UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934.
For the quarter ended March 31, 2002 Commission file number 000-33151
Voyager Entertainment International, Inc.
(Exact name of registrant as specified in its charter)
North Dakota 45-0420093
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4483 West Reno Avenue
Las Vegas, Nevada 89118
(Address of principal executive offices) (Zip Code)
(702) 221-8070
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
The number of shares of Common Stock, $0.001 par value, outstanding on
May 17, 2002, was 34,340,000 shares, held by approximately 68 stockholders.
As of May 17, 2002, 125,000 shares of common stock were issued and held by
the Company.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
March 31, 2002
INDEX
PART I - FINANCIAL INFORMATION Page No.
Item 1. Unaudited Financial Statements
Consolidated Balance Sheets 3
Consolidated Statement of Operations (Unaudited) 4
Consolidated Statement of Stockholders' Deficiency 5-6
Consolidated Statements of Cash Flow (Unaudited) 7
Notes to Consolidated Financial Statements (Unaudited) 8-14
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation 15
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 17
Item 2. Changes in Securities 18
Item 3. Defaults by the Company upon its
Senior Securities 18
Item 4. Submission of Matter to a Vote of
Security Holders 18
Item 5. Other Information 19
Item 6. Exhibits and Reports on Form 8-K 19
SIGNATURES 21
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2002 2001
ASSETS (Unaudited)
Current Assets
Cash and cash equivalents $ 9,833 $ 256
Prepaid Expenses 5,867 267
------------- --------------
Total Assets $ 15,700 $ 523
============= ==============
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities
Accounts payable and accrued expenses $ 25,000 $ 110,000
Due from related parties - 44,148
------------- --------------
Total Liabilities 25,000 154,148
------------- --------------
Commitments and contingencies - -
STOCKHOLDERS' DEFICIENCY
Preferred stock, $.001 par value;
25,000,000 shares authorized;
1,500,000 shares of series A issued and
outstanding 1,500 -
Common stock, $.001 par value; 100,000,000
shares authorized;
34,015,000 and 15,000,000 shares issued
And outstanding; respectively 34,015 15,000
Additional paid-in-capital 427,485 20,000
Deficit accumulated during development (472,300) (188,625)
stage ------------ -------------
Total Stockholders' Deficiency (9,300) (153,625)
------------- --------------
TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIENCY $ 15,700 $ 523
=========== ==============
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
For the
Period From
Inception
(March 1,
Three Months Ended 1997) to
March 31, March 31,
2002 2001 2002
----------------------------------
NET SALES $ - $ - $ -
---------------------------------
OPERATING EXPENSES
Project costs 5,154 - 52,890
Professional and consulting fees 251,245 - 375,634
Other operating expenses 27,276 155 43,776
---------------------------------
Total operating expenses 283,675 155 472,300
---------------------------------
LOSS FROM OPERATIONS BEFORE
PROVISION FOR INCOME TAXES (283,675) (155) (472,300)
PROVISION FOR INCOME TAXES - - -
---------------------------------
NET LOSS $(283,675) $ (155) $(472,300)
==================================
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC. AND SUBSIDIARIES
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIENCY
FOR THE PERIOD FROM INCEPTION (MARCH 1, 1997) TO MARCH 31, 2002
Preferred Series A
Stock Common Stock
Shares Amount Shares Amount
Balance at inception - March 1,
1997
(as restated for reorganization) - $ - 15,000,000 $ 15,000
-----------------------------------------
Net loss for year ended
December 31, 1997 - - - -
-----------------------------------------
Balance at December 31, 1997 - - 15,000,000 15,000
Net loss for year ended
December 31, 1998 - - - -
-----------------------------------------
Balance at December 31, 1998 - - 15,000,000 15,000
Net loss for year ended
December 31, 1999 - - - -
-----------------------------------------
Balance at December 31, 1999 - - 15,000,000 15,000
Net loss for year ended
December 31, 2000 - - - -
-----------------------------------------
Balance at December 31, 2000 - - 15,000,000 15,000
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC. AND SUBSIDIARIES
