<pre>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 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 September 30, 2002
[ ] Transition report under section 13 or 15(d) of the Securities Exchange Act
of 1934 [no fee required]
Commission File Number 000-3149
MEDIABUS NETWORKS,INC.
(Exact name of registrant as specified in its charter)
Florida 65-0832987
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
2900 Delk Road
Suite 700
PMB 113
Marietta, GA 30067
(Address of principle executive offices) (Zip Code)
Registrant's telephone number, including area code: (770) 977-0944
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(b) 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.[X]Yes[ ]No
Common Stock, issued and outstanding as of December 26, 2002: 7,841,798.
PART I
Item 1. Financial Statement
MediaBus Networks, Inc.
formerly B Y & C Management, Inc.
(A Development Stage Enterprise)
<table>
Balance Sheet
September 30, June 30,
2002 2002
---------------- --------------
(Unaudited) (Audited)
<c> <c>
ASSETS
Current assets:
Cash and cash equivalents $ 0 $ 85
Trade Receivable -
Inventories 0 -
Income tax receivables 0 -
Other 0 -
-------------- --------------
Total current assets $ 0 $ 85
============== ==============
Investments
Goodwill - -
Long-term receivables - -
Furniture, fixtures & Equip. - -
Property and equipment, net - -
Other assets - -
---------------- ------------------
Total assets $ 0 $ 85
================ ==================
LIABILITIES
Current liabilities:
Accounts Payable $ $ 23,391
Accrued Liabilities 833
Advances from officers 55,134
Other current liabilities 25,000
---------------- ------------------
Total current liabilities $ $ 104,358
================ ==================
STOCKHOLDERS' EQUITY
Shareholders Equity (deficiency)
Preferred Stock
par value at $0.001, 50,000,000 shares
authorized, none issued and outstanding - -
Common Stock
par value at $0.001, 100,000,000 shares
authorized, 7,841,798 and 7,035,000 shares
issued and outstanding, respectively 7,842 7,842
Additional Paid In Capital 663,561 663,561
Accumulated deficit (775,676) (775,676)
---------------- -------------------
Total Shareholders Equity (deficit) (104,273) (104,273)
----------------- -------------------
Total Liabilities & Shareholders Equity 85 85
================== ===================
</table>
MediaBus Networks, Inc.
formerly B Y & C Management, Inc.
(A Development Stage Enterprise)
Statement of Operations
(Unaudited)
<table>
For the Threee Months Ended From Inception
September 30, to September 30,
2002 2001 2002
------------------------------ ----------------
(unaudited) (audited) (unaudited)
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Revenues:
Revenues - - -
Total Revenues - - -
Expenses:
Consulting Services 0 - 88,393
Depreciation - - 5,362
Professional Fees - 10,928 202,043
Operating Expenses - 955 460,779
------------ ------------- ------------
Total Expenses 0 11,883 756,577
Net Loss from Operations 0 (11,883) (756,577)
Other Income and Expenses:
Interest expense 0 - (833)
Other Commission Income - - 126,000
Loss on Sale of Auto - - (10,986)
Gain on Sale of Investments - - 2,077
Gain (Loss) on asset disposition 0 - (135,000)
------------ ------------- ------------
Total other income (expense) 0 - (18,742)
Income (loss) before income tax 0 (11,883) (775,319)
Income tax expense (benefit) 0 - 1,682
----------- ------------ -----------
Net Loss 0 (11,883) (777,001)
============ ============== =============
Basic and Diluted Earnings Per Common Share 0.00 (0.002) (0.09)
Weighted Average number of Common Shares
used in per share calculations 7,841,798 7,000,560 8,206,466
============ ============== =============
</table>
MediaBus Networks, Inc.
formerly B Y & C Management, Inc.
