FORM 10-QSB
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 1999
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 No.)
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
State 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 May 6, 1999
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
March 31, December 31,
1999 1998
___________ ___________
CURRENT ASSETS:
Cash in bank $ 34,598 $ 35,564
___________ ___________
$ 34,598 $ 35,564
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,225 $ 899
___________ ___________
Total Current Liabilities 2,225 899
___________ ___________
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value,
25,000,000 shares authorized,
11,000,000 shares issued and
outstanding 11,000 11,000
Capital in excess of par value 30,000 30,000
Deficit accumulated during the
development stage (8,627) (6,335)
___________ ___________
Total Stockholders' Equity 32,373 34,665
___________ ___________
$ 34,598 $ 35,564
___________ ___________
NOTE: The balance sheet at December 31, 1998 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.
-2-
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
____________________ March 31,
1999 1998 1999
__________ __________ ______________
REVENUE $ - $ - $ -
__________ __________ ______________
EXPENSES
General and administrative 2,292 - 8,627
__________ __________ ______________
LOSS BEFORE INCOME TAXES (2,292) - (8,627)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
__________ __________ ______________
NET LOSS $(2,292) $ - $ (8,627)
__________ __________ ______________
LOSS PER COMMON SHARE $ (.00) $ (.00) $ (.00)
__________ __________ ______________
The accompanying notes are an integral part of these unaudited condensed
financial statements.
-3-
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
____________________ March 31,
1999 1998 1999
__________ __________ ______________
Cash Flows from Operating
Activities:
Net loss $(2,292) $ - $ (8,627)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Depreciation and amortization - - -
Changes in assets and
liabilities:
Accounts payable 1,326 - 2,225
__________ __________ ______________
Net Cash (used) by Operating
Activities (966) - (6,402)
__________ __________ ______________
Cash Flows from Investing
Activities:
Payment of organization costs - - -
__________ __________ ______________
Net Cash provided by Investing
Activities - - -
__________ __________ ______________
Cash Flows from Financing
Activities:
Proceeds from common stock
issuance - - 41,000
__________ __________ ______________
Net Cash provided by Financing
Activities - - 41,000
__________ __________ ______________
Net Increase (Decrease) in Cash (966) - 34,598
Cash at Beginning of Period 35,564 - -
__________ __________ ______________
Cash at End of Period $34,598 $ - $ 34,598
__________ __________ ______________
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 March 31, 1999:
None
For the period ended March 31, 1998:
None
The accompanying notes are an integral part of these unaudited condensed
financial statements.
-4-
<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, and 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
March 31, 1999 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, 1998
audited financial statements. The results of operations for the periods ended
March 31, 1999 and 1998 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 March 31, 1999, there were no material deferred
tax assets or liabilities, current or deferred tax expense, or net operating
loss carryforwards.
-5-
<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 March 31, 1999 and 1998 and
from inception on July 26, 1990 through March 31, 1999:
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
________________________ March 31,
1999 1998 1999
____________ __________ ______________
Income (loss) from continuing
operations applicable to
common stock $ (2,292) $ - $ (8,627)
____________ __________ _____________
Weighted average number of
common shares outstanding
used in earnings per share
during the period 11,000,000 1,000,000 2,053,628
____________ __________ _____________
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.
-6-
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
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.
Plan of Operation
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.
7
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities and Use of Proceeds.
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 DESCRIPTION OF EXHIBIT
NO.
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.
8
<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: May 10, 1999 By /s/ Mark J. Cowan
Mark J. Cowan
President, Chief Executive
Officer, Chief Financial
Officer and Director
<PAGE>
EXHIBIT 27.1
(Financial Data Schedule)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from financial statements for the three month period ended
March 31, 1999, and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 34,598
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 34,598
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 34,598
<CURRENT-LIABILITIES> 2,225
<BONDS> 0
0
0
<COMMON> 11,000
<OTHER-SE> 21,373
<TOTAL-LIABILITY-AND-EQUITY> 34,598
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,292
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,292)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,292)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,292)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
