U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Fiscal Year Ended: December 31, 1996
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from To
Commission file number 33-20111
Eat at Joe's Ltd.
(Name of small business issuer in its charter)
Delaware 75-2636283
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
P.O. Box 500, Yonkers, New York 10704
(Address of principal executive offices) (zip code)
Issuer's telephone number (914) 725-2700
Securities registered under Section 12(b) of the Act: NONE Securities
registered under Section 12(g) of the Act:
Common Stock Par Value $0.0001
(Title of class)
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
Total pages: 14
Exhibit Index Page: 12
Check if there is no disclosure of delinquent filers pursuant to Item
405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of
this Form 10-KSB or any amendment to this form 10-KSB. [ ]
State issuer's revenues for its most recent fiscal year. $ -0-
As of March 17, 1997, there were 12,228,805 shares of the Registrant's
common stock, par value $0.0001, issued and outstanding and 1,600,000 warrants
to purchase common stock at $1.00 per share. The aggregate market value of the
Registrant's voting stock held by non-affiliates of the Registrant was
approximately $6,728,805 computed at the average bid and asked price as of
March 17, 1997.
DOCUMENTS INCORPORATED BY REFERENCE
If the following documents are incorporated by reference, briefly
describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II,
etc.) into which the document is incorporated: (1) any annual report to
security holders; (2) any proxy or information statement; and (3) any
prospectus filed pursuant to Rule 424(b) or (c) of the Securities
Act of 1933 ("Securities Act"): NONE
Transitional Small Business Disclosure Format (check one):
Yes ; NO X
TABLE OF CONTENTS
Item Number and Caption Page
PART I
Item 1. Description of Business . . .. . . . . . . . . . . . . . . 4
Item 2. Description of Property . . . . . . . . . . . . . . . . . 5
Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . 5
Item 4. Submission of Matters to a Vote of Security Holders . . . 5
PART II
Item 5. Market for Common Equity and Related Stockholder Matters. . 6
Item 6. Management's Discussion and Analysis or Plan of Operations 6
Item 7. Financial Statements. . . . . . . . . . . . . . . . . . . 8
Item 8. Changes in and Disagreements With Accountants on Accounting
and Financial Disclosure . . . . . . . . . . . . . . . . . 8
PART III
Item 9. Directors, Executive Officers, Promoters and Control
Persons; Compliance with Section 16(a) of the Exchange Act 9
Item 10. Executive Compensation. . . . . . . . . . . . . . . . . . . . 11
Item 11. Security Ownership of Certain Beneficial Owners and Management 11
Item 12. Certain Relationships and Related Transactions. . . . . . . . 12
Item 13. Exhibits and Reports on Form 8-K. . . . . . . . . . . . .. . . 12
PART I
ITEM 1 DESCRIPTION OF BUSINESS
General
The Company is seeking to effect a merger, exchange of capital stock,
asset acquisition or other similar business combination with an operating
business. The business objective of the Company is to effect a business
combination with a business which the Company believes has significant
growth potential. The Company intends to utilize equity in affecting a business
combination. On September 13, 1996 the Company changed its name to Eat at
Joe's Ltd. and on November 11, 1996 raised $60,000 pursuant to Regulation D
under Rule 504. The Company intends to open and operate theme restaurants
styled in an "American Diner" atmosphere where families can eat wholesome,
home-cooked food in a safe friendly atmosphere. Eat at Joe's, the
classic American grill, is a restaurant concept that takes you back to eating
in the era when favorite old rockers were playing on chrome-spangled
jukeboxes and neon signs reflected on shiny tabletops of the 1950's.
History
The company was incorporated as Conceptualistics, Inc. on January 6,
1988 in Delaware as a wholly owned subsidiary of Halter Venture Corporation
("HVC"), a publicly-owned corporation (now known as Debbie Reynolds Hotel and
Casino, Inc.) In 1988, HVC divested itself of approximately 14% of its
holdings in the Company by distributing 1,777,000 shares of the issued
and outstanding stock of the Company to its shareholders. The then majority
shareholder of HVC became the majority shareholder of the Company. Its business
purpose is primarily to seek and acquire or merge with all types of business
ventures. Its authorized capital stock is 50,000,000 shares of common stock,
par value $0.0001 per share and 10,000,000 shares of preferred stock, par
value $0.0001 per share.