(A Development Stage Enterprise)
-----------------------------------------
For the Three Months Ended From Inception
September 30 to Sept 30
----------------------------------------- -------------------
2002 2001 2002
------------------- -------------------- -------------------
Cash Flows from Operating Activities:
-------------------------------------
Net Income (Loss) $ 0 $ (11,883) $ (777,001)
Changes in operating assets and
liabilities:
Depreciation - 5,362
Loss on Sale of Auto - 10,986
Gain on Sale on Investments - (2,077)
Advances from Officers 10,935 55,134
Stock issued for Services - 62,728
Increase in accounts payable and
accrued expenses - - 24,224
------------------- -------------------- -------------------
Total Adjustments $ 0 $ 10,935 156,357
------------------- -------------------- -------------------
Net Cash Used in Operating Activities $ 0 $ (948) $ (620,644)
Cash Flows from Investing Activities:
-------------------------------------
Sale of Auto - - 5,100
Purchase of Auto (21,448)
Purchase of Investment (3,633)
Investments Sold - - 5,710
------------------- -------------------- -------------------
Net Cash Used in Investing Activities $ - $ - $ (14,271)
------------------- -------------------- -------------------
Cash Flows from Financing Activities:
-------------------------------------
Proceeds from short term debt - - 75,000
Repayments from short term debt - - (50,000)
Common Stock - - 610,000
------------------- -------------------- -------------------
Net Cash Provided for Financing Activities $ - $ - $ 635,000
------------------- -------------------- -------------------
Net Increase (Decrease) in Cash $ - $ (948) $ 85
Cash Balance, Begin Period - 2,479 -
------------------- -------------------- -------------------
Cash Balance, End Period $ - $ 1,531 $ 85
=================== ==================== ===================
$ -
Supplemental Disclosures:
Cash Paid for interest $ - $ - $ -
Cash Paid for income taxes $ - $ - $ -
Stock Issued for Services - $ 5,000 $
Cash paid for Federal and
State income taxes $ - $ - $ 1,682
See accompanying notes to financial statements.
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
September 30, 2002
------------------
(Unaudited)
-----------
MediaBus Networks, Inc.
(A Development Stage Company)
Notes to Financial Statements
Note 1-Summary of Significant Accounting Policies
Organization
MediaBus Networks, inc., formerly B Y & C Management, Inc. ("the Company")
was incorporated under the laws of the State of Florida on April 28, 1998.
The Company's initial business plan was for an internet based association
of property management professionals and licensed real estate brokers that
intended to provide continuing education classes, to promote the adoption
of national standardized policies and procedures, and to develop
certification programs for its member communities. The Company has been in
the development stage since its inception. The Company briefly moved into
technologies and services that allow for the distribution and virtual
access of audio, video and interactive content to consumers and business
environments. Management is currently evaluating various strategic
opportunities to enable the Company to begin operations.
Capital Stock
The Company has a total of 100,000,000 authorized common shares with a par
value of $0.001 per share and with 7,841,798 common shares issued and
outstanding as of September 30, 2002 and June 30, 2002. The Company has a
total of 50,000,000 authorized shares of preferred stock with a par value
of $0.001 and no shares are outstanding. On June 27, 2000, the Company
filed a Certificate of Amendment to the Articles of Incorporation with the
Florida Corporation Commission to increase the authorized common shares
to 100,000,000, authorize 50,000,000 in preferred shares, and change the
par value to $0.001.
Development Stage Enterprise
The Company is a development stage enterprise, as defined in Financial
Accounting Standards Board No. 7. The Company is devoting all of its
present efforts in securing and establishing a new business, and its
planned principal operations have not commenced, and, accordingly, no
revenue has been derived during the organizational period other than the
initial non-operating revenue of $126,000.
Federal Income Tax
The Company has adopted the provisions of Financial Accounting Standards
Board Statement No. 109, Accounting for Income Taxes. The Company accounts
for income taxes pursuant to the provisions of the Financial Accounting
Standards Board Statement No. 109, "Accounting for Income Taxes", which
requires an asset and liability approach to calculating deferred income
taxes. The asset and liability approach requires the recognition of
deferred tax liabilities and assets for the expected future tax
consequences of temporary differences between the carrying amounts and the
tax basis of assets and liabilities. The Company has a net operating loss
carryovers of $777,001 that will expire in 2020 and 2021. The Company has
recorded a valuation allowance against the net operating loss carryover
resulting in no deferred tax asset being recorded on the financial
statements at the reporting dates.
MediaBus Networks, Inc.
