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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 10-K
(Mark One)
X Annual Report Pursuant to Section 13 or 15(d) of the
_____ Securities Exchange Act of 1934 [Fee Required]
For the fiscal year ended December 31, 1995
or
_____ Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 [No Fee Required]
For the Transition Period from ________ to ________
Commission file number 2-70345-NY
BUFFS-N-PUFFS LTD
_____________________________________________________
(Exact name of registrant as specified in its charter)
Former name of registrant - PUBCOA, INC.
NEVADA 88-0182534
________________________________________ ________________________
(State or other jurisdiction of (IRS Employer ID Number)
incorporation of organization.)
6500 South State Street, Murray, Utah 84107
________________________________________ ________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (801) 268-9280
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
State the aggregate market value of the voting stock held by non-affiliates
of the registrant. The aggregate market value shall be computed by reference to
the price at which the stock was sold, or the average bid and asked prices of
such stock, as of a specified date within 60 days prior to the date of the
filing.
2,511,375 shares at $0.3125 per share = $615,287 as of March 6, 1996
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
6,004,900 shares common stock par value $0.0001, excluding Treasury Shares
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(b) 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.
YES XX NO
____ ____
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PART I
ITEM 1. BUSINESS
Buffs-N-Puffs Ltd., formerly known as Pubcoa, Inc., (the "Company") was
incorporated under the laws of the State of Nevada on November 14, 1980. It has
engaged during the past thirteen (14) years in various business opportunities.
In 1990, the Company entered the carwash business. On March 22nd, 1990,
the Company's carwash operations started at 6500 South State, Murray, Utah. The
facilities have eight gas pumps and two tunnels. The first of these tunnels
houses carwash equipment which the Company believes is the best equipment
available in terms of cleaning the vehicles, reliability, and durability. In
this tunnel the Company offers a full range of services for automotive cleaning,
including the cleaning of the undercarriage and tires. The Company operations
are known as a full service carwash because of the many services it offers and
because the customer performs no service. The carwash operations is not a self
service nor a single station roll over wash. The second tunnel houses
automotive interior cleaning equipment which the Company has developed. With
its unique auto interior cleaning equipment the Company provides auto carpet and
seat upholstery cleaning services. The carwash building also has a boutique,
which is also the waiting room for customers. Windows allow customers to view
the equipment in operation. The boutique offers a wide range of convenience
items which include automotive products, convenience foods, gift items, and
greeting cards.
The Company presently has approximately thirty-five (35) full time and 30
part time employees.
The carwash tunnel has the following equipment which is listed in the
sequence of the cleaning cycle:
1. Vacuums
2. Prep
- Chemical tire applicator (CTA) applies cleaning chemical to tires.
3. Tunnel
- Presoak Arch - applies cleaning chemical for tough dirt and road grime.
- Foamerator - Applies cleansing agent, with optical brightners.
- Whippersnappers - Cleans car from side to side with soft cloths.
- Wrap-arounds - Cleans car front to back and side to side with soft cloth.
- Tire Brushes - Cleans tire sidewalls.
- Neon Super Sudsers - Applies concentrated cleaning foam.
- Whippersnappers - Cleans car from front to back with soft cloths.
- Undercarriage Wash - Removes soil from undercarriage of car.
- Set of 2x2's - Side wheel clothes to clean lower door panels.
- Tri - Color Wax Arch - applies three clearcoat waxes.
- Wash Module - Whippersnappers and side wheel clothes (2nd set) for polish
wax.
- Rust Inhibitor - High pressure water with rust inhibitor applied to
undercarriage.
- Low volume rinse, wax arch - Rinses car exterior and applies sealer wax.
- Booster nozzles side dryers - Air jets dry sides of car.
- Infrared perform air dryer - Complete forced air drying system.
4. Drying Area
- Wipe and Windows - Car is hand dried completely and windows are finished
off with a glass cleaning solution by hand.
- At the end of the tunnel is a large four bay drying area, where the wash
is completed and the customer picks up their car.
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5. Quality Control
- Manager inspects washed vehicles to assure that the service meets the
Company's standards.
- The Company recycles all water used in the carwash and reuses
approximately 80% of the water.
6. Services
The Company provides a variety of services ranging from a basic wash
package to a complete interior detail package.
Carpet Express
Carpet Express is a unique system that the Company developed to clean
automotive interiors, both carpeting and upholstery. The Carpet Express process
uses a combination of hot water, chemicals, and suction to wash, clean and
shampoo automotive carpets and upholstery. After the cleaning process the
interior is dry. Management believes that the Carpet Express process offers the
best available means, on a commercial scale, to clean automotive carpet and
upholstery. Carpet Express offers to a full service carwash additional services
to market to customers thereby increasing sales dollars per vehicle.
The carwash has used the Carpet Express system and process for cleaning
automotive interior carpeting and upholstery since the carwash facilities were
opened in March of 1990. The Company's experience during fiscal 1995 was that
approximately 8% of the carwash customers purchased the Carpet Express service
and these services accounted for approximately 15% of revenues.
The equipment used in the carpet and upholstery system is unique to the
Company and, in management's opinion, is superior to any equipment available to
clean automotive interiors on a commercial scale in the carwash environment.
During 1991 the Company introduced the Carpet Express system to the carwash
industry. A demonstration unit was manufactured and shown at the annual
International Carwash Association show in Chicago. Several leads were developed
although the Company was unable to sell any of the systems. Due to continued
resistance from Carwash operators over the cost of the system, the Company
sought to revise the package. During late 1992 and early 1993 production
agreements were reached with CFR Corp. to manufacture cleaning machines for
Carpet Express. Based upon continued price resistance the Company received from
perspective clients in early 1994, the agreement with CFR Corp. to manufacture
the Carpet Express machines was terminated. A new agreement was reached with
Century 400, Inc. to manufacture machines for the Company. The new machine has
a significantly reduced selling price, along with being easier to maintain. Blue
Coral Systems supplies and distributes cleaning solutions for the machines. The
Company is the exclusive distributor of the machines for the Carwash and Detail
industries.
This new system is unique in several ways. First, it recycles chemical and
water through a holding tank, allowing multiple cars to be cleaned with one fill
of the machine. Other competing systems must be refilled for each vehicle or
when the holding tank is empty. Second, because of the Cleaning Wand design,
the carpet is approximately 95% dry after cleaning. This feature eliminates the
need for separate drying system. The new system is significantly less
complicated and expensive and requires a minimum setup time.
The Company sold 10 systems throughout the country during 1995.
Lease and Facility
The Company leases, from a company controlled by Daniel Pentelute, the
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majority shareholder of the Company, the land and buildings at 6500 South State,
Murray, Utah. Two buildings are located on the property, each with a drive
through tunnel. The buildings are attractive and are well maintained. The
property is well landscaped and the environment created seeks to project a
positive, clean, and professional image. In the full service carwash industry
the Company's buildings and grounds have been shown as model facilities and have
been used in advertising by those firms which participated in the development of
the facilities.
The larger of the two buildings houses the boutique, carwash tunnel and
offices. Its dimensions are approximately 192 feet by 65 feet. The office
space on the second floor of the building is comprised of approximately 4000
square feet. There is a reception area, day room facilities, storage rooms, and
six offices. The second building houses Carpet Express operations and is
approximately 3500 square feet. Inside it are a drive through tunnel, two
offices, and an equipment room.
The property on which the two buildings sit is approximately 3.5 acres.
The facilities are visible from the major beltway in Salt Lake County and from a
major thoroughfare which passes by the front of the property. The daily car
count for the major thoroughfare at the front of the property is approximately
37,000 cars per twenty-four hour period.
The Company's carwash targets the upper-middle class market. Most of the
cars washed are late model, more expensive vehicles. The customer ratio is
approximately 50-50 male and female. The Company believes that a high ratio of
its customers are women because of the aesthetic appeal of the buildings and
grounds. At carwash conventions the Company's carwash has been shown as an
example of the work product of some of the participants in the construction of
the carwash facilities.
Competition
In the Greater Salt Lake area there are approximately 160 carwashes, known
as rollovers, located at gas stations. A rollover is a system of three rotating
brushes that simultaneously wash the top and sides of the vehicle. The major
gas companies offer free carwashes with gas purchases.
In the area are nine other full service washes, which compete directly with
the Company. It is believed the Company has a better location, superior
equipment, more aesthetic facilities, and better services to offer its customers
than the competition. The Company has no meaningful data as to the size of the
carwash market or the Company's share in that market.
In addition, competition comes from coin operated self service washes. In
the area there are approximately thirty four coin operated carwashes. Also
locally there are two mechanical touchless rollover operations. The vehicles
are cleaned chemically without brushes.
Management believes its operations will mature with time as its facility
and services become better known and more recognized by the motoring public.
The overall market for the Company's services is imprecise. Management believes
that the single biggest determinant of sales volume is the weather. If the
weather is stormy or overcast, business declines. With good weather, sales
increase dramatically.
Inflation and Foreign Exchange.
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Management believes that inflation and foreign exchange rates have no
effect on its operations or profits.
