U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED JUNE 30, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION
PERIOD FROM _______________ TO _______________
Commission file number 0-25901
CONCEPT CAPITAL CORPORATION
(Exact name of small business issuer as specified in charter)
UTAH 87-0422564
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
175 South Main Street, Suite 1210
Salt Lake City, Utah 84111
(Address of principal executive offices) (Zip Code)
(801) 364-2538
(Issuer's telephone number)
Not Applicable
(Former name, former address, and former fiscal year, if changed
since last report)
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 X No _
Applicable only to issuers involved in bankruptcy proceedings
during the preceding five years
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange
Act after the distribution of securities under a plan confirmed
by a court. Yes No
Applicable only to corporate issuers
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date
As of August 11, 2000, the issuer had outstanding 4,425,000
shares of common stock, par value $0.001.
Transitional Small Business Disclosure Format
(Check one):
Yes _ No X
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FORWARD LOOKING STATEMENTS
This report contains forward-looking statements as defined
in the Private Securities Litigation Reform Act of 1995. Such
statements reflect the Company's views with respect to future
events based upon information available to it at this time.
These forward-looking statements are subject to certain
uncertainties and other factors that could cause actual results
to differ materially from such statements. These uncertainties
and other factors include, but are not limited to: the ability of
the Company to locate a business opportunity for acquisition or
participation by the Company; the terms of the Company's
acquisition of or participation in a business opportunity; and
the operating and financial performance of any business
opportunity following its acquisition or participation by the
Company. The words "anticipates," "believes," "estimates,"
"expects," "plans," "projects," "targets" and similar expressions
identify forward looking statements. Readers are cautioned not
to place undue reliance on these forward looking statements,
which speak only as of the date the statement was made. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new
information, changes in assumptions, future events or otherwise.
Part I--Financial Information
Item 1. Financial Statements
Concept Capital Corporation (the "Issuer"), files herewith
balance sheets of the Issuer as of June 30, 2000 and December 31,
1999, the related statements of operations and statements of
comprehensive income (loss) for the three and six month periods
ended June 30, 2000 and 1999, and for the period from May 21,
1985 (inception) through June 30, 2000, and the related
statements of cash flows for the six month periods ended June 30,
2000 and 1999, and for the period from May 21, 1985 (inception)
through June 30, 2000. In the opinion of management of the
Issuer, the financial statements reflect all adjustments, all of
which are normal recurring adjustments, necessary to fairly
present the financial condition of the Issuer for the interim
periods presented. The financial statements included in this
report on Form 10-Q should be read in conjunction with the
audited financial statements of the Issuer and the notes thereto
included in its annual report on Form 10-KSB for the year ended
December 31, 1999.
CONCEPT CAPITAL CORP.
[A Development Stage Company]
UNAUDITED CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2000
2
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CONCEPT CAPITAL CORP.
[A Development Stage Company]
CONTENTS
PAGE
Accountants' Review Report 4
Unaudited Condensed Balance Sheets, June 30,
2000 and December 31, 1999 5
Unaudited Condensed Statements of Operations,
for the three and six months ended June 30,
2000 and 1999 and for the period from
inception on May 21,1985 through June 30,
2000 6
Unaudited Condensed Statements of Cash Flows,
for the six months ended June 30, 2000 and
1999 and for the period from inception on
May 21,1985 through June 30, 2000 7 - 8
Notes to Unaudited Condensed Financial
Statements 9 - 11
3
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ACCOUNTANTS' REVIEW REPORT
Board of Directors
CONCEPT CAPITAL CORP.
Salt Lake City, Utah
We have reviewed the accompanying condensed balance sheet of
Concept Capital Corp. (A Development Stage Company) as of June
30, 2000, and the related condensed statements of operations for
the three and six months ended June 30, 2000 and for the period
from inception on May 21, 1985 through June 30, 2000 and the
statement of cash flows for the six months ended June 30, 2000
and for the period from inception on May 21, 1985 through June
30, 2000. All information included in these financial statements
is the representation of the management of Concept Capital Corp.
We conducted our review in accordance with standards established
by the American Institute of Certified Public Accountants. A
review consists principally of inquiries of Company personnel and
analytical procedures applied to financial data. It is
substantially less in scope than an audit in accordance with
generally accepted auditing standards, the objective of which is
the expression of 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 condensed financial
statements reviewed by us, in order for them to be in conformity
with generally accepted accounting principles.
/s/ PRITCHETT, SILER & HARDY, P.C.
PRITCHETT, SILER & HARDY, P.C.
July 31, 2000
Salt Lake City, Utah
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CONCEPT CAPITAL CORP.
