<PAGE>
<PAGE> 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 quarterly period ended June 30, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________________ to __________________
Commission File No. 0-24688
G/O INTERNATIONAL, INC.
-----------------------
(Name of Small Business Issuer in its Charter)
COLORADO 76-0025986
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
11849 Wink
Houston, Texas 77024
---------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (713) 783-1204
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
--- --- --- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
N/A
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the Registrant's classes
of common stock, as of the latest practicable date:
July 28, 1999
Common Voting Stock - 6,215,372 shares
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
---------------------
The Financial Statements of the Registrant required to be filed with
this 10-QSB Quarterly Report were prepared by management and commence below,
together with related Notes. In the opinion of management, the Financial
Statements fairly present the financial condition of the Registrant.
<TABLE>
G/O INTERNATIONAL, INC.
(A Development Stage Company)
Consolidated Balance Sheet
<CAPTION>
ASSETS
June 30, December 31,
1999 1998
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 3,956 $ 32,129
Accounts receivable - 754
Total Current Assets 3,956 32,883
OTHER ASSETS
Horses - 136,900
Total Other Assets - 136,900
TOTAL ASSETS $ 3,956 $ 169,783
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 58 $ 23,890
Accrued interest - 10,880
Advances from stockholders 14,385 14,385
Notes payable - related parties - 165,000
Total Current Liabilities 14,443 214,155
MINORITY INTEREST - 48,765
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.01 par value, 20,000,000 shares
authorized; 6,215,372 shares issued and outstanding 62,154 62,154
Additional paid-in capital 2,466,224 2,378,426
Accumulated deficit prior to the development
stage (2,330,609) (2,330,609)
Deficit accumulated during the development stage (208,256) (203,108)
Total Stockholders' Equity (Deficit) (10,487) (93,137)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 3,956 $ 169,783
</TABLE>
<TABLE>
G/O INTERNATIONAL, INC.
(A Development Stage Company)
Consolidated Statements of Operations
(Unaudited)
<CAPTION>
From
Inception on
For the For the January 1,
Six Months Ended Three Months Ended 1991 to
June 30, June 30, June 30,
1999 1998 1999 1998 1999
<S> <C> <C> <C> <C> <C>
REVENUES
Sales $ - $ 77,850 $ - $ 7,850 $ 189,425
Cost of Sales - 27,100 - - 124,130
Gross Profit - 50,750 - 7,850 65,295
EXPENSES
General and
administrative 5,148 69,588 4,630 37,044 331,780
Total Expenses 5,148 69,588 4,630 37,044 331,780
NET LOSS FROM
OPERATIONS (5,148) (18,838) (4,630)(29,194) (266,485)
OTHER INCOME (EXPENSE)
Interest income - - - - 58
Interest expense - (5,637) - (2,886) (12,772)
Total Other Income
(Expense) - (5,637) - (2,886) (12,714)
MINORITY INTEREST - 8,708 - 3,385 70,943
NET LOSS $ (5,148) $(15,767) $ (4,630)(28,695)$(208,256)
LOSS PER SHARE $ (0.00) $ (0.00) $ (0.00)$ (0.00)
</TABLE>
<TABLE>
G/O INTERNATIONAL, INC.