During the period from September 30, 1988 to March 1, 1990, the company
remained in the development stage while attempting to enter the mining industry.
The Company acquired certain unpatented mining claims and related equipment
necessary to mine, extract, process and otherwise explore for kaolin clay,
silica, feldspar, precious metals, antimony and other commercial minerals
from its majority stockholder and unrelated third parties. The Company
was unsuccessful in these start up efforts and all activity ceased during
1992 as a result of foreclosure on various loans in default and/or abandonment
of all assets.
Since March 1, 1990, the Company has not engaged in any business
activities and the business purpose of the Company is to seek out and obtain an
acquisition or merger transaction whereby its stockholders would benefit by
owning an interest in a viable enterprise. Since the Company has no operations
or significant assets, its principal potential for profits comes solely
from operations it would receive in any acquisition or merger transaction. A
merger or acquisition transaction with the Company would allow a privately held
company to become a publicly held corporation with a broad shareholder base
without experiencing the substantial time and filing requirements and
financial expenditures imposed by federal and state securities laws.
On January 3, 1997, the Shareholders adopted a plan or reorganization
and merger between the Company and E. A. J. Holding Corp. Inc. ("Hold") to be
effective on or before January 31, 1997. Under the plan, the Company will
acquire all the issued and outstanding shares of "Hold", a Delaware corporation
making "Hold" a wholly owned subsidiary of the Company for 5,500,000 common
shares of the Company.
ITEM 2 DESCRIPTION OF PROPERTY
The Company at this time has no properties.
Since 1992 all activities of the Company have been conducted by
corporate officers from either their home or business offices. Currently,
there are no outstanding debts owed by the Company for the use of these
facilities and there are no commitments for future use of the facilities.
ITEM 3 LEGAL PROCEEDINGS
NONE
ITEM 4 SUBMISSION OF MATTERS TO A
VOTE OF SECURITY HOLDERS
NONE
PART II
ITEM 5 MARKET FOR COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
The stock is traded over-the-counter on the Electronic Bulletin Board
with the trading symbol "JOES". To the best knowledge of management, there was
no trading of shares during the past two years.
The number of shareholders of record of the Company's common stock as of
March 17, 1997 was 377.
The Company has not paid any cash dividends to date and does not
anticipate paying dividends in the foreseeable future. It is the present
intention of management to utilize all available funds for the development of
the Company's business.
ITEM 6 MANAGEMENT'S DISCUSSION AND
ANALYSIS OR PLAN OF OPERATIONS
Plan of Operations - Eat at Joe's Ltd. Intends to open and operate theme
restaurants styled in an "American Diner" atmosphere where families can eat
wholesome, home cooked food in a safe friendly atmosphere. Eat at Joe's, the
classic American grill, is a restaurant concept that takes you back to eating
in the era when favorite old rockers were playing on chrome-spangled
jukeboxes and neon signs reflected on shiny tabletops of the 1950's. Eat at
Joe's fulfills the diner dream with homey ambiance that's affordable while
providing food whose quality and variety is such you can eat there over and
over, meal after meal. To build on the diner experience, a retail
section in each Eat at Joe's would allow customers to take the good feelings
home with them, in the form of 50's memorabilia.
The Company's expansion strategy is to open restaurants either through
Joint Venture agreements or Company owned units. Units may consist of a
combination of full service restaurants or food court locations. Restaurant
construction will take from 90-150 days to complete on a leased site.
In considering site locations, the Company concentrates on trade
demographics, such as traffic volume, accessibility and visibility. High
Visibility Malls and Strip Malls in densely populated suburbs are the
preferred locations. The Company also scrutinizes the potential
competition and the profitability of national restaurant chains in the target
market area. As part of the expansion program, the Company will inspect and
approve each site before approval of any joint venture or partnership.
