U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 August 31, 2002
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________________to________________
TAMARAK, INC.
(Exact name of small business issuer as specified in its charter)
Nevada
(State or other jurisdiction of Incorporation or organization)
95-4790148
(IRS Employer Identification No.)
7311 Van Nuys Boulevard, Suite 2, Van Nuys, CA 91405
(Address of Principal executive offices)
(818) 780-2890
(Issuer's telephone number, including area code)
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.)
YES X 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:
21,612,000 shares as of August 31, 2002.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This discussion in this quarterly report regarding Tamarak, Inc. and our business and operations contains "forward-looking statements." These forward-looking statements use words such as "believes," "intends," "expects," "may," "will," "should," "plan," "projected," "contemplates," "anticipates," or similar statements. These statements are based on our beliefs, as well as assumptions we have used based upon information currently available to us. Because these statements reflect our current views concerning future events, these statements involve risks, uncertainties and assumptions. Actual future results may differ significantly from the results discussed in the forward-looking statements. A reader, whether investing in our common stock or not, should not place undue reliance on these forward-looking statements, which apply only as of the date of this report.
When used in this Quarterly Report on Form 10-QSB, "Tamarak," "we," "our," and "us" refers to Tamarak, Inc., a Nevada corporation.
INDEX
Part I. Financial Information
Item 1. Financial Information
Balance Sheets at August 31, 2002
Statements of Operations for the three months ended August 31, 2002 and 2001 and from the period from March 16, 2000 (Date of Inception) to August 31, 2002
Statements of Change in Stockholders' Deficit for the period from March 16, 2000 (Date of Inception) to August 31, 2002
Statements of Cash Flows for the three months ended August 31, 2002 and 2001and for the period from March 16, 2000 (Date of Inception) to August 31, 2002
Notes to Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Part II. Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Part I. Financial Information
Item 1. Financial Information
INDEPENDENT ACCOUNTANT'S REVIEW REPORT
To the Board of Directors and Stockholders of
Tamarak, Inc. (A Company in the Development Stage)
We have reviewed the accompanying balance sheet of Tamarak, Inc. (referred to herein as the “Company") (a Company in the development stage) as of August 31, 2002, and the related statement of operations and cash flows for the three-month periods ended August 31, 2002 and 2001, the statement of stockholders' deficit for the period ending August 31, 2002 as well as the cumulative statements from inception (March 16, 2000) to August 31, 2002. These financial statements are the responsibility of the Company's management.
We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that should be made to the accompanying financial statements referred to above for them to be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted standards, the balance sheet and related statements of operations, stockholders' deficit and cash flows at February 28, 2002 and the results of operations and cash for the year ended February 28, 2002 as well as the statements of operations and cash flows from inception (March 16, 2000) to February 28, 2001 and the cumulative statements from inception to February 28, 2002, not presented herein, and our report dated June 6, 2002, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying balance sheet as of February 28, 2002, is fairly stated, in all material respects, in relation to the balance sheet from which it is derived.
Gaytan, Kallman & Company, LLP, CPA's
Los Angeles, California
October 18, 2002
TAMARAK, INC. | ||||
(A Development Stage Company) | ||||
Balance Sheet | ||||
August 31, 2002 | ||||
CURRENT ASSETS |
| |||
| Cash |
| $ | 19,315 |
PROPERTY, PLANT AND EQUIPMENT (Note 2) |
|
| ||
Office furniture and equipment |
| 448 | ||
| Accumulated depreciation | (131) | |||
| Total Property, plant and equipment | 317 | |||
| Total Assets |
| $ | 19,632 |
|
|
|
|
|
| ||||
LIABILITIES AND STOCKHOLDERS DEFICIT |
|
| ||
CURRENT LIABILITIES |
|
| ||
| Loan payable - Officers (Note 3) |
| 19,723 | |
|
| Total Current Liabilities |
| 19,723 |
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| ||||
STOCKHOLDERS DEFICIT (Note 6) |
|
| ||
| Common stock, $.001 par value; 50,000,000 shares |
