CONFORMED SUBMISSION TYPE: 10QSB
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 20030930
FILED AS OF DATE: 20031114
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: WORLD TRANSPORT AUTHORITY, INC.
CENTRAL INDEX KEY: 0001028130
STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLES & PASSENGER CAR
BODIES [3711]
IRS NUMBER: 931202663
FISCAL YEAR END: 630
FILING VALUES:
FORM TYPE: 10QSB
SEC ACT:
SEC FILE NUMBER: 000-23693
FILM NUMBER: 99627765
BUSINESS ADDRESS:
STREET 1: 140 West Park Avenue
CITY: El Cajon
STATE: CA
ZIP: 92020
BUSINESS PHONE: 6195932440
MAIL ADDRESS:
STREET 1: 140 West Park Avenue
CITY: El Cajon
STATE: CA
ZIP: 92020
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report under Section 13 or 15 (d) of
Securities Exchange Act of 1934
For Quarter ended September 30, 2003
Commission File Number 0-23693
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WORLD TRANSPORT AUTHORITY, INC.
(Exact name of registrant as specified in its charter)
Alberta, BC 93-1202663
(State of Incorporation) (I.R.S. Employer Identification No.)
140 West Park Avenue, Suite 219
El Cajon, California 92020
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(Address of Principal Executive Offices)
(619) 593-2440 Fax: (619) 593-2444
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(Registrant's telephone and fax number, including area code)
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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 at the latest practicable date.
As of September 30, 2003, the registrant had 84,728,749 shares of common
stock, no stated par value, issued and outstanding.
1
INDEX PAGE NO.
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS 2
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 5
ITEM 2. MANAGEMENT?S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 7
ITEM 3. CONTROLS AND PROCEDURES 8
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 8
ITEM 2-5. NOT APPLICABLE 8
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 8
CERTIFICATIONS 9
PART I FINANCIAL INFORMATION
ITEM 1. Financial Statements
WORLD TRANSPORT AUTHORITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 2003
(UNAUDITED)
ASSETS
Current Assets:
Cash $ 27,200
Prepaid expenses and other current assets 200
----------
Total Current Assets 27,400
----------
Other Assets 544
----------
TOTAL ASSETS $ 27,944
==========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities:
Accounts payable $ 360,649
Accrued expenses 49,574
Due to officers/directors 14,198
Due to stockholder 84,122
Obligations under settlement agreements 421,054
----------
Total Current Liabilities 929,597
Deferred license fees 237,000
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TOTAL LIABILITIES 1,166,597
----------
Commitments and Contingencies -
Stockholders? Deficiency:
Common stock - unlimited shares authorized, no par
value; 84,728,749 shares issued and outstanding 13,025,504
Accumulated deficit (14,164,157)
----------
Total stockholders? deficiency (1,138,653)
----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 27,944
==========
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
2
WORLD TRANSPORT AUTHORITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended
September 30,
-------------------------------
2003 2002
-------------------------------
Revenue:
Freight revenue $ 0 $ 0
Royalties 0 0
---------- -----------
0 0
---------- -----------
Cost of revenue 0 0
---------- -----------
Gross profit 0 0
---------- -----------
Operating expenses:
Selling and general 39,973 157,842
Depreciation and amortization 0 49,017
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Total 39,973 206,859
----------- -----------
Loss from operations (39,973) (206,859)
Other income 2 5,253
Interest expense 5,295 12,514
----------- -----------
Net loss $ (45,266) $ (214,120)
=========== ===========
Basic net loss per share $ (0.00) $ (0.00)
=========== ===========
Basic weighted average shares outstanding 82,000,000 73,000,000
=========== ===========
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
3
WORLD TRANSPORT AUTHORITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three months ended
September 30,
-------------------------
2003 2002
----------- -----------
Operating activities:
Net loss $ (45,266) $ (214,120)
Adjustments to reconcile net loss to net
cash used in operating activities:
Provision for doubtful accounts - 5,000
Depreciation and amortization - 49,017
Common stock issued for services, bonuses,
compensation and charitable contribution - 27,500
Changes in operating assets and liabilities:
