FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended June 30, 1998
Commission File Number 33-3328-D
COFITRAS ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
Nevada 87-041035
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1155 E. 2100 S., No. 325, Salt Lake City, Utah 84106
(Address of principal executive offices)
(Zip Code)
(801) 483-1864
(Registrant's telephone number, including area code)
Check whether the issuer (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act 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 X No
---- ----
State the number of shares outstanding of each of the issuer's classes
of common equity, as of August 11, 1998: 59,041,509.
<PAGE>
<TABLE>
<CAPTION>
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements.
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Balance Sheets
ASSETS
June 30, December 31,
1998 1997
----------------- ----------------
(Unaudited)
CURRENT ASSETS
<S> <C> <C>
Cash $ 3,485 $ -
----------------- -----------------
Total Current Assets 3,485 -
----------------- -----------------
TOTAL ASSETS $ 3,485 $ -
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 10,616 $ 9,690
Note payable - related party 5,000 -
----------------- -----------------
Total Current Liabilities 15,616 9,690
----------------- -----------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock 300,000,000 shares authorized, at
$0.001 par value; 59,041,509 and 59,041,509 shares
shares issued and outstanding, respectively 59,041 59,041
Additional paid-in capital 124,199 124,199
Deficit accumulated during the development stage (195,371) (192,930)
----------------- -----------------
Total Stockholders' Equity (Deficit) (12,131) (9,690)
----------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 3,485 $ -
================= =================
</TABLE>
The accompanying notes are an integral part of the
financial statements.
2
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
From
Inception on
April 12,
For the Three For the Six 1989 to
Months ended June 30, Months ended June 30, June 30,
1998 1997 1998 1997 1998
------------- -------------- ------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
------------- -------------- ------------- -------------- -------------
EXPENSES - - - - -
------------- -------------- ------------- -------------- -------------
LOSS FROM DISCONTINUED
OPERATIONS (1,936) - (2,441) - (195,371)
------------- -------------- ------------- -------------- -------------
NET LOSS $ (1,936) $ - $ (2,441) $ - $ (195,371)
============= ============== ============= ============== =============
NET LOSS PER SHARE $ (0.00) $ 0.00 $ (0.00) $ 0.00
============= ============== ============= ==============
WEIGHTED AVERAGE SHARES
OUTSTANDING 59,041,509 59,041,509 59,041,509 59,041,509
============= ============== ============= ==============
</TABLE>
The accompanying notes are an integral part of the
financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on April 12, 1989 through June 30, 1998
Deficit
Accumulated
Capital in During the
Common Excess of Development
Shares Stock Par Value Stage
----------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Balance at inception on
April 12, 1989 1,805,200 $ 1,805 $ 21,418 $ -
Net loss for the period ended
December 31, 1989 - - - (9,218)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1989 1,805,200 1,805 21,418 (9,218)
Common stock issued for patent
rights at $0.00 per share on
March 26, 1990 10,903,990 10,904 (9,904) -
Common stock issued for cash
at $0.003 per share on
April 25, 1990 1,848,874 1,849 24,651 -
Common stock issued for cash
at $0.10 per share on
December 4, 1990 10,000 10 4,990 -
Net loss for the year ended
December 31, 1990 - - - (41,969)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1990 14,568,064 14,568 41,155 (51,187)
Common stock issued for services
rendered at $0.015 per share
during 1991 100,000 100 1,400 -
Net loss for the year ended
December 31, 1991 - - - (9,977)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1991 14,668,064 $ 14,668 $ 42,555 $ (61,164)
----------------- --------------- ---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the
financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
From Inception on April 12, 1989 through June 30, 1998
Deficit
Accumulated
Capital in During the
Common Excess of Development
Shares Stock Par Value Stage
----------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Balance, December 31, 1991 14,668,064 $ 14,668 $ 42,555 $ (61,164)
Common stock issued for cash and
assets contributed by shareholders
during 1992 at approximately $0.001
per share 40,000,000 40,000 (3,971) -
Net loss for the year ended
December 31, 1992 - - - (6,370)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1992 54,668,064 54,668 38,584 (67,534)
Additional capital contributed - - 46,710 -
Net loss for the year ended
December 31, 1993 - - - (79,255)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1993 54,668,064 54,668 85,294 (146,789)
Net loss for the year ended
December 31, 1994 - - - -
----------------- --------------- ---------------- -----------
Balance, December 31, 1994 54,668,064 54,668 85,294 (146,789)
Additional capital contributed - - 35,778 -
Common stock issued for services
valued at $0.002 per share 4,373,445 4,373 3,127 -
Net loss for the year ended
December 31, 1995 - - - (43,778)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1995 59,041,509 59,041 124,199 (190,567)
Net loss for the year ended
December 31, 1996 - - - -
----------------- --------------- ---------------- -----------
Balance, December 31, 1996 59,041,509 $ 59,041 $ 124,199 $ (190,567)
----------------- --------------- ---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the
financial statements.