ITEM 2. PROPERTIES
The Company has a five (5) year lease on the buildings and real estate
housing its carwash operations and corporate headquarters. The Lessor,
Pentelute Properties, is an entity owned by Daniel F. Pentelute, the majority
shareholder of the Company. The lease is what is referred to as a triple net
lease as the Company is responsible for all costs associated with the property
as well as rental payments. The monthly payments to the Lessor commenced on
June 1, 1991, and are on a percentage basis. Initially, rent was four per cent
of the gross sales, excluding fuel sales. On April 1, 1992, the monthly
percentage increased to seven per cent (7%) with a minimum amount of $5,000 per
month. In April 1992 the lease was amended to correct a provision that had
mistakenly placed responsibility for property taxes on the Lessor. The Company
maintains its corporate headquarters on the premises. The two buildings housing
the carwash and Carpet Express tunnels sit on approximately 3.5 acres of land.
Under the lease the Company provides two offices to the Lessor. In addition,
under the lease the Company has an option to renew the lease for an additional
five year term at a monthly rental of seven per cent (7%) of monthly gross
proceeds excluding fuel sales with a minimum rent of $5,000 monthly. Also, the
lease grants the Company an option to purchase the property commencing at the
end of the initial five year term. The Company may exercise the option any year
on the anniversary date of the lease in the five year option term. The purchase
price is $2,330,000 capitalized at four per cent (4%) per annum from April 1,
1990.
On June 21, 1993, the Company purchased approximately 1.67 acres of land
located at approximately 3750 West 4700 South, West Valley City, Utah. The
property was purchased for the specific purpose of building a second carwash for
the Company. This particular piece of property was purchased because of the
high traffic counts surrounding it and its location in an area which is not
being served by any other full service carwash. To this point in time,
architectural designs have been prepared but no construction has begun on said
property. Construction of the second carwash will be contingent upon the
Company's obtaining the necessary financing for such a project. The Company is
uncertain, at this point in time, as to when construction on said carwash might
begin.
The property was purchased for $310,000 of which $270,000 was financed at
7.5% interest. The Company makes interest only payments on a monthly basis and,
pursuant to the trust deed securing the property, principal must be reduced by
$25,000 on March 1 and September 1 of each year through 1996. The entire unpaid
balance, at that point in time, is due in full on or before September 1, 1998.
During September, 1994, Daniel Pentelute, the major stockholder of the
Company, purchased 21 acres of land in Montana. Three days later the Company
purchased a one half interest in this land from Mr. Pentelute at his cost. The
other one half interest is owned by Desert Land Enterprises, whose sole
shareholder is Daniel Pentelute. The cost of the one half interest was $52,590
of which the Company still owed $21,699 as of December 31, 1995. Monthly
payments on the land are $1,155 and the loan is secured by the land. It is
anticipated by the Company that it will be able to sell the land during 1996 at
a substantial profit.
ITEM 3. LEGAL PROCEEDINGS
The Company was the Plaintiff in a law suit filed in the Third District
Court, Salt Lake County, State of Utah, which was styled Buffs 'N' Puffs, Ltd.
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vs. Murray City Corporation, Civil No. 940901637CN. The litigation generally
involved a claim made by Murray City Corporation for the sum of $70,325,
allegedly representing under-billed electrical service from January 12, 1990 to
January 7, 1994. The Complaint basically asked the court to find that Murray
City Corporation had no claim to collect the amount requested by it. Counsel
for the Company had indicated that they had been attempting to informally
resolve the matter with Murray City in a manner acceptable to both parties.
They also said that, given the facts in the case, it was believed that the
Company had an excellent chance for a favorable outcome. Until this matter was
resolved the Company had created a contingent liability for the entire amount on
its balance sheet and had expensed the entire amount during 1993.
On September 5, 1995 the case entitled Buffs-N-Puffs, Ltd. v. Murray City
Corp. was heard in the Third District Court of Utah. At this hearing Summary
Judgement was granted for Buffs-N-Puffs, Ltd. and against Murray City. The
judge signed the Summary Judgement order on September 26, 1995.
On October 10, 1995 the Third District Court dismissed all claims with
prejudice in the lawsuit entitled above.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the year ended 1995, no matters were submitted by the Company for a
vote to its security holders. However, on January 19, 1995 a special meeting of
shareholders was held. At this meeting the 1994 Board of Directors was re-
elected, auditors were ratified, and new by-laws for the Company were adopted.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK & RELATED SHAREHOLDERS
MATTERS.
The Company's common stock is traded in the over the counter market.
Previously the Company's common stock traded on the NASDAQ system under the
symbol PUFF. In March, 1992 the Company's securities were de-listed from the
NASDAQ system because of the inability to comply with new criteria. The
information below, since the end of the first quarter of 1992, was provided by
Alpine Securities of Salt Lake City, Utah and does not necessarily represent
prices of actual sales of the Company's common stock, nor does it take into
account any brokerage discounts, commissions, or fees. At the close of business
on March 7, 1996 the Company had approximately 645 stockholders of record.
QUARTER HIGH BID HIGH ASK LOW BID LOW ASK
First 1995 3/4 1/2 1/64 1/8
Second 1995 1/2 1/2 1/64 1/64
Third 1995 1/2 3/8 1/64 1/64
Fourth 1995 3/8 3/8 1/8 1/8
First 1994 1/8 3/8 1/8 3/8
Second 1994 1/8 3/8 1/8 3/8
Third 1994 1/8 3/8 1/8 3/8
Fourth 1994 1/8 3/8 1/8 3/8
First 1993 3/32 7/32 3/32 7/32
Second 1993 1/8 3/8 1/8 3/8
Third 1993 3/16 1/2 3/16 1/2
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Fourth 1993 1/4 3/4 1/4 3/4
First 1992 3/32 7/32 3/32 7/32
Second 1992 3/32 7/32 3/32 7/32
Third 1992 3/32 7/32 3/32 7/32
Fourth 1992 3/32 7/32 3/32 7/32
No dividends have been paid nor are any anticipated in the foreseeable future.
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ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
--------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Total Revenues $1,544,118 $1,633,892 $1,444,466 $1,112,921(1) $ 918,622 (1)
Net Operating Revenues (Loss) 195,957 117,704 83,748 39,754 (111,562)
Net Income (Loss) from
continuing operations 195,957 117,704 83,748 39,754 (111,562)
Net Income (Loss) 133,857 109,604 281,648(2) 39,534(2) (111,786)(2)
Total Assets $1,448,539 $1,503,992 $1,472,827 $ 912,594 $1,052,656
Total Stockholders' Equity $1,193,768 $1,108,863 $ 950,307 $ 668,659 $ 629,125
Long Term Debt 136,612 203,551 285,149 129,268 172,444
</TABLE>
NOTES
(1) Because of certain changes in 1993, certain revenues for 1991 and 1992 have
been reclassified as other income rather than revenues, thus decreasing total
revenues for 1991 and 1992. The income statements for 1991 and 1992 have been
reclassified to be consistent with the income statement of 1993.
(2) In February, 1992 the Financial Accounting Standards Board adopted a new
standard which requires that deferred tax balances be adjusted to reflect the
tax rates in effect when those amounts are expected to become payable or
refundable. This statement was required to be applied in the company's
financial statements for the year 1993.
The company was given the choice of either restating prior period financial
statements or recognizing the cumulative effect of the change in 1993. The
company chose to recognize the cumulative effect of the change during 1993. Had
the company chose to make the adjustments in 1991 and 1992 rather than totally
in 1993, the net income of the company would have been $87,648 in 1993 rather
than $241,648, earnings per share would have been $.01, rather than $.05. In
addition, the net income in 1992 would have been $24,534 rather than $39,534 and
the net income in 1991 would have been $57,214 rather than a loss of $111,786.
ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS
On March 22, 1990, the Company commenced its carwash operation at 6500
South State Street, Salt Lake City, Utah. Previously, the Company had not
engaged in any meaningful business operations and the Company had no revenues
generated from business operations.
1995 to 1994
As of December 31, 1995 the Company had cash of $177,086 compared to cash
of $183,741 as of December 31, 1994, a decrease of $6,655 (3.6%). The decrease
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is attributable to the Company's decreased revenue.
Current assets as of December 31, 1995 were $462,012 compared to $382,718,
an increase of $79,294 (20.7%). Property, plant, and equipment were $751,815 as
of December 31, 1995 compared to $834,024 as of December 31, 1994, a decrease of
$82,209 (9.8%). The decrease is mainly attributable to normal depreciation
expense.
Current liabilities as of December 31, 1995 were $118,159 compared to
$170,205 as of December 31, 1994, or a decrease of $52,046 (30.6%). Long term
liabilities decreased from $203,551 as of December 31, 1994 to $136,612 as of
December 31 ,1995, a decrease of $66,939 (32.9%). Total liabilities as of
December 31, 1995 were $254,771 compared to $373,756 as of December 31, 1994, a
decrease of $118,985 (31.8%). Total liabilities decreased due to lower accounts
payable and continuing reduction of debt.
Stockholders' Equity as of December 31, 1995 was $1,193,768 compared to
$1,059,911 as of December 31, 1994, an increase of $133,857 (12.6%). This
increase is primarily attributable to profits from operations, and the dismissal
of the Murray City lawsuit.
Total revenues for the year ended December 31, 1995 were $1,554,118
compared to total revenues for the year ended December 31, 1994 of $1,633,892.
