-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HwAexAym1gXrsGjnaEKZExqEaY1QR40oclHfj4+Z5D9Be6tgayKHu3wfHxnGDXT7 sTvfEa7NIkKILuzKkdpNDw== 0001000096-97-000202.txt : 19970415 0001000096-97-000202.hdr.sgml : 19970415 ACCESSION NUMBER: 0001000096-97-000202 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970228 FILED AS OF DATE: 19970414 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CREATIVE PROGRAMMING & TECHNOLOGY VENTURES INC CENTRAL INDEX KEY: 0000913160 STANDARD INDUSTRIAL CLASSIFICATION: GAMES, TOYS & CHILDREN'S VEHICLES (NO DOLLS & BICYCLES) [3944] IRS NUMBER: 841236669 STATE OF INCORPORATION: CO FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-22762 FILM NUMBER: 97580234 BUSINESS ADDRESS: STREET 1: 7900 E UNION AVE STE 1100 CITY: DENVER STATE: CO ZIP: 80237 BUSINESS PHONE: 3036945324 MAIL ADDRESS: STREET 1: 7900 EAST UNION AVE STREET 2: STE 1100 CITY: DENVER STATE: CO ZIP: 80237 10QSB 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended February 28, 1997 ---------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 14 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------------- ---------------- Commission file number 0-19817 Creative Programming and Technology Ventures, Inc. -------------------------------------------------- (Exact name of registrant as specified in its charter) Colorado 84-1236669 - ------------------------------- ---------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) (303) 694-5324 --------------------------------------------------- (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 report(s), and (2) has been suhject to such filing requirements for the past 90 days. YES [ X ] NO [ ] APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS. Indicate by check mark whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by court. YES [ ] NO [ ] APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 3,110,379 common shares as of March 19, 1997. CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES INDEX PART I. PART 1, ITEM 1: FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET AS OF FEBRUARY 28, 1997 (UNAUDITED) 1 CONSOLIDATED STATEMENTS OF OPERATIONS FOR THREE MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 (UNAUDITED) 3 CONSOLIDATED STATEMENTS OF OPERATIONS FOR SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 (UNAUDITED) 4 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY FOR SIX MONTHS ENDED FEBRUARY 28, 1997 (UNAUDITED) 5 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 (UNAUDITED) 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 8 PART 1, ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS PART II. OTHER INFORMATION ITEMS 1 THROUGH 6 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UNAUDITED) FEBRUARY 28, 1997 ASSETS Current assets: Cash and cash equivalents $5,572,197 Investment 14,365 Prepaid expenses 35,355 Note receivable under sale of discontinued operations 71,564 ---------- Total current assets 5,693,481 ---------- Property and equipment, net 8,681 ---------- Other assets: Restricted cash 700,000 Organization costs and other 8,486 ---------- 708,486 ---------- Total assets $6,410,648 ========== See notes to consolidated financial statements. 1 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UNAUDITED) (CONTINUED) FEBRUARY 28, 1997 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable, trade $ 59,935 Accrued income taxes 41,000 ----------- Total current liabilities 100,935 ----------- Shareholders' equity: Preferred stock, par value $0.01; authorized 10,000,000 shares, issued and outstanding 1,000,000 (aggregate liquidation preference $10,000) 10,000 Common stock, par value $0.01; authorized 50,000,000 shares, issued 3,131,379 shares 31,314 Capital in excess of par 8,138,195 Deficit (1,869,796) ----------- Total shareholders' equity 6,309,713 ----------- Total liabilities and shareholders' equity $ 6,410,648 =========== See notes to consolidated financial statements. 2 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) THREE MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 1997 1996 ------------ ----------- Revenues $ $ 30,000 Cost of sales 132,134 ----------- ----------- (102,134) Selling general and administrative expenses 155,942 569,684 ----------- ----------- Operating loss (155,942) (671,818) Other credits (charges): Investment income 78,806 32,682 Interest expense (6,671) ----------- ----------- Loss before income tax benefit (77,136) (645,807) Income tax benefit 2,000 ----------- ----------- Net loss $ (75,136) $ 645,807 =========== =========== Net loss per common share $ (0.02) $ (0.20) =========== =========== Weighted average number of common shares 3,176,102 3,251,831 =========== =========== See notes to consolidated financial statements. 3 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 1997 1996 ----------- ----------- Revenues $ $ 80,560 Cost of sales 321,151 ----------- ----------- (240,591) Selling general and administrative expenses 391,371 1,288,917 ----------- ----------- Operating loss (391,371) (1,529,508) Other credits (charges): Investment income 140,967 83,868 Interest expense (18,647) (12,719) ----------- ----------- Loss before gain on sale of subsidiary and income taxes (269,051) (1,458,359) Gain on sale of subsidiary (Note 2) 4,508,278 ----------- ----------- Income (loss) before income taxes 4,239,227 (1,458,359) Income taxes (41,000) ----------- ----------- Net income (loss) $ 4,198,227 $(1,458,359) =========== =========== Net income (loss) per common share $ 1.31 $ (0.44) =========== =========== Weighted average number of common shares 3,193,185 3,337,805 =========== =========== See notes to consolidated financial statements. 4
