- - --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
Form 10-QSB
QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
-----------------------------
For the quarterly period ended September 30, 1999
ZAPWORLD.COM
(Name of small business issuer in its charter)
CALIFORNIA 94-3210624
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
117 Morris Street
Sebastopol, CA 95472
(707) 824-4150
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Securities registered under section 12(b) of the Exchange Act:
None
Securities registered under section 12(g) of the Exchange Act:
None
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 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 No X
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.
4,608,870 shares of common stock as of November 19, 1999.
Transitional Small Business Disclosure Format Yes[ ] No[x]
- - --------------------------------------------------------------------------------
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
ZAPWORLD.COM AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
September 30,
1999
- - --------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash $ 2,341,200
Receivables 772,800
Inventories 1,286,400
Prepaid expenses and other assets 442,800
-----------
Total current assets 4,843,200
-----------
PROPERTY AND EQUIPMENT 265,100
-----------
OTHER ASSETS
Intangibles, net of accumulated amortization
of $16,600 134,500
Investment in Technology Companies 127,000
Advance to ASCR 99,000
Deposits 100,100
-----------
Total other assets 460,600
-----------
Total assets $ 5,568,900
-----------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 408,500
Accrued liabilities and other expenses 415,200
Customer Deposits 38,700
Notes payable 4,000
Current maturities of long-term debt 3,700
Current maturities of obligations under capital leases 2,900
-----------
Total current liabilities 873,000
-----------
OTHER LIABILITIES
Obligations under capital leases, less current maturities 22,100
Long-Term Debt, less current maturities 39,500
-----------
Total other liabilities 61,600
-----------
STOCKHOLDERS' EQUITY
Common stock, no par value; 10,000,000 shares
authorized, 4,593,532 shares issued and outstanding 8,372,000
Accumulated deficit (3,737,700)
-----------
Total stockholders' equity 4,634,300
-----------
Total liabilities and stockholders' equity $ 5,568,900
-----------
The accompanying notes are an integral part of this financial statement
2
<PAGE>
<TABLE>
ZAPWORLD.COM AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Quarter ended September 30, Nine Months ended September 30,
1999 1998 1999 1998
- - ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET SALES $ 1,767,000 $ 1,229,700 $ 4,444,200 $ 2,554,600
COST & EXPENSES
Cost of Goods Sold 1,379,200 778,500 2,978,400 1,684,900
Selling 280,400 255,700 729,500 665,400
General and administrative 363,500 225,600 877,800 608,000
Research and development 81,600 51,500 204,800 131,400
----------- ----------- ----------- -----------
LOSS FROM OPERATIONS (337,700) (81,600) (346,300) (535,100)
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE)
Interest expense (1,700) (4,500) (77,400) (10,800)
Interest Income 17,700 1,000 41,400 5,700
Other (1,500) (6,000) (8,600) (10,300)
----------- ----------- ----------- -----------
14,500 (9,500) (44,600) (15,400)
----------- ----------- ----------- -----------
NET LOSS $ (323,200) $ (91,100) $ (390,900) $ (550,500)
=========== =========== =========== ===========
NET LOSS
PER COMMON SHARE,
BASIC AND DILUTED $ (0.07) $ (0.03) $ (0.11) $ (0.21)
=========== =========== =========== ===========
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 4,416,249 2,633,500 3,668,118 2,592,400
=========== =========== =========== ===========
<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
3
<PAGE>
<TABLE>
ZAPWORLD.COM AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Nine months ended September 30,
1999 1998
- - -----------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (390,900) $ (550,500)
Adjustments to reconcile net loss to net cash
used by operating activities
Depreciation and amortization 78,700 58,200
Issuance of common stock for services rendered 805,100 3,000
Changes in:
Receivables (489,300) (346,000)
Inventories (652,700) (339,900)
Prepaid expenses (314,200) (40,400)
Deposits (88,200) (67,300)
Other Assets (58,400) (27,100)
Accounts payable 74,200 245,700
Accrued liabilities and other expenses 303,100 (35,200)
----------- -----------
Net cash used in operating activities (732,600) (1,099,500)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of equipment (158,000) (80,100)
Investment in Technology Companies (127,000) --
