<TABLE>
<S><C>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to _______________
Commission File Number: 0-26075
American Kiosk Corporation
(Exact name of small business issuer as specified in its charter)
Delaware 59-3452641
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4400 PGA Blvd., Suite 500, Palm Beach Gardens, FL 33410+
(Address of Principal Executive Office)
(561) 627-9002
(Issuer's Telephone Number)
__________________________________Not Applicable________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the Issuer (1) filed all reports required to be filled by Section 13 or15 (d) of the 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 Yes __X____ No ________
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of
the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes______ No________
Not Applicable
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the Issuer's classes of common Equity, as of the latest practical
date:
Common stock $ .0001 par value 5,782,180 shares outstanding as of 5/14/00
Transitional Small Business Disclosure Format (check one) Yes ___X____ No ______
AMERICAN KIOSK CORPORATION
INDEX
Page(s)
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Condensed Balance Sheet - As of
March 31, 2000 and December, 31 1999 3
Condensed Statements of Changes
In Shareholder's Equity - For the
Period from December 31, 1999 through
March 31, 2000 4
Condensed Statements of Operations -
For the 3 months ended March 31, 2000
And March 31, 1999 5
Condensed Statements of Cash Flows -
For the 3 months ended March 31, 2000 6
And March 31, 1999
Notes to Condensed Financial Statements 7
Item 2. Management's Discussion and Analysis 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. 9
2
AMERICAN KIOSK CORPORATION
Condensed Balance Sheet as of
March 31, 2000 and December 31, 1999
YEAR END
3/31/00 12/31/99
***********************************************************************************
(UNAUDITED) (AUDITED)
ASSETS
CURRENT ASSETS:
CASH AND EQUIVALENTS $79,822 $141,391
ACCOUNTS RECEIVABLE $9,447 $0
INVENTORIES $0 $0
DEPOSITS & OTHER CURRENT ASSETS $63,689 $78,649
DEFERRED LOAN COSTS $123,060 $123,060
TOTAL CURRENT ASSETS $276,018 $343,100
PROPERTY & EQUIPMENT $91,843 $44,046
NOTE RECEIVABLE $130,256 $57,720
OTHER ASSETS $143,627 $96,277
GOODWILL $646,473 $0
TOTAL ASSETS $1,288,217 $541,143
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE & ACCRUALS $309,533 $327,431
CONVERTIBLE NOTES PAYABLE $784,983 $451,360
TOTAL CURRENT LIABILITIES $1,094,516 $778,791
NOTES PAYABLE - 30 MONTH $1,936,961 $1,936,961
TOTAL LIABILITIES $3,031,477 $2,715,752
SHAREHOLDERS' EQUITY:
COMMON STOCK, $.0001 PAR $578 $428
ADDITIONAL PAID-IN-CAPITAL $2,057,210 $1,307,360
ACCUMULATED DEFICIT ($3,801,048) ($3,482,397)
TOTAL SHAREHOLDERS' EQUITY ($1,743,260) ($2,174,609)
TOTAL LIABILITIES AND EQUITY $1,288,217 $541,143
3
AMERICAN KIOSK CORPORATION
Condensed Statement of Changes in Shareholder's Equity
for the three months ended March 31, 2000
(Unaudited)
COMMON ADDITIONAL
STOCK PAID-IN ACCUMULATED UNEARNED SHRHLDR'S
SHARES AMOUNT CAPITAL DEFICIT COMPENSATION EQUITY
***********************************************************************************************************************
BALANCE DECEMBER 31, 1999 4,282,180 $428 $1,307,360 ($3,482,397) $0 ($2,174,609)
PURCHASE OF ZERO'S MR. SUBMARINE INC 1,500,000 $150 $749,850 $750,000
NET LOSS ($318,651) ($318,651)
BALANCE MARCH 31, 2000 5,782,180 $578 $2,057,210 ($3,801,048) $0 ($1,743,260)
4
AMERICAN KIOSK CORPORATION
Condensed Statement of Operations
(Unaudited)
3 MO ENDED 3 MO ENDED
3/31/00 3/31/99
***********************************************************************************
REVENUES
FRANCHISE FEES $90,000
ROYALTIES $76,023
OTHER $14,843 $9,799
TOTAL REVENUES $180,866 $9,799
COST OF GOODS SOLD $0 ($13,020)
FRANCHISE AND ROYALTY COMMISSIONS ($38,309) $0
SELLING, GENERAL & ADMIN EXPENSES ($391,578) ($357,125)
LOSS FROM OPERATIONS ($249,021) ($360,346)
OTHER EXPENSES ($69,630) ($18,801)
NET (LOSS) ($318,651) ($379,147)
BASIC AND DILUTED NET (LOSS) PER SHARE ($0.058) ($0.091)
WEIGHTED AVERAGE SHARES OUTSTANDING 5,530,117 4,167,663
5
AMERICAN KIOSK CORPORATION
Condensed Statement of Cash Flow
(Unaudited)
3 MO ENDED 3 MO ENDED
3/31/00 3/31/99
***********************************************************************************
CASH USED IN OPERATING ACTIVITIES ($286,561) ($665,775)
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property and equipment ($47,797) ($94,602)
Other $0 $0
Net cash used by investing activities ($47,797) ($94,602)
CASH FLOWS FROM FINANCING ACTIVITIES:
Notes Payable $383,623 $825,400
Proceeds from issuance of stock $0 $16,508
Repayment of Notes Receivable ($50,000) $0
Net cash provided by financing activities $333,623 $841,908
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ($735) $81,531
CASH AND CASH EQUIV, BEGINNING OF PERIOD $80,557 $350,136
CASH AND CASH EQUIV, AT END OF PERIOD $79,822 $431,667
6
AMERICAN KIOSK CORPORATION
Notes to Financial Statements
(Unaudited)
Note 1 - Financial Statements
In the opinion of the Company's management, the accompanying unaudited condensed financial statements
contain all adjustments, consisting of only normal recurring adjustments, necessary to present fairly
the financial position of the Company as of March 31, 2000 and the results of operations and the cash
flows for the 3 months ended March 31, 2000 and 1999. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These statements should be read in conjunction with the audited financial
statements for the fiscal year ended December 31, 1999, and notes thereto contained in the Company's Form 10-KSB
filed with the Securities and Exchange Commission on April 14, 2000. The results of operations for the three
months ended March 31, 2000 are not necessarily indicative of operating results to be expected for the full fiscal year.
