UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
__X__ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended September 30, 1999
_____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _______
Commission file number: 0-30156
WHATSONLINE.COM, INC.
---------------------
(exact name of registrant as specified in its charter)
NEVADA 98-0170247
- ------ ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Suite 311 - 15 Wertheim Court, Richmond, Ontario L4B 3H7
- --------------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (800) 798-9398
Indicate by check mark whether the registrant: (1) has filed all reports
required 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 the Registrant's Common Stock, $0.00001 par value, as of
November 5, 1999: 23,132,404
----------
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WHATSONLINE.COM, INC.
FORM 10-QSB, QUARTER ENDED SEPTEMBER 30, 1999
INDEX
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheet.....................................................3
Consolidated Statement of Operations...........................................4
Consolidated Statement of Stockholder's Equity.................................5
Consolidated Statement of Cash Flows...........................................8
Interim Consolidated Statement of Cash Flows. .................................9
Notes to Consolidated Financial Statements . . . . . .........................10
All schedules are omitted because they are not applicable or the required
information is shown in the financial statements or notes thereto.
Item 2 Management's Discussion and Analysis . . . . . . . . . . . . . . . .11
PART II OTHER INFORMATION
Item 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . 13
Item 2 Changes in Securities . . . . . . . . . . . . . . . . . . . . . . . 13
Item 3 Defaults Upon Senior Securities . . . . . . . . . . . . . . . . . . 13
Item 4 Submission of Matters to a Vote of Security Holders . . . . . . . . 13
Item 5 Other Information . . . . . . . . . . . . . . . . . . . . . . . . . 13
Item 6 Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . 13
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
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<TABLE>
<CAPTION>
Item 1 Financial Statements
- --------------------------------------
WHATSONLINE.COM, INC.
CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1999 AND DECEMBER 31, 1998
<S> <C> <C>
September 30, December 31,
1999 (Unaudited) 1998 (Audited)
---------------- --------------
ASSETS
Current Assets
Cash and Cash Equivalents $ 573,164 $ 1,225,276
Other Receivable 50,000 0
Security Deposits 673 0
Property and Equipment, Net 33,465 7,937
Other Assets
Goodwill 0 0
Organization Costs 649 649
----------------
Total Assets $ 657,950 $ 1,233,862
================ =============
LIABILITIES AND STOCKHOLDERS' EQUIITY
$ 9,405 $ 17,814
Stockholders' Equity
Preferred Stock: Authorized $0.0001 Par Value, 5,000,000 shares;
Issued and Outstanding, NONE 0 0
Common Stock: Authorized $0.00001 Par Value, 100,000,000 shares;
Issued and Outstanding, 23,132,404 and 11,526,202 at June 30,1999
and December 31, 1998, respectively 231 115
Addition Paid In Capital 2,083,776 2,043,892
Loss Accumulated During the Development Stage (1,435,462) (827,960)
----------------- --------------
Total Stockholders' Equity 648,544 1,233,862
----------------- --------------
Total Liabilities and Stockholder's Equity $ 657,950 $ 1,233,862
================ =============
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
<S> <C> <C> <C> <C>
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
The Three The Three The Nine The Nine
Months Months Months Months
Period Ended Period Ended Period Ended Period Ended
Sept 30,1999 Sept 30,1998 Sept 30,1999 Sept 30,1998
------------ ------------ ------------ -------------
Revenues $0 $0 $0 $0
Operating Expenses
General and Administrative $199,850 $143,867 $637,191 $ 194,652
------------ ------------ ------------ --------------
