SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 April 30, 2001
[ ] 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 2-98997-NY
NOVA INTERNATIONAL FILMS, INC.
(Exact name of Small Business Issuer as Specified in its
Charter)
Delaware 11-2717273
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification
organization) Number)
6350 N.E. Campus Drive
Vancouver, Washington 98661
(Address of Principal Executive Offices)
(360) 737-7700
(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
State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:
Common, $.00001 par value per share: 96,583,000
outstanding as of May 15, 2001
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
NOVA INTERNATIONAL FILMS, INC.
Index to Financial Information
Period Ended April 30, 2001
Item Page
Item 1 - Financial Statements
Balance Sheets 3
Statements of Operations 4-5
Statements of Cash Flows 6
Notes to Financial Statements 7-8
Item 2 - Management's Discussion and
Analysis or Plan of Operation 9
NOVA INTERNATIONAL FILMS, INC.
BALANCE SHEETS
(Unaudited)
APRIL 30, OCTOBER 31,
2001 2000
ASSETS
Cash $2,242 $1,247
Total assets $2,242 $1,247
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Accounts payable
and accrued expenses $1,800 $1,800
Short term loan 13,624 10,624
Total liabilities $15,424 $12,424
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY:
Common Stock, $.00001 par value;
100,000,000 shares authorized,
96,583,000 shares issued
and outstanding, respectively. $ 966 $ 966
Additional paid-in capital 8,197,260 8,197,260
Accumulated deficit -8,211,408 -8,209,403
Total stockholders' equity $-13,182 $-11,177
Total liabilities and
stockholders' equity $2,242 $1,247
The accompanying notes are an integral part of these statements.
NOVA INTERNATIONAL FILMS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
For the For the
Quarter Ended Quarter Ended
April 30, 2001 April 30, 2000
REVENUES:
Interest $ 2 $ 3
COSTS AND EXPENSES:
General and administrative 1,204 1,207
OPERATING LOSS $ -1,202 $ -1,204
PROVISION FOR INCOME TAXES $ - -
NET INCOME (LOSS) $ -1,202 $ -1,204
Net (Income loss) per share $ -.00001 $ -.00001
Average no. of shares
outstanding 96,583,000 96,583,000
The accompanying notes are an integral part of these statements.
NOVA INTERNATIONAL FILMS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
For the Six For the Six
Mos. Ended Mos. Ended
April 30, 2001 April 30, 2000
REVENUES:
Interest $ 5 $ 5
COSTS AND EXPENSES:
General and administrative $ 2,010 4,029
LOSS BEFORE PROVISION
FOR INCOME TAXES $ -2,005 $ -4,024
PROVISION FOR INCOME TAXES - -
NET INCOME (LOSS) $ -2,005 $ -4,024
Net (Income loss) per share $ -.00002 $ -.00005
Average no. of shares outstanding 96,583,000 87,099,575
The accompanying notes are an integral part of these statements.
NOVA INTERNATIONAL FILMS, INC.
STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH
(Unaudited)
For the Six For the Six
Months Ended Months Ended
April 30, 2001 April 30, 2000
Cash flows from operating activities:
Net loss $-2,005 $-4,024
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Net changes in assets and liabilities:
Accounts payable $ - $ -
Total adjustments $ - $ -
Net cash provided (used) by
operating activities $-2,005 $-4,024
Cash flows from investing activities:
Short term loan $ 3,000 $ 4,200
Sale of Common Stock 30
Net cash provided by
investing activities $ 3,000 $ 4,230
Net increase (decrease) in cash $ 995 $ 206
Cash at beginning of period 1,247 1,063
Cash at end of period $2,242 $1,269
The accompanying notes are an integral part of these statements.
NOVA INTERNATIONAL FILMS, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2001
1) Nature of Business and Organization
Nova International Films, Inc. (the Company) was incorporated
on November 27, 1984 in the State of Delaware. The Company was
formed for the purpose of financing and producing motion pictures
for distribution in the theatrical, home video and pay and
free television markets throughout the world.
a. Issuance of Common Stock
On January 2, 1986, the Company completed a public offering,
whereby ten million (10,000,000) units were sold at $.10 per
unit, each unit consisting of one (1) share of Common Stock,
$.00001 par value, and one (1) Redeemable Common Stock
Purchase Warrant. These warrants have now lapsed.
b. Disposition of Assets
On May 12, 1993 (the "Closing"), the stockholders of the Company
approved an Acquisition Agreement dated March 3, 1993 (the
"Acquisition Agreement") by and between the Company
and Epic Productions, Inc. ("Epic"), pursuant to
which the Company sold, assigned, transferred and
conveyed to Epic and Epic acquired from the Company (i) all of the
issued and outstanding shares of capital stock of each of
Byzantine Fire, Inc. a California corporation, Wings of
the Apache, Inc., a California corporation, and
A/R Productions, Ltd., a California corporation (collectively,
the "Subsidiary Corporations"); (ii) all rights to the
completed films "Triumph of the Spirit", "Firebirds" and
"Why Me?", (sometimes collectively herein the "Completed Films");
and (iii) the Company's rights related to the film project
"Carlito's Way" and Jean Claude Van Damme. In exchange therefor,
Epic assumed all debts and liabilities of the Company
with respect to the assets acquired, paid
the Company the sum of $50,000, acquired the Bank Loan from
the Bank as described in Note #4 "Debt" and modified
the loan arrangements thereafter plus other indebtedness
due Epic from the Company.
