UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSBA
Amendment No. 1
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000
OR
[ ] 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: 0-24977
MIZAR ENERGY COMPANY
--------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Colorado 33-0231238
------------------------- -----------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
2400 E. Commercial Blvd., Suite 221
Ft. Lauderdale, FL 33308
--------------------------------------
(Address of principal executive offices, including zip code)
(954) 938-8010
--------------
(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
requirements for the past 90 days.
YES [X] NO [ ]
The number of issued and outstanding shares of the Registrant's Common Stock,
$0.001 par value, as of June 30, 2000 was 10,050,000.
<PAGE>
EXPLANATORY NOTE
We are filing this amendment to amend our quarterly report on Form
10-QSB for the six months ended June 30, 2000 to correct certain typographical
errors contained in our financial statements, which relate to the shareholder's
equity section of our balance sheet dated June 30, 2000.
Item 1 of Part 1 is hereby amended and restated as filed herewith.
PART 1
FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Item 1. Financial Statements
<S> <C>
Consolidated Balance Sheets as of June 30, 2000 (Unaudited) and
December 31, 1999 (Audited).......................................................................................3 - 4
Consolidated Statements of Operations for the Six Months Ended June 30,
2000 and 1999 (Unaudited).........................................................................................5
Consolidated Statements of Changes in Stockholders' Equity for the period from
December 11, 1996 (Date of Inception) to June 30, 2000 (Unaudited)
Consolidated Statements of Cash Flows for the Six Months Ended
June 30, 2000 and 1999............................................................................................6 - 7
Notes to Consolidated Financial Statements........................................................................8 - 13
</TABLE>
<PAGE>
MIZAR ENERGY COMPANY AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
June 30, December 31,
2000 1999
(Unaudited) (Audited)
---------- ----------
Assets
Current assets
Cash $1,104,550 $ 3,842
Accounts receivable 820
Prepaid expenses 82,756
---------- ----------
Total current assets 1,188,126 3,842
Fixed assets (net of accumulated depreciation
of $ 2,730 and $1,191) 45,661 5,290
Intangible assets net of accumulated
amortization of $ 309 and $126) 16,822 2,102
Other assets
Deposits 5,470 470
Due from related parties 6,923 (22,892)
Investments 169,500 75,000
181,893 52,578
---------- ----------
$1,432,502 $ 63,812
========== ==========
See notes to financial statements.
3
<PAGE>
MIZAR ENERGY COMPANY AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
June 30, December 31,
2000 1999
(Unaudited) (Audited)
----------- -----------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable $ 6,748 $ 34,190
Total current liabilities 6,748 34,190
----------- -----------
Shareholders' equity
Common stock no par value, 25,000,000
shares authorized; 10,050,000 shares issued
and outstanding 2,292,445 454,159
Deficit accumulation during the development stage (866,691) (424,537)
----------- --------
1,425,754 29,622
----------- -----------
$ 1,432,502 $ 63,812
=========== ===========
See notes to financial statements.
4
<PAGE>
MIZAR ENERGY COMPANY AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Since Inception
December 11, 1996
through
For the period ended June 30, 2000 June 30, 2000
Three month Six month (Unaudited)
--------- --------- ----------
<S> <C> <C> <C>
Income
Sales net of returns $ 1,610 $ 2,555 $ 11,656
Management fees -- 11,778
Interest income 14,798 17,122 17,122
Cost of sales (193) (331) (4,375)
--------- --------- ---------
Gross profit 16,215 19,346 36,181
Expenses
General and administrative expenses 34,865 89,063 214,669
Salaries 81,130 110,726 217,597
Consulting 51,500 160,609 242,176
Professional fees 12,933 27,084 56,674
Marketing and advertising 3,026 17,606 55,937
Loss Web site design 14,610 24,128 49,317
Rent 15,972 30,582 37,425
Impairment of oil and gas properties 17,876
Leasse operating costs 8,162
Depreciation and amortization 1,198 1,722 3,039
--------- --------- ---------
215,234 461,520 902,872
--------- --------- ---------
Net loss $(199,019) $(442,174) $(866,691)
========= ========= =========
Earnings per share
Net loss per common share $ (0.02) $ (0.04) $ (0.01)
--------- --------- ---------
</TABLE>
See notes to financial statements.
