SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
Quarter ended June 30, 1999
PEAKSOFT MULTINET CORP.
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(Translation of registrant's name into English)
1801 Roeder Avenue; Suite 144, Bellingham, WA 98225
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(Address of principal executive offices)
[Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.]
Form 20-F ..X.. Form 40-F ____
[Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes ..X.. No ____
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-0-24069
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Signatures: T. W. Metz
Pursuant to the requirements 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.
Peaksoft Multinet Corp.
(Registrant)
Date August 30, 1999
(Signature) By: /s/ T.W. Metz
----------------------
T.W. Metz
Chief Operating Officer
Page 1 of 11
<PAGE>
PEAKSOFT MULTINET CORP.
Third Quarter Report
For the three months ended June 30, 1999
Page 2 of 11
<PAGE>
LETTER TO SHAREHOLDERS
The Company continued to show a steady improvement in bottom line items such as
net sales and a declining net loss. Sales of the company's utilities in the
quarter were modestly higher than the same quarter for 1998, but with a major
improvement in gross margin and reduction in selling expense. Management expects
the Company to continue in this positive direction.
During the quarter management directed significant resources to the development
and planned launch of its Online Small Business Community to be located at
http://www.peak.com and moved its corporate site to http://www.peaksoft.com. The
Company attended Networld+Interop, in the Novell partner pavilion in May, where
the first 4 vertical tools were unveiled and early registration was commenced.
There are 85 million small businesses across the globe, with 7 million of these
within the United States. These businesses have been virtually ignored due to
their size and diversity. PeakSoft has developed a plan to "facilitate the
formation, growth, and prosperity of small business globally through leading
Internet communications solutions which empower small business to compile
knowledge, and to develop e-commerce and other commercial relationships."
Through http://www.peak.com, we will provide services, products, information,
and forums (to name a few of our offerings) to the Small Business Community that
will assist its members in the task of achieving profitability and prosperity.
PeakSoft is also expected to thrive by driving revenues from several diverse
sources: advertising, revenue sharing, etc.
Helping Small Business seize the E-Opportunity.
The release of the PeakTrack Business Series, content rich software tools
designed to increase productivity in small businesses was also announced during
the quarter. PeakTrack will enhance the functionality of the company's online
business community, http://www.peak.com. The PeakTrack Business Series initially
consists of four industry specific tools, PeakTrack Law, PeakTrack Travel,
PeakTrack Realty and PeakTrack Business. More information on these products can
be found at http://peaktrack.com.
Capital continues to be a major issue for the Company. During the quarter the
Company obtained an additional USD $100,000 in operating capital. Subsequent to
the end of the subject period, the company obtained an additional USD $200,000.
We believe that the Company has developed a very high opportunity plan and can
be positioned to take maximum advantage of the dynamic Internet Market. We are
seeking to leverage our experience, technology and partnerships to this end.