Total revenues decreased by $79,774, or an approximate 4.9% decrease when
compared to the previous year. The primary reason for this decrease is the
decrease in the number of cars being serviced at the carwash due to weather
conditions, and lower Carpet Express equipment sales. The drop in carwash
volume was partially offset by a price increase in carwash services. Total
costs and expenses for the year ended December 31, 1995 were $1,390,363 compared
to costs and expenses of $1,540,497 for the year ended December 31, 1994. Total
costs and expenses decreased by $150,134 or an approximate decrease of 9.8% when
compared to the previous year. The primary reason for the decrease in costs and
expenses was the decrease in labor due to equipment upgrades and changing
chemicals used in the carwash process. The net income (before income tax
benefit) for the year ended December 31, 1995 was $195,957 compared to net
income for the year ended December 31, 1994 of $117,704, or an increase of
$78,253, an approximate 66.5% increase. The net income per share of the
Company's common stock for 1995 was $.02 per share compared to a net income of
.02 per share in 1994. The current ratio of the Company as of December 31, 1995
was 3.91 compared to the current ratio as of December 31, 1994 of 2.24. This is
primarily the result of the profitability of the Company for the 1995 year.
Management intends to increase revenues and volume by continuing to offer
the highest quality service in the carwash business. Further cost reduction is
anticipated due to continuing updating of carwash equipment and chemical
applications. A price increase instituted in March of 1995 appears to have had
little effect on carwash volumes, while increasing profitability. It is
anticipated that profitability will increase further with the price increase in
effect for the full year.
1994 to 1993
As of December 31, 1994, the Company had cash of $183,718 compared to cash
of $130,377 as of December 31, 1993, an increase of $53,364 (40.9%). This
increase in cash was primarily the result of the Company's increased revenue.
Current assets as of December 31, 1994 were $382,718 compared to $312,458,
an increase of $70,260 (22.5%), again primarily due to the increase in the
Company's revenues and net income. Property, plant and equipment were $834,024
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as of December 31, 1994 compared to $921,427 as of December 31, 1993 or a
decrease of $87,403 (9.5%). This decrease is primarily attributable to normal
depreciation expense.
Current liabilities as of December 31, 1994 were $170,205 compared to
$167,046 as of December 31, 1993 or an increase of $3,159 (1.9%). Long-term
liabilities also decreased from $285,149 as of December 31, 1993 to $203,551 as
of December 31, 1994. Total liabilities as of December 31, 1994 were $373,756
compared to $452,195 as of December 31, 1993 or an decrease of $78,439(17.3%)
The decrease in long-term liabilities were primarily caused by the reduction
of long term debt.
Stockholders' equity as of December 31, 1994 was $1,059,911 compared to
$950,307 as of December 31, 1993 or an increase of $109,604, which is
approximately 11.5%. This increase is attributable to profits from operations.
Total revenues for the year ended December 31, 1994 were $1,633,892
compared to total revenues of $1,444,466 for the year ended December 31, 1993.
Total revenues increased by $189,426 or an approximate thirteen percent (13%)
increase when compared to the year earlier. Total costs and expenses for the
year ended December 31, 1994 were $1,540,497 compared to $1,379,336 for the year
ended December 31, 1993 or an increase of $161,161 (approximately 11.7%). The
increase in revenues primarily resulted from the increase in the number of cars
that were serviced by the Company. This results from the Company's maturing
process, the public becoming more acquainted with the Company and its location,
and favorable weather factors. The increase in costs and expenses primarily
results from the Company's increase in revenues which requires additional labor,
additional percentage rent, and related expenses. The net income (before income
tax benefit) for 1994 was $117,704 versus $83,748 for the year of 1993 or an
increase of $33,956 (approximately 40.5% increase). The net income per share of
the common stock for 1994 was $.02 per share, including the income tax benefit
described above, versus a net income in 1993 of $.05 per share. As discussed in
Note D in the financial statements attached hereto, in February, 1992, the
Financial Accounting Standards Board adopted a new standard numbered 109 which
required that all deferred tax balances be adjusted to reflect the tax base in
effect when those amounts are expected to become payable or refundable. This
statement was required to be applied in the Company's financial statements for
the calendar year commencing January 1, 1993 and the Company chose to recognize
the cumulative effects of the change during the year of 1993. Because of this
reason, an adjustment was made to the 1993 income thereby increasing it in the
amount of $197,900 and thereby increasing the 1993 net income to $281,648. Had
said benefit been recognized in 1991, 1992 and 1993 the net income for 1993
would have been $.01 per share rather than $.05 per share. This is primarily
the result in the increased revenues of the Company and the aforementioned
income tax benefit. The current ratio of the Company as of December 31, 1994
was 2.24 versus the current ratio as of December 31, 1993 of 1.87. This is
primarily a result of the profitability of the Company for the 1994 year.
1993 to 1992
As of December 31, 1993, the Company had cash of $130,377 compared to cash
of $42,756 as of December 31, 1992, a increase of $87,621. This increase in
cash was primarily the result of the Company's increased revenue and increased
net income.
Current assets as of December 31, 1993 were $312,458 compared to $172,023,
a increase of $140,435 again primarily due to the increase in the Company's
revenues and net income. Property, plant and equipment were $921,427 as of
December 31, 1993 compared to $693,348 as of December 31, 1992 or a increase of
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$228,079 primarily due to the acquisition of land, during 1993, for an
additional carwash.
Current liabilities as of December 31, 1993 were $167,046 compared to
$114,667 as of December 31, 1992 or an increase of $52,379. Long-term
liabilities also increased from $129,268 as of December 31, 1992 to $285,149 as
of December 31, 1993. Total liabilities as of December 31, 1993 excluding a
contingent liability explained under Item III (Legal Proceedings), were $452,195
compared to $243,935 as of December 31, 1992 or an increase of $208,260. The
increases in current and long-term liabilities were primarily caused by the
acquisition of aforementioned land and the debt associated therewith.
Stockholders' equity as of December 31, 1993 was $950,307 compared to
$668,659 as of December 31, 1992 or an increase of $281,648 which is
approximately a forty two percent (42%) increase. This increase is attributable
to profits from operations, as well as the Accounting changes referred to in
Note 2 above.
Revenues for the year ended December 31, 1993 were $1,444,466 compared to
total revenues of $1,112,921 for the year ended December 31, 1992. Total
revenues increased by $331,545 or a thirty percent (30%) increase when compared
to the year earlier. Total costs and expenses for the year ended December 31,
1993 were $1,379,336 compared to $1,084,955 for the year ended December 31, 1992
an increase of $294,381. The increase in revenues primarily resulted from the
increase in the number of cars that were serviced by the Company. This results
from the Company's maturing process, the public becoming more acquainted with
the Company and its location, and favorable weather factors. The increase in
costs and expenses results from the Company's increase in carwash volume,
leading to higher rent expense, labor costs and chemical costs. The net income
for 1993 was $83,748 versus $39,754 for the year of 1992. After the change in
accounting rules to reflect the income tax benefit discussed above, the net
income in 1993 was $281,648 versus $39,534 for 1992 or an increase of $242,114.
Net income per share of the common stock for 1993 was $.05 per share versus a
net income of .01 per share in 1992. This is primarily the result in the
increased revenues of the Company. The current ratio of the Company as of
December 31, 1993 was 1.87 versus the current ratio as of December 31, 1992 of
1.50. This is primarily caused by the profitability of the Company for the 1993
year.
1992 to 1991
As of December 31, 1992, the Company had cash of $ 42,756 compared to cash
of $142,610 as of December 31, 1991. The decrease in cash was primarily the
result of the Company acquiring additional equipment and reducing its debt.
Because of the profitability of the Company in 1992, management was of the
belief that it was no longer necessary to maintain a high cash level for
continuing losses but would be more advantageous to reduce the Company's debt.
Current assets as of December 31, 1992, were $172,023 compared to $217,998
as of December 31, 1991, an decrease of $45,975. Property, plant and equipment
were $693,348 as of December 31, 1992, compared to $775,577 as of December 31,
1991, a decrease of $82,229. Total assets decreased by $140,062 from
$1,052,656 as of December 31, 1991, to $912,594 as of December 31, 1992. The
decrease in total assets is attributable to the reduction of cash and
depreciation.
Current liabilities as of December 31, 1992, were $114,667 compared to
$251,087 as of December 31, 1991, a decrease of $136,420. Long-term
liabilities decreased by $43,176 from $172,444 as of December 31, 1991, to
$129,268 as of December 31, 1992. Total liabilities as of December 31, 1992
were $243,935 compared to $423,531 as of December 31, 1991, a decrease of
$179,596. The
11
<PAGE>
decreases in current and long-term liabilities were primarily caused by
paying off certain of its loans payable. In addition, the Company reduced
its liabilities from cash generated from its operations.
Shareholders' equity as of December 31, 1992 was $668,659 compared to
$629,125 as of December 31, 1991, an increase of $39,534 which is approximately
six per cent (6%). The increase is attributable to profits from operations.
