FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended September 30, 1998
Commission File Number 33-55254-41
BIOETHICS, LTD.
(Exact name of registrant as specified in its charter)
Nevada 87-0485312
(State or other jurisdiction of (IRS Employer Identification N0.)
incorporation or organization)
8092 South Juniper Court, South Weber, Utah 84405
(Address of principal executive offices)
(Zip Code)
(801) 476-8110
(Registrant's telephone number, including area code)
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 issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding as of November 11, 1998
Common Stock 11,000,000
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
September 30, December 31,
1998 1997
___________ ___________
CURRENT ASSETS:
Cash in bank $ 35,564 $ -
___________ ___________
$ 35,564 $ -
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable - -
___________ ___________
Total Current Liabilities - -
___________ ___________
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value,
25,000,000 shares authorized,
11,000,000 shares issued and
outstanding 11,000 1,000
Capital in excess of par value 30,000 -
Deficit accumulated during the
development stage (5,436) (1,000)
___________ ___________
Total Stockholders' Equity 35,564 -
___________ ___________
$ 35,564 $ -
___________ ___________
NOTE: The balance sheet at December 31, 1997 was taken from the
audited financial statements at that date and condensed.
The accompanying notes are an integral part of these unaudited
condensed financial statements.
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three For the Nine From Inception
Months Ended Months Ended on July 3,
September 30, September 30, 1990 Through
_______________ _______________ September 30,
1998 1997 1998 1997 1998
_______ _______ _______ _______ _______________
REVENUE :
Sales $ - $ - $ - $ - $ -
_______ _______ _______ _______ _______________
EXPENSES:
General and
administrative 1,671 - 4,436 - 5,436
_______ _______ _______ _______ _______________
LOSS BEFORE INCOME TAXES (1,671) - (4,436) - (5,436)
CURRENT TAX EXPENSE - - - - -
DEFERRED TAX EXPENSE - - - - -
_______ _______ _______ _______ _______________
NET LOSS $(1,671)$ - $(4,436)$ - $ (5,436)
_______ _______ _______ _______ _______________
LOSS PER COMMON SHARE $ (.00) $ (.00) $ (.00) $ (.00) $ (.00)
_______ _______ _______ _______ _______________
The accompanying notes are an integral part of these unaudited
condensed financial statements.
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the Nine From Inception
Months Ended on July 3,
September 30, 1990 Through
__________________________ September 30,
1998 1997 1998
____________ ____________ ____________
Cash Flows from Operating Activities:
Net loss $ (4,436) $ - $ (5,436)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Depreciation and amortization - - -
Changes in assets and liabilities:
Accounts payable - - -
____________ ____________ ____________
Net Cash to Operating
Activities (4,436) - (5,436)
____________ ____________ ____________
Cash Flows from Investing Activities:
Payment of organization costs - - -
____________ ____________ ____________
Net Cash to Investing
Activities - - -
____________ ____________ ____________
Cash Flows from Financing Activities:
Proceeds from common
stock issuance 40,000 - 41,000
____________ ____________ ____________
Net Cash from Financing
Activities 40,000 - 41,000
____________ ____________ ____________
Net Increase (Decrease) in Cash 35,564 - 35,564
Cash at Beginning of Period - - -
____________ ____________ ____________
Cash at End of Period $ 35,564 $ - $ 35,564
____________ ____________ ____________
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 period ended September 30, 1998 and 1997:
None
The accompanying notes are an integral part of these unaudited
condensed financial statements.
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - The Company was organized under the laws of the
State of Nevada on July 26, 1990. The Company has not yet
generated significant revenues from its planned principal
operations and is considered a development stage company as
defined in SFAS No. 7. The Company was organized to provide a
vehicle for participating in potentially profitable business
ventures which may become available through the personal contacts
of, an at the complete discretion of, the Company's officers and
directors. The Company has, at the present time, not paid any
dividends and any dividends that may be paid in the future will
depend upon the financial requirements of the Company and other
relevant factors.
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, 1998 and for all the periods presented 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 December 31, 1997 audited financial
statements. The results of operations for the periods ended
September 30, 1998 and 1997 are not necessarily indicative of the
operating results for the full year.
Accounting Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
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
statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimated by management.
NOTE 2 - COMMON STOCK
During July 1990, in connection with its organization, the
Company issued 1,000,000 shares of its previously authorized, but
unissued common stock. Total proceeds from the sale of stock
amounted to $1,000 (or $.001 per share).
During May 1998, the Company issued 10,000,000 shares of its
previously authorized, but unissued common stock. Total proceeds
from the sale of stock amounted to $40,000 (or $.004 per share).
The issuance of common stock resulted in a change in control of
the Company [See Note 5].
NOTE 3 - INCOME TAXES
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes". FASB 109 requires the Company to provide a
net deferred tax asset/liability equal to the expected future tax
benefit/expense of temporary reporting differences between book
and tax accounting methods and any available operating loss or
tax credit carryforwards. At September 30, 1997, there were no
material deferred tax assets or liabilities, current or deferred
tax expense, or net operating loss carryforwards.
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 4 - RELATED PARTY TRANSACTIONS
Management Compensation - The Company has not paid any
compensation to its officers and directors.
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.
