UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[ X ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended April 30, 2000
[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period to
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Commission File Number 0-29067
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NORTH AMERICAN RESORT & GOLF INC.
(Exact name of small Business Issuer as specified in its charter)
Nevada 98-0173359
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(State or other jurisdiction of (IRS Employer Identification No.)
-------------------------------
incorporation or organization)
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#676, 141 - 757 West Hastings Street
Vancouver, BC V6C 1A1
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(Address of principal executive offices) (Postal or Zip Code)
Issuer's telephone number, including area code: 604-681-7806
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None
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(Former name, former address and former fiscal year, if changed since
last report)
Check whether the issuer (1) 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 issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days [ X ] Yes [ ] No
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 4,989,367 Common Shares of $0.001 par
value outstanding as of April 30, 2000, and 4,500,000 Series A Preferred Shares
with no par value outstanding at April 30, 2000.
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-QSB and Item 310 (b) of Regulation S-B, and,
therefore, do not include all information and footnotes necessary for a complete
presentation of financial position, results of operations, cash flows, and
stockholders' equity in conformity with generally accepted accounting
principles. In the opinion of management, all adjustments considered necessary
for a fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring nature.
Operating results for the nine months ended April 30, 2000 are not necessarily
indicative of the results that can be expected for the year ending July 31,
2000.
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
(Stated in U.S. Dollars)
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APRIL 30
2000 1999
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ASSETS
Current
Cash $ 7,747 $ 18,941
Accounts receivable 4,489 5,669
Loan receivable 50,000 -
Due from shareholders 87,110 -
Prepaid expenses 4,708 630
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154,054 25,240
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Capital Assets 32,434 30,818
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$ 186,488 $ 56,058
================================================================================
LIABILITIES
Current
Accounts payable and accrued liabilities $ 97,041 $ 42,428
Due to shareholder - 17,300
Due to related parties 70,806 8,836
Notes payable 69,932 -
-------- --------
237,779 68,564
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SHAREHOLDERS' DEFICIENCY
Capital Stock
Authorized:
50,000,000 common shares, par value $0.001 per share
10,000,000 preferred shares, par value $0.001 per share
The rights and preferences of these preferred shares
have not been determined.
4,500,000 Series A preferred shares with no par value
Issued and Outstanding:
4,989,367 common shares at April 30, 2000 and 1999 400 300
4,500,000 Series A preferred shares at April 30, 2000
and
0 at April 30, 1999 113,520 -
-------- --------
113,920 300
Cumulative Translation Adjustment (1,843) (2,931)
Deficit (163,368) (9,875)
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(51,291) (12,506)
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$ 186,488 $ 56,058
================================================================================
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
CONSOLIDATED STATEMENT OF LOSS AND DEFICIT
(Unaudited)
(Stated in U.S. Dollars)
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NINE MONTHS ENDED
APRIL 30
2000 1999
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Revenue
Sales $ 407,402 $ 239,377
Other 431 -
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407,833 239,377
Direct Costs
Commissions 71,890 44,806
Courier charges 1,963 1,869
Credit card charges 7,503 4,589
Telephone 20,673 20,738
Wages and benefits 36,824 25,178
Web site costs 9,530 6,241
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148,383 103,421
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259,450 135,956
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Expenses
Advertising and promotion 11,290 10,355
Amortization 11,783 6,912
Automobile 2,267 2,463
Bank charges and interest 4,718 2,200
Computer services 10,118 3,024
Equipment lease 2,099 1,363
Insurance 1,852 129
Investor relations 5,442 -
Management fees 12,188 29,605
Membership and dues 2,281 2,295
Office rent 14,431 6,576
Office supplies 7,758 6,347
Professional fees 63,559 2,388
Repairs and maintenance 4,967 813
Telephone 9,680 11,844
Travel 5,171 5,630
Wages and benefits 196,851 52,721
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366,455 144,665
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Loss For The Period 107,005 8,709
Deficit, Beginning Of Period 56,363 1,166
Deficit, End Of Period $ 163,368 $ 9,875
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Net Loss Per Share $ 0.02 $ 0.01
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Weighted Average Number Of Shares Outstanding 4,989,367 4,989,367
================================================================================
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
(Stated in U.S. Dollars)
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NINE MONTHS ENDED
APRIL 30
2000 1999