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIENCY
FOR THE PERIOD FROM INCEPTION (MARCH 1, 1997) TO MARCH 31, 2002
(CONTINUED)
Deficit
Accumulated
Additional During the Total
Paid-in Development Stockholders'
Capital Stage Equity
Balance at inception - March 1,
1997
(as restated for reorganization) $ 20,000 $ - $ 35,000
Net loss for year ended
December 31, 1997 - (34,361) (34,361)
-----------------------------------------
Balance at December 31, 1997 20,000 (34,361) 639
Net loss for year ended
December 31, 1998 - (11,121) (11,121)
-----------------------------------------
Balance at December 31, 1998 20,000 (45,482) (10,482)
Net loss for year ended
December 31, 1999 - (3,428) (3,428)
-----------------------------------------
Balance at December 31, 1999 20,000 (48,910) (13,910)
Net loss for year ended
December 31, 2000 - (38,283) (38,283)
-----------------------------------------
Balance at December 31, 2000 20,000 (87,193) (52,193)
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC. AND SUBSIDIARIES
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIENCY (Continued)
FOR THE PERIOD FROM INCEPTION (MARCH 1, 1997) TO MARCH 31, 2002
Preferred Series A
Stock Common Stock
Shares Amount Shares Amount
Balance at December 31, 2000 - - 15,000,000 15,000
Net loss for year ended
December 31, 2001 - - - -
--------------------------------------------
Balance at December 31, 2001 - - 15,000,000 15,000
Issuance of stock for cash and
services (pre-merger) 1,500,000 1,500 6,600,000 6,600
Acquisition of net assets of
Dakota (unaudited) - - 11,615,000 11,615
Issuance of common stock for
cash (unaudited) - - 800,000 800
Net loss for the period from
January 1
to March 31, 2002 (unaudited) - - - -
---------------------------------------------
Balance at March 31, 2002
(unaudited) 1,500,000 $ 1,500 34,015,000 $ 34,015
=============================================
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC. AND SUBSIDIARIES
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIENCY (Continued)
FOR THE PERIOD FROM INCEPTION (MARCH 1, 1997) TO MARCH 31, 2002
Deficit
Accumulated
Additional During the Total
Paid-in Development Stockholders'
Capital Stage Equity
Balance at December 31, 2000 20,000 (87,193) (52,193)
Net loss for year ended
December 31, 2001 - (101,432) (101,432)
---------------------------------------
Balance at December 31, 2001 20,000 (188,625) (153,625)
Issuance of stock for cash and
services (pre-merger) 19,900 - 28,000
Acquisition of net assets of Dakota
(unaudited) (11,615) - -
Issuance of common stock for cash
(unaudited) 399,200 - 400,000
Net loss for the period from
January 1
to March 31, 2002 (unaudited) - (283,675) (283,675)
-----------------------------------------
Balance at March 31, 2002
(unaudited) $ 427,485 $ (472,300) $ (9,300)
=========================================
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the
Period
From
Inception
(March 1,
1997) to
Three Months Ended March 31,
March 31,
2002 2001 2002
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $(283,675) $(155) $(472,300)
Adjustments to Reconcile Net Loss
to Net
Cash Used In Operating
Activities:
Issuance of common stock for
services 18,000 - 18,000
Changes in certain assets and
liabilities:
Increase in Prepaid Expenses (5,600) - (5,867)
Increase in Accounts Payable
and Accrued Expenses (85,000) - 25,000
------------------------------------
NET CASH USED IN OPERATING
ACTIVITIES (356,275) (155) (435,167)
------------------------------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Members' Contributions - - 35,000
Proceeds from sale of common
stock 410,000 - 410,000
Decrease in due to related
parties (44,148) - -
------------------------------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 365,852 - 445,000
------------------------------------
NET INCREASE (DECREASE)
IN CASH AND CASH EQUIVALENTS 9,577 (155) 9,833
CASH AND CASH EQUIVALENTS
- BEGINNING 256 319 -
------------------------------------
CASH AND CASH EQUIVALENTS
- ENDING $9,833 $164 $9,833
====================================
CASH PAID DURING THE YEAR FOR:
Interest Expense $ - $ - $ -
====================================
Income Taxes $ - $ - $ -
====================================
NON-CASH FINANCING ACTIVITY:
* For the period from January 1, 2002 to January 31, 2002, the Company
issued shares of common and preferred stock for services, totaling $18,000.
