U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
[ ] 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. 33-33263-NY
GTM HOLDINGS, INC.
(Exact name of small business issuer as specified in its charter)
Nevada 62-1407521
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
5882 South 900 East, Suite 202, Salt Lake City, Utah 84121
(Address of principal executive offices)
(801) 269-9500
(Issuer's telephone number)
TRIAD WARRANTY CORPORATION, INC.
5882 South 900 East, Suite 202, Salt Lake City, Utah 84121
(Former name, address and fiscal year, if changed since last report)
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 issuer
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 ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Check whether the registrant has filed all documents and reports
required to be filed by Sections 12, 13, or 15(d) of the
Exchange Act subsequent to the distribution of securities under
a plan confirmed by a court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
State the number of shares outstanding of each of the issuer's
classes of common equity, as of November 9, 2000: 2,299,886
shares of common stock.
Transitional Small Business Format: Yes [ ] No [ X ]
Documents incorporated by reference: None
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FORM 10-QSB
GTM HOLDINGS, INC.
INDEX
Page
PART I. Financial Information 3
Condensed Balance Sheets for the Period 4
Ending September 30, 2000 and December
31, 1999 (unaudited)
Condensed Statement of Operations from 5
for the Three and Nine Months Ended
September 30, 2000 and 1999 and from the
re-entering of development stage on
December 27, 1993 through September 30,
2000 (unaudited)
Condensed Statement of Cash Flows for the 6
Three and Nine Months Ended September 30,
2000 and 1999 and from the re-entering of
development stage on December 27, 1993
through September 30, 2000 (unaudited)
Notes to Unaudited Condensed Financial 7
Statements
Management's Discussion and Analysis of 11
Financial Condition
PART II. Other Information 12
Signatures 12
2
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PART I.
Financial Information
In the opinion of management, the accompanying unaudited financial statements
included in this Form 10-QSB reflect all adjustments (consisting only of
normal recurring accruals) necessary for a fair presentation of the results
of operations for the periods presented. The results of operations for the
periods presented are not necessarily indicative of the results to be
expected for the full year.
3
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
CONDENSED BALANCE SHEETS
[Unaudited]
ASSETS
September 30, December 31,
2000 1999
___________ ___________
CURRENT ASSETS: $ - $ -
___________ ___________
Total Current Assets - -
___________ ___________
$ - $ -
____________ ____________
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
CURRENT LIABILITIES:
Accounts payable - related party $ 2,354 $ -
Liabilities of discontinued operations - 56,380
___________ ___________
Total Current Liabilities 2,354 56,380
___________ ___________
STOCKHOLDERS' (DEFICIT):
Common stock, $.001 par value, 25,000,000
shares authorized, 2,299,886 and 264,886
shares issued and outstanding,
respectively 2,300 265
Capital in excess of par value 112,521 77,206
Retained deficit (76,353) (76,353)
Deficit accumulated during the
development stage (40,822) (57,498)
___________ ___________
Total Stockholders' (Deficit) (2,354) (56,380)
___________ ___________
$ - $ -
____________ ____________
Note: The Balance Sheet of December 31, 1999 was taken from the
audited financial statement at that date.
The accompanying notes are an integral part of these unaudited
financial statements.
