-----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, UZcKPNgqSYL0CzCQP1eE7zqShRwq4AZHS/zDo9duTUC8zWvaEavnUZhGRAJWdNIa wLCzBaJ8Y0G2yxWD03u8nw== 0001000096-97-000486.txt : 19970716 0001000096-97-000486.hdr.sgml : 19970716 ACCESSION NUMBER: 0001000096-97-000486 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970531 FILED AS OF DATE: 19970715 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: 97640971 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 May 31, 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 subject 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: 3,102,379 common shares as of July 7, 1997. CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES INDEX PART I, ITEM 1: FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET AS OF MAY 31, 1997 (UNAUDITED) 1 CONSOLIDATED STATEMENTS OF OPERATIONS FOR THREE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 (UNAUDITED) 3 CONSOLIDATED STATEMENTS OF OPERATIONS FOR NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 (UNAUDITED) 4 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY FOR NINE MONTHS ENDED MAY 31, 1997 (UNAUDITED) 5 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 (UNAUDITED) 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 8 PART I, ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS 10 PART II. OTHER INFORMATION ITEMS 1 THROUGH 6 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UNAUDITED) MAY 31, 1997 ASSETS Current assets: Cash and cash equivalents $2,642,028 Investments 2,574,082 Prepaid expenses 27,361 Note receivable under sale of discontinued operations 50,837 ---------- Total current assets 5,294,308 ---------- Property and equipment, net 7,643 ---------- Other assets: Restricted cash 700,000 Restricted interest receivable 22,197 Organization costs and other 8,141 ---------- 730,338 ---------- Total assets $6,032,289 ========== See notes to consolidated financial statements 1 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UNAUDITED) (CONTINUED) MAY 31, 1997 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable, trade $ 76,103 Accrued income taxes 34,000 ----------- Total current liabilities 110,103 ----------- Shareholders' equity: Preferred stock, par value $0.01; authorized 10,000,000 shares, issued and outstanding 1,000,000 shares (aggregate liquidation preference $10,000) 10,000 Common stock, par value $0.01; authorized 50,000,000 shares, issued and outstanding 3,110,379 shares 31,104 Capital in excess of par 8,113,194 Deficit (2,232,112) ----------- Total shareholders' equity 5,922,186 ----------- Total liabilities and shareholders' equity $ 6,032,289 =========== See notes to consolidated financial statements. 2 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) THREE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 1997 1996 ----------- ----------- Cost of sales $ $ 572,477 ----------- ----------- (572,477) Selling, general and administrative expenses 458,097 650,558 Impairment loss 73,732 ----------- ----------- Operating loss (458,097) (1,296,767) Other credits (charges): Investment income 88,779 17,621 Interest expense (5,314) ----------- ----------- Loss before income tax benefit (369,318) (1,284,460) Income tax benefit 7,000 ----------- ----------- Net loss $ (362,318) $(1,284,460) =========== =========== Net loss per common share $ (0.12) $ (0.40) =========== =========== Weighted average number of common shares 3,114,031 3,210,079 =========== =========== See notes to consolidated financial statements. 3 CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 1997 1996 ----------- ----------- Revenues $ $ 80,560 Cost of sales 893,628 ----------- ----------- (813,068) Selling, general and administrative expenses 849,468 1,939,475 Impairment loss 73,732 ----------- ----------- Operating loss (849,468) (2,826,275) Other credits (charges): Investment income 229,746 101,489 Interest expense (18,647) (18,033) ----------- ----------- Loss before gain on sale of subsidiary and income taxes (638,369) (2,742,819) Gain on sale of subsidiary (Note 2) 4,508,280 ----------- ----------- Income (loss) before income taxes 3,869,911 (2,742,819) Income taxes (34,000) ----------- ----------- Net income (loss) $ 3,835,911 $(2,742,819) =========== =========== Net income (loss) per common share $ 1.21 $ (0.83) =========== =========== Weighted average number of common shares 3,162,644 3,307,896 =========== =========== See notes to consolidated financial statements. 4
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED) NINE MONTHS ENDED MAY 31, 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) (99,700) (997) (109,743) (110,740) Net income 3,835,911 3,835,911 ---------- -------- --------- -------- ----------- ----------- ----------- Balances, May 31, 1997 1,000,000 $ 10,000 3,110,379 $ 31,104 $ 8,113,194 $(2,232,112) $ 5,922,186 ========== ======== ========= ======== =========== =========== =========== See notes to consolidated financial statements. 5
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 1997 1996 ----------- ----------- Cash flows from operating activities: Net income (loss) $ 3,835,911 $(2,742,819) ----------- ----------- Adjustments to reconcile net income (loss) to net cash used in operating activities: Depreciation and amortization 3,804 260,586 Gain on sale of subsidiary (4,508,278) Loss on investments 36,065 Write-off of project costs 632,170 Impairment loss 73,732 (Increase) decrease in assets: Accounts receivable 29,944 Interest receivable (22,197) Work-in-progress 24,440 Prepaid expenses (770) (40,010) Other assets 13,828 4,232 Increase (decrease) in liabilities: Accounts payable (58,142) (152,183) Other current liabilities (56,767) (30,117) Accrued income taxes 34,000 ----------- ----------- Total adjustments (4,594,522) (838,859) ----------- ----------- Net cash used in operating activities: (758,611) (1,903,960) ----------- ----------- Cash flows from investing activities: Proceeds from sale of subsidiary, net of $700,000 cash held in escrow 5,907,447 Capital expenditures (230,439) Purchase of treasury bills ( (2,574,886) Proceeds from sales of treasury bills 1,449,560 Proceeds from maturity of treasury bills 35,000 900,000 Proceeds from maturity of certificates of deposits 281,000 131,000 Payments received on note receivable 60,370 53,575 Project costs (925,951) ----------- ----------- Net cash provided by investing activities 3,708,931 1,377,745 ----------- ----------- (Continued) 6