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity (Deficit)
<CAPTION>
Additional
Common Stock Paid-in Accumulated
Shares Amount Capital Deficit
<S> <C> <C> <C> <C>
Balance, January 1, 1991
(inception of development stage) 323,866 $3,239 $2,321,443 $(2,330,609)
Net loss for the year ended
December 31, 1991 - - - (72)
Balance, December 31, 1991 323,866 3,239 2,321,443 (2,330,681)
Net loss for the year ended
December 31, 1992 - - - (1,466)
Balance, December 31, 1992 323,866 3,239 2,321,443 (2,332,147)
Net loss for the year ended
December 31, 1993 - - - (1,678)
Balance, December 31, 1993 323,866 3,239 2,321,443 (2,333,825)
Shares issued to directors in
lieu of services rendered and
offset of advances, 1,500,000
shares at $0.01 per share on
May 6, 1994 1,500,000 15,000 - -
Issuance of shares for legal
services at $0.01 per share on
July 26, 1994 150,000 1,500 - -
Net loss for the year ended
December 31, 1994 - - - (24,350)
Balance, December 31, 1994 1,973,866 19,739 2,321,443 (2,358,175)
Shares returned back to the
Company and canceled in
February 1995 (18,494) (185) 185 -
Issuance of shares for cash,
October 23, 1996 at $0.01
per share 2,000,000 20,000 - -
Shares issued to directors
in lieu of services rendered,
November 1995 at $0.01 per share 30,000 300 - -
Net loss for the year ended
December 31, 1995 - - - (4,095)
Balance, December 31, 1995 3,985,372 39,854 2,321,628 (2,362,270)
Issuance of 2,000,000 shares
for cash, March 12, 1996
at $0.01 2,000,000 20,000 - -
Issuance of 50,000 shares for
services on October 31, 1996
at $0.01 per share 50,000 500 - -
Liquidating dividend - - (6,400) -
Net loss for the year ended
December 31, 1996 - - - (25,510)
Balance, December 31, 1996 6,035,372 60,354 2,315,228 (2,387,780)
Issuance of 40,000 shares for
cash on October 2, 1997
at $0.25 per share 40,000 400 9,600 -
Issuance of 60,000 shares for
services on October 29, 1997
at $0.01 per share 60,000 600 14,400 -
Net loss for the year ended
December 31, 1997 - - - (42,821)
Balance, December 31, 1997 6,135,372 61,354 2,339,228 (2,430,601)
Issuance of shares for cash
on August 17, 1998 at $0.50
per share 20,000 200 9,800 -
Issuance of shares for
services on October 29,
1998 at $0.50 per share 60,000 600 29,400 -
Net loss for the year ended
December 31, 1998 - - - (103,116)
Balance, December 31, 1998 6,215,372 $ 62,154 $2,387,426 $(2,533,717)
Capital recognized from subsidiary
(unaudited) - - 87,798 -
Net loss for the six months ended
June 30, 1999 (unaudited) - - - (5,148)
Balance, March 31, 1999
(unaudited) 6,215,372 $ 62,154 $2,466,224 $(2,538,865)
</TABLE>
<TABLE>
G/O INTERNATIONAL, INC.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
<CAPTION>
From
Inception on
For the For the January 1,
Six Months Ended Three Months Ended 1991 to
June 30, June 30, June 30,
1999 1998 1999 1998 1999
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $(5,148) $ (15,767) $(4,630) $(28,695) $(208,256)
Reconciliation of
net loss to cash
provided (used) in
operating activities:
Common stock issued
in lieu of
services rendered
and offset of
advances - - - - 62,300
Amortization expense - - - - 1,280
Minority interest - (9,503) - (3,385) (53,173)
(Increase) decrease
in prepaid expenses - - - - 1,920
(Increase) decrease
in organization
costs - 960 - - -
Increase (decrease)
in accounts
receivable - - - 70,000 (754)
Increase (decrease)
in accounts payable - 15,251 - 751 17,959
(Increase) decrease
in accrued expenses - (165) - - 10,880
Increase (decrease)
in advances from
stockholders - 105,000 - 2,500 14,385
Net Cash Provided
(Used) by Operating
Activities (5,148) 95,776 (4,630) 41,171 (153,459)
CASH FLOWS FROM
INVESTING ACTIVITIES
Purchase of
investments - - - - (69,400)
(Increase) decrease
of horses - (34,000) - - (70,700)
Net Cash Provided
(Used) by Investing
Activities $ - $ (34,000) $ - $ - $ (140,100)
CASH FLOWS FROM
FINANCING ACTIVITIES
Disposition of cash
from Waterbury $(23,025)$ - $ - $ - $ (23,025)
Proceeds from notes
payable - related
parties - - - - 210,000
Payments on notes
payable - related
parties - - - - (45,000)
Payment of dividend - - - - (6,400)
Cash from minority
shareholders - - - - 101,940
Cash from sales of
stock - - - - 60,000
Net Cash Provided
(Used) from
Financing
Activities (23,025) - - - 297,515
NET CHANGE IN CASH (28,173) 61,776 (4,630) 41,171 3,956
CASH AT BEGINNING OF
PERIOD 32,129 9,848 8,586 30,453 -
CASH AT END OF PERIOD $3,956 $71,624 $ 3,956 $ 71,624 $ 3,956
CASH PAID FOR:
Interest $ - $ - $ - $ - $ 1,333
Income taxes $ - $ - $ - $ - $ -
NON-CASH ITEMS
Common stock issued
in lieu of services
rendered and
offset or advances $ - $ - $ - $ - $ 32,300
Common stock returned
and canceled $ - $ - $ - $ - $ 185
Capital reorganized
from subsidiary $87,798 $ - $ - $ - $ 87,798
</TABLE>
G/O INTERNATIONAL, INC.
