SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 of 15(d) of the
Securities Exchange Act of 1934
April 10, 2000
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Date of Report (date of earliest event reported)
CAPTAINS MANAGEMENT CORP., INC.
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Exact name of Registrant as Specified in its Charter
Nevada 0-29161 88-0448017
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State or Other Jurisdiction Commission File IRS Employer Identification
of Incorporation Number Number
468 North Camden Drive Beverly Hills, CA 90210
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Address of Principal Executive Offices, Including Zip Code
(310) 858-5569
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Registrant's Telephone Number, Including Area Code
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
On April 10, 2000, CAPTAIN'S MANAGEMENT CORP., INC. (the "Company")
completed the acquisition of 100% of the outstanding common stock of RAIL,
Inc., a Nevada corporation ("RAIL"), in exchange for 1,000,000 shares of
Captain's Management's Common Stock (approximately 20.0% of the shares now
outstanding).
The stock issuances were made pursuant to an Agreement ("Agreement")
between Captain's Management and RAIL. The terms of the Agreement were the
result of negotiations between the management of Captain's Management and
RAIL. However, the Board of Directors did not obtain any independent
"fairness" opinion or other evaluation regarding the terms of the Agreement,
due to the cost of obtaining such opinion or evaluation.
The foregoing summary of the Agreement is qualified by reference to the
complete text of the Agreement, together with the schedules thereto, which is
filed as Exhibit 10 hereto, and is incorporated herein by this reference.
As a result of the transaction with RAIL and the issuance of the
1,000,000 shares of Captain's Management's Common Stock, following are those
persons known by Captain's Management to own 5% or more of Captain's
Management's Voting Stock:
Percent of Outstanding
Name and Address Voting Shares Voting Shares
---------------- ------------- -------------
Paul Salas 1,000,000 20%
101-01 101 St Avenue
Ozone Park, NY 11417
Edward Figueroa, Jr 1,000,000 20%
551 Ridgewood Avenue
Brooklyn, NY 11208
Natibe Latouf 1,000,000 20%
60-03 67th Avenue
Ridgewood, NY 11385
_________________
Effective on the closing of the acquisition, Captain's Management's
officers and directors were as follows:
Paul Salas President, Treasurer and Director
Edward Figueroa, Jr. Vice President and Director
Natibe Latouf Secretary and Director
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
As described in Item 1 of this Report, on April 10, 2000, Captain's
Management acquired all of the issued and outstanding common stock of RAIL,
Inc. ("RAIL") in exchange for shares of Captain's Management's Common Stock.
The acquisition of RAIL (accounting acquirer) by Captain's Management
(nonoperating shell) is considered in substance to be a capital transaction
and is accounted for in a manner similar to a reverse acquisition.
RAIL is currently negotiating additional strategic alliances with other
companies involved in Internet production, marketing and technology. The
Internet has allowed companies a direct avenue to the consumer that artists
and music companies have been unable to achieve in the past. Companies
utilize technologies which permit the consumer to download and play music,
close to CD quality, directly from their website. RAIL plans to take this
approach to the next level by allowing consumers to view or download live
events including concerts, pay per view programs and live sporting events from
anywhere in the world.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.
Captain's Management Corp., Inc., and Rail, Inc., combined financials
June 30th, 2000.
(c) EXHIBITS.
Exhibits:
3.1 Articles of Incorporation, Incorporated by reference in Company's
Form 10SB12/A filing on 3/24/00.
3.2 By Laws, Incorporated by reference in Company's Form 10SB12G/A
filing on 3/24/00.
10-1 Agreement between Captain's Management Corp., Inc., and RAIL, Inc.
Incorporated by reference in Company's 8K, filed on April 10, 2000.
SIGNATURES
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, hereunto duly authorized.
RAIL, INC.
Dated: August 28, 2000
By:___________________________________
Jimmy H. Jin, President
CAPTAINS MANAGEMENT CORPORATION, INC.
