FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 2002
OR
[ ] 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 000-33247
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COPPER CORPORATION
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(Exact name of registrant as specified in its charter)
Colorado 84-1493157
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3088 SE Gabler 55313
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(Address of principal executive office) (Zip Code)
(763) 477-6027
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(Registrant's telephone number, including area code)
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), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
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The number of shares outstanding of each of Issuer's classes of common equity as
of December 14, 2002.
Common Stock, par value $.0001 2,530,000
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Title of Class Number of Shares
Transitional Small Business Disclosure Format yes no X
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Page
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Part I: Financial information
Item 1. Financial Statements
Consolidated Condensed Balance Sheet as of October 31, 2002
(unaudited) .................................................... 3
Consolidated Condensed Statements of Operations for the three
and six months ended October 31, 2002 and 2001 (unaudited) .... 4
Consolidated Condensed Statement of Changes in Shareholders'
Deficit for the six months ended October 31, 2001 (unaudited) . 5
Consolidated Condensed Statements of Cash Flows for the three
and six months ended October 31, 2002 and 2001 (unaudited) .... 6
Notes to Consolidated Condensed Financial Statements (unaudited) 7
Item 2. Plan of Operation .............................................. 8
Part II: Other Information .............................................. 9
Signatures ..................................................... 10
Exhibits ....................................................... 11
COPPER CORPORATION
Consolidated Condensed Balance Sheet
July 31, 2002
(unaudited)
Assets
$ --
========
Liabilities and Shareholders' Deficit
Liabilities:
Accounts payable and accrued liabilities...................... $ 3,543
--------
Total liabilities 3,543
Shareholders' deficit:
Preferred stock............................................... --
Common stock.................................................. 2,673
Additional paid-in capital.................................... 12,641
Deficit accumulated during the development stage.............. (18,857)
--------
Total shareholder's deficit (3,543)
--------
$ --
========
See accompanying notes to consolidated condensed financial statements
3
COPPER CORPORATION
Consolidated Condensed Statements of Operations
(unaudited)
Three Months Ended Six Months Ended
October 31, October 31,
------------------------- --------------------------
2002 2001 2002 2001
----------- ----------- ----------- -----------
Costs and expenses:
Contributed rent ....................................... $ -- $ 300 $ 600 $ 600
General and administrative ............................. -- 768 7,357 1,018
----------- ----------- ----------- -----------
-- 1,068 7,957 1,618
----------- ----------- ----------- -----------
Loss before income taxes -- (1,068) (7,957) (1,618)
Income tax provision ................................... -- -- -- --
----------- ----------- ----------- -----------
Net loss ................................ $ -- $ (1,068) $ (7,957) $ (1,618)
=========== =========== =========== ===========
Basic and diluted loss per share ........................... $ -- $ (0) $ (0) $ (0)
Weighted average common shares outstanding ................. 2,530,000 1,230,000 1,849,048 1,230,000
=========== =========== =========== ===========
See accompanying notes to consolidated condensed financial statements
4
COPPER CORPORATION
Consolidated Condensed Statement of Changes in Shareholders' Deficit
(unaudited)
Deficit
Accumulated
Common Stock Additional During the
----------------------- paid-in Development
Shares Amount Capital Stage Total
---------- ---------- ---------- ---------- ----------
Balance at
April 30, 2002 ................ 1,230,000 2,673 6,727 (10,900) (1,500)
Contributed rent (Note 2) ....... -- -- 600 -- 600
Contributed services (Note 2) ... -- -- 1,225 -- 1,225
Related party payment of costs on
behalf of Company (Note 2) .. -- -- 4,089 -- 4,089
Issuance of common stock
for subsidiary .............. 1,300,000 -- -- -- --
Net income/loss ................. -- -- -- (7,957) (7,957)
---------- ---------- ---------- ---------- ----------
Balance at
October 31, 2002 ................ 2,530,000 $ 2,673 $ 12,641 $ (18,857) $ (3,543)
========== ========== ========== ========== ==========
See accompanying notes to consolidated condensed financial statements
5
COPPER CORPORATION
Consolidated Condensed Statements of Cash flows
(unaudited)
Six Months Ended
October 31,
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2002 2001
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Net cash used in operating activities .......................................... $(5,914) $(1,500)
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Cash flows from financing activities:
Contributed capital by an affiliate ........................................ 5,914 1,600
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Net cash provided by financing activities ............................... 5,914 1,600
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Net change in cash ................................................... -- 100
Cash:
Cash, beginning of period .................................................. -- --
------- -------
Cash, end of period ........................................................ $ -- $ 100
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Supplemental disclosure of cash flow information: Cash paid during the year for:
Income taxes ............................................................ $ -- $ --
======= =======
Interest ................................................................ $ -- $ --
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See accompanying notes to consolidated condensed financial statements
6
COPPER CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1: Basis of Presentation
The consolidated condensed financial statements presented herein have been
prepared by the Company in accordance with the accounting policies in its
audited financial statements for the year ended April 30, 2002 filed in its Form
10-KSB and should be read in conjunction with the notes thereto. The Company
plans to evaluate, structure and complete a merger with (or acquisition of) a
privately owned corporation.