2) Summary of Significant Accounting Policies
a. Financial Statement Presentation
In accordance with the provisions of Statement of
Financial Accounting Standards No. 53, the
Company has elected to present an unclassified
balance sheet.
b. Per Share Amounts
Per share amounts are based on the weighted average number
of shares outstanding during the period.
NOVA INTERNATIONAL FILMS, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2001
3) Short term loan
An officer of the Company made a short term loans to the
Company in order to allow the Company to meet certain
working capital needs. Such loan is
without interest and payable on demand.
4) Debt
In connection with the financing of the film "Triumph
of the Spirit", the Company was unable to pay Credit Lyonnais
Bank Nederland N.V. (the "Bank") the note payable (the
"Bank Loan") incurred to finance such film at its original
maturity date of March 31, 1991. The Company was able
to negotiate an extension of the maturity date of this
note until September 30, 1991, but thereupon the Company
became in default of its obligation.
Upon the Closing of the Acquisition Agreement, Epic acquired
the Bank Loan from the Bank and modified the payment terms
of the Bank Loan assigned to it and other indebtedness
of the Company to Epic. In October 1993, Epic assigned
and contributed to the capital of the Company all of such
indebtedness of the Company to Epic plus accrued and unpaid
interest. In addition, at the Closing, $3 million of
indebtedness (plus interest thereon) under the Bank Loan
was not acquired by Epic, pursuant to which the Bank, Epic
and the Company agreed that such portion of the Bank Loan (The
"Nonrecourse Obligations") be payable interest and then
principal only from operating receipts from "Triumph
of the Spirit" which was acquired by Epic pursuant
to the Acquisition Agreement.
As of November 30, 1995, Nova assigned to Epic and
Epic assumed the remaining $3 million Nonrecourse
Obligations plus interest thereon.
5) Liquidity and Capital Resources
At the current time, the Company's sole means to pay for
its overhead operations is its existing cash in the total
amount of $2,242. as of April 30, 2001. Accordingly,
the Company has significantly reduced its overhead.
The Company has no current business operations and is
in the process of seeking a business opportunity. As of
the date of this report, the Company has no agreement,
understanding or arrangement to acquire or participate
in any specific business opportunity. No assurance can
be given that the Company will be able to consummate
any such arrangements or, if consummated, that such business
opportunity will be successful. Management has indicated
that for the foreseeable future it will cover those
costs necessary to retain the Company's corporate charter,
file necessary tax returns, report to the Securities
and Exchange Commission, and cover certain expenses in
seeking business opportunities.
Item 2. Management's Discussion and Analysis or Plan of
Operation.
The following discussion should be read in conjunction
with the Financial Statements and Notes thereto and is qualified
in its entirety by the foregoing.
The Company had no revenues from operations for the three
and six months ended April 30, 2001 and for the three and six
months ended April 30, 2000. During the three and six months
ended April 30, 2001, the Company had a net loss of $(1,202)
and $(2,005), respectively, as compared to a net loss of
$(1,204) and $(4,024), respectively, during the three and six
months ended April 30, 2000.
On April 30, 2001, the Company had a working capital
deficit and stockholders' deficit of $(13,182), $2,242 in
cash, total assets of $2,242 and total liabilities of $15,424.
The working capital deficit and stockholders' deficit is
principally due to short term loans made by the President of the
Company in order to allow the Company to meet certain working
capital needs.
At the current time, the Company's sole means to pay for
its overhead operations is its existing cash in the total amount
of $2,242 as of April 30, 2001. Accordingly, the Company has
significantly reduced its overhead. In connection therewith,
the Company does not pay any officer salaries and rent. Its
costs primarily include only those costs necessary to retain its
corporate charter, file necessary tax returns and report to the
Securities and Exchange Commission, and certain expenses in
seeking business opportunities. Management has indicated that
for the foreseeable future it will cover those costs necessary
to retain the Company's corporate charter, file necessary tax
returns, report to the Securities and Exchange Commission, and
cover certain expenses in seeking business opportunities
In addition, as a result of the closing of the
Acquisition Agreement (see Notes to the Financial Statements
included elsewhere herein), the Company has no current business
operations and is in the process of seeking a business
opportunity. No assurance can be given that the Company will be
able to consummate any such arrangements or, if consummated,
that such business opportunity will be successful.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
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) Exhibits.
There are no exhibits applicable to this Form 10-QSB.
(b) Reports on Form 8-K.
Listed below are reports on Form 8-K filed during the
quarter for which this report is filed:
None.
SIGNATURES
In accordance with the requirements of the Exchange Act,
the Registrant caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
NOVA INTERNATIONAL FILMS, INC.
(Registrant)
Dated: May 31, 2001 By:/s/ William Rifkin
William Rifkin,
Chairman of the Board
(Principal Executive Officer)
Dated: May 31, 2001 By:/s/ William Rifkin
William Rifkin, Principal
Financial Officer