A typical food court unit is approximately 500 square feet, whereas for
a full service operation it is approximately 3,500 square feet. Food court
operation consists of a limited menu. A full service restaurant consists of
30-35 tables seating about 140- 150 people. The bar area will hold
6-8 tables and seats 30-35 people.
The restaurant industry is an intensely competitive one, where price,
service, location, and food quality are critical factors. The Company has many
established competitors, ranging from similar casual-style chains to local
single unit operations. Some of these competitors have substantially greater
financial resources and may be established or indeed become established in
areas where the Eat at Joe's Company operates. The restaurant industry may
be affected by changes in customer tastes, economic, demographic trends, and
traffic patterns. Factors such as inflation, increased supplies costs and
the availability of suitable employees may adversely affect the restaurant
industry in general and the Eat at Joe's Company Restaurant in particular.
Significant numbers of the Eat at Joe's personnel are paid at rates related
to the federal minimum wage and accordingly, any changes in this would affect
the Company's labor costs.
Results of Operations - From March 1, 1990 to December 12, 1995 the Company
was an inactive corporation. On December 12, 1995 the Company was reactivated
and since that date the Company continued to be a development stage company and
has not begun principal operations.
Liquidity and Capital Resources - The Company intends to seek an acquisition
of a larger and potentially more profitable business. The Company intends to
focus on opportunities to acquire new products or technologies in development as
well as those currently being operated, including a complete operating
business that has demonstrated long-term growth potential, strong
marketing presence, and the basis for continuing profitability. The Company
has not identified any specific target or possible acquisition. As the
Company pursues its acquisition program, it will incur costs for ongoing
general and administrative expenses as well as for identifying,
investigating, and negotiating a possible acquisition.
In order to complete any acquisition or expansion, the Company may be
required to supplement its available cash and other liquid assets with proceeds
from borrowing, the sale of additional securities or other sources. There can
be no assurance that any such required additional funding will be available or,
if available, that it can be obtained on terms favorable to the Company.
Government Regulations - The Company is subject to all pertinent Federal,
State, and Local laws governing its business. Each Eat at Joe's is subject to
licensing and regulation by a number of authorities in its State or
municipality. These may include health, safety, and fire regulations.
The Company's operations are also subject to Federal and State minimum wage
laws governing such matters as working conditions, overtime and tip credits.
ITEM 7 FINANCIAL STATEMENTS
The financial statements of the Company and supplementary data are included
beginning immediately following the signature page to this report. See Item 13
for a list of the financial statements and financial statement schedules
included.
ITEM 8 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
There are not and have not been any disagreements between the Company
and its accountants on any matter of accounting principles, practices or
financial statements disclosure.
PART III
ITEM 9 DIRECTORS EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF
THE EXCHANGE ACT
Executive Officers and Directors
The following table sets forth the name, age, and position of each
executive officer and director of the Company:
Director's Name Age Office Term Expires
Joseph Fiore 36 Chief Executive officer/ Next
Chairman of the Board of Annual
Directors/Secretary Meeting
James Mylock, Jr. 30 Director Next
Annual
Meeting
Andrew Cosenza, Jr. 28 President/Treasurer/ Next
Chief Operating Officer/ Annual
Director Meeting
Joseph Fiore has served as C.E.O./Chairman of the board of directors/
Secretary of the Company since October 5, 1996. A native New Yorker and
graduate with honors from Fordham University, B.S. in Finance, Mr. Fiore began
his career in food service before he graduated from college when he purchased
his first restaurant in the Galleria Mall in White Plains, N.Y. After
graduation, he began working on the development of a 1950's theme restaurant
concept with a traditional American menu of hamburgers, hot dogs, french fries,
and ice cream - Eat at Joe's. Mr. Fiore will be working with the investment
community as well as all administrative activities within the Company.
