-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J/mb+v6sAcMnj5J+Gcglbq9ZQBMj2ljep0J2Kn5ABszG1/LP2FaNae/IOzzijJsB ROPxo0VLyPzJeyWRD4tswg== 0001014897-06-000067.txt : 20060814 0001014897-06-000067.hdr.sgml : 20060814 20060814162301 ACCESSION NUMBER: 0001014897-06-000067 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060630 FILED AS OF DATE: 20060814 DATE AS OF CHANGE: 20060814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DALE JARRETT RACING ADVENTURE INC CENTRAL INDEX KEY: 0001094032 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 593564984 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-27251 FILM NUMBER: 061030799 BUSINESS ADDRESS: STREET 1: 120A N. MAIN AVENUE CITY: NEWTON STATE: NC ZIP: 28658 BUSINESS PHONE: 8884672231 MAIL ADDRESS: STREET 1: 120A N. MAIN AVENUE CITY: NEWTON STATE: NC ZIP: 28658 FORMER COMPANY: FORMER CONFORMED NAME: JARRETT FAVRE DRIVING ADVENTURE INC DATE OF NAME CHANGE: 19990827 10QSB 1 jarrett10q2q06final.txt FORM 10QSB FOR JUNE 30, 2006 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB [x] Quarterly Report Pursuant to Section 13 or 15(d) Securities Exchange Act of 1934 for Quarterly Period Ended June 30, 2006 - -OR- [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities And Exchange Act of 1934 for the transaction period from _________ to________ Commission File Number 333-39942 Dale Jarrett Racing Adventure, Inc. - -------------------------------------------- (Exact name of registrant as specified in its charter) FLORIDA 59-3564984 - -------------------------------------------- (State or other jurisdiction (I.R.S. Employer Identification Number) of incorporation or organization 3604 Denver Drive, Denver, NC 28037 - -------------------------------------------- (Address of principal executive offices, Zip Code) (888) 467-2231 - ---------------------- -------------------- (Registrant's telephone number, including area code) Check whether the issuer (1) 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 [ ] The number of outstanding shares of the registrant's common stock, June 30, 2006: Common Stock - 19,362,376 2 PART I -- FINANCIAL INFORMATION Dale Jarrett Racing Adventure, Inc. Item 1. Financial Statements Balance Sheet, June 30, 2006(unaudited) Statements of Operations for the Three months and Six months ended June 30, 2006 and 2005 (unaudited) Statements of Cash Flows for the Six months ended June 30, 2006 and 2005 (unaudited) Notes to financial statements 3 Dale Jarrett Racing Adventure, Inc. Balance Sheet June 30, 2006 (Unaudited) ASSETS ------ Current assets: Cash $ 224,313 Inventory 8,606 Prepaid expenses and other current assets 126,936 ---------- Total current assets 359,855 ---------- Property and equipment, at cost, net of accumulated depreciation of $680,412 215,524 ---------- $ 575,379 ========== LIABILITIES AND STOCKHOLDERS' (DEFICIT) --------------------------------------- Current liabilities: Note payable $ 60,061 Current portion of long-term debt 18,384 Accounts payable 52,239 Accrued expenses 106,167 Accrued salaries - officers 137,285 Deferred revenue 902,868 Shareholder advances 286,544 ---------- Total current liabilities 1,563,548 ---------- Long-term debt 964 ---------- Stockholders' (deficit): Common stock, $.01 par value, 100,000,000 shares authorized, 19,362,376 shares issue and outstanding 191,624 Additional paid-in capital 3,986,378 Deferred services (70,500) Accumulated (deficit) (5,096,635) ---------- (989,133) ---------- $ 575,379 ========== See accompanying notes to financial statements. 4 Dale Jarrett Racing Adventure, Inc. Statements of Operations For The Three Months and Six Months Ended June 30, 2006 and 2005 (Unaudited)
Three Months Six Months 2006 2005 2006 2005 ---------- ---------- ---------- ---------- Sales $ 565,760 $ 562,058 $ 716,922 $ 782,733 Cost of sales and services 230,383 303,809 341,719 448,103 ---------- ---------- ---------- ---------- Gross profit 335,377 258,249 375,203 334,630 ---------- ---------- ---------- ---------- Expenses General and administrative - non cash stock compensation 29,250 - 29,250 12,000 General and administrative 267,055 230,771 540,589 503,150 ---------- ---------- ---------- ---------- 296,305 230,771 569,839 515,150 ---------- ---------- ---------- ---------- Income (loss) from operations 39,072 27,478 (194,636) (180,520) Other income and (expense): Interest income 726 - 1,448 - Other income - - 450 404 Interest expense (5,821) (4,997) (13,469) (11,170) ---------- ---------- ---------- ---------- (5,095) (4,997) (11,571) (10,766) ---------- ---------- ---------- ---------- (Loss) before taxes 33,977 22,481 (206,207) (191,286) Income taxes - - - - ---------- ---------- ---------- ---------- Net (loss) $ 33,977 $ 22,481 $ (206,207) $ (191,286) ========== ========== ========== ========== Per share information: Basic and diluted (loss) per share $ 0.00 $ 0.00 $ (0.01) $ (0.01) ========== ========== ========== ========== Weighted average shares outstanding 19,108,209 18,196,876 19,054,043 18,196,876 ========== ========== ========== ==========