[A Development Stage Company]
CONDENSED BALANCE SHEETS
[Unaudited - See Accountants' Review Report}
ASSETS
June 30, December 31,
2000 1999
___________ ___________
CURRENT ASSETS:
Cash in bank $ 251,510 $ 254,522
Prepaid expense 1,078 -
___________ ___________
Total Current Assets 252,588 254,522
___________ ___________
$ 252,588 $ 254,522
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ - $ 100
Accrued Income Taxes - 50
___________ ___________
Total Current Liabilities - 150
___________ ___________
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value,
50,000,000 shares authorized,
4,425,000 shares issued and
outstanding 4,425 4,375
Capital in excess of par value 250,830 243,380
Earnings accumulated during the
development stage (2,667) 6,617
___________ ___________
Total Stockholders' Equity 252,588 254,372
___________ ___________
$ 252,588 $ 254,522
___________ ___________
Note: The Balance Sheet as of December 31, 1999, was taken from the
audited financial statements at that date and condensed.
The accompanying notes are an integral part of these unaudited condensed
financial statements.
5
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CONCEPT CAPITAL CORP.
[A Development Stage Company]
CONDENSED STATEMENTS OF OPERATIONS
[Unaudited - See Accountants' Review Report]
For the Three For the Six From Inception
Months Ended Months Ended on May 21,
June 30, June 30, 1985 Through
___________________________________ June 30,
2000 1999 2000 1999 2000
_________ ________ ________ _______ ____________
REVENUE: $ - $ - $ - $ - $ -
_________ ________ ________ _______ ____________
Total Revenues - - - - -
_________ ________ ________ _______ ____________
OPERATING EXPENSES:
General and
administrative 15,465 5,349 16,387 19,374 93,259
Amortization - - - - 500
_________ ________ ________ _______ ____________
Total Operating
Expenses (15,465) (5,349) (16,387)(19,374) (93,759)
_________ ________ ________ _______ ____________
OTHER INCOME (EXPENSE):
Interest, dividends,
and capital gain
distributions 3,618 2,780 7,103 5,597 139,880
Gain from sale of
available-for-sale
securities - - - 10,138 19,334
Loss on sale or
abandonment of
available-for-sale
securities - - - - (61,763)
_________ ________ ________ _______ ____________
Total Other Income
(Expenses) 3,618 2,780 7,103 15,735 97,451
_________ ________ ________ _______ ____________
INCOME (LOSS) BEFORE
INCOME TAXES (11,847) (2,569) (9,284) (3,639) 3,692
CURRENT TAX EXPENSE - - - - 6,359
DEFERRED TAX EXPENSE - - - - -
_________ ________ ________ _______ ____________
NET INCOME (LOSS) $ (11,847)$ (2,569)$ (9,284)$(3,639)$ (2,667)
_________ ________ ________ _______ ____________
INCOME (LOSS) PER
COMMON SHARE $ (.00)$ (.00)$ (.00)$ (.00)$ (.00)
_________ ________ ________ _______ ____________
The accompanying notes are an integral part of these unaudited condensed
financial statements.
6
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CONCEPT CAPITAL CORP.
[A Development Stage Company]
CONDENSED STATEMENTS OF CASH FLOWS
[Unaudited - See Accountants' Review Report]
For the Six From Inception
Months Ended on May 21,
June 30, 1985 Through
_______________________ June 30,
2000 1999 2000
__________ ___________ _________
Cash Flows From Operating
Activities:
Net income $ (9,284) $ (3,639) $ (2,667)
Adjustments to reconcile
net income (loss)to
net cash used by operating
activities:
Stock issued for services
rendered 7,500 - 7,500
Amortization expense - - 500
Net realized (gain) loss
on disposition of
securities - (17,442) 42,429
Changes in assets and
liabilities:
(Decrease) in accounts
payable (100) (470) -
Increase (decrease) in
income taxes payable (50) (1,623) -
(Increase) in prepaid
expenses (1,078) (1,083) (1,078)
(Increase) deferred
income taxes - (4,359) -
__________ ___________ _________
Net Cash Provided (Used)
by Operating Activities (3,012) (28,616) 46,684
__________ ___________ _________
Cash Flows From Investing
Activities:
Payment of organization costs - - (500)
Proceeds from sale of securities - 144,300 259,032
Purchase of securities - - (301,461)
__________ ___________ _________
Net Cash Provided (Used)
by Investing Activities - - (42,929)
__________ ___________ _________
Cash Flows From Financing
Activities:
Proceeds from common stock
issuance - 2,625 262,000
Payments for stock offering
costs - 102,375 (14,245)
__________ ___________ _________
Net Cash Provided by
Financing Activities - 105,000 247,755
__________ ___________ _________
Net Increase (Decrease) in Cash (3,012) 220,684 251,510
Cash at Beginning of Period 254,522 29,853 -
__________ ___________ _________
Cash at End of Period $ 251,510 $ 250,537 $ 251,510
__________ ___________ _________
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
[Continued]
7
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CONCEPT CAPITAL CORP.