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Cash Flows From Operating Activities
Net loss for the period $(107,005) $ (8,709)
Add: Non-cash item:
Amortization 11,783 6,912
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(95,222) (1,797)
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Change in non-cash working capital balances
related to operations 204,669 61,199
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109,447 59,402
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Cash Flows From Investing Activities
Purchase of parent company assets,
net of cash acquired (107,423) -
Acquisition of capital assets - (37,730)
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(107,423) (37,730)
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Cash Flows From Financing Activity
Common stock issued - 200
Effect Of Exchange Rate On Changes In Cash (3,377) (2,931)
Increase (Decrease) In Cash During The Period (1,353) 18,941
Cash, Beginning Of Period 9,100 -
Cash, End Of Period $ 7,747 $ 18,941
================================================================================
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
<TABLE>
<CAPTION>
SERIES A
COMMON STOCK PREFERRED STOCK
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Number Number
Of Of Accumulated
Shares Amount Shares Amount Other Deficit Total
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<S> <C> <C> <C> <C> <C> <C> <C>
Balance, July 31, 1998 100 $ 100 - $ - $ - $ (1,166) $ (1,066)
Issuance of common shares 200 200 - - - - 200
Translation adjustment - - - - (2,931) - (2,931)
Loss for the period - - - - - (8,709) (8,709)
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Balance, April 30, 1999 300 $ 300 - $ - $ (2,931) $ (9,875) $ (12,506)
==============================================================================================
Balance, July 31, 1999 20,300 $ 400 - $ - $ 1,534 $ (56,363) $ (54,429)
Adjustment to number of shares
issued and outstanding as a
result of the reverse take-over
transaction:
Most Referred Real Estate
Agents Inc. (100) - - - - - -
Home Finders Realty Ltd. (20,200) - - - - - -
North American Resort
& Golf, Inc. 4,989,367 - - - - - -
Ascribed value of shares
issued in connection with
the acquisition of Most
Referred Real Estate
Agents Inc. and Home
Finders Realty Ltd. - - 4,500,000 113,520 - - 113,520
Translation adjustment - - - - (3,377) - (3,377)
Loss for the period - - - - - (107,005) (107,005)
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Balance, April 30, 2000 4,989,367 $ 400 4,500,000 $113,520 $ (1,843) $(163,368) $ (51,291)
==============================================================================================
</TABLE>
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
1. NATURE OF OPERATIONS
The Company's primary business activities of the Company's subsidiaries is the
marketing, via the Internet, of real estate referral services, and to provide
related management services.
2. SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements of the Company has been prepared in
accordance with generally accepted accounting principles in the United States.
Because a precise determination of many assets and liabilities is dependent upon
future events, the preparation of consolidated financial statements for a period
necessarily involves the use of estimates which have been made using careful
judgement.
The consolidated financial statements have, in management's opinion, been
properly prepared within reasonable limits of materiality, and within the
framework of the significant accounting policies summarized below:
a) Consolidation
These consolidated financial statements include the accounts of the
Company and its Canadian subsidiaries, Most Referred Real Estate Agents
Inc. and Home Finders Realty Ltd.
b) Use of Estimates
The preparation of 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
financial statements, and the reported amounts of revenues and expenses
for the reporting period. Actual results could differ from these estimates.
c) Foreign Currency Translation
The operations of the Company's subsidiaries, Most Referred Real Estate
Agents Inc. and Home Finders Realty Ltd., are located in Vancouver, Canada,
and its functional currency is the Canadian dollar. The consolidated
financial statements have been translated using the current method whereby
the assets and liabilities are translated at the year end exchange rate,
capital accounts at the historical exchange rate, and revenues and expenses
at the average exchange rate for the period. Adjustments arising from the
translation of the Company's consolidated financial statements are included
as a separate component of shareholders' equity.
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
2. SIGNIFICANT ACCOUNTING POLICIES (Continued)
d) Net Loss Per Share
Net loss per share is based on the weighted average number of common shares
outstanding during the period plus common share equivalents, such as
options, warrants and certain convertible securities. This method requires
primary earnings per share to be computed as if the common share
equivalents were exercised at the beginning of the period or at the date of
issue, and as if the funds obtained thereby were used to purchase common
shares of the Company at its average market value during the period.
e) Income Taxes
The Company uses the liability method of accounting for income taxes
pursuant to Statement of Financial Accounting Standards, No. 109
"Accounting for Income Taxes".
f) Capital Assets and Amortization
Capital assets are recorded at cost and are amortized at the rate of 20%
per annum using the declining balance method.
g) Fair Value of Financial Instruments
The carrying value of cash, account payable and advances payable
approximate fair value because of the short maturity of those instruments.
