10QSB 1 0001.txt SEPTEMBER 2000 10-QSB HOLOGRAPHIC SYSTEMS, INC. U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-QSB (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2000 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File number: 0-30689 HOLOGRAPHIC SYSTEMS, INC. (Exact name of registrant as specified in charter) Nevada 84-0989940 (State or other jurisdiction of (I.R.S. Employer I.D. No.) incorporation or organization) 4685 S. Highland Dr., Suite 202, Salt Lake City, UT 84117 (Address of principal executive offices) (Zip Code) Issuer's telephone number, including area code: 801-274-1011 Not Applicable (Former name, address and fiscal year, if changed since last report) 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 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 CORPORATE REGISTRANTS State the number of shares outstanding of each of the issuer's classes of common equity, as of September 30, 2000: 186,964 shares of common stock APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d)of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ] Transitional Small Business Format: Yes [ ] No [X] Documents incorporated by reference: None FORWARD-LOOKING INFORMATION THIS FORM 10QSB AND OTHER STATEMENTS ISSUED OR MADE FROM TIME TO TIME BY THE COMPANY OR ITS REPRESENTATIVES CONTAIN STATEMENTS WHICH MAY CONSTITUTE "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF THE SECURITIES ACT OF 1933 AND THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED BY THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, 15 U.S.C.A. SECTIONS 77Z-2 AND 78U-5. THOSE STATEMENTS INCLUDE STATEMENTS REGARDING THE INTENT, BELIEF OR CURRENT EXPECTATIONS OF THE COMPANY AND MEMBERS OF ITS MANAGEMENT TEAM AS WELL AS THE ASSUMPTIONS ON WHICH SUCH STATEMENTS ARE BASED. PROSPECTIVE INVESTORS ARE CAUTIONED THAT ANY SUCH FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, AND THAT ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTEMPLATED BY SUCH FORWARD-LOOKING STATEMENTS. IMPORTANT FACTORS CURRENTLY KNOWN TO MANAGEMENT THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE IN FORWARD- LOOKING STATEMENTS ARE SET FORTH HEREIN. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS TO REFLECT CHANGED ASSUMPTIONS, THE OCCURRENCE OF UNANTICIPATED EVENTS OR CHANGES TO FUTURE OPERATING RESULTS OVER TIME. PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS The accompanying balance sheets of Holographic Systems, Inc. (a development stage company) at September 30, 2000 and December 31 1999, and the related statements of operations for the three and nine months ended September 30, 2000 and 1999 and the period January 1, 2000 to September 30, 2000, the statement of cash flows for the nine months ended September 30, 2000 and 1999, and the period January 1, 2000 to September 30, 2000, have been prepared by the Company's management and they include all information and notes to the financial statements necessary for a complete presentation of the financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the quarter ended September 30, 2000, are not necessarily indicative of the results that can be expected for the year ending December 31, 2000. HOLOGRAPHIC SYSTEMS, INC. ( Development Stage Company ) BALANCE SHEETS September 30, 2000 and December 31, 1999
Sept 30, Dec 31, 2000 1999 ------- ------- ASSETS CURRENT ASSETS Cash $ - $ 483 -------- -------- Total Current Assets $ - $ 483 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES $ - $ 2,000 ------- -------- Total Current Liabilities - 2,000 ------- -------- STOCKHOLDERS' EQUITY Common stock 100,000,000 shares authorized, at $.001 par value; 186,964 issued and outstanding on September 30; 136,864 on December 31 187 137 Capital in excess of par value 793,821 791,204 Deficit accumulated during development stage (794,008) (792,858) -------- -------- Total Stockholders' Equity (Deficiency) $ - $ (1,517) -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ - $ 483 ======== ========
The accompanying notes are an integral part of these financial statements. HOLOGRAPHIC SYSTEMS, INC. ( Development Stage Company ) STATEMENTS OF OPERATIONS For the Three and Nine Months Ended September 30, 2000 & 1999 and the Period January 1, 2000 (Date of Inception of Development Stage) to September 30, 2000
Three Months Nine Months Jan 1, 2000 Sep 30, Sep 30, Sep 30, Sep 30, to 2000 1999 2000 1999 Sep 30, 2000 -------- -------- ------- ------- ----------- REVENUE $ - $17,240 $ - $54,360 $ - EXPENSES - 18,969 1,150 57,165 1,150 ------ ------ ------ ------ ------ NET LOSS $ - $(1,729) $(1,150) $(2,805) $(1,150) ====== ====== ======= ====== ====== NET LOSS PER COMMON SHARE Basic $ - $ - $ (0.01) $ (0.01) AVERAGE OUTSTANDING SHARES Basic 186,964 136,864 186,964 136,964 ------- ------- ------- -------