[A Development Stage Company]
CONDENSED STATEMENTS OF CASH FLOWS
[Unaudited - See Accountants' Review Report]
[CONTINUED]
Supplemental Schedule of Noncash Investing and Financing
Activities:
For the period ended June 30, 2000
The Company issued 50,000 shares of common stock for services
rendered at $7,500 (or at $0.15 per share).
For the period ended June 30, 1999:
None.
The accompanying notes are an integral part of these financial statements.
8
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CONCEPT CAPITAL CORPORATION
[A Development Stage Company]
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Concept Capital Corporation (the Company) was
organized under the laws of the State of Utah on May 21, 1985.
The Company is seeking potential business opportunities for
acquisition or participation. The Company has not yet generated
significant revenues from its planned principal operations and is
considered a development stage company as defined in Statement of
Financial Accounting Standards (SFAS) No. 7. The Company has, at
the present time, not paid any dividends and any dividends that
may be paid in the future will depend upon the financial
requirements of the Company and other relevant factors.
Accounting Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosures 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 estimated by management.
Cash and Cash Equivalents - For purposes of the financial
statements, the Company considers all highly liquid debt
instruments purchased with a maturity of three months or less to
be cash equivalents.
Concentration of Credit Risk - As of June 30, 2000, the Company
had cash balances in excess of federally insured amounts of
approximately $151,500.
Investments - Investments in available-for-sale securities are
carried at fair value. Unrealized gains and losses, net of the
deferred tax effects, are included as a separate element of
stockholders' equity. Realized gains and losses are based on the
difference between sales price and actual cost of the securities
and are included in earnings.
Income (Loss) Per Share - The computation of income (loss) per
share is based on the weighted average number of shares
outstanding during the period presented in accordance with
Statement of Financial Accounting Standards No. 128, "Earnings
Per Share" [See Note 7].
Comprehensive Income - The Company adopted the provisions of SFAS
No. 130, "Reporting Comprehensive Income", during 1999.
Recently Enacted Accounting Standards - Statement of Financial
Accounting Standards (SFAS) No. 132, "Employer's Disclosure about
Pensions and Other Postretirement Benefits", SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities",
SFAS No. 134, "Accounting for Mortgage-Backed Securities.", SFAS
No. 135 "Rescission of FASB Statement No. 75 and Technical
Corrections", SFAS No. 136, "Transfers of Assets to a not for
profit organization or charitable trust that raises or holds
contributions for others, " and SFAS No. 137, " Accounting for
Derivative Instruments and Hedging Activities - deferral of the
effective date of FASB Statement No. 133 (an amendment of FASB
Statement No. 133)," were recently issued. SFAS No. 132, 133,
134, 135, 136, and 137 have no current applicability to the
Company or their effect on the financial statements would not
have been significant.
9
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CONCEPT CAPITAL CORPORATION
[A Development Stage Company]
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 2 - AVAILABLE-FOR-SALE SECURITIES
The Company had previously invested in mutual fund shares which
were accounted for as investments available-for-sale. At
December 31, 1998, these shares had unrealized gains of $21,801
(with an estimated tax effect of $4,359). During the year ended
December 31, 1999 the Company sold all of its holdings and
realized a gain of $10,138 from the proceeds of $132,637.
NOTE 3 - COMMON STOCK
During May 2000, the Company issued 50,000 shares of common stock
for legal services rendered at $7,500 (or $0.15 per share).
During March 1999, the Company issued 2,625,000 shares of common
stock for cash proceeds of $105,000 ($.04 per share) to an
individual and six other investors. Stock offering costs of
$1,000 were netted against additional paid in capital. The
issuance of common stock resulted in a change of control of the
Company [See Note 5].
During July 1986, the Company completed a public offering of
1,450,000 shares of common stock for gross proceeds of $145,000,
or $.10 per share. Offering costs of $13,245 were offset against
the proceeds of the offering.
During May 1985, in connection with its organization, the Company
issued 300,000 shares of common stock to its original officers
and directors and their associates for total proceeds of $12,000,
or $.04 per share.
NOTE 4 - INCOME TAXES
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes". SFAS No. 109 requires the Company to provide
a net deferred tax asset/liability equal to the expected future
tax benefit/expense of temporary reporting differences between
book and tax accounting methods and any available operating loss
or tax credit carryforwards. At June 30, 2000, the Company has
available operating loss or tax credit carryforwards of
approximately $2,600, which may be applied against future taxable
income and which expire in various years through 2020.
