UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB/A
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
- SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended March 31, 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: 001-14889
HOME.WEB, INC.
--------------
(exact name of registrant as specified in its charter)
NEVADA 77-0454933
- ------ ----------
(State or other (IRS Employer
jurisdiction of Identification No.)
incorporation or
organization)
380 Foam Street, Suite 210, Monterey, California 93940
- ------------------------------------------------ -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (831) 375-6209
--------------
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 for the
past 90 days. Yes X No
- --
The number of shares of the Registrant's Common Stock, $0.001 par value, as of
March 31st, 1999: 27,147,000.
----------
<PAGE>
HOME.WEB, INC.
FORM 10-QSB, QUARTER ENDED March 31, 1999
INDEX
PART I FINANCIAL INFORMATION
----------------------------
ITEM 1 FINANCIAL STATEMENTS
Accountant's Review Report F-2
Balance Sheet, March 31, 1999 F-3
Statement of Operations, Three months
Ending March 31, 1999 F-4
Statement of Retained Earnings
March 31, 1999 F-5
Statement of Cash Flows,
March 31, 1999 F-6
Summary of Significant Accounting Policies F-7
Notes to Financial Statements F-8
Item 2 Management's Discussion and Analysis or Plan of Operations
PART II OTHER INFORMATION
Item 1 Legal Proceedings . .. . . . . . . . . . . . . . . . . . . . . . . 12
Item 2 Changes in Securities . . . . . . . . . . . . .. . . . . . . . . . 12
Item 3 Defaults Upon Senior Securities . . . . . . . . . .. . . . . . . . 12
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
Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . .13
<PAGE>
HOME WEB, INCORPORATED
----------------------
(A Development Stage Company)
Index to Financial Statements
Page
Accountant's Review Report 2
Balance Sheet, March 31, 1999 3
Statement of Operations, Three months
Ending March 31, 1999 4
Statement of Shareholders' Equity
March 31, 1999 5
Statement of Cash Flows,
March 31, 1999 6
Summary of Significant Accounting Policies 7-8
Notes to Financial Statements 9-11
<PAGE>
HAWKINS ACCOUNTING
CERTIFIED PUBLIC ACCOUNTANT 341 MAIN STREET SALINAS CA 93901
(831) 758-1694 FAX (831) 758-1699
To the Board of Directors and Shareholders
Home Web, Incorporated
Monterey, California
I have reviewed the accompanying balance sheet of Home Web, Incorporated as of
March 31, 1999, and the related statements of income and retained earnings and
cash flows for the three months then ended March 31, 1999 and March 31, 1998, in
accordance with Statements on Standards for Accounting and review Services
issued by the American Institute of Certified Public Accountants. All
information included in these financial statements is the representation of the
management of Home Web, Incorporated.
A review consists principally of inquiries of Company personnel and analytical
procedures applied to financial data. It is substantially less in scope than an
audit in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, I do not express such an opinion.
Accumulated deficit during the development stage of through the three months
ended March 31, 1999 is $1,279,567 and cash flows of $82.
Based on my review, I am not aware of any material modifications that should be
made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note H to the financial
statements, the Company has incurred net losses since inception, which raises
substantial doub about its ability to continue as a going concern. The financial
statements do not include any adjustment that might result from the outcome of
this uncertainty.
