United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED APRIL, 30 2001
OR
[ ] TRANSITION REPORT PURSUANT SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE TRANSITION PERIOD .
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COMMISSION FILE NO. 33-26616
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GUMP & COMPANY, INC.
(Exact Name of Small Business Issuer in its Charter)
Delaware 75-2256798
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
192 Searidge Court
Shell Beach, CA 93449
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(Address of principal executive office) Zip Code
Issuer's telephone number: (805) 773-5350
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Check whether the Issuer (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 reports) and (2) has been subject to such filing requirements for the past
90 days. YES [X] NO [ ].
A very limited trading market exists for the common stock of Registrant. As of
May 31, 2001, nonaffiliates had 16,729 shares of which there is either a
nominal or zero market value.
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 2,033,201 as of May 31, 2001.
Transitional Small Business Disclosure Format: YES [ ] NO [X]
Form 10-QSB
PART I
Item 1 - Financial Statements
GUMP & COMPANY, INC.
Index to Financial Statements
For the Six Months Ended April 30, 2001 and
the Years Ended October 31, 2000, 1999 and 1998
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Financial Statements:
Balance Sheets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . .4
Statements of Stockholders' Equity. . . . . . . . . . . . . . . . . . .5
Statements of Cash Flows. . . . . . . . . . . . . . . . . . . . . . . .6
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . .7
GUMP & COMPANY, INC.
Balance Sheets
ASSETS
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April 30, October 31, October 31, October 31,
2001 2000 1999 1998
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Current Assets:
Cash $ 19,837 $ 0 $ 0 $ 0
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Total Current Assets and Assets 19,837 0 0 0
=========== ============= ============= ============
LIABILITIES AND STOCKHOLDERS' EQUITY
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Current Liabilities 0 0 0 0
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Total Current Liabilities 0 0 0 0
STOCKHOLDERS' EQUITY
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Preferred Stock - $.01 par value,
Authorized - 2,000,000 shares
Issued - None
Common Stock - $.01 par value,
Authorized - 20,000,000 shares
Issued - 2,033,201 shares at April 30,
2001 and 330,000 shares at October 31,
2000, 1999 and 1998 20,332 3,300 3,300 3,300
Additional paid-in-capital 36,605 33,637 33,637 33,637
Accumulated deficit (37,100) (36,937) (36,937) (36,937)
----------- ------------- ------------- ------------
Total Stockholders' Equity 19,837 0 0 0
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TOTAL LIABILITIES AND
EQUITY STOCKHOLDERS' $ 19,837 $ 0 $ 0 $ 0
=========== ============= ============= ============
The accompanying notes are an integral part of the financial statements.
GUMP & COMPANY, INC.
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 2001 AND
THE YEARS ENDED OCTOBER 31, 2000, 1999 AND 1998
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2001 2000 1999 1998
--------- -------- -------- --------
Revenues $ 0 $ 0 $ 0 $ 0
Expenses $ 163 $ 0 $ 0 $ 0
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NET INCOME (LOSS) $ (163) $ 0 $ 0 $ 0
========= ======== ======== ========
Net Income (loss) per share 0 0 0 0
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Weighted average number of outstanding
shares 447,201 330,000 330,000 330,000
========= ======== ======== ========
The accompanying notes are an integral part of the financial statements.
GUMP & COMPANY, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED APRIL 30, 2001 AND
THE YEARS ENDED OCTOBER 31, 2000, 1999 AND 1998
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ADDITIONAL
COMMON STOCK PAID-IN- ACCUMULATED
SHARES AMOUNT CAPITAL DEFICIT
----------- -------- --------- -------------
Balance at October 31, 1997 330,000 $ 3,300 $ 33,637 $ (36,937)
Net income (loss) 0
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Balance at October 31, 1998 330,000 3,300 33,637 $ (36,937)
Net income (loss) 0
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Balance at October 31, 1999 330,000 $ 3,300 $ 33,637 $ (36,937)
Net income (loss) 0
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Balance at October 31, 2000 330,000 $ 3,300 $ 33,637 $ (36,937)
One for ten reverse stock split (296,799) (2,968) 2,968
Issuance for cash proceeds 2,000,000 20,000
Net income (loss) (163)
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Balance April 30, 2001 2,033,201 $20,332 $ 36,605 ($37,100)
=========== ======== ========= =============
The accompanying notes are an integral part of the financial statements.
