U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period 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
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Commission File No. 000-29994
ANYTHING INTERNET CORPORATION
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(Exact name of Registrant as specified in its charter)
Colorado 84-1425882
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(State or other jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
3020 North El Paso, Ste. 103, Colorado Springs, Colorado 80907
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(Address of Principal Executive offices)
(719) 227-1903
--------------
(Issuer's telephone number)
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
------- -------
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Class Outstanding at May 13, 2000
----- -------------------------------
Common Stock, no par value 2,443,802
Convertible Class A Preferred, no par value 1,106,154
Transitional Small Business Disclosure Form (check one):
Yes No X
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<PAGE>
ANYTHING INTERNET CORPORATION
TABLE OF CONTENTS
FORM 10-QSB
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements, Unaudited
Unaudited Consolidated Balance Sheets
at March 31, 2000 and March 31, 1999
Unaudited Consolidated Statement of Operations
for the three months ended March 31, 2000 and 1999
Unaudited Consolidated Statement of Cash Flow for the
three months ended March 31, 2000 and 1999
Notes to Unaudited Consolidated Financial Statements
Item 2. Management's Discussion and Analysis or
Plan of Operation
PART II
OTHER INFORMATION
Item 3. Changes in Securities and Use of Proceeds
Item 4 Subsequent Events
Item 5. Submission of Matters to a Vote of Security Holders
Item 6. Exhibits and Reports on Form 8-K
Signatures
Exhibits
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
ANYTHING INTERNET CORPORATION
CONSOLIDATED BALANCE SHEET
ASSETS
March 31, March 31,
2000 1999
(unaudited) (unaudited)
------------ ------------
<S> <C> <C>
Current assets:
Cash $ 479,942 $ 18,974
Accounts receivable 7,061 48,137
Note Receivable -0- 90,407
Inventory -0- 60,647
Prepaid expenses and other current assets 38,000 16,730
------------ ------------
525,003 234,895
------------ ------------
Furniture and fixtures:
Office furniture and equipment 70,369 58,671
Less accumulated depreciation (28,510) (10,619)
------------ ------------
42,219 48,052
------------ ------------
Other assets:
Software development costs, less
Accumulated amortization of
$32,813 and $14,882, respectively 42,276 39,244
Note receivable -0- 86,023
Deposits 1,280 2,741
------------ ------------
43,556 128,008
------------ ------------
$ 610,778 $ 410,955
============ ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANYTHING INTERNET CORPORATION
CONSOLIDATED BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' DEFICIT
March 31, March 31,
2000 1999
(unaudited) (unaudited)
---------------- ------------
<S> <C> <C>
Current liabilities:
Accounts payable $ 432,837 $ 311,168
Accrued expenses 6,363 36,231
Notes payable - line of credit 46,780 32,135
Notes payable - related party -0- -0-
Prepaid sales -0- 6,145
---------------- ------------
485,980 385,679
---------------- ------------
Stockholders' equity:
Convertible Preferred Stock, Class A,
No par value; 10,000,000 shares authorized;
1,106,716 and no shares issued
and outstanding, respectively 488,355 -0-
Common stock, Class A, no par value;
50,000,000 shares authorized;
2,404,046 and 3,074,400 issued
and outstanding, respectively 1,488,776 427,900
Common stock subscribed (27,500 shares) 55,000 0
Stock subscription receivable (55,000) 0
Accumulated deficit (1,852,333) (402,624)
---------------- ------------
124,798 25,276
---------------- ------------
$ 610,778 $ 410,955
================ ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANYTHING INTERNET CORPORATION
STATEMENT OF OPERATIONS
(unaudited)
- Nine Months Ending -
Three Months
Ending
March 31, March 31, March 31,
2000 2000 1999
-------------- --------------- ---------------
<S> <C> <C> <C>
Sales $ 4,808 $ 588,436 $ 2,403,629
Cost of sales 2,994 596,016 2,311,403
-------------- --------------- ---------------
Gross profit 1,814 (7,580) 92,226
Selling, general and
administrative expenses 416,484 1,200,418 470,087
(Loss) from operations (414,670) (1,207,998) (377,861)
Other income (expense):
Interest Income 1,425 1,425 -0-
Bad debt write-off -0- (14,167) -0-
Interest expense (7,618) (15,143) -0-
Income (loss) before provision for
income taxes (420,863) (1,235,883) (377,861)
