SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended March 31, 2000 Commission File No. 0-15148
NEWBRIDGE CAPITAL, INC.
(Formerly Scientific NRG, Incorporated)
(Exact name of registrant as specified in its charter)
Nevada 33-0877143
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
4695 MacArthur Court, Suite 530, Newport Beach, CA 92660
(Address of principal executive offices) (Zip Code)
(949) 833-2094
(Registrant's telephone number, including area code)
Scientific NRG, Incorporated
(Former Name, if Changed Since Last Report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for 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 CORPORATE ISSUERS:
As of April 30, 2000, there were 3,202,390 shares of the Registrant's no
par value common stock issued and outstanding.
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
INDEX
Page
PART I
Item 1. Financial Statements
Balance Sheet - March 31, 2000.................................... 1
Statements of Operations - Nine Months and
Three Months Ended March 31, 2000 and 1999..................... 2
Statements of Cash Flows - Nine Months Ended
March 31, 2000 and 1999........................................ 3
Notes to Financial Statements..................................... 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations..................... 7
PART II
Item 1. Legal Proceedings................................................. 8
Item 2. Changes In Securities............................................. 8
Item 3. Defaults Upon Senior Securities................................... 8
Item 4. Submission of Matters to a Vote of Security Holders............... 8
Item 5. Other Information................................................. 8
Item 6. Exhibits and Reports on Form 8-K.................................. 8
Signatures........................................................ 9
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
Balance Sheet
As of March 31, 2000 (Unaudited)
ASSETS
<TABLE>
<CAPTION>
<S> <C>
Current assets:
Cash $ 1,374,054
Receivables from affiliates 270,296
Other current assets 800
Total current assets 1,645,150
Investments, at cost 1,073,762
Equity Investment in Convertible
Preferred Stock, at cost 8,000,000
Property and equipment, net 31,363
$ 10,750,275
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 113,080
Income taxes payable 164,767
Total current liabilities 277,847
Commitments and contingencies
Stockholders' equity:
Common stock, $.001 par value; 75,000,000
shares authorized; 3,202,290 shares
issued and outstanding 3,202
Preferred stock, $.001 par value; 25,000,000
shares authorized; none issued and outstanding -
Additional paid-in capital 14,107,216
Accumulated deficit (3,637,990)
Total stockholders' equity 10,472,428
$ 10,750,275
</TABLE>
See accompanying notes to these financial statements
1
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
Statements of Operations
For the Nine Months and Three Months Ended
March 31, 2000 and 1999
<TABLE>
<CAPTION>
For the Three Months For the Nine Months
Ended March 31, Ended March 31,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net Sales $ - $ - $ - $ -
Cost of Sales - - - -
Gross Profit - - - -
Selling, general and administrative
expenses 150,978 34,363 330,971 136,586
Total operating expenses 150,978 34,363 330,971 136,586
Other (income):
Gain of sale of marketable securities - - (868,003) -
Interest Income (9,082) - (12,192) -
Total other (income) (9,082) - (880,195) -
Income (loss) before income taxes (141,896) (34,363) 549,224 136,586
Income tax provision (42,569) 200 164,767 600
Income (loss) from continuing
operations (99,327) (34,563) 384,457 (135,986)
Income from discontinued operations - 38,636 - 143,173
Net income (loss) $ (99,327) $ 4,073 $ 384,457 $ 7,187
Basic and diluted income (loss) per
share:
Income (loss) from continuing
operations $ (.03) $ (.06) $ .11 $ (.24)
Income (loss) from discontinued
operations - .07 .11 .25
Net income (loss) $ (.03) $ .01 $ .11 $ .01
Weighted common shares outstanding 3,202,390 558,676 3,202,390 558,616
</TABLE>
See accompanying notes to these financial statements
2
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
Statements of Cash Flows
For the Nine Months Ended March 31, 2000 and 1999 (Unaudited)
<TABLE>
<CAPTION>
Nine Months
Ended March 31,
<S> <C> <C>
2000 1999
------------- --------------
Cash flows from operating activities:
Net Income (loss) $ 384,457 $ 7,187
Adjustments to reconcile net loss to net cash
Provided by operating activities:
Gain on sale of marketable securities (868,003) -
Depreciation - 1,300
Common stock issued for services rendered 18,000 95,299
Changes in operating assets and liabilities:
(Increase) in inventories - (12,800)
(Increase) decrease in other assets 27,801 (4,423)
Increase (decrease) in accounts payable and