The accompanying notes are an integral part of the consolidated financial
statements.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United
States of America for interim financial information and with the
instructions to Form 10-QSB and Regulation S-B. Accordingly, they do not
include all of the information and footnotes required by accounting
principles generally accepted in the United States of America 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.
For further information, refer to the financial statements and footnotes
included in Form 10-KSB for the year ended October 31, 2001 and form 8K/A
filed on March 4, 2002.
The result of operations for the three months ending March 31, 2002 are not
necessarily indicative of the results to be expected for the full year.
The accompanying consolidated financial statements include the accounts of
Voyager Entertainment International, Inc. (the "Company"), formerly known
as Dakota Imaging, Inc., ("Dakota"), incorporated under the laws of the
state of North Dakota on January 31, 1991 and its subsidiaries:
a) Voyager Ventures, Inc. ("Ventures"), was incorporated under the laws of
the State of Nevada on January 15, 2002 (owned 100% by the Company); and
b) Outland Development, LLC ("Outland"), a limited liability company
formed under the laws of the State of Nevada on March 1, 1997(owned 100% by
Ventures).
The Company is currently a development stage enterprise reporting under the
provisions of Statement of Financial Accounting Standards ("SFAS") No. 7.
Dakota entered into an agreement and Plan of Merger (the "Agreement"),
dated as of February 1, 2002, with Ventures and Dakota Subsidiary Corp.
("DSC"), an inactive Nevada corporation. The agreement became effective
February 8, 2002, when Ventures completed a reverse triangular merger
between DSC and Dakota, whereby Dakota issued 3,660,000 shares of its
Series A preferred stock in exchange for 100% of Venture's outstanding
common stock. Pursuant to the terms of the merger, Ventures merged with DSC
wherein DSC ceased to exist and Ventures became a wholly owned subsidiary
of Dakota.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Basis of Presentation (continued)
The Series A preferred stock carries the following rights and preferences:
* 10 to 1 voting rights per share
* Each share has 10 for 1 conversion rights to shares of common stock
(every 1 share of Series A preferred stock has the right to convert into
10 shares of common stock)
* No redemption rights
* No face value
Concurrent with the closing of the Merger:
a) Dakota cancelled 47,000,000 shares (9,400,000 shares prior to 5 for 1
forward split) held by certain shareholders of Dakota in exchange for certain
assets and liabilities of Dakota; and
b) Dakota issued 21,600,000 shares of its common stock of Dakota for the
conversion of 2,160,000 shares of the Series A preferred stock issued.
As a result of the agreement, Venture's former shareholders obtained
control of Dakota through their ownership interest in the Series A
preferred stock held and converted, therefore this acquisition has been
treated as a recapitalization of Ventures for accounting purposes.
During March 2002, the Company decided to change its name from Dakota
Imaging, Inc. to Voyager Entertainment International, Inc. and also change
its fiscal year-end from October 31 to December 31.
The Company has limited operations and is still in the development stage.