FINANCIAL STATEMENTS
June 30, 2000
CAPTAINS MANAGEMENT CORPORATION, INC.
CONTENTS
Page
Independent Auditor's Report 1
Financial Statements
Balance Sheet 2
Statement of Operations 3
Statement of Changes in Stockholders' Equity 4
Statement of Cash Flows 5
Notes to Financial Statements 6-7
KURT D. SALIGER
Certified Public Accountant
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Captain's Management Corporation, Inc.
Las Vegas, Nevada
I have audited the accompanying balance sheets of Captain's Management
Corporation, Inc. (a development stage company) as of June 30, 2000, and the
related statements of operations, changes in stockholders' equity and cash
flows for the six months in the period ended June 30, 2000. These
financial statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial statements based
on my audits.
I conducted my audits in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. I believe that my audits provides a reasonable basis
for my opinion.
In my opinion, the financial statements referred to above present fairly,
in all, material respects, the financial position of Captain's Management
Corporation, Inc., as of June 30, 2000 and the results of their operations
and its cash flows for the six month period ended June 30, 2000, in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 4 to the
financial statements, the Company has had no operations and has no
established source of revenue. This raises substantial doubt about its
ability to continue as a going concern. Management's planin regard to these
matters are also described in Note 4. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Kurt D. Saliger C.P.A.
August 23, 2000
CAPTAINS MANAGEMENT CORPORATION, INC.
( A Develpment Stage Company)
BALANCE SHEET
<TABLE>
June 30, 2000
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $0
Accounts Receivable $0
_________
TOTAL CURRENT ASSETS $0
PROPERTY AND EQUIPMENT, NET $77,315
OTHER ASSETS
Licensing Fees $36,000
_________
TOTAL ASSETS $113,315
</TABLE>
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<C> <C>
CURRENT LIABILITIES
Accounts Payable $0
Accrued Liabilities $0
Current Portion, Long Term Debt $0
_________
TOTAL CURRENT LIAILITIES $0
LONG-TERM DEBT $0
STOCKHOLDER'S EQUITY $0
Common Stock, no par value
authorized 25,000,000 shares;
issued and outstanding
1,027,000 shares $119,376
Additional Paid In Capital $0
Deficit Accumulated During
Development Stage ($6,061)
__________
TOTAL STOCKHOLDERS' EQUITY $113,315
__________
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $113,315
----------
See accompanying notes to financial statements.
</TABLE>
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CAPTAINS MANAGEMENT CORPORATION, INC.
( A Development Stage Company )
STATEMENT OF OPERATIONS
For the August
period 08, 1996
ended (inception)
June 30, to June 30,
2000 2000
<TABLE>
<S> <C> <C>
REVENUES $0 $0
COSTS OF REVENUES $0 $0
---------- ----------
GROSS PROFIT $0 $0
OPERATING EXPENSES
Selling, general and
administrative $0 $2,700
Amortization and depreciation $3,361 $3,361
---------- ---------
TOTAL OPERATING EXPENSES $3,361 $6,061
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INCOME (LOSS) FROM OPERATIONS ($3,361) ($6,061)
OTHER INCOME (EXPENSES)
Gain on sale of assets $0 $0
Interest expense $0 $0
---------- ----------
INCOME (LOSS) BEFORE INCOME TAXES ($3,361) ($6,061)
Income Taxes $0 $0
--------- ----------
NET PROFIT (LOSS) ($3,361) ($6,061)
--------- ----------
NET PROFIT (LOSS)
PER SHARE ($0.0033) (0.0059)
__________ __________
AVERAGE NUMBER OF SHARES
OF COMMON STOCK OUTSTANDING 1,027,000 1,0 27,000
</TABLE>
See accompanying notes to financial statements.
-3-
CAPTAINS MANAGEMENT CORPORATION, INC.
