U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under
the Securities Exchange Act of 1934
For Quarter Ended: June 30, 1999
Commission File Number: 0-25562
GENESIS COMPANIES GROUP, INC.
(Exact name of small business issuer as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
72-1175963
(IRS Employer Identification No.)
830 S. Kline Way
Lakewood, Colorado
(Address of principal executive offices)
80226
(Zip Code)
(303) 985-3972
(Issuer's Telephone Number)
(Former name, former address and former fiscal year, if changed
since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 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 ____.
The number of shares of the registrant's only class of common stock issued and
outstanding, as of June 30, 1999, was 4,500,000 shares.
<PAGE>
PART I
ITEM 1. FINANCIAL STATEMENTS.
The unaudited financial statements for the six month period ended June 30,
1999, are attached hereto.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the Financial
Statements and notes thereto included herein.
The Company generated no revenues during the six month period ended June
30, 1999. Management of the Company anticipates that the Company will not
generate any significant revenues until the Company accomplishes its business
objective of merging with a nonaffiliated entity or acquiring assets from the
same.
The Company's securities are currently not liquid. There are no market
makers in the Company's securities and it is not anticipated that any market
will develop in the Company's securities until such time as the Company
successfully implements its business plan of engaging in a business opportunity,
either by merger or acquisition of assets. The Company presently has no liquid
financial resources to offer such a candidate and must rely upon an exchange of
its stock to complete such a merger or acquisition.
Because the Company is not required to pay rent or salaries to any of its
officers or directors, management believes that the Company has sufficient funds
to continue operations through the foreseeable future.
Forward Looking Statements
This report contains certain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") concerning the Company's
operations, economic performance and financial conditions, including, in
particular, the likelihood of the Company's ability to acquire another existing
business or assets. These statements are based upon a number of assumptions and
estimates which are inherently subject to significant uncertainties and
contingencies, many of which are beyond the control of the Company and reflect
future business decisions which are subject to change. Some of these assumptions
inevitably will not materialize and unanticipated events will occur which will
affect the Company's results. Consequently, actual results will vary from the
statements contained herein and such variance may be material. Prospective
investors should not place undue reliance on this information.
2
<PAGE>
Year 2000 Disclosure
Many existing computer programs use only two digits to identify a year in
the date field. These programs were designed and developed without considering
the impact of the upcoming change in the century. If not corrected, many
computer applications could fail or create erroneous results by or at the Year
2000. As a result, many companies will be required to undertake major projects
to address the Year 2000 issue. Because the Company has nominal assets,
including no personal property such as computers, it is not anticipated that the
Company will incur any negative impact as a result of this potential problem.
However, it is possible that this issue may have an impact on the Company after
the Company successfully consummates a merger or acquisition. Management intends
to address this potential problem with any prospective merger or acquisition
candidate. There can be no assurances that new management of the Company will be
able to avoid a problem in this regard after a merger or acquisition is so
consummated.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS - None
ITEM 2. CHANGES IN SECURITIES - NONE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES - NONE
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
EX-27 Financial Data Schedule
(b) Reports on Form 8-K
None
3
<PAGE>
<TABLE>
GENESIS COMPANIES GROUP, INC.
(A Development Stage Company)
Unaudited
Balance Sheet
<CAPTION>
Unaudited Audited
June 30, December 31
1999 1998
--------- -----------
<S> <C> <C>
ASSETS
Current Assets - Cash $ 0 $ 0
--------- -----------
TOTAL ASSETS $ 0 $ 0
========= ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Current Liabilities -
Accounts Payable $ 14,838 $ 9,300
Short Term Borrowings from
Shareholders 13,696 13,557
--------- -----------
Total Current Liabilities 28,534 22,857
Long-Term Liabilities 0 0
--------- -----------
Total Long-Term Liabilities 0 0
--------- -----------
Total Liabilities $ 28,534 $ 22,857
Shareholder's Equity
Common Stock, Par Value $.00001 Per
Share; 100,000,000 Shares Authorized,
4,500,000 Issued and Outstanding at
June 30, 1999, and December 31,
1998, respectively $ 45 $ 45
Preferred Stock, Par Value $.00001 Per
Share; 10,000,000 Shares Authorized 0 0
Additional Paid-in Capital 13,455 13,455
Deficit Accumulated During
the Development Stage (42,034) (36,357)
--------- -----------
Total Shareholders' Equity $ (28,534) $ (22,857)
--------- -----------
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY $ 0 $ 0
========= ===========
</TABLE>
4
<PAGE>
<TABLE>
GENESIS COMPANIES GROUP, INC.