5
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
From Inception on April 12, 1989 through June 30, 1998
Deficit
Accumulated
Capital in During the
Common Excess of Development
Shares Stock Par Value Stage
----------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Balance, December 31, 1996 59,041,509 $ 59,041 $ 124,199 $ (190,567)
Net loss for the year ended
December 31, 1997 - - - (2,363)
----------------- --------------- ---------------- ----------------
Balance, December 31, 1997 59,041,509 59,041 124,199 (192,930)
Net loss for the six months ended
June 30, 1998 (unaudited) - - - (2,441)
----------------- --------------- ---------------- ----------------
Balance, June 30, 1998 (unaudited) 59,041,509 $ 59,041 $ 124,199 $ (195,371)
================= =============== ================ ================
</TABLE>
The accompanying notes are an integral part of the
financial statements.
6
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
Inception on
April 12,
For the Three For the Six 1989 to
Months ended June 30, Months ended June 30, June 30,
1998 1997 1998 1997 1998
------------- ------------- ------------- ------------- --------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S> <C> <C> <C> <C> <C>
Income (loss) from operations $ (1,936) $ - $ (2,441) $ - $ (195,371)
Adjustments to reconcile net
income to net cash provided
by operating activities:
Amortization - - - - 1,183
Common stock issued for services - - - - 9,000
Changes in operating assets and liabilities:
Decrease (increase) in other
assets - - - - 11,029
Increase (decrease) in
shareholder payable - - - - (3,003)
Increase (decrease) in
accounts payable 421 - 926 - 13,119
------------- ------------- ------------- ------------- --------------
Net Cash Used by Operating
Activities (1,515) - (1,515) - (164,043)
------------- ------------- ------------- ------------- --------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Cash acquired upon reorganization
of Company - - - - 23,540
------------- ------------- ------------- ------------- --------------
Net Cash Provided by Investing
Activities - - - - 23,540
------------- ------------- ------------- ------------- --------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Borrowing from related party 5,000 - 5,000 - 5,000
Issuance of common stock for cash - - - - 56,500
Additional capital contributed - - - - 82,488
------------- ------------- ------------- ------------- --------------
Net Cash Provided by Financing
Activities $ 5,000 $ - $ 5,000 $ - $ 143,988
------------- ------------- ------------- ------------- --------------
</TABLE>
The accompanying notes are an integral part of the
financial statements.
7
<PAGE>
<TABLE>
<CAPTION>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
Inception on
April 12,
For the Three For the Six 1989 to
Months ended June 30, Months ended June 30, June 30,
1998 1997 1998 1997 1998
------------- -------------- ------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
CASH AND CASH
EQUIVALENTS $ 3,485 $ - $ 3,485 $ - $ 3,485
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD - - - - -
------------- -------------- ------------- -------------- -------------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 3,485 $ - $ 3,485 $ - $ 3,485
============= ============== ============= ============== =============
Cash Paid For:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
Non-Cash Financing Activities:
Issuance of common stock for
for contract costs $ - $ - $ - $ - $ -
Issuance of common stock for
patent rights $ - $ - $ - $ - $ -
Issuance of common stock for
services $ - $ - $ - $ - $ -
</TABLE>
8
<PAGE>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1998 and December 31, 1997
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Organization
The Company was incorporated on April 12, 1989 in the State of
Nevada. This corporation is considered a development stage
enterprise whose principal business activity will be to seek
potential business ventures and assets which may warrant
involvement or purchase by the Company.
In September 1992, shares of the Company's outstanding common
stock were sold pursuant to an Agreement of Purchase and Sale of
Common Stock. The sale of the shares resulted in a change in the
control of the Company.
The Company is pursuing new business opportunities through merger
or purchase of existing, operating companies.
a. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has selected a calendar year
end.
b. Cash Equivalents
The Company considers all highly liquid investments with a
maturity of three months or less when purchased to be cash
equivalents.
c. Income Taxes
No provision for income taxes has been accrued because the Company
has incurred losses from inception. The Company has elected a
December 31 year end and has a net operating loss carryover of
approximately $195,000 for both books and taxes, which expires in
2013.
d. Loss per Share
The computation of loss per share of common stock is based on the
weighted average number of shares outstanding during the period of
the financial statements.
e. Reverse Stock Split
In November 1992, the Company reverse split its shares of common
stock on a 1-for-5 basis. All references to shares outstanding and
earnings per share have been adjusted to reflect the effect of the
reverse split on a retroactive basis.
9
<PAGE>
COFITRAS ENTERTAINMENT, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1998 and December 31, 1997
NOTE 1 - SIGNIFICANT ACCOUNTING POLICES (Continued)
f. Dividends
The Company has not at the present time, paid any dividends to the
shareholders of its common stock and any dividends that may be
paid in the future will depend upon the financial requirements of
the Company and other relevant factors.
g. Use of 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 and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
h. Unaudited Financial Statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for
a fair presentation. Such adjustments are of a normal recurring
nature.