Total revenues for the year ended December 31, 1992 were $1,112,921
compared to total revenues of $918,622 for the year 1991. Total revenues
increased $194,299 or a total of twenty one per cent (21%) when compared to a
year earlier. Total costs and expenses for 1992 were $1,084,955 compared to
$1,085,650 for a year earlier. This represents a decrease of $695. The net
income for 1992 was $39,534 compared to the net loss for 1991 of $(111,786).
The net loss per share of common stock for 1992 was $.007 compared to a net loss
per share for 1991 of $(.016). The current ratio as of December 31, 1992 was
1.50 compared to 0.87 as of December 31, 1991.
In March 1991 management discontinued its residential carpet cleaning
operations. Management believed that the residential carpet cleaning operations
were not profitable. The Company had two carpet cleaning trucks which provided
carpet cleaning services to residences and commercial establishments. When the
Company discontinued its residential carpet cleaning services, one truck was
sold and the other truck was transferred to Lou Waterfall to effect a complete
and full release by Mr. Waterfall of any claims, liabilities and obligations the
Company may have had to him. The shareholders approved and ratified the
transfer of the truck to Mr. Waterfall.
LIQUIDITY AND CAPITAL RESOURCES.
Operations.
As of December 31, 1995, the Company's working capital was $343,853 and
included cash and cash equivalents of $177,086 as compared with $212,513 in
working capital and $183,741 in cash and cash equivalents at December 31, 1994.
During the three years ended December 31, 1995, the cash provided by operating
activities more than offset the amount of cash used in the Company's operating
activities. The net cash provided by operating activities in these three
periods were $244,338 in 1995, $264,592 in 1994, and $250,632 in 1993. The
Company does not anticipate any change from the positive cash provided by
operating activities during 1996.
Investing Activities.
The net cash used by the Company's investing activities increased from
$87,939 in 1993 to $105,948 in 1994, and $141,632 in 1995. The primary use of
cash for investing activities has been additional purchase of publicly traded
stock, purchase of land, and purchase of property and equipment.
Financing Activities.
The cash used by the Company's financing activities was $75,072 in 1993,
$105,280 in 1994, and $109,361 in 1995. The primary uses of cash for financing
activities has been the reduction in the Company's long term debt.
Expansion Program.
During 1993 the Company acquired land in the western area of the Salt Lake
Valley to use for the purpose of a second carwash location. To date the cash
12
<PAGE>
flow from the Company's operating activities have been sufficient to make the
payments on the mortgage on said land and to provide cash for the initial
activities including design, feasibility studies, and architectural drawings.
No construction has commenced on said site because the Company does not have
sufficient cash resources to finance said construction. The Company is desirous
of commencing construction on said site and has been pursuing financing
alternatives including additional long term debt or the sale of additional
shares of the Company to provide equity capital. To date, no such long term
debt or additional equity capital is committed to. The Company is uncertain as
to when it will be able to undertake this project.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA
(On following pages)
13
<PAGE>
C O N T E N T S
(a) 1. Financial Statements
The following Financial Statements of BUFFS-N-PUFFS, LTD.
are included in PART II, ITEM 8:
Page
INDEPENDENT AUDITOR'S REPORT . . . . . . . . . . . . . . . . . . . . . . 13
FINANCIAL STATEMENTS:
BALANCE SHEETS -
December 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . 14
STATEMENTS OF OPERATIONS -
years ended December 31, 1995, 1994 and 1993 . . . . . . . . . . . . . . 16
STATEMENTS OF STOCKHOLDERS' EQUITY -
years ended December 31, 1995, 1994 and 1993 . . . . . . . . . . . . . 17
STATEMENTS OF CASH FLOWS -
years ended December 31, 1995, 1994 and 1993 . . . . . . . . . . . . . 18
NOTES TO THE FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . 19
(a) 2. Financial Statement Schedules
The following financial statement schedules of BUFFS-N-PUFFS,
LTD. are included in PART IV, ITEM 14(d) (3):
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
ON SUPPLEMENTARY FINANCIAL INFORMATION . . . . . . . . . . . . . . . . 30
SCHEDULE I - MARKETABLE SECURITIES . . . . . . . . . . . . . . . . . . . 31
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT . . . . . . . . . . . . . . . 32
SCHEDULE VI - ACCUMULATED DEPRECIATION AND
AMORTIZATION OF PROPERTY, PLANT AND EQUIPMENT . . . . . . . . . . . . . 33
All other schedules are omitted because they are not applicable, or not
required, or because the required information is included in the consolidated
financial statements or notes thereto.
14
<PAGE>
Smith & Company
Certified Public Accountants
10 West 100 South, #700 Telephone: 801-575-8297
Salt Lake City, UT 84101 Facsimile: 801-575-8306
INDEPENDENT AUDITOR'S REPORT
Board of Directors and Shareholders
Buffs-N-Puffs, Ltd.
Salt Lake City, Utah
We have audited the accompanying balance sheets of Buffs-N-Puffs, Ltd. as of
December 31, 1995 and 1994 and the related statements of operations,
stockholders' equity and cash flows for the years ended December 31, 1995,
1994 and 1993. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we 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 also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Buffs-N-Puffs, Ltd. at
December 31, 1995 and 1994 and the results of its operations and its cash
flows for the years ended December 31, 1995, 1994 and 1993 in conformity with
generally accepted accounting principles.
/s/ Smith & Company
CERTIFIED PUBLIC ACCOUNTANTS
Salt Lake City, Utah
February 8, 1996
15
<PAGE>
BUFFS-N-PUFFS, LTD.
BALANCE SHEETS
December 31, 1995 and 1994
December 31,
-----------------------
1995 1994
---------- ----------
ASSETS
CURRENT ASSETS:
Cash $ 177,086 $ 183,741
Receivables (Note E) 16,241 26,168
Marketable securities, at market
value (at December 31, 1995,
aggregate cost was $268,166 and aggregate
market value was $220,317; at December 31,
1994 aggregate cost was $171,525 and
aggregate market value was $110,502) (Note A
and Schedule I) 220,317 110,502
Inventory (Note A) 26,525 29,499
Prepaid expenses and supplies 21,843 32,808
---------- ----------
TOTAL CURRENT ASSETS 462,012 382,718
PROPERTY, PLANT AND EQUIPMENT (at cost)
(Note A and Schedules V and VI):
Building improvements 194,621 194,044
Furniture, fixtures and equipment 855,952 848,673
Land 310,185 310,185
---------- ----------
1,360,758 1,352,902
Less accumulated depreciation 608,943 518,878
---------- ----------
751,815 834,024
OTHER ASSETS
Start-up costs (Note F) 49,757 39,921
Deposit 4,365 4,739
Montana Land (Note J) 52,590 52,590
Deferred tax asset (Note D) 128,000 190,000
---------- ----------
234,712 287,250
---------- ----------
$1,448,539 $1,503,992
========== ==========
See notes to the financial statements.
16
<PAGE>
BUFFS-N-PUFFS, LTD.
BALANCE SHEETS
December 31, 1995 and 1994
December 31,
------------------------
1995 1994
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and payroll and sales taxes $ 48,923 $ 58,547
Loans payable (Note C) 55,087 54,631
Loans payable - related parties (Note C) 14,149 55,441
Leases payable (Notes B and C) - 0 - 1,586
---------- ----------
TOTAL CURRENT LIABILITIES 118,159 170,205
LONG-TERM LIABILITIES:
Loans payable (Note C) 136,612 192,292
Loans payable - related parties (Note C) - 0 - 11,259
---------- ----------
136,612 203,551
---------- ----------
TOTAL LIABILITIES 254,771 373,756
Contingent liability (Note I) - 0 - 70,325
STOCKHOLDERS' EQUITY:
Capital stock, common, authorized 100,000,000
shares of $0.0001 par value; issued
6,113,900 shares, including 109,000 shares
of treasury stock, outstanding 6,004,900 611 611
Additional paid-in capital 1,120,692 1,120,692
Retained earnings (deficit) 121,417 (12,440)
---------- ----------
1,242,720 1,108,863
Less Treasury stock - at cost (109,000
shares) (48,952) (48,952)
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 1,193,768 1,059,911
---------- ----------
$1,448,539 $1,503,992
========== ==========
See notes to the financial statements.
17
<PAGE>
BUFFS-N-PUFFS, LTD.
