UNITED STATES
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, 1998 Commission File Number 0-15992
OTC AMERICA, INC.
(Exact name of registrant as specified in its charter)
COLORADO 84-1031311
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1582 South Parker Road, Suite 203 Denver, Colorado 80231
(Address of principal executive offices) (Zip code)
(303) 750-3111
(Registrant's telephone number, including area code)
Suite 400, 1780 S. Bellaire Street, Denver, CO 80222
(Former name, former address and former fiscal year, if changed since
last report.)
Indicate by check 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 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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common stock, $.0001 par value 48,489,294
Class Number of shares outstanding at July 31, 1998
This document is comprised of 9 pages.
FORM 10-QSB
3RD QUARTER
INDEX
Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements *
Condensed balance sheet as of
March 31, 1998 (Unaudited) 3
Condensed statements of operations -
Three and nine months ended
March 31, 1998 and 1997 (Unaudited) 4
Condensed statements of cash flows -
Nine months ended March 31, 1998
and 1997 (Unaudited) 5
Notes to condensed financial statements
(Unaudited) 6
Item 2. Plan of operation 7
PART II - OTHER INFORMATION 8
Item 1. Legal Proceedings
Item 2. Changes In Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters To A Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures 9
* The accompanying financial statements are not covered by an independent
Certified Public Accountant's report.
Part I. Item 1. Financial information
OTC AMERICA, INC.
Condensed Balance Sheet
March 31, 1998
<TABLE>
<CAPTION>
ASSETS
<S> <C>
TOTAL ASSETS $ -
=================
LIABILITIES AND SHAREHOLDERS' DEFICIT
LIABILITIES
Accounts payable, related party $13,777
_______________
TOTAL LIABILITIES 13,777
______________
SHAREHOLDERS' EQUITY
Common stock 4,849
Additional paid-in capital 481,946
Retained deficit (500,572)
_______________
TOTAL SHAREHOLDERS' DEFICIT $(13,777)
_______________
$ -
===============
</TABLE>
See accompanying notes to condensed financial statements
OTC AMERICA, INC.
<TABLE>
<CAPTION>
Condensed Statements of Operations
Three months ended Nine months ended
March 31 March 31
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Revenue $ - $ - $ - $ -
Costs and Expenses $6,935 $4,504 $8,259 $4,504
Income Taxes $ - $ - $ - $ -
________ _________ _________ _________
Net Income (Loss) $(6,935) $(4,504) $(8,259) $(4,504)
========= ========== ========== =========
</TABLE>
See accompanying notes to condensed financial statements
OTC AMERICA, INC.
<TABLE>
<CAPTION>
Condensed Statements of Cash Flows
Nine Months Ended
March 31,
1998 1997
<S> <C> <C>
NET CASH (USED IN)OPERATING ACTIVITIES $ - $ -
NET CASH PROVIDED BY INVESTING ACTIVITIES $ - $ -
NET CASH PROVIDED BY FINANCING ACTIVITIES $ - $ -
___________ __________
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS $ - $ -
Cash and cash equivalents,
beginning of year $ - $ -
__________ __________
CASH AND CASH EQUIVALENTS, END OF YEAR $ - $ -
========== ==========
</TABLE>
See accompanying notes to condensed financial statements
OTC AMERICA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
March 31, 1998
Note A: Basis of presentation
The financial statements presented herein have been prepared by the Company
in accordance with the accounting policies in its annual 10-KSB report dated
June 30, 1997 and should be read in conjunction with the notes thereto.
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) which are necessary to provide a fair presentation of
operating results for the interim period presented have been made. The
results of operations for the periods presented are not necessarily
indicative of the results to be expected for the year.
Interim financial data presented herein are unaudited.
Note B: Income taxes
The Company records its income taxes in accordance with Statement of
Financial Accounting Standard No. 109, "Accounting for Income Taxes". The
benefit from the net operating losses for the periods ended March 31, 1998
and 1997 has been offset by the establishing of a valuation allowance equal
to the deferred tax asset derived from net operation losses. The valuation
allowance offsets the net deferred tax asset for which there is no assurance
of recovery.
Note C: Sale of Former Officers' Common Stock
On June 11, 1997, the Company's sole officer and director, L. Thomas Tarantelli
("Tarantelli"), entered into an agreement ("option contract") with Downeast
SonRise, Inc. ("Downeast"), giving Downeast the option to purchase Mr.
Tarantelli's 6,705,137 shares of the registrant's common stock. On September
26, 1997 Downeast sold the option contract to Wathne Pierce & Associates,
Inc. ("Wathne"), for $1. Once obtaining the option contract from Downeast,
Wathne sold the option contract to Mr. Randy Phillips for $100,000. On
October 31, 1997 Tarantelli appointed Phillips as a director and Chief
Executive Officer of the Company and resigned as a director and officer. On
November 11, 1997 Mr. Phillips acquired the 6,705,137 shares, representing
13.8% of the Registrants's outstanding common stock, from Mr. Tarantelli for
$50,000. As of October 31, 1997, Mr. Phillips is the sole director and
officer of the registrant.
Note D: Related Party Transactions
During the nine months ended March 31, 1998, the president of the Company
paid on behalf of the Company certain legal, accounting and transfer agent
fees. The total incurred and paid by the officer was $6,459. Additionally,
the president provided office space and general and administrative services
to the Company beginning January 1, 1998 for $600 per month for a total of
$1,800. These amounts are shown on the balance sheet as, accounts payable
related party. The remaining $5,518 are amounts due to the president for
expenses paid on behalf of the Company during the nine months ended March 31,
1997.
Part I. Item 2. Plan of operation
OTC AMERICA, INC.
PLAN OF OPERATION
The plan of the Company's management, for the next twelve months, is to focus
on acquiring an operating entity. The sole officer and director has been
seeking possible merger candidates and expects to consummate a transaction in
the near future. Management anticipates utilizing additional equity financing
and short-term working capital advances in its acquisition endeavors.
RESULTS OF OPERATIONS
No operations were conducted during the most recent quarter. Since February
1989, the Company has been an inactive shell company. Any expenses incurred
since 1989 have been related to legal, accounting and stock transfer agent
fees in order to provide stock transfer services to current shareholders and
to comply with reporting as required by the Securities Exchange Act of 1934.
FINANCIAL CONDITION
As of March 31, 1998 the Company had $13,777 of current liabilities related
to accounting and stock transfer agent fees, of which all of these fees have
been subsequently paid on behalf of the Company and due to the sole officer
and director.
PART II - OTHER INFORMATION
Items 1 Through 5 - No response required.
Item 6 - Exhibits and reports on Form 8-K.
(a) Exhibits
27* Financial Data Schedule.
(b) Reports on Form 8-K were filed on:
November 11, 1997
SIGNATURES
The financial information furnished herein has not been audited by an
independent accountant; however, in the opinion of management, all
adjustments (only consisting of normal recurring accruals) necessary for a
fair presentation of the results of operations for the nine months ended
March 31, 1998 have been included.
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
OTC AMERICA, INC.
(Registrant)
/s/ Randy Phillips
DATE: August 21, 1998 BY: ________________
Randy Phillips, President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM OTC AMERICA,
INC. UNAUDITED BALANCE SHEET AS OF MARCH 31, 1998 AND THE RELATED STATEMENT OF
INCOME FOR THE NINE MONTHS THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENT
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> MAR-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 13,777
<BONDS> 0
0
0
<COMMON> 4,849
<OTHER-SE> (18,626)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 6,935
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,935)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
