11
UNITED
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2002
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( ) 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 0-25541
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CIGAR KING CORPORATION
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(Exact name of registrant as specified in charter)
Nevada 91-1948357
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
42 - 2951 Panorama Drive
Coquitlam, BC, Canada V3E 2W3
- ----------------------- --------
(Address of principal executive offices) (Zip Code)
604-941-4244
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Registrant's telephone number, including area code
(Former name, address, and fiscal year, if changed since last report)
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 reports), Yes [X] No [ ] and ( ) has
been subject to 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 last practicable date.
Class Outstanding as of March 31, 2002
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Common Stock, $0.001 per share 10,535,000
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INDEX
PAGE
NUMBER
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PART 1.
ITEM1.. . . . Financial Statements . 3
Balance Sheet as at March 31, 2002
and September 30, 2001. . . . . . . . . . . . . . . 4
Statement of Operations
For the three months ended March 31, 2002 and 2001,
For the six months ended March 31, 2002 and 2001
and for the period from October 8,1998 (Date of
Inception) to March 31, 2002. . . . . . . . . . . . 5
Statement of Cash Flows
For the six months ended March 31, 2002 and 2001
and for the period from October 8,1998 (Date of
Inception) to March 31, 2002. . . . . . . . . . . . 6
Notes to Financial Statements. . . . . . . . . . . . . . 7
ITEM 2. Plan of Operations 9
PART 11. . . . Signatures 10
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PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The accompanying balance sheet of Cigar King Corporation (a development stage
company) at March 31, 2002 and the statement of operations for the three and six
months ended March 31, 2002 and 2001, and for the period from October 8, 1998
(date of inception) to March 31, 2002 and the statement of cash flow for the six
months ended March 31, 2002 and 2001 and for the period from October 8, 1998
(date of inception) to March 31, 2002 have been prepared by the Company's
management in conformity with accounting principles generally accepted in the
United States of America. In the opinion of management, all adjustments
considered necessary for a fair presentation of the results of operations and
financial position have been included and all such adjustments are of a normal
recurring nature.
Operating results for the three months ended March 31, 2002, are not necessarily
indicative of the results that can be expected for the year ending September 30,
2002.
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CIGAR KING CORPORATION
(A Development Stage Company)
BALANCE SHEET
March 31, 2002 and September 30, 2001
(Unaudited - Prepared by Management)
MARCH 31, September 30,
2002 2001
------------ ---------------
ASSETS
CURRENT ASSETS
Bank. . . . . . . . . . . . . . . . . . . . . . . . . $ 18 $ 2
------------ ---------------
TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . . . . . $ 18 $ 2
============ ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities . . . . . . $ 13,460 $ 13,267
Accounts payable - related parties . . . . . . . . . 1,341 1,206
------------ ---------------
TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . . . . . 14,801 14,473
------------ ---------------
STOCKHOLDERS' EQUITY
Common stock
200,000,000 shares authorized, at $0.001 par
value, 10,535,000 shares issued and outstanding 10,535 10,535
Capital in excess of par value. . . . . . . . . . . . 78,165 78,165
Deficit accumulated during the development stage. . . (103,483) (99,871)
------------ ---------------
Total Stockholders' Deficiency. . . . . . . . . (14,783) (11,171)
------------ ---------------
$ 18 $ 2
============ ===============
The accompanying notes are an integral part of these unaudited financial
statements.
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CIGAR KING CORPORATION
(A Development Stage Company)
STATEMENT OF OPERATIONS
For the three and six months ended March 31, 2002 and 2001,
and for the period from October 8, 1998 (Date of Inception) to March 31, 2002
(Unaudited - Prepared by Management)
FOR THE FOR THE
FOR THE THREE FOR THE THREE SIX SIX
MONTHS MONTHS MONTHS MONTHS FROM INCEPTION
ENDED ENDED ENDED ENDED TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2002 2001 2002 2001 2002
--------------- --------------- ------------- ------------ ----------------
SALES . . . . . . . . . . . . . . . . . $ - $ - $ - $ - $ -
=============== --------------- ------------- ------------ ----------------
GENERAL AND ADMINISTRATIVE EXPENSES:
Loss of license. . . . . . . . . . - - - - 50,000
Accounting and audit . . . . . . . 950 950 1,900 1,900 19,350
Bank charges and interest. . . . . 17 16 34 35 381
Consulting . . . . . . . . . . . . - - - - 9,650
Filing fees. . . . . . . . . . . . - - - 225 2,957
Legal. . . . . . . . . . . . . . . - - - - 110
Office and administrative
expenses . . . . . . . . . . . 14 - 14 208 3,432
Rent . . . . . . . . . . . . . . . - - - - 4,500
Telephone. . . . . . . . . . . . . - - - - 2,700
Transfer agent's fees. . . . . . . 122 56 1,664 1,484 7,903
Travel . . . . . . . . . . . . . . - - - - 2,000
Website fees . . . . . . . . . . . - - - - 500
--------------- --------------- ------------- ------------ ----------------
NET LOSS. . . . . . . . . . . . . . . . $ (1,103) $ (1.022) $ ( 3,612) $ (3,852) $ ( 103,483)
=============== =============== ============= ============ ================
NET LOSS PER COMMON SHARE
Basic. . . . . . . . . . . . . . . $ - $ - $ - $ -
=============== =============== ============= ============
AVERAGE OUTSTANDING SHARES
Basic. . . . . . . . . . . . . . . 10,535,000 10,535,000 10,535,000 10,535,000
=============== =============== ============= ============
The accompanying notes are an integral part of these unaudited financial
statements.