Advance to ASCR (19,000) --
----------- -----------
Net cash used in investing activities (304,000) (80,100)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of notes & loans payable 27,000 --
Increase in loans payable -- 517,500
Increase in capital leases payable 21,500 --
Sale of common stock, net of stock offering costs 3,750,200 558,000
Principal repayments on long-term debt -- (4,700)
Payments on obligations under capital leases (7,400) (11,800)
Principal repayments on note payable (888,800) (13,500)
----------- -----------
Net cash provided by financing activities 2,902,500 1,045,500
----------- -----------
NET INCREASE/(DECREASE) IN CASH 1,865,900 (134,100)
CASH, beginning of period 475,300 690,500
----------- -----------
CASH, end of period $ 2,341,200 $ 556,400
=========== ===========
<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
4
<PAGE>
<TABLE>
ZAPWORLD.COM AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<CAPTION>
Nine months ended September 30,
1999 1998
- - -------------------------------------------------------------------------------------------------------
<S> <C> <C>
Supplemental cash flow information:
Non-cash investing and financial activities:
Conversion of notes payable and accrued interest into common stock $504,100 --
Stock issued for current and future services 301,000 --
Stock issued for Advance to ASCR 80,000 --
Stock Issued as investment in Big Boy Bicycles 5,000
<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
5
<PAGE>
ZAPWORLD.COM AND SUBSIDIARIES
NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(1) Basis of Presentation
The condensed consolidated financial statements included in this Form 10-QSB
have been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted, pursuant to such rules and regulations, although management believes
the disclosures are adequate to make the information presented not misleading.
The results of operations for any interim period are not necessarily indicative
of results for a full year. These statements should be read in conjunction with
the financial statements and related notes included in the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1998 and prior disclosures
of 10-QSB's and 8-K's.
The condensed consolidated financial statements presented herein as of September
30, 1999, and for the three months and nine months ended September 30, 1999 and
September 30, 1998 reflect, in the opinion of management, all material
adjustments consisting only of normal recurring adjustments necessary for a fair
presentation of the financial position, results of operations and cash flow for
the interim periods.
In July, 1999, the Company incorporated two new legal entities, ZAPWORLD Stores,
Inc. and ZAPWORLD Outlets, Inc., which operate as wholly owned subsidiaries of
the Company.
The net loss per common share is based on the weighted average number of common
shares outstanding in each period. Common stock equivalents associated with
stock options have been excluded from the weighted average shares outstanding
since the effect of these securities would be anti-dilutive.
(2) - RECEIVABLES
September 30, 1999
------------------
Trade accounts receivable $ 807,800
Less allowance for doubtful accounts (35,000)
------------
$ 772,800
------------
(3) - INVENTORIES
September 30, 1999
------------------
Raw materials $ 872,000
Work-in-process 197,800
Finished goods 216,600
------------
$ 1,286,400
------------
(4) - PROPERTY AND EQUIPMENT
September 30, 1999
------------------
Demonstration items $ 89,600
Machinery and equipment 113,700
Equipment under capital leases 45,900
Office furniture and fixtures 44,000
Computers 79,900
Leasehold improvements 62,000
Vehicles 97,700
-------------
532,800
Less accumulated depreciation and amortization (267,700)
-------------
$ 265,100
-------------
6
<PAGE>
(5) - COMMON STOCK
The Company's Common Stock is traded on the OTC Bulletin Board under the stock
symbol "ZAPP". On July 30, 1999, ZAP completed a private placement of 4,000
shares of its common stock for the purpose of investing in a PowerSki test
marketing project and prototyping a utilitarian electric cart/electric
wheelbarrow type vehicle. Additionally, a private placement of 21,001 shares of
the Company's common stock was completed for the purchase of the assets of
American Scooter and Cycle Rentals and 1,000 shares of the Company's common
stock to complete the purchase of the assets of Big Boy Bicycles. Furthermore in
the third quarter of 1999, the Company 1) issued 1,840 shares in payment for
current services, and 2) realized $161,100 in proceeds from the exercise of
employee stock options and issued 247,500 common shares.
