U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended June 30, 1999
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File No. 0-24374
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LUCAS EDUCATIONAL SYSTEMS, INC.
-----------------------------------
(Name of Small Business Issuer in its Charter)
DELAWARE 62-1690722
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
P. O. Box 789
Templeton, California 93465
---------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (805) 434-3982
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Company 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
--- --- --- ---
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:
June 30, 1999
Common - 12,453,619 shares
DOCUMENTS INCORPORATED BY REFERENCE
A description of any "Documents Incorporated by Reference" is
contained in Item 6 of this Report.
Transitional Small Business Issuer Format Yes X No
--- ---
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Consolidated Financial Statements of the Company required
to be filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes. In the opinion
of management, these Consolidated Financial Statements fairly present the
financial condition of the Company.
<PAGE>
<TABLE>
LUCAS EDUCATIONAL SYSTEMS, INC.
Balance sheet
June 30, 1999 (unaudited) and March 31, 1999 (audited)
<CAPTION>
June 30, March 31,
1999 1999
<S> <C> <C>
ASSETS
Current Assets
Cash in Bank $10,460 $ 89,546
Inventory 5,610 5,610
Related Party receivables 3,000 3,400
Organization costs - -
TOTAL CURRENT ASSETS 19,070 98,556
Property and Equipment, net 66,787 60,144
TOTAL ASSETS 85,857 158,700
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable 21,439 11,438
Accrued liabilites 17,860
Related Party Notes payable 12,000 12,000
TOTAL CURRENT LIABILITIES 51,299 23,438
Stockholders' Equity
Preferred stock $.001 par;
1,000,000 shares authorized,
none issued or outstanding
Common Stock, $.001 par;
20,000,000 shares authorized,
12,453,619 and 12,453,619
issued and outstanding 12,454 12,454
Paid in capital 1,476,436 1,476,436
Unearned compensation (90,000) (106,875)
Retained Earnings Deficit (1,364,332) (1,246,753)
TOTAL STOCKHOLDERS' EQUITY 34,558 135,262
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY 85,857 158,700
</TABLE>
<TABLE>
LUCAS EDUCATIONAL SYSTEMS, INC.
Statement of Operations
<CAPTION>
For the three For the three From inception
months ended months ended December 5, 1996 to
June 30, June 30, June 30,
1999 1998 1999
<S> <C> <C>
Revenues $ - $ - $ -
Expenses
General and Administrative 117,601 87,194 1,362,239
LOSS FOR THE PERIOD (117,601) (87,194) (1,362,239)
Other Income (expenses)
Interest Income 455 - 455
Interest Expense (433) - (2,548)
Net loss before provision for
income taxes (117,579) (87,194) (1,364,332)
Provision for income taxes - - -
Net Loss (117,579) (87,194) (1,364,332)
Net loss per common share-
basic and fully diluted (.009) (.007)
</TABLE>
<TABLE>
LUCAS EDUCATIONAL SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders Equity
From Inception on December 5, 1996 through June 30, 1999
<CAPTION>
Additional
Paid-In
Treasury stock Common Stock Capital
Shares Amount Shares Stock (Deficit)
<S> <C> <C> <C> <C> <C>
Inception at December 5, 1996 - - - $ - $ -
Issuance of common stock at
$0.00125 per share - - 8,700,000 8,700 (8,600)
Net loss from inception on
December 6, 1996 through
March 31, 1997 - - - - -
Balance, March 31, 1997 - - 8,700,000 8,700 (8,600)
Common stock issued in
recapitalization - - 1,849,869 1,850 (1,810)
Common stock issued for
cash and services of
$0.60 per share - - 192,000 192 114,808
Common stock issued for debt
at $0.60 per share - - 333,000 333 199,667
Common stock issued for
services at $0.60 per share - - 168,750 169 101,081
Net loss for the year
ended March 31, 1998 - - - - -
Balance, March 31, 1998 - - 11,243,619 $11,244$405,146
Proceeds from stock subscription - - - - -
receivable
Common stock issued for
cash - - 90,000 90 179,910
debt and other payables - - 400,000 400 299,600
Services - - 720,000 720 364,280
Contributed shares 455,500 - - - -
Treasury stock
issued for cash (455,500) - - - 227,500
Net Loss - - - - -
Balance, March 31, 1999 - - 12,453,619 12,454 1,476,436
Common stock issued for
services - - - - -
Net Loss - - - - -
Balance, June 30, 1999
(unaudited) - - 12,453,619 12,454 1,476,436
</TABLE>
<TABLE>
LUCAS EDUCATIONAL SYSTEMS, INC.
(A Development Stage Company)
Statements of Stockholders Equity
From Inception on December 5, 1996 through June 30, 1999
<CAPTION>
Unearned Stock Sub-
Compen- scription Accumulated
sation receivable Deficit Total
<S> <C> <C> <C> <C>
Inception at December 5, 1996 $ - $ - $ - $ -
Issuance of common stock at
$0.00125 per share - - - 100
Net loss from inception on
December 6, 1996 through
March 31, 1997 - - (63) (63)
Balance, March 31, 1997 - - (63) 37
Common stock issued in
recapitalization - - - 40
Common stock issued for
cash and services of
$0.60 per share - (25) - 114,975
Common stock issued for debt
at $0.60 per share - - - 200,000
Common stock issued for
services at $0.60 per services - - - 101,250
Net loss for the year
ended March 31, 1998 - - (351,181) (351,181)
Balance, March 31, 1998 - $(25)(351,244) 65,121
Proceeds from stock subscription
receivable - 25 - 25
Common stock issued for
cash - - - 180,000
debt and other payables - - - 300,000
Services (106,875) - - 258,125
Contributed shares - - - -
Treasury stock
issued for cash - - - 227,500
Net Loss - - (895,509) (895,509)
Balance, March 31, 1999 (106,875) -(1,246,753) 135,262
(audited)
Common stock issued for
services 16,875 - - -
Net loss - - (117,579) (117,579)
Balance, June 30, 1999
(unaudited) (90,000) -(1,364,332) 34,558
</TABLE>
<TABLE>
LUCAS EDUCATIONAL SYSTEMS, INC.
