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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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 JUNE 30, 2000
[ ] 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 000-27039
PAGEACTIVE HOLDINGS, INC.
(Exact name of small business issuer as specified in its charter)
NEVADA 88-0292249
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
318 N. CARSON STREET, SUITE 208, CARSON CITY,
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NV 89701 (Address of principal executive
offices)
(954) 474-8177
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(Issuer's telephone number)
N/A
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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 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 requirements for the past 90 days. Yes X No
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As of June 30, 2000, the number of shares of Common Stock issued and outstanding
was 19,128,920.
Transitional Small Business Disclosure Format (check one):
Yes No X
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PAGEACTIVE HOLDINGS, INC.
INDEX
<TABLE>
<CAPTION>
Page
Number
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<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets - June 30, 2000 1
Statement of Operations - For the three months and six months ended
June 30, 2000 and 1999 2
Statement of Cash Flows - For the three months and six months ended
June 30, 2000 and 1999 3
Notes to Financial Statements 4 - 6
Item 2. Management's Discussion and Analysis of Financial Conditions
and Results of Operations 7 - 8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 2. Changes in Securities 9
Item 3. Defaults Upon Senior Securities 9
Item 4. Submission of Matters to a Vote of Security Holders 9
Item 5. Other Information 9
Item 6. Exhibits and Reports on Form 8-K 9
SIGNATURES 9
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PAGEACTIVE HOLDINGS, INC.
BALANCE SHEET - JUNE 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
CURRENT ASSETS -
<S> <C>
cash $ 292,437
=================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES -
accrued expenses $ 3,524
STOCKHOLDERS' EQUITY:
Preferred stock; $0.001 par value, 10,000,000 shares
authorized, no shares issued and outstanding $ -
Common stock; $0.001 par value, 50,000,000 shares
authorized, 19,128,920 shares issued and outstanding 10,529
Additional paid in capital 432,517
Accumulated deficit (154,133)
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288,913
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$ 292,437
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See accompanying notes to unaudited financial statements.
1
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PAGEACTIVE HOLDINGS, INC.
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
2000 1999 2000 1999
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(UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ -
COST OF REVENUES - - - -
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GROSS PROFIT - - - -
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GENERAL AND ADMINISTRATIVE EXPENSES 62,583 27,500 27,709 27,500
INTEREST INCOME (7,439) (1,250) (3,555) (1,250)
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NET LOSS $ (55,144) $ (26,250) $ (24,154) $ (26,250)
============================== ===============================
WEIGHTED AVERAGE COMMON
EQUIVALENT SHARES OUTSTANDING - 19,128,920 12,138,771 19,128,920 13,512,281
============================== ===============================
NET LOSS PER SHARE, basic and diluted $ (0.003) $ (0.002) $ (0.001) $ (0.002)
============================== ===============================
</TABLE>
See accompanying notes to unaudited financial statements.
2
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PAGEACTIVE HOLDINGS, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
2000 1999 2000 1999
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(UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
CASH FLOWS PROVIDED BY (USED FOR)
OPERATING ACTIVITIES:
Net loss $ 55,144) $ (26,250) $ (24,154) $ (26,250)
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
PROVIDED BY (USED FOR) OPERATING ACTIVITIES:
Non-cash stock compensation - 20,000 - 20,000
CHANGES IN ASSETS AND LIABILITIES:
INCREASE (DECREASE) IN LIABILITIES -
accrued expenses (5,582) 5,500 - 5,500
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Total adjustments (5,582) 25,500 - 25,500
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Net cash used for operating activities (60,726) (750) 24,154) 750)
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CASH FLOWS PROVIDED BY FINANCING ACTIVITIES -
proceeds from private placement, net - 418,946 - 418,946
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NET INCREASE (DECREASE) IN CASH (60,726) 418,196 (24,154) 418,196
CASH AND EQUIVALENTS, beginning of period 353,163 - 316,591 -
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CASH AND EQUIVALENTS, end of period $ 292,437 $ 418,196 $ 292,437 $ 418,196
=============================== ===============================
</TABLE>
See accompanying notes to unaudited financial statements.
3
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PAGEACTIVE HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(1) Summary of Significant Accounting Policies:
Organization:
The Company was organized on December 18, 1992, under the laws
of the State of Nevada as The Flintlock Company. The Company
currently has no operations and in accordance with Statement
of Financial Accounting Statement No. 7, is considered a
development stage company.