CREATIVE PROGRAMMING AND TECHNOLOGY VENTURES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED) NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 1996 1997 1996 ------------ ----------- Cash flows from financing activities: Payment of notes payable (511,527) (110,416) Principal payments of capital lease obligations (5,210) (28,692) Purchase and retirement of common stock (110,741) (134,853) ----------- ----------- Net cash used in financing activities (627,478) (273,961) ----------- ----------- Net increase (decrease) in cash 2,322,842 (800,176) Cash and cash equivalents, beginning 319,186 1,302,292 ----------- ----------- Cash and cash equivalents, ending $ 2,642,028 $ 502,116 =========== =========== Supplemental disclosure of cash flows information: Cash paid for interest $ 25,213 $ 18,033 =========== =========== 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) NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 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 nine months ended May 31, 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) NINE MONTHS ENDED MAY 31, 1997 AND MAY 31, 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, $220,641 of transaction expenses were incurred and these have been netted against the $6,128,088 to give net cash received on the sale of $5,907,447. 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 nine months ended May 31, 1997, the Company repurchased 99,700 shares of its common stock in the open market for $110,740. These shares were subsequently canceled. 9 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. 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. CPTV currently believes that such a transaction, if brought to fruition, would result in the shareholders of CPTV having an interest in a new line of business. To date, CPTV has been evaluating the purchase of the Arapahoe Basin Ski area and other resort and recreational development opportunities throughout Colorado and the Greater Rocky Mountain region. Arapahoe Basin is being divested from Vail Resorts, Inc., by order of a Department of Justice Consent Decree as a condition to Vail's approval on the purchase of Keystone and Breckenridge Ski areas from Ralcorp Inc., (of St. Louis). As CPTV's prospective investments become more mature, management will provide additional disclosure as to the specific nature of the proposed target investments. CPTV has continued to adjourn its annual shareholder meeting pending the maturity of the aforesaid efforts. As previously disclosed, CPTV opposed a recent action brought by the NASD staff to delist CPTV from the NASDAQ Small Capital quotation system. CPTV temporarily addressed the concerns of the NASD Hearing Panel with respect to its continued listing on the NASDAQ and has been given an extension until mid August to solidify its efforts on the proposed acquisition of a target company or the NASDAQ panel will hold another hearing to delist its securities based on its broad discretionary authority. CPTV is working diligently and prudently to fulfill this obligation, but as disclosed to the NASD panel, there are no assurances it will be successful in concluding its acquisition of Arapahoe Basin Ski area or its other opportunities by that date. Financial Condition, Capital Resources and Results of Operations After payment of corporate overhead, ongoing and accrued expenses associated with the GT Transaction, and costs related to due diligence on potential future business opportunities, CPTV reported current working capital of approximately $5,200,000 and shareholders equity of approximately $6,000,000. 10 The diminishment of capital resources also reflects the continued efforts on behalf of CPTV to repurchase its own common stock which it believes is a good investment due to the fact that its shares reflect a price well below book value. CPTV reported operating results for the third quarter ended May 31, 1997 recognizing a net loss of $362,318 or $.12 per share as compared to a net loss of $1,284,460 or $.40 per share for the third quarter May 1996. For the nine months ended May 31, 1997, due to the non-recurring receipts associated with the GT divestiture, the Company reported net income of $3,835,911 or $1.21 per share as compared to a loss of $2,742,819 or $0.83 for the same period ended in 1996. The third quarter loss reflects ongoing operating expenses, administrative, legal and reporting costs as compared to the 1996 operating loss at which period the Company had significantly greater operating expense associated with the cost of developing opportunities in its OddWorld and Alexandria subsidiaries. In addition, there was a one-time payment made to Directors and Officers for their inordinate involvement in bringing the GT Transaction to a successful culmination and the resultant current year profit. These payments, based closely upon the recommendation of an independent expert in compensation to the multimedia industry, represent fees to Directors on a per meeting basis, as previously reported, payment for certain services rendered, and management compensation. The management of CPTV believes that in the future, interest income will partially offset any additional corporate overhead during the ensuing period in which it pursues potential business opportunities. CPTV currently is estimating that it will earn approximately $3,600,000 to $3,700,000 or approximately $1.14 to $1.17, respectively, per share for its fiscal year ending August 31, 1997 barring any expenditures associated with a new acquisition or any other extraordinary events. 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 ------------------------------------------- Date: July 15, 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 nine months ended May 31, 1997 for Creative Programming and Technology Ventures, Inc., and subsidiaries. 9-MOS AUG-31-1996 MAY-31-1997 2,642,028 2,574,082 50,837 0 0 5,294,308 19,761 12,118 6,032,289 110,103 0 0 10,000 31,104 5,881,082 6,032,289 0 0 0 0 849,468 0 18,647 3,869,911 34,000 3,835,911 0 0 0 3,835,911 1.21 1.21
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