UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________ to __________
Commission File No. 33-55254-12
XEBEC GALLEON, INC.
(Exact name of Registrant as specified in its charter)
NEVADA 87-0438447
(State or other jurisdiction of (I.R.S. Employer
inGALLEON, INC. or organization) Identification Number)
1800 EAST SAHARA, SUITE 107
LAS VEGAS, NEVADA 84104
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (801) 485-7775
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 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. [X] Yes [ ] No
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
Class Outstanding as of October, 1996
- - ------------------------------------ -------------------------------
$.001 PAR VALUE CLASS A COMMON STOCK 1,200,000 SHARES
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
BASIS OF REPRESENTATION
General
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and, therefore, do not include all
information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows and stockholders' equity in
conformity with generally accepted accounting principles. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature. Operating results for the quarter
ended September 30, 1996, are not necessarily indicative of the results that can
be expected for the year ending December 31, 1996.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Current assets at September 30, 1996 were $60,000 as compared to net
current assets at September 30, 1995 of $0.00. The increase in current assets
was due to an increase in cash of $60,000 from the sale of 100,000 shares of the
Company's common stock at $.50 per share.
The Company has not received any income nor incurred any expenses as of
the quarter ended September 30, 1996, and has limited operational history. Since
the acquisition of the cash, the Company has entered into the business of
marketing and promoting Internet products and services for sponsoring companies.
Management believes that it can attract sponsors and individuals to perform
needed services for the company on a "contract basis" and therefore will not
need any employees in the immediate future. The Company has not concluded any
transactions, entered into any agreements, letters of intent, or any other
arrangements with respect to any change in control or status of the Company.
All risks inherent in new and inexperienced enterprises are inherent in the
Company's business. The Company has not made a formal study of the economic
potential of this venture.
The Company will continue to expand through its proposed business
operations and through acquisitions and will be extremely limited in its
attempts to locate potential business situations for investigation. However, the
Company's officers, directors and major shareholder believe that the present
amount of capital contributed recently is sufficient to enable it to satisfy its
reporting and other obligations as a public company for the foreseeable future.
The Company plans to continue on a limited basis, the process of investigating
possible merger and acquisition candidates, and believes that the Company's
status as a publicly-held corporation will enhance its ability to locate such
potential business ventures.
Management anticipates that due to the limited amount of its resources,
the Company may be restricted to participation in only one potential business
venture. This lack of diversification should be considered a substantial risk
because it will not permit the Company to offset potential losses from one
venture against gains from another.
<PAGE>
<TABLE>
<CAPTION>
XEBEC GALLEON, INC.
(A Development Stage Company)
BALANCE SHEETS
9/30/96 12/31/95
Unaudited Audited
----------- -----------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash in bank $ 60,000 $ - 0 -
----------- -----------
TOTAL CURRENT ASSETS 60,000 - 0 -
----------- -----------
$ 60,000 $ - 0 -
=========== ===========
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accounts payable $ - 0 - $ - 0 -
----------- -----------
TOTAL CURRENT LIABILITIES - 0 - - 0 -
STOCKHOLDERS' EQUITY Common Stock $.001 par value:
Authorized - 100,000,000 shares
Issued and outstanding
1,200,000 shares (1,000,000 in 1995) 1,200 1,000
Additional paid-in capital 60,800 1,000
Deficit accumulated during
the development stage (2,000) (2,000)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 60,000 - 0 -
----------- -----------
$ 60,000 $ - 0 -
=========== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
XEBEC GALLEON, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
4/28/86
For the three months For the nine months (Date of
ended Sept 30, ended Sept 30, inception) to
1996 1995 1996 1995 9/30/96
Unaudited Unaudited Unaudited Unaudited Unaudited
------------ ------------ ------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Net sales $ - 0 - $ - 0 - $ - 0 - $ - 0 - $ - 0 -
Cost of sales - 0 - - 0 - - 0 - - 0 - - 0 -
------------ ------------ ------------- ------------ ------------
GROSS PROFIT (LOSS) - 0 - - 0 - - 0 - - 0 - - 0 -
General and
administrative expenses - 0 - - 0 - - 0 - - 0 - 2,000
------------ ------------ ------------- ------------ ------------
NET INCOME (LOSS) $ - 0 - $ - 0 - $ - 0 - $ - 0 - $ (2,000)
============ ============= ============= ============ ============
Net income (loss) per weighted
average common shares $ .00 $ .00 $ .00 $ .00
============ ============= ============= ============
Weighted average number of
common shares used to compute
net income (loss) 1,200,000 1,000,000 1,200,000 1,000,000
============ ============ ============= ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
XEBEC GALLEON, INC.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Common Stock Additional
Par Value $.001 Paid-in Retained
Shares Amount Capital Deficit
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Balances at 4/28/86
(Date of inception) - 0 - $ - 0 - $ - 0 - $ - 0 -
Issuance of common stock (restricted)
at $.002 per share at 4/28/86 1,000,000 1,000 1,000
Net loss for period (1,950)
--------- --------- ---------- -----------
Balances at 12/31/86 1,000,000 1,000 1,000 (1,950)
Net loss for year (10)
--------- --------- ---------- -----------
Balances at 12/31/87 1,000,000 1,000 1,000 (1,960)
