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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000
Commission file number 000-24927
X-Ramp.com, Inc.
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(Exact Name of Small Business as Specified In Its Charter)
Nevada 33-0199082
(State of Incorporation or Organization) (I.R.S.Employer Identification No.)
2100 First Federal Plaza
Rochester, New York 14614
(Address of Principal Executive Offices)
(800) 819-9653
(Issuer's Telephone Number, including Area Code)
Classified Online.com
1839 S. E. Port Saint Lucie Boulevard
Port St. Lucie, Florida 34952
(Former Name and Former Address 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 past12 months and (2) has been
subject to such filing requirements for the past 90 days. Yes X No__
The number of shares outstanding of the issuer's Common Stock, as of
september 30, 2000: 10,319,997.
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X-RAMP.COM, INC.
(FORMERLY CLASSIFIED ONLINE.COM)
(A DEVELOPMENT STAGE ENTERPRISE)
Condensed Consolidated Balance Sheet
September 30,
ASSETS 2000
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Current assets:
Cash and cash equivalents $ 7,679
Accounts receivable -
Prepaid expenses 4,388
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Total current assets 12,067
Other assets 19,194
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$ 31,261
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Notes payable to stockholders 65,017
Accounts payable and accrued expenses 287,247
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Total current liabilities 352,264
Stockholders' equity (deficit):
Preferred stock, $.01 par value, authorized 20,000,000
shares, none issued and outstanding -
Common stock, $.001 par value, authorized 50,000,000
shares, issued 10,319,997 shares 10,320
Additional paid-in capital 389,885
Deficit accumulated during development stage (680,695)
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(280,490)
Less treasury stock, 46,300 common shares, at cost (40,513)
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Total stockholders' equity (deficit) (321,003)
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$ 31,261
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See accompanying notes to condensed consolidated financial statements.
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<TABLE>
X-RAMP.COM, INC.
(FORMERLY CLASSIFIED ONLINE.COM)
(A DEVELOPMENT STAGE ENTERPRISE)
Condensed Consolidated Statements of Operations
<CAPTION>
Period from February 9,
Three Months Ended Nine Months Ended 1999 (Inception) Through
------------------ ----------------- ------------------------
September 30, September 30, September 30, September 30, September 30,
2000 1999 2000 1999 2000
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net sales $ 46 $ - $ 442 $ - $ 644
------------- ------------- ------------- ------------- -------------
Expenses:
General and administrative 50,747 22,698 152,767 169,394 334,000
Consulting and professional 61,635 - 134,329 20,000 316,072
Equipment rental - - 7,667 - 18,429
Other 4,745 - 7,581 - 12,838
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Total expenses 117,127 22,698 302,344 189,394 681,339
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Loss before income taxes (117,081) (22,698) (301,902) (189,394) (680,695)
Income taxes - - - - -
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Net loss $ (117,081) $ (22,698) $ (301,902) $ (189,394) $ (680,695)
============= ============= ============= ============= =============
Basic loss per common share $ (0.01) $ (0.00) $ (0.03) $ (0.02) $ (0.07)
============= ============= ============= ============= =============
Weighted average shares outstanding 10,048,258 9,688,033 10,021,183 8,717,783 9,508,580
============= ============= ============= ============= =============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
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<TABLE>
X-RAMP.COM, INC.
(FORMERLY CLASSIFIED ONLINE.COM)
(A DEVELOPMENT STAGE ENTERPRISE)
Condensed Consolidated Statements of Cash Flows
<CAPTION>
Period from February 9,
Nine Months Ended 1999 (Inception) Through
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September 30, September 30, September 30,
2000 1999 2000
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<S> <C> <C> <C>
Cash flows from operating activities:
Reconciliation of net loss to net cash provided by
operating activities:
Net loss $(301,902) $(189,394) $(680,695)
Adjustments to reconcile net loss to net cash
provided by operating activities:
General, administrative, and consulting expenses
compensated through the issuance of common stock - 161,694 359,381
(Increase) decrease in accounts receivable 202 - -
(Increase) decrease in prepaid expenses and other
assets 51,551 (26,772) (23,582)
Increase in accounts payable and accrued expenses 232,407 54,956 327,574
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Total adjustments 284,160 189,878 663,373
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Net cash provided (used) by operating activities (17,742) 484 (17,322)
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Cash flows from investing activities - - -
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Cash flows from financing activities:
Proceeds from the issuance of common stock 25,001 - 25,001
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Net cash provided by financing activities 25,001 - 25,001
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Net change in cash and cash equivalents 7,259 484 7,679
Cash and cash equivalents at beginning of period 420 - -
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Cash and cash equivalents at end of period $ 7,679 $ 484 $ 7,679
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</TABLE>
Supplemental schedule of non-cash investing and financing activities:
On May 5, 2000, the Company reclassified certain accounts payable to
stockholders and an affiliate of a stockholder amounting to $65,017 to notes
payable.