The Company will need to raise a substantial amount of capital in order to
continue its business plan. This situation raises substantial doubt about
its ability to continue as a going concern. The accompanying consolidated
financial statements do not include any adjustments relative to the
recoverability and classification of asset carrying amounts or the amount
and classification of liabilities that might result from the outcome of
this uncertainty. Management is currently initiating their business plan
and in the process of raising additional capital. (See Note 6)
Line of Business
The Company is planning the development of the world's tallest Ferris
Wheel, which will house various revolving retail stores, including
restaurants.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Use of Estimates
The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments purchased with original
maturities of three months or less to be cash equivalents.
Concentration of Credit Risk
The Company places its cash in what it believes to be credit-worthy
financial institutions and, at times, may exceed the FDIC $100,000
insurance limit.
Property and Equipment
Property and equipment is recorded at cost. Depreciation is computed using
the straight-line method based upon the estimated useful lives of the
various classes of assets. Maintenance and repairs are charged to expense
as incurred.
Income Taxes
Income taxes are provided for based on the asset and liability method of
accounting pursuant to SFAS No. 109, "Accounting for Income Taxes".
Deferred income taxes, if any, are recorded to reflect the tax consequences
on future years of differences between the tax bases of assets and
liabilities and their financial reporting amounts at each year-end.
Stock-Based Compensation
SFAS No. 123, "Accounting for Stock-Based Compensation," establishes
accounting policies for stock and stock-based awards issued to employees
and non-employees for services rendered and goods received. The Company
records transactions in which services or goods are rendered or received
from non-employees for the issuance of equity securities based on the fair
value of the Company's stock at the date the
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
services are rendered or goods received.
Comprehensive Income
SFAS No. 130, "Reporting Comprehensive Income," establishes standards for
the reporting and display of comprehensive income and its components in
the financial statements. As of March 31, 2002, the Company has no
items that represent comprehensive income and, therefore, has not included
a schedule of comprehensive income in the financial statements.
Recent Accounting Pronouncements
On June 29, 2001, SFAS No. 141, "Business Combinations," was approved by
the FASB, which requires that the purchase method of accounting be used for
all business combinations initiated after June 30, 2001. Goodwill and
certain intangible assets will remain on the balance sheet and not be
amortized. On an annual basis, and when there is reason to suspect that
their values have been diminished or impaired, these assets must be tested
for impairment, and write-downs may be necessary. The Company implemented
SFAS No. 141 on January 1, 2002.
On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible Assets", was
approved by the FASB, which changes the accounting for goodwill from an
amortization method to an impairment-only approach. Amortization of
goodwill, including goodwill recorded in past business combinations, will
cease upon adoption of this statement. The Company implemented SFAS No.
142 on January 1, 2002.
During August 2001, SFAS No. 143, "Accounting for Asset Retirement
Obligation" was issued. SFAS No. 143 is effective for fiscal years
beginning after June 15, 2002, and will require companies to record a
liability for asset retirement obligations in the period in which they are
incurred, which typically could be upon completion or shortly thereafter.
The FASB decided to limit the scope to legal obligation and the liability
will be recorded at fair value. The effect of adoption of this standard on
Company's results of operations and financial positions is being evaluated.
During August 2001, SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." was issued. SFAS No. 144 is effective for
fiscal years beginning after December 15, 2001. It provides a single
accounting model for long-lived assets to be disposed of and replaces SFAS
No. 121 "Accounting for the Impairment of Long-Lived Assets and Long-Lived
Assets to Be Disposed Of." The effect of adoption of this standard on
Company's results of operations and financial positions is being evaluated.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 2 - REORGANIZATION
Voyager Ventures
The agreement and plan of merger transaction, as discussed in Note 1, with
Dakota, DSC and Ventures has been accounted for in the consolidated
financial statements as a public shell merger. As a result of this
transaction the former shareholders of Ventures acquired or exercised
control over a majority of the shares of Dakota. Accordingly, the
transaction has been treated for accounting purposes as a recapitalization
of Ventures and, therefore, these consolidated financial statements
represent a continuation of the entity, Ventures, not Dakota.