The accompanying notes are an integral part of these financial statements. Holographic Systems, Inc. ( Development Stage Company ) STATEMENT OF CASH FLOWS (Unaudited) For the Nine Months Ended September 30, 2000 & 1999 and the Period January 1, 2000 to September 30, 2000 (Date of Inception of Development Stage)
Jan 1, 2000 Sep 30, Sep 30, to Sep 30, 2000 1999 2000 ------- ------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss $(1,150) $(2,805) $(1,150) Adjustments to reconcile net loss to net cash provided by operating activities: Changes in accounts payable (2,000) 2,805 (2,000) Issuance of capital stock and contributions to capital - expenses 2,667 - 2,667 ------ ----- ----- Net Cash Used in Operations (483) - (483) ------ ----- ----- CASH FLOWS FROM INVESTING ACTIVITIES - - - ------ ----- ----- CASH FLOWS FROM FINANCING ACTIVITIES - - - ------ ----- ----- Net Increase (Decrease) in Cash (483) - (483) Cash at Beginning of Period 483 - 483 ------ ----- ------ Cash at End of Period $ - $ - $ - ====== ===== ====== NON CASH FLOWS FROM OPERATING ACTIVITIES Issuance of 50,000 common shares for services $1,000 ----- Contributions to capital - expenses - related party 1,495 -----
The accompanying notes are an integral part of these financial statements. HOLOGRAPHIC SYSTEMS , INC. NOTES TO FINANCIAL STATEMENTS ======================================================================= 1. ORGANIZATION The Company was incorporated under the laws of the State of Colorado on May 16, 1985 with the name of "Mountain Ashe, Inc." with authorized common stock of 100,000,000 shares with a par value of $0.0001. On September 23, 1987 the was name changed to "Holographic Systems, Inc." and on February 7, 2000 the domicile was changed to the state of Nevada in connection with a change in par value to $0.001. On February 7, 2000 the Company completed a reverse common stock split of one share for 20 outstanding shares. This report has been prepared showing after stock split shares with a par value of $.001 from inception. The Company has been in the business of marketing PC computers and accessories and during 1999 ceased operations. After 1999 the Company is considered to be a development stage company. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Methods The Company recognizes income and expenses based on the accrual method of accounting. Dividend Policy The Company has not adopted a policy regarding payment of dividends. Income Taxes At September 30, 2000 the Company had a net operating loss carry forward of $794,008. The tax benefit from the loss carry forward has been fully offset by a valuation reserve because the use of the future tax benefit is undeterminable since the Company has no operations. The net operating loss will expire starting in 2001 through 2021. Basic and Diluted Net Income (Loss) Per Share Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been issued on the exercise of the preferred share rights unless the exercise becomes antidilutive and then only the basic per share amounts are shown in the report. Financial Instruments The carrying amounts of financial instruments, including cash and accounts payable, are considered by management to be their estimated fair values. Comprehensive Income The Company adopted Statement of Financial Accounting Standards No. 130. The adoption of this standard had no impact on the total stockholder's equity. Recent Accounting Pronouncements The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements. Estimates and Assumptions Management uses estimates and assumptions in preparing financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements. 3. GOING CONCERN The Company intends to acquire interests in various business opportunities which, in the opinion of management, will provide a profit to the Company, however there is insufficient working capital for any future planned activity. Continuation of the Company as a going concern is dependent upon obtaining additional working capital and the management of the Company has developed a strategy, which it believes will accomplish this objective through additional equity funding and long term debt which will enable the Company to conduct operations for the coming year. ITEM 2. PLAN OF OPERATIONS MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION Plan of Operation The Company is seeking to acquire assets or shares of an entity actively engaged in business which generates revenues. The