(A Development Stage Company)
Notes to the Unaudited Consolidated Financial Statements
June 30, 1999 and December 31, 1998
NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated 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 June
30, 1999 and for all periods presented have been made.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with general
accepted accounting principles have been condensed or omitted. It is
suggested that these condensed consolidated financial statements be read in
conjunction with the financial statements and notes thereto included in the
Company's December 31, 1998 audited consolidated financial statements. The
results of operations for the periods ended June 30, 1999 and 1998 are not
necessarily indicative of the operating results for the full year.
NOTE 2 - EQUITY INVESTMENT
As of June 30, 1999, the Company owned 42% of Waterbury Resources, Inc.
As such, Waterbury has not been consolidated in the June 30, 1999 financial
statements. The equity investment has been recorded at zero. The Company
recorded an addition to additional paid-in capital of $78,817 in conjunction
with the non-consolidation of Waterbury.
Item 2. Management's Discussion and Analysis or Plan of Operation.
----------------------------------------------------------
Plan of Operation.
- ------------------
As of June 30, 1999, the Company owned 42% of Waterbury Resources,
Inc. ("Waterbury"). Previously, all of the revenue received by the Company
was generated by Waterbury, which was a 50.7% owned subsidiary of the Company.
The Company intends to continue to seek out the acquisition of assets,
property or business that may be beneficial to the Company and its
stockholders.
Results of Operations.
- ----------------------
The Company discontinued its operations on approximately December
15, 1989. During the quarterly period ended June 30, 1999, the Company
received revenues of $0.
Taking into account general and administrative expenses of $5,148
and costs of sales of $0, the Company had a net loss from operations of
($5,148) during this period, as compared to a net loss from operations of
($18,838) during the quarterly period ended June 30, 1998.
Liquidity
- ---------
The Company had $3,956 in cash for the period ended June 30, 1999.
During the period ended June 30, 1999, the Company and its subsidiaries had
total expenses of $5,148, while receiving $0 in revenues.
Year 2000
- ---------
The Company presently has no material operations, and is presently
seeking a suitable candidate for a merger or acquisition transaction. Due to
its very limited activities and assets, management does not believe that the
change of year to the year 2000 will have any material effect on its business,
results of operations or financial condition.
In seeking out a merger or acquisition target, the Company will take
into account the ways in which the Year 2000 may materially affect the
operations of any such target. However, until such an entity has been
identified, management can not accurately predict how (if at all) the Year
2000 issue may affect the operations of the reorganized Company. At such time
as the Company completes such a reorganization, it will timely disclose all
material Year 2000 issues in the appropriate filing with the Securities and
Exchange Commission.
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.
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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.
----------------------------------------------------
None; not applicable.
Item 5. Other Information.
------------------
On February 10, 1999, the Board of Directors of Waterbury resolved
to offer 200,000 ordinary shares, par value of $0.0001 per share, to
"accredited investors" and/or "sophisticated investors" pursuant to Rule 504,
in consideration of the sum of $0.25 per share for an aggregate total of
$50,000. Prior to the stock offering, there were 1,014,000 outstanding shares
of Waterbury, 513,999 of which were owned by the Company (approximately 50%),
and the remainder of which are owned by eight foreign corporations organized
under the laws of the Cayman Islands, BWI. With 200,000 shares being sold
pursuant to the offering, there were 1,214,000 outstanding shares, and
Waterbury was no longer a majority owned subsidiary of the Company as the
Company's ownership has decreased to approximately 42% of Waterbury.
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a) Exhibits.
None.
(b) Reports on Form 8-K.
None.
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.
G/O INTERNATIONAL, INC.
Date: 7/28/99 By/s/Jack Burns
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Jack Burns, Director
President and Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 3956
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3956
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3956
<CURRENT-LIABILITIES> 14443
<BONDS> 0
0
0
<COMMON> 62154
<OTHER-SE> (72641)
<TOTAL-LIABILITY-AND-EQUITY> 3956
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5148
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5148)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5148)
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