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) SIX MONTHS ENDED FEBRUARY 28, 1997 Preferred stock Common stock --------------------- --------------------- Capital Shares Amount Shares Amount excess of par Deficit Total ------ ------ ------ ------ ------------- ----------- ------ Balances, September 1, 1996 1,000,000 $ 10,000 3,210,079 $ 32,101 $ 8,222,937 $(6,068,023) $ 2,197,015 Repurchase and retirement of common stock (Note 3) (78,700) (787) (84,742) (85,529) Net income 4,198,227 4,198,227 --------- -------- --------- -------- ------------ ------------ ------------ Balances, February 28, 1997 1,000,000 $ 10,000 3,131,379 $ 31,314 $ 8,138,195 $(8,138,195) $ 6,309,713 ========= ======== ========= ======== =========== =========== =========== See notes to consolidated financial statements. 5
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 1997 1996 ----------- ----------- Cash flows from operating activities: Net income (loss) $ 4,198,227 $(1,458,359) ----------- ----------- Adjustment to reconcile net income (loss) to net cash used in operating activities: Depreciation and amortization 2,419 166,589 Gain on sale of subsidiary (4,508,278) Loss on investments 27,474 Write-off of project costs 17,232 (Increase) decrease in assets: Accounts receivable 35,464 Work-in-progress 24,440 Prepaid expenses (8,764) (112,566) Other assets 13,828 16,360 Increase (decrease) in liabilities: Accounts payable (74,310) (198,705) Other current liabilities (56,767) (21,351) Accrued income taxes 41,000 ----------- ----------- Total adjustments (4,590,872) (45,063) ----------- ----------- Net cash used in operating activities: (392,645) (1,503,422) ----------- ----------- Cash flows from investing activities: Proceeds from sale of subsidiary, net of $700,000 cash held in escrow 5,907,448 Capital expenditures (180,516) Purchase of treasury bills (15,169) Proceeds from sales of treasury bills 1,149,691 Proceeds from maturity of treasury bills 35,000 600,000 Proceeds from maturity of certificates of deposits 281,000 131,000 Payments received on note receivable 39,643 Project costs (633,384) ----------- ----------- Net cash provided by investing activities 6,247,922 1,066,791 ----------- ----------- (Continued) 6
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED) SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 1997 1996 ----------- ----------- Cash flows from financing activities: Payment of notes payable (511,527) (77,113) Proceeds from issuance of notes payable 35,180 Principal payments of capital lease obligations (5,210) (21,962) Purchase and retirement of common stock (85,529) (134,853) ----------- ----------- Net cash used in financing activities (602,266) (198,748) ----------- ----------- Net increase (decrease) in cash 5,253,011 (635,379) Cash and cash equivalents, beginning 319,186 1,302,292 ----------- ----------- Cash and cash equivalents, ending $ 5,572,197 $ 666,913 =========== =========== Supplemental disclosure of cash flows information: Cash paid for interest $ 25,213 $ 12,719 =========== =========== Supplemental schedule of non-cash investing and financing activities: In December 1995, the Company acquired $32,322 in fixed assets through capital lease obligations. See notes to consolidated financial statements. 7 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 1. The interim financial statements: These interim financial statements have been prepared by Creative Programming and Technology Ventures, Inc. ("CPTV", the "Company") and, in the opinion of management, reflect all material adjustments which are necessary to a fair statement of results for the interim period presented. Certain information and footnote disclosures made in the Company's Form 10-KSB have been condensed or omitted for the interim statements. Certain costs are estimated for the full year and allocated to interim periods based on activity associated with the interim period. Accordingly, such costs are subject to year-end adjustment. It is the Company's opinion that, when the interim statements are read in conjunction with the Company's financial statements for the year ended August 31, 1996 included in Form 10-KSB, the disclosures are adequate to make the information presented a fair presentation of the Company's financial condition. The results of operations for the six months ended February 28, 1997 are not necessarily indicative of the results to be expected for the full year. 2. Sale of the Company's interest in ODDWORLD and certain assets of Alexandria: On September 13, 1996, the Company sold its entire interest in ODDWORLD to an unrelated third party for $7,000,000 less unpaid expenses incurred as of August 16, 1996. In addition, Alexandria conveyed all of its assignable assets to ODDWORLD which have been included in the sale. Shareholder approval of this transaction occurred on November 15, 1996. From August 16, 1996, through the date of shareholder approval, the purchaser made advances to ODDWORLD of $225,210. These advances were made for the purpose of providing working capital and to fund the operations of ODDWORLD subsequent to August 16, 1996. As a result of the approval of this transaction and pursuant to the provisions of the purchase agreement, the purchaser became responsible for all liabilities of ODDWORLD incurred subsequent to August 16, 1996 including the $225,210 of advances, thus, the consolidated financial statements of the Company do not include expenses or liabilities incurred by ODDWORLD subsequent to August 16, 1996. 