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, 2000
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
incorporation or organization) No.)
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, 2000
Common Stock 11,000,000
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
BIOETHICS, LTD.
[A Development Stage Company]
UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2000
2
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
CONTENTS
PAGE
Accountants' Review Report 4
Unaudited Condensed Balance Sheets, March 31,
2000 and December 31, 1999 5
Unaudited Condensed Statements of Operations,
for the three months ended March 31, 2000 and
1999 and for the period from inception on July 26,
1990 through March 31, 2000 6
Unaudited Condensed Statements of Cash Flows,
for the three months ended March 31, 2000 and
1999 and for the period from inception on July 26,
1990 through March 31, 2000 7
Notes to Unaudited Condensed Financial Statements 8 - 10
3
<PAGE>
ACCOUNTANTS' REVIEW REPORT
Board of Directors
BIOETHICS, LTD.
South Weber, Utah
We have reviewed the accompanying condensed balance sheet of Bioethics, LTD.
(A Development Stage Company) as of March 31, 2000, and the related condensed
statements of operations and cash flows for the three months ended March 31,
2000 and 1999, and for the period from inception on July 26, 1990 through
March 31, 2000. All information included in these financial statements is the
representation of the management of Bioethics, LTD..
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review consists
principally of inquiries of Company personnel and analytical procedures
applied to financial data. It is substantially less in scope than an audit in
accordance with generally accepted auditing standards, the objective of which
is the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the condensed financial statements reviewed by us, in order
for them to be in conformity with generally accepted accounting principles.
/S/Pritchett, Siler & Hardy, P.C.
PRITCHETT, SILER & HARDY, P.C.
April 27, 2000
Salt Lake City, Utah
4
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BIOETHICS, LTD.
[A Development Stage Company]
CONDENSED BALANCE SHEETS
[Unaudited - See Accountants' Review Report}
ASSETS
March 31, December 31,
2000 1999
___________ ___________
CURRENT ASSETS:
Cash in bank $ 27,777 $ 29,804
___________ ___________
Total Current Assets 27,777 29,804
___________ ___________
$ 27,777 $ 29,804
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,760 $ 670
___________ ___________
Total Current Liabilities 1,760 670
___________ ___________
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value,
5,000,000 shares authorized,
0 shares issued and outstanding - -
Common stock, $.001 par value,
20,000,000 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 (14,983) (11,866)
___________ ___________
Total Stockholders' Equity 26,017 29,134
___________ ___________
$ 27,777 $ 29,804
___________ ___________
Note: The Balance Sheet as of December 31, 1999, 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.
5
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
CONDENSED STATEMENTS OF OPERATIONS
[Unaudited - See Accountants' Review Report]
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
____________________ March 31,
2000 1999 2000
__________ ________ ________
REVENUE $ - $ - $ -
EXPENSES:
General and Administrative (3,117) (2,292) (14,983)
__________ ________ ________
LOSS BEFORE INCOME TAXES (3,117) (2,292) (14,983)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
__________ ________ ________
NET LOSS $ (3,117) $(2,292) $(14,983)
__________ ________ ________
LOSS PER COMMON SHARE $ (.00) $ (.00) $ (.01)
__________ ________ ________
The accompanying notes are an integral part of these unaudited condensed
financial statements.
6
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
CONDENSED STATEMENTS OF CASH FLOWS
[Unaudited - See Accountants' Review Report]
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
____________________ March 31,
2000 1999 2000
__________ ________ ________
Cash Flows From Operating
Activities:
Net loss $ (3,117) $ (2,292) $(14,983)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Changes is assets and liabilities:
Increase in accounts payable 1,090 1,326 1,760
__________ ________ ________
Net Cash (Used) by
Operating Activities (2,027) (966) (13,223)
__________ ________ ________
Cash Flows From Investing
Activities - - -
__________ ________ ________
Net Cash Provided by Investing
Activities - - -
__________ ________ ________
Cash Flows From Financing
Activities:
Proceeds from issuance of common
stock - - 41,000
__________ ________ ________
Net Cash Provided by Financing
Activities - - 41,000
__________ ________ ________
Net Increase (Decrease) in Cash (2,027) (966) 27,777
Cash at Beginning of Period 29,804 35,564 -
__________ ________ ________
Cash at End of Period $ 27,777 $ 34,598 $ 27,777
__________ ________ ________
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 periods ended March 31, 2000 and 1999
None
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Bioethics, Ltd. (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, 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 December 31, 1999
audited financial statements. the results of operations for the periods ended
March 31, 2000 are not necessarily indicative of the operating results for the
full year.
Loss Per Share - The computation of loss per share is based on the weighted
average number of shares outstanding during the period presented in accordance
with statement of Financial Standard 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.
Accounting Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosures of contingent assets and liabilities at the date
of the financial statements, and the reported amount of revenues and expenses
during the reported period. Actual results could differ from those estimated.
Recently Enacted Accounting Standards - Statement of Financial Accounting
Standards (SFAS) No. 132, "Employer's Disclosure about Pensions and Other
Postretirement Benefits", SFAS No. 133, "Accounting for Derivative Instruments
and Hedging Activities", SFAS No. 134, "Accounting for Mortgage-Backed
Securities.", SFAS No. 135 "Rescission of FASB Statement No. 75 and Technical
Corrections", SFAS No. 136, "Transfers of Assets to a not for profit
organization or charitable trust that raises or holds contributions for
others, " and 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)," were recently issued. SFAS No.
132, 133, 134, 135, 136, and 137 have no current applicability to the Company
or their effect on the financial statements would not have been significant.
8
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BIOETHICS, LTD.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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, 2000, the Company has available unused
operating loss carryforwards of approximately $8,500, which may be applied
against future taxable income and which expire in 2005 through 2020.
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 and,
therefore, no deferred tax asset has been recognized for the loss
carryforwards. The net deferred tax assets are approximately $4,900 as of
March 31, 2000, with an offsetting valuation allowance at each period end of
the same amount resulting in a change in the valuation allowance of
approximately $1,100 during the three months ended March 31, 2000.
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.
9
<PAGE>
BIOETHICS, LTD.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED 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 periods presented:
For the Three From Inception
Months Ended on July 26,
March 31, 1990 Through
_____________________ March 31,
2000 1999 2000
_________ ________ _________
Income (loss) available to
common stockholders used
in income (loss) per share
(Numerator) $(3,117) $(2,292) $(14,983)
_________ ________ ________
Weighted average number of
common shares outstanding
used in earnings per share
during the period
(Denominator) 11,000,000 11,000,000 2,979,638
____________ ___________ __________
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.
10
<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-QSB 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.
11
<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.
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 5, 2000 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 three month period ended March 31, 2000, and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 27,777
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 27,777
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 27,777
<CURRENT-LIABILITIES> 1,760
<BONDS> 0
0
0
<COMMON> 11,000
<OTHER-SE> 15,017
<TOTAL-LIABILITY-AND-EQUITY> 27,777
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,117
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,117)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,117)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,117)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