James Mylock, Jr. has served as a director of the Company since October
5, 1996. Mr. Mylock went to work for Eat at Joe's after graduation from the
State University of New York at Buffalo in 1990 with a B.A. in Sociology and
an A.A.S. in Business Administration. Combining his management skills with
his interest in social trends and marketing, Mr. Mylock took a
management position within a corporate retail unit where he gained a vast
knowledge of the restaurant industry as well as discovering innovative ways to
meet customer needs. He will be responsible for business development and aid
in territorial acquisitions.
Andrew Cosenza, Jr. has served as President/ Treasurer/Chief
Operating Officer and director of the Company from October 5, 1996. Andrew
Cosenza, Jr. is a graduate of Drexel University where he majored in Finance with
a minor in Hotel and Restaurant Management. Mr. Cosenza successfully owned
and operated sit-down restaurants, pizzerias, and free-standing
fast-food outlets. Each of Mr. Cosenza's food outlets are operated as if
they are individually owned. Managers are experienced, mature and motivated to
succeed. Mr. Cosenza brings an enormous amount of hands-on operational
experience to Eat at Joe's as well as corporate expertise.
The Company's Certificate of Incorporation provides that the board of
directors shall consist of from one to nine members as elected by the
shareholders. Each director shall hold office until the next annual meeting
of stockholders and until his successor shall have been elected and
qualified.
Board Meetings and Committees
The Directors and Officers will not receive remuneration from the
Company until a subsequent offering has been successfully completed, or cash
flow from operating permits, all in the discretion of the Board of Directors.
Directors may be paid their expenses, if any, of attendance at such meeting
of the Board of Directors, and may be paid a fixed sum for attendance
at each meeting of the Board of Directors or a stated salary as Director. No
such payment shall preclude any Director from serving the Corporation in any
other capacity and receiving compensation therefor. No compensation has been
paid to the Directors. The Board of Directors may designate from among its
members an executive committee and one or more other committees. No such
committees have been appointed.
Compliance with Section 16(a) of the Exchange Act
Based solely upon a review of forms 3, 4, and 5 and amendments thereto,
furnished to the Company during or respecting its last fiscal year, no director,
officer, beneficial owner of more than 10% of any class of equity securities
of the Company or any other person known to be subject to Section 16 of the
Exchange Act of 1934, as amended, failed to file on a timely basis
reports required by Section 16(a) of the Exchange Act for the last fiscal
year.
ITEM 10 EXECUTIVE COMPENSATION
NONE.
ITEM 11 SECURITY OWNERSHIP OF BENEFICIAL OWNERS
AND MANAGEMENT
Principal Shareholders
The table below sets forth information as to each person owning of
record or who was known by the Company to own beneficially more than 5% of
the 12,228,805 shares of issued and outstanding Common Stock of the Company
as of March 17, 1997 and information as to the ownership of the Company's
Stock by each of its directors and executive officers and by the
directors and executive officers as a group. Except as otherwise indicated,
all shares are owned directly, and the persons named in the table have sole
voting and investment power with respect to shares shown as beneficially
owned by them.
To the best of management's knowledge there is not any shareholder who
owns more than 5% of the Company's common stock.
# of
Name and Address Nature of Shares
of Beneficial Owners Ownership Owned Percent
Directors
Joseph Fiore Common Stock 2,949,934 24%
James Mylock, Jr. Common Stock None -0-
Andrew Cosenza, Jr. Common Stock 2,700,000 22%
All Executive Officers Common Stock 5,649,934 46%
and Directors as a Group
(3 persons)
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
NONE.
ITEM 13. EXHIBITS, AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report.
1. Financial Statements
Page
Report of Robison, Hill & Co., Independent Certified Public
Accountants F-1
Balance Sheets as of December 31, 1996, and 1995 F-2
Statements of Operations for the years ended
December 31, 1996, and 1995 F-3
Statement of Stockholders' Equity for the years ended
December 31, 1996, and 1995 F-4
Statements of Cash Flows for the years ended
December 31, 1996, and 1995 F-5
Notes to Financial Statements F-7
2. Financial Statement Schedules
The following financial statement schedules required by Regulation S-X
are included herein.