See accompanying notes to condensed consolidated financial statements.
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X-RAMP.COM, INC.
(FORMERLY CLASSIFIED ONLINE.COM)
(A DEVELOPMENT STAGE ENTERPRISE)
Notes to Condensed Consolidated Financial Statements
September 30, 2000
(1) DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) BUSINESS
X-Ramp.com, Inc. (formerly Classified OnLine.Com) (the Company),
a development stage enterprise, was organized and incorporated
under the laws of the State of Nevada on February 9, 1999 for
the purpose of designing, developing, and marketing an
internet-based classified advertising web-site. On April 19,
2000, the Company changed its name from Classified OnLine.Com to
X-Ramp.com, Inc. On May 24, 2000, the Company formed a new
wholly-owned subsidiary, Classified OnLine.com, Inc. The Company
expects to commence operations during the year 2000.
On January 24, 2000, the Company formed a new wholly-owned
subsidiary, SafeVenture.Com, in the state of Nevada for the
purpose of designing, developing, and marketing an
internet-based escrow transaction service. The Company
anticipates commencing operations during the year 2000.
As of September 30, 2000, the Company was in the development
stage and had not begun its operations and had no significant
sources of revenue. Management intends to fund future
development activities through funding from its principal
stockholders and officers or through the issuance of capital.
The Company's ability to continue as a going concern is
dependent upon the development of revenue sources sufficient to
fund operations and the Company's ability to issue new capital.
(B) PRESENTATION
The Company's financial statements include the accounts of the
Company and its wholly-owned subsidiaries, Classified
OnLine.com, Inc., WantToBuyOnline.Com and SafeVenture.Com. All
significant intercompany balances and transactions have been
eliminated in consolidation.
In the opinion of management, the unaudited financial statements
contain all adjustments necessary to present fairly the
Company's financial position as of September 30, 2000 and the
results of operations and cash flows for the three months and
nine months ended September 30, 2000 and for the period from
February 9, 1999 (inception) through September 30, 2000 and
1999. The accompanying interim financial statements should be
read in conjunction with the Company's Form 10-KSB filing for
the period ended December 31, 1999.
(C) LOSS PER SHARE
Earnings per share is accounted for by using the basic and
diluted earnings per share method prescribed by SFAS No. 128.
Basic loss per share is based on the weighted average number of
shares of common stock outstanding during the period. Diluted
loss per share is based on shares of common stock and dilutive
potential common stock (stock options) outstanding during the
period. Diluted loss per share was antidilutive due to the net
loss generated by the Company during the periods ended September
30, 2000 and 1999 and is therefore not reported.
(Continued)
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X-RAMP.COM, INC.
(FORMERLY CLASSIFIED ONLINE.COM
(A DEVELOPMENT STAGE ENTERPRISE)
Notes to Condensed Consolidated Financial Statements
(D) COMPREHENSIVE INCOME
The FASB has issued Statement No. 130, REPORTING COMPREHENSIVE
INCOME (Statement 130), which establishes standards for
reporting and display of comprehensive income and its components
in a financial statement having the same prominence as other
consolidated financial statements. As of September 30, 2000, the
Company had no components considered to be other comprehensive
income.
(2) STOCKHOLDERS' EQUITY
On September 18, 2000, the Company issued 312,500 shares of restricted
common stock. Total proceeds amounted to $25,001, or approximately $0.08
per share.
(3) RELATED PARTY TRANSACTIONS
During the nine months ended September 30, 2000 and the period from
February 9, 1999 (inception) through December 31, 1999, a portion of the
Company's operating expenses were funded by the Company's president,
vice-president, and certain stockholders. On May 5, 2000, amounts payable
to certain stockholders totaling $55,845 were transferred to notes
payable, bearing interest at 10% and due on June 30, 2000. In addition,
as of June 30, 2000, the Company owed the officers and the stockholders
amounts totaling $23,053 for reimbursement of such expenses.
During the period from February 9, 1999 (inception) through June 30,
2000, certain expenses totaling $9,172 were funded by an affiliate of the
Company's former president. On May 5, 2000, the Company transferred the
balance of $9,172 to a note payable, bearing interest at 10% and due on
June 30, 2000.
As of September 30, 2000, amounts due the former president under notes
payable totaling $65,017 remained outstanding. See note 4 for further
discussion.
(4) CONTINGENCIES
The Company is involved in various claims and legal actions, as discussed
below, arising in the normal course of business, the ultimate disposition
or damages of which, if any, are not presently determinable.