8 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) SIX MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996 2. Sale of the Company's interest in ODDWORLD and certain assets of Alexandria (continued): The purchase agreement requires that 10% of the purchase price ($700,000) be retained in a hold back escrow account, until September 1998, to provide the purchaser with potential recourse against the Company for any valid future claims arising regarding any of the representations and warranties made to the purchaser by the Company. As stipulated in the agreement, the purchaser may make no claim unless the total of all damages suffered exceeds $100,000, but all potential future claims will be capped at $2,000,000. The Company received $6,128,088 of cash (the purchase price of $7,000,000 net of unpaid expenses of $171,912 and net of the $700,000 held in escrow of ODDWORLD as of August 16, 1996) in exchange for the Company's interest in ODDWORLD and the assets of Alexandria conveyed to ODDWORLD. In addition, $220,640 of transaction expenses were incurred and these have been netted against the $6,128,088 to give net cash received on the sale of $5,907,448. At September 13, 1996, the Company's interest consisted of accounts receivable of $2,734, property and equipment of $701,075 project costs of $1,827,680, other assets of $61,616, notes payable to financial institutions of $225,822, capital lease obligations of $19,958, accounts payable of $186,790, and accrued salaries and other expenses of $61,365. The sale results in a gain of $4,508,278. The Company used $500,000 of the sale proceeds to repay notes payable, shareholders. 3. Repurchase and retirement of common stock: During the quarter ended February 28, 1997, the Company repurchased 78,700 shares of its common stock in the open market for $85,529. These shares were subsequently canceled. 9 PART 1, ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS Overview On September 13, 1996, Creative Programming and Technology Ventures, Inc. ("CPTV" or the "Company") sold its entire interest in its Off World Entertainment, Inc. (d.b.a. OddWorld Inhabitants) subsidiary to GT Interactive Software Corporation (the "GT Transaction"). This transaction culminated on November 15, 1996 with the proceeds of this sale (outside of $700,000 in restricted cash in escrow) being available to CPTV on November 18, 1996. The Company has to date invested the proceeds in short-term government backed instruments. Financial Condition, Liquidity and Capital Resources After payment of corporate overhead and expenses associated with the GT Transaction, and costs related to potential future business opportunities, CPTV has current working capital in excess of $5,500,000 and shareholders equity in excess of $6,300,000. Subsequent to the closing of the GT Transaction, CPTV has focused its efforts towards investigating new business opportunities. The Company is now in the mature stages of due diligence on a couple of prospective transactions. Such a transaction, if brought to fruition, would result in the shareholders of CPTV having an interest in a new line of business outside of interactive video game publishing sector. As previously disclosed, the Board also believes it prudent to seek out the guidance and direction of its public shareholders on several important business issues. If after a reasonable period of time the Board of Directors has not been able to bring to closure any of its prospective new business targets, the Board will consider the alternatives of paying cash dividends to shareholders or pursue a full liquidation of the Company. CPTV's actions are in part being 10 driven by stock market regulatory bodies who have decided to challenge (or hold a hearing on) CPTV's continued NASDAQ listing, based on unilateral interpretation of certain listing standards. CPTV will hold an Annual Shareholders Meeting on April 17, 1997 and as described in the proxy statement for that meeting, the Company is considering the possible liquidation and dissolution of the Company and seeking shareholder response on that issue. The proxy also outlines in detail a number of other important matters of corporate governance to be considered by the shareholders. Results of Operations CPTV reported operating results for the second quarter ended February 28, 1997 recognizing a net loss of $75,136 or $.02 per share as compared to a net loss of $645,807 or $.20 per share for second quarter February 1996. The loss reflects basic ongoing operating and reporting costs as compared to the 1996 operating loss at which period the Company had significantly more operating expense. For the six months ended February 28, 1997, due to the non-recurring receipts associated with the GT divestiture, the Company reported net income of $4,198,227 or $1.31 per share as compared to a loss of $1,458,359 or $0.44 for the same period ended in 1996. Interest income amounted to approximately $73,000 on all cash balances. This income was offset by ongoing operating, reporting, and other expenses associated with due diligence of business prospects CPTV is actively evaluating. 11 SIGNATURE PAGE 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. Creative Programming and Technology Ventures, Inc. By: /S/ GARY R. VICKERS ---------------------------------------------- Gary R. Vickers, President Date: April 14, 1997 -------------------------------------------- 12 EX-27 2 FINANCIAL DATA SCHEDULE
5 This Schedule contains summary financial information extracted from the consolidated balance sheet and statement of operations for the six months ended February 28, 1997 for Creative Programming and Technology Ventures, Inc. and Subsidiaries. 6-MOS AUG-31-1996 FEB-28-1997 5,572,197 14,365 71,564 0 0 5,693,481 19,761 11,080 6,410,648 100,935 0 0 10,000 31,314 6,268,399 6,309,713 0 0 0 0 391,371 0 18,647 4,239,227 41,000 4,198,227 0 0 0 4,198,227 1.31 1.31
-----END PRIVACY-ENHANCED MESSAGE-----