, "Transfers of Assets to a
not for profit organization or charitable trust that raises or
holds contributions for others", SFAS No. 137, "Accounting for
Derivative Instruments and Hedging Activities - deferral of the
effective date of FASB Statement No. 133 (an amendment of FASB
Statement No. 133.),", SFAS No. 138 "Accounting for Certain
Derivative Instruments and Certain Hedging Activities - and
Amendment of SFAS No. 133", SFAS No. 139, "Recission of SFAS No.
53 and Amendment to SFAS No 63, 89 and 21", and SFAS No. 140,
"Accounting to Transfer and Servicing of Financial Assets and
Extinguishment of Liabilities", were recently issued SFAS No.
136, 137, 138, 139 and 140 have no current applicability to the
Company or their effect on the financial statements would not
have been significant.
5
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Continued]
Advertising Costs - The Company expensed $6,729 in advertising
costs during the nine month period ended September 30, 2000.
NOTE 2 - EQUIPMENT
The Company utilizes straight-line depreciation over a five year
period.
September 30, December 31,
2000 1999
___________ ___________
Office equipment $ 3,236 $ -
___________ ___________
-
Less: Accumulated Depreciation 211 -
___________ ___________
Net Equipment $ 3,025 $ -
___________ ___________
Depreciation expense for the period ended September 30, 2000 and
year ended December 31, 1999 was $211 and $0, respectively.
NOTE 3 - CAPITAL STOCK
Common Stock - During October 1999, in connection with its
organization, the Company issued 900,000 shares of its previously
authorized, but unissued common stock. Total proceeds from the
sale of stock amounted to $5,000 (or $.0056 per share).
During January and February 2000, the Company raised $35,000
through the sale of 100,000 shares of its previously authorized,
but unissued common stock in a private placement ($.35 per
share).
Preferred Stock - The Company has authorized 1,000,000 shares of
preferred stock, $.001 par value, with such rights, preferences
and designations and to be issued in such series as determined by
the board of Directors. No shares are issued and outstanding at
September 30, 2000.
6
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 4 - INCOME TAXES
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes". SFAS No. 109 requires the Company to provide
a net deferred tax asset/liability equal to the expected future
tax benefit/expense of temporary reporting differences between
book and tax accounting methods and any available operating loss
or tax credit carryforwards. At September 30, 2000, the Company
has available unused operating loss carryforwards of
approximately $36,500, which may be applied against future
taxable income and which expire in 2020.
The amount of and ultimate realization of the benefits from the
operating loss carryforwards for income tax purposes is
dependent, in part, upon the tax laws in effect, the future
earnings of the Company, and other future events, the effects of
which cannot be determined. Because of the uncertainty
surrounding the realization of the loss carryforwards the Company
has established a valuation allowance equal to the tax effect of
the loss carryforwards and, therefore, no deferred tax asset has
been recognized for the loss carryforwards. The net deferred tax
assets are approximately $12,400 as of September 30, 2000, with
an offsetting valuation allowance at September 30, 2000 of the
same amount resulting in a change in the valuation allowance of
approximately $11,500 for the nine months ended September 30,
2000.
NOTE 5 - RELATED PARTY TRANSACTIONS
Office Space - The Company has not previously had a need to rent
office space. An officer/shareholder of the Company has allowed
the Company to use her home as a mailing address, as needed, at
no expense to the Company. However, the Company has agreed to
pay rent of $334 per month, to an officer of the Company,
beginning on March 16, 2000. The Company expensed $2,763 and $0
for the period ended September 30, 2000 and year ended December
31, 1999, respectively.
Management Compensation - The Company has entered in to an
agreement with an officer to pay compensation of $2,000 per month
beginning on March 17, 2000. As of September 30, 2000, the total
amount paid to this officer was $13,000.
NOTE 6 - GOING CONCERN
The accompanying financial statements have been prepared in
conformity with generally accepted accounting principles, which
contemplate continuation of the Company as a going concern.
However, the Company has incurred losses since its inception and
has not yet been successful in establishing profitable
operations. These factors raise substantial doubt about the
ability of the Company to continue as a going concern. In this
regard, management is proposing to raise any necessary additional
funds not provided by operations through additional sales of its
common stock. There is no assurance that the Company will be
successful in raising this additional capital or achieving
profitable operations. The financial statements do not include
any adjustments that might result from the outcome of these
uncertainties.