/s/ Hawkins Accounting
Reissued July 8, 1999
April 1, 1999
<PAGE>
HOME WEB, INCORPORATED
----------------------
(A Development Stage Company)
BALANCE SHEET
March 31, 1999
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Current Assets
Cash in bank-First National $ 82
Accounts receivable 1,450
-----
Total Current Assets 1,532
Equipment
Coolers and equipment 40,308
Office equipment 9,841
-----
50,149
Accumulated depreciation (6,606)
------
Total Equipment 43,543
Other assets
Trade name 11,000
------
Total Other Assets 11,000
TOTAL ASSETS $ 56,075
======
LIABILITIES AND CAPITAL
Current liabilities
Accounts payable 13,442
Loand from affiliate 100
California Franchise Tax 1,600
---
Total Current Liabilities 15,142
TOTAL LIABILITIES 15,142
Common stock 27,157
Paid in capital 1,293,343
Deficit accumulated during development stage (1,279,567)
----------
TOTAL CAPITAL 40,933
TOTAL LIABILITIES AND CAPITAL $ 56,075
===========
</TABLE>
See accompanying notes and accountant's report
3
<PAGE>
HOME WEB, INCORPORATED
----------------------
(A Development Stage Company)
STATEMENT OF OPERATIONS
For the three months ending March 31, 1999 and 1998
<TABLE>
<CAPTION>
Deficit
Accumulated
During
Development
1999 1998 Stage
---- ---- -----
<S> <C> <C> <C>
Revenue
Sales $ 528 $ 1,100 18,887
Cost of sales 523 1,046 15,091
--- ----- ------
Gross margin 5 54 3,796
Expenses
Advertising 143 849
Amortization 492 1,684
Consulting fees 1,000 13,000 6,696
Equipment rental 1,311 2,339
Depreciation 1,321 1,248 6,806
License and taxes 140 225
Meals and entertainment 302 848
Office help 6,005 10,841
Office Supplies 120 1,638 3,292
Postage 379 673
Travel 30 1,777
Rent 2,100
Business start up costs 26,356
Compensation due stock issuance 1,200,000
Telephone and utilities 748 1,243
Development stage expense 12,952 12,952
Organization costs 2,366 2,366
----- ------ -----
Total expenses 17,759 25,436 1,280,747
------ ------ ---------
(Loss) from operations (17,754) (25,382) (1,276,951)
Other income (expense)
Interest (50) (50)
Nondeductible penalties (166)
State tax expense (800) (800) (2,400)
---- ---- ------
Total other expenses (800) (850) (2,616)
---- ---- ------
Net loss $ (18,554) $ (26,232) $ 1,279,567
============= ============ ===========
Loss per share
of common stock $ (0.0007) $ (0.0010) $ (0.0471)
============= ============= ==========
Weighted average of
shares outstanding 27,157,000 25,510,834 27,157,000
========== ========== ==========
</TABLE>
See accompanying notes and accountant's report
4
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
STATEMENT OF SHAREHOLDERS' EQUITY
March 31, 1999
<TABLE>
<CAPTION>
Accumulated
Deficit
Common Stock Paid in Development
Shares Amount Capital Stage Total
------ ------ ------- ----- -----
<S> <C> <C> <C> <C> <C>
Balance,
December 31, 1998 27,147,000 $ 27,147 1,292,853 $ (1,261,013) $ 58,987
Options exercised 0 0
Common stock issued 10,000 10 490 500
Net loss for the
period ended
December 31, 1998 (18,554) (18,554)
---------- --------- --------- ------- -------
27,157,000 $ 27,157 1,293,343 $ (1,279,567) $ 40,933
========== ========= ========= ============= =========
</TABLE>
See accompanying notes and accountant's report
5
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
STATEMENT OF CASH FLOWS - INDIRECT METHOD
For the three months ending March 31, 1999 and 1998
<TABLE>
<CAPTION>
March 31, 1999
Deficit
Accumulated
During
Development
1999 1998 Stage
---- ---- -----
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (15,630) $ (26,232) $ (76,701)
Adjustment to reconcile net income to net cash
provided by operating activities
Depreciation 1,321 1,740 8,190
Increase in accounts receivable (66) (1,450)
Increase in current liabilities 14,352 4,650 15,152
NET CASH PROVIDED BY OPERATING ACTIVITIES (15) (20,008) (54,809)
INVESTING ACTIVITIES
Increase in other assets 14,960
Purchase of property, plant and equipment 28,459 50,149
NET CASH USED IN INVESTING ACTIVITIES 28,459 65,109
FINANCING ACTIVITIES
Sale of common stock 49,300 120,000
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (15) 833 82
Cash and cash equivalents at the beginning
of the period 97 267 0
CASH AND CASH EOUIVALENTS AT THE END OF THE PERIOD $ 82 $ 1,100 $ 82
Supplemental schedule of noncash operating
and financing activities
The Company issued 10,000 shares of
common stock with a par value of $.001
and a market value of $.05 for legal
fees. Total expense $500 The Company
expensed in the current year in accordance
with SOP 198-05 organization costs with
a net book value of $ 2,366.
