U.S. Securities and Exchange Commission
Washington, D.C. 20549
Amendment 1 to
FORM 10-QSB
[ X ] QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE EXCHANGE ACT
For the transition period from: to:
Commission file number: 33-26899-D
BEST OF AMERICA CORPORATION
(Exact Name of Registrant as specified in its charter)
COLORADO 84-1082394
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation or organization
27690 Main Street
Lacombe, Louisiana 70445
(Address code of principal executive offices)
(504) 646-0261
(Issuers telephone number)
Check mark whether the Issuer (1) has filed all reports required
by Section 13 or 15(d) of the Exchange Act during the preceding 12
months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to the filing
requirements for at least the past 90 days. YES: X NO:
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PREVIOUS FIVE YEARS
Check 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
the court. YES: NO:
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuers
classes of common stock, as of the last practicable date: 9,729,000
Transitional Small Business Disclosure Format. YES: NO: X
2
BEST OF AMERICA CORPORATION
Index
PART I FINANCIAL INFORMATION
Balance Sheet
March 31, 1998 3
Statements of Operations
Three Months
Ended March 31, 1998 and 1997 4
Statements of Cash Flows
Three Months Ended
March 31, 1998 and 1997 5
Notes to Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7-8
PART II
Other Information 9
Signatures 9
3
Best of America Corporation
Balance Sheet
March 31, 1998
(Unaudited)
ASSETS
Current assets:
Accounts receivable, net of allowance for
doubtful accounts of $ 7,333 $ 3,360
Inventory 14,658
Note receivable - trade 27,743
Contract receivable 48,925
Prepaid expenses 55,282
Due from related parties 30,024
Total current assets =======
179,992
Property and equipment, at cost, net of
accumulated depreciation of $34,093 10,649
Land 469,151
Patents and formulas, at cost, net of
accumulated amortization of $6,287 3,800
Option 1,500
Deposits 25,565
-------
$ 690,657
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 319,858
Due to related parties 113,772
Note payable-current portion 11,750
Customer deposits 15,000
-------
Total current liabilities 460,380
Note payable-net of current portion 29,762
Commitments and contingencies
Stockholders' equity:
Preferred stock, $10 par value, non-voting,
non-cumulative, non participating,
convertible, 50,000,000 shares authorized
216,200 shares issued and outstanding 2,162,000
Discount below par on preferred stock (1,732,532)
Common stock, no par value,
1,000,000,000 shares authorized,
9,729,000 shares issued and outstanding 1,444,930
Less: stock subscription receivable (998,000)
Paid in capital 26,647
Accumulated deficit (702,530)
---------
200,515
$ 690,657
=========
See accompanying notes to financial statements.
4
Best of America Corporation
Statements of Operations
For the Three Months Ended March 31, 1998 and 1997
(Unaudited)
1998 1997
Sales $ 18,439 $ 20,986
Cost of sales 7,540 10,584
------ ------
Gross margin 10,899 10,402
General and administrative expenses 68,760 33,478
------ ------
Income (loss) from operations (57,861) (23,076)
Other income and (expense):
Miscellaneous income 500 15
Interest expense (14,118) (7,190)
------ -----
(13,618) (7,175)
Net income (loss) $ (71,479) $ (30,251)
======== =======
Basic (loss) per share ($0.01) ($0.00)
Weighted average shares outstanding 9,529,000 8,129,000
========= ==========
See accompanying notes to financial statements.
5
Best of America Corporation
Statement of Cash Flows
For the Three Months Ended March 31, 1998 and 1997
(Unaudited)
1998 1997
Net cash provided by (used in) operating activities $ (114,887) $ (98,336)
Cash flows from investing activities:
Note receivable - trade issued (500) -
Acquisition of office equipment (731) (1,293)
------- -----
Net cash (used in) investing activities (1,231) (1,293)
Cash flows from financing activities:
Proceeds from related parties 16,657 48,890
Proceeds from note payable 992 -
Common stock issued for cash 96,000 -
------- ------
Net cash provided by financing activities 113,649 48,890
------- ------
Increase (decrease) in cash (2,469) (50,739)
Cash and cash equivalents,
beginning of period
Cash and cash equivalents, 2,469 51,437
----- ------
end of period $ - $ 698
========= =======
See accompanying notes to financial statements.
6
Best of America Corporation
Notes to Financial Statements
The accompanying condensed unaudited financial statements have been
prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to form 10-QSB. Accordingly, they do not include all
of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair presentation
have been included. The results of operations for the periods
presented are not necessarily indicative of the results to be
expected for the full year. The accompanying financial statements
should be read in conjunction with the Company's form 10-KSB filed
for the year ended December 31, 1997.