|
| |
| authorized; 21,612,000 shares issued and outstanding |
| 21,612 | |
| Paid-in capital |
| 64,494 | |
| Deficit accumulated during the development stage |
| (86,197) | |
|
|
|
|
|
(91) | ||||
|
| Total Liabilities and Stockholders' Deficit | $ | 19,632 |
The accompanying notes are an integral part of these audited financial statements. | ||||
F-1 | ||||
TAMARAK, INC. | |||||||
(A Development Stage Company) | |||||||
Statements of Operations | |||||||
Quarters ended August 31, 2001 and 2002, and the Period From | |||||||
March 16, 2000 (Date of Inception) to August 31, 2002 | |||||||
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| Period From |
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|
| March 16, 2000 |
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| Three Months Ended |
| to | ||
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| August 31, |
| August 31, | ||
|
|
| 2002 |
| 2001 |
| 2002 |
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|
|
|
|
|
|
|
| Costs and Expenses: | |||||||
Administration | $ | 2,983 | $ | - | $ | 19,494 | |
| Auto Expense | - | - | 3,840 | ||||
| Bank Charges | - | - | 250 | ||||
| Cable & Web Services | 245 | 144 | 1,322 | ||||
| Depreciation | 21 | - | 131 | ||||
| Document Fees | - | - | 1,409 | ||||
| Dues & Subscriptions | - | - | 5,257 | ||||
| Entertainment | - | - | 1,666 | ||||
Insurance |
| - |
| 416 |
| 1,295 | |
Legal Fees |
| 5,000 |
| - |
| 26,012 | |
Office Expense |
| - |
| - |
| 3,316 | |
| Postage | - | - | 433 | ||||
| Printing | - | - | 1,260 | ||||
| Rent | 1,424 | 100 | 12,552 | ||||
| Repairs | - | - | 152 | ||||
| State Filing Fees | - | - | 430 | ||||
| Telephone | 369 | 240 | 2,991 | ||||
Transfer Agent |
| 712 |
| - |
| 4,383 | |
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| Net loss | $ | (10,754) | $ | (900) | $ | (86,197) |
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| Earnings per share: | |||||||
| Basic: | |||||||
| Income (loss) from continuing operations | $ | (10,754) | $ | (900) | $ | (86,197) |
| Income adjustments |
| - |
| - |
| - |
| Net income (loss) from continuing operations | |||||||
| attributable to common shares | (10,754) | (900) | (86,197) | ||||
| Weighted average common shares outstanding | 21,612,000 | 20,000,000 | 20,329,931 | ||||
| Basic earnings per share from continuing operations | ($0.01) | ($0.01) | ($0.01) | ||||
| Diluted: | |||||||
| Income (loss) from continuing operations | (10,754) | (900) | (86,197) | ||||
| Income adjustments | - | - | - | ||||
| Adjusted income from continuing operations | (10,754) | (900) | (86,197) | ||||
| Weighted average common shares outstanding | 21,612,000 | 20,000,000 | 20,329,931 | ||||
| Dilutive securities | - | - | - | ||||
| Adjusted weighted average | |||||||
| common shares outstanding | 21,612,000 | 20,000,000 | 20,329,931 | ||||
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| Diluted earnings per share from |
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| continuing operations | ($0.01) | ($0.01) | ($0.01) | ||||
The accompanying notes are an integral part of these audited financial statements.
TAMARAK, INC. |
(A Development Stage Company) |
Statements of Cash Flows |
Quarters Ended August 31, 2001 and 2002 and the |
Period from March 16, 2000 (Date of Inception) to August 31, 2002
|
| Three Months Ended August 31, 2002 | Three Months Ended August 31, 2001 | Period from March 16, 2000 to August 31, 2002 | |
| Cash flows from operating activities: | |||
| Net Loss | $(10,754) | $(900) | $(86,197) |
Adjustments to reconcile net loss to net cash used by operating activities: | |||
| Depreciation | 21 | - | 131 |
Increase in other assets | - | - | (6,608) |
Decrease in other assets | - | - | 6,608 |
| Net cash used in Operating Activities | $(10,733) | $(900) | $(86,066) |
| Cash flows from investing activities: | |||
| Purchase of equipment | - | - | (448) |
| Net Cash Used in Investing Activities | - | - | (448) |
| Cash flows from financing activities: | |||
| Proceeds from officer loan | 0 | 900 | 19,723 |
| Contribution of capital | 0 | - | 86,106 |
Net Cash Provided by Financing Activities | 0 | $900 | $105,829 |
| Net increase in Cash | $(10,733) | - | $19,315 |
| Cash, beginning of period | $30,048 | - | - |
| Cash, end of period | $19,315 | - | $19,315 |
The accompanying notes are an integral part of these audited financial statements
| TAMARAK, INC. |
| (A Development Stage Company) |
| Statements of Changes in Stockholders' Deficit |
| Period from March 16, 2000 (Date of Inception) to August 31, 2002 |
| Deficit | |||||
Common Stock |
| Accumulated |
| |||