All schedules are omitted because they are not applicable or the
required information is shown in the financial statements or notes thereto.
3. Exhibits
The following exhibits are included as part of this report:
Exhibit
Number Title of Document
3.01 Articles of Incorporation of Conceptualistics,
Incorporated Inc. a Utah Corporation now known as
Eat At Joe's, LTD. (1)
3.02 Bylaws (1)
10.23 Consent of Accountants
(b) No reports on Form 8-K were filed.
(c) The exhibits listed in Item 14(a)(3) are incorporated by
reference.
(d) No financial statement schedules required by this paragraph are
required to be filed as a part of this form.
SIGNATURES
Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on it behalf by the undersigned, thereunto duly authorized.
EAT JOE'S LTD.
Dated: March 31, 1997 By /S/ Joseph Fiore
Joseph Fiore,
C.E.O./Chairmam/Secretary/Director
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated on this 31st day of March 1997.
Signatures Title
/S/ Joseph Fiore
Joseph Fiore C.E.O./Chairman/Secretary/Diretor
(Principal Executive, Financial
and Accounting Officer)
/S/ James Mylock, Jr.
James Mylock, Jr. Director
/S/ Andrew Cosenza, Jr.
Andew Cosenza, Jr. Director/President/C.O.O./Treasurer
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors and Stockholders
Eat At Joe's Ltd.
We have audited the accompanying balance sheets of Eat At Joe's Ltd.. (a
Delaware corporation and a development stage enterprise) as of December 31,
1996, and 1995 and the related statements of operations, changes in
stockholders' equity and cash flows for the years then ended. 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 Eat At Joe's Ltd.
(a development stage enterprise) as of December 31, 1996, and 1995, and the
results of its operations and its cash flows for the years then ended, in
conformity with generally accepted accounting principles.
Respectfully submitted,
/S/
Robison, Hill & Co.
Certified Public Accountants
Salt Lake City, Utah
March 17, 1997
EAT AT JOE'S LTD.
(a development stage enterprise)
BALANCE SHEETS
DECEMBER 31, 1996 AND 1995
1996 1995
ASSETS
Current Assets:
Cash and Cash Equivalents $ 34,972 $ -
Prepaid Expense 3,975 -
Deposits 25,000 -
Total Current Assets 63,947 -
LIABILITIES
Current Liabilities:
Accounts Payable 7,235 -
STOCKHOLDERS' EQUITY
Preferred stock - $0.0001 par
value. 10,000,000 shares
authorized; none issued and
outstanding - -
Common stock - $0.0001 par value.
50,000,000 shares authorized.
6,328,428 and 313,973, issued and
outstanding, respectively. 633 31
Additional paid-in capital 452,243 382,845
Contributed capital 672,659 672,659
Deficit accumulated during the
development stage (1,068,823) (1,055,535)
Total Stockholders' Equity 56,712 -
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 63,947 $ -
The accompanying notes are an integral part of these financial statements.
EAT AT JOE'S LTD.
(a development stage enterprise)
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1996, AND 1995
Cumulative
During
Development
1996 1995 Stage
Revenues $ - $ - $ -
Expenses
General and administrative 9,350 - 9,350
Amortization of
organization cost - - 6,244
Net loss from continuing operations (9,350) - (15,594)
Other Income (Expense)
Interest income - - 16,851
Interest expense (3,938) - (3,938)
Net loss before discontinued
operations and income taxes (13,288) - (2,681)
Discontinued Operations
Loss from mining operations - - (497,812)
Loss from foreclosure on
and abandonment of assets
and related liabilities - - (568,330)
Total Effect of
Discontinued
Operations - - (1,066,142)
Net loss before income taxes (13,288) - (1,068,823)
Income Tax Expense (benefit) - - -
Net Loss $(13,288) $ - $(1,068,823)
Net loss per weighted-average
share of common stock
outstanding (.01) -
Weighted-average number of
shares of common stock
outstanding 1,030,247 313,973
The accompanying notes are an integral part of these financial
statements.