In accounting for this transaction:
i) Ventures is deemed to be the purchaser and surviving company for
accounting purposes. Accordingly, its net assets are included in the balance
sheet at their historical book values;
ii) Control of the net assets and business of Dakota was acquired
effective February 8, 2002, the effective date. This transaction has been
accounted for as a purchase of the assets and liabilities of Dakota by
Ventures at its net book value of $0.
Outland
Ventures entered into an agreement and Plan of Reorganization (the
"Reorganization"), dated as of January 30, 2002 with Outland, whereby
Ventures issued 15,000,000 shares of its common stock in exchange for 100%
of Outland's membership interest. These 15,000,000 shares were subsequently
converted to Dakota stock as described in Note 1.
This transaction has been accounted for in the consolidated financial
statements as a reverse acquisition. As a result of this transaction, the
former members of Outland acquired or exercised control over a majority of
the shares of the Company before and after the reorganization. Accordingly,
the transaction has been treated for accounting purposes as a
recapitalization of Outland. Therefore, these consolidated financial
statements represent a continuation of Outland, not Ventures.
The consolidated financial statements presented include the accounts of
Outland from its inception (March 1, 1997).
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 3 - INCOME TAXES
Prior to December 31, 2001, Outland reported its income taxes as a limited
liability company and, as such, reported its income as a partnership
whereby liability or taxes was that of the individual members rather than
that of the Company. As of March 31, 2002, the Company has a deferred tax
asset consisting of net operating losses which are fully reserved for.
NOTE 4 - COMMITMENTS AND CONTINGENCIES
On November 11, 2001, the Company entered into a fee agreement with a
Nevada corporation for a purchase option to acquire certain property. The
agreement states if certain property is acquired, a $100,000 cash payment
is due upon execution, as well as the issuance of a note payable totaling
$2,500,000. As of March 31, 2002, this purchase option was not exercised.
During January 2002, the Company entered into a month-to-month office lease
totaling approximately $2,500 per month.
NOTE 5 - STOCKHOLDERS' EQUITY
Common stock
The aggregate number of shares of common stock that the Company has
authority to issue is 100,000,000 shares at a par value of $0.001. As of
March 31, 2002, 34,015,000 shares were issued and outstanding.
Preferred stock
The aggregate number of shares of preferred stock that the Company has
authority to issue is 25,000,000 shares at a par value of $0.001. As of
March 31, 2002, 1,500,000 shares of preferred series A stock were issued
and outstanding.
The Series A preferred stock carries the following rights and preferences:
* 10 to 1 voting rights per share
* Each share has 10 for 1 conversion rights to shares of common stock
(every 1 share of Series A preferred stock has the right to convert into
10 shares of common stock)
* No redemption rights
* No face value
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Stock Issuances
On February 8, 2002, the Company effectuated a 5 for 1 forward split of its
11,723,000 pre reverse triangular merger issued and outstanding shares of
common stock resulting in the Company having 58,615,000 forward-split common
shares. Concurrently with the 5 for 1 forward split, the Company cancelled
47,000,000 shares of its common stock, leaving 11,615,000 shares outstanding
pre reverse triangular merger.
Effective February 8, 2002 the Company, as part of the reverse triangular
merger, issued 3,660,000 shares of its Series A preferred stock in exchange
for 100% of Voyager's outstanding common stock. Additionally, simultaneously
upon closing of the Merger 2,160,000 shares of the Series A preferred stock
immediately converted into 21,600,000 shares of common stock.
On February 15, 2002 the Company sold 800,000 restricted shares of common
stock at a price of $.50 per share for $400,000.
NOTE 6 - SUBSEQUENT EVENTS
On April 5, 2002, the Company issued 200,000 restricted shares of common
stock in exchange for services performed.
On April 5, 2002, the Company issued 125,000 restricted common shares for
Investor Relations Services. The shares are being held by the Company and
have not been delivered to the intended provider of the services. The Company
anticipates canceling the shares pending the execution of a definitive
agreement with the service provider.