Sincerely yours,
"T.W. METZ"
- -------------------------
T.W. METZ
Chief Operating Officer
August 30, 1999
Page 3 of 11
<PAGE>
Consolidated Balance Sheet
(Prepared by Management)
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June 30, 1999 1998
- ---------------------------------------------------------------------------
(in Canadian dollars)
Assets
Current Assets
Cash $ 37,371 $ 33,907
Accounts receivable 124,639 203,851
Inventories 42,442 93,849
Prepaids and deposits 24,045 47,180
- ---------------------------------------------------------------------------
228,497 378,787
Capital assets 78,773 138,784
Acquired research & development - 205,574
Investment in InfoBuild 284,000 284,000
- ---------------------------------------------------------------------------
$ 591,270 $ 1,007,145
===========================================================================
Liabilities and Shareholders' Equity
Current liabilities:
Demand loan - -
Accounts payable and accrued liabilities 879,842 702,320
Interest payable on long-term debt 26,130 153,187
Reserve for returns & allowances - 53,101
Current portion of obligations under 22,703 29,551
capital leases
- ---------------------------------------------------------------------------
928,675 938,159
Long-term debt 517,643 1,927,802
Obligations under capital leases 2,582 37,867
Shareholders' Equity:
Share capital 9,460,955 6,506,149
Accumulated deficit 10,318,585 8,402,832
- ---------------------------------------------------------------------------
(10,318,585) (8,402,832)
- ---------------------------------------------------------------------------
$ 591,270 $ 1,007,145
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Page 4 of 11
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statement of Operations and Deficit
- -----------------------------------------------------------------------------------------------------------------------------
Quarter Quarter Nine Months Nine Months
ended ended ended ended
June 30, June 30, June 30, June 30,
(in Canadian dollars) 1999 1998 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Sales $ 188,667 $ 127,796 $ 475,646 $ 1,027,378
Cost of goods sold 6,520 33,671 18,161 192,511
- -----------------------------------------------------------------------------------------------------------------------------
182,147 94,125 457,485 834,867
Operating Expenses:
General and administration 465,468 328,058 1,012,253 1,198,165
Selling and marketing 87,071 133,259 262,172 829,258
Interest on LT Debt - - 77,231 -
Research and development 71,798 111,355 232,933 435,365
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624,337 572,672 1,584,589 2,462,788
- -----------------------------------------------------------------------------------------------------------------------------
Earnings (loss) before the undernoted (442,190) (478,547) (1,127,104) (1,627,921)
Amortization 13,942 246,278 40,472 746,971
Recovery of expenses from settlement 44,698 - 44,698 252,509
of liabilities
- -----------------------------------------------------------------------------------------------------------------------------
Earnings (loss) from operations $ (411,434) $ (724,825) $ (1,122,878) $ (2,122,383)
Gain on sale of contract - - - 134,951
- -----------------------------------------------------------------------------------------------------------------------------
Net earnings (loss) (411,434) (724,825) (1,122,878) (1,987,432)
Accumulated deficit, beginning of period $ (9,907,151) $(7,678,007) $ (9,195,707) $ (6,415,400)
- -----------------------------------------------------------------------------------------------------------------------------
Accumulated deficit, end of period $(10,318,585) $(8,402,832) $(10,318,585) $ (8,402,832)
=============================================================================================================================
Loss per common share (0.03) * (0.05) * (0.08) * (0.15) *
=============================================================================================================================
Loss per common share (0.11) ** (0.19) ** (0.30) ** (0.52) **
* Loss per common share calculated on shares outstanding before consolidation.
** Loss per common share if calculated on shares outstanding after consolidation.
NUMBER OF SHARES OUTSTANDING
Basic * 13,515,463 * 13,515,463 * 13,515,463 * 13,515,463
** 3,794,920 ** 3,794,920 ** 3,794,920 ** 3,794,920
</TABLE>
Page 5 of 11
<PAGE>
<TABLE>
<CAPTION>
Statement of Changes in Financial
Position
- -----------------------------------------------------------------------------------------------------------------------------
Quarter Quarter Nine Months Nine Months
ended ended ended ended
June 30, June 30, June 30, June 30,
(in Canadian dollars) 1999 1998 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash provided by (used in):
Operations:
Net earnings (loss) $ (411,434) $ (724,825) $(1,122,878) $(1,987,432)
Items not involving cash:
Amortization 13,942 246,278 40,472 746,971
Change in non-cash operating 196,605 140,445 (216,666) (355,997)
working capital -
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(200,887) (338,102) (1,299,072) (1,596,458)
Financing:
Long Term Debt 73,500 304,851 517,643 531,875
Obligation under capital leases (3,747) (4,975) (26,057) 1,867
Decrease in obligation to issue shares 11,432 - - (399,900)
Issuance of share capital - 20,055 835,331 532,199
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81,185 319,931 1,326,917 666,041
Investments:
Purchase of capital assets 2,296 (9,006) (13,298) (107,042)
- -----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash position (117,406) (27,177) 14,547 (1,037,459)
Cash, beginning of period 154,777 61,084 22,824 1,071,366
- -----------------------------------------------------------------------------------------------------------------------------
Cash, end of period $ 37,371 $ 33,907 $ 37,371 $ 33,907
=============================================================================================================================
</TABLE>
Page 6 of 11
<PAGE>
THIRD QUARTER REVIEW
The quarter ending June 30, 1999 shows a considerable improvement in net loss as
compared with the quarter ending June 30, 1998. Net loss for the third quarter
ended June 30, 1998 decreased from CDN $724,825 to CDN $411,434 in the
comparable quarter ended June 30, 1999 or 43.24%. This was primarily due to
management's continued efforts to reduce expenses along with the focus on
e-commerce/partnering as the preferred method of software distribution.