accrued expenses 204,553 (84,507)
Increase (decrease) in other liabilities (27,788) -
Net cash provided by (used in) operating activities (260,980) (2,056)
Cash flows from investing activities:
Proceeds from the sale of marketable securities 1,296,060 -
Investment in Atlantic Pacific (90,589) -
Payments and exchange of Notes Receivable 420,904 -
Net cash provided by investing activities 1,633,375 -
Net increase (decrease) in cash 1,372,395 2,056
Cash at beginning of period 1,659 14,367
Cash at end of period $ 1,374,054 $ 16,423
</TABLE>
See accompanying notes to these financial statements
3
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS
March 31, 2000 (Unaudited)
1. ORGANIZATION AND HISTORY
Business and Organization
NewBridge Capital, Inc. (the "Company") was incorporated in the state of
Minnesota in 1983 under the name of Scientific NRG, Incorporated Company
historically designed, manufactured and marketed custom energy efficient
lighting products utilizing compact fluorescent lamp technology primarily within
the United States. The principal products were energy efficient, compact
fluorescent downlight fixtures primarily for the downlight canister retrofit
market.
On August 15, 1998, the Company's Board of Directors approved the sale of the
Company's downlight business, which constitutes substantially all of the
Company's assets and operations. On June 29, 1999, the Company completed the
sale of its downlight business which included substantially all of the Company's
assets and operations.
Effective June 30, 1999, the Company consummated an asset purchase agreement
with NuVen Capital L.P. ("NuVen"), which resulted in the Company acquiring
certain assets of NuVen, in exchange for 2,234,466 shares of the Company's
common stock valued at $10,090,793, based the estimated fair value of the
underlying assets acquired. No liabilities were assumed in this transaction. The
assets obtained by the Company consisted of Series D Convertible Preferred Stock
of NuOasis Resorts, Inc. ("NuOasis") totaling $8,000,000; certain receivables,
primarily from affiliates, with a net carrying value of $403,200; marketable
securities in affiliates totaling $1,136,556; and other non-current assets
totaling $551,037. As a result of this transaction, NuVen obtained approximately
70% control of the Company. The assets acquired were accounted for at historical
basis similar to a recapitalization.
In January 1999, the Company re-incorporated through a merger with a newly
formed entity, NewBridge Capital, Inc., a Nevada corporation, thus effecting a
change in the corporate name and corporate domicile. As part of the merger, each
shareholder received one share of NewBridge Capital, Inc. common stock for every
ten shares of Scientific NRG, Incorporated common stock. Fractional shares were
paid as a whole share. All common stock has been restated to reflect the
exchange of shares.
The Company had no operations during the nine months ended March 31, 2000.
However, effective April 1, 2000 NuVen assigned to the Company all of its rights
and responsibilities pursuant to advisory agreements with various publicly held
and privately held entities. The Company will assume and perform certain
advisory services pursuant to the subject advisory agreements and, when
desirable make investments in some or all of the entities under management.
4
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS (Continued)
March 31, 2000
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Going Concern
At March 31, 2000, the Company's operation consisted of managing certain
investments and seeking business opportunities. The Company's plan is to
liquidate or exchange its interests to acquire interests in other ventures and
new opportunities. Effective April 1, 2000, the Company will assume certain
advisory agreements from NuVen Advisors, Inc and will perform advisory services
pursuant to such agreements. Management believes that its working capital is
sufficient to meet its working capital requirements for a period of 12 months
from the balance sheet date.
Use of Estimates
The preparation of the 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 liabilities at the date of the financial statements and
the reported amounts of expenses during the reporting period. Actual results
could differ from those estimates.
Impairment of Long-Lived Assets
Management evaluates its assets for impairment quarterly. No impairment of its
assets was determined by management during the during the nine months ended
March 31, 2000.
Earnings (Loss) Per Common Share
Net income (loss) per common share is calculated by dividing net income (loss)
by the weighted average number of shares outstanding during the period. Common
stock equivalents had no effect on earnings per share.