See accompanying notes to financial statements. 5 Dale Jarrett Racing Adventure, Inc. Statements of Cash Flows For the Six Months Ended June 30, 2006 and 2005 (Unaudited) 2006 2005 ---------- ---------- Net cash provided by (used in) operating activities $ 51,903 $ (104,189) ---------- ---------- Cash flows from investing activities: Acquisition of plant and equipment (70,622) (8,946) ---------- ---------- Net cash (used in) financing activities (70,622) (8,946) ---------- ---------- Cash flows from financing activities: Repayment of officer advance - (35,000) Repayment of notes payable (57,939) (7,525) Repayment of long-term debt (12,605) (17,258) ---------- ---------- Net cash (used in) financing activities (70,544) (59,783) ---------- ---------- (Decrease) in cash (89,263) (172,918) ---------- ---------- Cash and cash equivalents, beginning of period 313,576 263,200 ---------- ---------- Cash and cash equivalents, end of period $ 224,313 $ 90,282 ========== ========== See accompanying notes to financial statements. 6 DALE JARRETT RACING ADVENTURE, INC. NOTES TO FINANCIAL STATEMENTS JUNE 30, 2006 (UNAUDITED) (1) Basis Of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and Item 310(b) of Regulation S-B. They do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. For further information, refer to the financial statements of the Company as of and for the year ended December 31, 2005, including notes thereto included in the Company?s Form 10-KSB. (2) Earnings Per Share The Company calculates net income (loss) per share as required by Statement of Financial Accounting Standards (SFAS) 128, "Earnings per Share." Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During periods when anti-dilutive commons stock equivalents are not considered in the computation. (3) Inventory Inventory is valued at the lower of cost or market on a first-in first- out basis and consists primarily of finished goods and includes primarily promotional items that bear the Company?s logo. (4) Stockholders? Equity During the period ended June 30, 2006, the Company issued 162,500 shares of common stock for services. The shares were valued at their fair market value of $$29,250. In addition, the Company issued 200,000 shares of common stock subscribed for at December 31, 2005. 7 (5) Basis of Reporting The Company?s financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has experienced a significant loss from operations as a result of its investment necessary to achieve its operating plan, which is long-range in nature. From inception to March 31, 2006, the Company incurred net losses of $5,096,635 and for the six months ended June 30, 2006, the Company incurred a net loss of $206,207. In addition, the Company has working capital and stockholder deficits of $1,203,693 and $989,133 at June 30, 2006. The Company?s ability to continue as a going concern is contingent upon its ability to attain profitable operations and secure financing. In addition, the Company?s ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrance into established markets and the competitive environment in which the Company operates. The Company is pursuing equity financing for its operations. Failure to secure such financing or to raise additional capital or attain materially profitable operations may result in the Company depleting its available funds and not being able pay its obligations. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern. 8 ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Trends and Uncertainties. Demand for the Corporation's products are dependent on, among other things, general economic conditions that are cyclical in nature. Inasmuch as a major portion of the Corporation's activities are the receipt of revenues from its driving school services and products, the Corporation's business operations may be adversely affected by the Corporation?s competitors and prolonged recessionary periods. There are no known trends, events or uncertainties that have or are reasonably likely to have a material impact on the corporation?s short term or long term