STATEMENTS OF OPERATIONS
Years Ended December 31,
----------------------------------------
1995 1994 1993
---------- ---------- ----------
REVENUES:
Carwash $1,514,958 $1,588,853 $1,388,752
Boutique sales - net 30,005 25,202 21,413
Fuel sales - net 18,687 17,798 17,760
Carpet express equipment
sales - net 1,205 13,442 24,264
Discounts (10,737) (11,403) (7,723)
---------- ---------- ----------
TOTAL REVENUES 1,554,118 1,633,892 1,444,466
---------- ---------- ----------
COSTS AND EXPENSES:
Salaries, labor
and commissions 648,770 737,315 624,646
Taxes and benefits 113,251 120,081 99,852
Interest and credit card fees 76,661 73,958 61,842
Travel, auto, promotional and
advertising 39,293 26,812 20,610
Office, telephone, printing and
supplies 184,933 180,040 141,437
Utilities, building maintenance,
rent and insurance 177,714 256,954 295,757
Depreciation and amortization 105,420 110,002 108,327
Professional fees and other 44,321 35,335 26,865
---------- ---------- ----------
TOTAL COSTS AND EXPENSES 1,390,363 1,540,497 1,379,336
---------- ---------- ----------
NET INCOME BEFORE OTHER 163,755 93,395 65,130
OTHER INCOME (EXPENSE)
Contract services and
miscellaneous 2,260 20,910 17,345
Interest and dividends 7,218 5,162 2,491
Loss on equipment sales (4,978) - 0 - - 0 -
Gain on sale of securities
(cost determined by specific
identification) 17,495 7,903 571
Adjustment of securities
to market 10,207 (9,666) (1,789)
---------- ---------- ----------
32,202 24,309 18,618
---------- ---------- ----------
NET INCOME BEFORE TAXES 195,957 117,704 83,748
INCOME TAXES (BENEFIT)
(Note D) 62,100 8,100 (197,900)
---------- ---------- ----------
NET INCOME $ 133,857 $ 109,604 $ 281,648
========== ========== ==========
NET INCOME PER SHARE
OF COMMON STOCK (based on
weighted average number
of shares outstanding) $ .02 $ .02 $ .05
========== ========== ==========
See notes to the financial statements.
18
<PAGE>
BUFFS-N-PUFFS, LTD.
STATEMENTS OF STOCKHOLDERS' EQUITY
Common Stock Additional Retained
------------------- Paid-in Earnings
Shares Amount Capital (Deficit)
--------- ------ ---------- ---------
Balances
12/31/92 6,113,900 $611 $1,120,692 $(403,692)
Net income for
year ended
12/31/93 281,648
--------- ---- ---------- ---------
Balances
12/31/93 6,113,900 611 1,120,692 (122,044)
Net income for
year ended
12/31/94 109,604
--------- ---- ---------- ---------
Balances
12/31/94 6,113,900 611 1,120,692 (12,440)
Net income for
year ended
12/31/95 133,857
--------- ---- ---------- ---------
Balances
12/31/95 6,113,900 $611 $1,120,692 $ 121,417
========= ==== ========== =========
See notes to the financial statements.
19
<PAGE>
BUFFS-N-PUFFS, LTD.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------
1995 1994 1993
--------- --------- ---------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income $133,857 $ 109,604 $ 281,648
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 105,420 110,002 108,327
Book value of assets sold 8,977 - 0 - - 0 -
(Increase) decrease in deferred
tax asset 62,000 8,000 (198,000)
Adjust securities to lower of cost
or market (10,207) 9,666 1,789
Changes in operating assets and
liabilities:
(Increase) decrease in receivables 9,927 28,875 (14,216)
(Increase) decrease in prepaid
expense, supplies and deposits 11,339 96 (5,938)
(Increase) decrease in inventory 2,974 (1,002) (6,635)
(Increase) decrease in contingent
liability (70,325) - 0 - 70,325
Increase (decrease) in accounts
payable and payroll taxes
payable (9,624) (649) 13,332
--------- --------- ---------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 244,338 264,592 250,632
INVESTING ACTIVITIES
Cost of securities sold 86,367 26,356 29,305
Purchase of securities (185,975) (80,887) (57,481)
Purchase of land - 0 - (25,100) - 0 -
Increase in start-up costs (15,900) (10,000) - 0 -
Purchase of property and equipment (26,124) (16,317) (59,763)
--------- --------- ---------
NET CASH (USED)
BY INVESTING ACTIVITIES (141,632) (105,948) (87,939)
FINANCING ACTIVITIES
Repayment of loans and leases (109,361) (105,280) (75,072)
--------- --------- ---------
NET CASH (REQUIRED) BY
FINANCING ACTIVITIES (109,361) (105,280) (75,072)
--------- --------- ---------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (6,655) 53,364 87,621
Cash and cash equivalents at
beginning of year 183,741 130,377 42,756
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF YEAR $ 177,086 $183,741 $130,377
========= ========= =========
SUPPLEMENTAL INFORMATION
Taxes paid $ 100 $ 100 $ 100
Interest paid 76,661 73,958 61,842
</TABLE>
SUPPLEMENTAL INVESTING AND FINANCIAL ACTIVITIES:
During 1993, the Company took out a mortgage of $270,000 to acquire land with a
cost of $310,185. During 1994, the Company took out a mortgage of $27,490 to
acquire land with a cost of $52,590.
See notes to the financial statements.
20
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REVENUE RECOGNITION:
Interest income is accrued as earned. Gains or losses on the sale of securities
are recorded as of the trade date.
DEPRECIATION:
Depreciation on office equipment and furniture is provided over the estimated
useful life of five to ten years using an accelerated method; and depreciation
on the building improvements is provided over the estimated useful lives of 10
to 31.5 years using the straight-line method.
MARKETABLE SECURITIES:
Marketable securities, as a group, are carried at market value in accordance
with FAS #115. Prior to January 1, 1994, the securities were carried at the
lower of cost or market. At December 31, 1995, an adjustment was made to
reflect the increase of $10,207 to market ($9,666 decrease for 1994 and $1,789
decrease for 1993).
INCOME TAXES:
The Company utilizes the liability method of accounting for income taxes as set
forth in Statement of Financial Accounting Standards No. 109, "Accounting for
Income Taxes" (SFAS 109). Under the liability method, deferred taxes are
determined based on the difference between the financial statement and tax bases
of assets and liabilities using enacted tax rates in effect in the years in
which the differences are expected to reverse. An allowance against deferred
tax assets is recorded when it is more likely than not that such tax benefits
will not be realized.
INVENTORY:
Inventory consists of items for sale and use in the operations of the carwash.
Inventory is recorded at the lower of cost or market, on a first-in, first-out
basis.
CASH AND CASH EQUIVALENTS:
For financial statement purposes, the Company considers all highly liquid
investments with an original maturity of three months or less when purchased to
be cash equivalents.
NOTE B - COMMITMENTS
The Company is occupying space in a building owned by a related party (see Note
H). The lease is with an entity controlled by the major shareholder of the
Company. The lease is five years in length. The lease also has escalating
provisions and is based on percentages of gross monthly sales excluding fuel
sales. During 1995, $112,643 was paid as rent ($118,437 for 1994 and $104,348
for 1993). At December 31, 1994, the Company was leasing a copy machine at a
monthly rental of $199. The copy machine lease was dated October 9, 1992 for a
period of 36 months. The lease has been treated as a capital lease. The
Company purchased the equipment at the end of the lease period.
Future minimum payments under the capital lease were as follows:
Year ending December 31, 1995 $ 1,685
Less amounts representing interest and sales tax 99
-------
Principal balance December 31, 1994 $ 1,586
=======
Scheduled principal reductions were as follows:
December 31, 1995 $ 1,586
=======
The Company is also obligated under a maintenance contract on its signs. The
contract was signed to be effective in January of 1992 and is three years in
length with monthly payments of $789. The contract was renewed in 1993 for an
additional three years, through December 31, 1996. During 1994, the Company
paid $5,000 for a 24 month lease on an automobile. The
21
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
$5,000 is being charged to expense at the rate of $208 per month.
NOTE C - LOANS PAYABLE
During 1990, the former President of the Company (Donna Anderson) and Daniel
Pentelute personally borrowed $518,000 from three financial institutions, using
their residence and other personal assets as collateral. $277,828 (including
loan costs of $7,270) of the money was used for the Company. The Company has
treated the obligations as being due to the individuals and is making the
monthly loan payments to the three institutions. In early 1994, one obligation
was paid in full, leaving two loans. The Company is also paying Mr. Pentelute
directly $3,018 monthly. The entire $3,018 applies to principal due. Interest
rates range from 8.75% to 11.25%. Total monthly payments on the two bank
obligations are $3,403. The following is a summary of debt at December 31, 1995
and 1994:
<TABLE>
<CAPTION>
1995 1994
INTEREST ---------------------- ----------------------
RATE % CURRENT LONG-TERM CURRENT LONG-TERM
---------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C>
G. Phillip Condie(1) 7.50 $ 50,000 $120,000 $ 50,000 $170,000
Copelco 6.00 - 0 - - 0 - 1,586 - 0 -
Escrow Services (2) 9.50 5,087 16,612 4,631 22,292
Dan Pentelute 8.75-11.25 14,149 - 0 - 55,441 11,259
-------- -------- -------- --------
$ 69,236 $136,612 $111,658 $203,551
======== ======== ======== ========
</TABLE>
(1) Monthly payments of interest only are $1,888 with principal payments of
$25,000 due March 1 and September 1 of 1996 and the balance due by 9/1/1998.
This loan is secured by land with a cost of $310,185.
(2) Monthly payments are $1,155. The loan is secured by land with a cost of
$52,590.