Net sales increased from CDN $94,125 in the third quarter ended June 30, 1998 to
CDN $182,147 in the comparable quarter ended June 30 ,1999 or 48.32%. With the
reduced costs of electronic commerce, cost of goods sold accounted for only
3.46% of sales for the quarter ended June 30, 1999 as compared with 26.35% for
the comparable quarter ended June 30, 1998.
Operating expenses increased from CDN $572,672 in the third quarter ended June
30, 1998 to CDN $624,337 in the comparable quarter ended June 30, 1999 or 8.28%.
General and administrative expenses increased while selling and marketing and
research and development decreased. The primary explanations are explained
below.
General and administrative expenses increased from CDN $328,058 in the third
quarter ended June 30, 1998 to CDN $465,468 in the comparable quarter ended June
30, 1999 or 29.52%. The increases occurred primarily due to the increase of
consulting and professional services used to develop our small business
community portal. During the company's third quarter, the directors approved and
signed employment contracts with three key management personnel.
Selling and marketing expenses decreased from CDN $133,259 in the third quarter
ended June 30, 1998 to CDN $87,071 in the comparable quarter ended June 30,1999
or 34.66%. This was primarily due to management's continued reduction in
expenses and the developmental stage of its planned new products and services,
while continuing to focus on e-commerce/partnering as the preferred method of
software distribution.
Research and development expenses decreased from CDN $111,355 in the third
quarter ended June 30, 1998 to CDN $71,798 in the comparable quarter ended June
30, 1998 or 35.52%. As with selling and marketing, the decrease in expenses was
due to management's goal of reducing expenditures.
During the third quarter, management was able to negotiate with creditors to
realize a CDN $44,698 reduction of liabilities.
Amortization decreased from CDN $246,278 in the third quarter ended June 30,
1998 to CDN $13,942 for the comparable period in 1999. Amortization for 1998
included the research and development acquired from Chameleon Bridge
Technologies Corp. This was fully amortized by the end of the fiscal year 1998.
Page 7 of 11
<PAGE>
NINE MONTHS REVIEW
The nine months ended June 30, 1999 shows a considerable improvement in net loss
as compared with the nine months ended June 30, 1998. Net loss for the nine
months ended June 30, 1998 decreased from CDN $1,987,432 to CDN $1,122,878 in
the comparable nine months or 43.50%. This was due to management's continued
efforts to reduce expenses along with the focus on e-commerce/partnering as the
preferred method of software distribution.
Net sales decreased from CDN $834,867 for the nine months ended June 30, 1998 to
CDN $457,485 in the comparable nine months ended June 30, 1999 or 45.04%. This
decrease is primarily due to the Company's focus and commitment to the
developmental stage of our small business community portal along with the
decision not to pursue normal retail outlets to sell our utility programs, that
were deemed unprofitable.
Operating expenses decreased from CDN $2,462,788 for the nine months ended June
30, 1998 to CDN $1,584,589 for the comparable nine months ended June 30, 1999 or
35.66%. The primary explanations are explained below.
General and administrative expenses decreased from CDN $1,198,165 for the nine
months ended June 30, 1998 to CDN $1,012,253 for the comparable nine months
ended June 30, 1999 or 15.52% due to management's continued efforts to reduce
expenses.