</TABLE>
See accompanying notes and accountant's report
6
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
Summary of Significant Accounting Policies
March 31, 1999
Development Stage Company
- -------------------------
Home Web, Inc. (the "Company") is a development stage company, as defined
in the Financial Accounting Standards Board No. 7, The Company is devoting
substantially all of its present efforts in securing and establishing a new
business, and although planned principal operations have commenced,
substantial revenues have yet to be realized.
Use of estimates
- ----------------
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from these estimates.
Cash equivalents
- ----------------
For the purpose of the statement of cash flows, the company considers all
highly liquid debt instruments purchased with the original maturity of
three months or less to be cash equivalents.
Organization and Business Start Up and Amortization
- ---------------------------------------------------
Organization costs were expensed during the period ending March 31, 1999 in
accordance with SOP 98-5. Management made the election to expense the costs
for years beginning January 1, 1999.
Income Taxes
- ------------
Income taxes are provided for the tax effects of transactions reported in
the financial statements and consist of taxes currently due plus deferred
taxes related pristarily to differences between the recorded book basis and
tax basis of assets and liabilities for financial and income tax reporting.
The deferred tax assets and liabilities represent the future tax return
consequences of those differences, which will either be taxable or
deductible when the assets and liabilities are recovered or settle.
Deferred taxes are also recognized for operating losses that are available
to offset future taxable income and tax credits that are available to
offset future federal income taxes.
Common Stock
- ------------
Common stock is at $.001 par value with 50,000,000 shares authorized,
27,157,000 outstanding as of March 31, 1999.
7
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
Summary of Significant Accounting Policies (Con't)
March 31, 1999
Stock options
- -------------
Stock that is issued in exchange for services rendered to the Company, is
recorded at the fair value of the stock in the year that the stock is
issued and recorded as an expense in the same year.
Material Adjustments
- --------------------
Management represents that all material adjustments to the financial
statements have been made.
8
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
Notes to Financial Statements
March 31, 1999
Note A: Backgound
- -----------------
The Company was incorporated under the laws of the State of Nevada on
September 15, 1995. The principal activities of the Company, from the
beginning of the development stage, have been organizational matters and
the sale of stock. The Company was formed to sell wholesale gourmet and
specialty cheese on the Internet. During the period ending March 31, 1999
the Company had sales and incurred expenses against those sales, but the
activity was immaterial for the purposes of SFAS No. 7.
Note B: Related Party Transactions
- ----------------------------------
There were no material related party transactions for the three month
period ending March 31, 1999.
For the three month period ending March 31, 1999 the Company paid to
Monterey Ventures a total of $7,210 for overhead expenses such as office
help and computer equipment. Monterey Ventures has a management contract
with the Company and is a shareholder in the Company.
During the period of March 31, 1999 the Company paid one of its founders
$500 for consulting services to the Company.
Note C: Income taxes
- --------------------
The benefit for income taxes from operations consisted of the following
components: curront tax benefit of $2,783 for March 31, 1999 and $3,935 as
of March 31, 1998 resulting from a net loss before income taxes, and
deferred tax expenses of $2,783 and $3,935 respectively resulting from a
valuation allowance recorded against the deferred tax asset resulting from
net operating losses. Net operating loss carryforward will expire in 2013.
The valuation allowance will be evaluated at the end of each year,
considering positive and negative evidence about whether the asset will be
realized. At the time, the allowance will either be increased or reduced;
reduction would result in the complete elimination of the allowance if
positive evidence indicates that the value of the deferred tax asset is no
longer required.
9
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
Notes to Financial Statements
March 31, 1999
NOTE C: Public stock offering
- -----------------------------
During the periods ending March 31, 1999 and 1998, pursuant to an exemption
under Rule 504 of Regulation D of the Securities Act of 1933, as amended
(the Act), the Company sold solely to accredited and/or sophisticated
investors, its common stock. The only transaction during the period of
March 31, 1999 was 10,000 shares of stock issued to the corporate counsel
in exchange for legal services to the corporation.
During the period of March 31, 1998 there were various transactions to
fifteen different accredited and/or sophisticated investor. Total proceeds
from these transactions were $ 49,300.