5
<PAGE>
MIZAR ENERGY COMPANY AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM DECEMBER 11, 1996 (DATE OF INCEPTION)
TO JUNE 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
<CAPTION>
Deficit accumulated
Common Stock through the
Shares Amount Development stage TOTAL
------ ------ ----------------- -----
<S> <C> <C> <C> <C>
Issuance of common stock to founders for the period
ended December 1996, in exchange for $30,000 in cash 1,400,000 $ 30,000 $ -- $ 30,000
Issuance of common stock according to the private
offering in effect, through December 1997 ($ 1 per share) 4,100 4,100 4,100
Net loss for the year (24,278) (24,278)
----------- ----------- ----------- -----------
Balance - December 31, 1997 1,404,100 $ 34,100 $ (24,278) $ 9,822
Issuance of common stock according to the private
offering in effect, through December 1998 net of
offering cost of $ 15,831. ($1 per share) 26,600 10,769 10,769
Net loss for the year (14,263) (14,263)
----------- ----------- ----------- -----------
Balance - December 31, 1998 1,430,700 $ 44,869 $ (38,541) $ 6,328
Net loss for the year (5,818) (5,818)
----------- ----------- ----------- -----------
Balance - December 31, 1999 (Audited) 1,430,700 $ 44,869 $ (44,359) $ 510
Issuance of shares of common stock in connection
with the merger of Ingenu Incorporated and HBOA
Com, Inc., on May 24, 2000 8,569,300 2,236,576 (380,178) 1,856,398
----------- ----------- ----------- -----------
Sub-total 10,000,000 $ 2,281,445 $ (424,537) $ 1,856,908
</TABLE>
See notes to financial statements.
6
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM DECEMBER 11, 1996 (DATE OF INCEPTION)
TO JUNE 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Deficit accumulated
Common Stock through the
Shares Amount Development stage TOTAL
------ ------ ----------------- -----
<S> <C> <C> <C> <C>
Sub-total 10,000,000 $ 2,281,445 $ (424,537) $ 1,856,908
On June 5, 2000, 50,000 shares of common stock
were issued to an office as signing bonus shares 50,000 11,000 11,000
Net loss for the six months ended June 30, 2000 (442,174) (442,174)
---------- ----------- ----------- -----------
Balance - June 30, 2000 (Unaudited) 10,050,000 $ 2,292,445 $ (866,711) $ 1,425,734
========== =========== =========== ===========
</TABLE>
See notes to financial statements.
7
<PAGE>
MIZAR ENERGY COMPANY AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Since Inception
December 11, 1996
For the six through
months ended June 30, 2000
June 30, 2000 (Unadited)
------------- --------------
<S> <C> <C>
Cash flows from operating activities
Net Loss $ (442,174) $ (866,691)
----------- -----------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization 1,722 3,039
(Increase) decrease in loans to/from affiliates (29,795) (6,923)
(Increase) decrease in deposits and advances (5,000) (5,470)
(Increase) decrease in accounts receivables (820) (820)
(Increase) decrease in prepaid expenses (82,756) (82,756)
Increase (decrease) in accounts payable (27,442) 6,748
----------- -----------
Total adjustments (144,091) (86,182)
----------- -----------
Net cash provided (used) by operating activities (586,265) (952,873)
----------- -----------
Cash flow from investing activities:
Cash payments for the purchase of investments (94,500) (169,500)
Cash payments for the purchase of property (56,813) (65,522)
----------- -----------
Net cash provided (used) by investing activities (151,313) (235,022)
Cash flow from financing activities:
Proceeds from issuance of common stock 1,838,286 2,292,445
----------- -----------
Net cash provided (used) by financing activities 1,838,286 2,292,445
----------- -----------
Net increase (decrease) in cash and cash equivalents 1,100,708 1,104,550
Cash and cash equivalents, beginning of the period 3,842 --
----------- -----------
Cash and cash equivalents, end of the period $ 1,104,550 $ 1,104,550
=========== ===========
</TABLE>
See notes to financial statements.
8
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED JUNE 30, 2000
NOTE 1 UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted
accounting principles for interim financial information and
with the instructions to Form 10-Q and Rule 310(b) of
Regulation SB. Accordingly, they do not include all of the
information and footnote disclosures normally included in
complete consolidated financial statements prepared in
accordance with generally accepted accounting principles. For
further information, such as significant accounting policies
followed by the Company, refer to the notes to the Company's
audited consolidated financial statements.