4
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
CONDENSED STATEMENTS OF OPERATIONS
[Unaudited]
Cumulative from
the Re-entering of
For the Three For the Nine Development Stage
Months Ended Months Ended on December 27,
September 30, September 30, 1993 through
__________________ __________________ September 30,
2000 1999 2000 1999 2000
_______ ________ _______ ________ ___________
REVENUE $ - $ - $ - $ - $ -
_______ ________ _______ ________ ___________
EXPENSES:
General and
administrative 2,454 - 32,204 - 33,322
Loss from default
judgement - - - - 56,380
_______ ________ _______ ________ ___________
LOSS FROM
OPERATIONS (2,454) - (32,204) - (89,702)
CURRENT
INCOME TAXES - - - - -
DEFERRED
INCOME TAX - - - - -
_______ ________ _______ ________ ___________
LOSS FROM
CONTINUING
OPERATIONS (2,454) - (32,204) - (89,702)
_______ ________ _______ ________ ___________
EXTRAORDINARY ITEMS:
Gain from
settlement of debt - - 48,880 - 48,880
_______ ________ _______ ________ ___________
NET INCOME
(LOSS) $(2,454) $ - $16,676 $ - $ (40,822)
________ _________ ________ _________ ____________
INCOME (LOSS) PER
SHARE:
(Loss) from continuing
operations $ (.00) $ - $ (.02) $ - $ (.04)
Gain from extraordinary
item - - $ .03 $ - $ .02
_______ ________ _______ ________ ___________
Total Income (Loss)
Per Share $ (.00) $ - $ .01 $ - $ (.02)
________ _________ ________ _________ ____________
The accompanying notes are an integral part of these unaudited
financial statements.
5
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
CONDENSED STATEMENTS OF CASH FLOWS
[Unaudited]
Cumulative from
the Re-entering of
For the Nine Development Stage
Months Ended on December 27,
September 30, 1993 through
_____________________ September 30, 2000
2000 1999
_________ ___________ _________________
Cash Flows Provided by
Operating Activities:
Net income (loss) $ 16,676 $ - $ (40,822)
Adjustments to reconcile
net loss to net cash used
by operating activities:
Amortization - - 1,068
Stock issued for services 560 - 610
Gain on settlement of debt (48,880) - (48,880)
Loss from default judgement - - 56,380
Expenses paid by related party 29,290 - 29,290
Changes in assets and liabilities:
Increase in accounts payable -
related party 2,354 - 2,354
________________________________
Net Cash (Used) by Operating
Activities - - -
________________________________
Cash Flows Provided by Investing Activities:
- - -
________________________________
Net Cash (Used) by Investing Activities - - -
________________________________
Cash Flows Provided by Financing Activities:
- - -
________________________________
Net Cash Provided by Financing Activities
- - -
________________________________
Net Increase (Decrease) in Cash - - -
Cash at Beginning of the Year - - -
________________________________
Cash at End of the Year $ - $ - $ -
___________________________________
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Supplemental Schedule of Noncash Investing and Financing
Activities:
For the nine months ended September 30, 2000:
The Company issued 2,000,000 shares of common stock to reduce a payable
to related party of $36,790, or $.02 per share.
The Company issued 25,000 shares of common stock for services rendered
valued at $460 or $.02 per share.
In July 2000, the Company issued 10,000 shares of common stock for
services rendered valued at $100 or $.01 per share.
For the nine months ended Sept 30, 1999: None
The accompanying notes are an integral part of these unaudited financial
statements.
6
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Triad Warranty Corporation, Inc. (formerly "Fulton
Ventures, Inc.") was organized under the laws of the State of
Nevada on September 21, 1989. On May 22, 2000 Triad Warranty
Corporation changed their name to GTM Holdings, Inc. GTM
Holdings, Inc. (the Company) was formed to purchase, merge with
or acquire any business or assets which management believed had
potential for being profitable. On June 14, 1990, the Company
exchanged 2,464,829 of its common shares for all the outstanding
shares of Triad Warranty Corporation.
Triad Warranty Corporation was organized under the laws of the
state of Texas on November 21, 1988. The purpose of this Company
was to provide extended warranty service coverage for heating and
air conditioning units and their component parts and various
other consumer products. This Company began operations in
January 1989, in Dallas Texas. The Board of Directors met on
December 27, 1993, and determined it was in the best interest of
Triad Warranty Corporation, Inc. (Nevada) and its sole operating
subsidiary, Triad Warranty Corporation, to separate ownership.