Operating Loss ($199,850) ($143,867) ($637,191) ($194,652)
Other Income
Interest Income 8,720 12,345 29,689 $ 51,521
------------ ------------ ------------ --------------
Net Loss Available to Common Stockholders ($191,130) ($131,522) ($607,502) ($143,131)
============ ============ ============ ==============
Loss Per Weighted Average Share of Common
Stock (0.01) (0.01) (0.03) (0.01)
============= ============= ============= ==============
Weighted Average Number of Common Shares
Outstanding 23,132,404 11,526,202 23,132,404 11,526,202
============ ============ ============ ==============
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM INCEPTION (JULY 14, 1983) THROUGH SEPTEMBER 30, 1999
<S> <C> <C> <C> <C> <C> <C> <C>
Loss
Accumulated
Additional During the
Preferred Stock Common Stock Paid In Development
Shares Amounts Shares Amounts Capital Stage Total
--------- ------- ------- ------- ---------- ----------- -----
Common Stock Issued For Cash
at $0.003 Per Share, August 26, 1983 0 $0 5,141,000 $ 5,141 $ 9,859 $0 $ 15,000
Net Loss From Inception (July 14,1983)
(2,888) (2,888)
Through December 31, 1983 --------- ------- --------- ------ ---------- ----------- --------
Balance, December 31, 1983 0 0 5,141,000 5,141 9,859 (2,888) 12,112
Common Stock Issued-Public Offering
at $0.01Per Share, October 1984 13,009,000 13,009 117,081 130,090
Cost of Offering (27,547) (27,547)
Net Loss, Year Ended December 31, 1984 (15,327) (15,327)
--------- ------- ---------- ------ ---------- ------------ --------
Balance, December 31, 1984 0 0 18,150,000 18,150 99,393 (18,215) 99,328
Capital Contribution, 1990 4,364 4,364
Net Loss, Year Ended December 31, 1985
Through 1990 (103,692) (103,692)
--------- ------- ---------- ------ ---------- ------------ --------
Balance, December 31, 1990 0 0 18,150,000 18,150 103,757 (121,907) 0
Capital Contribution, 1991 100 100
Net Loss,Year Ended December 31,1991 (100) (100)
--------- ------- ---------- ------ ---------- ----------- --------
Balance, December 31, 1991 0 0 18,150,000 18,150 103,857 (122,007) 0
Net Loss, Year Ended December 31, 1992 (141) (141)
--------- ------- ---------- ------ ---------- ----------- --------
Balance, December 31, 1992 0 0 18,150,000 18,150 103,857 (122,148) (141)
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM INCEPTION (JULY 14, 1983) THROUGH SEPTEMBER 30, 1999
<S> <C> <C> <C> <C> <C> <C> <C>
Loss
Accumulated
Additional During the
Preferred Stock Common Stock Paid In Development
Shares Amounts Shares Amounts Capital Stage Total
--------- ------- ------ ------- ----------- ----------- -----
Net Loss, Year Ended December 31,1993 (204) (204)
--------- ------- ------ ------- ----------- ----------- -----
Balance, December 31, 1993 0 0 18,150,000 18,150 103,857 (122,352) (345)
Net Loss, Year Ended December 31,1994 (100) (100)
--------- ------- ---------- ------- ---------- ----------- ------
Balance, December 31, 1994 0 0 18,150,000 18,150 103,857 (122,452) (445)
Common Stock Issued To Satisfy Current
Liabilities at $0.001 Per share,
December 31, 1995 20,000,000 20,000 20,000
Net Loss, Year Ended December 31,1995 (22,215) (22,215)
--------- ------- ---------- ------- ---------- ----------- -------
Balance, December 31, 1995 0 0 38,150,000 38,150 103,857 (144,667) (2,660)
500:1 Reverse Stock Split, April 15, 1996 (38,073,798) (38,074) 38,074 0
Common Stock Issued In Exchange For
Services at $0.005 Per Share, April 16,
1996
4,000,000 4,000 (2,000) 2,000
Common Stock Issued For Cash at $0.05
Per Share, May 9, 1996 4,000,000 4,000 196,000 200,000
Net Loss, Year Ended December 31, 1996 (195,628) (195,628)
--------- ------- ---------- ------- ---------- ----------- ---------
Balance, December 31, 1996 0 0 8,076,202 8,076 335,931 (340,295) 3,712
Common Stock Issued For Cash and
Services at $0.15 Per Share, June 30,
1997
2,000,000 2,000 298,000 300,000
Adjustment For Change in Par Value
From $0.001 to $0.00001 (9,975) 9,975 0
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