In the opinion of management, the unaudited consolidated
financial statements include all necessary adjustments
(consisting of normal, recurring accruals) for a fair
presentation of the financial position, results of operations
and cash flow for the interim periods presented. Preparing
financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets,
liabilities, revenue and expenses. Actual results may differ
from these estimates. Interim results are not necessarily
indicative of results for a full year.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Description
--------------------
Mizar Energy Company (the Company) was incorporated in the
state of Colorado on December 11, 1996, and had no previous
operations. From its inception through December 28, 1999, the
Company was involved in the business of acquiring, developing
and operating oil and gas properties. On December 28, 1999,
the Company's founders sold 59% of the Company's issued and
outstanding common stock to HBOA.Com., Inc., a District of
Columbia corporation. Pursuant to this stock sale, there was a
change in the Company's business and management team. The
Company will now be focusing on developing the premier
Internet portal through which home based business owners
obtain the products, services and information necessary to
start, expand and profitably run their businesses.
On May 24, 2000, Ingenu Incorporated was incorporated under
the laws of the state of Florida. Ingenu Incorporated was
formed to engage in the business of Internet services.
On May 24, 2000, the Company approved the merger of HBOA.Com,
Inc. with and into its wholly owned subsidiary, Ingenu
Incorporated, which took place May 31, 2000. The surviving
corporation retained the name of HBOA.Com, Inc.
The Company is considered to be in the development stage and
the accompanying financials represent those of a development
stage company.
9
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED JUNE 30, 2000
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Principles of Consolidation
---------------------------
The consolidated financial statements of the Company include
those accounts of Mizar Energy Company, a development stage
company, and HBOA.Com, Inc., a wholly owned subsidiary. All
significant intercompany transactions and balances have been
eliminated in the consolidation.
Cash and Cash Equivalents
-------------------------
For purposes of the statement of cash flows, the Company
treats all short-term investments with maturities of three
months or less at acquisition to be cash equivalents.
Use of Estimates
----------------
The preparation of consolidated financial statements in
conformity with generally accepted accounting principles
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 consolidated financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
Revenue Recognition
-------------------
Revenues of HBOA.Com, Inc. are recognized at the time the
services are rendered to customers. Services are rendered when
the Company's representatives receive the customers' requests
and complete the customers' orders.
Property and Equipment
---------------------
Property and equipment are stated at cost. Depreciation of
depreciable assets is computed using the straight-line method
of depreciation over the estimated useful lives of the assets.
The estimated useful life is 5-10 years.
Amortization
------------
Amortization of trademarks and copyrights is determined
utilizing the straight-line method based generally on the
estimated useful lives of the intangibles as follows:
Trademarks 15 years
Internet Website 3 years
Advertising Costs
-----------------
Advertising and marketing costs are expensed as incurred.
During the six months ended June 30, 2000, advertising cost
expenses totaled $17,606.
10
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED JUNE 30, 2000
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Basic Loss Per Share and Diluted Loss Per Share
-----------------------------------------------
In February 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 128,
Earnings Per Share (SFAS No. 128), which specifies the
computation, presentation and disclosure requirements for
earnings per share. SFAS No. 128 supercedes Accounting
Principle Board Opinion No. 15 entitled Earnings Per Share.
Basic earnings per share are computing by dividing income
available to common stockholders (the numerator) by the
weighted-average number of common shares (the denominator) for
the period. The computation of diluted earnings per share is
similar to basic earnings per share, except that the
denominator is increased to include the number of additional
common shares that would have been outstanding if the
potentially dilutive common shares had been issued.
The numerator in calculating basic earnings per share is
reported net loss. The denominator is based on the following
weighted-average number of common shares:
Basic 2,858,917
Concentration of Risk
----------------------
Financial instruments that potentially subject the Company to
credit risk include cash on deposit with three financial
institutions amounting to $1,104,550 at June 30, 2000. Each
financial institution insures its depositors for up to
$100,000 through the U.S. Federal Deposit Insurance
Corporation.