<PAGE> EAT AT JOE'S LTD.
(a development stage company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1996, AND 1995
Deficit
Accumulated
Additional During the
Common Stock Paid-in Contributed Development
Shares Amount Capital Capital Stage Total
Balances at
December 31,
1994 313,973 31 382,845 672,659 (1,055,535) -
Net loss
for the year - - - - - -
Balances at
December 31,
1995 313,973 31 382,845 672,659 (1,055,535) -
May 1996,
shares issued
to Company
for cash 14,455 2 9,998 - - 10,000
November 1996,
shares issued
in Reg D-504
offering 6,000,000 600 59,400 - - 60,000
Net loss
for the year - - - - (13,288) (13,288)
Balances at
December 31,
1996 6,328,428 $ 633 $ 452,243 $ 672,659 $(1,068,823) $ 56,712
The accompanying notes are an integral part of these financial
statements.
EAT AT JOE'S LTD.
(a development stage company)
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1996, AND 1995
Cumulative
During
Development
1996 1995 Stage
Cash Flows From Operating
Activities
Net loss for the period $ (13,288) $ - $(1,068,823)
Adjustments to reconcile
net loss to net cash
provided by operating
activities
Loss from foreclosure and
abandonment of assets
and related liabilities - - 568,330
Depreciation - - 111,181
Payment of organization
costs - - (6,244)
Amortization of
organization costs - - 6,244
Increase in prepaid expense (3,975) - (3,975)
Increase in deposits (25,000) - (25,000)
Increase in accounts payable 7,235 - 7,235
Decrease in accrued
interest payable - - 8,707
Contributed capital for
operating costs - - 350
Net Cash Used in Operating
Activities (35,028) - (401,995)
Cash Flows From Investing
Activities
Principal collected on
notes receivable - - 199,727
Purchase of property and
equipment - - (65,661)
Proceeds from sale of
property and equipment - - 18,369
Net Cash Provided by Investing
Activities - - 152,435
EAT AT JOE'S LTD.
(a development stage company)
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1996, AND 1995
Cumulative
During
Development
1996 1995 Stage
Cash Flows From Financing
Activities
Issuance of common stock $ 70,000 $ - $ 326,676
Payments on long-term debt - - (36,307)
Advances to (from) majority
stockholder - - (5,837)
Net Cash Provided by Financing
Activities 70,000 - 284,532
Increase in Cash 34,972 - 34,972
Cash at beginning of period - - -
Cash at end of period $ 34,972 $ - $ 34,972
Supplemental Disclosure of
Interest and Income Taxes
Paid
Interest paid for the
period $ 3,938 $ - $ 27,485
Income taxes paid for the
period $ - $ - $ -
Supplemental Disclosure of
Non-cash Investing and
Financing Activities
Contribution of assets and
assumption of liabilities,
net, from majority
stockholder $ - $ - $ 672,659
Mining equipment acquired
with issuance of common
stock $ - $ - $ 251,200
The accompanying notes are an integral part of these financial statements.
EAT AT JOE'S LTD.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, AND 1995
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of accounting policies for Eat At Joe's, Ltd. is presented
to assist in understanding the Company's financial statements. The accounting
policies conform to generally accepted accounting principles and have been
consistently applied in the preparation of the financial statements.
Organization and Basis of Presentation
Eat At Joe's Ltd. (Company) was incorporated on January 6, 1988, under
the laws of the State of Delaware, as a wholly-owned subsidiary of Debbie
Reynolds Hotel and Casino, Inc. (DRHC) (formerly Halter Venture Corporation
or Halter Racing Stables, Inc.) a publicly-owned corporation. DRHC caused the
Company to register 1,777,000 shares of its initial 12,450,000 issued
and outstanding shares of common stock with the Securities and Exchange
Commission on Form S-18. DRHC then distributed the registered shares to DRHC
stockholders.