Note D: Stock options
- ---------------------
It was also voted upon at the organizational meeting during 1997 to grant
options to officers of the corporation and MVI, an affiliated company along
with one of the employees of MVI. The options can be exercised by MVI at
$.01 and $.001 for the officers and the employee. The options to be
exercised are 1,250,000 and have an expiration date of December 31, 1999.
These options are not compensatory and do not represent services rendered.
Therefore, no provision has been made to account for these options until
exercised by the parties.
During the period ended March 31, 1998 MVI exercised its stock options as
did one of the founders and a key employee of MVI. Two of the remaining
founders did not exercise their options during the year. These options
total 350,000 shares. These options are treated as non-compensatory options
and will be accounted for when the options will be exercised.
There were no options exercised during the three-month period ending March
31, 1999.
Note E: Property, equipment and depreciation
- --------------------------------------------
Property and equipment are recorded at cost. Maintenance and repairs are
expensed as incurred; major renewals and betterments are capitalized. When
items of property and equipment are sold or retired, the related costs and
accumulated depreciation are removed from the accounts and any gain or loss
is included in income.
Depreciation expense for the period ending March 31, 1999 and 1998 was
$1,321 and $1,428 respectively,
10
<PAGE>
HOME WEB, INCORPORATED
----------------------
( A Development Stage Company)
Notes to Financial Statements
March 31, 1999
NOTE F: Major customer
- ----------------------
The Company had a purchase commitment to purchase the Company's merchandise
from a non-affiliated company. This customer is also to take physical
possession of the Company's major assets and use those assets in the
ordinary course of its business. Terms are discussed more fully in Note G.
NOTE G: Going concern
- ---------------------
As of March 31, 1999, the Company had net losses from operating activities
which raise substantial doubt about its ability to continue as a going
concern.
The Company has obtained a commitment for up to $ 150,000 from a
significant shareholder, Monterey Ventures, Inc for funding over the next
twelve months. The funds would be paid distributed in increments per
requests from the Company on an "as needed" basis. Under the agreement, the
Company can repay the borrowed funds in increments as the Company receives
payment from its customers. Also in the credit agreement is any funds
needed for longer than twelve months would be considered long term debt.
This type of funding, if needed, would be structured for a twenty-four or
thirty-six month payoff not to exceed $25,000 in requests in the first year
of operations.
The Company has signed an agreement with Internet Food Company to purchase
its products. Internet Food Company has already penetrated the hotel and
gift basket market and has further developed a web site to market its
goods. The two companies are in the process of identifying specific
products that Home Web. Inc. would supply wholesale.
The Company's ability to continue as a going concern is dependent upon a
successful public offering and ultimately achieving profitable operations.
There is no assurance that the Company wdl be successful in its efforts to
raise additional proceeds or achieve profitable operations. The financial
statements do not include any adjustments that might result from the
outcome of this uncertainty.
11
<PAGE>
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 would, 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 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 the Company's periodic reports on Forms 10-K, 10Q and 8-K
filed with the Securities and Exchange Commission.
Overview
- --------
Home Web plans to penetrate the gourmet/specialty foods market and to
maximize sales by wholesaling products to gourmet food stores, small grocery
chain stores and hotels. The product is currently sold through California
Season's company-owned retail stores, catalog and direct mail order, as well as
business and corporate sales programs.
The gourmet and specialty food industry has a history of growth. The
national revenue for the gourmet and specialty food industry exceeded
thirty-three billion dollars in 1996, according to a report published in the
November 1996 issue of Gourmet Foods Magazine, published by the National
Association of Specialty Foods Trade, Inc., and based upon information obtained
from "Pak Facts," a New York resource company. Home Web is taking advantage of
this market by wholesaling and distributing varieties of handmade Monterey Jack
Cheese.
<PAGE>
The Company selected Monterey, California as its location because it was
the original home of Monterey Jack cheese. David Jacks of Monterey first
produced and marketed Monterey Jack cheese in 1882. This cheese is the only
native California cheese and one of only two cheeses native to the United
States. The Monterey Cheese Company is the only company offering handmade
Monterey Jack cheese made in Monterey, California.