(6) - 1999 STOCK OPTION PLAN
In 1999, the Company created a new Employee and Consultant Stock Option Plan of
500,000 shares. As of the end of the third quarter 1999, no shares had been
issued under this plan.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Special Note Regarding Forward-Looking Statements
Certain statements in this Form 10-QSB, including information set forth
under this Item 2. "Management's Discussion and Analysis of Financial Condition
and Results of Operations" constitute "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 (the "ACT").
ZAPWORLD.COM (the "Company") desires to avail itself of certain "safe harbor"
provisions of the Act and is therefore including this special note to enable the
Company to do so. Forward-looking statements included in this Form 10-QSB or
hereafter included in other publicly available documents filed with the
Securities and Exchange Commission, reports to the Company's stockholders and
other publicly available statements issued or released by the Company involve
known and unknown risks, uncertainties, and other factors which could cause the
Company's actual results, performance (financial or operating) or achievements
to differ from the future results, performance (financial or operating) or
achievements expressed or implied by such forward looking statements. Such
future results are based upon management's best estimates based upon current
conditions and the most recent results of operations.
Overview
The Company designs, assembles, manufactures and distributes electric
bicycle power kits, electric bicycles and tricycles, and other low-power
electric transportation vehicles. Historically, unit sales have been
approximately 50% kits, 30% electric bicycles, and 20% electric scooters. Dollar
sales have been 30% kits, 35% electric bicycles, and 35% electric scooters.
The Company manufactures several electric motor kits. The Company was
issued its first United States Patent on February 13, 1996 on its electric motor
power system for bicycles, tricycles, and scooters (Patent #5,491,390). On
September 30, 1997, the Company was issued its second United States Patent on
its electric motor system (Patent #5,671,821). On December 15, 1998, the Company
was issued a United States Patent for its ZAPPY scooter (Patent #5,848,660). ZAP
also holds several trademarks. The "ZAP" trademark was registered on September
28, 1993 under registration no. 1,794,866, the ELECTRICRUIZER mark was
registered on April 2, 1999 under registration no. 2,248,753, and the POWERBIKE
mark was registered on June 1, 1999 under registration no. 2,248,753. The
electric motor kit manufacturing and installation of the motor systems to the
bicycles and scooters is done at its Sebastopol location. The electric motors
are purchased from an original equipment manufacturer (OEM) in the auto and
air-conditioning industry. The Company is using one company for its motors,
although there are other companies that could be used with slight modifications
to the motor support brackets. The batteries are standard batteries used in the
computer industry for power interrupt systems. The electronic system uses
standard electronic components. The Company has a contractual relationship with
Smith &
7
<PAGE>
Wesson who provides the Company with Law Enforcement Bicycles. The Company has
agreed to purchase at least 250 bikes from Smith & Wesson during 1999 in
exchange for specific exclusive distribution and pricing rights. The Company has
no other contractual agreements with any of its other vendors.
On July 19, 1999, the Company created two subsidiaries, ZAPWORLD
Stores, Inc. and ZAPWORLD Outlets, Inc. ZAPWORLD Stores, Inc. was set up to
record the activity for acquired stores while ZAPWORLD Outlets was set up to
record the activity for future franchise stores. Both subsidiaries are wholly
owned by ZAPWORLD.COM.
At the Board of Directors meeting dated September 9, 1999, the Board of
Directors selected Gary Starr to be the Chief Executive Officer of the Company.
On July 12, 1999, the Company entered into an agreement to acquire
American Scooter and Rentals, Inc located in San Francisco, CA. The purchase
price for the business and lease/purchase of the equipment consists of 21,001
shares of the Company's Common Stock and $70,000 in cash. The 21,001 shares were
issued prior to September 30,1999 and have been recorded as an advance. The
purchase was completed on November 05, 1999. The Company has consolidated all
revenues and expenses incurred by the business since the acquisition date and
has included the cash, inventory, and fixed assets acquired since the agreement
in its consolidated balance sheet.