Issuance of Common Stock for Services
On July 14, 1999, the Company issued 30,000 shares of common stock in connection
with a retainer agreement for legal services. The retainer agreement commenced
on July 1, 1999 and expires on June 30, 2000. Such shares were registered by
management of the Company with the Securities and Exchange Commission on a Form
S-8 registration statement.
Unaudited Interim Financial Statements
The interim financial data as of March 31, 2000, and for the three months
and nine months ended March 31, 2000 and 1999, is unaudited; however, in the
opinion of management, the interim data includes all adjustments, consisting
only of normal recurring adjustments, necessary to present fairly the Company's
financial position as of March 31, 2000, and the results of its operations and
cash flows for the three months and nine months ended March 31, 2000 and 1999.
These financial statements and notes thereto do not reflect all disclosures
necessary for preparation under generally accepted accounting principles. Refer
to the Company's Annual Report Form 10-KSB for the year ended June 30, 1999.
5
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS (Continued)
March 31, 2000
3. MARKETABLE SECURITIES
In connection with the asset purchase agreement with NuVen, the Company obtained
shares of common stock in affiliated companies of NuVen. Each investment
represented less than 10% of the outstanding common stock of the investee and
each security was nationally quoted on the OTC: Bulletin Board of the National
Association of Securities Dealers. As such, each investment was accounted for in
accordance with the provisions of SFAS No. 115.
As of March 31, 2000, the Company sold all of the marketable securities obtained
in the assets purchase agreement with NuVen, for cash and recognized a gain on
sale of marketable securities in the amount of $868,000.
4. RECEIVABLES FROM AFFILIATES
Receivables from affiliates represent non-interest bearing amounts in the amount
of $145,296 from certain affiliated companies.
5. INVESTMENTS AT COST
In connection with the asset purchase agreement, the Company acquired certain
investments in affiliated companies. Included in these investments is an
investment to the clothing trademark "Yes" license. In accordance with generally
accepted accounting principles, the acquisition of the "Yes" license was
recorded at predecessor basis of $389,481. The Company also has an interest in
3.5 million shares of common stock of Yes Clothing Co., a publicly-held
California corporation ("YSCO"), valued at approximately $0.03 per share, for a
total investment at fair market value of $91,382. In February 2000, the Company
also acquired 1,277,005 shares of Preferred Stock of YSCO for $125,000. The
Company intends to carry these investments at cost due to the relatively
immaterial amount of the investment.
Included in investments at cost are investments in the common stock of Hart and
Diversified. The Company acquired 750,000 and 474,085 shares of common stock of
Hart and Diversified, respectively in connection with the NuVen asset purchase
agreement. Currently, there is no market for these shares and thus, the fair
market price per share is not readily determinable. As such, these investments
are recorded in the accompanying financial statements as of December 31, 1999 at
predecessor basis of $7,500 and $31,311 for Hart and Diversified, respectively.
In September 1999, the Company entered into an Exchange Agreement with Phileo
Management Company Inc., a publicly-held Nevada corporation ("Phileo"). Pursuant
to the agreement with Phileo, the Company exchanged the uncollected portion of
certain receivables from affiliates (described in Note 1) for a fully secured
but defaulted note receivable from an unrelated third party in the face amount
of $500,000. In October, 1999 the Company entered into
6
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1999
an Exchange Agreement with Xplorer, S.A., a publicly-held Nevada corporation
("XPLA") to exchange the subject note receivable for 1,274,960 membership units
of Atlantic Pacific Trust, LLC., owned by XPLA. Currently, there is no market
for the APT units and, accordingly the fair market price per APT unit is not
readily determinable. In result, the APT investment is recorded in the
accompanying financial statements at March 31, 2000, at the net basis of the
notes receivable exchanged for this investment of $90,589.
6. INVESTMENT IN NuOASIS RESORTS, INC.
On June 30, 1999 in connection with the Asset Purchase Agreement with NuVen, the
Company acquired 19,200,000 shares of NuOasis Series D voting convertible
Preferred Stock (the "NuOasis D Preferred"), which has a carrying value of
$8,000,000. The Company obtained an independent appraisal of the NuOasis D
Preferred at a fair market value of approximately $10.9 million. Since the
Company is required to record the asset using the predecessor's basis, the
Company recorded the investment at $8,000,000.