On January 9, 1996, the name of the Company was changed to the
Old American Flintlock Company.
On February 11, 1998, the name of the Company was changed to
American Flintlock Company.
On May 18, 1999, the name of the Company was changed to
PageActive Holdings, Inc.
Business Activity:
The Company's plan is to seek, investigate, and if
such investigation warrants, acquire an interest in one or
more business opportunities presented to it by individuals and
other companies desiring the perceived advantages of a
publicly held corporation. As of July 28, 2000, the Company
has no plan, proposal, agreement, understanding, or
arrangement to acquire or merge with any specific business or
company, and the Company has not identified any specific
business or company for investigation and evaluation.
Use of Estimates:
The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that affect
certain 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 during the reporting period. Actual results could
differ from those estimates.
Cash:
EQUIVALENTS
For purposes of the statement of cash flows, cash
equivalents include all highly liquid debt instruments with
original maturities of three months or less which are not
securing any corporate obligations.
CONCENTRATION
The Company maintains its cash in bank deposit
accounts which, at times, may exceed federally insured limits.
The Company has not experienced any losses in such accounts.
See accompanying unaudited financial statements.
4
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PAGEACTIVE HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(1) Summary of Significant Accounting Policies, Continued:
Income Taxes:
The Company uses the liability method of accounting for income
taxes pursuant to SFAS No. 109, "Accounting for Income Taxes."
Deferred income tax assets result from temporary differences
when certain amounts are deducted for financial statement
purposes and when they are deducted for income tax purposes.
The principal temporary difference is the federal net
operating loss carryforwards, which was approximately $90,000
and immaterial at December 31, 1999 and 1998, respectively. A
deferred tax asset has been provided and is completely offset
by a valuation allowance because its utilization does not
appear to be reasonably assured. Federal net operating loss
carryforward starts to expire on December 31, 2018. In the
event of a business combination, the utilization of the
available net operating loss carryforward may be significantly
limited.
Net Loss Per Share:
The Company computes net loss per share following SFAS No.
128, "Earnings Per Share". Under the provisions of SFAS No.
128, basic net income (loss) per share is computed by dividing
the net income (loss) available to common shareholders for the
period by the weighted average number of common shares
outstanding during the period. Diluted net income (loss) per
share is computed by dividing the net income (loss) for the
period by the weighted average number of common and common
equivalent shares outstanding during the period. Common
equivalent shares are not included in the computation of
diluted loss per share for the periods presented because the
effect would be anti-dilutive.
Interim Financial Statements (Unaudited):
The accompanying unaudited condensed financial statements for
the interim periods ended June 30, 2000 and 1999 have been
prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Regulation S-B. Accordingly, they do not
include all of the information and footnotes required by
generally accepted accounting principles for complete
financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been
included. Operating results for the six months ended June 30,
2000 are not necessarily indicative of the results that may be
expected for the year ending December 31, 2000.
5
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PAGEACTIVE HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(2) Related Party Transactions:
GENERAL
The Company neither owns nor leases any real or personal property. An
officer of the corporation provides office services without charge.
Such costs are immaterial to the financial statements and accordingly,
have not been reflected therein. The officer and directors of the
Company are involved in other business activities and may, in the
future, become involved in other business opportunities. If a specific
business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interests. The Company has not formulated a policy for the resolution
of such conflicts.
EMPLOYMENT AGREEMENT
On May 20, 1999, the Company entered into an at-will employment
agreement with its officer. Pursuant to this agreement, the Company
will pay an annual salary of $60,000, payable in equal bi-weekly
installments, and also pay a reasonable monthly automobile and medical
insurance allowance. Additionally, the Company also granted 500,000
common stock options at an exercise price of $0.01 per share.
See accompanying unaudited financial statements.
6
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The discussion and financial statements contained herein are for the
three months and six months ended June 30, 2000 and 1999. The following
discussion regarding the financial statements of the Company should be read in
conjunction with the financial statements of the Company included herewith.
OVERVIEW
The Company is a development stage company as defined in Statement of
Financial Accounting Standards No. 7, "Accounting and Reporting by Development
Stage Enterprises." The Company is devoting substantially all of its present
efforts to establish a new business and its planned principal operations have
not yet commenced. All losses accumulated since inception have been considered
as part of the Company's development stage activities.
The Company has had no operations nor revenues since its inception.