To effect this transaction, selected shareholders in the Company
were issued their pro rata shares in Triad Warranty Corporation,
and the original 2,464,829 shares of common stock were returned
to the Company for cancellation. This transaction was accounted
for in the financial statement of the Company as a discontinued
operation as of December 27, 1993. The Company is considered to
have re-entered into a new development stage on December 27,1993.
Condensed Financial Statements - The accompanying financial
statements have been prepared by the Company without audit. In
the opinion of management, all adjustments (which include only
normal recurring adjustments) necessary to present fairly the
financial position, results of operations and cash flows at
September 30, 2000 and 1999 and for the periods then ended have
been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
It is suggested that these condensed financial statements be read
in conjunction with the financial statements and notes thereto
included in the Company's September 30, 2000 audited financial
statements. The results of operations for the period ended
September 30, 2000 are not necessarily indicative of the
operating results for the full year.
Development Stage - The Company is considered a development stage
company as defined in SFAS no. 7. Consequently, cumulative
numbers have been provided from December 27,1993 forward to
reflect the change in control and the change in the Company's
planned operations which was effective as of 1994. During 2000
the Company under went a change in ownership control which has
resulted in a change in the officers and Board of Director's of
the Company.
Loss Per Share - The computation of loss per share of common
stock is based on the weighted average number of shares
outstanding during the periods presented, in accordance with
Statement of Financial Accounting Standards No. 128, "Earnings
Per Share" [See Note 6].
Cash and Cash Equivalents - For purposes of the statement of cash
flows, the Company considers all highly liquid debt investments
purchased with a maturity of three months or less to be cash
equivalents.
7
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [CONTINUED]
Accounting Estimates - The preparation of financial statement in
conformity with generally accepted accounting principles required
management to make estimates and assumptions that effect the
reported amounts of assets and liabilities, the disclosures of
contingent assets and liabilities at the date of the Financial
Statement, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimated by management.
Recently Enacted Accounting Standards - Statement of Financial
Accounting Standards (SFAS) No. 136, "Transfers of Assets to a
not for profit organization or charitable trust that raises or
holds contributions for others", SFAS No. 137, "Accounting for
Derivative Instruments and Hedging Activities - deferral of the
effective date of FASB Statement No. 133 (an amendment of FASB
Statement No. 133.),", SFAS No. 138 "Accounting for Certain
Derivative Instruments and Certain Hedging Activities - and
Amendment of SFAS No. 133", SFAS No. 139, "Recission of SFAS No.
53 and Amendment to SFAS No 63, 89 and 21", and SFAS No. 140,
"Accounting to Transfer and Servicing of Financial Assets and
Extinguishment of Liabilities", were recently issued SFAS No.
136, 137, 138, 139 and 140 have no current applicability to the
Company or their effect on the financial statements would not
have been significant.
NOTE 2 - CAPITAL STOCK
Common Stock - During May 2000, the Company issued 2,000,000
shares of its previously authorized, but unissued common stock to
reimburse a related party for Company expenses paid by the
related party in the amount of $36,790 or $.02 per share.
The Company also issued 25,000 shares during June 2000 to an
officer for services rendered, valued at $460 or $.02 per share.
In July 2000, the Company issued 10,000 shares of common stock to
an officer for services rendered valued at $100 or $.01 per
share.
During 1994, the Company issued 50,000 shares of its previously
authorized, but unissued common stock for services rendered,
valued at $50 or $.001 per share.
NOTE 3 - INCOME TAXES
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes" which requires the liability approach for the
effect of income taxes.
8
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 3 - INCOME TAXES - [CONTINUED]
The Company has available at September 30, 2000, unused operating
loss carryforwards of approximately $40,000, which may be applied
against future taxable income and which expire in various years
through 2019. If certain substantial changes in the Company's
ownership should occur, there could be an annual limitation on
the amount of net operating loss carryforwards which can be
utilized. The amount of and ultimate realization of the benefits
from the operating loss carryforwards for income tax purposes is
dependent, in part, upon the tax laws in effect, the future
earnings of the Company and other future events, the effects of
which cannot be determined. Because of the uncertainty
surrounding the realization of the loss carryforwards the Company
has established a valuation allowance equal to the tax effect of
the loss carryforwards (approximately $15,600) at September 30,
2000 and, therefore, no deferred tax asset has been recognized
for the loss carryforwards. The change in the valuation
allowance is equal to the tax effect of the current period's net
(loss) approximately ($600).
