<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 26, 1999
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G.P. Properties, Inc.
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(Exact name of registrant as specified in its charter)
Nevada 001-09925 87-0427731
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
2155 Newcastle Avenue, Cardiff, California 92007
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (760) 943-7829
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(Former name or former address, if changed since last report)
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<PAGE>
Item 7. Financial Statements and Exhibits
(a) Financial statements of businesses acquired.
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This report amends the current report filed by G.P. Properties, Inc. (the
"Company") dated August 26, 1999.
Effective August 26, 1999, the Company completed the acquisition of Kwik
Web, Inc., a California corporation ("Kwik Web"), in exchange for 6,000,000
shares of the Company's common stock.
The audited financial statements of Kwik Web, Inc. as of December 31, 1998,
for each of the two fiscal years ended December 31, 1998 and cumulative from
inception (October 9, 1997) to December 31, 1998 are presented below. The
interim unaudited financial statements of Kwik Web, Inc. as of September 30,
1999, for the nine month period ended September 30, 1999 and cumulative from
inception (October 9, 1997) to September 30, 1999 are also presented.
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
--------------------------------------------------
The Board of Directors and Shareholders
Kwik Web, Inc.
We have audited the accompanying balance sheet of Kwik Web, Inc. (a development
stage company) (the "Company") as of December 31, 1998, and the related
statements of operations, shareholders' equity and cash flows for the year ended
December 31, 1998, for the period from inception (October 9, 1997) to December
31, 1997 and the period from inception (October 9, 1997) to December 31, 1998.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes, on a test basis, examination of evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall consolidated financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Kwik Web, Inc. as of December
31, 1998, and the results of its operations and its cash flows for the year
ended December 31, 1998, for the period from inception (October 9, 1997) to
December 31, 1997 and the period from inception (October 9, 1997) to December
31, 1998 in conformity with generally accepted accounting principles.
CACCIAMATTA ACCOUNTANCY CORPORATION
Irvine, California
October 1, 1999
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Balance Sheet
<TABLE>
<CAPTION>
December 31, 1998
----------------------
<S> <C>
ASSETS
Current assets:
Cash $ 24,286
Due from shareholder 1,619
Prepaid franchise tax 800
----------------------
Total current assets 26,704
Equipment, net of accumulated depreciation of $1,241 12,212
----------------------
$ 38,917
======================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 9,137
Deferred revenue 25,000
----------------------
Total current liabilities 34,137
Commitments and contingencies -
Shareholders' equity:
Common stock, $.01 par value, 2,000 shares authorized,
100 shares issued and outstanding 1
Additional paid-in capital 182,031
Common stock subscriptions receivable (77,600)
Deficit accumulated during the development stage (99,652)
----------------------
Total shareholders' equity 4,780
----------------------
$ 38,917
======================
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
Cumulative from
Inception Inception
Year ended (October 9, 1997) to (October 9, 1997) to
December 31, 1998 December 31, 1997 December 31, 1998
-------------------- ---------------------- --------------------
<S> <C> <C> <C>
Revenue $ 1,040 $ 750 $ 1,790
-------------------- ---------------------- --------------------
Expenses:
Research and development 74,705 12,940 87,644
General and administrative 12,143 1,655 13,798
-------------------- ---------------------- --------------------
Total Expenses 86,847 14,595 101,442
-------------------- ---------------------- --------------------
Net loss $ (85,807) $ (13,845) $ (99,652)
==================== ====================== ====================
Basic and diluted net loss per share $ (916.50) $ (166.80)
==================== ======================
Basic and diluted weighted average number
of common shares outstanding 94 83
==================== ======================
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Statement of Shareholders' Equity
From inception (October 9, 1997) to December 31, 1998
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional Common Stock During the Total
------------------------
Number Paid-in Subscriptions Development Shareholders'
of Shares Amount Capital Receivable Stage Equity
----------- -------- ------------ --------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Initial capitalization 58 $1 $ - $ - $ - $ 1
Issuance of common stock 25 - 44,999 (24,000) - 20,999
Contributed capital - salary - - 5,035 - - 5,035
Net loss for 1997 - - - - (13,845) (13,845)
----------- -------- ------------ --------------- -------------- ---------------
Balance, December 31, 1997 83 1 50,034 (24,000) (13,845) 12,190
Issuance of common stock 17 - 75,000 (75,000) - -
Payment of subscriptions
receivable - - - 21,400 - 21,400
Contributed capital - salary - - 56,997 - - 56,997
Net loss for 1998 - - - - (85,807) (85,807)
