SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of
1934
Commission File No.: 000-29161
CAPTAINS MANAGEMENT CORPORATION, INC.
(Exact name of registrant as it appears in its charter)
NEVADA 88-0448017
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
468 North Camden Avenue
Beverly Hills, California 90210
(Address of Principal Executive Office) (Zip Code)
Code)
Registrant's telephone number, including area code: 310-858-5596
Securities registered pursuant to Section 12 (b) of the Act: None
Securities registered pursuant to Section 12 (b) of the Act:
Class A Common Stock $0.0027 Par Value
Indicate by check mark whether the registrant (1) has filed all reports to be
filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or 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 No
At the end of the quarter ending 3/31/2000 there were 5,000,000 issued and
outstanding shares of the registrants common stock.
There is no active market for the registrant's securities.
[1]
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
See attached exhibit
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION.
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and "forward-looking
statements" as that term is defined in Section 27A of the Securities Act of
1933 as amended (the "Securities Act"), and Section 21E of the Securities
Exchange Act of 1934 as amended (the "Exchange Act"). All statements that are
included in this Registration Statement, other than statements of historical
fact, are forward- looking statements. Although Management believes that the
expectations reflected in these forward-looking statements are reasonable, it
can give no assurance that such expectations will prove to have been correct.
Important factors that could cause actual results to differ materially from the
expectations are disclosed in this Statement, including, without limitation, in
conjunction with those forward-looking statements contained in this Statement.
Plan of Operation - General
The Company's plan is to seek, investigate, and if such investigation warrants,
acquire an interest in one or more business opportunities presented to it by
persons or firms desiring the perceived advantages of a publicly held
corporation. At this time, the Company has no plan, proposal, agreement,
understanding, or arrangement to acquire or merge with any specific business or
company, and the Company has not identified any specific business or company
for investigation and evaluation. No member of Management or any promoter of
the Company, or an affiliate of either, has had any material discussions with
any other company with respect to any acquisition of that company. The Company
will not restrict its search to any specific business, industry, or geographical
location, and may participate in business ventures of virtually any kind or
nature. Discussion of the proposed business under this caption and throughout
this Registration Statement is purposefully general and is not meant to restrict
the Company's virtually unlimited discretion to search for and enter into a
business combination.
The Company may seek a combination with a firm which only recently commenced
operations, or a developing company in need of additional funds to expand into
new products or markets or seeking to develop a new product or service, or an
established business which may be experiencing financial or operating
difficulties and needs additional capital which is perceived to be easier to
raise by a public company. In some instances, a business opportunity may involve
acquiring or merging with a corporation which does not need substantial
additional cash but which desires to establish a public trading market for its
common stock. The Company may purchase assets and establish wholly - owned
subsidiaries in various businesses or purchase existing businesses as
subsidiaries.
[2]
Selecting a business opportunity will be complex and extremely risky. Because
of general economic conditions, rapid technological advances being made in some
industries, and shortages of available capital, management believes that there
are numerous firms seeking the benefits of a publicly-traded corporation. Such
perceived benefits of a publicly traded corporation may include facilitating or
improving the terms on which additional equity financing may be sought,
providing liquidity for the principals of a business, creating a means for
providing incentive stock options or similar benefits to key employees,
providing liquidity ( subject to restrictions of applicable statues) for all
shareholders, and other items. Potentially available business opportunities may
occur in many different industries and at various stages of development, all of
which will make the task of comparative investigation and analysis of such
business opportunities extremely difficult and complex.
Management believes that the Company may be able to benefit from the use of
"leverage" to acquire a target company. Leveraging a transaction involves
acquiring a business while incurring significant indebtedness for a large
percentage of the purchase price of that business. Through leveraged
transactions, the Company would be required to use less of its available funds
to acquire a target company and, therefore, could commit those funds to the
operations of the business, to combinations with other target companies, or to
other activities. The borrowing involved in a leveraged transaction will
ordinarily be secured by the assets of the acquired business. If that business
is not able to generate sufficient revenues to make payments on the debt
incurred by the Company to acquire that business, the lender would be able to
exercise the remedies provided by law or by contract. These leveraging
techniques, while reducing the amount of funds that the Company must commit to
acquire a business, may correspondingly increase the risk of loss to the
Company. No assurance can be given as to the terms or availability of financing
for any acquisition by the Company. During periods when interest rates are
relatively high, the benefits of leveraging are not as great as during periods
of lower interest rates, because the investment in the business held on a
leveraged basis will only be profitable if it generates sufficient revenues to
cover the related debt and other costs of the financing. Lenders from which
the Company may obtain funds for purposes of a leveraged buy- out may impose
restrictions on the future borrowing, distribution, and operating policies of
the Company. It is not possible at this time to predict the restrictions, if
any, which lenders may impose, or the impact thereof on the Company.