Provision for income tax - - -
Net income (loss) (420,863) (1,235,883) (377,861)
============== =============== ===============
Net income (loss) per share
(basic and fully diluted) ($0.17) ($0.45) ($0.12)
============== =============== ===============
Weighted average number of common
shares outstanding 2,362,941 2,739,601 3,074,400
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANYTHING INTERNET CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
- Nine Months Ending -
March 31, March 31,
2000 1999
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<S> <C> <C>
Cash flows from operating
activities:
Net operating deficit ($1,235,883) ($377,861)
Adjustments to
Reconcile net loss to
Net cash provided:
Depreciation and
Amortization expense 8,861 18,521
Net changes in
Operating assets
And liabilities:
Accounts receivable 181,628 (124,054)
Inventories 12,277 -0-
Deposits 1,461 (1,361)
Other assets 3,938 (77,277)
Prepaid expenses (29,909) -0-
Notes receivable 18,023 (18,023)
Accounts payable
and accrued
expenses (14,361) 355,980
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Net cash used by
Operations (1,053,965) (224,075)
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Cash flow from investment
Activities:
Acquisition of office
Equipment (7,207) (44,211)
Software development
Costs incurred (17,450) (28,054)
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Net cash used by
Investment activities (24,657) (72,265)
Cash flow from financing
Activities:
Proceeds from borrowing 50,000 -0-
Bank reserve 41,965 -0-
Loan repayments (79,325) (40,000)
Sale of stock 1,426,591 200,000
Stock issued in liew
of cash 117,879 113,200
Net cash used by ------------- ------------
Financing activities 1,557,110 273,200
Net increase (decrease)
in cash 478,488 (23,140)
Cash at beginning of the
Period 1,454 42,114
------------- ------------
Cash at end of the period $ 479,942 $ 18,974
============= ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Anything Internet Corporation
Consolidated Statement of Stockholders' Equity
For the Period From January1, 2000 to March 31, 2000
(Unaudited)
Common Stock Subscribed
Common Stock Preferred Stock --------------------------------
Class A Class A Stock Stock-
Number Number Subscription Number Accumulated Holders'
of Shares Amount of Shares Amount Receivable of Shares Amounts Deficit Equity
---------- ----------- --------- -------- ------------ --------- -------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December
31, 1999 2,321,079 $ 511,360 761,173 $372,840 $ (55,000) 27,500 $ 55,000 $(1,431,471) $(547,271)
Purchase of stock
Warrants 5,000 15,000 15,000
Purchase of stock
Options 440,000 440,000 440,000
Issuance for services
(Bernard Sandovall) 10,000 10,000 10,000
Purchase of stock
Options 50,000 50,000 50,000
Purchase of stock
Warrants 5,000 15,000 15,000
Purchase of stock
Warrants 5,000 15,000 15,000
Issuance for services
(Mull & Paige) 80,000 80,000 80,000
Purchase of stock
Warrants 50,000 150,000 150,000
Issuance for services
(William Kroske) 9,934 9,934 9,954
Issuance for services
(Chirsta Dunn) 3,000 3,000 3,000
Issuance for services
(Thomas O'Hara) 20,000 20,000 20,000
Issuance for services
(Catherine Hickman) 5,000 5,000 5,000
Purchase of stock 40,000 120,000 120,000
Warrants
Purchase of stock 50,000 150,000 150,000
Warrants
Purchase of stock
Preferred stock 5,000 10,000
Purchase of stock
subscriptions 0 0 0 0 0 0
Retirement of common
shares and issuance of
preferred shares in
tender offer (689,962) (115,578) 339,981 105,578 -
Net loss for period (420,863) (420,863)
---------- ----------- --------- -------- ------------ --------- -------- ------------ ----------
Balance at
March 31, 2000 1,905,846 $1,4887763 1,106,154 $488,353 $ (55,000) 27,500 $ 55,000 $(1,852,334) $ 124,798
========== =========== ========= ======== ============ ========= ======== ============ ==========
</TABLE>
<PAGE>
ANYTHING INTERNET CORPORATION
NOTES TO FINANCIAL STATEMENTS
(unaudited)
For the period from January 1, 2000 to March 31, 2000
NOTE 1: BASIS OF PRESENTATION:
The accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-QSB and do not include all of the information
and disclosures required by generally accepted accounting principles for
complete financial statements. All adjustments which are, in the opinion of
management, necessary for a fair presentation of the results of operations for
the interim periods have been made and are of a recurring nature unless
otherwise disclosed herein. The results of operations for such interim periods
are not necessarily indicative of operations for a full year.