On May 2, 2002, the Company incorporated Voyager Entertainment Holdings,
Inc., a Nevada corporation, as a wholly owned subsidiary.
On May 1, 2002, Voyager Entertainment Holdings, Inc. entered into a Purchase
and Sale Agreement for the purchase of plus or minus six (6) acres of real
property located in Las Vegas, Nevada.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
This report contains forward-looking statements. Actual results and
events could differ materially from those projected, anticipated, or
implicit, in the forward-looking statements as a result of the risk factors
set forth below and elsewhere in this report.
With the execution of historical matters, the matters discussed herein are
forward looking statements that involve risks and uncertainties. Forward-
looking statements include, but are not limited to, statements concerning
anticipated trends in revenues and net income, the date of introduction or
completion of our products, projections concerning operations and available
cash flow. Our actual results could differ materially from the results
discussed in such forward-looking statements primarily as the result of
insufficient cash to pursue production and marketing efforts. The following
discussion of our financial condition and results of operations should be
read in conjunction with our financial statements and the related notes
thereto appearing elsewhere herein.
Overview
Voyager Entertainment International, Inc. formerly named Dakota Imaging,
Inc. was incorporated in North Dakota on January 31, 1991. Effective
February 8, 2002 the Company completed a reverse triangular merger between
Dakota Subsidiary Corp. ("DSC"), a wholly owned subsidiary of the Company,
and Voyager Ventures, Inc., a Nevada corporation ("Ventures"), whereby the
Company issued 3,660,000 shares of its Series A preferred stock in exchange
for 100% of Ventures outstanding common stock. Pursuant to the terms of the
merger, Ventures merged with DSC wherein DSC ceased to exist and Ventures
became a wholly owned subsidiary of the Company.
On April 2, 2002, the Company held its annual stockholders meeting and
the stockholders voted on and approved changing the Company's name from
Dakota Imaging, Inc. to Voyager Entertainment International, Inc.
Voyager has yet to generate revenues from any source and there is a
substantial going concern issue as to whether Voyager will ever be able to
commercialize its technology and generate sufficient, if any, revenues to
satisfy its working capital requirements. Since inception, Voyager has been
dependent on the sale of its equity securities and loans from affiliates to
satisfy its working capital requirements. Since inception, Voyager has been
dependent on the sale of its equity securities and loans from affiliates to
satisfy its working capital needs. Voyager continues to have a working
capital deficiency that raises substantial concern regarding its ability to
continue as a going concern.
Business of the Company
The Company's current business plan is to build the world's largest
Ferris wheel with 33 vehicles called Sky Cruiser's. The vertical revolving
vehicle will overlook the Las Vegas Strip as it revolves higher than a 50-
story building at 518 feet. One slow rotation in a vehicle will last 24
minutes and each vehicle will travel at 0.652 MPH. The project will include
(i) the "Ferris Wheel" and its related amenities, (ii) a retail mall with
approximately 50,000 square feet of leaseable space, (iii) a parking garage,
(iv) all real property interests at the site, and (v) such other developments
as Owner and Operator mutually agree to include in the Project.
Voyager will require substantial additional funds to fulfill its
business plan and successfully commercialize its technology. Voyager intends
to raise these needed funds from private placements of its securities, debt
financing or internally generated funds from the licensing of its technology
or the sale of products.
Plan of Operation
During the next 12 months the Company plans to focus its efforts on its
development of the Ferris Wheel; however actual production will not commence
until the Company has sufficient capital for production and marketing.
As of March 31, 2002, the Company had only unpaid Officers and Directors
of which none received any compensation. We are dependent upon Richard
Hannigan, President of the Company and Veldon Simpson, CEO and Director. No
employees work full time for the Company.
