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, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from July 1, 2001 to September 30, 2001
Commission File No. 000-15260
BRL Holdings, Inc.
(Exact name of small business issuer as specified in its charter)
Delaware 88-0218411
(State or other jurisdiction of (Internal Revenue Service
incorporation or organization) Employer Identification No.)
340 Granite St. Suite 200, Manchester, NH 03102
(Address of principal Executive offices including Zip Code)
(603) 641-8443
Issuer's telephone number, including area code
Former name, former address and formal 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) and (2) has been subject to such
filing requirements for the past 90 days. Yes ___ X ____ No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the last practicable date, 4,610,939 shares of
common stock, par value $.01 per share as of November 12, 2001.
-----------------------------------------------------------------
Transitional Small Business Disclosure Format (Check One) Yes No X
---- ----
BRL Holdings, Inc.
INDEX
PART I. FINANCIAL INFORMATION Page
Number
Item 1. Financial Statements .........................................................................3
Balance sheets as of September 30, 2001 (unaudited) and
June 30, 2001.................................................................................3
Statements of Operations for the Three Months Ended
September 30, 2001 and 1992 (unaudited) ......................................................4
Statements of Cash Flows for the three Months Ended
September 30, 2001 and 1992 (unaudited) ......................................................5
Notes to Unaudited Financial Statements ......................................................7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation..........8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.............................................................................9
Item 2. Changes in Securities ........................................................................9
Item 3. Defaults Upon Senior Securities ..............................................................9
Item 4. Submission of Matters to a Vote of Security Holders...........................................9
Item 5. Other Information.............................................................................9
Item 6. Exhibits and Reports on Form 8-K. ............................................................9
PART I. FINANCIAL INFORMATION
Item 1. Financial Statement
BRL HOLDINGS, INC.
BALANCE SHEETS
September 30, 2001 and June 30, 2001
September June 30,
30, 2001 2001
(Unaudited)
ASSETS
Current Assets:
Cash $ 2,291 $ 119
Notes receivable 13,624 13,624
Other receivables 995 -
Prepaid expenses and other current assets 450 980
------ ------
Total current assets 17,360 14,723
------ ------
Equipment and leasehold improvements, net - -
------ ------
Other assets:
Investments 6,382 6,382
Other non current assets - -
------ ------
Total assets $ 23,742 $ 21,105
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCIES)
Current liabilities:
Accounts payable $ 21,264 $ 4,675
Accrued expenses 8,850 13,014
------ ------
Total current liabilities 30,114 17,689
- -
- -
Other liabilities - related party 10,124 10,124
------ ------
Total liabilities 40,238 27,813
------ ------
Stockholders' equity (Deficiency):
Common stock of $.01 par value, 50,000,000 shares authorized, 1,433,939
issued and outstanding at September 30, 2001 and
June 30, 2001 14,339 14,339
Additional paid-in capital 7,137,282 7,137,282
Accumulated deficit (7,168,117) (7,158,329)
------ ------
Total Stockholder's Equity (Deficiencies) (16,496) (6,708)
------ ------
Total liabilities and stockholders' equity (deficiencies) $ 23,742 $ 21,105
========== ========
The accompanying notes are an integral part of
the financial statements.
BRL HOLDINGS, INC.
STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 2001 and 2000
(Unaudited)
Three Months Ended
September 30,
(Unaudited)
2000
2001 Consolidated
---- -------------
Revenues $ - $ 8,255
Cost of goods sold - 2,345
------ ------
Gross profit - 5,910
Costs and expenses:
General and administrative (9,788) (6,095)
-------- -------
Total costs and expenses (9,788) (6,095)
------- - -------
Loss from operations (9,788) (185)
--------- ---------
Other Income (Costs):
Income from investee - -
Offering costs - (7,846)
Other income (expense) - (898)
---------- --------
Total other expenses ( -) (8,744)
--------- -------
Net (loss)/ $ (9,788) $ (8,929)
========= ========
Weighted average shares 1,433,939 12,124,238
Basic and fully diluted loss per share $ (0.00) $ (0.00)
The accompanying notes are an integral part of
the financial statements.
BRL HOLDINGS, INC.
STATEMENT OF CASH FLOWS
For the three Months Ended September, 2001 and 2000
(Unaudited)
-------------
Three Months Ended
September 30,
2001 2000
---- Consolidated
Cash flows from operating activities: ------------
Net (loss)/Gain $ (9,788) $(8,929)
Adjustments to reconcile net loss to net cash used in development
activities:
Depreciation and amortization - 157
(Increase) Decrease in current assets:
Accounts Receivable - (6,125)
Inventories - 794
Other receivables (995) 898
Prepaid expenses and other current assets 530 -
Increase (Decrease) in current liabilities:
Accounts payable 16,589 2,423
Accrued expenses (4,164) 1,350
Other current liabilities - -
Other liabilities - 1,513
-------------- -----
Net cash used in operating activities $ 2,172 $ (7,919)
--------- ---------
The accompanying notes are an integral part of the financial statements.
BRL HOLDINGS, INC.