liquidity. Sources of liquidity both internal and external will come from the sale of the corporation?s products as well as the private sale of the Corporation?s stock. There are no material commitments for capital expenditure at this time. There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. There are no significant elements of income or loss that do not arise from the Corporation?s continuing operations. There are no known causes for any material changes from period to period in one or more line items of the corporation?s financial statements. The Corporation currently has classes planned through December 2006. Capital and Source of Liquidity. The Corporation currently has no material commitments for capital expenditures. The Corporation has no plans for future capital expenditures such as additional race cars at this time. The Corporation believes that there will be sufficient capital from revenues to conduct operations for the next twelve(12) months. Presently, the Corporation?s revenue comprises one hundred(100) percent of the total cash necessary to conduct operations. Future revenues from classes and events will determine the amount of offering proceeds, if any, necessary to continue operations. The board of directors has no immediate offering plans in place. The board of directors shall determine the amount and type of offering as the Corporation's financial situation dictates. The Corporation had cash and cash equivalents at June 30, 2006 of $224,313 compared to $313,376 at December 31, 2005. The decrease in cash and cash equivalents at June 30, 2006 compared to December 31, 2005 was due principally to the net loss for the period and the repayment of notes and other debt and the acquisition of equipment. For the six months ended June 30, 2006, the Corporation acquired plant and equipment of $70,622 resulting in net cash used in investing activities of $70,662. 9 For the six months ended June 30, 2005, the Corporation acquired plant and equipment of $8,946 resulting in net cash used in investing activities of $8,946. The Corporation was able to repay some its outstanding debt. For the six months ended June 30, 2006, the Corporation did not make any officer advance repayment compared to a $35,000 repayment for the six months ended June 30, 2005. Additionally, the Corporation repaid notes payable of $57,939 and repaid long-term debt of $12,605 compared to $7,525 and $17,258, respectively for the six months ended June 30, 2005. As a result, the Corporation had net cash used in financing activities of $70,544 for the six months ended June 30, 2006 compared to $59,783 for the six months ended June 30, 2005. On a long term basis, liquidity is dependent on continuation of operation and receipt of revenues. Results of Operations. For the three months ended June 30, 2006, the Corporation had sales of $565,760 with cost of sales of $230,383 for a gross profit of $335,377. Comparatively, for the three months ended June 30, 2005, the Corporation had sales of $562,058 with cost of sales of $303,809 for a gross profit of $258,249. For the three months ended June 30, 2006, the Corporation had general and administrative expenses of $267,055 and non cash stock compensation of $29,250 compared to $230,771 and $0, respectively for the same period in 2005. The amount of general and administrative expenses increased for the three months ended June 30, 2006 compared to the same period in 2005 due mainly to an increase in parts and supplies for the racecars, non-cash stock compensation, an increase in professional fees. For the six months ended June 30, 2006, the Corporation had sales of $716,922 with cost of sales of $341,719 for a gross profit of $375,203. Comparatively, for the six months ended June 30, 2005, the Corporation had sales of $782,733 with cost of sales of $448,103 for a gross profit of $334,630. For the six months ended June 30, 2006, the Corporation had general and administrative expenses of $540,589 and non cash stock compensation of $29,250 compared to $503,150 and $12,000, respectively for the same period in 2005. The amount of general and administrative expenses increased for the six months ended June 30, 2006 compared to the same period in 2005 due mainly to an increase in parts and supplies for the racecars, non-cash stock compensation, an increase in professional fees. Plan of Operation. The Corporation may experience problems; delays, expenses and difficulties sometimes encountered by an enterprise in the Corporation?s stage, many of which are beyond the Corporation?s control. These include, but are not limited to, unanticipated problems relating to additional costs and expenses that may exceed current estimates and competition. 