Scheduled principal reductions for the next five years are as follows:
12/31/96 $ 69,236
12/31/97 5,592
12/31/98 126,147
12/31/99 4,873
12/31/2000 - 0 -
--------
$205,848
========
22
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1995
NOTE D - INCOME TAXES
No federal income taxes were due for the year ended December 31, 1995. At
December 31, 1995, the Company had unused general business credits of $7,844
which expire in 1996 thru 2000, and contributions carryover of $23,318,
expiring in 1998 through 2000. The Company has a capital loss carryover of
$14,340 which expires in 1997. The Company also has a net operating loss
carryover which if not used will expire as follows:
<TABLE>
<CAPTION>
Amount Expiration Date
------------------- -----------------------
Year Ended Federal Utah Federal Utah
----------------- -------- -------- ---------- --------
<S> <C> <C> <C> <C>
December 31, 1990 $299,501 $ - 0 - 12/31/2005
December 31, 1991 123,837 123,637 12/31/2006 12/31/96
-------- --------
$423,338 $123,637
======== ========
</TABLE>
In February, 1992, the Financial Accounting Standards Board adopted Statement
of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME TAXES, which
supersedes substantially all existing authoritative literature for accounting
for income taxes and requires deferred tax balances to be adjusted to reflect
the tax rates in effect when those amounts are expected to become payable or
refundable. The Statement was applied in the Company's financial statements
for the calendar year commencing January 1, 1993 by recognizing the
cumulative effect of the change during 1993. The following pro forma
information reflects what the statements of operations would have looked like
if the deferred tax asset had been recognized in 1991 and 1992:
<TABLE>
<CAPTION>
1992 1991
-------- ---------
<S> <C> <C>
Income (loss) before cumulative effect
of recognizing a deferred tax asset $ 39,534 $(111,786)
Cumulative effect on prior years of
recognizing a deferred tax asset (15,000) 169,000
-------- ---------
Adjusted net income $ 24,534 $ 57,214
======== =========
Earnings (loss) per share - originally $ .01 $ (.02)
Adjusted earnings per share $ .00 $ .01
======== =========
</TABLE>
If the above adjustments had been reflected in 1991 and 1992, the Company would
have recorded an income tax benefit of $44,000 in 1993 rather than $198,000.
Net income would have been $87,648 rather than $241,648 and earnings per share
would have been $.01 rather than $.05.
23
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1995
Components of income tax expense are as follows:
<TABLE>
<CAPTION>
Year ended
December 31,
--------------------------------
1995 1994
---------- -----------
<S> <C> <C>
Current
Federal . . . . . . . . . . . . . . . . . $ - 0 - $ - 0 -
State . . . . . . . . . . . . . . . . . 100 100
--------- ----------
100 100
--------- ----------
Deferred
Federal . . . . . . . . . . . . . . . . . 60,100 6,100
State . . . . . . . . . . . . . . . . . 1,900 1,900
--------- ----------
62,000 8,000
--------- ----------
Income tax expense . . . . . . . . . . . . . . $ 62,100 $ 8,100
========= ==========
</TABLE>
Reconciliation of income taxes computed at the federal statutory rate and the
income tax expense are as follows:
<TABLE>
<CAPTION>
Year ended
December 31,
-------------------------------
1995 1994
---------- -----------
<S> <C> <C>
Federal income taxes at statutory rate . . . . $ 60,700 $ 36,500
State income taxes, net of federal benefit . . 3,000 1,800
Difference due to graduated federal rates. . . (1,600) (30,200)
---------- ----------
$ 62,100 $ 8,100
========== ==========
</TABLE>
Deferred tax assets and liabilities consist of the following:
<TABLE>
<CAPTION>
Year ended
December 31,
-------------------------------
1995 1994
---------- ----------
<S> <C> <C>
Net operating loss carryforward . . . . . $ 104,700 $ 158,700
Capital loss carryforward . . . . . . . . 4,100 8,900
Contributions carryforward. . . . . . . . 5,600 3,500
Additional cost of marketable
securities. . . . . . . . . . . . . . . 13,600 18,900
---------- ----------
Net deferred tax assets . . . . . . . . . $ 128,000 $ 190,000
========== ==========
</TABLE>
NOTE E - RECEIVABLES
Receivables at December 31, 1995 and 1994 consisted of the following:
<TABLE>
<CAPTION>
1995 1994
------- -------
<S> <C> <C>
Trade accounts receivable . . . . . . . . $16,241 $26,168
======= =======
</TABLE>
24
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
NOTE F - START-UP COSTS
These are costs associated with development of the carwash. The costs are being
amortized, depreciated or expensed. The costs include travel to view other
carwashes, equipment, inventory, legal fees for patents and trademarks, etc.
During 1995 and 1994, the Company spent $25,900 associated with property being
held for development into a second carwash operation. The cost will be
amortized when the carwash begins operations or added to the cost of the land if
the carwash is not developed.
NOTE G - STOCK OPTIONS
During 1991, options to purchase the Company's common stock were granted to
eight individuals who are or were officers, directors, employees and consultants
for the Company. A total of 610,000 shares of stock may be purchased at a price
of $.09375 per share. The options must be exercised by July 9, 1996.
NOTE H - RELATED PARTY TRANSACTIONS
During 1990, Donna Anderson and Daniel Pentelute arranged for three loans by
pledging their personal assets. Some of the proceeds from these loans were made
available to the Company. The Company has been making the payments for these
loans and the interest and principal have been amortized according to the
portion of the proceeds each party received.
On April 19, 1991, the Company entered into a five year lease with Daniel
Pentelute, the major shareholder of the Company. Under the lease, Mr. Pentelute
received, as rent, four per cent of the gross proceeds excluding gasoline sales
commencing on July 1, 1991, and continuing until April 1, 1992. At that time
and thereafter, Mr. Pentelute will receive seven per cent of the gross proceeds
from the carwash facility. On May 21, 1991, an addendum to the lease was
entered into providing for a five year option term at the end of the initial
five year term. The terms require a rent payment equal to 7% of monthly gross
sales, excluding gasoline sales with a minimum rent of $5,000 per month. In
addition, the Company has an option to purchase the land and buildings at 6500
South State Street, Salt Lake City, Utah, commencing at the end of the initial
term and exercisable at the anniversary date of the lease in each of the five
years under the option term. The purchase price of the property shall be
determined by the sum of $2,330,000 capitalized from April 1, 1990, to the date
of closing at the rate of four per cent per annum.
Also see Note J.
25
<PAGE>
BUFFS-N-PUFFS, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
NOTE I - CONTINGENT LIABILITY
On January 7, 1994, a letter was sent to the Company by a utility company
claiming that the Company was under-billed for its electrical service from
February 1990 through November 1993. The utility has determined the amount owed
to be $70,325 and intended to bill an extra $1,529 each month beginning in
February 1994 for a period of 46 months. The Company vigorously contested the
additional billing, but elected to record the contingent liability and increased
expense by $70,325 for 1993. The Company believed that the prior billings were
accurate and the utility company did not have a legitimate claim. The matter
was resolved in the Company's favor on September 26, 1995 with a summary
judgment entered in favor of the Company and against the utility company's
counterclaim. On October 10, 1995 all claims were dismissed with prejudice, and
each party was required to bear their own legal costs. The Company removed the
contingent liability from its records and reduced the utility expense by $70,325
for 1995.
NOTE J - MONTANA LAND
During 1994, Daniel Pentelute, the major shareholder of the Company, purchased
21 acres of land in Montana and three (3) days later sold a one-half interest to
the Company at his cost. The other one-half interest is owned by Desert Land
Enterprises, whose sole shareholder is Daniel Pentelute. The Company expects
to sell the land during 1996 at a substantial profit.
26
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
(a) Identification of Officers and Directors
(1) Andrew A. Chudd, President and Director
(2) Alan Theis, Secretary/Treasurer and Director
(3) W. Sterling Mason, Jr., Director
(4) Craig Celantano, Director
(5) Richard Castellow, Director
All directors serve until the next annual meeting of stockholders or until
their successors have been duly qualified and elected.
(c) Identification of certain significant employees.
Their business backgrounds are set forth in (e) hereinafter.
(d) Family relationships.
The Company's majority shareholder is Daniel Pentelute. Mr.
Pentelute is also the owner of the real property on which the carwash
is located. There are no family relationships between any of the
directors or officers.
(e) Business experience.
(1) Background
ANDREW A. CHUDD, 45, President and Director of the Company since August
1992, has been involved in the carwash industry for approximately 5 1/2 years in
both management and carwash equipment sales. Mr. Chudd graduated from Hamilton
High School in California in 1968. He has attended LA Pierce College and West
Los Angles College, but has received no degree. Since October of 1985 Mr. Chudd
has been an independent business consultant to various corporations and
businesses. Mr. Chudd worked, from 1974 until 1985, primarily as an Insurance
Agent and has had limited experience in publicly-held companies.
Mr. Chudd was President and Director of Discovery Systems, Ltd., a blind
pool/blank check company until February, 1988 at which time new officers and
directors were elected at a shareholders' meeting. Mr. Chudd was President and
Director, until the fall of 1989, of Celebrity Limousine, Ltd., a Utah Public
Company which operated a limousine service in Northern Utah under a permit from
the Utah Public Service Commission. Mr. Chudd was President and Director Of
Verazzana Ventures Ltd., a blind pool/blank check company until January 1, 1995,
at which time new officers and directors were elected at a shareholders'
meeting.