Liquidity and Capital Resources
A critical component of our operating plan impacting our continued
existence is the ability to obtain additional capital through additional
equity and/or debt financing. We do not anticipate enough positive internal
operating cash flow until such time as we can generate substantial revenues,
which may take the next few years to fully realize. In the event we cannot
obtain the necessary capital to pursue our strategic plan, we may have to
cease or significantly curtail our operations. This would materially impact
our ability to continue operations.
Our near term cash requirements are anticipated to be offset through the
receipt of funds from private placement offerings and loans obtained through
private sources. Since inception, we have financed cash flow requirements
through debt financing and issuance of common stock for cash and services.
As we expand operational activities, we may continue to experience net
negative cash flows from operations, pending receipt of servicing or
licensing fees, and will be required to obtain additional financing to fund
operations through common stock offerings and bank borrowings to the extent
necessary to provide working capital.
Over the next twelve months we believe that existing capital and
anticipated funds from operations will not be sufficient to sustain
operations and planned expansion. Consequently, we will be required to seek
additional capital in the future to fund growth and expansion through
additional equity or debt financing or credit facilities. No assurance can
be made that such financing would be available, and if available it may take
either the form of debt or equity. In either case, the financing could have
a negative impact on our financial condition and our Stockholders.
We anticipate incurring operating losses over the next twelve months.
Our lack of operating history makes predictions of future operating results
difficult to ascertain. Our prospects must be considered in light of the
risks, expenses and difficulties frequently encountered by companies in their
early stage of development, particularly companies in new and rapidly
evolving markets such as technology related companies. Such risks include,
but are not limited to, an evolving and unpredictable business model and the
management of growth. To address these risks we must, among other things,
implement and successfully execute our business and marketing strategy,
continue to develop and upgrade technology and products, respond to
competitive developments, and attract, retain and motivate qualified
personnel. There can be no assurance that we will be successful in
addressing such risks, and the failure to do so can have a material adverse
effect on our business prospects, financial condition and results of
operations.
As of March 31, 2002, the Company had assets of $15,700, and $25,000 of
liabilities. Resulting in a stockholders deficit of ($9,300).
Material Risks
We are a development stage company, recently reorganized and have minimal
operating history, which makes an evaluation of us extremely difficult. At
this stage of our business operations, even with our good faith efforts,
potential investors have a high probability of losing their investment.
As a result of our recent reorganization we have yet to generate
revenues from operations and have been focused on organizational, start-up,
market analysis and fund raising activities since we incorporated. Although
we have a project to market, there is nothing at this time on which to base
an assumption that our business operations will prove to be successful or
that we will ever be able to operate profitably. Our future operating results
will depend on many factors, including our ability to raise adequate working
capital, demand and acceptance of our project, the level of our competition
and our ability to attract and maintain key management and employees.
While Management believes its estimates of projected occurrences and
events are within the timetable of its business plan, there can be no
guarantees or assurances that the results anticipated will occur.
Our auditor's report reflects the fact that without realization of additional
capital, it would be unlikely for us to continue as a going concern. If we
are unable to continue as a going concern, it is likely that we will continue
in business.
As a result of our deficiency in working capital and other factors, our
auditors have included a paragraph in their report regarding substantial
doubt about our ability to continue as a going concern. Our plans in this
regard are to seek additional funding through future equity private
placements or debt facilities.
PART II--OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
On February 8, 2002, the Company effectuated a 5 for 1 forward split of
its 11,723,000 then issued and outstanding shares of common stock resulting
in the Company having 58,615,000 post split common shares.
Effective February 8, 2002 the Company completed a reverse triangular
merger between Dakota Subsidiary Corp. ("DSC"), a wholly owned subsidiary of
the Company, and Voyager Ventures, Inc., a Nevada corporation ("Voyager"),
whereby the Company issued 3,660,000 shares of its Series A preferred stock
in exchange for 100% of Voyager's outstanding common stock. Concurrent with
the closing of the Merger and the execution of the Property Transfer
Agreement, 47,000,000 shares of the Registrant's common stock were cancelled.