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) which are necessary to provide a fair presentation of
operating results for the interim period presented have been made. The results
of operations for the six month period ended October 31, 2002 are not
necessarily indicative of the results to be expected for the year.
Interim financial data presented herein are unaudited.
Note 2: Related Party Transactions
During the six months ended October 31, 2002, management provided free office
space to the Company, on an as needed basis. During the six months ended October
31, 2001, Corporate Management Services, the former controlling shareholder of
the Company, provided free office space to the Company, on an as needed basis.
The Company's Board of Directors valued this free service at approximately $100
per month, based on prevailing local market rates. The accompanying consolidated
condensed financial statements include a charge to rent expense and a credit to
paid-in capital of $600 and $600, for the six months ended October 31, 2002 and
2001, respectively.
During the six months ended October 31, 2002, management provided their time and
effort to the Company, on an as needed basis, at no charge to the Company. The
Company's Board of Directors valued this free service at approximately $25 per
hour, based on prevailing local market rates.
An affiliate paid certain administrative costs on behalf of the Company, on an
as needed basis, for all periods presented in the accompanying financial
statements. The costs, consisting of legal, accounting and filing fees, are
necessary for the Company to maintain its reporting status in conformity with
the provisions Securities and Exchange Act of 1934, as amended. During the six
months ended October 31, 2002 the affiliate paid $2,791 in legal, accounting,
and general and administrative costs on behalf of the Company, which the Company
recorded as a charge to operations with a corresponding credit to contributed
capital in the accompanying condensed financial statements.
Note 3: Income Taxes
The Company records its income taxes in accordance with Statement of Financial
Accounting Standard No. 109, "Accounting for Income Taxes". The Company incurred
net operating losses during the periods shown on the accompanying unaudited
condensed financial statements resulting in a deferred tax asset, which was
fully allowed for; therefore, the net benefit and expense result in $-0- income
taxes.
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COPPER CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Item 2. Plan of Operations.
General
The Company acquired a subsidiary on June 25, 2002 in order to facilitate the
sale of a majority interest in the common stock of the Company. The subsidiary,
American Real Estate Investors, Inc., has no assets or business; it is a dormant
shell company.
The plan of the Company's management, for the next twelve months, is to focus on
acquiring an operating entity. Management has been seeking possible merger
candidates and expects to consummate a transaction in the near future. Certain
members of management plan to work, deferring payment of compensation, to seek
and evaluate potential merger candidates. Principal shareholders plan to
underwrite the Company's obligations until such time as a merger is completed.
The Company has no full-time employees, incurs nominal rent and administrative
expenses and has no other recurring operating expenses, except for those
professional fees and expenses necessary to maintain its reporting status under
the Securities and Exchange Act of 1934, as amended. The Company anticipates
raising no capital over the next twelve months. The Company has no plans to
acquire any assets or make any investments prior to completing a merger.
To date, the Company has identified no suitable merger candidates. Management
has no particular type of merger candidate in mind. No restrictions have been
placed on management's discretion to seek out and participate in an appropriate
merger.
Selection of an appropriate merger candidate is complex and risky due to the
lack of Company financial resources, the speculative nature of such a
transaction, management's limited time commitment to the Company, management's
potential conflicts of interest, the burdens of being a reporting company, and
competition in the marketplace. There is no assurance that the Company will be
successful in consummating a merger with a privately held company or that such a
merger will result in profitable operations.
Special note regarding forward-looking statements
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This report contains forward-looking statements within the meaning of federal
securities laws. These statements plan for or anticipate the future.
Forward-looking statements include statements about our future business plans
and strategies, statements about our need for working capital, future revenues,
results of operations and most other statements that are not historical in
nature. In this Report, forward-looking statements are generally identified by
the words "intend", "plan", "believe", "expect", "estimate", and the like.
Investors are cautioned not to put undue reliance on forward-looking statements.
Except as otherwise required by applicable securities statues or regulations,
the Company disclaims any intent or obligation to update publicly these
forward-looking statements, whether as a result of new information, future
events or otherwise. Because forward-looking statements involve future risks and
uncertainties, these are factors that could cause actual results to differ
materially from those expressed or implied.
Part II: Other Information
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COPPER CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Item 1: Legal Proceedings
No report required.
Item 2: Changes in Securities
No report required.
Item 3: Defaults upon Senior Securities
No report required.
Item 4: Submission of Matters to a Vote of Security Holders No report required.
Item 5: Other information
No report required.
Item 6: Exhibits and Reports on Form 8-K
(a). Exhibits:
1. 99.1: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
- CEO
2. 99.2: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
- CFO
(b). One Form 8-K was filed on during the period covered by this report.
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SIGNATURES
The financial information furnished herein has not been audited by an
independent accountant; however, in the opinion of management, all adjustments
(only consisting of normal recurring accruals) necessary for a fair presentation
of the results of operations for the six months ended June 30, 2002 have been
included.
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COPPER CORPORATION
Date: December 14, 2002 By: /s/ Roger W. Sherman
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Roger W. Sherman, President
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