On September 17, 1999, the Company entered into an agreement to
purchase the business and all the assets and liabilities of Big Boy Bicycles in
Key West, FL. The purchase price for the business and all its assets consisted
of 1,000 shares of the Company's Common stock and $15,165 in cash. The Company
also assumed approximately $67,636 of Big Boy Bicycles debt obligations as of
the closing date, November 12, 1999.
The Company as of September 30, 1999 had a $450,000 sales backlog.
The Company's growth strategy is to increase net sales by augmenting its
marketing and sales force, by increasing distribution channels through retail
organizations and wholesale distributors both domestically and overseas, by
setting up and acquiring additional outlet stores under its subsidiary
corporation as well as franchise stores to assist in the retail arena. The
Company will continue to increase its production capability to meet the
increasing demand for its product. The Company will continue to develop the
product with the goal of being the low cost leader in the industry. The Company
will continue to develop new products with the goal of offering the consumer the
most complete line of electric vehicles available. Product improvements,
strategic relations, the development of the ZAP Electric Vehicle Outlet network,
and ZAP's Shopping Mall on the Internet are continuing to enlarge ZAP's presence
and brand awareness in the electric vehicle industry.
Results of Operations
<TABLE>
The following table sets forth, as a percentage of net sales, certain
items included in the Company's Income Statements (see interim condensed
consolidated Financial Statements and Notes) for the periods indicated:
<CAPTION>
Quarter ended September 30, Nine months ended September 30,
1999 1998 1999 1998
----- ----- ----- -----
<S> <C> <C> <C> <C>
Statements of Income Data:
Net sales........................................ 100.0% 100.0% 100.0% 100.0%
Cost of sales.................................... 78.0 63.3 67.0 66.0
Gross profit..................................... 22.0 36.7 33.0 34.0
Operating expenses.............................. 41.1 43.3 40.8 55.0
Gain/(Loss) from operations...................... (19.1) (6.6) 7.8 (20.9)
Other income (expense).......................... 0.8 (0.8) (1.0) (0.6)
Loss before income taxes......................... (18.3) (7.4) (8.8) (21.5)
Provision for income taxes....................... 0.0 0.0 0.0 0.0
Net loss......................................... (18.3) (7.4) (8.8) (21.5)
</TABLE>
8
<PAGE>
Net sales for the quarter ended September 30, 1999, were $1,767,000
compared to $1,229,700 in the prior year, an increase of $537,300 or 44%. The
increase in sales in 1999 over the same period in 1998 was due to the sales of
the ZAPPY scooter that accounted for $1,151,200 or 65% of total sales and sales
recognized from the newly acquired outlet stores that accounted for $169,300 of
sales. During the third quarter of 1999, $470,000 in sales representing 27% of
total net sales were with one customer.
Gross profit decreased as a percentage of net sales to 22% from 37%. The
total gross profit decreased $63,400 or 14%. The decrease in profit dollars and
percentage is largely due to a one-time sale to a large distributor at a
significant discount in the third quarter of 1999. Additional costs were
incurred in moving and scaling up operations.
Selling expenses in the quarter ended September 30, 1999 were $280,400 as
compared to $255,600 for the quarter ended September 30, 1998. This was an
increase of $24,800 or 10% from 1998 to 1999. As a percentage of sales, selling
expenses decreased from 21% of sales to 16% of sales. The increase in selling
expenses is consistent with the Company's plan to increase sales volume.
General and administrative expenses for the quarter ended September 30,
1999 were $363,500. This was an increase of 137,900 or 61% from 1998. As a
percentage of sales, general and administrative expense increased to 21% from
18% of net sales. Expense increases during the 3rd quarter of 1999 as compared
to the 3rd quarter of 1998 resulted from increased personnel costs of $117,200
due to the needs of the new outlet stores and increased requirements for the
parent company.