CONSOLIDATED STATEMENT OF STOKHOLDERS' EQUITY
FOR THE PERIOD FORM INCEPTION (JULY 14, 1983) THROUGH SEPTEMBER 30, 1999
<S> <C> <C> <C> <C> <C> <C> <C>
Loss
Accumulated
Additional During the
Preferred Stock Common Stock Paid In Development
Shares Amounts Shares Amounts Capital Stage Total
--------- ------- ------- ------- ---------- ----------- -----
Common Stock Issued For Cash at $0.50
Per Share, October 24, 1997 1,000,000 10 499,990 500,000
Common Stock Issued For Cash at $0.20
Per Share, December 19, 1997 450,000 4 899,996 900,000
Net Loss, Year Ended December 31,1997 (255,787) (255,787)
--------- -------- ---------- ------- ---------- ----------- ----------
Balance, December 31, 1997 0 0 11,526,202 115 2,043,892 (596,082) 1,447,925
Net Loss, Year Ended December 31, 1998 (231,878) (231,878)
--------- -------- ---------- ------- ---------- ----------- ----------
Balance, December 31, 1998 0 0 11,526,202 115 2,043,892 (827,960) 1,216,047
Forward Split 2:1, January, 1999 0 0 11,526,202 115 (115) 0
Stock Options Exercised at $1.00 Per
Share, February, 1999 0 0 6,000 0 6,000 6,000
Stock Options Exercised at $1.00 Per
Share, March, 1999 0 0 3,000 0 3,000 3,000
Post Split 2:1, March 1999 0 0 9,000 0 (0) 0
Net Loss for the period ended March 31.
1999 (293,595) (293,595)
--------- -------- ---------- ------- ---------- ----------- ----------
Balance, March 31, 1999 0 0 23,070,404 230 2,052,777 (1,121,555) 931,452
Stock Options Exercised at $1.00 Per
Share, April, 1999 0 0 31,000 0 31,000 31,000
Post Split 2:1, June 1999 0 0 31,000 0 0 0
Net Loss for the period ended June 30,1999 (122,777) (122,777)
--------- -------- ---------- ------- ---------- ----------- ----------
Balance, June 30, 1999 0 0 23,132,404 231 2,083,776 (1,244,332) 839,675
Net Loss for the period ended Sept 30,1999 (191,130) (191,130)
--------- -------- ---------- ------- ---------- ----------- ----------
Balance, September 30, 1999 0 0 23,132,404 231 2,083,776 (1,435,462) 648,545
========= ======== ========== ======= ========== =========== ==========
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1999 AND 1998
AND FROM INCEPTION (JULY 14, 1983) TO SEPTEMBER 30, 1999
<S> <C> <C> <C>
(Unaudited) (Unaudited) (Unaudited)
Nine Months Nine Months From Inception
Ended Ended To Sept 30
Sept 30, 1999 Sept 30, 1998 1999
------------- ------------- --------------
Cash Flows From Operating Activities:
Net Loss $ (607,502) $ (143,131) $ (1,435,462)
Adjustments to Reconcile Net Loss to Net Cash
Changes in Assets and Liabilities
Depreciation 0 927 1,984
(Increase) Decrease in Security Deposit (673) (2145) (673)
Increase (Decrease) in Accrued Liabilities (8,409) 0 9,405
(Increase) Decrease in Organization Costs 0 (649) (649)
Common Stock Issued for Services 0 257,000
Common Stock Issued to Satisfy Current Liabilities 0 20,000
------------- ------------ --------------
Total Adjustments (9,082) (1,867) 237,067
------------- ------------ --------------
Net Cash Used In Operating Activities (616,584) (144,998) (1,148,394)
Cash Flows From Investing Activities
Purchase of Property and Equipment (25,528) (9,921) (35,449)
Investment, Cash Paid for Acquisition (50,000) (29,000)
------------- ------------ ---------------
Net Cash Flows Used In Investing Activities (75,528) (38,921) (35,449)
Cash Flows From Financing Activities
Proceed From the Issurance of Common Stock 0 0 1,790,090
Cost of Public Offering 0 0 (27,547)
Capital Contributions 0 0 4,464
Proceeds From Stock Options Exercised 40,000 0 40,000
------------- ----------- --------------
Net Cash Provided By Financing Activities 40,000 0 1,807,007
Increase (Decrease) in Cash and Cash Equivalents (652,112) (183,919) 573,164
Cash and Cash Equivalents at Beginning of Period 1,225,276 1,447,925 0
Cash and Cash Equivalents at End of Period $ 573,164 $ 1,264,006 $ 573,164
============= =========== ==============
</TABLE>
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<TABLE>
<CAPTION>
WHATSONLINE.COM, INC.