During the period September 30, 1988 to December 31, 1992, the
Company remained in the development stage while attempting to enter the mining
industry. The Company acquired certain unpatented mining claims and related
equipment necessary to mine, extract, process and otherwise explore for
kaolin clay, silica, feldspar, precious metals, antimony and other
commercial minerals from its majority stockholder and other unrelated
third-parties. The Company was unsuccessful in these start-up efforts and
all activity was ceased during 1992 as a result of foreclosure on various
loans in default and/or the abandonment of all assets.
Since December 31, 1992, the Company has had no operations,
assets or liabilities. The current business purpose of the Company is to
seek out and obtain a merger, acquisition or outright sale transaction
whereby the Company's stockholders will benefit. Subsequent to December 31,
1996 the Company and E. A. J. Holding Corp. Inc. entered into an agreement of
acquisition (see subsequent events footnote).
The Company is considered in the development stage and has not
commenced planned principal operations.
Nature of Business
The Company intends to acquire interests in various business
opportunities, which in the opinion of management will provide a profit to the
Company.
EAT AT JOE'S LTD.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, AND 1995
(Continued)
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Reverse Stock Split
Effective May 3, 1996 the Stockholders approved a 50 to 1 reverse split
of the common stock and effective October 7, 1996 the Stockholders approved
a 4 to 1 reverse split. The financial statements have been retroactively
restated to reflect the reverse stock split as if it had been effective
prior to the earliest date presented.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with a maturity of three months or
less to be cash equivalents to the extent the funds are not being held for
investment purposes.
Organization costs
Organization costs were amortized using the straight-line basis.
Loss per share
Loss per share is computed by dividing the net loss by the
weighted-average number of common shares outstanding during the year.
Fully diluted earnings per share amounts are not presented because they
are anti-dilutive.
Reclassifications
Certain reclassifications have been made in the 1995 financial
statements to conform with the 1996 presentation.
NOTE 2 - INCOME TAXES
As of December 31, 1996, the Company had a net operating loss
carryforward for income tax reporting purposes of approximately $1,005,000.
Current tax laws limit the amount of loss available to be offset against
future taxable income when a substantial change in ownership occurs.
Therefore, the amount available to offset future taxable income may be
limited.
EAT AT JOE'S LTD.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, AND 1995
(Continued)
NOTE 3 - DEVELOPMENT STAGE
The Company has not begun principal operations and as is common with a
development stage company, the Company has had recurring losses during its
development stage.
NOTE 4 - COMMITMENTS
As of December 31, 1996 all activities of the Company have been
conducted by corporate officers from either their homes or business offices.
Currently, there are no outstanding debts owed by the company for the use of
these facilities and there are no commitments for future use of the
facilities.
NOTE 4 - SUBSEQUENT EVENTS
On January 3, 1997, the Shareholders adopted a plan or reorganization
and merger between the Company and E. A. J. Holding Corp. Inc. ("Hold") to
be effective on or before January 31, 1997. Under the plan, the Company will
acquire all the issued and outstanding shares of "Hold", a Delaware
corporation making "Hold" a wholly owned subsidiary of the Company
for 5,500,000 common shares of the Company.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FROM THE
BALANCE SHEET OF EAT AT JOE'S LTD. AS OF DECEMBER 31, 1996
AND THE RELATED STATEMENTS OF OPERATIONS, EQUITY AND CASHFLOWS FOR
THE YEAR THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERRENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 35
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 64
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 64
<CURRENT-LIABILITIES> 7
<BONDS> 0
0
0
<COMMON> 1
<OTHER-SE> 56
<TOTAL-LIABILITY-AND-EQUITY> 64
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 9
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4
<INCOME-PRETAX> (13)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> 0
</TABLE>
EXHIBIT 10.23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
WE HEREBY CONSENT TO THE INCLUSION IN THIS fORM 10-KSB OF OUR REPORT DATED
MARCH 17, 1997 ON OUR AUDIT OF THE FINANCIAL STATEMENTS OF EAT AT JOE'S LTD.
/S/
ROBISON, HILL & CO.
CERTIFIED PUBLIC ACCOUNTANTS
SALT LAKE CITY, UTAH
MARCH 31, 1997
