U.S. Securities and Exchange Commission
Washington, DC 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________ to _____________
Commission File No. 0-23498
GRAYSTONE WORLD WIDE, INC.
---------------------------------------------
(Name of Small Business Issuer in its Charter)
DELAWARE 33-0601487
------------------------------- --------------------
(State or Other Jurisdiction of (IRS Employer ID No.)
incorporation or organization)
282 S. Main Street, Suite C-D
Alpharetta, Georgia 30004
---------------------------------------
(Address of Principal Executive Offices)
(770) 619-9420
-----------------------------------------------
(Issuer's Telephone Number, including Area Code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 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.
(1) Yes X No (2) Yes X No
There were 14,782,000 shares of common stock, $.001 par value, outstanding
as of November 13, 1998.
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statement
<TABLE>
GRAYSTONE WORLD WIDE, INC.
Formerly Achiote Corporation
(A Development Stage Company)
Balance Sheets
<CAPTION>
September 30, September 30,
1998 1997
<S> <C> <C>
ASSETS
Current assets
Cash $ 19 $ -
Inventory 687,432 -
Total current assets 687,451 -
Furniture and fixtures, less
accumulated depreciation of $554 and $0 10,846 -
Other assets
Organization costs, net of accumulated
amortization of $286 and $286 - -
Total assets $698,297 $ -
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $ 69,535 $ 956
Note payable - shareholder 174,043 -
Current portion of long-term debt 399,500 -
Total current liabilities 643,078 956
Long-term debt, net of current portion - -
Total liabilities 643,078 956
Stockholders' equity
Preferred stock, $.001 par value;
1,000,000 shares authorized; no
shares issued and outstanding - -
Common stock, $.001 par value;
20,000,000 shares authorized;
14,782,360 shares issued and
outstanding 14,782 425
Additional paid-in capital 295,768 821
Accumulated deficit during the
development stage (255,331) (2,202)
Total stockholders' equity 55,219 (956)
Total liabilities and stockholders'
equity $ 698,297 $ -
</TABLE>
See accompanying notes to financial statements
<TABLE>
GRAYSTONE WORLD WIDE, INC.
Formerly Achiote Corporation
(A Development Stage Company)
Statements of Operations
<CAPTION>
Cumulative
From
For the six Inception
months ended (May 4, 1992)
September 30, to September 30,
1998 1997 1998
<S> <C> <C> <C>
Revenues $ - $ - $ -
Operating expenses
General and administrative 244,530 - 254,491
Depreciation 554 - 554
Amortization - 6 286
Total operating expenses 245,084 6 255,331
Net (loss) $ (245,084) $ (6) $ (255,331)
Net (loss) per share $ (0.02) $ -
Weighted average number of
shares outstanding 14,721,158 1,160,200
</TABLE>
See accompanying notes to financial statements
<TABLE>
GRAYSTONE WORLD WIDE, INC.
Formerly Achiote Corporation
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
April 1, 1995 Through September 30, 1998
<CAPTION>
Accumulated
Deficit
Common Stock Additional During the
Paid-In Development
Shares Amount Capital Stage Total
<S> <C> <C> <C> <C> <C>
Balance, April 1, 1995 1,160,200 $ 1,160 $ 1,042 $(1,554) $ 648
Retroactively Restated
Net (loss) - - - (430) (430)
Balance, March 31, 1996 1,160,200 $ 1,160 $ 1,042 $(1,984) $ 218
Net (loss) - - - (212) (212)
Balance, March 31, 1997 1,160,200 1,160 1,042 (2,196) 6
Shares issued to acquire 100%
of the outstanding shares of
Graystone World Wide, Inc.12,787,398 12,787 (12,787) - -
Shares issued for services
$0.01 per share 734,762 735 6,613 (7,348) -
Contribution to capital - - 1,000 - 1,000
Net (loss) - - - (703) (703)
Balance, March 31, 1998 14,682,360 $14,682 $(4,132) $(10,247) $ 303
Contributions to capital - - 462,000 - 462,000
Net (loss) - - - (56,962) (56,962)
Balance, September
30, 1998 14,682,360 $14,682 $457,868 $(67,209) $405,341
</TABLE>
See accompanying notes to financial statements
<TABLE>
GRAYSTONE WORLD WIDE, INC.
Formerly Achiote Corporation
(A Development Stage Company)
Statements of Cash Flows
<CAPTION>
Cumulative
From
For the six Inception
months ended (May 4, 1992)
September 30, to September 30,
1998 1997 1998
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $ (245,084) $ (6) $ (255,331)
Add items not requiring the use of
cash Amortization - 6 286
Depreciation 554 - 554
Increase in inventory (687,432) - (687,432)
Increase in accounts payable 68,858 - 69,535
Net cash flows from operating
activities (863,104) - (872,388)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of furniture and fixtures (11,400) - (11,400)
Organization costs - - (286)
Net cash flows from investing
activities (11,400) - (11,686)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt 557,000 - 557,000
Proceeds from shareholder loan 226,639 - 226,639
Payments on long-term debt (157,500) - (157,500)
Payments on shareholder loan (52,596) - (52,596)
Contribution to capital 299,900 - 295,768
Sale of common stock 100 - 14,782
Net cash flows from financing
activities 873,543 - 884,093
Net increase/(decrease) in cash (961) - 19
Cash balance at beginning of period 980 - -
Cash balance at end of period $ 19 $ - $ 19
</TABLE>
See accompanying notes to financial statements
GRAYSTONE WORLD WIDE, INC.