NOTE 5 - CHANGES IN CONTROL
During May 1998, the Company raised $40,000 through the sale of
10,000,000 shares of common stock. The shares sold represent
approximately ninety-one percent (91%) of the outstanding shares
of common stock of the Company resulting in a change in control
of the Company. The proceeds from the stock sale will be used to
pay for legal and accounting fees and for management to search
for possible business opportunities. The former officers and
directors of the Company resigned and an individual holding
approximately 23% of the outstanding common stock was appointed
as the sole member of the Board of Directors of the Company and
as the new President, Chief Executive Officer, Chief Financial
Officer, and Secretary/Treasurer of the Company.
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 three months ended September 30, 1998, for the nine months
ended September 30, 1998 and from inception on July 3, 1996
through September 30, 1998:
For the Three For the Nine From Inception
Months Ended Months Ended on July 3,
September 30, September 30, 1996 Through
_____________________ _____________________September 30,
1998 1997 1998 1997 1998
__________ __________ __________ __________ __________
Income (loss) from
continuing operations
applicable to common
stock $ (1,671) $ - $ (4,436) $ - $ (5,436)
__________ __________ __________ __________ __________
Income (loss) available
to common stockholders
used in income (loss)
per share $ (1,671) $ - $ (4,436) $ - $ (5,436)
__________ __________ __________ __________ __________
Weighted average
number of common
shares outstanding
used in earnings
per share during
the period 11,000,000 1,000,000 5,542,125 1,000,000 1,404,185
__________ __________ __________ __________ __________
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.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
The following discussion and analysis provides information
which management believes is relevant to an assessment and
understanding of the Company's consolidated results of operations
and financial condition. The discussion should be read in
conjunction with the consolidated financial statements and notes
thereto.
The Company has no business operations, and very limited
assets or capital resources. The Company's business plan is to
seek one or more potential business ventures that, in the opinion
of management, may warrant involvement by the Company. The
Company recognizes that because of its limited financial,
managerial and other resources, the type of suitable potential
business ventures which may be available to it will be extremely
limited. The Company's principal business objective will be to
seek long-term growth potential in the business venture in which
it participates rather than to seek immediate, short-term
earnings. In seeking to attain the Company's business objective,
it will not restrict its search to any particular business or
industry, but may participate in business ventures of essentially
any kind or nature. It is emphasized that the business objectives
discussed are extremely general and are not intended to be
restrictive upon the discretion of management.
The Company will not restrict its search for any specific
kind of firms, but may participate in a venture in its
preliminary or development stage, may participate in a business
that is already in operation or in a business in various stages
of its corporate existence. It is impossible to predict at this
stage the status of any venture in which the Company may
participate, in that the venture may need additional capital, may
merely desire to have its shares publicly traded, or may seek
other perceived advantages which the Company may offer. In some
instances, the business endeavors may involve the acquisition of
or merger with a corporation which does not need substantial
additional cash but which desires to establish a public trading
market for its common stock.
The Company does not have sufficient funding to meet its
anticipated cash needs. The current sole officer and director has
expressed his intent to borrow funds to the extent possible, to
fund the costs of operating the Company until a suitable business
venture can be completed. Management does not anticipate raising
funds during the next twelve months through the sale of
securities. There is no assurance that the Company will be able
to successfully identify and/or negotiate a suitable potential
business venture or raise additional funding.
The Company has experienced net losses during the
development stage (July 3, 1990 to present) and has had no
significant revenues during such period. During the past two
fiscal years the Company has had no business operations. In light
of these circumstances, the ability of the Company to continue as
a going concern is significantly in doubt. The attached financial
statements do not include any adjustments that might result from
the outcome of this uncertainty.
Forward-Looking Statements
When used in this Form 10-Q or other filings by the Company
with the Securities and Exchange Commission, in the Company's
press releases or other public or shareholder communications, or
in oral statements made with the approval of an authorized
officer of the Company's executive officers, the words or phrases
"would be", "will allow", "intends to", "will likely result",
"are expected to", "will continue", "is anticipated", "estimate",
"project", or similar expressions are intended to identify
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995.
The Company cautions readers not to place undue reliance
on any forward-looking statements, which speak only as of the
date made, and advises readers that forward-looking statements
involve various risks and uncertainties. The Company does not
undertake, and specifically disclaims any obligation to update
any forward-looking statements to reflect occurrences or
unanticipated events or circumstances after the date of such
statement.
<PAGE>
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 Vote of Securityholders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a)
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
3(i).1 Articles of Incorporation of the Company
(Incorporated by reference to Exhibit 3(i).1 of the
Company's Form 10-Q, dated June 30, 1998).
3(ii).1 Bylaws of the Company (Incorporated by reference to
Exhibit 3(ii).1 of the Company's Form 10-Q, dated
June 30, 1998).
27 Financial Data Schedule
(b) Reports on Form 8-K:
None.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BIOETHICS, LTD.
Date: November 12, 1998 By /s/ Mark J. Cowan
Mark J. Cowan
President, Chief Executive
Officer, Chief Financial
Officer and Director
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM FINANCIAL STATEMENTS FOR THE NINE MONTH PERIOD ENDED
SEPTEMBER 30, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 35,564
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 35,564
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 35,564
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 11,000
<OTHER-SE> 24,564
<TOTAL-LIABILITY-AND-EQUITY> 35,564
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,436
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (4,436)
<INCOME-TAX> 0
<INCOME-CONTINUING> (4,436)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,436)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