NOTE 3 CAPITAL STOCK TRANSACTIONS
Common Stock
------------
Authorized 25,000,00 shares of common stock, no par value per
share. Issued and outstanding 10,050,000 shares of common
stock as of June 30, 2000.
On May 24, 2000, 8,569,300 shares of common stock were issued
in connection with the merger of Ingenu Incorporated and
HBOA.Com, Inc.
On June 5, 2000, 50,000 shares of common stock were issued to
an officer as signing bonus shares.
Preferred Stock
---------------
Authorized 10,000,000 shares of preferred stock, no par value
per share. None issued as of June 30, 2000.
11
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED JUNE 30, 2000
NOTE 4 INCOME TAXES
At June 30, 2000, the Company had a net operating loss
carryforward for income tax purposes of approximately $855,691
available to offset future income taxes, expiring through
2020.
NOTE 5 OTHER FINANCING ARRANGEMENTS
The Company's subsidiary, HBOA.Com, Inc., with the approval of
the board of directors, and under their current contract with
Communications Group dated April 19, 1999, granted the option
to convert up to 50% of their total current payables for
shares of common stock at a price of $1.00 per share with an
expiration date on June 30, 2000. At June 30, 2000, a total of
12,000 shares have been exchanged.
On November 10, 1999, the Company, with the approval of the
board of directors, granted the option to convert 100% of the
current loan payable to Dundas Systems, Inc. for shares of
common stock at a price of $1.00 per share. At June 30, 2000,
223,149 shares have been exchanged for $223,149 in loans
payable.
NOTE 6 RELATED PARTY TRANSACTIONS
The Company is provided with office space on a rent-free basis
from HBOA.Com, Inc. (see Note 7).
The Company has receivables/payables from related third party
companies at June 30, 2000 as follows:
Due from Dundas Systems, Inc. $ 6,923
Such loans occurred during the ordinary course of business,
bearing no interest, and due on demand. These loans, in the
opinion of management, do not involve more than normal credit
risk or other unfavorable areas of concern.
NOTE 7 GOING CONCERN
The Company's consolidated financial statements are prepared
using the generally accepted accounting principles applicable
to a going concern, which contemplates the realization of
assets and liquidation of liabilities in the normal course of
business. However, the Company has no current source of
revenue. Without realization of additional capital it would be
unlikely for the Company to continue as a going concern. It is
Management's plan to seek additional capital through a merger
with an existing operating company (see Note 7).
12
<PAGE>
MIZAR ENERGY COMPANY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED JUNE 30, 2000
NOTE 8 MERGER
On May 24, 2000 the Company approved the merger of Ingenu
Incorporated, a Florida corporation, its wholly owned
subsidiary with HBOA.Com, Inc., a Florida corporation. The
surviving company was Ingenu Incorporated, and the name of the
combined foundation is HBOA.Com, Inc. The combination was
accounted for as a pooling of interest under which net assets
of both foundations were combined at book value and neither
entity recognized a gain or loss. The merger shall qualify as
a transaction in securities exempt from registration or
qualification under the Securities Act of 1933, as amended
("the Securities Act"), and under applicable state securities
law, and the merger shall qualify as a tax-free reorganization
under Section 386(a)(1)(A) of the Internal Revenue Code of
1986, as amended ("the code").
The shareholders of HBOA.Com, Inc. received 8,569,300 shares
of Mizar Energy Company common stock in exchange for 100%
shares of the Company. After the merger, Mizar Energy Company
retained 10,000,000 shares of its common stock. The operations
of HBOA.Com, Inc. have been consolidated into Mizar Energy
Company.
NOTE 9 SUBSEQUENT EVENT
On June 8, 2000, the Company entered into an option purchase
for $87,500 to acquire 510 shares of Song 1, Inc. for the
amount of $262,500, plus shares of common stock of the Company
equal in value to the sum of $650,000. The option due date is
August 15, 2000.
Stock Option
------------
On July 20, 2000, the board of directors approved an employee
stock option plan, authorizing up to 800,000 shares of common
stock for employees as part of their overall compensation. As
of the date of this report, the plan has not been implemented.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunder duly authorized.
MIZAR ENERGY COMPANY
Date: October 31, 2000 By: /s/ Edward A. Saludes
---------------------
Edward A. Saludes
Chief Executive Officer and President
14