The Company has insufficient capital with which to provide the owners of
businesses significant cash or other assets. Management believes the Company
will offer owners of businesses the opportunity to acquire a controlling
ownership interest in a public company at substantially less cost than is
required to conduct an initial public offering. The owners of the businesses
will, however, incur significant post-merger or acquisition registration costs
in the event they wish to register a portion of their shares for subsequent
sale. The Company will also incur significant legal and accounting costs in
connection with the acquisition of a business opportunity, including the costs
of preparing post - effective amendments, Forms 8-K, agreements, and related
reports and documents. Nevertheless, the officers and directors of the Company
have not conducted market research and are not aware of statistical data which
would support the perceived benefits of a merger or acquisition transaction for
the owners of a businesses. The Company does not intend to make any loans to
any prospective merger or acquisition candidates or to unaffiliated third
parties.
[3]
The Company will not restrict its search for any specific kind of firms, but
may acquire a venture which is in its preliminary or development stage, which
is already in operation, or in essentially any stage of its corporate life. It
is impossible to predict at this time the status of any business in which the
Company may become engaged, in that such business may need to seek additional
capital, may desire to have its shares publicly traded, or may seek other
perceived advantages which the Company may offer. However, the Company does not
intend to obtain funds in one or more private placements to finance the
operation of any acquired business opportunity until such time as the Company
has successfully consummated such a merger or acquisition. The Company also has
no plans to conduct any offerings under Regulation S.
Sources of Opportunities
The Company will seek a potential business opportunity from all known sources,
but will rely principally on personal contacts of its officers and directors as
well as indirect associations between them and other business and professional
people. It is not presently anticipated that the Company will engage
professional firms specializing in business acquisitions or reorganizations.
Management, while not especially experienced in matters relating to the new
business of the Company, will rely upon their own efforts and, to a much lesser
extent, the efforts of the Company's shareholders, in accomplishing the business
purposes of the Company. It is not anticipated that any outside consultants or
advisors, other than the Company's legal counsel and accountants, will be
utilized by the Company to effectuate its business purposes described herein.
However, if the Company does retain such an outside consultant or advisor, any
cash fee earned by such party will need to be paid by the prospective
merger/acquisition candidate, as the Company has no cash assets with which to
pay such obligation. There have been no discussions, understandings, contracts
or agreements with any outside consultants and none are anticipated in the
future. In the past, the Company's management has never used outside
consultants or advisors in connection with a merger or acquisition.
As is customary in the industry, the Company may pay a finder's fee for locating
an acquisition prospect. If any such fee is paid, it will be approved by the
Company's Board of Directors and will be in accordance with the industry
standards. Such fees are customarily between 1% and 5% of the size of the
transaction, based upon a sliding scale of the amount involved. Such fees are
typically in the range of 5% on a $1,000,000 transaction ratably down to 1% in
a $4,000,000 transaction. Management has adopted a policy that such a finder's
fee or real estate brokerage fee could, in certain circumstances, be paid to
any employee, officer, director or 5% shareholder of the Company, if such
person plays a material role in bringing a transaction to the Company.
The Company will not have sufficient funds to undertake any significant
development, marketing, and manufacturing of any products which may be acquired.
Accordingly, if it acquires the rights to a product, rather than entering into
a merger or acquisition, it most likely would need to seek debt or equity
financing or obtain funding from third parties, in exchange for which the
Company would probably be required to give up a substantial portion of its
interest in any acquired product. There is no assurance that the Company will
be able either to obtain additional financing or to interest third parties in
providing funding for the further development, marketing and manufacturing of
any products acquired.
[4]
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by or under the
supervision of the officers and directors of the Company ( see "Management" ).
Management intends to concentrate on identifying prospective business
opportunities which may be brought to its attention through present
associations with management. In analyzing prospective business opportunities,
management will consider, among other factors, such matters as;
1. the available technical, financial and managerial resources
2. working capital and other financial requirements
3. history of operation, if any
4. prospects for the future
5. present and expected competition
6. the quality and experience of management services which may be available and
the depth of that management
7. the potential for further research, development or exploration
8. specific risk factors not now foreseeable but which then may be anticipated
to impact the proposed activities of the Company
9. the potential for growth or expansion
10. the potential for profit
11. the perceived public recognition or acceptance of products, services or
trades
12. name identification
Management will meet personally with management and key personnel of the firm
sponsoring the business opportunity as part of their investigation. To the
extent possible, the Company intends to utilize written reports and personal
investigation to evaluate the above factors. The Company will not acquire or
merge with any company for which audited financial statements cannot be
obtained.Opportunities in which the Company participates will present certain
risks, many of which cannot be identified adequately prior to selecting a
specific opportunity. The Company's shareholders must, therefore, depend on
Management to identify and evaluate such risks. Promoters of some opportunities
may have been unable to develop a going concern or may present a business in
its development stage (in that it has not generated significant revenues from
its principal business activities prior to the Company's participation.) Even
after the Company's participation, there is a risk that the combined enterprise
may not become a going concern or advance beyond the development stage. Other
opportunities may involve new and untested products, processes, or market
strategies which may not succeed. Such risks will be assumed by the Company
and, therefore, its shareholders.