Research and development increased $30,100 or 58% from the 3rd quarter of
1998 as compared to the 3rd quarter of 1999. As a percentage of net sales it
increased to 5% of sales in the 3rd quarter of 1999 as compared to 4% of sales
in the 3rd quarter of 1998. New product development and improvements to existing
products resulted in the increase of dollars.
Nine Months Ended September 30, 1999 Compared to Nine Months Ending September
30, 1998
Net sales for the nine months ended September 30, 1999 were $4,444,200
compared with $2,554,600 in the nine months ended September 30, 1998, an
increase of $1,889,600 or 74%. The increase in sales is attributed to sales of
the new ZAPPY scooter and a greater acceptance of the Company's products in the
marketplace. ZAPPY scooters accounted for $2,847,000 or 64% of sales in the
first nine months of 1999. During the nine months of 1999, $471,700 in sales
representing 11% of total sales were with one customer.
Gross profit decreased as a percentage of net sales, to 33% from 34%. The
total gross profit increased $596,100 or 69%. The increase in gross margin
dollars can be attributed to the gross margins realized on the sales of the new
ZAPPY scooters.
Selling expenses for the nine months ended September 30, 1999 were $729,500
as compared to $665,400 for the nine months ended September 30, 1998. This was
an increase of $64,100 or 10% from 1998 to 1999. As a percentage of sales,
selling expenses decreased from 26% of sales to 16% of sales. The increase in
selling expenses is consistent with the Company's plan to increase sales volume.
General and administrative expenses for the nine months ended September 30,
1999 were $877,800. This is an increase of $269,800 or 44% from 1998. As a
percentage of sales, general and administrative expense decreased to 20% from
24% of net sales. Expense increases during the first nine months of 1999 as
compared to the first nine months of 1998 occurred due to the need for
managerial infrastructure related to acquisition activities.
Research and development increased $73,400 or 56% from the first nine
months of 1998 as compared to the first nine months of 1999. As a percentage of
net sales, research and development remained flat at 5% of sales for the first
nine months of 1999 as compared to the first nine months of 1998. New product
development and improvements to existing products resulted in the increase of
dollars.
9
<PAGE>
Liquidity and Capital Resources
The Company used cash from operations of $732,600 and $1,099,500 during the
nine months ended September 30, 1999 and 1998 respectively. Cash used in
operations in the first nine months of 1999 was the result of the net loss
incurred for the period of $390,900, offset by net non-cash expenses of
$883,800, and the net change in operating assets and liabilities resulting in a
further use of cash of $1,225,500. Cash used in operations for the first nine
months of 1998 was the result of the net loss incurred for the first nine months
of $550,500, offset by net non cash expenses of $61,200, and the net change in
operating assets and liabilities resulting in further use of cash of $610,200.
Investing activities used cash of $304,000 and $80,100 during the first
nine months ended September 30, 1999 and 1998 respectively. The uses of cash
were for the purchase of fixed assets, defense of the company's patents and the
Company's investments in technology companies.
Financing activities provided cash of $2,902,500 and $1,045,500 during the
first nine months ended September 30, 1999 and 1998 respectively. In 1999, the
cash provided by financing activities included the proceeds from loans payable
of $27,000, increases in leases payable of $21,500, the sales of common stock
(net of offering costs) totaling $3,750,200 offset by principal payments on
outstanding debt. In 1998, the cash provided by financing activities included an
increase in loans payable of $517,500 and the sales of common stock, $558,000
offset by principal payments on outstanding debt.
At September 30, 1999, the Company had cash and cash equivalents of
$2,341,200 as compared to $556,400 at September 30, 1998. At September 30, 1999,
the Company had working capital of $3,970,200 as compared to working capital of
$708,300 at September 30, 1998. The increase in both cash and working capital in
the first nine months of 1999 over the first nine months of 1998 are primarily
due to the net proceeds received from the Company's private placement offering
which more than offset the Company's net losses during the same period. The
Company, at present, does not have a credit facility in place with a bank or
other financial institution. The Company has established an accounts receivable
facility that is guaranteed by the U.S. Exim Bank. The Company believes that the
cash on hand at September 30, 1999, will be sufficient to allow the Company to
continue its expected level of operations for the remainder of the year.