Selling and marketing expenses decreased from CDN $829,258 for the nine months
ended June 30, 1998 to CDN $262,172 for the comparable nine months ended June
30, 1999 or 68.38%. This was primarily due to management's continued reduction
in expenses and the continued focus on e-commerce/partnering as the preferred
method of software distribution.
Research and development expenses decreased from CDN $435,365 for the nine
months ended June 30, 1998 to CDN $232,933 for the comparable nine months ended
June 30, 1999 or 46.50%. As with selling and marketing, the decrease in expenses
was due to management's goal of reducing expenditures.
Amortization decreased from CDN $746,971 for the nine months ended June 30, 1998
to CDN $40,472 for the comparable nine months ended June 30, 1999 or 94.58%.
Amortization for 1998 included the research and development acquired from
Chameleon Bridge Technologies Corp. This was fully amortized by the end of the
fiscal year 1998.
Page 8 of 11
<PAGE>
YEAR 2000
In response to the Year 2000 compliance rule established by the Board
of Governors of the Alberta Stock Exchange; the Company has conducted a
comprehensive review of its computer systems to identify the systems that could
be affected by the "Year 2000" issue and is developing an implementation plan to
resolve the issue. The Year 2000 problem is the result of computer programs
being written using two digits rather than four to define the applicable year.
Time-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in a major system failure or
miscalculations. The Company presently believes that, with modifications to
existing software and the conversion to new software, the Year 2000 problem will
not pose significant operational problems for the Company's computer systems as
so modified and converted. The Company has completed the required modification
and conversions. The Company is in the process of obtaining Year 2000 compliance
statements from vendors, suppliers, and all other third parties that do business
with the Company.
Based upon the foregoing, PeakSoft does not believe it is necessary to
undertake any special measures to cope with the turn of the century. PeakSoft
backs up all critical data as a matter of routine.
PeakSoft does not believe that its computer systems require remediation
to render them Y2K issues.
PeakSoft has concluded that it faces no material Y2K implications to
its business operations because its computer and the programs being run on them
are of recent vintage, marketed as being Y2K compliant.
This release may contain forward-looking statements as well as
historical information. Forward-looking statements, which are
included in accordance with the "safe harbor" provisions of the
"Private Securities Litigation Reform Act of 1995, may involve known
and unknown risks, uncertainties and other factors that may cause the
company's actual results and performance to be materially different
from any results or performance suggested by the statements in this
release. Such statements, and other matters addressed in this press
release, may involve a number of risks and uncertainties including
price competition, technological advances, decreased demand or
diversion to other software solutions.
Page 9 of 11
<PAGE>
CORPORATE INFORMATION
CORPORATE HEADQUARTERS
Peaksoft Multinet Corp.
1801 Roeder Avenue, Suite 144
Bellingham, Washington 98225
USA
Tel (360) 752-1100
Fax (360) 752-1110
http://www.peaksoft.com
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http://www.peak.com
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http://www.peaktrack.com
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INVESTOR INFORMATION
(888) 377-7325
STOCK LISTING
PEAKSOFT MULTINET CORP. common stock is traded on The Alberta Stock
Exchange under the symbol "PKS" and is traded on The OTC Bulletin Board (R)
(OTCBB) under the symbol "PEAMF".
AUDITOR
Gordon K.W. Gee, Ltd.
Chartered Accountant
Vancouver, B.C.
LEGAL COUNSEL
Farris, Vaughn, Wills & Murphy
Vancouver, B.C.
TRANSFER AGENT AND REGISTRAR
Montreal Trust
Calgary, Alberta
DIRECTORS MANAGEMENT
Douglas Foster Douglas Foster
Chairman of the Board President & CEO
Donald McInnes Tim Metz
Director Chief Operating Officer
Peter Janssen Calvin Patterson
Director Corporate Counsel
Simon Arnison
Director
Colin Morse
Director
Page 10 of 11
<PAGE>
PeakSoft Multinet Corp.
1801 Roeder Avenue, Suite 144
Bellingham, Washington 98225 USA
www.peak.com
Page 11 of 11