The investigation of specific business opportunities and the negotiation,
drafting, and execution of relevant agreements, disclosure documents, and other
instruments will require substantial management time and attention as well as
substantial costs for accountants, attorneys, and others. If a decision is made
not to participate in a specific business opportunity the costs incurred in the
related investigation would not be recoverable. Furthermore, even if an
agreement is reached for the participation in a specific business opportunity,
the failure to consummate that transaction may result in the loss by the
Company of the related costs incurred.
[5]
There is the additional risk that the Company will not find a suitable target.
Management does not believe the Company will generate revenue without finding
and completing a transaction with a suitable target company. If no such target
is found, therefore, no return on an investment in the Company will be
realized, and there will not, most likely, be a market for the Company's stock.
Acquisition of Opportunities
In implementing a structure for a particular business acquisition, the Company
may become a party to a merger, consolidation, reorganization, joint venture,
franchise, or licensing agreement with another corporation or entity. It may
also purchase stock or assets of an existing business. Once a transaction is
complete, it is possible that the present management and shareholders of the
Company will not be in control of the Company. In addition, a majority or all
of the Company's officers and directors may, as part of the terms of the
transaction, resign and be replaced by new officers and directors without a
vote of the Company's shareholders.
It is anticipated that securities issued in any such reorganization would be
issued in reliance on exemptions from registration under applicable Federal and
state securities laws. In some circumstances, however, as a negotiated element
of this transaction, the Company may agree to register such securities either
at the time the transaction is consummated, under certain conditions, or at
specified time thereafter. The issuance of substantial additional securities
and their potential sale into any trading market which may develop in the
Company's Common Stock may have a depressive effect on such market.
While the actual terms of a transaction to which the Company may be a party
cannot be predicted, it may be expected that the parties to the business
transaction will find it desirable to avoid the creation of a taxable event and
thereby structure the acquisition in a so called "tax free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code of 1986, as amended (the
"Code"). In order to obtain tax free treatment under the Code, it may be
necessary for the owners of the acquired business to own 80% or more of the
voting stock of the surviving entity. In such event, the shareholders of the
Company, including investors in this offering, would retain less than 20% of
the issued and outstanding shares of the surviving entity, which could result
in significant dilution in the equity of such shareholders.
As part of the Company's investigation, officers and directors of the Company
will meet personally with management and key personnel, may visit and inspect
material facilities, obtain independent analysis or verification of certain
information provided, check references of management and key personnel, and
take other reasonable investigative measures, to the extent of the Company's
limited financial resources and management expertise.
[6]
The manner in which the Company participates in an opportunity with a target
company will depend on the nature of the opportunity, the respective needs and
desires of the Company and other parties, the management of the opportunity,
and the relative negotiating strength of the Company and such other management.
With respect to any mergers or acquisitions, negotiations with target company
management will be expected to focus on the percentage of the Company which the
target company's shareholders would acquire in exchange for their shareholdings
in the target company. Depending upon, among other things, the target company's
assets and liabilities, the Company's shareholders will, in all likelihood,
hold a lesser percentage ownership interest in the Company following any merger
or acquisition. The percentage ownership may be subject to significant
reduction in the event the Company acquires a target company with substantial
assets. Any merger or acquisition effected by the Company can be expected to
have a significant dilutive effect on the percentage of shares held by the
Company's then shareholders, including purchasers in this offering.
Management has advanced, and will continue to advance, funds which shall be
used by the Company in identifying and pursuing agreements with target
companies. Management anticipates that these funds will be repaid from the
proceeds of any agreement with the target company, and that any such agreement
may, in fact, be contingent upon the repayment of those funds.
Competition
The Company is an insignificant participant among firms which engage in
business combinations with, or financing of, development - stage enterprises.
There are many established management and financial consulting companies and
venture capital firms which have significantly greater financial and personal
resources, technical expertise and experience than the Company. In view of the
Company's limited financial resources and management availability, the Company
will continue to be at significant competitive disadvantage vis - a - vis the
Company's competitors.
Year 2000 Compliance
The Company is aware of the issues associated with the programming code in
existing computer systems as the year 2000 approaches. The Company has assessed
these issues as they relate to the Company, and since the Company currently has
no operating business and does not use any computers, and since it has no
customers, suppliers or other constituents, it does not believe that there are
any material year 2000 issues to disclose in this Form 10-SB.