GUMP & COMPANY, INC.
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED APRIL 30, 2001 AND
THE YEARS ENDED OCTOBER 31, 2000, 1999 AND 1998
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2001 2000 1999 1998
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Cash Flows from operating activities:
Net income (loss) $ (163) $ 0 $ 0 $ 0
Adjustments to reconcile net income (loss) to net
cash provided (used in) operating activities 0 0 0 0
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Cash provided by (used in) operating activities (163) 0 0 0
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Cash Flows from Investing Activities: 0 0 0 0
Cash Flows from Financing Activities:
Proceeds from issuance of common stock 20,000 0 0 0
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Net Cash provided by Financing Activities 20,000 0 0 0
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Net Increase (Decrease) in cash 19,837 0 0 0
Cash at beginning of year 0 0 0 0
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Cash at end of year $19,837 $ 0 $ 0 $ 0
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The accompanying notes are an integral part of the financial statements.
GUMP & COMPANY, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2001, OCTOBER 31, 2000, 1999 AND 1998
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1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
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A. ORGANIZATION AND BUSINESS
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The Company was incorporated on September 28, 1988 under the laws of
the State of Delaware under the name of Brian Capital, Inc. On
September 15, 1993, the Company changed its name to Sea Pride
Industries, Inc. On August 18, 1997, the Company changed its name to
GUMP & COMPANY, INC. The Company is registered with the Securities and
Exchange Commission.
The Company was organized as an inactive, publicly held corporation to
pursue a business combination with a privately held entity believed to
have growth and profit potential, irrespective of the industry in
which it is engaged.
On September 10, 1993, stockholders of the Company exchanged 2,498,601
shares or approximately 75 percent of the issued and outstanding
capital stock of the Company for 126,192 shares of common stock of Sea
Pride Industries, Inc. In addition, the Company executed a one (1) for
ten (10) reverse stock split and increased the par value of the
authorized shares of common and preferred stock from $.001 per share
to $.01 per share. Consequently, the number of common shares issued
and outstanding decreased from 3,300,000 shares to 330,000 shares.
On June 7, 2000 the then principal stockholder, sole officer and
director of the Company sold all of his shares, totaling 249,792
shares, of the common stock of the Company. The new majority
shareholder became the sole officer and a director of the Company.
Effective on April 16, 2001 the Company executed a one (1) for ten
(10) reverse stock split. Consequently, the number of common shares
issued and outstanding decreased from 330,000 shares to 33,201 shares,
after rounding.
On April 25, 2001 the principal shareholder purchased 2,000,000 shares
of the Company's common stock at the stated par value.
B. LOSS PER SHARE
----------------
Loss per share of common stock is computed using the weighted number
of common shares outstanding during the period shown. Common stock
equivalents are not included in the determination of the weighted
average number of shares outstanding, as they would be antidilutive.
C. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
--------------------------------------------
In 1997, the Financial Accounting Standards Board (FASB) issued
Statements No. 130, Reporting Comprehensive Income and No. 131,
Disclosures about Segments of an Enterprise and Related Information.
The Company's adoption of these statements had no material impact on
the accompanying financial statements.
D. IMPAIRMENTS OF LONG LIVED ASSETS
------------------------------------
The Company evaluates its long-lived assets by measuring the carrying
amount of the assets against the estimated undiscounted future cash
flows associated with them. If such evaluations indicate the future
undiscounted cash flows of certain long-lived assets are not
sufficient to recover the carrying value of such assets; the assets
are adjusted to their fair values. No adjustment to the carrying
values of the assets has been made.