The Company outsources the production of its cheese products to Sonoma
Cheese Factory ("Sonoma"). Sonoma is one of the oldest hand-rolled cheese
processing plants in California and is one of only two such plants still in
existence. Due to the quality of the cheeses produced by Sonoma and the fact
that it is difficult to duplicate hand-rolled cheeses, the Company will continue
to outsource its products for the foreseeable future. There is no written
agreement between Sonoma and the Company; instead, the Company purchases the
product from Sonoma on a cash-on-delivery basis. Sonoma ships the cheese without
labels, which the Company puts on upon delivery. If Sonoma is unable to satisfy
the Company's supply requirements, a back-up supply source is available. This is
a manufacturing wholesale, retail cheese company in Sonoma doing business as
Sonoma Foods, Inc.
From May 1997, the Company has been a development stage company
specializing in a variety of hand-made Monterey Jack cheeses. The Company
selected the product line and the method of marketing to use and made many basic
decisions regarding the amount of products to be offered, the colors of the
packaging and other details. Test marketing has also been done on a limited
basis. The Company is satisfied with its test market results on the cheese
products and will now be expanding sales efforts. The Company will also proceed
with a plan to expand its wholesale line, as outlined below, and is seeking
candidates for manufacturing, distribution and promotion of its products. No
retail activities will be entered into by the Company; rather, Home Web will
continue to source products and sell them wholesale.
By the end of fiscal 1999, the Company plans to have successfully
introduced two new product lines and labels to the gourmet food market. The
Company feels it is the proper time to bring new gourmet "niche" food products,
because the cheese line is now fully developed and ready for marketing. Carmel
Valley Farms and Salinas Valley Farms will be the two new gourmet food lines and
labels. Carmel Valley will feature wine jellies and jams and Salinas Valley will
feature artichoke products, salsa, spices, hot sauce and pasta sauce. The
marketing will be directed towards companies located in tourist areas or which
sell to tourists through local outlets. The Company will also private label
items as requested by its customers. The Company's management anticipates that
wine jellies will do exceptionally well in wineries that have gift shops. The
Company expects to have at least some of these new products available by
September 30, 1999. This will allow the Company to participate in the Food and
Beverage Show in San Francisco, California, in November 1999 and to be prepared
for the holiday food ordering season in October and November.
The Company signed a Purchasing Agreement with Internet Food Company, Inc.
("Internet Food Company") on May 6, 1999. According to the terms of this
agreement, the Company will sell a variety of cheeses and gourmet food products
to Internet Food Company and will advertise on its web site. Home Web will also
develop special private label products for Internet Food Company.
<PAGE>
There are no minimum purchase requirements in this contract and no
guarantees that any products will be purchased.
Product
- -------
Home Web, under the label "Monterey Jack Cheese," currently offers twelve
varieties of creamy, handmade cheeses in three pound wheels, one pound wheels,
nine ounce wedges and three ounce wedges. The varieties of cheese include
hand-rolled, original Monterey Jack, Dry Jack, Caraway, Pesto, Hot Pepper Jack,
Habanero Jack, Garlic Jack, Lite Jack, Cheddar, Chili Cheddar, Vidalia Onion
Jack and Teleme.
The Company's own research has shown that there is a niche demand for its
products because the cheeses are from Monterey and are of handmade quality. The
cheeses have been market-tested by the Company indicating consumer acceptance.
Current vendors offering these cheeses to the public include the California
Seasons chain of three retail stores, the California Seasons' catalog, several
luxury hotels in the Monterey and Big Sur area, a number of Monterey convention
groups, a distributor in Idaho, a chain of five upscale gourmet food markets in
the Los Angeles area, the Monterey Peninsula Airport Gift Shop, a Carmel Valley,
California store and several more retail stores.
Results of Operations
- ---------------------
The Company had revenues of $528 for the three-month period ending March
31, 1999 compared to $0 for the three-month period ending March 31, 1998. To
date, the Company has not relied on any revenues for funding its activities and
it does not expect to receive significant revenues from operation in the
immediate future.
For the three-month period ending March 31,1999, the Company's general and
administrative expenses increased to $17,759 compared to $0 for the
corresponding period in 1998. The 1999 amount increase is due to the
commencement of operations.