Regulation and Taxation
The Investment Company Act of 1940 defines an "investment company" as an issuer
which is or holds itself out as being engaged primarily in the business of
investing, reinvesting or trading securities. While the Company does not intend
to engage in such activities, the Company may obtain and hold a minority
interest in a number of development stage enterprises. The Company could be
expected to incur significant registration and compliance costs if required to
register under the Investment Company Act of 1940. Accordingly, management will
continue to review the Company's activities from time to time with a view
toward reducing the likelihood the Company could be classified as an
"investment company".The Company intends to structure a merger or acquisition
in such manner as to minimize Federal and state tax consequences to the Company
and to any target company.
[7]
Employees
The Company's only employees at the present time are its officers and
directors, who will devote as much time as the Board of Directors determine is
necessary to carry out the affairs of the Company. (See "Management").
The Company has had no operations during this quarter.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities
None
Item 3. Default 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 10-Q
(a) The following documents are filed as part of this report:
Financial Statements as of March 31, 2000 as prepared by Kurt D.
Saliger, C.P.A
Exhibits:
<TABLE>
<S> <C> <C>
3.1 Articles of Incorporation Incorporated by
reference The Company's Form 10 SB/A filed on
March 24th, 2000.
3.2 By-Laws Incorporated by reference The Company's Form
10-SB/A filed on March 24th, 2000.
[8]
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 thereunto duly authorized.
Captain's Management Corporation, Inc.
Dated: August , 2000
By: /S/
Paul Salas, President
[9]
CAPTAINS MANAGEMENT CORPORATION, INC.
FINANCIAL STATEMENTS
MARCH 31, 2000
CAPTAINS MANAGEMENT CORPORATION, INC.
CONTENTS
</TABLE>
<TABLE>
Page
<S> <C>
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
</TABLE>
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 March 31, 2000, and the
related statements of operations, changes in stockholders' equity and cash
flows for the three months in the period ended March 31, 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 March 31, 2000 and the results of their operations
and its cash flows for the three month period ended March 31, 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 8, 2000
<TABLE>
CAPTAINS MANAGEMENT CORPORATION, INC.
( A Develpment Stage Company)
BALANCE SHEET
<CAPTION>
March 31, 2000
ASSETS
<S> <C>
CURRENT ASSETS
Cash $0
Accounts Receivable $0
_________
TOTAL CURRENT ASSETS $0
PROPERTY AND EQUIPMENT, NET $0
OTHER ASSETS $0
_________
LIABILITIES AND STOCKHOLDERS' EQUITY
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
27,000 shares 2,700
Additional Paid In Capital $0
Deficit Accumulated During
Development Stage ($2,700)
__________
TOTAL STOCKHOLDERS' EQUITY $0
__________
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $0
----------
</TABLE>
See accompanying notes to financial statements.
-2-
<TABLE>
CAPTAINS MANAGEMENT CORPORATION, INC.
( A Development Stage Company )
STATEMENT OF OPERATIONS
<CAPTION>
For the August
period 08, 1996
ended (inception)
March 31, to March 31,
2000 2000
<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 $0 $0
---------- ---------
TOTAL OPERATING EXPENSES $0 $2,700
---------- ---------
INCOME (LOSS) FROM OPERATIONS $0 ($2,700)
OTHER INCOME (EXPENSES)
Gain on sale of assets $0 $0
Interest expense $0 $0
---------- ----------
INCOME (LOSS) BEFORE INCOME TAXES $0 ($2,700)
Income Taxes $0 $0
--------- ----------
NET PROFIT (LOSS) $0 ($2,700)
--------- ----------
NET PROFIT (LOSS)
PER SHARE $0.0000 (0.1000)
__________ __________
AVERAGE NUMBER OF SHARES
OF COMMON STOCK OUTSTANDING 27,000 27,000
</TABLE>
See accompanying notes to financial statements.
-3-
<TABLE>
CAPTAINS MANAGEMENT CORPORATION, INC.
( A Development Stage Company )
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
March 31, 2000
<CAPTION>
Common Stock (Deficit)
-------------- Accumulated
Number Additional During
of Paid In Development
Shares Amount Capital Stage
-------- --------- ----------- -----------
<S> <C> <C> <C> <C>
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)
Net (Loss), 03-31-00 $0
--------- ---------- --------- ---------
Balance March
31, 2000 27,000 $2,700 $0 ($2,700)
========== ========== ========= =========
</TABLE>
See accompanying notes to financial statements.
-4-
<TABLE>
CAPTAINS MANAGEMENT CORPORATION, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
<CAPTION>
Jan. 1
to August 08,
March 1996
31, 2000 (inception)
to June 30, 2000
<S> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net (Loss) $0 ($2,700)
Amortization and depreciation $0 $0
--------- ------------
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 March 31, 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
March 31, 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.
The Company has issued 27,000 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.
-7-