NOTE 2: ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES:
Anything Internet Corporation ('Anything Internet", the "Company"), was
incorporated in the State of Colorado on August 15, 1997. The Company markets
and distributes computers and related accessory products by using the Internet
as the exclusive distribution channel. On August 28, 1998, Anything, Inc.
changed its name to Anything Internet Corporation, which was made effective
through an amendment to its Articles of Incorporation filed with the Secretary
of State of Colorado on August 31, 1998.
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 revenue and expenses during the reporting period. Actual
results could differ from those estimates.
Income tax
Deferred taxes are provided on a liability method whereby deferred tax assets
are recognized for deductible temporary differences and operating loss
carryforwards and deferred tax liabilities are recognized for taxable temporary
differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effects of
changes in tax laws and rates on the date of enactment.
Cash and cash equivalents
The Company considers all highly liquid investments with an original maturity of
three months or less as cash equivalents.
<PAGE>
Net income (loss) per share
The net income (loss) per share is computed by dividing the net income (loss) by
the weighted average number of shares of common outstanding. Warrants, stock
options, and common stock issuable upon conversion of the Company's preferred
stock are not included in the computation if the effect of such inclusion would
be anti-dilutive and would increase the earnings or decrease loss per share.
Inventory
Inventory consists of consigned finished goods. Inventories are valued at the
lower of cost or market using the first-in, first-out (FIFO) method.
Property and equipment
Property and equipment are recorded at cost and depreciated under accelerated
methods over an estimated life of five to seven years.
Software development costs
It is the Company's policy to capitalize major software development activities
to reflect the value of the software over its anticipated useful life. The
Company amortizes this software over a three year period from the implementation
of the software.
Accounts receivable
The Company reviews accounts receivable periodically for collectability and
establishes an allowance for doubtful accounts and records bad debt expense when
deemed necessary.
Products and services, geographic areas and major customers
Company sales were derived from marketing and distributing computers and related
products over the Internet, were to external customers, and were domestic. The
Company had no one major customer accounting for over 10% of its sales. The
Company's long term assets are all held domestically.
Revenue Recognition
The Company recognizes revenue when a product is shipped to customers either
from the Company's inventory or when shipped from distributors' warehouses
directly to the customer. The Company assumes title to the product when it is
shipped either to the Company or directly to the Company's customer.
NOTE 3. RELATED PARTY TRANSACTIONS
On December 31, 1998 the Company loaned Robert C. Schick, an officer, $18,023 at
a rate of 3% per annum. The note matures and is payable in full on December 31,
1999. The loan was repaid in February 2000.
On June 16, 1999, the Company borrowed $75,000 from a related corporation with
an ownership interest in Anything Internet Corporation. The short-term loan was
made at a rate of 12% per annum, and comes due July 30, 2000. The loan was
repaid in March 2000.
<PAGE>
NOTE 4. LEASE COMMITMENT
Effective June 3, 1999, the Company extended its lease agreement for office
space in Colorado Springs, Colorado, and effective March, 1999, entered into a
lease agreement for office space in Tampa, Florida. The Tampa lease expired and
the Company did not renew its lease and closed the office. Both leases are for a
period of twelve-months and can be renewed at terms and conditions to be
established at expiration date. Lease expense incurred for the nine ended March
31, 2000 was approximately $18,187. The remaining minimum future rental
payments, all in 2000, are $13,567.
NOTE 5. LINES OF CREDIT
The Company has also established a $50,000 line of credit with US Bank of
Colorado Springs, Colorado. Payments are due on the 15th of each month and
interest accrues at the rate of 10.45% per annum. At March 31, 2000 the
Company's outstanding balance on this credit line was $46,780.
NOTE 6. INCOME TAXES
Deferred income taxes arise from the temporary differences between financial
statement and income tax recognition of net operating losses. These loss
carryovers are limited under the Internal Revenue Code should a significant
change in ownership occur.