Net loss for year (10)
--------- --------- ---------- -----------
Balances at 12/31/88 1,000,000 1,000 1,000 (1,970)
Net loss for year (10)
--------- --------- ---------- -----------
Balances at 12/31/89 1,000,000 1,000 1,000 (1,980)
Net loss for year (10)
--------- --------- ---------- -----------
Balances at 12/31/90 1,000,000 1,000 1,000 (1,990)
Net loss for year (10)
--------- --------- ---------- -----------
Balances at 12/31/91 1,000,000 1,000 1,000 (2,000)
Net loss for year - 0 -
--------- --------- ---------- -----------
Balances at 12/31/92 1,000,000 1,000 1,000 (2,000)
Net loss for year - 0 -
--------- --------- ---------- -----------
Balances at 12/31/93 1,000,000 1,000 1,000 (2,000)
Net loss for year - 0 -
--------- --------- ---------- -----------
Balances at 12/31/94 1,000,000 1,000 1,000 (2,000)
Net loss for year - 0 -
--------- --------- ---------- -----------
Balances at 12/31/95 1,000,000 1,000 - 0 - (2,000)
Stock sold 200,000 200 59,800
Net loss for period - 0 -
--------- --------- ---------- -----------
Balances at 9/30/96 1,200,000 $ 1,200 $ 60,800 $ (2,000)
========= ========= ========== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
XEBEC GALLEON, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
4/28/86
For the nine months (Date of
ended Sept 30, inception) to
1996 1995 9/30/96
Unaudited Unaudited Unaudited
------------- ------------- -------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ - 0 - $ - 0 - $ (2,000)
Adjustments to reconcile
net income (loss) to cash
used by operating activities:
Amortization - 0 - - 0 - 50
------------- ------------- -------------
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES - 0 - - 0 - (1,950)
INVESTING ACTIVITIES
Organization Costs - 0 - - 0 - (50)
------------- ------------- -------------
NET CASH USED BY
INVESTING ACTIVITIES - 0 - - 0 - (50)
FINANCING ACTIVITIES
Proceeds from sale of
common stock 60,000 - 0 - 62,000
------------- ------------- -------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 60,000 - 0 - 62,000
------------- ------------- -------------
INCREASE IN CASH
AND CASH EQUIVALENTS 60,000 - 0 - 60,000
Cash and cash equivalents
at beginning of year - 0 - - 0 - - 0 -
------------- ------------- -------------
CASH & CASH EQUIVALENTS
AT END OF PERIOD $ 60,000 $ - 0 - $ 60,000
============= ============= =============
</TABLE>
<PAGE>
XEBEC GALLEON, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
September 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
Accounting Methods
The Company recognizes income and expenses based on the accrual method
of accounting.
Dividend Policy:
The Company has not yet adopted any policy regarding payment of
dividends.
Income Taxes:
The Company records the income tax effect of transactions in the same
year that the transactions enter into the determination of income,
regardless of when the transactions are recognized for tax purposes. Tax
credits are recorded in the year realized. Since the Company has not yet
realized income as of the date of this report, no provision for income
taxes has been made.
In February, 1992, the Financial Accounting Standards Board adopted
Statement of Financial Accounting Standards No. 109, Accounting for
Income Taxes, which supersedes substantially all existing authoritative
literature for accounting for income taxes and requires deferred tax
balances to be adjusted to reflect the tax rates in effect when those
amounts are expected to become payable or refundable. The Statement is
required to be applied in the Company's financial statements for the
fiscal year commencing January 1, 1993. The Company has elected to
recognize the cumulative effect of the change in 1993. At December 31,
1995 a deferred tax asset has not been recorded due to the Company's
lack of operations to provide income to use the net operating loss
carryover of $2,000 which will expire December 31, 2006.
NOTE 2: DEVELOPMENT STAGE COMPANY
The Company was incorporated under the laws of the State of Utah on
April 28, 1986, and changed its state of domicile to Nevada on December
30, 1993, and has been in the development stage since incorporation
NOTE 3: CAPITALIZATION
On the date of incorporation the Company sold 1,000,000 shares of its
common stock to Capital General Corporation for $2,000 cash for an
average consideration of $.002 per share. On May 29, 1996, the
Company sold 200,000 shares of its common stock for $60,000 cash for an
average consideration of $.30 per share. The Company's authorized stock
includes 100,000,000 shares of common stock at $.001 par value.
NOTE 4: RELATED PARTY TRANSACTIONS
The Company neither owns or leases any real property. Office services
are provided, without charge, by Capital General Corporation. Such costs
are immaterial to the financial statements, and, accordingly, have not
been reflected therein. The officers and directors of the Company are
involved in other business activities and may, in the future, become
involved in other business opportunities. If a specific business
opportunity becomes available, such persons may face a conflict in
selecting between the Company and their other business interests. The
Company has not formulated a policy for the resolution of such
conflicts.
<PAGE>
SIGNATURES
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.
XEBEC GALLEON, INC.
Dated: October 12, 1996 s\Krista Nielson
------------------------------------------------------
Krista Nielson, President, CEO and Director
Dated: October 12, 1996 s\David R. Yeaman
------------------------------------------------------
David R. Yeaman, Secretary/Treasurer, CFO and Director
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
XEBEC GALLEON, INC. September 30, 1996 financial statements and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000894562
<NAME> XEBEC GALLEON, INC.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 60,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 60,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 60,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 1,200
<OTHER-SE> 58,800
<TOTAL-LIABILITY-AND-EQUITY> 60,000
<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> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
