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 ending June 30, 2000
Commission File No. 0000-29155
Peppercorn Industrial Corporation
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A Nevada corporation
88-0350345
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(I.R.S. Employer Identification Number)
2102 N. Donner Ave., Tucson, Arizona 85749
Registrant's telephone number, including area code:
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(520) 577-1516
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 reports), and (2) has been subject to such filing requirements for the past
90 days. [X]Yes [ ] No
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Class Outstanding as of July 31, 2000
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$.001 Par Value Common Stock 1,000,000 SHARES
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PART I
This Report may contain certain "forward-looking" statements as such term is
defined in the Private Securities Litigation Reform Act of 1995 or by the
Securities and Exchange Commission in its rules, regulations and/or releases,
which represent our expectations or beliefs, including but not limited to,
statements concerning our operations, economic performance, financial condition,
growth and acquisition strategies, investments, and future operational plans.
For this purpose, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the generality of the foregoing, words such as "may," "will," "expect,"
"believe," "anticipate," "intend," "could," "estimate," "might," or "continue"
or the negative or other variations thereof or comparable terminology are
intended to identify forward-looking statements. These statements by their
nature involve substantial risks and uncertainties, certain of which are beyond
our control, and actual results may differ materially depending on a variety of
important facts.
ITEM 1. FINANCIAL STATEMENTS
As used herein, the term "Company" refers to Peppercorn Industrial
Corporation, a Nevada corporation, and its subsidiaries and predecessors unless
otherwise indicated. Reviewed, interim financial statements are presented
including a balance sheet for the Company as of the quarter ended June 30, 2000
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.
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INDEPENDENT ACCOUNTANT'S REPORT
Peppercorn Industrial Corporation
(A Development Stage Company)
We have reviewed the accompanying balance sheets of Peppercorn
Industrial Corporation (a development stage company) as of June 30, 2000 and
December 31, 1999, and the related statements of operations for the three and
six months, and cash flows for the three month periods ended June 30, 2000 and
1999. 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 statement 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 for them to be in
conformity with generally accepted accounting principles.
Respectfully submitted
/s/ Robison, Hill & Co.
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Certified Public Accountants
Salt Lake City, Utah
July 21, 2000
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PEPPERCORN INDUSTRIAL CORPORATION
(A Development Stage Company)
BALANCE SHEETS
June 30 December 31
2000 1999
Assets: $ - $ -
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable &
Accrued Expenses $ 100 $ -
Total Liabilities 100 -
Shareholders' Equity:
Common Stock, Par Value $.001
Authorized 100,000,000 shares
Issued 1,000,000 shares at
June 30, 2000
and December 31, 1999 1,000 1,000
Paid-In Capital 1,315 335
Retained Deficit (1,200) (1,200)
Deficit Accumulated During the
Development State (1,215) (135)
Total Stockholders' Equity (100) $ -
Total Liabilities and
Shareholders' Equity $ - $ -
See accompanying notes and accountants' report.
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PEPPERCORN INDUSTRIAL CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS
For the three months ended
ended June 30,
2000 1999
Revenues $ - $ -
Expenses 100 -
Net Loss $(100) $ -
Basic & Diluted
loss per share $ - $ -
Cumulative
since
For the six months ended inception of
ended June 30, development
2000 1999 stage
Revenues $ - $ - $ -
Expenses 1,080 135 1,215
Net Loss $(1,080) $ (135) $(1,215)
Basic & Diluted
loss per share $ - $ -
See accompanying notes and accountants' report.
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PEPPERCORN INDUSTRIAL CORPORATION
(A Development Stage Company)
STATEMENT OF CASH FLOWS
Cumulative
since July 12,
1999
For the six months ended inception of
ended June 30, development
2000 1999 stage
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net Loss $(1,080) $(135) $(1,215)
Increase (Decrease) in
Accounts Payable 100 135 (100)
Net Cash Used in
Operating activities (980) - (1,315)
CASH FLOWS FROM
INVESTING ACTIVITIES:
Net Cash provided by
Investing activities - - -
CASH FLOWS FROM
FINANCING ACTIVITIES:
Capital contributed
By shareholder 980 - 1,315
Net Cash provided by
Financing activities 980 - 1,315
Net (Decrease) in
Cash and Cash Equivalents - - -
Cash and Cash Equivalents
At Beginning of Period - - -
Cash and Cash Equivalents
At End of Period $ - $ - $ -
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest $ - $ - $ -
Franchise and income taxes $ - $ - $285
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AN
FINANCING ACTIVIITES: None
See accompanying notes and accountants' report.
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PEPPERCORN INDUSTRIAL CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2000
NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of accounting policies for Peppercorn Industrial Corporation
is presented to assist in understanding the Company's financial statements. The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.