On August 21 , 2000, A former officer of the company commenced an action
against various defendants, including the company, certain directors, and
the companies former president, seeking compensatory and punitive damages
to be determined at trial relating to company stock transferred to the
plaintiff's former wife. The outcome and merits are not determinable at
this time. Settlement discussions are continuing and the company has been
given an indefinite extension in which to answer the complaint.
The companies former President and director commenced a lawsuit on
September 13, 2000, against the company for $65,017, alleging the company
failed to timely pay certain promissory notes he signed on behalf of the
company to himself and his affiliates. The company believes the claims to
be without merit and has filed a motion to dismiss the action. The
company believes it also has substantial counterclaims against the former
president.
(5) SUBSEQUENT EVENTS
During October and November, 2000, the Company entered into employment
agreements with certain employees that provides, among other provisions,
stock options to purchase an aggregate of 420,000 shares of common stock
at $0.08 per share. The stock options vest as follows: 84,000 on December
31, 2001; 84,000 on December 31, 2002; and 252,000 on December 31, 2003.
All options terminate on January 5, 2010, unless the employees terminate
employment, at which point all unexercised options terminate if the
employee terminates within the first year of the date of grant, or the
unexercised options terminate sixty days after employment is terminated
if the employee terminates after the first year of such grant. All
options vest immediately upon the sale of the Company, or upon completion
of a public offering.
On November 9, 2000, the Company issued 400,000 shares of restricted
common stock to a firm engaged to perform various business advisory
services. The services will be performed over a one-year period and are
valued at $32,000. In addition, the Company has agreed to pay the firm
fees equal to two and one-half percent of any proceeds received by the
Company from the sale of common stock to a party identified by the
advisory firm.
On November 15, 2000, the Company issued 75,000 shares of restricted
common stock in exchange for marketing services valued at $37,500. Such
services had been provided to the Company during a portion of 1999 and
2000, for which accrued expenses was included in the accompanying
condensed consolidated balance sheet as of September 30, 2000.
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PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
The information required by Item 310(b) of Regulation S-B is set forth as an
Exhibit 1 hereto and is incorporated herein by reference.
Item 2. Management's Discussion and Analysis or Plan of Operation
The Company has not had meaningful revenues from operations in each of the last
two fiscal years and is currently in the process of developing a plan of
operation for the next twelve months. The Company intends to generally move
forward in implementing its previously announced goal of seeking strategic
alliances as well as targeting companies for possible mergers and acquisitions.
The Company can satisfy its minimal cash requirements indefinitely through
advances and short-term loans by its officers and directors or through private
placement of the Company's authorized but unissued Common Stock. The Company has
no employees as of the date hereof.
PART II
OTHER INFORMATION
Item 1. Legal proceedings
The Company is involved in various claims and legal actions arising in the
normal course of business, the ultimate disposition or damages of which, if any,
are not presently determinable.
Additionally, a former officer of the Company, Barry Raphael, commenced an
action on August 21, 2000 against his former wife, Diane Maureen Raposo, former
Board members of the Company, Rick Oldfield, Steve Hocke, Alan Kipnis, and Steve
Tierney, as well as the Company inthe Superior Court of the State of California,
County of Los Angeles, Central Judicial District, seeking compensatory and
punitive damages to be determined at trial relating to Company stock transfered
to Ms. Raposo. The outcome and merits are not determinable at this time. Mr.
Raphael has offered to settle the matter with respect to the company and the
Company has been given an indefinite extension in which to answer.
The Company's former president and director, Richard Oldfield commenced a
lawsuit on September 13, 2000 against the Company in the Circuit Court of the
19th Judicial Circuit in and for St. Lucie County Florida for $65,017.05,
alleging the Company failed to timely pay certain promissory notes he signed on
behalf of the Company to himself, a female friend, and a corporation he owned.
The Company believes the claims to be without merit and has filed a motion to
dismiss the action. The the Company believes it also has substantial
counterclaims against Mr. Oldfield.
See accompanying notes to consolidated financial statements.
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Item 5. Other Information
On July 31, 2000, Michael Gilbert was appointed a Director of the Company,
replacing Richard J. Oldfield who had previously resigned.
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits required by Item 601 of Regulation S-B.
Index of Exhibits
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(3 (i)) Articles of Incorporation (incorporated by reference
from the Company's Amended Form 10-SB, filed May 10, 1999).
(3(ii)) By-laws (incorporated by reference from the Company's
Amended Form 10-SB, filed May 10, 1999).
b) Reports on Form 8-K. None filed during the quarter for which this
report is filed.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has duly
caused this Report to be signed on its behalf by the undersigned, thereunto duly
authorized.
X-Ramp.com, Inc.
Date: November 20, 2000 By: /s/ Michael J. Lates
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Michael J. Lates, President