E. STATEMENT OF CASH FLOWS
--------------------------
Supplemental disclosure of cash flow information is as follows:
Cash paid during the period October 31, 1998 to April 30, 2001.
Interest 0
Income taxes 0
F. USE OF ESTIMATES
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The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that effect reported amounts of assets and liabilities
at the date of the financial statements, and revenues and expenses
during the reporting period. Actual results could differ from
estimates and assumptions made.
G. MANAGEMENT REPRESENTATION
--------------------------
The financial statements and notes are representations of the
Company's management, which is responsible for their integrity and
objectivity. They include all adjustments deemed necessary in order to
make the financial statements not misleading. Management represents
that these financial statements conform to generally accepted
accounting principles and have been consistently applied in the
preparation of the financial statements.
2. FAIR VALUE OF FINANCIAL INSTRUMENTS
---------------------------------------
The Company has used market information for similar instruments and applied
judgment to estimate fair value of financial instruments. At April 30, 2001
the fair value of cash, and accounts payable approximated carrying values
because of the short-term nature of these instruments.
3. COMMITMENTS AND CONTINGENCIES
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The Company is not presently involved in any litigation.
4. INCOME TAXES
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The Company presently owes no income taxes.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Company's Form
10-KSB and the consolidated financial statements for the year ended October 31,
2000, and the Company's Form 10-KSB and the consolidated financial statements
for the years ended January 31, 1999, 1998, 1997, 1996, 1995, 1994, and 1993.
The statements in this Quarterly Report on Form 10-QSB relating to matters that
are not historical facts, including but not limited to statements found in this
"Management's Discussion and Analysis of Financial Condition and Results of
Operations", are forward-looking statements that involve a number of risks and
uncertainties.
Gump & Company, Inc. (the "Company") was incorporated on September 28,
1988 under the laws of the State of Delaware. The Company had been delinquent
in its filings to the Securities and Exchange Commission since it failed to file
Form 10-KSB for the fiscal year ended October 31, 1993. As a result of a change
in control on June 7, 2000, management of the Company filed Form 10-QSB to cover
the six months ended April 30, 2000. The Company also filed Form 10-KSB to
cover the fiscal periods ended October 31, 1993 through October 31, 1999.
To date the Company's primary activities have been organizational ones,
directed at developing its business plan and raising its initial capital. The
Company has no commercial operations. The Company has no employees and owns no
real estate. The Company has no operating income and as of April 30, 2001, its
only asset is cash in the amount of $19,837.
The Company's business plan is to seek, investigate, and, if warranted,
acquire one or more properties or businesses, and to pursue other related
activities intended to enhance shareholder value. The acquisition of a business
opportunity may be made by purchase, merger, exchange of stock, or otherwise,
and may encompass assets or a business entity, such as a corporation, joint
venture, or partnership. The Company has very limited capital, and it is
unlikely that the Company will be able to take advantage of more than one such
business opportunity. The Company intends to seek opportunities demonstrating
the potential of long-term growth as opposed to short-term earnings.
Current Assets
Current assets of $19,837 at April 30, 2001 exceeded the January 31, 2001 amount
by $19,837. This increase reflects the $20,000 proceeds from 2,000,000 common
shares sold during the three months ended April 30, 2001, less funds used for
operations during the quarter.
Expenses
Expenses of $163 for the quarter ended April 30, 2001 exceeded the January 31,
2001 Amount by $163. This increase reflects funds used for operations during the
quarter.
Net Loss
Net Loss of $163 for the quarter ended April 30, 2001 exceeded the January 31,
2001 Amount by $163. This increase reflects funds used for operations during the
quarter.
Liquidity and Capital Resources
The Company's plan of operations for the next twelve months is to continue
to carry out its plan of business discussed above. This includes seeking to
complete a merger or acquisition transaction with a small or medium-sized
enterprise which desires to become a public corporation. In selecting a
potential merger or acquisition candidate, the Company will consider many
factors, including, but not limited to, potential for growth and profitability,
quality and experience of management, capital requirements, and the ability of
the Company to qualify its shares for trading on NASDAQ or on an exchange.