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1999 AND 1998
AND FROM INCEPTION (JULY 14, 1983) TO SEPTEMBER 30, 1999
<S> <C> <C> <C>
(Unaudited) (Unaudited) (Unaudited)
Nine Months Nine Months Inception to
Ended Sep 30 1999 Ended Sep 30 1998 Sept 30 1999
----------------- ----------------- -------------
Supplemental Disclosure of Cash Flow Information:
Cash paid for:
Interest $0 $0 $0
================= =============== ============
Income Taxes $0 $0 $0
================= =============== ============
Noncash Investing and Financing Activities:
Issurance of Common Stock for Services $0 $0 $257,000
================= =============== ============
Common Stock Issued to Satisfy Current Liabilities $0 $0 $20,000
================= =============== ============
</TABLE>
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WHATSONLINE.COM, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1999 AND 1998
1. PRESENTATION OF INTERIM INFORMATION
The accompanying unaudited interim consolidated financial statements have been
prepared in accordance with Form generally accepted accounting practices and in
the opinion of management of WhatsOnline.Com, Inc. (formerly American Alliance
Corporation) (the Company), include all normal adjustments considered necessary
to present fairly the financial position as of September 30, 1999, and the
results of operations for the nine months ended September 30, 1999 and 1998.
These results have been determined on the basis of generally accepted accounting
principles and practices and applied consistently with those used in the
preparation of the Company's audited consolidated financial statements and notes
for the year ended December 31, 1998.
Certain information and footnote disclosures normally included in the financial
statements presented in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that the accompanying unaudited
interim consolidated financial statements be read in conjunction with the
financial statements and notes thereto incorporated by reference in the
Company's 1998 audited consolidated financial statements.
Item 2 Management's Discussion and Analysis of Financial Condition and Results
- --------------------------------------------------------------------------------
of Operations
- -------------
When used in this discussion, the words "believes", "anticipates", "expects" and
similar expressions are intended to identify forward-looking statements. Such
statements are subject to certain risks and uncertainties, which could cause
actual results to differ materially from those projected. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
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only as of the date hereof. The Company undertakes no obligation to republish
revised forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events. Readers are
also urged to carefully review and consider the various disclosures made by the
Company which attempt to advise interested parties of the factors which affect
the Company's business, in this report, as well as other reports filed with the
Securities and Exchange Commission.
Overview
- --------
In January, 1999, the Company entered into the field of targeted Internet
streaming with the launch of its portal EviewOnline.com. The Company's objective
is to make available aggregated audio and video content, with particular
emphasis on entertainment, news, sports, fashion and business. In April, 1999,
the Company acquired the domain name www.whatsonline.com for $50,000 and merged
the contents of EviewOnline.com into WhatsOnline.com.