The Company's primary capital needs are to fund its growth strategy,
which includes increasing its internet shopping mall presence, increasing
distribution channels, strengthening company owned and establishing franchised
ZAP stores, introducing new products, improving existing product lines and
developing of strong corporate infrastructure
10
<PAGE>
Year 2000 Readiness
State of Readiness. During the past three fiscal years, the Company has
been actively involved in finding and correcting the Year 2000 problems within
its information technology structure. The information system correction process
is essentially complete. The Company maintains its critical information
technology systems in close cooperation with its suppliers. The Company is not
currently operating any legacy systems that are no longer being supported by the
original supplier.
Costs. The Company has had only limited expenditures related to Year
2000 issues, consisting principally of personnel costs incurred in the scope of
normal operations. In addition, software replacements and upgrades in the
ordinary course of business have enhanced the Company's Year 2000 readiness
without incremental costs. The Company is in the final stages of its projects
and does not anticipate that future Year 2000 costs related to information
technology operations will be significantly beyond the scope of normal
operations.
Risks. In the early weeks of 2000, the Company may experience some
random supply chain disruptions that may affect its ability to produce and
distribute key products. These disruptions will be material if the United States
experiences significant interruptions in basic services, such as the electric
power grid, natural gas, telephone service or the banking systems.
Completion. Based on management's assessment of current progress, the
Company believes it will complete the limited amount of Year 2000 modifications
and contingency plans that remain before the end of 1999. The Company is in
close contact with its key hardware and software suppliers, and will implement
any future updates shortly after they are released. The Company can give no
assurance that the Company's Year 2000 preparations will prevent disruptions in
its business resulting from Year 2000 problems of the Company, its suppliers or
its customers, or that costs to the Company of its preparations or any
disruptions will not be material.
Seasonality and Quarterly Results
The Company's business is subject to seasonal influences. Sales volumes in
the bicycle industry typically slow down during the winter months, November to
March, in the U.S.
Inflation
The Company's raw materials are sourced from stable cost competitive
industries. As such, the Company does not foresee any material inflationary
trends for its raw material sources.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
There were no material proceedings pending in which the Registrant was
named as a party.
Item 4. Submission of Matters to a Vote of Security Holders
On May 16, 1999 a Board Meeting resolved to authorize a new employee
incentive and consultant plan of 500,000 shares. This action was brought
before the annual meeting on May 16, 1999. It was voted on and adopted by
the shareholders.
Item 6. Exhibits and Reports on Form 8-K
On July 12, 1999, a Form 8-K was filed amending the name of the
Corporation to be ZAPWORLD.COM.
11
<PAGE>
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.
ZAPWORLD.COM
- - ----------------------------------
(Registrant)
Date
----------------- ----------------------------------------
Gary Starr - CEO & CFO
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF ZAPWORLD.COM AND ITS SUBSIDIARIES
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999, AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JUN-30-1999
<PERIOD-END> SEP-30-1999
<CASH> 2,341,200
<SECURITIES> 0
<RECEIVABLES> 807,800
<ALLOWANCES> (35,000)
<INVENTORY> 1,286,400
<CURRENT-ASSETS> 4,843,200
<PP&E> 532,800
<DEPRECIATION> (267,700)
<TOTAL-ASSETS> 5,568,900
<CURRENT-LIABILITIES> 873,000
<BONDS> 3,700
0
0
<COMMON> 8,372,000
<OTHER-SE> (3,737,700)
<TOTAL-LIABILITY-AND-EQUITY> 5,568,900
<SALES> 4,444,200
<TOTAL-REVENUES> 4,485,600
<CGS> 2,978,400
<TOTAL-COSTS> 1,812,100
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (35,000)
<INTEREST-EXPENSE> 77,400
<INCOME-PRETAX> (390,100)
<INCOME-TAX> 800
<INCOME-CONTINUING> (390,900)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (390,900)
<EPS-BASIC> (0.11)
<EPS-DILUTED> (0.11)
</TABLE>