7
<PAGE>
NEW PARADIGM PRODUCTIONS, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 7 - LOSS PER SHARE
The following data show the amounts used in computing loss per
share for the periods ended September 30, 2000:
From Inception
For the Three For the Nine on October 1,
Months Ended Months Ended 1999 Through
September 30, September 30, September 30,
2000 2000 2000
____________ ____________ ____________
Loss from continuing
operations available
to common shareholders
(numerator) $ (13,260) $ (33,933) $ (36,586)
____________ ____________ ____________
Weighted average
number of common
shares outstanding
used in computing
loss per share for
the period
(denominator) 1,000,000 989,234 966,986
____________ ____________ ____________
Dilutive earnings per share was not presented, as the Company had
no common equivalent shares for all periods presented that would
effect the computation of diluted earnings (loss) per share.
NOTE 8 - SUBSEQUENT EVENTS
Proposed Public Offering of Common Stock - The Company is
proposing to make a public offering of up to 100,000 shares of
its previously authorized but unissued common stock. The Company
plans to file a registration statement on Form SB-2 with the
United States Securities and Exchange Commission in accordance
with the Securities Act of 1933 as amended. An offering price of
$1.00 per share has arbitrarily been determined by the Company.
The offering will be managed by the Company without any
underwriter. The shares will be offered and sold by an officer
of the Company, who will receive no sales commissions or other
compensation in connection with the offering, except for
reimbursement of expenses actually incurred on behalf of the
Company in connection with the offering. The Company has
incurred stock offering costs totaling $5,000 as of September 30,
2000, but any such costs will be deferred and netted against the
proceeds of the proposed public stock offering.
8
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION & ANALYSIS OR PLAN OF OPERATIONS
New Paradigm was only recently incorporated on October 1, 1999, is a
small start up company that only recently commenced active business
operations, has not yet generated any revenues from operation and is
considered a development stage company. Upon inception, the founders of New
Paradigm contributed $5,000 cash to initially capitalize it in exchange for
900,000 shares of Common Stock. On January 1, 2000, New Paradigm commenced an
offering in reliance upon Rule 506 of Regulation D, promulgated by the U.S.
Securities & Exchange Commission under the Securities Act of 1933. 100,000
shares of common stock were offered and sold at $.35 per share. The offering
closed in March, 2000, and raised gross proceeds of $35,000. This increased
the total issued and outstanding common stock to 1,000,000 shares. In July,
2000, the Company filed a registration statement on Form SB-2 with the U.S.
Securities & Exchange Commission under the Securities Act of 1933, to register
the offering, on a "best efforts minimum/maximum" basis, of up to 100,000
shares of $.001 par value common stock, at a price of $1.00 per share. This
registration statement was declared effective on October 26, 2000. At that
time the Company became subject to the information requirements of the
Securities Exchange Act of 1934. Accordingly, the Company will file annual
and quarterly reports and other information with the Commission. No
securities have yet been sold pursuant to this offering.
PLAN OF OPERATIONS.
Management's plan of operation for the next twelve months is first to
raise funds from this offering. If the offering is successful, management
intends to use any funds generated from sale of shares in this offering to
provide initial working capital for the operation of the proposed business.
New Paradigm will use the proceeds of this offering to purchase computer and
recording equipment that will enable it to handle recording, editing and other
production on a limited basis in house; for the initial production run of
approximately 1000 to 3000 copies of the first series of compact discs; for
advertising and marketing; and to provide general working capital to meet
other operating expenses during the start up period of operations until New
Paradigm is able to generate revenues from operations to cover expenses. We
have not determined how long existing capital can satisfy any cash
requirements, but if the offering is successfully completed and raises at
least the minimum offering amount, we do not presently anticipate that we will
have to raise additional funds within the next twelve months. Instead, if less
than the entire offering amount is raised, New Paradigm will reduce the
initial production run of the first series of compact discs, reduce the
advertising and marketing budget, and reduce the amount of computer and
recording equipment purchased initially, which will limit the extent it can
handle recording, editing and other production on an in house basis.
New Paradigm was formed to produce and market compact discs, cassette
and video tapes, and books with a basic theme of self improvement. The
initial product will be meditation enhancing music. New Paradigm is dependent
upon the successful completion of this offering and receipt of the proceeds
therefrom, of which there is no assurance, for the ability to fully commence
its intended business operations. In the event the proposed business is
unsuccessful, there is no assurance New Paradigm could successfully become
involved in any other business venture. New Paradigm presently has no plans,
commitments or arrangements with respect to any other proposed business
venture.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(a) None.
(b) None.
(c) See Part I, Item 1 (financial statements) and Item 2 (management's
discussion) for financial information and a discussion regarding
use of proceeds.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
<PAGE>
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.
NEW PARADIGM PRODUCTIONS, INC.
Date: November 21, 2000 by: /s/ Jody St. Clair
Jody St. Clair, President & Director