NOTE 4 - EXTRAORDINARY ITEM
During May 2000, the Company settled a judgement in the amount of
$56,380 which was related to the previously discontinued
operations. The judgement was settled for $7,500, resulting in a
gain on debt extinguishment of $48,880.
NOTE 5 - RELATED PARTY TRANSACTIONS
Management Compensation - During April 2000 a related party paid
$22,500 to a former officer of the Company for consulting
services rendered to the Company.
During June 2000, the Company issued 25,000 shares of common
stock to an officer for services rendered, valued at $460 or $.02
per share.
In July 2000, the Company issued 10,000 shares of common stock to
an officer for services rendered valued at $100 or $.01 per
share.
Office Space - The Company has not had a need to rent office
space. An officer/shareholder of the Company is allowing the
Company to use his home as a mailing address, as needed, at no
expense to the Company.
Expenses Paid By Related Party - An entity related to an officer
of the Company paid expenses on behalf of the Company totaling
$36,790. The Company issued 2,000,000 shares of common stock
valued at $36,790 to repay the debt ($.018 per share).
At September 30, 2000 a related party had advanced $2,354 to the
Company to cover operating expenses.
9
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GTM HOLDINGS, INC.
(Formerly Triad Warranty Corporation)
[A Development Stage Company]
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 6 - EARNINGS (LOSS) PER SHARE
The following data show the amounts used in computing income
(loss) per share and the effect on income and the weighted
average number of shares of dilutive potential common stock for
the nine months ended September 30, 2000 and 1999 and for the
period from the re-entering of development stage on December 27,
1993 through September 30, 2000:
Cumulative from
the Re-entering of
For the Three For the Nine Development Stage
Months Ended Months Ended on December 27,
September 30, September 30, 1993 through
_________________________________________ September30,
2000 1999 2000 1999 2000
_________ _________ _________ __________ __________
(Loss) from continuing
operations available
to common stockholders
(numerator) $(2,454) $ - $ (32,204) $ - $ (89,702)
_________ _________ ________ ________ ____________
Extraordianry item - Gain
from settlement of debt
(numerator) $ - $ - $ 48,880 $ - $ 48,880
_________ _________ _________ ________ ___________
Weighted average number of
common shares outstanding
used in earnings per share
during the period
(denominator) 2,298,473 264,886 1,320,233 264,886 2,614,001
_________ _________ __________ ________ ____________
Dilutive earnings per share was not presented, as the Company had
no common equivalent shares for all periods presented that would
effect the computation of diluted earnings (loss) per share.
Treasury stock which was being held by the Company for
cancellation has not been included in the calculations as it was
considered cancelled for all periods presented.
NOTE 7 - GOING CONCERN
The accompanying financial statements have been prepared in
conformity with generally accepted accounting principles, which
contemplate continuation of the Company as a going concern.
However, the Company has incurred losses since its inception and
has not yet been successful in establishing profitable
operations. Further, the Company has no working capital to pay
its expenses. These factors raise substantial doubt about the
ability of the Company to continue as a going concern. In this
regard, management is proposing to raise any necessary additional
funds not provided by operations through loans or through sales
of its common stock or through a possible business combination
with another company. There is no assurance that the Company
will be successful in raising this additional capital or
achieving profitable operations. The financial statement do not
include any adjustments that might result from the outcome of
these uncertainties.