ALAN THEIS, 36, in 1982 received a bachelor of sciences degree in Business
Economics and Public Policy from Indiana University. Since July 1991 Mr. Theis
has been the Secretary and Treasurer of the Company. In March 1990, Mr. Theis
became the assistant accountant for the Company. From June 1988 to March 1990
Mr. Theis worked as a construction worker for Pentelute Properties, a company
controlled by Daniel Pentelute, the Company's major stockholder. From 1985 to
1987 Mr. Theis was an employee for the Park City Ski Corporation.
W. STERLING MASON, JR., 49, is a Director of the Company and has been since
January 1989, except for a short time at the beginning of 1991. Mr. Mason, is
presently involved
27
<PAGE>
in real estate investments and business opportunities in Mexico. Mr. Mason
was engaged in the private practice of law in Salt Lake City, Utah since
1975. His law practice focused on the business and securities areas of law.
Mr. Mason graduated from the University of Utah Law School in 1975 receiving
a Juris Doctor Degree. In addition, Mr. Mason received a Masters in Business
Administration from the University of Utah in 1974 and has a Bachelor of
Science Degree in Finance which he received in 1972. Prior to that time, Mr.
Mason was a stockbroker with various stock brokerage firms, both in Salt Lake
City, Utah and San Francisco, California.
CRAIG CELANTANO, 38, has been involved in the carwash industry since 1967.
Mr. Celantano has experience in carwash design and layout, equipment
installations and operations. He has owned and operated both self service and
full service carwashes. Mr. Celantano currently owns and operates a self service
location in Tucson, Arizona. He has been a distributor for Hanna carwash
equipment for 15 years. Mr. Celantano is currently Vice-President of Blue Coral
Systems, a leading manufacturer of carwash chemicals. He oversees the North
American sales force, as well as responsibilities in equipment design,
application, research and development.
RICHARD CASTELLOW, 46, received a bachelor of arts degree in economics from
the University of Washington in 1975. Since 1990 Mr. Castellow has been the
Northwest distributor for Belanger, Inc., a major manufacturer of carwash
equipment. During the last four years he has consulted and done work for the
majority of the largest carwashes in the northwest. From 1986 to 1989 Mr.
Castellow worked as a carwash consultant and an installer of equipment for
carwashes. In 1983 he became co-owner and operator of three Chevron gas stations
that included three exterior tunnel carwashes and seven self-serve carwash bays.
He operated the washes for three and a half years, at which time the partnership
was dissolved and the washes were sold.
(2) Directorships.
None of the officers and directors serve on the Board of any other company
whose securities are registered pursuant to Section 12 or subject to the
requirements of Section 15 (d) of the Exchange Act or any company registered
under the Investment Company Act of 1940, with the exception of Mr. Chudd who
was a director and officer of Verazzana Ventures, Ltd., which files periodic
reports under Section 15(d) of the exchange Act, until January, 1995.
(f) Involvement in certain legal proceedings.
None of the officers or directors have any disability as defined
in (1) through (6) of this item.
(g) Promoters and control persons.
Daniel Pentelute, although not an officer or director of the Company, is
the Company's largest and majority shareholder and, in addition, is the
Company's landlord. Mr. Pentelute, age 46, attended Brigham Young University
and the University of Utah between the years of 1967 and 1970. Mr. Pentelute
was the President and a Director of the Company from 1980 to 1985. He has been
a consultant to the Company and developed the Buffs 'N' Puffs carwash concept.
Since 1986 Mr. Pentelute has engaged in the development and management of real
property located in the states of Nevada, Utah and Montana. Mr. Pentelute is
also a private investor in various business enterprises and ventures.
ITEM 11. EXECUTIVE COMPENSATION
None of the officers and directors of the Company received remuneration in
excess of $60,000 (Sixty thousand dollars) for the year ended December 31, 1995.
REMUNERATION TABLE
1995 1996
NAME SERVING AS REMUNERATION PROPOSAL
- ------------------------- --------------------- ------------ --------
Andrew A. Chudd President, Director
since August 1992 $ 29,650 $32,000
W. Sterling Mason Jr. Director 0* 0*
28
<PAGE>
Craig Celantano Director 0 0
Richard Castellow Director 0 0
Alan Theis Secretary, Director $ 34,285 $35,000
-------- -------
TOTALS $ 63,935 $67,000
Aggregate remuneration for fiscal year 1995 totaled $63,935. At the
present time no remuneration is paid to any director for attendance at
director meetings. Expenses incurred to attend any board meetings may be
paid. Mr. Alan Theis and Mr. Andrew A. Chudd are full-time employees of the
Company. Mr. Mason, Mr Castellow and Mr. Celantano are solely directors of
the Company and, as such, only devote as much time as needed in that position.
*Mr. Mason will be compensated for any legal work performed for the
Company. During 1995 Mr. Mason received $5,478 as legal fees and reimbursement
for expenses for the Company.
EMPLOYEE STOCK OPTION PLAN
NONE.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS & MANAGEMENT
(a) (b) Security ownership of certain beneficial owners and management.
NAME AND ADDRESS AMOUNT AND NATURE
OF BENEFICIAL OF BENEFICIAL PERCENT OF
TITLE OF CLASS OWNER OWNERSHIP CLASS**
- -------------------- ---------------- ----------------- -----------
Common Stock Daniel F. Pentelute 3,293,525*
54.85%
6500 South State St.
Murray, Utah 84107
Andrew A. Chudd 200,000* * *
3.33%
Alan Theis 0* * *
0%
W. Sterling Mason, Jr.0*** 0%
* Includes 168,625 shares held by Penex, Inc., a Nevada Corporation and
44,000 shares held by Desert Land, Inc., a Nevada Corporation both of which Mr.
Pentelute is the sole shareholder.
** Based upon 6,004,900 shares outstanding without reduction of the treasury
shares held by the Company.
*** Does not include options approved on July 31, 1991 providing for a purchase
price of $0.09375 and a five year term. Mr. Chudd - 200,000 shares; Mr. Theis -
50,000 shares; and Mr. Mason - 50,000 shares. None of these options have been
exercised to date.
(c) Changes in Control
In 1991 Daniel F. Pentelute beneficially owned 2,428,825 shares of the
Company's common stock or approximately 40% of the total outstanding shares. In
addition, Donna M. Anderson, Mr. Pentelute's wife at the time, owned 1,143,625
shares or approximately 19% of the total outstanding shares. At that time Mr.
Pentelute and Ms. Anderson were involved in divorce proceedings. As a result of
said divorce proceedings, Mr. Pentelute received almost all of the shares held
by Ms. Anderson. Therefore his percentage ownership of the total outstanding
shares of the Company increased in 1992 from approximately 40% to 54.85%.
29
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
(a) Transactions with management and others.
Related Party Transactions.
In April 1990 the former President of the Company and her husband
personally borrowed $518,000 from three financial institutions, using their
residence and other personal assets as collateral. $277,328 (including loan
costs of $7,270) of the money was used for the Company. The Company has treated
the obligation as being due to these individuals and has been making monthly
loan payments to the three institutions. In early 1994 one obligation was paid
in full, leaving two loans with interest rates ranging from 8.75% to 10.5%. The
Company is not an obligor or a guarantor on any of the three obligations. As of
December 1, 1993, the Company is also paying Mr. Pentelute directly $3,018
monthly. The entire $3,018 applies to principal due. As of December 31, 1995 the
Company's total share for all these loans was approximately $14,149.
The Following table shows a list of the loans for which the Company has
made payments.
<TABLE>
<CAPTION>
ORIGINAL
LENDER PRINCIPAL INTEREST TERM
- ---------------------- ----------- ------------ -------------------
<S> <C> <C> <C>
Zions Bank* $250,000 Prime + 2% 5 yrs with balloon.
*Paid off as
of Jan 1, 1994
Valley Mortgage $234,000 11.05% 30 yrs
Great Western $ 34,000 Prime + 2.5% 15 yrs
Other Information.
</TABLE>
For the year ended December 31, 1995, the Company paid rent of $112,643 to
Pentelute Properties, a company controlled by Daniel Pentelute, the majority
shareholder of the Company who owns approximately 54.85% of the issued and
outstanding stock of the Company. The rent was paid pursuant to a lease which
has a five year term with a five year renewal option and an option to purchase
the property.
(b) Certain Business Relationships.
Business entities in which directors of the Company had an interest during
the last fiscal year have not had any transactions with the Company. However,
Director W. Sterling Mason, Jr. is an Attorney at Law. Mr. Mason was paid
$5,478 in 1995.
(c) Indebtedness of Management.
NONE.
(d) Transaction with promoters.
The Company has a five (5) year lease on the property and buildings for
its carwash. The Company leases the land and buildings from Pentelute
Properties, a d/b/a of Daniel F. Pentelute, a major shareholder of the
Company. Mr. Pentelute owns approximately 54.85% of the issued and
outstanding shares of the Company. Monthly payments commenced on June 1,
1991, and are based on a percentage of monthly gross sales excluding fuel
sales. Initially rental was four per cent (4%) of the gross sales excluding
fuel sales. On April 1, 1992, the monthly percentage increased to seven per
cent (7%). The Company also maintains its corporate headquarters on the
premises. Under the lease the Company provides two offices to the Lessor.
In addition, under the terms of the lease the Company has an option to renew
the lease for an additional five year term at a rental of seven per cent (7%)
of gross sales excluding fuel sales with a minimum rent of $5,000 monthly.