The types of business enterprises which it is believed might find a
business combination with the Company to be attractive include acquisition
candidates desiring to create a public market for their shares in order to
enhance liquidity for current shareholders, acquisition candidates which have
long-term plans for raising capital through the public sale of securities and
believe that the possible prior existence of a public market for their
securities would be beneficial, foreign companies desiring to obtain access to
U.S. customers and U.S. capital markets, and acquisition candidates which plan
to acquire additional assets through issuance of securities rather than for
cash, and believe that the possibility of development of a public market for
their securities will be of assistance in that process. Acquisition candidates
which have a need for an immediate cash infusion are not likely to find a
potential business combination with the Company to be an attractive alternative.
Although it has had preliminary discussions with several potential merger
or acquisition candidates, the Company is unable to predict when it may
participate in a business opportunity. It has not established any deadline for
completion of a transaction, and anticipates that the process could continue
throughout the next twelve months.
The Company's balance sheet for the three months ended April 30, 2001,
reflects current assets of $19,837 and current liabilities in the amount of $0.
Accordingly, the Company may be required to raise additional funds, or its
shareholders will be required to advance funds in order to pay its current
liabilities and to satisfy the Company's cash requirements for the next twelve
months.
Results of Operations
In the fiscal year ended October 31, 1993 the Company had revenues of
$4,384 and expenses of $2,870 net income of $1,514. Since 1993, the Company has
had no revenue, expenses, income or loss, except in the last quarter ended April
30, 2001 when the Company had expenses and a loss of $163. The Company does not
anticipate a significant change in the results of operations until such time as
a business combination is consummated, if ever.
PART II - OTHER INFORMATION
Item 5. Other Information
Recent Sales of Unregistered Securities
On April 25, 2001 the sole officer, director and principal shareholder of
the Company purchased 2,000,000 shares of the Company's common stock at the
stated par value. This offering was a private placement, and in the opinion of
legal counsel for the Company, was exempt from registration under Section 4(2)
of the Securities Exchange Act of 1934. The principal shareholder represented
his intention to acquire the shares for investment purposes only, and not with a
view to resale or distribution, and appropriate restrictive legends were placed
on each stock certificate issued pursuant to this offering.
Item 6. Exhibits and Reports on Form 8-K
A report on Form 8-K, dated April 4, 2001, was filed on April 4, 2001
reporting that on April 4, 2001, the Company declared that effective April 16,
2001, the Company would effect a one-for-ten reverse split of its common stock.
The record date for the reverse stock split was April 16, 2001. All fractional
shares were increased to the next highest whole number of shares.
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GUMP & COMPANY, INC.
Date: June 7, 2001
By: /s/ Mark A. DiSalvo
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Mark A. DiSalvo
President, Chief Executive Officer and Chief Financial Officer
INDEX TO EXHIBITS
The Exhibits listed below are filed as part of this Report on Form
10-QSB.
Exhibit
No. Document
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2.1 Articles of Incorporation (incorporated by
reference to Form S-1 filed with the Securities and Exchange
Commission on behalf of the Company on January 26, 1989)
2.2 Bylaws (incorporated by reference to
Form S-1 filed with the Securities and Exchange Commission
on behalf of the Company on January 26, 1989)
2.3 Certificate of Amendment of Certificate of Incorporation filed
September 2, 1997. (incorporated by reference to Form 10-KSB filed with
the Securities and Exchange Commission on behalf of the Company
on July 3, 2000)
2.4 Certificate of Amendment of Certificate of Incorporation filed
September 27, 1993. (incorporated by reference to Form 10-KSB filed
with the Securities and Exchange Commission on behalf of the Company
on July 3, 2000)
3.1 Specimen Stock Certificate (incorporated by reference to Form 10-KSB
filed with the Securities and Exchange Commission on behalf of the
Company on July 3, 2000)