STATEMENT OF CASH FLOWS
For the Three Months Ended September 30, 2001 and 2000
(Unaudited)
Three Months Ended September 30,
2001 2000
(Consolidated)
Cash flows from investing activities:
Net cash used in investing activities $ ( -) $ -
----------------- ------------------
Cash flows from financing activities:
Issuance of common stock, net - (1)
Payment of deferred offering costs - 7,846
Net cash provided by investing activities $ - $ 7,845
----------------- ------------------
Net increase (decrease) in cash 2,172 (74)
Cash at beginning of period 119 502
---- ---
Cash at end of period $ 2,291 $ 428
================== ==================
The accompanying notes are an integral part of
the financial statements.
BRL HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001
ITEM 1. Basis of presentation
The accompanying 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 and Rule 310 of Regulation
S-B. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete consolidated
financial statements and should be read in conjunction with the Company's
audited financial statements at and for the fiscal year ended June 30, 2001. In
the opinion of management, all adjustments (consisting only of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three months ended September 30, 2001 are not
necessarily indicative of the results that may be expected for the year ended
June 30, 2002.
The financial statements of the Company for the current period and inception to
date are the financial data of the Company. The prior year financial statements
were consolidated with the Company's Subsidiary, Biorelease Technologies, Inc.
at June 30, 2000 and for the quarter period ended September 30, 2000. On
December 31, 2000 the majority of the Company's interest in its then held
subsidiary, Biorelease Technologies, Inc. was sold leaving the Company without
operations. When the Company controlled the Subsidiaries, the results of
operations were primarily the business of the Subsidiary.
The results of operations for the three months ended September 30, 2001 were the
losses of the Company ($9,788) as compared to September 30, 2000 wherein the
loss of the Company ($14,003) was offset by net income of the subsidary of
$5,074. Consisting of revenues of $8,255 cost of goods sold of $2,345 and
administration expenses of $836.
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
The following discussion includes the business of the Company. Since
inception (1986) the Company has been engaged in the acquisition of businesses,
raising capital, operating the businesses of Subsidiaries for the Company and
searching for additional acquisition candidates. On December 31, 2000 the
majority of the Company's interest in its then held subsidiary, Biorelease
Technologies, Inc. was sold leaving the company without operations. Prior to
that, the Company had acquired and divested itself of other businesses through
mergers, spin off's, and the sale of the Company's investments. When the Company
controlled the Subsidiaries, the results of operations were the business of the
Subsidiaries. Currently the Company has no controlling interest in any company
and has no operations. (See Item 5)
Three Months Ended September 30, 2001 and 2000
For the three months ended September 30, 2001 the Company had no
revenues, no costs of sales, administrative expenses of $9,788 and no other
expenses yielding a net loss of $9,788 for the three months period ended
September 30, 2001 as compared to the three months ended September 30, 2000 in
which the Company including the Subsidiary had revenues of $8,255, cost of goods
sold of $2,345, administrative expenses of $6,095, Offering costs of $7,846,
other expenses of $898 and no income taxes resulting in a net loss of $8,929 of
which the subsidary had not income of $5,074 and the company had net losses of
$14,003.
Liquidity and Capital Resources
From inception the primary source of capital has been the funds
raised by the company from private offerings of its Common Stock and the sale of
the Company's interest in subsidiaries.
Dividend Policy
The Company has not declared or paid any cash dividends on its common
stock since its inception and does not anticipate the declaration or payment of
cash dividends in the foreseeable future. The Company intends to retain
earnings, if any, to finance the development and expansion of its business.
Future dividend policy will be subject to the discretion of the Board of
Directors and will be contingent upon future earnings, if any, the Company's
financial condition, capital requirements, general business conditions and other
factors. Therefore, there can be no assurance that dividends of any kind will
ever be paid.
Effect of Inflation
Management believes that inflation has not had a material effect on
its operations for the periods presented.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of matters to a Vote of Securities Holders
None
Item 5. Other Information
Effective November 12th, 2001, BRL Holdings, Inc. ("the Company") acquired 100%
of the stock of AssureTec Systems, Inc. ("AssureTec") in a stock for stock
transaction ("the Acquisition"). To complete the Acquisition, the Company issued
3,177,000 restricted shares of common stock. Further, 2,325,000 options for a
like number of shares of common stock were issued to employees and consultants
of AssureTec to replace options issued by AssureTec. 1,050,000 of these options
are subject to continuing employment of the management team and the remaining
1,275,000 are subject to the management team meeting specific technical and
financial milestones. Under terms of the Acquisition, all persons receiving
shares and options issued under the Acquisition waived any rights to spin-off
shares, if any such shares are issued by the Company, resulting from the
Company's continuing sponsorship of three independent business units. A form 8k
relating to the acquisition will be fixed by the Company within 5 days of the
filing of this 10QSB.
Item 6. Exhibits and Reports on form 8-K.
None
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
BRL HOLDINGS, INC.
November 19, 2001 By: /s/ R. Bruce Reeves
-------------------
R. Bruce Reeves, CEO and
Principal Financial Officer