UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-QSB
(Mark one)
XX QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 0-31297
Shallbetter Industries, Inc.
(Exact name of small business issuer as specified in its charter)
Minnesota 41-1961936
(State of incorporation) (IRS Employer ID Number)
11900 Wayzata Blvd., Suite 100, Hopkins MN 55305
(Address of principal executive offices)
(612) 541-1155
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the past
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. YES NO X
State the number of shares outstanding of each of the issuer's
classes of common equity as of the latest practicable date:
October 5, 2000: 1,220,000
Transitional Small Business Disclosure Format (check one): YES NO X
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Shallbetter Industries, Inc.
Form 10-QSB for the Quarter ended September 30, 2000
Table of Contents
Page
Part I - Financial Information
Item 1 Financial Statements 3
Item 2 Management's Discussion and Analysis or Plan of Operation 9
Part II - Other Information
Item 1 Legal Proceedings 10
Item 2 Changes in Securities 10
Item 3 Defaults Upon Senior Securities 10
Item 4 Submission of Matters to a Vote of Security Holders 10
Item 5 Other Information 10
Item 6 Exhibits and Reports on Form 8-K 10
Signatures 10
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Part 1 - Item 1 - Financial Statements
Accountant's Review Report
Board of Directors and Shareholders
Shallbetter Industries, Inc.
We have reviewed the accompanying balance sheets of Shallbetter
Industries, Inc. (a Minnesota corporation) as of September 30,
2000 and 1999 and the accompanying statements of operations and
comprehensive income for the nine and three months ended
September 30, 2000 and 1999 and statements of cash flows for the
nine months ended September 30, 2000 and 1999. These financial
statements are prepared in accordance with the instructions for
Form 10-QSB, as issued by the U. S. Securities and Exchange
Commission, and are the sole 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 on an opinion
regarding the financial statements 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.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed
in Note A to the financial statements, the Company has no viable
operations or significant assets and is dependent upon
significant shareholders to provide sufficient working capital to
maintain the integrity of the corporate entity. These
circumstances create substantial doubt about the Company's
ability to continue as a going concern and are discussed in Note
A. The financial statements do not contain any adjustments that
might result from the outcome of these uncertainties.
/s/ S. W. HATFIELD, CPA
Dallas, Texas
October 5, 2000
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Shallbetter Industries, Inc.
Balance Sheets
September 30, 2000 and 1999
(Unaudited)
September 30, September 30,
2000 1999
ASSETS
Current Assets
Cash on hand and in bank $ 947 $ -
Total Assets $ 947 $ -
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities $ - $ -
Commitments and Contingencies
Shareholders' Equity
Preferred stock - $0.01 par value.
5,000,000 shares authorized;
none issued and outstanding - -
Common stock - $0.01 par value.
45,000,000 shares authorized.
1,220,000 and 220,000
shares issued and outstanding 12,200 2,200
Additional paid-in capital 17,529 17,529
Accumulated deficit (27,954) (19,729)
1,775 -
Stock subscription receivable (828) -
Total Shareholders' Equity 947 -
Total Liabilities and Shareholders' Equity $ 947 $ -
The financial information presented herein has been prepared by management
without audit by independent certified public accountants. See Accountant's
Review Report.
The accompanying notes are an integral part of these financial statements.
4
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Shallbetter Industries, Inc.
Statements of Operations and Comprehensive Income
Nine and Three months ended September 30, 2000 and 1999
(Unaudited)
Nine months Nine months Three months Three months
ended ended ended ended
September 30, September 30, September 30, September 30,
2000 1999 2000 1999
Revenues $ - $ - $ - $ -
Expenses
General and administrative 8,225 - 5,902 -
Total expenses 8,225 - 5,902 -
Loss before Income Taxes (8,225) - (5,902) -
Provision for Income Taxes - - - -
Net Loss (8,225) - (5,902) -
Other comprehensive income - - - -
Comprehensive Income $ (8,225) $ - $ (5,902) $ -
Loss per weighted-average share of
common stock outstanding,
computed on Net Loss - basic
and fully diluted $ (0.01) nil $ (0.01) nil
Weighted-average number of shares
of common stock outstanding 1,220,000 220,000 1,220,000 220,000
The financial information presented herein has been prepared by management
without audit by independent certified public accountants. See Accountant's
Review Report.
The accompanying notes are an integral part of these financial statements
5
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Shallbetter Industries, Inc.