3. ACQUISITION OF SUBSIDIARIES
Effective April 28, 2000, North American Resort & Golf, Inc. acquired 100% of
the issued and outstanding shares of Most Referred Real Estate Agents Inc. and
Home Finders Realty Ltd. by issuing 4,500,000 Series A preferred shares. Since
the transaction resulted in the former shareholders of Most Referred Real Estate
Agents Inc. and Home Finders Realty Ltd. owning the majority of the issued
shares of North American Resort & Golf, Inc., the transaction, which is referred
to as a "reverse take-over", has been treated for accounting purposes as an
acquisition by Most Referred Real Estate Agents Inc. and Home Finders Realty
Ltd. of the net assets and liabilities of North American Resort & Golf, Inc.
Under this purchase method of accounting, the results of operations of North
American Resort & Golf, Inc. are included in these consolidated financial
statements from April 28, 2000.
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
3. ACQUISITION OF SUBSIDIARIES (Continued)
Control of the net assets of North American Resort & Golf, Inc. was acquired for
total consideration of $113,520 representing the fair value of the assets of
North American Resort & Golf, Inc. Most Referred Real Estate Agents Inc. and
Home Finders Realty Ltd. are deemed to be the purchasers for accounting
purposes. Accordingly, their net assets are included in the accounts at their
previously recorded values.
The acquisition is summarized as follows:
Current assets (including cash of $6,097) $ 149,121
Current liabilities 35,601
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$ 113,520
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Consideration given at fair market value:
Issuance of Series A preferred shares $ 113,520
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4. CAPITAL STOCK
a) The Company granted stock options for the purchase of up to 400,000
shares at $0.25 per share to December 6, 2001, and up to 300,000 shares at
$1.00 per share to March 1, 2001.
b) The Company has outstanding share purchase warrants for the purchase of
common shares as follows:
Number Exercise Price Expiry Date
Of Shares Year 1 Year 2 Year 1 Year 2
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200,000 $ 0.50 $ 0.75 December 22, 2000 December 22,2000
50,000 $ 0.75 $ 0.75 February 10, 2001
61,500 $ 0.75 $ 0.75 March 10, 2001
125,667 $ 1.00 $ 1.00 March 17, 2001
<PAGE>
NORTH AMERICAN RESORT & GOLF, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
5. UNCERTAINTY DUE TO THE YEAR 2000 ISSUE
The Year 2000 Issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in some
systems which use certain dates in 1999 to represent something other than a
date. Although the change in date has occurred, it is not possible to conclude
that all aspects of the Year 2000 Issue that may affect the entity, including
those related to customers, suppliers, or other third parties, have been fully
resolved.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
NRGF (North American Resort & Golf, Inc.) has finalized the acquisition of all
of the shares of MOST REFERRED REAL ESTATE AGENTS INC. and HOME FINDERS REALTY
LTD. ("Most Referred").
The financial statements reflect the expenses incurred by the company in the
following areas: redesigning the web sites to work on a cold fusion platform;
setting up company owned web site servers with extensive backup technology to
have five way redundancy on ISP backbone; reorganization of the company in
preparation for the public process, and the costs associated with completing the
public process.
The company is now in the process of changing its name to MarketU Inc. The new
company, MarketU Inc., reflects the family of Real Estate Websites AMRR.com,
CMRR.com, and 85 other real estate domain web sites developed by Home Finders
Realty Ltd.
MarketU specializes in generating business for business. The company is
projecting release of its latest version of lead generating, lead qualifying,
and lead maintenance programs for the real estate industry within the next four
to six weeks.
The merger now enables the further capitalization of development projects that
are meant to bring doing business on the Internet to higher levels of long term
client retention. MarketU is commited to bringing superior quality, more
effective real estate solutions to the public through the top real estate
professional in the industry.
<PAGE>
CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995
From time to time, the Company will make written and oral forward-looking
statements about matters that involve risk and uncertainties that could cause
actual results to differ materially from projected results.
Many of these factors are beyond the Company's ability to control and predict.
Investors are cautioned not to place undue reliance on forward-looking
statements. The Company disclaims any intent or obligation to update its
forward-looking statements, whether as a result of receiving new information,
the occurrence of future events, or otherwise.
<PAGE>
PART 2 - 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 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) None
(b) Reports on Form 8-K - None
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
NORTH AMERICAN RESORT & GOLF INC.
Date: June 21, 2000
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By: /s/ William Coughlin
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WILLIAM COUGHLIN, Director and President
<PAGE>