10 The Corporation is not delinquent in any of its obligations even though the Corporation has generated limited operating revenues. The Corporation intends to market its products and services utilizing current revenues and cash made available from the private sale of its securities, if any. The Corporation's management is of the opinion that its revenues and the proceeds of the sales of its securities, if any, will be sufficient to pay its expenses for the next twelve months. Our auditors have expressed reservations concerning our ability to continue as a going concern. The Corporation has incurred significant losses from operations and has working capital and stockholder deficiencies. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is contingent upon our ability to secure additional financing, increase ownership equity and attain profitable operations. In addition, the Corporation's ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrance into established markets and the competitive environment in which the Corporation operates. The Corporation is pursuing financing for its operations and seeking additional private investments. In addition, the Corporation is seeking to expand its revenue base. Failure to secure such financing or to raise additional equity capital and to expand its revenue base may result in the Corporation depleting its available funds and not being able pay its obligations. Item 3. Controls and Procedures Evaluation of Disclosure Controls and Procedures Our management, under the supervision and with the participation of our chief executive officer, conducted an evaluation of our "disclosure controls and procedures" (as defined in Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-14(c)). Based on his evaluation, our chief executive officer and chief financial officer have concluded that as of the Evaluation Date, our disclosure controls and procedures are effective to ensure that all material information required to be filed in this quarterly report on Form 10QSB has been made known to him in a timely fashion. Changes in Internal Controls There have been no significant changes (including corrective actions with regard to significant deficiencies or material weaknesses) in our internal controls or in other factors that could significantly affect these controls subsequent to the Evaluation Date set forth above. 11 PART II - OTHER INFORMATION Item 1. Legal Proceedings. Not applicable. Item 2. Changes in Securities and Use of Proceeds. The Corporation issued 162,500 shares of common stock for services. The shares were valued at their fair market value of $29,250. In addition, the Corporation issued 200,000 shares of common stock subscribed for at December 31, 2005. Item 3. Defaults Upon Senior Securities. not applicable. Item 4. Submission of Matters to a Vote of Security Holders. not applicable. Item 5. Other Information. Not applicable. Item 6. Exhibits and Reports on Form 8-K. (a) Reports on Form 8-K. none (b) Exhibits. none 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. Dated: August 14, 2006 Dale Jarrett Driving Adventure, Inc. By /s/ Timothy B. Shannon ------------------------ Timothy B. Shannon President and Director EX-31 2 jarrett10q2q06ex31.txt 302 CERTIFICATION 302 CERTIFICATION I, Timothy B. Shannon, certify that: 1. I have reviewed the quarterly report on Form 10-QSB of Dale Jarrett Racing Adventure, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 12a-14) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report my conclusions about the effectiveness of the disclosure controls and procedures based on my evaluation as of the Evaluation Date; 5. I have disclosed, based on my most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting. Date: August 14, 2006 /s/Timothy B. Shannon ---------------------------- Timothy B. Shannon Chief Executive Officer Chief Financial Officer EX-32 3 jarrett10q2q06ex32.txt 906 CERTIFICATION CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 The undersigned officer of Dale Jarrett Racing Adventure, Inc. (the "Company"), hereby certifies, to such officer's knowledge, that the Company's Quarterly Report on Form 10-QSB for the six months ended June 30, 2006 (the "Report") fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ Timothy B. Shannon ---------------------- Timothy B. Shannon Chief Executive Officer Chief Financial Officer August 14, 2006 -----END PRIVACY-ENHANCED MESSAGE-----