Statements of Cash Flows
Nine months ended September 30, 2000 and 1999
(Unaudited)
Six months Six months
ended ended
September 30, September 30,
2000 1999
Cash Flows from Operating Activities
Net Loss $ (8,225) $ -
Adjustments to reconcile net income to net cash
provided by operating activities
Decrease in accounts payable - -
Net cash provided by (used in) operating activities (8,225) -
Cash Flows from Investing Activities - -
Cash Flows from Financing Activities
Cash received common stock subscription 9,172 -
Advance from shareholder - -
Net cash provided by financing activities 9,172 -
Increase (Decrease) in Cash and Cash Equivalents 947 -
Cash and cash equivalents at beginning of period - -
Cash and cash equivalents at end of period $ 947 $ -
Supplemental Disclosures of Interest and Income Taxes Paid
Interest paid during the period $ - $ -
Income taxes paid (refunded) $ - $ -
The financial information presented herein has been prepared by management
without audit by independent certified public accountants. See Accountant's
Review Report.
The accompanying notes are an integral part of these financial statements
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Shallbetter Industries, Inc.
Notes to Financial Statements
NOTE A - Organization and Description of Business
Shallbetter Industries, Inc. (Company) was initially incorporated
on September 8, 1968 under the laws of the State of Minnesota.
From inception through 1982, the Company was involved in the
design, production and sale of custom electric power distribution
equipment; including switchgears, panelboards, busducts, high and
low voltage main entrance cabinets and substations. The Company
also designed and marketed electrical apparatus to the mobile
home industry.
On December 30, 1999, at a Special Meeting of the Shareholders,
the following items were approved: 1) Restated Articles of
Incorporation were filed with the State of Minnesota to increase
the authorized number of common shares which may be issued from
250,000 at $0.10 par value to 45,000,000 shares at $0.01 par
value and to authorize the issuance of up to 5,000,000 shares of
$0.01 par value preferred stock and 2) to change the Company's
year-end from August 31 to December 31. The effects of these
changes are reflected in the accompanying financial statements as
of the first day of the first period presented.
During 1982, the Company ceased all operations, liquidated all
assets and settled all outstanding liabilities through a Chapter
7 action in the U. S. Bankruptcy Court.. Subsequent to the
settlement and dismissal of the bankruptcy action , the Company
has not conducted any business operations or maintained any
assets. The current business purpose of the Company is to seek
out and obtain a merger, acquisition or outright sale transaction
whereby the Company's shareholders will benefit. The Company is
not currently engaged in any negotiations and continues to seek
an appropriate merger or acquisition candidate.
The Company is fully dependent upon funding under a Stock
Subscription Agreement with a member of its current management
and/or significant shareholders to provide sufficient working
capital to preserve the integrity of the corporate entity. It is
the intent of management and significant shareholders fulfill the
obligations under the Stock Subscription Agreement to provide the
necessary working capital necessary to support and preserve the
integrity of the corporate entity.
During interim periods, the Company follows the accounting
policies set forth in its annual audited financial statements
filed with the U. S. Securities and Exchange Commission on Form
10-SB on August 9, 2000. The information presented within these
interim financial statements may not include all disclosures
required by generally accepted accounting principles and the
users of financial information provided for interim periods
should refer to the annual financial information and footnotes
when reviewing the interim financial results presented herein.
In the opinion of management, the accompanying interim financial
statements, prepared in accordance with the U. S. Securities and
Exchange Commission's instructions for Form 10-QSB, are unaudited
and contain all material adjustments, consisting only of normal
recurring adjustments necessary to present fairly the financial
condition, results of operations and cash flows of the Company
for the respective interim periods presented. The current period
results of operations are not necessarily indicative of results
which ultimately will be reported for the full fiscal year ending
December 31, 2000.
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 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.
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Shallbetter Industries, Inc.
Notes to Financial Statements - Continued
NOTE B - Summary of Significant Accounting Policies
1. Cash and cash equivalents
The Company considers all cash on hand and in banks,
including accounts in book overdraft positions, certificates
of deposit and other highly-liquid investments with
maturities of three months or less, when purchased, to be
cash and cash equivalents.
2. Income taxes
With a 1999 effective change of control of the Company, all
net operating loss carryforwards incurred prior to that time
were negated in accordance with Section 382 of the Internal
Revenue Code.
At September 30, 2000 and 1999, the deferred tax asset and
deferred tax liability accounts, as recorded when material,
are entirely the result of temporary differences. Temporary
differences represent differences in the recognition of
assets and liabilities for tax and financial reporting
purposes, primarily accumulated depreciation and
amortization. Any deferred tax asset existing at these dates
was fully reserved due to the unpredictability of their
ultimate realization.