Basic (loss) per share was computed using the weighted average
number of common shares outstanding.
BASIS OF PRESENTATION
The accompanying financial statements have been prepared on a
"going concern" basis which contemplates the realization of assets
and the liquidation of liabilities in the ordinary course of
business.
The Company has incurred operating losses during the periods ended
March 31, 1998, and 1997, aggregating $71,479 and $30,251, and has
negative working capital of $280,388 at March 31, 1998.
During the periods presented the Company has not generated positive
cash flow from operations and there can be no assurance that the
trend will not continue. Profitable operations are dependent upon,
among other factors, the Company's ability to obtain equity or debt
financing and the Company's ability to finance, manage, and
construct car wash operations.
The Company is unable to project a level of revenue which would
allow a reversal of its history of operating losses in the near
future. In this regard the Company has undertaken the raising
of additional equity capital and debt financing. The Company's
continued operations are dependent upon obtaining financing.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Trends and Uncertainties: The Company is structured so that it can
adjust to the trends and uncertainties in the automobile service
industry. The Company has tied to eliminate the major variables of
interest rates and operating expenses. However, as the Company has
little or no control over the demand for its products and/or
services, inflation and changing prices could have a material
effect on the future profitability of the Company.
Capital and Sources of Liquidity: During the three months ended
March 31, 1998 the Company's principal source of funding was
derived from operations, loans from shareholders and proceeds from
the sale of common stock.
The Company's sources of liquidity for the remainder of 1998 are
expected to be generated from efforts to raise additional capital
and advances from affiliates. This capital is essential to the
continued operation of the Company. See the discussion of Capital
Resources included in the Company's Report on Form 10-KSB for the
year ended December 31, 1997 for additional information.
The Company currently has no material commitments for capital
expenditures. The Company recently moved its offices and increased
its lease obligation from a base rental of $644.50 per month to
$1,200 per month under the terms of an operating lease that expires
on February 1, 2000. The monthly lease payments will increase to
$1,400 and $1,600 during the second and third year of the lease. In
addition, 800 square feet of storage space for its parts and
chemicals is leased on a month-to-month basis for a monthly rent of
$220. The increased lease payments have a negative effect on the
cash flow of the Company. The Company believes that its existing
facilities are adequate to meet its needs for the foreseeable
future.
The Company purchased office equipment of $731 and paid $500 for a
trade note receivable during the three months ended March 31, 1998,
resulting in net cash used in investing activities of $1,231.
The Company purchased office equipment of $1,293 during the three
months ended March 31, 1997, resulting in net cash used in
investing activities of $1,293.
The Company received advances from shareholders of $16,657,
proceeds from the sale of common stock of $96,000, and proceeds
from a note payable of $992 during the three months ended March 31,
1998, resulting in net cash provided by financing activities of
$113,649.
The Company received advances from shareholders of $48,890 during
the three months ended March 31, 1997, resulting in net cash
provided by financing activities of $48,890.
Results of Operations:
The Company has not generated positive cash flow from operations
and there can be no assurance that the trend will not continue.
Profitable operations are dependent upon, among other factors, the
Company's ability to obtain equity or debt financing and the
Company's ability to finance, manage, and construct car wash
operations, and acquire manufacturing equipment.
The Company is unable to project a level of revenue which would
allow a reversal of its history of operating losses in the near
future. In this regard the Company has undertaken the raising
of additional equity capital and debt financing. The Company's
continued operations are dependent upon obtaining financing.
1998 Compared to 1997: For the three months ended March 31, 1998,
the Company experienced a net loss of $71,479 compared to a net
loss of $30,251 for the three months ended March 31, 1997. The
Company experienced negative cash flow from operating activities of
$115,254 for the three months ended March 31, 1998 compared to
negative cash flow from operations of $98,336 for the three months
ended March 31, 1997.
The Company received revenue of $18,439 for the three months ended
March 31, 1998, compared to $20,986 for the three months ended
March 31, 1997.
Cost of sales decreased from $10,584 during the three months ended
March 31, 1997, to $7,540 during the three months ended March 31,
1998, due to decreased merchandise sales.
General and administrative expenses increased from $33,478 during
the nine months ended March 31, 1997, to $68,760 during the three
months ended March 31, 1998, due to more money spent to acquire
financing.
8
The Company's interest expense increased from $7,190 during the
three months ended March 31, 1997, to $14,118 during the three
months ended March 31, 1998.
9=
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Not applicable.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Not applicable.
(b) Not applicable.
SIGNATURES
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.
Best of America Corporation
(Registrant)
Dated:July 8, 1998
By: /s/ Michael Yates
- ----------------------------
Acting President