In accordance with generally accepted accounting principles, the NuOasis D
Preferred is accounted for under the cost method, since the Company does not
share in the earnings and losses of NuOasis since participation in earnings and
losses is based on the shares of common stock held by a shareholder without
recognition of the type of securities of the investee which are designated as
common stock equivalents.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Going Concern
The Company has experienced recurring net losses and management's intent is to
continue searching for additional business opportunities. Effective April 1,
2000, the Company will assume certain advisory agreements from NuVen Advisors,
Inc and will perform advisory services pursuant to such agreements. The Company
intends to continue utilizing its asset base as a source of operating capital
while continuing to operate with minimal overhead and key administrative
functions provided by consultants who are compensated in the form of the
Company's common stock. Accordingly, the accompanying financial statements have
been presented under the assumption the Company will continue as a going
concern.
Results of Operations
Nine Months Ended March 31,2000 Compared to Nine Months Ended March 31, 1999
There were no operations during the nine months ended March 31, 2000 and as
such, there were no revenues or cost of revenues recorded during the current
nine months. In the nine months ended March 31, 1999, the Company was operating
at minimum levels and the decision was made during this period by the Board of
Directors to aggressively seek other opportunities.
General and administrative expenses was $330,971 in the current nine months
compared to $136,586 in the comparable period last year. The change is
attributable to continued services provided by professional consultants and
other advisors in seeking new business opportunities.
7
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1999
Quarter Ended March 31, 2000 Compared to Quarter Ended March 31, 1999
General and administrative expenses was $150,978 in the current quarter compared
to $34,363 in the comparable period last year. The change is attributable to
continued services provided by professional consultants and other advisors in
seeking new business opportunities.
Liquidity and Capital Resources
As of March 31, 2000, the Company had working capital of $1,520,000 an increase
of $103,000 from June 30, 1999.
The Company had cash balances of approximately $1,374,000 and $14,000 at March
31, 2000 and 1999, respectively. The increase in cash balance in 2000 is a
direct result of the Company selling certain marketable securities and
collecting the amounts due from the acquired receivables.
The Company's plan is to keep searching for additional sources of capital and
new operating opportunities. In the interim, the Company will utilize its asset
base as a source of funds to sustain operations.
8
<PAGE>
NEWBRIDGE CAPITAL, INC.
(Formerly SCIENTIFIC NRG, INCORPORATED)
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1999
PART II: OTHER INFORMATION
Item 1. Legal Proceedings
There have been no changes since the Company's last report in Item 3,
"Legal Proceedings", of Form 10-KSB.
Item 2. Changes In Securities
In January 1999, Scientific NRG Incorporated, the Minnesota
corporation reincorporated by way of a merger with a newly formed
entity, NewBridge Capital, Inc., a Nevada corporation, and effected a
change in the corporate name and corporate domicile. As part of the
merger, each shareholder received one share of NewBridge Capital,
Inc. common stock for every ten shares of Scientific NRG,
Incorporated common stock. Fractional shares were paid as a whole
share. All common stock has been restated to reflect the exchange of
shares.
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
Item 6. Exhibits And Reports On Form 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) Form 8-K - None
9
<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.
NewBridge Capital, Inc.
(Formerly SCIENTIFIC NRG, INCORPORATED)
(Registrant)
Date: May 12, 2000 By:/s/ FRED G. LUKE
Fred G. Luke,
President
By:/s/ Leonard J. Roman
Leonard J. Roman
Chief Financial Officer
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 1,374,054
<SECURITIES> 0
<RECEIVABLES> 145,296
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,520,150
<PP&E> 31,363
<DEPRECIATION> 0
<TOTAL-ASSETS> 10,750,275
<CURRENT-LIABILITIES> 277,847
<BONDS> 0
0
0
<COMMON> 3,202
<OTHER-SE> 10,469,226
<TOTAL-LIABILITY-AND-EQUITY> 10,472,428
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 330,971
<OTHER-EXPENSES> (880,195)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 549,224
<INCOME-TAX> 164,767
<INCOME-CONTINUING> 384,457
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 384,457
<EPS-BASIC> 0.11
<EPS-DILUTED> 0.11
</TABLE>