Accounts receivable (5,250)
Prepaid expenses and other current assets - (533)
Other assets - (230)
Accounts payable 25,966 8,247
Accrued expenses (1,656) 2,398
Deferred license fees - -
Obligations under settlement agreements 3,750 82,760
---------- ----------
Net cash used in operating activities (17,206) (45,211)
---------- ----------
Financing activities:
Advances from related party (310) 2,000
Due to officers/directors 43,853 -
Proceeds from sale of common stock - 42,780
---------- ----------
Net cash provided by financing activities 43,543 44,780
---------- ----------
Net increase (decrease) in cash 26,337 (431)
Cash, beginning of period 863 1,122
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Cash, end of period $ 27,200 $ 691
========== ==========
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
4
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Interim Reporting
In the opinion of management, the accompanying condensed consolidated
financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position of
World Transport Authority, Inc. and its subsidiaries (the ?Company?) as of
September 30, 2003 and their results of operations and cash flows for the
three months ended September 30, 2003 and 2002.
Pursuant to the rules and regulations of the Securities and Exchange
Commission (the ?SEC?), certain information and disclosures normally included
in financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed or
omitted from these financial statements, unless significant changes have
taken place since the end of the most recent fiscal year. Accordingly, these
unaudited condensed consolidated financial statements should be read in
conjunction with the audited financial statements of the Company as of
June 30, 2003, and for the years ended June 30, 2003 and 2002 included in the
Company?s Annual Report on Form 10-KSB for the year ended June 30, 2003, that
was previously filed with the SEC.
Results for the three months ended September 30, 2003 are not necessarily
indicative of the results to be obtained for the full year.
2. Basis of Presentation
As shown in the accompanying financial statements, the Company had a net
loss of $45,266 and net cash used in operating activities of $17,206 for the
three months ended September 30, 2003. In addition, the Company has a working
capital deficit of $902,197 as of September 30, 2003 and is heavily reliant on
proceeds from loans and sale of stock from/to officers and directors for its
working capital needs. Management cannot determine whether the Company will
become profitable, and whether operating activities will begin to generate
cash. If operating activities continue to use substantial amounts of cash,
the Company will need additional financing. These matters raise substantial
doubt about the ability of the Company to continue as a going concern.
Historically, the Company has funded its operations through sales of
common stock to private investors and borrowings from a stockholder and
directors. Management plans to obtain the funds needed to enable the Company
to continue as a going concern through the private sales of common stock and
sales of master licenses and manufacturing and distribution licenses.
However, management cannot provide any assurance that the Company will be
successful in consummating any private sales of common stock or generating
sufficient license fee payments from master and manufacturing and distribution
licenses.
The accompanying condensed consolidated financial statements have been
prepared assuming the Company will continue as a going concern, which
contemplates continuity of operations, realization of assets and satisfaction
of liabilities in the ordinary course of business. If the Company is unable
to raise additional capital or generate sales of licenses, it may be required
to liquidate assets or take actions, which may not be favorable to the
5
Company, in order to continue operations. The accompanying condensed
consolidated financial statements do not include any adjustments related to
the recoverability and classification of assets or the amounts and
classification of liabilities that might be necessary should the Company be
unable to continue its operations as a going concern.
3. MASTER LICENSE AND MANUFACTURING AND DISTRIBUTION LICENSES
There were no new Master License Agreements (?MLA?) or Manufacturing and
Distribution Agreements (?MDA?) signed during the three months ended September
30, 2003.
No other activity has taken place for any of the other MLH?s during the
quarter ended September 30, 2003.