Company has no particular acquisitions in mind and has not entered into any negotiations regarding such an acquisition. None of the Company's officers, directors, promoters or affiliates have engaged in any substantive contact or discussions with any representative of any other company regarding the possibility of an acquisition or merger between the Company and such other company as of the date of this quarterly report. The Board of Directors intends to obtain certain assurances of value of the target entity's assets prior to consummating such a transaction. Any business combination or transaction will likely result in a significant issuance of shares and substantial dilution to present stockholders of the Company. The Company has, and will continue to have, no capital with which to provide the owners of business opportunities with any significant cash or other assets. However, management believes the Company will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. The owners of the business opportunities will, however, incur significant legal and accounting costs in connection with the acquisition of a business opportunity, including the costs of preparing Form 8-K's, 10-KSB's, 10- QSB's, agreements and related reports and documents. Liquidity and Capital Resources The Company remains in the development stage and, since inception, has experienced no significant change in liquidity or capital resources or stockholder's equity. The Company's balance sheet as of September 30, 2000, reflects a total asset value of $0.00. The Company has no cash or line of credit, other than that which present management may agree to extend to or invest in the Company, nor does it expect to have one before a merger is effected. The Company will carry out its plan of business as discussed above. The Company cannot predict to what extent its liquidity and capital resources will be diminished prior to the consummation of a business combination or whether its capital will be further depleted by the operating losses (if any) of the business entity which the Company may eventually acquire. Results of Operations During the period from January 1, 2000 through September 30, 2000, the Company has engaged in no significant operations other than maintaining its reporting status with the SEC and seeking a business combination. No revenues were received by the Company during this period. For the current fiscal year, the Company anticipates incurring a loss as a result of legal and accounting expenses, and expenses associated with locating and evaluating acquisition candidates. The Company anticipates that until a business combination is completed with an acquisition candidate, it will not generate revenues, and may continue to operate at a loss after completing a business combination, depending upon the performance of the acquired business. Need for Additional Financing Based upon current management's willingness to extend credit to the Company and/or invest in the Company until a business combination is completed, the Company believes that its existing capital will be sufficient to meet the Company's cash needs required for the costs of compliance with the continuing reporting requirements of the Securities Exchange Act of 1934, as amended, and for the costs of accomplishing its goal of completing a business combination, for an indefinite period of time. Accordingly, in the event the Company is able to complete a business combination during this period, it anticipates that its existing capital will be sufficient to allow it to accomplish the goal of completing a business combination. There is no assurance, however, that the available funds will ultimately prove to be adequate to allow it to complete a business combination, and once a business combination is completed, the Company's needs for additional financing are likely to increase substantially. In addition, as current management is under no obligation to continue to extend credit to the Company and/or invest in the Company, there is no assurance that such credit or investment will continue or that it will continue to be sufficient for future periods. 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. None; not applicable. Item 5. Other Information. None; not applicable. Item 6. Exhibits and Reports on Form 8-K. Exhibit No. Description EX-27 Financial Data Schedule No other exhibits were filed on Form 8-K. SIGNATURES In accordance with the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Holographic Systems, Inc. Date: November 14, 2000 By /s/ Justeene Blankenship ---------------------- Justeene Blankenship, President