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CIGAR KING CORPORATION
(A Development Stage Company)
STATEMENT OF CASH FLOWS
For the six months ended March 31, 2002 and 2001 and for the period from
October 8, 1998 (Date of Inception) to March 31, 2002
(Unaudited - Prepared by Management)
FOR THE For the
SIX Six FROM
MONTHS Months INCEPTION
ENDED Ended TO
MARCH 31, March 31, MARCH 31,
2002 2001 2002
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CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (3,612 $ (3,852) $ (100,633)
Adjustments to reconcile net loss to net cash provided by operating activities:
Changes in current assets and liabilities:
Capital contributions - expenses . . . . . . . . . . . . . . . . . . . . . . . . - - 10,950
Accounts payable - related parties . . . . . . . . . . . . . . . . . . . . . . . 135 - 1,341
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,493 3,705 13,460
---------- ------------ -----------
Net cash (deficiency) from operations . . . . . . . . . . . . . . . . . . . . . . 16 (147) (77,732)
---------- ------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
- - -
---------- ------------ -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock. . . . . . . . . . . . . . . . . . . . . . - - 77,750
---------- ------------ -----------
Net Increase (Decrease) in Cash. . . . . . . . . . . . . . . . . . . . . . . 16 (147) 18
Cash at Beginning of Period. . . . . . . . . . . . . . . . . . . . . . . . . 2 160 -
---------- ------------ -----------
CASH AT END OF PERIOD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 18 $ 13 $ 18
========== ============ ===========
The accompanying notes are an integral part of these unaudited financial
statements.
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CIGAR KING CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
March 31, 2002
(Unaudited - Prepared by Management)
1. ORGANIZATION
The Company was incorporated under the laws of the State of Nevada on October 8,
1998 with the authorized common shares of 200,000,000 shares at $0.001 par
value.
The Company was organized for the purpose of engaging in quality cigar sales.
The company has since abandoned the Cigar King concept and is looking for
another project. No operations have been started.
Since its inception the Company has completed Regulation D offerings of
10,535,000 of its common capital stock for cash.
The Company is in the development stage.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
- -------------------
The Company recognizes income and expenses based on the accrual method of
accounting.
Dividend Policy
- ----------------
The Company has not yet adopted a policy regarding payment of dividends.
Income Taxes
- -------------
On March 31, 2002 the Company had a net operating loss carry forward of
$100,633. The tax benefit of $30,190 from the loss carry forward has been fully
offset by a valuation reserve because the use of the future tax benefit is
doubtful since the Company is in the development stage and has not started
operations. The net operating loss will expire in 2023.
Earnings (Loss) per Share
- ----------------------------
Earnings (loss) per share amounts are computed based on the weighted
average number of shares actually outstanding.
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CIGAR KING CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
March 31, 2002
(Unaudited - Prepared by Management)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Cash and Cash Equivalents
- ----------------------------
The Company considers all highly liquid instruments purchased with a maturity,
at the time of purchase, of less than three months, to be cash equivalents.
Comprehensive Income
- ---------------------
The Company adopted Statement of Financial Accounting Standards No. 130. The
adoption of this standard had no impact on the total stockholder's equity.
Recent Accounting Pronouncements
- ----------------------------------
The Company does not expect that the adoption of other recent accounting
pronouncements will have a material impact on its financial statements.
Financial Instruments
- ----------------------
The carrying amounts of financial instruments, including cash and accounts
payable are considered by management to be their estimated fair values.
Estimates and Assumptions
- ---------------------------
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
3. RELATED PARTY TRANSACTIONS
Related parties acquired 43% of the common stock issued.
4. GOING CONCERN
Continuation of the Company as a going concern is dependent upon obtaining
additional working capital and the management of the Company has developed a
strategy, which it believes will accomplish this objective through additional
equity funding, and long term financing, which will enable the Company to
operate for the coming year.
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ITEM 2. PLAN OF OPERATIONS
Current government regulations go against the development of a cigar kiosk
business. In British Columbia smoking is not permitted on business premises, or
in restaurants, and people have to smoke outside in most cases. Also, smoking
is frowned upon for health reasons in our aging society. As a result, any
business relating to marketing tobacco will have difficulties. The Company has
decided to abandon its Cigar King concept.
Management now plans to look for a new project to invest in as soon possible and
has some potential projects in mind.
Liquidity and Capital Resources
- ----------------------------------
The directors have been personally advancing funds to the Company in order to
meet its current obligations and plan to still do so until a viable project is
found.
Results of Operations
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The Company has had no revenues from operations since its inception.
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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.
CIGAR KING CORPORATION
(Registrant)
June 6, 2002 /s/ "Michael J. Kennaugh"
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Date Michael J. Kennaugh - Director
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