(A Development Stage Company)
Notes to Financial Statements
Note 1-Summary of Significant Accounting Policies (continued)
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure on contingent assets and liabilities at the date of the
financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
Earnings per Common Share The Company adopted Financial Accounting
Standards (SFAS) No. 128, "Earnings Per Share," which simplifies the
computation of earnings per share requiring the restatement of all prior
periods. Basic earnings per share are computed on the basis of the weighted
average number of common shares outstanding during each year. Diluted
earnings per share are computed on the basis of the weighted average number
of common shares and dilutive securities outstanding. Dilutive securities
having an anti-dilutive effect on diluted earnings per share are excluded
from the calculation.
Comprehensive Income
Statement of Financial Accounting Standards (SFAS) No. 130, "Reporting
Comprehensive Income," establishes standards for reporting and display of
comprehensive income, its components and accumulated balances.
Comprehensive income is defined to include all changes in equity except
those resulting from investments by owners and distributions to owners.
Among other disclosures, SFAS No.130 requires that all items that are
required to be recognized under current accounting standards as components
of comprehensive income be reported in a financial statement that is
displayed with the same prominence as other financial statements. The
Company does not have any assets requiring disclosure of comprehensive
income.
Segments of an Enterprise and Related Information
Statement of Financial Accounting Standards (SFAS) No. 131, Disclosures
about Segments of an Enterprise and Related Information, supersedes SFAS
No. 14, "Financial Reporting for Segments of a Business Enterprise." SFAS
131 establishes standards for the way that public companies report
information about operating segments in annual financial statements and
requires reporting of selected information about operating segments in
interim financial statements issued to the public. It also establishes
standards for disclosures regarding products and services, geographic areas
and major customers. SFAS 131 defines operating segments as components of a
company about which separate financial information is available that is
evaluated regularly by the chief operating decision maker in deciding how
to allocate resources and in assessing performance. The Company has
evaluated this SFAS and does not believe it is applicable at this time.
MediaBus Networks, Inc.
(A Development Stage Company)
Notes to Financial Statements
Note 1-Summary of Significant Accounting Policies (concluded)
Accounting for Derivative Instruments and Hedging Activities
Statement of Financial Accounting Standards (SFAS) 133, "Accounting for
Derivative Instruments and Hedging Activities," establishes accounting and
reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts, (collectively referred
to as derivatives) and for hedging activities. It requires that an entity
recognize all derivatives as either assets or liabilities in the statement
of financial position and measure those instruments at fair value. If
certain conditions are met, a derivative may be specifically designated as
(a) a hedge of the exposure to changes in the fair value of a recognized
asset or liability or an unrecognized firm commitment, (b) a hedge of the
exposure to variable cash flows of a forecasted transaction, or (c) a hedge
of the foreign currency exposure of a net investment in a foreign
operation, an unrecognized firm commitment, an available-for sale security,
or a foreign-currency- denominated forecasted transaction. The Company
adopted SFAS 133 and SFAS 138 in the first quarter of fiscal 2001. Adoption
of SFAS 133 and SFAS 138 did not materially impact the Company's
consolidated financial position, results of operations, or cash flows.
Accounting for Certain Transactions involving Stock Compensation
The Company has elected to comply with the fair value based method of
accounting prescribed by Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation," for its common stock
compensation to employees.
Goodwill and Other Intangible Assets
In July 2001, the Financial Accounting Standards Board issued Statements of
Financial Standards ("SFAS") No. 141, "Business Combinations" and No. 142,
"Goodwill and Other Intangible Assets". SFAS No. 141 established accounting
and reporting standards for business combinations and eliminates the
pooling-of-interests method of accounting for combinations for those
combinations initiated after July 1, 2001. SFAS No, 141 also includes new
criteria to recognize intangible assets separately from goodwill. SFAS No.
142 establishes the accounting and reporting standards from goodwill and
intangible lives. Goodwill and intangibles with indefinite lives will no
longer be amortized, but, indicators of impairment. Separate intangible
assets that are not deemed to have an indefinite life will continue to be
amortized over their useful lives. The Company does not anticipate that the
adoption of SFAS No. 141 and SFAS No. 142 will have a significant effect on
its results of operations or financial position.
Reclassifications
Certain reclassifications have been made to the prior year's financial
statements in order to conform to the current presentation.
Note 2-Short-term Note
The Company received a short-term loan from Brighton Opportunity Fund, L.P.
The loan is due on demand and accrues interest at 10 percent annually.
MediaBus Networks, Inc.