( A Development Stage Company )
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
June 30, 2000
Common Stock (Deficit)
-------------- Accumulated
Number Additional During
of Paid In Development
Shares Amount Capital Stage
-------- --------- ----------- -----------
<TABLE>
<S> <S> <S> <S> <S>
Issued for cash
08-08-96 27,000 $2,700 $0
Net (Loss), 08-08-96
(inception) to 12-31-96 ($2,700)
-------- ---------- ----------- -----------
Balance, Dec. 31, 96 27,000 $2,700 $0 ($2,700)
Net (Loss), 12-31-97 $0
-------- ---------- ----------- ----------
Balance, Dec. 31, 97 27,000 $2,700 $0 ($2,700)
Net (Loss), 12-31-98 $0
-------- ---------- ---------- ---------
Balance, Dec 31, 1998 27,000 $2,700 $0 ($2,700)
Net (Loss), 12-31-99 $0
-------- ---------- --------- ---------
Balance, Dec. 31, 1999 27,000 $2,700 $0 ($2,700)
Issued for assets
Rail, Inc.
04-10-00 1,000,000 $116,676 $0
Net (Loss), 06-30-00 ($3,361)
--------- ---------- --------- ---------
Balance June
30, 2000 1,027,000 $119,376 $0 ($6,061)
========== ========== ========= =========
</TABLE>
See accompanying notes to financial statements.
-4-
CAPTAINS MANAGEMENT CORPORATION, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
<TABLE>
Jan. 1 August 08,
to 1996
June (inception)
30, 2000 to June 30, 2000
<S> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net (Loss) ($3,316) ($6,016)
Amortization and depreciation $3,316 $3,316
--------- ------------
CASH FLOWS FROM
OPERATING ACTIVITIES $0 ($2,700)
Issue common stock $0 $2,700
Treasury stock $0 $0
--------- ------------
Net increase
(decrease) in cash $0 $0
Cash, Beginning
of Period $0 $0
_________ ___________
Cash, End
of Period $0 $0
========= ===========
</TABLE>
See accompanying notes to financial statements.
-5-
CAPTAINS MANAGEMENT CORPORATION, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized August 08, 1996 under the laws of the State of
Nevada, under the name Captains Management Corporation, Inc. The Company
currently has no operations and, in accordance with SFAS #7, is considered a
development stage company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method of
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,
disclosure of contingent assets and liabilities, and the reported amounts of
revenue and expenses during the reporting period. Actual results could differ
from those estimates.
For the statements of cash flows, all highly liquid investments with a
maturity of three months or less are considered to be cash equivalents. There
were no cash equivalents as of June 30, 2000.
Fixed assets
The Company does not maintain or control any fixed assets.
Income taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS
# 109) "Accounting for Income Taxes." A deferred tax asset or liability is
recorded for all temporary differences between financial and tax reporting.
Deferred tax expense (benefit) results from the net change during the year
deferred tax assets and liabilities.
-6-
CAPTAINS MANAGEMENT CORPORATION, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Loss per Share
Net loss per share is provided in accordance with Statement of Financial
Accounting Standards No. 128 (SFAS #128) " Earnings Per Share." Basic loss
per share is computed by dividing losses available to common stockholders by
the weighted average number of common shares outstanding during the period.
Diluted loss per share reflects per share amounts that would resulted in
dilutive common stock equivalents have been converted to common stock. As of
June 30, 2000 the Company had no dilutive common stock equivalents such as
stock options.
NOTE 3 - STOCKHOLDERS' EQUITY
The authorized common stock of Captains Management Corporation, Inc.
consists of 25,000,000 shares with no par value per share.
On April 10,2000 the Company acquired all of the issued and outstanding common
stock of Rail, Inc. in exchange for 1,000,000 shares of the Company's stock.
The acquisition was accounted for using the purchase method of accounting.
The Company has issued 1,027,000 shares of its common stock.
The Company has no preferred stock.
NOTE 4 - GOING CONCERN
The Company's financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. However, the Company has no current source of
revenue. Without realization of additional capital, it would be unlikely for
the Company to continue as a going concern.
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