At March 31, 2000 the Company had approximately $1,855,000 of unused federal net
operating loss carryforwards, which begin to expire in the year 2019. A deferred
tax asset has been offset by 100% valuation allowance. The Company accounts for
income taxes pursuant to SPAS 109. The components of the Company's assets and
liabilities as follows:
<TABLE>
<CAPTION>
March 31,2000 March 31, 1999
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<S> <C> <C>
Deferred tax liability $ - $ -
Deferred tax asset arising from:
Net operating loss carryforwards 723,450 55,290
----------------- ------------------
723,450 55,290
Valuation allowance (723,450) (55,290)
----------------- ------------------
Net Deferred Taxes $ 0 - $ -
The income tax (benefit) consists of the following:
Current:
Federal $ - $ -
State - -
----------------- ------------------
Deferred:
Federal ($630,700) ($50,412)
State (92,750) (4,878)
----------- ---------
($723,450) ($55,290)
</TABLE>
<PAGE>
NOTE 7. STOCKHOLDERS' EQUITY
Common stock
The Company as of March 31, 2000 had 50,000,000 shares of authorized common
stock, no par value, with 2,404,046 shares issued and outstanding.
In May, 1998 an officer provided the company with $1,400 in cash and web page
design and development valued at $16,600. In August, 1998 the Company exchanged
1,950 shares of common stock for debt cancellation by an officer in the amount
of $10,500. Later in August, 1998, the Company retired all its 7,750 currently
outstanding shares, in addition to 4,200 retired earlier in the year, in
exchange for 500,000 shares of new Class A common stock. Also in August, 1998,
the Company purchased 200,000 Class A common shares of Banyan Corporation valued
at $40,000 in exchange for 1,000,000 Class A common shares of the Company. In
addition the Company issued 1,300,000 shares of Class A common stock for
management consulting, legal and investor relations services valued at $52,000
to parties unrelated to the Company or Banyan Corporation. In September, 1998,
the Company issued to the members of its Board of Directors 20,000 shares of
Class A common stock for services. In December, 1998 and January, 1999 the
Company sold 200,000 shares of Class A common stock for $200,000 in a private
placement. In January, 1999 the Company issued 20,400 common shares to directors
and others for compensation valued at $20,400. In November 1999 the Company
issued 291,300 shares to new officers, consultants and the new board of
directors for their services to implement the new business plan. In January 2000
the company sold 500,000 shares at $ 1.00 per share as part of the stock options
granted on February 28, 1998.
Warrants
As of March 31, 2000, the Company had 39,000 of 200,000 authorized Common Stock
Purchase Warrants outstanding (the 'Warrants'), issued in conjunction with a
private placement completed in January, 1999. Each Warrant entitles the holder
to purchase one share of the Company's Class A common stock at an exercise price
of $3.00 per share through April 24, 2000, at which time the Warrants expire.
The Company may redeem the Warrants at a price of $0.01 per Warrant, at any time
through April 24, 2000 upon not less than 30 days, nor more than 60 days, prior
written notice, provided that the closing bid quotation for the common stock as
reported by any quotation service on which the common stock is quoted is at
least $4.00 for ten consecutive trading sessions ending on the two days prior to
the day on which notice is given. During the first three-quarters, 161,000 have
been paid for and issued. On January 21, 2000 the board of directors voted to
extend the Warrants ninety days. The remaining 39,000 shares were exercised
during April, 2000.
Stock options
As of March 31, 2000, the Company made a stock option award to directors and
others and adopted an employee stock benefit plan, which are described below.
The Company applies ADS Opinion 25 and related Interpretations in accounting for
stock options.
Accordingly, no compensation cost has been recognized for its stock option award
to directors and its employee stock benefit plan, nor was any compensation cost
charged against income under the award or plan in 1999. Had compensation cost
for the Company's stock option award and employee stock benefit plan been
determined based on the fair value at The grant dates for awards under the stock
option award and employee stock benefit plan consistent with the method of FASS
Statement 123, the Company's net income and earnings per share would have been
reduced to the pro forma amounts indicated below:
<PAGE>
1999
----
Net income (loss) As reported ($1,235,883)
Pro forma ($2,151,583)
Basic and fully diluted earnings per share
As reported ($0.45)
Pro form ($0.78)
Stock option award
In August, 1998, the Company granted stock options, exercisable immediately
(except as noted below), to certain officers and directors as compensation for
services, to purchase common shares of the Company as follows:
Amount Price/Share Expiration Date
50,000 $40 April 1, 2002
25,000 $75 April 1, 2002
25,000 $100 April 1, 2002
*10,000 $3 March 31, 2003
70,000 $1 January 6, 2001
700,000 $1 October 20, 2002
#36,000 $1 November 23, 2001
*35,000 $1 November 23, 2004
* Option vests over 3 years.