10
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION
Forward-Looking Statements
This Form 10-QSB includes, without limitation, certain statements
containing the words "believes", "anticipates", "estimates",
"intends", and words of a similar nature, constitute "forward-
looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. This Act provides a "safe harbor"
for forward-looking statements to encourage companies to provide
prospective information about themselves so long as they identify
these statements as forward looking and provide meaningful,
cautionary statements identifying important factors that could
cause actual results to differ from the projected results. All
statements other than statements of historical fact made in this
Form 10-QSB are forward-looking. In particular, the statements
herein regarding industry prospects and future results of
operations or financial position are forward-looking statements.
Forward-looking statements reflect management's current
expectations and are inherently uncertain. The Company's actual
results may differ significantly from management's expectations.
Results of Operations
For the Three and Nine Months Period Ended September 30, 2000 and
1999
The Company had no revenue from continuing operations for the
three-month and nine-month periods that ended September 30, 2000
and 1999.
General and administrative expenses for the three month-period
that ended September 30, 2000 and 1999, were $2,454 and $0,
respectively. General and administrative expenses for the nine
month-period that ended September 30, 2000 and 1999, were $32,204
and $0, respectively. These expenses consisted of general
corporate administration, legal and professional expenses,
accounting and auditing costs, and $22,500 in consulting fees
paid to a former officer of the Company during the second
quarter.
The Company realized no gains for the three and nine-month
periods that ended September 30, 2000 and 1999; except for an
extraordinary item due to the settlement of an outstanding
judgment against the Company, originally in the amount of
$56,380, for $7,500; which resulted in $48,880 in debt
extinguishments.
As a result of the foregoing factors, the Company realized a net
loss of $2,454 for the three-month period and a net loss of
$32,204 for the nine-month period (set off by the $48,880 in debt
extinguishments) that ended September 30, 2000, compared to no
income or loss for the same periods of 1999.
Liquidity and Capital Resources
At September 30, 2000, the Company had a working capital deficit
of approximately $2,354, as compared to no working capital at
December 31, 1999. This decrease in the working capital is
attributable to general and administrative expenses incurred
during the fiscal quarters, without any increase in cash.
The Company does not have sufficient cash to meet its operational
needs for the next twelve months. Management, like in the past,
will attempt to raise capital for its current operational needs
through debt financing, equity financing or a combination of
financing options. However, there are no existing
understandings, commitments or agreements for such an infusion;
nor can there be assurances to that effect. Moreover, the
Company's need for capital may change dramatically if and during
that period, it acquires an
11
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interest in a business opportunity. Unless the Company can
obtain additional financing, its ability to continue as a going
concern is doubtful.
The Company's current operating plan is to (i) handle the
administrative and reporting requirements of a public company,
and (ii) search for potential businesses, products, technologies
and companies for acquisition. At present, the Company has no
understandings, commitments or agreements with respect to the
acquisition of any business venture, and there can be no
assurance that the Company will identify a business venture
suitable for acquisition in the future. Further, there can be no
assurance that the Company would be successful in consummating
any acquisition on favorable terms or that it will be able to
profitably manage any business venture it acquires.
PART II. OTHER INFORMATION
Changes in Securities and Use of Proceeds
In July 2000 the Company issued 10,000 shares of common stock to
an officer for services rendered, valued at $184. The shares
were not issued in connection with any public offering. The
Company relied upon Section 4(2) of the Securities Act to effect
the transaction, and no commissions were paid on the transaction.
Exhibits and Reports on Form 8-K
Reports on Form 8-K: No reports on Form 8-K were filed by the
Company during the quarter ended September 30, 2000.
Exhibits: Included only with the electronic filing of this report
is the Financial Data Schedule for the Nine Month Period Ended
September 30, 2000 (Exhibit ref. No. 27).
SIGNATURES
In accordance with the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned thereunto
duly authorized.
GTM Holdings, Inc
Date: November 14, 2000 By:/s/Kip Eardley
Kip Eardley, President,Secretary,
Treasurer and Director
12
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