(a) PLAN OF OPERATIONS
The statements contained in this section include projections of future
results and "forward-looking statements" as that term is defined in Section 27A
of the Act, and Section 21E of the Exchange Act. All statements that are
included in this Registration Statement, other than statements of historical
fact, are forward-looking statements. Although Management believes that the
expectations reflected in these forward-looking statements are reasonable, it
can give no assurance that such expectations will prove to have been correct.
Important factors that could cause actual results to differ materially from the
expectations are disclosed in this Statement, including, without limitation, in
conjunction with those forward-looking statements contained in these statements.
The primary activity of the Company currently involves seeking a
company or companies that it can acquire or with whom it can merge. The Company
has not selected any company as an acquisition target or merger partner and does
not intend to limit potential candidates to any particular field or industry,
but does retain the right to limit candidates, if it so chooses, to a particular
field or industry. The Company's plans are in the conceptual stage only. As
such, the Company can be defined as a "shell" company, whose sole purpose at
this time is to locate and consummate a merger or acquisition with a private
entity.
The proposed business activities described herein classify the Company
as a "blank check" company. Many states have enacted statutes, rules, and
regulations limiting the sale of securities of "blank check" companies in their
respective jurisdictions. Management does not intend to undertake any efforts to
cause a market to develop in the Company's securities until such time as the
Company has successfully implemented its business plan.
(b) RESULTS OF OPERATIONS
The Company has not generated any revenues and does not anticipate
generating any material revenues in the near future. Currently, the Company's
only cash requirements are for rent, salaries, accounting and legal. The
Company's sole source of capital has been investment capital provided by third
parties.
The following table sets forth, for the periods indicated, selected financial
information for the Company:
7
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<TABLE>
<CAPTION>
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SIX MONTHS THREE MONTHS ENDED
ENDED JUNE 30 JUNE 30
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2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Net revenues $ - $ - $ - $ -
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Cost of revenues $ - $ - $ - $ -
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Gross profit $ - $ - $ - $ -
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General and administrative expenses $ 62,583 $ 27,500 $ 27,709 $ 27,500
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Net Income/(loss) $ (55,144) $ (26,250) $ (24,154) $ (26,250)
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Net Income/(loss) per share $ (0.003) $ (0.002) $ (0.001) $ (0.002)
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Weighted average shares outstanding 19,128,920 12,138,771 19,128,920 13,512,281
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</TABLE>
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2000 AS COMPARED TO THREE MONTHS AND
SIX MONTHS ENDED JUNE 30, 1999
REVENUES.
The Company had no revenues for either the three month and six month
period ended June 30, 2000 or the three month and six month period ended June
30, 1999.
GENERAL, ADMINISTRATIVE, AND SELLING EXPENSES.
The Company incurred costs of $27,709 for the quarter ended June 30,
2000 as compared to $27,500 for the quarter ended June 30, 1999. Operating
expenses were $62,583 for the six months ended June 30, 2000 as compared to
$27,500 for the six months ended June 30, 1999.
NET LOSS
The Company had a net loss of $24,154 for the quarter ended June 30,
2000 as compared a net loss of $26,250 for the quarter ended June 30, 1999. The
net loss for the six months ended June 30, 2000 was $55,144 as compared to a net
loss of $26,250 for the six months ended June 30, 1999.
LIQUIDITY AND CAPITAL RESOURCES
In May 1999, the Company raised $418,946 through the private sale of
the 8,378,920 shares to one entity at a purchase price of $0.05 per share. This
private offering is exempt from the registration requirements of the Act
pursuant to Section 4(2) of the Act.
The Company will need to raise additional capital in the next twelve
months to support its operations. This capital may be raised privately or
publicly. As of the date of this document, the Company has no commitments for
raising additional financing.
At June 30, 2000, the Company had outstanding current liabilities of
$3,524, consisting of accrued expenses.
The Company does not believe that inflation has had a significant
impact on its operations since inception of the Company.
PART II - OTHER INFORMATION
8
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ITEM 1. LEGAL PROCEEDINGS
To the best knowledge of management, there is no material
litigation pending or threatened against the Company.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
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
The following documents are filed as part of this report:
1. The following Exhibits are filed herein: 27.1 Financial Data
Schedule
2. Reports on Form 8-K filed: None
SIGNATURES
In accordance with the Exchange Act, the registrant caused this report
to be signed on its behalf by the undersigned, duly authorized.
PAGEACTIVE HOLDINGS, INC.
DATED: August 3, 2000 /s/ Earl T. Shannon
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By: Earl T. Shannon
Its: President, Secretary, Treasurer
and Director
9