# Option vests over 3 months
Employee stock option plan
On June 4, 1999 the Company awarded stock options to four employees under an
employee stock option plan. 200,000 common shares were reserved under the plan,
which expires in June, 2007. Each employee received options to purchase 2,500
common shares (10,000 shares total). The options vest at 500 shares per year
per employee, beginning June 4, 2000, at an exercise price of $3 per share.
<PAGE>
A summary of the status of the Company's stock options as of March 31, 2000, and
changes during the year ending on that date is presented below:
March 31, 2000
---------------------------
Weighted Avg.
Options Shares Exercise Price
------- ---------- --------------
Outstanding at beginning of period 1,720,000 $4 67
Granted 41,000 $1.22
Exercised (500,000) $1.00
Forfeited (300,000) $1.00
---------- ------
Outstanding at end of period 961,000 $7.62
Options exercisable at period end 954,333 $7.65
Weighted average fair value of
Options granted during the period
Period $1.22
The following table summarizes information about stock options outstanding at
March 31, 2000.
<TABLE>
<CAPTION>
Options Outstanding Options Exercisable
------------------- -------------------
Weighted Avg. Weighted Weighted
Range of Number Remaining Avg. Number Avg.
Exercise Outstanding Contractual Exercise Exercisable Exercise
Prices at 03/31/00 Life Price at 03/31/00 Price
- ------------- ------------- ------------ --------- ----------- --------
<S> <C> <C> <C> <C> <C>
1.00-$100.00 961,000 21.25 months $ 7.62 954,333 $ 7.65
</TABLE>
Item 2. Management's Discussion and Analysis or Plan of Operation
Results of Operations
Three Months Ending March 31, 2000
The Company underwent a top-to-bottom review of its business plan during the
fiscal quarter ending December 31, 1999. Afterwards it began implementing
significant changes to its business model and management team.
During the period ending March 31, 2000 one officer an resigned, Robert A Schick
resigned as Chief Technical Officer and as director to pursue other
opportunities.
The Company hired Larry Arnold as President and Chief Operating Officer in March
of 2000.
Under the guidance of new management, the Company discontinued conducting
business as a low-cost, low-margin Internet retailer to focus on higher margin
products. As a result, revenues to decline substantially during this
transitional quarter to $4,808. Gross profits were $2,994, and a gross margin of
37.7%. The Company began development on a new web portal site,
<PAGE>
www.anyreminder.com, which was introduced in late January 2000. The site has
continued to be developed and bring in members. The Company also began
construction of its business to business site and announced the launch of that
site on May 2, 2000. In conjunction with the development of the business to
business site the Company signed a joint marketing agreement with the Sportsman
Guide, Inc. on March 31, 2000.
The new web portal is a free reminder service offered to all Internet users that
allows members to enter a variety of dates (ie. birthdays, anniversaries,
weddings). When a key date approaches, the member will automatically receive an
e-mail to remind them of the pending date and give them some suggestive gifts
that would be appropriate for the occasion.
The value of the new portal is in its low-cost ability to rapidly grow the
Company's customer database and respective demographic data. The database will
not be sold or "spammed" but used to further the Company's own high-margin
e-commerce efforts. The cost of building a customer database through offering
free service is substantially less than those previously implemented in the
Company's e-commerce efforts, plus it gives the Company the ability to generate
significant advertising revenue.
Nine Months Ending March 31, 2000 Compared to Nine Months Ending March 31, 1999
Net sales for the period ending March 31, 2000 were 584,436, a decrease of 74.4%
over $2,403,629 for the same period a year ago. All of these sales were a
result of sales generated primarily through the Company's Internet storefronts
AnythingPC.com, AnythingMAC.com, AnythingUNIX.com and AnythingCoffee.com. The
decrease in sales was the result of the Company significantly altering its
business model and commencing those changes.