The amount of and ultimate realization of the benefits from the
operating loss carryforwards for income tax purposes is
dependent, in part, upon the tax laws in effect, the future
earnings of the Company, and other future events, the effects of
which cannot be determined. Because of the uncertainty
surrounding the realization of the loss carryforwards the Company
has established a valuation allowance equal to the tax effect of
the loss carryforwards and, therefore, no deferred tax asset has
been recognized for the loss carryforwards. The net deferred tax
assets is approximately $800 as of June 30, 2000, with an
offsetting valuation allowance of the same amount resulting in a
change in the valuation allowance of approximately $800 during
the six months ended June 30, 2000.
10
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CONCEPT CAPITAL CORPORATION
[A Development Stage Company]
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 5 - CHANGE IN CONTROL
During March 1999, an individual and six other investors
purchased 2,625,000 shares of common stock of the Company [See
Note 3] giving them a 60% controlling interest in the Company.
The former officers and directors resigned and the individual was
elected as the new president and a member of the board of
directors.
NOTE 6 - RELATED PARTY TRANSACTIONS
Management Compensation - The Company did not pay compensation to
its officers but paid $300.00 in directors fees during the period
ended June 30, 2000.
Rent - The Company shares office space with entities related to
an officer/shareholder of the Company. Beginning in April 1999,
the Company has agreed to pay $180 rent per month for its share
of the office space. The Company paid approximately $539 for the
three months ended June 30, 2000 for its share of the office
space.
NOTE 7 - EARNINGS PER SHARE
The following data show the amounts used in computing income
(loss) per share and the effect on income and the weighted
average number of shares of dilutive potential common stock for
the periods presented:
For the Three For the Six From Inception
Months Ended Months Ended on May 21,
June 30, June 30, 1985 Through
___________________________________ June 30,
2000 1999 2000 1999 2000
_________ _________ __________ _________ __________
Income (loss)
from continuing
operations
applicable to
common
stockholders
(numerator) $ (11,847)$ (2,569)$ (9,284)$ (3,639)$ (3,160)
_________ _________ __________ _________ __________
Weighted average
number of
common shares
outstanding
used in earnings
per share during
the period
(denominator) 4,403,571 4,375,000 4,389,286 3,490,331 1,869,442
_________ _________ __________ _________ __________
Dilutive earnings per share was not presented, as the Company had
no common equivalent shares for all periods presented that would
affect the computation of diluted earnings per share.
11
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Item 2. Management's Discussion and Analysis or Plan of Operation
Plan of Operation
During the next twelve months, and thereafter if required,
the officers and directors of the Company will utilize their
business contacts in an effort to locate a business opportunity
for acquisition or participation by the Company. Such contacts
may include investment bankers and other securities
professionals, lawyers, accountants, industry consultants,
members of management of public and private companies, business
brokers, and personal acquaintances. When and if a potential
business opportunity is located, the Company=s officers and
directors may incur travel expenses in connection with their
review of such opportunity and, if they determine to proceed
further, may also incur expenses for the engagement of
professionals such as lawyers and accountants to assist in a Adue
diligence@ review of the opportunity and the negotiation and
preparation of the necessary legal documents. While the precise
nature and amount of such expenses cannot be foreseen at this
time, the Company anticipates that its current assets will be
adequate to pay such expenses during the next twelve months. As
of June 30, 2000, the Company had net assets in the form of cash
and cash equivalents in the approximate amount of $252,000. The
Company anticipates that the interest income it earns on such
amount will be sufficient to pay the majority of the Company's
limited operating expenses, including rent, filing fees, and
routine legal and accounting fees, for the next twelve months,
leaving the majority of such assets available for expenses
incurred in connection with the location, evaluation, and
acquisition of a business opportunity.
During the second quarter of 2000, the Company was invoiced
for and paid legal expenses in the amount of approximately $9,500
for services performed since 1999, including those associated
with the filing of the Company's Form 10SB. In order to conserve
cash, the Company negotiated the payment of $7,500 of such
expenses through the issuance of 50,000 shares of its restricted
stock at a price of $0.15 per share, which was approximately 48%
of the bid price for the Company's common stock on the OTC
Bulletin Board on the date the agreement was made. During the
quarter, the board of directors also determined to meet on a
regular basis once each quarter and to compensate the individual
directors at the rate of $100 per meeting attended by them.
The Company cannot presently foresee the cash requirements
of any business opportunity that may ultimately be acquired by
the Company. However, since it is likely that any such business
will be involved in active business operations, the Company
anticipates that an acquisition will result in increased cash
requirements as well as increases in the number of employees of
the Company.
Part II--Other Information
Item 1. Legal Proceedings
The Issuer is not a party to any material pending legal
proceedings and, to the best of its knowledge, its properties are
not the subject of any such proceedings.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
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Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
No exhibits are being filed with this report.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter
for which this report is filed.
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.
Concept Capital Corporation
Date: August 14, 2000 By /s/ T. Kent Rainey
T. Kent Rainey, President
(Principal Accounting and
Financial Officer)
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