Shares | Value Per Share(1) | Common Stock | Additional Paid-In Capital | During the Development Stage | Total | |
Issuance of share capital to founders of Tamarak, Inc. for cash on March 16, 2000 | 20,000,000 | $0.001 | $20,000 | $2,986 | $ --- | $ 22,986 |
Net loss for the period ending February 28, 2001 | - | - | - | - | (15,930) | (15,930) |
Balances at February 28, 2001 | 20,000,000 | 0.001 | 20,000 | 2,986 | (15,930) | 7,056 |
Net loss for the period ending February 28, 2002 | - | - | - | - | (26,748) | (26,748) |
Balances at February 28, 2002 | 20,000,000 | 0.001 | 20,000 | 2,986 | (42,678) | (19,692) |
Issuance of share capital for cash on March 1, 2002 | 1,612,000 | 0.04 | 1,612 | 61,508 | - | 63,120 |
Net loss for the period ending May 31, 2002 | - | - | - | - | (32,765) | (32,765) |
Balances at May 31, 2002 | 21,612,000 | 0.004 | 21,612 | 64,494 | (75,443) | 10,663 |
| Net loss for the period ending August 31, 2002 | - | - | - | - | (10,754) | (10,754) |
| Balances at August 31, 2002 | 21,612,000 | 0.004 | 21,612 | 64,494 | (86,197) | (91) |
(1): This value is rounded to the nearest thousandth.
The Accompanying notes are an integral part of these audited financial statements.
TAMARAK, INC.
(A Development Stage Company)
Notes to Financial Statements
For the period from March 16, 2000 to August 31, 2002
1. DEVELOPMENT STAGE COMPANY
Tamarak Inc., a development stage company that incorporated on March 16, 2000, is engaged in the development of theatrical and television films. The Company has no significant revenues from its principle operations. The Company is currently engaged in acquiring the necessary financing for the production of major motion pictures and a network television mini-series.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingencies at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
The Company maintains its cash balances in two financial institutions located in Los Angeles, California. The balances are insured by the Federal Deposit Insurance Corporation up to $100,000. The Company has no cash balances at risk as of August 31, 2002.
Property and Equipment
Property and Equipment Property and equipment are stated at cost. Depreciation is calculated using the straight-line method for financial statement purposes over the estimated useful lives of assets. The estimated useful lives of the property and equipment is five years.
3. RELATED PARTY TRANSACTIONS
As of August 31, 2002, A.J. Leydton, President and CEO of Tamarak, Inc., had made a loan to the Company. The loan is unsecured, non-interest bearing and without a stated maturity date.
4. SCRIPTS
The principal assets of the Company are four, major motion picture screenplays originally written by A.J. Leydton and Frank Stewart. They sold the scripts to Aquila Communications, Inc. in 1992. Three of the scripts have been registered with copyrights. The sales had stipulations that provided for the rights to revert back to Mr. Leydton and Mr. Stewart if Aquila Communications failed to produce the scripts within five years. In 1997, these script rights reverted back to Mr. Leydton and Mr. Stewart. In March of 2000, the scripts were contributed to Tamarak, Inc. for the purpose of producing them into full feature length movies. While the scripts have no assigned value for GAAP (Topic 5G of the Staff Accounting Bulletins (SAB 48)) purposes, the company intends to produce them upon receipt of appropriate financing.
5. JACQUELINE COCHRANE STORY
The principal members of management have been developing a mini-series entitled the "Jacqueline Cochrane Story" for several years. While the mini-series has no assigned value for GAAP (Topic 5G of the Staff Accounting Bulletins (SAB 48)) purposes, the management believes the project remains viable and production will commence once financing has been secured.
6. EQUITY
The Company's authorized capital stock consists of 50,000,000 shares of Common Stock with a $.001 par value. As of August 31, 2002, the Company has outstanding 21,612,000 shares of its Common Stock. Holders of the Company's Common Stock are entitled to receive dividends when declared by the Board of Directors out of funds legally available for distribution. Any such dividends may be paid in cash, property or shares of the Company common stock. No such dividends have been paid during the company' s operating history. Of the 21,612,000 shares of common stock currently outstanding, 20,000,000 are considered "restricted securities" as that term is defined under Rule 144 promulgated under the Securities Act of 1933, as amended, in that such shares were issued and sold by the Company without registration, as private transactions not involving a public offering.