3. Earnings (Loss) per share
Basic earnings (loss) per share is computed by dividing the
net income (loss) by the weighted-average number of shares of
common stock and common stock equivalents (primarily
outstanding options and warrants). Common stock equivalents
represent the dilutive effect of the assumed exercise of the
outstanding stock options and warrants, using the treasury
stock method. The calculation of fully diluted earnings
(loss) per share assumes the dilutive effect of the exercise
of outstanding options and warrants at either the beginning
of the respective period presented or the date of issuance,
whichever is later. As of September 30, 2000 and 1999, the
Company has no warrants and/or options issued and
outstanding.
NOTE C - Common Stock Transactions
On December 30, 1999, the Company filed Amended and Restated
Articles of Incorporation with the State of Minnesota. The
effect of these Articles was to increase the authorized number of
common shares which may be issued from 250,000 at $0.10 par value
to 45,000,000 shares at $0.01 par value. Additionally, the
Restated Articles authorized the issuance of up to 5,000,000
shares of $0.01 par value preferred stock. The effect of these
changes is reflected in the accompanying financial statements as
of the first day of the first period presented.
On December 30, 1999, the Company entered into a $10,000 Stock
Subscription Agreement with an individual, who became the
Company's President and Sole Director on December 9, 1999, for
the acquisition of 1,000,000 shares of restricted, unregistered
$0.01 par value common stock. The Stock Subscription Agreement
is scheduled to be paid in the following installments: February
1, 2000 - $3,000; April 1, 2000 - $3,500; June 1, 2000 - $3,500.
As of September 30, 2000, approximately $9,172 of the scheduled
amounts have been received.
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Part I - Item 2
Management's Discussion and Analysis of Financial Condition and
Results of Operations
Caution Regarding Forward-Looking Information
This quarterly report contains certain forward-looking statements
and information relating to the Company that are based on the
beliefs of the Company or management as well as assumptions made
by and information currently available to the Company or
management. When used in this document, the words "anticipate,"
"believe," "estimate," "expect" and "intend" and similar
expressions, as they relate to the Company or its management, are
intended to identify forward-looking statements. Such statements
reflect the current view of the Company regarding future events
and are subject to certain risks, uncertainties and assumptions,
including the risks and uncertainties noted. Should one or more
of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially
from those described herein as anticipated, believed, estimated,
expected or intended. In each instance, forward-looking
information should be considered in light of the accompanying
meaningful cautionary statements herein.
Results of Operations, Liquidity and Capital Resources
The Company had no revenue for the nine month periods ended
September 30, 2000 and 1999, respectively.
General and administrative expenses for the nine and three months
ended September 30, 2000 were approximately $8,225 and $5,902,
respectively. The Company had no expenses during the
corresponding periods in 1999. These expenses consisted
primarily of legal and accounting expenses associated with
reviving the Company.
The Company realized a net loss of $8,225 for the first nine
months of 2000, and no net income or loss for the corresponding
period in 1999.
The Company does not expect to generate any meaningful revenue or
incur operating expenses unless and until it acquires an interest
in an operating company.
At September 30, 2000, the Company had available cash and working
capital of $947 and a retained deficit of $27,954. The available
cash is the result of the sale to Craig Laughlin of 1,000,000
shares of the Company's common stock at $0.01 per share, or a
total of $10,000. The shares were purchased through a promissory
note of which $9,172 was paid through September 30, 2000.
Management believes the Company has sufficient funds to meet its
anticipated needs through 2001.
The Company's need for capital may change dramatically if it
acquires an interest in a business opportunity during the next 12
months. The Company's current operating plan is to (i) handle
the administrative and reporting requirements of a public
company; and (ii) search for potential businesses, products,
technologies and companies for acquisition. At present, the
Company has no understandings, commitments or agreements with
respect to the acquisition of any business, product, technology
or company and there can be no assurance that the Company will
identify any such business, product, technology or company
suitable for acquisition in the future. Further, there can be no
assurance that the Company would be successful in consummating
any acquisition on favorable terms or that it will be able to
profitably manage the business, product, technology or company it
acquires.
Part II - Other Information
Item 1 - Legal Proceedings
None
Item 2 - Changes in Securities
None
Item 3 - Defaults on Senior Securities
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None
Item 4 - Submission of Matters to a Vote of Security Holders
The Company has held no regularly scheduled, called or
special meetings of shareholders during the reporting period.
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
Exhibit 27 - Financial Data Schedule
Reports on Form 8-K - None
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.
Shallbetter Industries, Inc.
October 5, 2000 /s/ Craig Laughlin
President and Director
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