Additionally, simultaneously upon closing of the Merger 2,160,000 shares of
the Series A preferred stock immediately converted into 21,600,000 shares of
common stock, resulting in 33,215,000 shares of common stock issued and
outstanding as of the date of closing of the Merger.
On February 15, 2002 the Company sold 800,000 restricted shares of
common stock at a price of $.50 per share for $400,000 in a transaction
pursuant to an exemption provided by Regulation D 506. The investor as
provided under the terms of the subscription agreement is an accredited
investor as defined in Section 501 of Regulation D.
On April 5, 2002 the Company issued 200,000 restricted shares of common
stock to Norman and Barbara Karp for services as a finder and assisting the
Company in furthering its business plan. The Company believes that the
issuance of the shares was exempt from the registration and prospectus
delivery requirements of the Securities Act of 1933 by virtue of Section
4(2), and Rule 701 thereof. The shares were issued directly by the Company
and did not involve a public offering or general solicitation. The recipient
of the shares had a preexisting relationship with our management, had
performed services for the Company and had full and complete access to the
Company and had the opportunity to speak with management with regards to
their investment decision.
On April 5, 2002 the Company issued 125,000 for Investor Relations
Services. The shares are being held by the Company and have not been
delivered to the intended provider of the services. The Company anticipates
canceling the shares pending the execution of a definitive agreement with the
service provider.
Item 3. Defaults by the Company upon its Senior Securities.
None.
Item 4. Submission of Matter to a Vote of Security Holders.
On April 2, 2002, the Company held its annual stockholders' meeting and
the stockholders voted on and approved the following;
1. The election of a new Board of Directors (Veldon Simpson, and Richard
Hannigan) to serve through the next year;
2. Changing the Company's fiscal year end to December 31;
3. Changing the Company's name from Dakota Imaging, Inc. to Voyager
Entertainment International, Inc.;
4. Amend the Company's Certificate of Incorporation;
5. Amend and restate the Company's Bylaws;
6. The appointment of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C. to serve as
the Company's auditor; and
7. The adoption of a stock option plan providing for options on up to 5
million shares of common stock.
Item 5. Other Information.
Voyager Entertainment Holdings, Inc.
On May 2, 2002, the Company incorporated Voyager Entertainment Holdings,
Inc., a Nevada corporation ("Holdings"), as a wholly owned subsidiary for the
purpose of purchasing 6 acres of real property located on the Las Vegas
Strip.
On May 1, 2002, prior to its incorporation, Holdings entered into a
Purchase and Sale Agreement with F.G. 7-11, L.L.C., a Nevada limited
liability company, for the purchase of plus or minus six (6) acres of real
property commonly located at 3700 Las Vegas Boulevard South, Clark County,
Las Vegas, Nevada.
Some of the material terms of the Purchase and Sale Agreement include,
but are not limited to, the following:
* $100,000 non-refundable deposit
* $72,500,000 purchase price
* property purchased "AS-IS" "WHERE IS"
* closing to be within 90 days of loan/funding commitment
* Company to receive loan/funding commitment by June 5, 2002
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3(i) Articles of Incorporation of Voyager Entertainment Holdings, Inc.
3(ii)Bylaw of Voyager Entertainment Holdings, Inc.
99 Press Release Dated April 9, 2002
99.1 Press Release Dated May 3, 2002
(b) Form 8-K
Form 8-K filed February 15, 2002
Form 8-K/A filed February 15, 2002
Form 8-K/A filed February 19, 2002
Form 8-K/A filed February 25, 2002
Form 8-K filed March 4, 2002
Form 8-K filed April 15, 2002
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.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
(Registrant)
By: /S/Richard Hannigan By: /S/Veldon Simpson
Richard Hannigan Veldon Simpson
President/Treasurer/Director CEO/Director
Date: May 20, 2002 Date: May 20, 2002