7. INCOME TAXES
The Company has incurred no income tax expenses since inception. Presently, the Company has a $42,678 Tax Net Operating Loss Carry-Forward available from its first two years of operation. $15,930 of the Net Operating Loss was generated during the operating period from March 16, 2000 to February 28, 2001 while $26,748 of the Carry-Forward was generated during the operating period from March 1, 2001 to February 28, 2002. The Carry-Forwards are available to offset future income for a period of time not to exceed twenty years.
8. LEASES
The Company currently rents office space in Van Nuys, California. The monthly rental payments are currently $500 per month. The term of the lease is currently month-to-month, as Tamarak, Inc., has an oral agreement to make monthly rental payments for an indefinite period of time.
9. EARNINGS PER SHARE
The following table sets forth the computation of earnings per share and earnings per - assuming dilution:
| Three Months Ended August 31, 2002 | Three Months Ended August 31, 2001 | Period from March 16, 2000 to August 31, 2002 | |
| Numerator: | |||
| Net income, earnings per share and earnings per share assuming dilution | $(10,754) | $(900) | $(86,197) |
| Denominator: | |||
Denominator for earnings per share - weighted average shares outstanding | 21,612,000 | 20,000,000 | 20,329,931 |
Effect of dilutive securities | - | - | - |
| Denominator for earnings per share - assuming dilution - adjusted weighted average shares outstanding | 21,612,000 | 20,000,000 | 20,329,931 |
| Earnings per share | $(0.01) | $(0.01) | $(0.01) |
| Earnings per share - assuming dilution | $(0.01) | $(0.01) | $(0.01) |
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
For the three months ended August 31, 2002 and 2001, we had no revenues.
For its first project, the Company plans to produce a mini-series based upon the life and exploits of Jacqueline Cochran, a world-renowned aviatrix. Management believes that the program will be aired on a major commercial television network, bringing immediate recognition, visibility and credibility to the Company. Concurrently, the Company has acquired four screenplays of different genres that will appeal to a wide audience: 1. "System of Justice" (Suspense, murder mystery); 2. "Duster" (Heartwarming personal drama combined with exciting action); 3. "Deadly Innocence" (Contemporary intrigue about murder, greed, toxic waste and insurance fraud); 4. "King of Diamonds" (Fast paced international jewel caper). We are actively seeking additional financing to produce any one or all of these projects.
If additional cash is not raised, either through bank financing, sale of capital stock, or perhaps a joint venture with funding resources, the Company can not achieve its goal of producing the Jacqueline Cochran mini-series. The principals have no legal obligation to advance further funds to the Company to satisfy its capital needs.
The production of the aforementioned mini-series involves the renting of the necessary equipment to facilitate the production process. We estimate the production will cost approximately $3,000,000 for each hour of finished product plus $1,250,000 per hour for the purchase of air time. The total production budget for the Cochran series is $12,000,000, plus an additional $5,000,000 if air time is purchased rather than joint ventured. If no funding commitments are received, sufficient to cover all of these anticipated costs, production will not commence.
Assuming a funding commitment, the Company plans to increase its manpower by hiring more employees to help facilitate the production of the mini-series. This hiring depends on the amount and timing of the funding necessary to get this project started. The Company will make those decisions based on its financial capabilities.
The company does not currently have any external sources of funding, although senior management, identified in this document under "Item 5", is committed to working without pay for at least one year. Mr. Leydton, a creditor and President, has agreed that his loans to the company will not be called unless the company receives production funding. If production funding is never received, Mr. Leydton has agreed to accept additional equity, at the Company's then-book-value price per share, to extinguish his claims.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities and Use of Proceeds
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) 99.1 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(b) Reports on Form 8-K. None.SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned as duly authorized.
Tamarak, Inc.
(Registrant)
/s/ A.J. Leydton
A.J. Leydton
CEO & Chairman
Dated: October 21, 2002
Exhibit 99.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Providential Holdings, Inc. (the "Company") on Form 10-QSB for the year ending June 30, 2002, as filed with the Securities and Exchange Commission on the date hereof (the "Report'), I, A.J. Leydton, CEO and Chairman of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:
(1) The report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
/s/ A.J. Leydton
Chief Executive Officer
Dated: October 21, 2002