Formerly Achiote Corporation
(A Development Stage Company)
Notes to Financial Statements
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Graystone World Wide, Inc. (the "Company") was incorporated under the
laws of the State of Nevada on January 18, 1998. The stated purpose of
the Company is to engage without qualification, in any lawful acts, or
activity for which a corporation may be organized under the laws of the
state of Nevada. Achiote Corporation was incorporated under the laws of
the State of Delaware on May 4, 1992, for the purpose of seeking out
business opportunities, including acquisitions.
On March 20, 1998, the Company entered into an Agreement and Plan of
Reorganization with Achiote Corporation, wherein it was agreed that
Graystone World Wide, Inc. (a Nevada corporation) would issue 12,787,398
shares of its common stock to acquire 100% of the issued and outstanding
shares of stock of Achiote Corporation (a Delaware Corporation).
Prior to the reorganization, the sole director of Achiote Corporation
exercised his right to covert amounts owed by Achiote into 155,000 shares
of common stock. Also, prior to the reorganization, Achiote forward
split its outstanding shares 2 shares for 1 on March 20, 1998. As a
consequence of this action, Achiote Corporation had 1,160,200 shares
issued and outstanding prior to the Agreement and Plan of Reorganization
in which Achiote Corporation was acquired.
Method of Accounting
The Company uses the accrual method of accounting.
Cash and Cash Equivalents
The Company considers all short-term investments with an original
maturity of three months or less to be cash equivalents.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those
estimates.
2. INCOME TAXES
The fiscal year end of the Company is March 31st and an income tax return
has not been filed. However, if an income tax return had been filed, the
Company would have a net operating loss carry forward of $10,247 that
would begin expiring in the year 2009.
3. NOTE PAYABLE - SHAREHOLDER
During the period ended September 30, 1998, a company owned by a major
shareholder advanced the Company funds. The note is a demand note that
is non-interest bearing. The balance at September 30, 1998 is $174,043.
4. LONG-TERM DEBT
The long-term debt consists of the following at September 30, 1998:
1998 1997
Note payable to a financial institution;
a demand note that is non-interest
bearing $ 399,500 $ -
Total long-term debt 399,500 -
Less current portion (399,500) -
Long-term debt $ - $ -
Item 2. Management's Discussion and Analysis and Plan of Operations.
Plan of Operation
While maintaining its core markets, and strengthening its
relationship with large domestic retailers, the Company will initiate planned
mergers with and/or acquisition of certain targeted niche-market companies
with established markets, assets and core management in the footwear field.
The Company's primary objective is to generate $38 million in gross revenues
in 1998 by developing the Company's core subsidiaries and joint-venturing with
other companies with an emphasis in footwear manufacturing. The Company
has entered into discussions with several investment bankers and is preparing
for a planned secondary public offering of its common stock, concurrent with
an application for listing on NASDAQ.
The foregoing is based upon "forward looking" information, and assumes
the acquisition of an entity currently being managed by the Company and which
manufactures footwear under the Company's name, as to which no assurance can
be given.
Results of Operations
- ---------------------
Revenues for the quarter ended September 30, 1998 were $0.
The Company had a net loss of ($245,084) for the six months ended
September 30, 1998 and ($6) for the six months ended September 30, 1997.
Liquidity
- ---------
For the six months ended September 30, 1998, the Company and its
subsidiaries had total expenses of $245,084, while receiving $0 in revenues.
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) EXHIBIT
Annual Report on Form 10 - KSB for the year **
ended March 31, 1998, filed August 19, 1998
(b) REPORTS ON FORM 8-K
SEC Form 8-K, dated March 26, 1998, Regarding **
the Plan with Graystone Nevada
** These documents and related exhibits have been previously filed
with the Securities and Exchange Commission and by this reference are
incorporated herein.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized.
GRAYSTONE WORLD WIDE, INC.
Date: /98 By/s/Donald J. Hallisy
-----------------------------
Donald J. Hallisy
Director and President
Date: /98 By/s/John L. Melcher
-----------------------------
John L. Melcher
Vice President and Treasurer
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf
of the Registrant and in the capacities and on the dates indicated:
GRAYSTONE WORLD WIDE, INC.
Date: /98 By/s/Donald J. Hallisy
------------------------------
Donald J. Hallisy
Director and President
Date: /98 By/s/John L. Melcher
------------------------------
John L. Melcher
Vice President and Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 19
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 687432
<CURRENT-ASSETS> 687451
<PP&E> 11400
<DEPRECIATION> 554
<TOTAL-ASSETS> 698297
<CURRENT-LIABILITIES> 643078
<BONDS> 0
0
0
<COMMON> 14782
<OTHER-SE> 40437
<TOTAL-LIABILITY-AND-EQUITY> 698297
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 245084
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (245084)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (245084)
<EPS-PRIMARY> 0.02
<EPS-DILUTED> 0.02
</TABLE>