4. Related party transactions:
The Company has an outstanding stockholder?s loan of $84,122 on September
30, 2003, which is unsecured, non-interest bearing and due on demand. The
Company approved the issuance of 2,762,916 shares of common stock to retire
$33,155 of the outstanding debt to directors at $.012 per share. The Company
has outstanding loans with the directors of the Company of $14,198 as of
September 30, 2003.
Subsequent to period ended September 30, 2003 the directors of the
Company loaned an additional $10,399. The Company approved the issuance of
519,965 common shares of stock at a price of $.02 per share to retire this
debt. The Company will recognize an interest expense of $5,200 for the
beneficial conversion feature related to these loans during the second
quarter.
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Financial condition and liquidity:
As shown in the financial statements, the Company incurred a net loss of
$45,266 and used net cash for operating activities of $17,206 for the three
months ended September 30, 2003. In addition, the Company has a working
capital deficit of $902,197 as of September 30, 2003 and is heavily reliant on
proceeds from loans and sale of stock from/to officers and directors for its
working capital needs. Management cannot determine when the Company will
become profitable, if ever, and when operating activities will begin to
generate cash, if ever. If operating activities continue to use substantial
amounts of cash, the Company will need additional financing. These matters
raise substantial doubt about the ability of the Company to continue as a
going concern.
Historically, the Company has funded its operations through sales of
common stock to private investors and borrowings from a stockholder.
Management plans to obtain the funds needed to enable the Company to continue
as a going concern through the private sales of common stock and sales of
6
master licenses and manufacturing and distribution licenses. However,
management cannot provide any assurance that the Company will be successful in
consummating any private sales of common stock or generating sufficient
license fee payments for master and manufacturing and distribution licenses.
The consolidated financial statements have been prepared assuming the
Company will continue as a going concern, which contemplates continuity of
operations, realization of assets and satisfaction of liabilities in the
ordinary course of business. If the Company is unable to raise additional
capital or generate sales of licenses it may be required to liquidate assets
or take actions, which may not be favorable to the Company, in order to
continue operations. The accompanying consolidated financial statements do
not include any adjustments related to the recoverability and classification
of assets or the amounts and classification of liabilities that might be
necessary should the Company be unable to continue its operations as a going
concern.
As of September 30, 2003, the Company had $27,200 cash on hand and in the
bank, all of which was subsequently used for costs related to its annual
audit.
The primary sources of cash and financing for the Company for the three
months then ended were $43,853 loaned from directors of the Company. The
primary uses of cash during the same period were $17,206 for the Company's
operations. The Company currently maintains a positive cash balance through
sales of common stock and loans from directors of the Company.
Results of operations:
The Company did not generate revenue during the three months ended
September 30, 2003, or during the three months ended September 30, 2002.
There have been no new license agreements signed during the period, and
therefore no license sales have been recorded.
The Company sustained a net loss of $45,266 for the three months ended
September 30, 2003 compared to net loss of $214,120 for the three months ended
September 30, 2002. A decrease of 79% in net loss was primarily due to the
effort on the part of management to continue to downsize and streamline the
operations of the Company until cash flow increases. Expenses that have been
decreased as compared to the same three month period last year include:
payroll, depreciation, consulting, interest, travel and settlement expenses.
ITEM 3. CONTROLS AND PROCEDURES
Within 90 days prior to the date of this quarterly report for the period
ended September 30, 2003, the Company carried out an evaluation of the design
and effectiveness of the Company?s disclosure controls and procedures,
pursuant to Rule 13 a-14 of the Securities Exchange Act of 1934. This
evaluation took place under the supervision and with the participation of the
company?s management, including the Chief Executive Officer and President of
the Company. Based on these evaluations the principal executive officers
concluded that the company?s disclosure controls and procedures are effective
in timely alerting them to material information relating to the company,
including the consolidated subsidiaries, required to be included in the
company?s periodic SEC filings. There were no significant changes in internal
7
controls or other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation.
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings.