Gross profits for the period ending March 31, 2000 were (7,580). This represents
an decrease in gross profits of 106.1% over $92,226 for the same period a year
ago. Gross profit margins decreased from 3.84% of sales to (1.29%) of sales as
a result of rapidly decreasing gross profit margins for non-specialty Internet
retailers.
Selling, general and administrative (SG&A) expenses for the period ending March
31, 2000 were $1,200,418 which represents a 255% increase from $ 470,087 for the
same period a year ago. Of these expenses, $966,260, or 81%, were accrued during
the fiscal quarters ending December 31, 1999 & March 31, 2000 as a result of
changes made in the Company's business model and expenses incurred for
implementing these changes and developing the Company's new web portal,
www.anyreminder.com.
The net loss for the period ending March 31, 2000 amounted to ($1,235,883), or
($0.45) a share. This represents and increase of 327% compared to ($377,861),
or ($.12) a share, for the same period a year ago. The increase in net loss was
the result of taking one-time write-offs for bad debt, increased expenses
required to implement changes in the Company's business model, and new
development work on the Company's new web portal, www.anyreminder.com. There
were 2,443,802 shares issued and outstanding as of May 13, 2000.
Liquidity and Capital Resources
The Company's operations to date have concentrated on developing its Internet
storefronts, building brand recognition and a loyal customer following, and
securing the financing necessary to fund the development, operations and
expansion of its business.
<PAGE>
As of March 31, 2000, the Company had $479,942 cash on hand, accounts receivable
of $7,061, and a receivable note of $55,000. The Company had several
supplier-based revolving lines of credit, including Tech Data, $46,000; Ingram
Micro, $112,000; Merisel, $50,000.
Net cash used by operating activities for the period ending March 31, 2000
totaled ($1,053,965) compared to ($224,075) for the same period a year ago. The
increase in negative cash flow is the result of the Company's increased spending
to change its business model and exiting the low-cost, low-margin Internet
e-commerce retailer business.
Net cash used by investing activities totaled ($24,657) for the period ending
March 31, 2000 compared to ($72,265) for the same period a year ago. The
decrease in investing activities was the result of reduced office equipment
acquisition costs and software development activities relating to the Company's
low-cost, low-margin Internet e-commerce storefronts.
Net cash provided by financing activities totaled $1,557,110 for the period
ending March 31, 2000 compared to $ 273,200. The cash provided for by financing
activities was generated primarily through the sale of restricted equity
securities.
The Company expects to continue making significant investments in the future to
support its overall growth. Currently, it is anticipated that ongoing
operations will be sufficiently financed from the net proceeds of the
anticipated exercise of the warrants the common stock that were registered this
year, cash on hand, accounts receivable, and from borrowing activities and sales
of debt and equity instruments. However, as indicated in the Company's most
recent financial statements available herein, while operating activities provide
some cash flow, the Company is currently cash flow negative. There can be no
assurances that the Company's ongoing operations will begin to generate a
positive cash flow or that unforeseen events may not require more working
capital than the Company currently has at its disposal.
Year 2000 Compliance
The Company did not experience any disruptions to its operations or computer
systems as a result of Year 2000.
PART II - OTHER INFORMATION
Item 3. Changes in Securities and Use of Proceeds
In the quarter ending March 31, 2000 the Company received $0 as payment for
common stock subscribed, but unpaid for, on May 14, 2000. The price of the
shares was $2.00 a share. For additional details see Item 26 of the Company's
registration statement on Form SB-2 filed with the Securities and Exchange
Commission on February 4, 1999.
On March 13, 2000 the Company issued 3,000 shares of common stock valued at
$1.00 a share to Christa Dunn for services on the development of the anyreminder
site. This transaction was exempt from registration under Section 4(2) of the
Securities Act and Rule 144 thereunder. Stock issued under these exemptions
carries certain resale restrictions and the stock certificates bear restrictive
legends.
<PAGE>
On March 13, 2000 the Company issued 20,000 shares of common stock valued
at $1.00 per share to Thomas and Laura O'Hara for financing and interest on the
pay-off of some old payables. This transaction was exempt from registration
under Section 4(2) of the Securities Act and Rule 144 thereunder. Stock issued
under these exemptions carries certain resale restrictions and the stock
certificates bear restrictive legends.