NOTE 2 - GOING CONCERN
The accompanying financial statement shave been prepared assuming
the Company will continue as a going concern. The Company has been
in the development stage since its inception and does not have a
significant operating history. In order to carry out its operating
plans, the Company will need to obtain additional funding from
outside sources. The Company is pursuing new business
opportunities through merger or purchase of existing, operating
companies. Due to the extremely limited assets and resources of
the Company, no assurance can be given that the Company will be
successful in its pursuit of new business opportunities.
NOTE 3 - RELATED PARTY TRANSACTIONS
During 1993, a shareholder of the Company paid $46,710 for
expenses incurred by the Company. The full amount was treated as
additional paid-in capital at December 31, 1993. During 1995, a
shareholder of the Company paid $35,778 for expenses incurred by
the Company. The full amount was treated as additional paid-in
capital at December 31, 1995.
During 1998, the Company borrowed $5,000 from a related party.
10
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
The following discussion and analysis provides information which
management believes is relevant to an assessment and understanding of the
Company's consolidated results of operations and financial condition. The
discussion should be read in conjunction with the consolidated financial
statements and notes thereto.
Plan of Operation
The Company has no business operations, and very limited assets or
capital resources. The Company's business plan is to seek one or more potential
business ventures that, in the opinion of management, may warrant involvement by
the Company. The Company recognizes that because of its limited financial,
managerial and other resources, the type of suitable potential business ventures
which may be available to it will be extremely limited. The Company's principal
business objective will be to seek long-term growth potential in the business
venture in which it participates rather than to seek immediate, short-term
earnings. In seeking to attain the Company's business objective, it will not
restrict its search to any particular business or industry, but may participate
in business ventures of essentially any kind or nature. It is emphasized that
the business objectives discussed are extremely general and are not intended to
be restrictive upon the discretion of management.
The Company will not restrict its search for any specific kind of
firms, but may participate in a venture in its preliminary or development stage,
may participate in a business that is already in operation or in a business in
various stages of its corporate existence. It is impossible to predict at this
stage the status of any venture in which the Company may participate, in that
the venture may need additional capital, may merely desire to have its shares
publicly traded, or may seek other perceived advantages which the Company may
offer. In some instances, the business endeavors may involve the acquisition of
or merger with a corporation which does not need substantial additional cash but
which desires to establish a public trading market for its common stock.
The Company does not have sufficient funding to meet its cash needs.
The current sole officer and director has expressed her intent to borrow funds
to the extent possible, to fund the costs of operating the Company until a
suitable business venture can be completed. Management does not anticipate
raising funds during the next twelve months. There is no assurance that the
Company will be able to successfully identify and/or negotiate a suitable
potential business venture.
The Company has experienced net losses during the development stage
(April 1989 to present) and has had no significant revenues during such period.
During the past two fiscal years the Company has had no business operations. In
light of these circumstances, the ability of the Company to continue as a going
concern is significantly in doubt. The attached financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
Forward-Looking Statements
When used in this Form 10-Q or other filings by the Company with the
Securities and Exchange Commission, in the Company's press releases or other
public or shareholder communications, or in oral statements made with the
approval of an authorized officer of the Company's executive officers, the words
or phrases "would be", "will allow", "intends to", "will likely result", "are
expected to", "will continue", "is anticipated", "estimate", "project", or
similar expressions are intended to identify "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995.
The Company cautions readers not to place undue reliance on any
forward-looking statements, which speak only as of the date made, and advises
readers that forward-looking statements involve various risks and uncertainties.
The Company does not undertake, and specifically disclaims any obligation to
update any forward-looking statements to reflect occurrences or unanticipated
events or circumstances after the date of such statement.
11
<PAGE>
PART II -- OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to Vote of Securityholders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a)
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
3.1 Articles of Incorporation of the Company (Incorporated by
reference to Exhibit 3.1 of the Company's Form 10-K,
dated December 31, 1997).
3.2 Certificate of Amendment to Articles of Incorporation of
the Company (Incorporated by reference to Exhibit 3.2 of
the Company's Form 10-K, dated December 31, 1997).
3.3 Bylaws of the Company (Incorporated by reference to
Exhibit 3.3 of the Company's Form 10-K, dated December
31, 1997).
27 Financial Data Schedule
(b) Reports on Form 8-K:
None.
12
<PAGE>
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.
COFITRAS ENTERTAINMENT, INC.
(Registrant)
Date: August 12, 1998 By /s/ Christine Green
------------------------------
Christine Green
Chairman, Chief Executive Officer
and Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE SIX MONTH PERIOD ENDED JUNE 30, 1998, AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 3,485
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,485
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,485
<CURRENT-LIABILITIES> 15,616
<BONDS> 0
0
0
<COMMON> 59,041
<OTHER-SE> 71,172
<TOTAL-LIABILITY-AND-EQUITY> 3,485
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> (2,441)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,441)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