The unaudited financial statements as of June 30, 2000 and for the six
months then ended reflect, in the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to fairly state the
financial position and results of operations for the six months. Operating
results for interim periods are not necessarily indicative of the results which
can be expected for full years.
Organization and Basis of Presentation
The Company was incorporated under the laws of the State of Nevada on
December 18, 1995. The Company ceased all operating activities during the period
from December 18, 1995 to October 20, 1999 and was considered dormant. Since
October 20, 1999, the Company is in the development stage, and has not commenced
planned principal operations.
Nature of Business
The company has no products or services as of June 30, 2000. The Company
was organized as a vehicle to seek merger or acquisition candidates. The Company
intends to acquire interests in various business opportunities, which in the
opinion of management will provide a profit to the Company
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.
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Pervasiveness of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles required 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.
Loss per Share
The reconciliations of the numerators and denominators of the basic loss
per share computations are as follows:
Per-Share
Income Shares Amount
------ ------ ------
(Numerator) (Denominator)
For the three months ended June 30, 2000:
Basic Loss per Share
Loss to common shareholders
$ (100) 1,000,000 $ -
For the six months ended June 30, 2000:
Basic Loss per Share
Loss to common shareholders
$(1,080) 1,000,000 $ -
For the three months ended June 30, 1999:
Basic Loss per Share
Loss to common shareholders
$ - 1,000,000 $ -
For the six months ended June 30, 1999:
Basic Loss per Share
Loss to common shareholders
$ (135) 1,000,000 $ -
The effect of outstanding common stock equivalents would be anti-dilutive
for June 30, 2000 and 1999 and are thus not considered.
Reclassification
Certain reclassifications have been made in the 2000 and 1999 financial
statements to conform with the June 30, 2000 presentation.
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NOTE 2 - INCOME TAXES
As of June 30, 2000, the Company had a net operating loss carryforward for
income tax reporting purposes of approximately $1,000 that may be offset against
future taxable income through 2011. Current tax laws limit the amount of loss
available to be offset against future income when a substantial change in
ownership occurs. Therefore, the amount available to offset future taxable
income will be limited. No tax benefit has been reported in the financial
statements, because the Company believes there is a 50% or greater chance the
carryforwards will expire unused. Accordingly, the potential tax benefits of the
loss carryforwards are offset by a valuation allowance of the same amount.
NOTE 3 - DEVELOPMENT STAGE COMPANY
The Company has not begun principal operations and as is common with a
development stage company, the Company has had recurring losses during its
development stage.
NOTE 4 - COMMITMENTS
As of June 30, 2000 all activities of the Company have been conducted by
corporate officers from either their homes or business offices. Currently, there
are no outstanding debts owed by the Company for the use of these facilities and
there are no commitments for future use of the facilitates.
NOTE 5 - STOCK SPLIT
On October 20, 1999 the Board of Directors authorized 1,000 to 1 stock
split, changes the authorized number of shares to 100,000,000 shares and the par
value to $.001 for the Company's common stock. As a result of the split, 999,000
shares were issued. All references in the accompanying financial statements to
the number of common stock and per-share amounts for 1999 and 1998 have been
restated to reflect the stock split.
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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 Peppercorn Industrial Corporation, a
Nevada corporation and its predecessors, unless the context indicates otherwise.
The Company is currently a shell company whose purpose is to acquire operations
through an acquisition or merger or to begin its own start-up business.
RESULTS OF OPERATIONS
The Company had no sales or sales revenues for the period ended June 30, 2000 or
1999 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 period ended June 30, 2000 or
1999 because it is a shell company that has not had any business operations for
the past three years. The Company had general and administrative expenses for
the period ended June 30, 2000 in the amount of $100.
The Company recorded net income loss of $100 for the three months ended June 30,
2000 compared to $0 loss for the comparable period in 1999.
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CAPITAL RESOURCES AND LIQUIDITY
At June 30, 2000, the Company had total current assets of $0 and total assets of
$0 as compared to $0 current assets and $0 total assets at December 31, 1999.
The Company had a net working capital deficit of $100 at June 30, 2000 with a
net working capital deficit of $135 at December 31, 1999.
Net stockholders' deficit in the Company was $100 as of June 30, 2000 and $0 at
December 31, 1999.
PART II-OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None/Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
None/Not Applicable.
ITEM 5. OTHER INFORMATION
None.
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.
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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 14th day of August, 2000.
Peppercorn Industrial Corporation
/s/ Michael K. Graye
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Michael K. Graye
August 14, 2000
President and Director
EXHIBIT INDEX
Exhibit No. Page No. Description
27 12 Financial Data Schedule
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