The Company's net loss was $18,554, for the first quarter of 1999 compared
to a net loss of $0 for the corresponding period in 1998. This increase was
primarily due to the commencement of operations.
Liquidity and Capital Resources
- -------------------------------
As of March 31, 1999, the Company's cash balance was $82, compared to $0 as
of March 31, 1998.
The Company's future funding requirements will depend on numerous factors.
These factors include the Company's ability to sell sufficient quantities of its
products to become profitable and the Company's ability to compete against other
better capitalized corporations who offer alternative or similar products.
<PAGE>
Due to the "start up" nature of the Company's business, the Company expects
to incur losses as it expands its business. While the Company has enough cash to
fund its early stage expansion plans, the Company may choose to raise additional
funds through private or public equity investment in order to expand the range
and scope of its business operations. Even if the Company does not have an
immediate need for additional cash, it may seek access to the public equity
markets if and when conditions are favorable. There is no assurance that such
additional funds will be available for the Company to finance its operations on
acceptable terms, if at all.
In order to implement the strategic plan and meet the Company's anticipated
working capital needs, the Company estimates that it will require $150,000 in
capital ($125,000 for short-term financing and $25,000 for Salinas Valley and
Carmel Valley product development). The short-term financing would include
accounts receivable. The Company has a commitment for funding from Monterey
Ventures, Inc. ("MVI") for up to $150,000 to implement the Company's current
plans. MVI will supply short-term and long-term capital financing, which would
be for product development expenses. These funds will be distributed in
increments per requests from Home.Web, Inc. to Monterey Ventures, Inc. on an "as
needed" basis. This agreement to fund has been added as an exhibit. The funds
will be used for purchasing product on COD shipments, such as a large order of
cheese, or prepaying if the product is drop shipped to the customer. It is
anticipated that revenues will be generated during the holiday season in October
and November of 1999 and the requirements for funds from Monterey Ventures, Inc.
will be minimal. Under the agreement with Monterey Ventures, Inc., the Company
can repay the borrowed funds as payment is received from customers. This
accommodation is a short term line of credit. This type of funding, if needed,
could be structured for a payoff not to exceed $25,000 in requests in the first
year of operations and would be used for equipment or product purchases or
research and development. The Company will only be charged interest on any funds
used at commercially competitive rates. Because the products are outsourced, the
need for capital will be modest. The general cost would be in the graphic design
for labeling and financing accounts receivable. Any additional expenses, such as
legal and accounting costs, will be paid through this credit accommodation until
the Company's revenues are able to cover these expenses.
Home Web does not plan to conduct any offering of securities until it has
established its sales history. The only circumstances under which the Company
may conduct an offering sooner is if an opportunity arises to expand the Company
by acquiring a business with established product sales and distribution.
Additional potential sources of funds if the Company requires additional income
include factor agreements, lease agreements for equipment, to reduce costs and
private financing from major shareholders.
<PAGE>
PART II -- OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS
None
ITEM 2 CHANGES IN SECURITIES
None
ITEM 3 DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 6 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.
HOME.WEB, INC.
/S/ Dennis Davis
-------------------------
Dennis Davis
President
Dated: May 17, 1999
<PAGE>
HAWKINS ACCOUNTING
CERTIFIED PUBLIC ACCOUNTANT 341 MAIN STREET SALINAS CA 93901
(831) 759-1694 FAX (831) 759-1699
July 8, 1999
CONSENT OF INDEPENDENT AUDITOR
------------------------------
As the independent auditor for Home.Web, Incorporated, I hereby consent to the
incorporation by reference in this Form 10SB Statement and any amendments
thereto of my report, relating to the financial statements and financial
statement schedules of Home.Web, Incorporated for the years ended December 31,
1998 and 1997 included on Form 10SB and amendments. Reporst are dated January
13, 1999 for the year ended December 31, 1998 and February 5, 1999, both reports
were reissued July 8, 1999.
I further consent to the incorporation of my review report and financial
statements by reference in the Form 10-QSB and amendments thereto. These
statements cover the period for March 31, 1999 and 1998. Report date of April 1,
199 and reissued July 8, 1999.
/s/ Hawkins Accounting
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
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