Also, the Company has an option to purchase the property commencing at the
end of the initial five year term which the option is exercisable on the
anniversary date of the lease each year in the five year option
30
<PAGE>
term. The purchase price is $2,330,000 capitalized at four per cent (4%)
per annum from April 1, 1990. For the year ended December 31, 1995, the Company
paid rent of $112,643 to Pentelute Properties.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
PAGE
----
(a) 1. Financial Statements
The following Financial Statements of BUFFS-N-PUFFS, LTD. are
included in PART II, ITEM 8:
See page 16 for table of contents
(a) 2. Financial Statement Schedules
The following financial statement schedules of BUFF-N-PUFFS, LTD. are
included in PART IV, ITEM 14(d) (3):
Report of Independent Certified Public Accountants on Supplementary
Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . 30
Schedule I -- Marketable Securities . . . . . . . . . . . . . . . . . . 31
Schedule V -- Property, Plant and Equipment . . . . . . . . . . . . . . 32
Schedule VI -- Accumulated Depreciation and Amortization of Property,
Plant and Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . 33
All other schedules are omitted because they are not applicable, or not
required, or because the required information is included in the consolidated
financial statements or notes thereto.
31
<PAGE>
Smith & Company
Certified Public Accountants
10 West 100 South, #700 Telephone: 801-575-8297
Salt Lake City, UT 84101 Facsimile: 801-575-8306
Board of Directors and Shareholders
Buffs-N-Puffs, Ltd.
Salt Lake City, Utah
Our audit of the basic financial statements presented in the preceding
section of this report was made primarily to form an opinion on such
financial statements taken as a whole. The additional information, contained
in the following pages, is not considered essential for the fair presentation
of the financial position of Buffs-N-Puffs, Ltd., the results of its
operations or cash flows in conformity with generally accepted accounting
principles. The following information consisting of Schedule I, Schedule V
and Schedule VI is included to comply with reporting requirements of the
Securities and Exchange Commission. Such data was subjected to the audit
procedures applied in the audit of the basic financial statements and, in our
opinion, are fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
/s/ Smith & Company
CERTIFIED PUBLIC ACCOUNTANTS
Salt Lake City, Utah
February 8, 1996
32
<PAGE>
BUFFS-N-PUFFS, LTD.
SCHEDULE I - MARKETABLE SECURITIES
<TABLE>
<CAPTION>
Market
Number Original Value
Name of Issuer of Shares Cost 12/31/95
- -------------- --------- -------- --------
<S> <C> <C> <C>
Interpac Alliance 5,000 $ 50 $ - 0 -
KMS Industries 2,750 33,438 343
Cirtech 50,000 1,000 - 0 -
Agri-world 4,000 25 - 0 -
Fast Eddies Racing Stables 5,000 5,000 - 0 -
Dimedix 1,334 200 - 0 -
NVF Company 10,000 4,202 - 0 -
Alfin Fragrances 5,000 8,809 6,374
Berkey, Inc. 1,000 5,930 - 0 -
Bally Gaming International 500 5,924 4,063
Fredericks of Hollywood A 1,000 5,869 4,250
Fredericks of Hollywood B 500 2,404 1,937
Westinghouse Electric 200 2,596 3,275
Maytag Corp. 4,600 76,627 93,150
Minimed Inc. 5,000 58,052 62,500
International Game Technology 4,000 56,518 43,000
Novell Inc. 100 1,522 1,425
---------- ----------
Totals* $ 268,166 $ 220,317
========== ==========
</TABLE>
*Marketable securities are carried on the balance sheets as current assets.
<TABLE>
<CAPTION>
Market
Number Original Value
Name of Issuer of Shares Cost 12/31/94
- -------------- --------- -------- --------
<S> <C> <C> <C>
Interpac Alliance 5,000 $ 50 $ - 0 -
KMS Industries 2,750 33,438 - 0 -
Cirtech 50,000 1,000 - 0 -
Agri-world 4,000 25 - 0 -
Fast Eddies Racing Stables 5,000 5,000 - 0 -
Dimedix 1,334 200 - 0 -
NVF Company 10,000 4,202 - 0 -
Alfin Fragrances 10,000 15,056 7,934
Berkey, Inc. 1,000 5,930 - 0 -
Marion Merrell Dow, Inc. 1,200 21,654 24,450
Bally Gaming International 300 4,114 3,187
Wellcome PLC ADR 1,500 14,472 16,312
Digital Equipment 300 9,435 9,975
Fredericks of Hollywood A 1,000 5,869 4,000
Fredericks of Hollywood B 500 2,404 1,750
Westinghouse Electric 200 2,596 2,450
Rallys Hamburger 1,000 4,081 3,000
Carter-Wallace 200 2,666 2,600
Maytag Corp. 500 8,555 7,500
Noram Energy Corp. 1,450 8,395 7,794
Shopko Stores, Inc. 1,500 16,607 14,250
Telefonica De Argentina Ord B 100 5,776 5,300
---------- ----------
Totals* $ 171,525 $ 110,502
========== ==========
</TABLE>
33
<PAGE>
BUFFS-N-PUFFS, LTD.
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>
Balance at Balance
Beginning Additions at End
of Period At Cost Retirement of Period
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Year ended December 31, 1993:
Land $ - 0 - $ 310,185 $ - 0 - $ 310,185
Leasehold improvements 192,294 1,750 - 0 - 194,044
Fixtures & equipment 840,348 17,828 18,170 840,006
---------- ---------- ----------- ----------
$1,032,642 $ 329,763 $ 18,170 $1,344,235
========== ========== =========== ==========
Year ended December 31, 1994:
Land $ 310,185 $ - 0 - $ - 0 - $ 310,185
Leasehold improvements 194,044 - 0 - - 0 - 194,044
Fixtures & equipment 840,006 16,317 7,650 848,673
---------- ---------- ----------- ----------
$1,344,235 $ 16,317 $ 7,650 $1,352,902
========== ========== =========== ==========
Year ended December 31, 1995:
Land $ 310,185 $ - 0 - $ - 0 - $ 310,185
Leasehold improvements 194,044 577 - 0 - 194,621
Fixtures & equipment 848,673 25,547 18,268 855,952
---------- ---------- ----------- ----------
$1,352,902 $ 26,124 $ 18,268 $1,360,758
========== ========== =========== ==========
</TABLE>
34
<PAGE>
BUFFS-N-PUFFS, LTD.
SCHEDULE VI - ACCUMULATED DEPRECIATION OF
PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>
Additions
Balance at Charged to Balance
Beginning Costs and at End
of Period Expenses Retirement of Period
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Year ended December 31, 1993:
Land $ - 0 - $ - 0 - $ - 0 - $ - 0 -
Leasehold improvements 41,331 15,102 - 0 - 56,433
Fixtures & equipment 297,963 86,582 18,170 366,375
-------- -------- -------- --------
$339,294 $101,684 $ 18,170 $422,808
======== ======== ======== ========
Year ended December 31, 1994:
Land $ - 0 - $ - 0 - $ - 0 - $ - 0 -
Leasehold improvements 56,433 15,144 - 0 - 71,577
Fixtures & equipment 366,375 88,576 7,650 447,301
-------- -------- -------- --------
$422,808 $103,720 $ 7,650 $518,878
======== ======== ======== ========
Year ended December 31, 1995:
Land $ - 0 - $ - 0 - $ - 0 - $ - 0 -
Leasehold improvements 71,577 15,203 - 0 - 86,780
Fixtures & equipment 447,301 84,153 9,291 522,163
-------- -------- -------- --------
$518,878 $ 99,356 $ 9,291 $608,943
======== ======== ======== ========
Depreciation for year $ 99,356
Amortization for year 6,064
--------
$105,420
========
</TABLE>
35
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Dated this ____ day of March, 1996.
BUFFS-N-PUFFS, LTD.
By /s/ ANDREW A. CHUDD
______________________________
Andrew A. Chudd
PRESIDENT, CHIEF EXECUTIVE
OFFICER, AND DIRECTOR
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
_______________________________ _____________________ _______________
<S> <C> <C>
/s/ ANDREW A. CHUDD President, Chief Executive
________________________________ Officer and Director
Andrew A. Chudd
/s/ ALAN R. THEIS Secretary/Treasurer,
________________________________ Chief Financial
Alan R. Theis Officer and Director
/s/ W. STERLING MASON, JR. Director
________________________________
W. Sterling Mason, Jr.
</TABLE>
36
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 117,086
<SECURITIES> 220,317
<RECEIVABLES> 16,241
<ALLOWANCES> 0
<INVENTORY> 26,525
<CURRENT-ASSETS> 462,012
<PP&E> 1,360,758
<DEPRECIATION> 608,943
<TOTAL-ASSETS> 1,448,539
<CURRENT-LIABILITIES> 118,159
<BONDS> 0
0
0
<COMMON> 611
<OTHER-SE> 1,242,109
<TOTAL-LIABILITY-AND-EQUITY> 1,448,539
<SALES> 1,564,855
<TOTAL-REVENUES> 1,554,118
<CGS> 0
<TOTAL-COSTS> 1,390,363
<OTHER-EXPENSES> 4,978
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 76,661
<INCOME-PRETAX> 195,957
<INCOME-TAX> 62,100
<INCOME-CONTINUING> 133,857
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 133,857
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