(A Development Stage Company)
Unaudited
Statement of Operations
<CAPTION>
For the For the December 22, 1988
Six Months Six Months (Inception)
Ended Ended Thru
June 30, June 30, June 30,
1999 1998 1999
------------ ------------ -----------------
<S> <C> <C> <C>
Income $ 0 $ 0 $ 0
Operating Expenses
Professional Fees 2,812 3,066 28,158
Registration Fees 139 0 3,629
Administrative Expenses 2,727 0 10,247
------------ ------------ -----------------
Total Operating Expenses 5,678 3,066 42,034
Net Loss from Operations $ (5,678) $ (3,066) $ (42,034)
============ ============ =================
Weighted Average Number of
Shares Outstanding 4,500,000 4,500,000 4,500,000
Net Loss Per Share $ (*) $ (*) $ (*)
*Less than $0.01 Per Share.
</TABLE>
5
<PAGE>
<TABLE>
GENESIS COMPANIES GROUP, INC.
(A Development Stage Company)
Unaudited
Statement of Operations
<CAPTION>
For the For the
Three Months Three Months
Ended Ended
June 30, June 30,
1999 1998
------------ ------------
<S> <C> <C>
Income $ 0 $ 0
Operating Expenses
Professional Fees 1,282 1,582
Registration Fees 0 0
Administrative Expenses 2,727 0
------------ ------------
Total Operating Expenses 4,009 1,582
Net Loss from Operations $ (4,009) $ (1,582)
============ ============
Weighted Average Number of
Shares Outstanding 4,500,000 4,500,000
Net Loss Per Share $ (*) $ (*)
*Less than $0.01 Per Share.
</TABLE>
6
<PAGE>
<TABLE>
GENESIS COMPANIES GROUP, INC.
(A Development Stage Company)
Unaudited Cash Flow Statement
<CAPTION>
For the For the December 22, 1988
Six Months Six Months (Inception)
Ended Ended Thru
June 30, June 30, June 30,
1999 1998 1999
------------ ------------ --------------
<S> <C> <C> <C>
Cash Flows From
Operating Activities:
Net Profit (Loss) $ (5,678) $ (3,066) $ (42,034)
Increase (Decrease) in
Accounts Payable 4,256 3,066 13,555
Shareholder Note Payable 1,422 0 14,979
------------ ----------- -------------
Net Cash Provided (Used)
By Operating Activities 0 0 (13,500)
Cash Flows From
Financing Activities:
Issuance of Common Stock 0 0 13,500
------------ ----------- -------------
Net Cash Provided (Used)
in Financing Activities 0 0 13,500
------------ ----------- -------------
Increase (Decrease) in Cash 0 0 0
Cash and Cash Equivalents -
Beginning of Period 0 0 0
------------ ----------- -------------
Cash and Cash Equivalents -
End of Period $ 0 $ 0 $ 0
============ =========== =============
</TABLE>
7
<PAGE>
GENESIS COMPANIES GROUP, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited)
NOTE 1 - Organization
- ------ ------------
Organization - The Company was organized as a Delaware
Corporation on December 22, 1988.
Basis of Presentation - The Company is in the development
stage and is primarily engaged in raising capital. On or about
March 29, 1990, the Company filed a registration statement on
Form S-18 with the Securities and Exchange Commission, wherein
the Company attempted to register 20,000 Units, each Unit
consisting of 100 shares of the Company's Common Stock and 100
Class A, Class B and Class C Common Stock Purchase Warrants.
This registration statement was subsequently voluntarily
abandoned by the Company prior to effectiveness. Other than
filing of the aforesaid registration statement, the only
activities undertaken by the Company since its inception has
been the issuing of 4,500,000 shares of the Company's Common
Stock to its original shareholders, which stock was issued in
exchange for aggregate cash consideration of $13,500. Each
shareholder of the Company has executed and delivered a
"lock-up" letter agreement, affirming that they shall not sell
their respective shares of the Company's Common Stock until
such time as the Company has successfully consummated a merger
or acquisition has been consummated, and each shareholder has
agreed to place their respective stock certificate with the
Company's legal counsel who will not release these respective
certificates until such time as legal counsel has confirmed
that a merger or acquisition has been successfully
consummated.
NOTE 2 - Summary of Significant Accounting Policies:
- ------ ------------------------------------------
Revenue is recognized when earned and expenses are recognized
when they occur.
Loss Per Share - Net loss per common share is based upon the
weighted average common share outstanding during each period.
8
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 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.
GENESIS COMPANIES GROUP, INC.
(Registrant)
Dated: August 12, 1999
By: s/Wm. Ernest Simmons
-----------------------------------
Wm. Ernest Simmons
President
9
<PAGE>
GENESIS COMPANIES GROUP, INC.
EXHIBIT INDEX TO QUARTERLY REPORT ON FORM 10-QSB
FOR THE QUARTER ENDED JUNE 30, 1999
EXHIBITS Page No.
EX-27 Financial Data Schedule..............................................11
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 1999, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 28,534
<BONDS> 0
0
0
<COMMON> 45
<OTHER-SE> (28,579)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,678
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5,678)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,678)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,678)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