As of September 30, 1999, the Company has not generated any revenues from
WhatsOnline.com due to the early stage nature of the Company's business, and has
incurred ongoing operating losses due to costs related to research, business
development, website development, management and staff recruitment, development
of advertising and marketing programs, and other costs associated with
establishing corporate infrastructure necessary for developing an online asset
such as WhatsOnline.com. The Company plans to use this infrastructure to develop
additional Internet properties which can potentially add to the Company's future
revenue potential.
Results of Operations
- ---------------------
Revenues. Due to the early stage of the Company's business, the Company has not
generated any revenues for the nine month period ending September 30, 1999, nor
for the twelve month period ending December 31, 1998. To date, the Company has
not relied on revenues for funding.
General and Administrative Expenses. During the three months ended September 30,
1999, the Company incurred $199,850 in general and administrative expenses, an
increase of 39% from third quarter 1998 expense of $143,867. This increase is
due primarily to costs related to additional staffing needs and expenses related
to website development. General and administrative expenses for the nine month
period ended September 30, 1999 increased 227% to $637,191, as compared to
$194,652 for the same nine period in 1998. The increase in the third quarter is
primarily attributable to additional salary and operating expenses related to
the development of the Company's business.
Interest Income. Interest income was $8,720 and $12,345 for the three month
period ended September 30, 1999 and 1998, respectively. Interest income for the
nine month period ended September 30, 1999 and decreased from $51,521 to $29,689
respectively. The decrease is primarily attributable to the lower amount of cash
invested in interest bearing accounts during 1999. Interest earned in the future
will be dependent on Company funding cycles and prevailing interest rates.
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Provision for Income Taxes. As of September 30, 1999, the Company's accumulated
deficit was $1,435,462. Accordingly, the Company has recorded a full valuation
allowance against any income tax benefit to date.
Liquidity and Capital Resources
- -------------------------------
As of September 30, 1999, the Company's cash balance was $573,164, compared to
$1,225,276 as at December 31, 1998. The Company has financed its operations
primarily through private placement of Common Shares and the exercise of Stock
Options.
The Company's future funding requirements will depend on numerous factors. Among
these factors include the Company's ability to establish and profitably operate
the Company's current and any future online properties, to recruit and train
qualified management and technical personnel, compete against any potential
technological advances in the field of media streaming and the Company's ability
to compete against other better capitalized corporations who offer similar
services.
The Company expects to incur losses as it expands its business. The Company may
raise additional funds through private or public equity investment in order to
expand the range and scope of its business operations.
Year 2000
- ---------
The Year 2000 issue arose because many existing computer programs use only the
last two digits to refer to a year. Therefore, these computer programs do not
properly recognize a year that begins with 20 instead of 19. If not corrected,
many computer applications could fail or create erroneous results.
Management has initiated a program to prepare the company's systems for the year
2000. The company is engaged in testing and fixing applications to ensure they
are Year 2000 ready. The company does not separately track the internal costs
incurred for the Year 2000 project, the principal cost is the related payroll
cost for certain corporate staff. The company currently does not expect these
costs to be material nor does it expect any significant interruption to its
operations because of Year 2000 problems.
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PART II -- OTHER INFORMATION
Item 1 Legal Proceedings
- ---------------------------
None
Item 2 Changes in Securities
- -------------------------------
On May 4, 1999, the Board of Directors approved a forward split of its common
stock, effective May 14, 1999, of the Company's common stock on a two-for-one
basis, with the par value remaining the same. All per share and per share
information have been adjusted retroactively to reflect the stock split.
Item 3 Defaults Upon Senior Securities
- -----------------------------------------
None
Item 4 Submission of Matters to a Vote of Security Holders
- -------------------------------------------------------------
None
Item 5 Other Information
- ---------------------------
None
Item 6 Exhibits and Reports on Form 8-K
- ------------------------------------------
None
Signature Page
- --------------
Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
WHATSONLINE.COM, INC.
/s/ Kesar S. Dhaliwal
-----------------------------
Kesar S. Dhaliwal
CEO and President
Dated: November 8, 1999
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