During the period ended September 30, 2003, there were no changes to the
legal settlement issues as stated in the annual report for period ended June
30, 2003.
ITEM 2-5. Not applicable
ITEM 6. Exhibits and Reports on Form 8-K.
a. No reports on Form 8-K were filed during the fiscal quarter ended
September 30, 2003.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
WORLD TRANSPORT AUTHORITY, INC.
Date: November 19, 2003 /s/ LYLE WARDROP
----------------------------------------
Lyle Wardrop
President, Director
8
CERTIFICATION
I, Lyle Wardrop, the Chief Accounting Officer of World Transport
Authority, Inc. certify that:
1. I have reviewed this quarter-end report on Form 10-QSB of World
Transport Authority, Inc.
2. Based on my knowledge, this 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 report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the small business issuer as of, and for, the periods presented in
this report;
4. The small business issuer?s other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the small business issuer and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during
the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under
my supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles.
(c) Evaluated the effectiveness of the small business issuer?s disclosure
controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as
of the end of the period covered by this report based on such
evaluation; and
(d) Disclosed in this report any change in the small business issuer?s
internal control over financial reporting that occurred during the
small business issuer?s most recent fiscal quarter that has
materially affected, or is reasonably likely to materially affect,
the small business issuer?s internal control over financial
reporting; and
5. The small business issuer?s other certifying officer and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer?s auditors and the
9
audit committee of the small business issuer?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 small business issuer?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 small business issuer?s
internal control over financial reporting.
Dated: November 19, 2003 /s/Lyle Wardrop
-----------------------
Lyle Wardrop
President
Chief Accounting Officer
CERTIFICATION
I, William Kennedy, the Chief Executive Officer of World Transport Authority,
Inc. certify that:
1. I have reviewed this quarter-end report on Form 10-QSB of World Transport
Authority, Inc.
2. Based on my knowledge, this 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 report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the small business issuer as of, and for, the periods presented in this
report;
4. The small business issuer?s other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for
the small business issuer and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during
the period in which this report is being prepared;
10
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under
my supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles.
(c) Evaluated the effectiveness of the small business issuer?s disclosure
controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as
of the end of the period covered by this report based on such
evaluation; and
(d) Disclosed in this report any change in the small business issuer?s
internal control over financial reporting that occurred during the
small business issuer?s most recent fiscal quarter that has
materially affected, or is reasonably likely to materially affect,
the small business issuer?s internal control over financial
reporting; and
5. The small business issuer?s other certifying officer and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer?s auditors and the
audit committee of the small business issuer?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 small business issuer?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 small business issuer?s
internal control over financial reporting.
Dated: November 19, 2003 /s/William Kennedy
-----------------------
William Kennedy
Chief Executive Officer
11
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Lyle Wardrop, the Chief Accounting Officer of World Transport Authority,
Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, 18 U.S.C. Section 1350, that to the best of my knowledge:
(1) the Quarterly Report on Form 10-QSB of the Company for the quarter
ended September 30, 2003 (the "Report") fully complies with the
requirements of Section 13 (a) or 15 (d) of the Securities Exchange
Act of 1934 (15 U.S.C. 78m or 78o(d)); and
(2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.
Dated: November 19, 2003
/s/Lyle Wardrop
------------------------------------
Name: Lyle Wardrop
Title: Chief Accounting Officer
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, William Kennedy, the Chief Executive Officer of World Transport Authority,
Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, 18 U.S.C. Section 1350, that to the best of my knowledge:
(1) the Quarterly Report on Form 10-KSB of the Company for the year ended
September 30, 2003 (the "Report") fully complies with the
requirements of Section 13 (a) or 15 (d) of the Securities Exchange
Act of 1934 (15 U.S.C. 78m or 78o(d)); and
(2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.
Dated: November 19, 2003
/s/William Kennedy
------------------------------------
Name: William Kennedy
Title: Chief Executive Officer
12