STATEMENTS OF CASH FLOWS
<CAPTION>
For the three For the three From inception
months ended months ended December 5, 1996 to
June 30, June 30, June 30,
1999 1998 1999
<S> <C> <C> <C>
Cash Flows from Operating Activities:
Net Loss (117,579) (87,194) (1,364,332)
Adjustments to Reconcile Net Loss to
Net Cash Used by Operating Activities:
Amortization and Depreciation 7,146 4,614 34,799
Common Stock Issued for Services - 51,128 374,350
Common Stock Issued for Debt - - 200,000
Changes in Operating Assets and
Liabilities:
Increase (Decrease) in Inventory - - (5,610)
Increase (Decrease) in Related
Party receivables 400 - (3,000)
Increase (Decrease) in deposits - - -
Increase (Decrease) in Accounts
Payable 10,001 (44,506) 306,439
Increase (Decrease) in Accrued
Liabilities 17,860 (9,863) 17,860
Net Cash Provided (Used) by Operating
Activities (82,172) (85,821) (439,494)
Cash Flows from Investing Activities:
Purchase of property and equipment (13,789) - (101,586)
Net Cash Provided (Used) by Investing
Activities (13,789) - (101,586)
Cash Flows from Financing Activities:
Proceeds from related party notes
Payable - 60,000 33,500
Payments on related party notes
payable - - (6,500)
Issance of common stock 16,875 - 524,515
proceeds from stock subscription
receivable - 25 25
Net Cash Provided (Used) by Financing
Activities 16,875 60,025 551,540
Net Increase (Decrease) in cash (79,086) (25,796) 10,460
Cash at Beginning of Period 89,546 37,191 -
Cash at End of Period 10,460 11,395 10,460
</TABLE>
Note to financial statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for a fair
presentation. Such adjustments are of a normal, recurring nature.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
- -----------------
The Company has not engaged in any material operations or
had any revenues from operations during the quarter ended June 30, 1999.
The Company completed a reorganization whereby it acquired all of the
outstanding voting securities of Lucas Educational Systems, Inc., a Nevada
corporation ("Lucas Nevada"), reported in a Form 8-K Current Report dated
November 11, 1997, which has been previously filed with the Securities and
Exchange Commission and which is incorporated herein by reference.
The Company plans in the next twelve months to promote the Company's
product through direct or indirect marketing channels.
The Company will need $500,000 for operations for the next twelve months,
and these funds will need to be raised through debt or equity financing.
Results of Operations.
- ----------------------
At June 30, 1999, the Company had $85,857 in assets and current
liabilities of $51,299. There were no revenues in the three months ended
June 30, 1999, and losses from operations during this period were
($117,579).
Liquidity
- ---------
The Company had cash of $10,460 as of June 30, 1999, with liabilities of
$51,299 for the same period.
"Year 2000"
- -----------
The Company's management has determined that Year 2000 issues will
not materially affect them, because the major activities of the Company are
not dependent on computers that may be subject to Year 2000 issues. With the
exception that the Company does propose to sell their products through the
Internet, which management believes to be Year 2000 compliant.
The Company can give no assurance that third parties with whom it does
business (e.g., banks and utilities) will ensure Year 2000 compliance in a
timely manner or that, if they do not, their computer systems will not have an
adverse effect on the Company. However, the Company does not believe that
Year 2000 compliance issues of such third parties will result in a material
adverse effect on its financial condition or results of operations.
For the foregoing reasons, the Company has determined that the potential
consequences of the Year 2000 would not have a present material effect on its
business, results of operations or financial condition.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 2. Changes in Securities.
None; not applicable.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of the Company's security holders
during the period covered by this Report.
Item 5. Other Information.
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
Exhibit
(a) Exhibits. Number
Annual Report on Form 10-KSB for the year **
ended March 31, 1998, filed August 21, 1998
(b) Reports on Form 8-K.
8-K Current Report, dated November 11, 1997, **
regarding the Plan with Lucas 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 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.
LUCAS EDUCATIONAL SYSTEMS, INC.
Date: 8/18/99 By:/s/Jerry R. Lucas
Jerry R. Lucas
President and Director
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:
LUCAS EDUCATIONAL SYSTEMS, INC.
Date: 8/18/99 By:/s/Jerry R. Lucas
Jerry R. Lucas
President and Director
Date: 8/17/99 By:/s/Cheryl W. Lucas
Cheryl W. Lucas
Treasurer and Director
Date: 8/16/99 By:/s/David Nelson
David Nelson
Secretary and CFO
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-END> JUN-30-1999
<CASH> 10460
<SECURITIES> 0
<RECEIVABLES> 3000
<ALLOWANCES> 0
<INVENTORY> 5610
<CURRENT-ASSETS> 19070
<PP&E> 73933
<DEPRECIATION> 7146
<TOTAL-ASSETS> 85857
<CURRENT-LIABILITIES> 51299
<BONDS> 0
0
0
<COMMON> 12454
<OTHER-SE> 22104
<TOTAL-LIABILITY-AND-EQUITY> 85857
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 117601
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 433
<INCOME-PRETAX> (117579)
<INCOME-TAX> 0
<INCOME-CONTINUING> (117579)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (117579)
<EPS-BASIC> (0.009)
<EPS-DILUTED> (0.009)