On March 13, 2000, the Company granted Jay Ferguson, an employee, options
to purchase 15,000 shares of common stock at $1.00 a share. The options vested
at a rate of one-third per year from the date of issue and expire three years
from the date of granting.
On March 13, 2000, the Company granted Keith Varney, an employee, options
to purchase 20,000 shares of common stock at $1.00 a share. The options vested
at a rate of 5,000 shares per year for two years and 10,000 shares from the date
of issue and expire three years from the date of granting.
On March 13, 2000, the Company granted Sharon Gillen, an employee, options
to purchase 20,000 shares of common stock at $1.00 a share. The options vested
at a rate of 5,000 shares per year for two years and 10,000 shares from the date
of issue and expire three years from the date of granting.
On March 13, 2000, the Company granted Richard Baron, a business
consultant, options to purchase 3,000 shares of common stock at $3.00 a share.
The options are vested at the date of issue and expire two years from the date
of granting.
On March 13, 2000 the Company issued 5,000 shares of common stock valued at
$1.00 a share to Catherine Hickman for services on the development of the
anyreminder site. This transaction was exempt from registration under Section
4(2) of the Securities Act and Rule 144 thereunder. Stock issued under these
exemptions carries certain resale restrictions and the stock certificates bear
restrictive legends.
On March 13, 2000 the Company issued 80,000 shares of common stock valued
at $1.00 per share to Thomas and Mull & Paige Associates, Ltd. for financing and
Business advisory services. This transaction was exempt from registration under
Section 4(2) of the Securities Act and Rule 144 thereunder. Stock issued under
these exemptions carries certain resale restrictions and the stock certificates
bear restrictive legends.
On March 13, 2000, the Company granted Steve Fischer, a business
consultant, options to purchase 6,000 shares of common stock at $3.50 a share.
The options vested at a rate of one-third per month from the date of issue and
expire three years from the date of granting.
On March 13, 2000, the Company issued 9,934 shares of common stock valued
at $1 a share to William Kroske, Ph.D. for services. This transaction was exempt
from registration under Section 4(2) of the Securities Act and Rule 144
thereunder. Stock issued under these exemptions carries certain resale
restrictions and the stock certificates bear restrictive legends.
On February 20, 2000 the Company issued 500,000 shares of common stock for
options exercised and registered under the founders option program.
On February 10, 2000 issued 5,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
<PAGE>
On January 4, 2000 the Company issued 5,000 shares of Convertible Class A
Preferred Stock in exchange for $ 10,000This transaction was exempt from
registration under Section 4(2) of the Securities Act and Rule 144 thereunder.
Stock issued under these exemptions carries certain resale restrictions and the
stock certificates bear restrictive legends.
On March 8, 2000 issued 50,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
On March 10, 2000 issued 5,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
On March 10, 2000 issued 5,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
On March 10, 2000 issued 40,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
On March 28, 2000 issued 50,000 shares of common stock was excise of
registered stock purchase warrants at $3.00 per share
Item 4 Subsequent Events
The Company had issued a press release on November 15, 1999 regarding funding
for business expansion. In that press release the Company expected to receive
$1,500,000 to launch the new business direction and marketing. Only $ 300,000 of
that equity was received and as previously reported the Company has raised money
from other sources and changed its business model.
On May 3, 2000 William Kroske left to pursue personal interests and on May 8,
2000 the Company named its President Larry Arnold as its new CEO.
On May 5, 2000 the Company annouced it had entered into a letter of intent to
acquire Inform Worldwide Inc. of Englewood, Co for 3,000,000 shares of its
restricted Common Stock. Inform Worldwide Inc., a privately held corporation, is
a leader in the development of business applications that combine geography and
the Internet. Inform develops cost effective, location-based services that
enable businesses to increase productivity, profitability, and market share.
Both Companies expect the to close the transaction on sixty days.
Item 5. Submission of Matters to a Vote of Security Holders
There were no items during the period subject vote of the Security Holders.
Item 6. Exhibits and Reports on Form 8-K
(A) Exhibits
27.1 Financial Data Schedule
Accountants Review Report
(B) Reports on Form 8-K
----------------------
There no Form 8-K filed during the period.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Anything Internet Corporation
(Registrant)
Dated: May 24, 2000 By: /s/ Donald W Prosser
---------------------------
Donald W Prosser
CFO
<PAGE>
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