Note 2 - Notes Payable and Stock Issuance
During the three months ended March 31, 2000, the Company issued 1,500,000 shares of Common Stock (valued at
$.50 per share) related to the asset purchase of Zero's Mr. Submarine Inc. The Company also received funding
from the issuance of additional private placement units of 12.5% secured notes aggregating $383,623.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
BUSINESS
The Company, incorporated in Delaware in May, 1997, has developed and implemented a national brand
franchise system of stand alone, in-line and drive-thru retail outlets to deliver popular food products
to consumers. The Company initially focused primarily on brick oven pizza, however, since the recent
asset purchase of Zero's Mr. Submarine Inc., the franchisor of a 55 unit hot submarine sandwich chain,
located in Virginia Beach, VA, the Company has changed its focus and direction. The Company now intends
to focus its resources on the expansion and improvement of the Zero's chain.
The Company is currently engaged in the sale of franchises to operate fast food outlets from stand alone,
in-line and drive-thru retail units. The Company's outlets sell proprietary hot submarine sandwiches and other
food products.
LIQUIDITY AND CAPITAL RESOURCES
The Company, during the last quarter, raised $383,623 from a private placement consisting of 12.5% secured
notes, bringing the total raised under this plan to $749,623.
REVENUES
Revenues for the three months ended March 31, 2000, were $180,866 as compared to $9,799 for the three months
ended March 31, 1999. This increase is attributable to the franchise fee and royalty fees generated from the
recently acquired Zero's Mr. Submarine business.
COST OF GOODS / FRANCHISE FEE AND ROYALTY FEE COMMISSIONS
Franchise fee and royalty fee commissions for the three months ended March 31, 2000 were $38,309 as compared
to cost of goods sold of $13,020 for the same period ending March 31, 1999. This increase was attributable to the
increase in revenue generated through the acquisition of Zero's franchises, as well as the sale of a new franchise
for the Zero's chain.
SELLING EXPENSES & ADMINISTRATIVE COSTS
Selling, General and Administrative costs for the three months ended March 31, 2000 were $391,578 as compared to
$357,125 for the period ending March 31, 1999. This slight increase is attributable to the payroll and other expenses
generated from the purchase of Zero's Mr. Submarine, Inc., as well as additional spending in the period for advertising
and promotion.
NET PROFIT/LOSS
The Company's net loss per share for the three months ended March 31, 2000 was 5.8 cents as compared to 9.1 cents per
share for the three months ended March 31, 1999. This improvement in net loss is attributable to the increase in revenue
generated from Zero's and also is affected by the addition of 1,500,000 shares resulting from the purchase of Zero's assets.
8
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits.
Exhibit No. Description
*27 Financial Data Schedule
*Filed as exhibit to this Report.
b. Reports on Form 8-K.
The Company filed a form 8-K with the Securities and Exchange Commission on January 31, 2000. The filing
covered the purchase of all the assets of Zero's Mr. Submarine Inc., a fast food franchise company located in Virginia
Beach, VA.
In accordance with Section 12 (g) of the Securities Exchange Act of 1934, the Registrant caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
AMERICAN KIOSK CORPORATION
By: /s/ Richard J. Michael
-------------------------------------------
Richard J. Michael, President
By: /s/ Larry E. Graybill
------------------------------------------
Larry E. Graybill
Vice-President, Chief Financial Officer
and Principal Accounting Officer
9
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 79,822
<SECURITIES> 0
<RECEIVABLES> 9,447
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 276,018
<PP&E> 91,843
<DEPRECIATION> 10,070
<TOTAL-ASSETS> 1,288,217
<CURRENT-LIABILITIES> 1,094,516
<BONDS> 1,936,961
0
0
<COMMON> 578
<OTHER-SE> (1,743,838)
<TOTAL-LIABILITY-AND-EQUITY> 1,288,217
<SALES> 180,866
<TOTAL-REVENUES> 12,784
<CGS> (38,309)
<TOTAL-COSTS> (38,309)
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (69,630)
<INCOME-PRETAX> (318,651)
<INCOME-TAX> 0
<INCOME-CONTINUING> (318,651)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (318,651)
<EPS-BASIC> (.058)
<EPS-DILUTED> (.058)
</TABLE>