(A Development Stage Company)
Notes to Financial Statements
Note 3-Business Acquisition
On January 8, 2002, the Company acquired the assets and certain liabilities
of iDVDBox, Inc. through an Asset Purchase Agreement. The Company acquired
all property, plant, and equipment, inventory, intellectual property,
customer lists and other intangible assets. The Company also became
obligated for certain liabilities and notes payable.
The Company issued the shareholders of iDVDBox, Inc. an aggregate amount of
478,260 shares in exchange and consideration for the net assets. An
additional 478,260 shares were issued in full payment of a $750,0000 note
the Company became obligated for as part of the Asset Purchase Agreement.
On May 10, 2002 the Company and iDVDBox, Inc. entered into an agreement to
"Unwind" the Asset Purchase agreement. All assets and unpaid liabilities of
iDVDBox, Inc. were transferred back and the 956,520 shares of common stock
issued in connection with the original agreement were returned and
cancelled.
The board of directors of the Company approved an Employment Agreement with
Stephen Cavayero pursuant to the IDVDBox, Inc. Asset Purchase Agreement
whereby Mr. Cavayero was issued an additional 188,305 shares of common
stock. This agreement was cancelled through the "Unwind Agreement" and the
Company canceled the shares of common stock.
Note 4-Non-Cash Transactions
During the reporting periods, the Company had no non-cash investing and
financing transactions:
Item 2. Management Discussion and Analysis and Plan of Operations
We had hoped to continue to pursue the hotel market for interactive media
distribution, but we were not been able to acquire the necessary funding
for the project. As such we laid off all employees of the Company and have
scaled operations down to a minimum. We are now searching for a merger
candidate and/or significant acquisition.
In our opinion, we do not have available funds to satisfy our working
capital requirements. We need to raise additional capital immediately to
conduct our operations. Such additional capital may be raised through
public or private financing as well as borrowings and other sources. We
cannot guaranty that additional funding will be available on favorable
terms, if at all. If adequate funds are not available, we may have to
contemplated a plan of reorganization and/or liquidation in the event that
we do not acquire financing.
We are not currently conducting any research and development activities,
other than the search for a merger candidate. We do not anticipate
conducting any other such activities in the next three months.
We do not anticipate that we will hire any employees in the next three to
six months, unless we acquire financing. We believe our future success
depends in large part upon the success in finding a qualified merger
candidate.
Plan of Operations
We have not engaged in any material operations or had any revenues from
operations since June 28, 2002. Our plan of operation for the next twelve
months will be entirely contingent on the acquisition of assets, property
or business that may benefit our Company and its stockholders. Because we
have no substantial financial resources, management believes we will be
required to issue equity securities as the sole consideration for such an
acquisition.
During the next twelve months, our operating expenses will consist of the
legal, accounting and administrative expenses associated with preparing and
distributing reports to stockholders and investigating potential business
opportunities. Accordingly, management believes that our current cash
resources will probably be adequate for our Company's anticipated needs. In
the event that additional funding is required to review or investigate any
potential merger or acquisition candidate, we may attempt to raise the
required capital through a private placement to accredited investors. Since
we have not identified any potential targets as of the date of this Form
10-QSB, it is impossible to predict whether additional capital may be
required during the next 12 months.
Except for the additional shares that may be issued to our legal counsel
and certain consultants, our management team has no plans to offer or sell
any securities for cash. However, we may decide to engage in such
activities in the future. In such an event, we will probably sell
securities for cash in a private placement transaction because Rule 419
severely restricts the ability of blank check companies to offer registered
securities for cash and use the proceeds of such an offering in their
business. Since we are not conducting a registered offering of securities
at the present time and do not intend to conduct such an offering in the
foreseeable future, our management team does not believe that Rule 419 will
be applicable to our proposed activities.
PART II
Other Information
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to Vote of Security Holders.
None.
Item 5. Other Information
None.
Item 6. REPORTS ON FORM 8-K
None.
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this Report
to be signed on its behalf by the undersigned hereunto duly authorized.
MediaBus Networks, Inc.
Dated: December 26, 2002 /s/ Kenneth O. Lipscomb
KENNETH O. LIPSCOMB, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
/s/KENNETH O. LIPSCOMB
Kenneth O. Lipscomb Chairman & President December 26, 2002