----------- -------- ------------ --------------- -------------- ---------------
Balance, December 31, 1998 100 $1 $182,031 $(77,600) $(99,652) $ 4,780
=========== ======== ============ =============== ============== ===============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
Cumulative
Inception from inception
Year ended (October 9, 1997) to (October 9, 1997) to
December 31, 1998 December 31, 1997 December 31, 1998
----------------- --------------------- ---------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $(85,807) $ (13,845) $(99,652)
Adjustments to reconcile net income to net cash
used by operating activities:
Depreciation 1,188 53 1,241
Compensation expense contributed to capital 56,997 5,035 62,032
Increase in prepaid franchise tax (800) - (800)
(Increase) decrease in due from shareholder (1,833) 215 (1,618)
(Increase) decrease in deposits 1,500 (1,500) -
Increase in accounts payable 9,136 - 9,136
Increase in deferred revenue 25,000 - 25,000
---------- -------- -------
Net cash provided by operating activities 5,381 (10,042) (4,660)
---------- -------- -------
Cash flows from investing activities:
Purchases of equipment (11,275) (2,179) (13,453)
---------- -------- -------
Net cash used by investing activities (11,275) (2,179) (13,453)
---------- -------- -------
Cash flows from financing activities:
Payment on subscription receivable 21,400 - 21,400
Issuance of common stock - 21,000 21,000
---------- -------- -------
Net cash provided by financing activities 21,400 21,000 42,400
---------- -------- -------
Net increase in cash 15,507 8,779 24,286
Cash, beginning of period 8,779 - -
---------- -------- -------
Cash, end of period $ 24,286 $ 8,779 $ 24,286
========== ========= ========
Non-cash investing and financing activities:
Issuance of common stock for
subscriptions receivable $ 75,000 $ 24,000 $ 99,000
========== ========= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998
1. Organization and summary of significant accounting policies
- --------------------------------------------------------------
Organization
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Kwik Web, Inc., a California Corporation (the "Company"), was formed on
October 9, 1997 to develop technology specifically suited for online internet
website building. The Company's initial products "Kwik Web Instant Website
Builder" and "Kwik Web StoreFront Builder" are targeted at companies that
desire to add website building to their internet presences.
Cash and equivalents
--------------------
The Company considers all liquid investments with the maturity of three
months or less from the date of purchase that are readily convertible into
cash to be cash equivalents.
Equipment
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Depreciation expense is provided over the estimated useful life of 5 years
using the straight-line method.
Use of estimates
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The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Accordingly, actual
results could differ from those estimates.
Income taxes
------------
The Company reports certain expenses differently for financial and tax
reporting purposes and, accordingly, provides for the related deferred taxes.
Income taxes are accounted for under the liability method in accordance with
SFAS 109.
Revenue recognition
-------------------
Revenue is recognized when the product is delivered for use by the customer.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998
1. Organization and summary of significant accounting policies (continued)
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Research and development costs
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Costs and expenses that can be clearly identified as research and development
are charged to expense as incurred in accordance with SFAS 2 "Accounting for
Research and Development Costs".
Basic and diluted net loss per share
------------------------------------
Net loss per share is calculated in accordance with Statement of Financial
Accounting Standards 128, Earnings Per Share ("SFAS 128"), which superseded
Accounting Principles Board Opinion 15 ("APB 15"). Net loss per share for all
periods presented has been restated to reflect the adoption of SFAS 128.
Basic net loss per share is based upon the weighted average number of common
shares outstanding. Diluted net loss per share is based on the assumption
that all dilutive convertible shares and stock options were converted or
exercised. Dilution is computed by applying the treasury stock method. Under
this method, options and warrants are assumed to be exercised at the
beginning of the period (or at the time of issuance, if later), and as if
funds obtained thereby were used to purchase common stock at the average
market price during the period.
2. Shareholders' equity
- -----------------------
Common stock
------------
In October 1997, the Company was initially capitalized by the issuance of 58
shares of common stock. Also in October 1997, the Company sold 25 shares of
common stock for $21,000 cash and a $24,000 subscription receivable. In May
1998, the Company sold 17 shares of common stock for a $75,000 subscription
receivable which was paid in January 1999.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998
3. Basic and diluted loss per share
- -----------------------------------
The following table illustrates the required disclosure of the reconciliation
of the numerators and denominators of the basic loss per share computations
(the Company has no potentially dilutive securities, options, warrants or
other rights outstanding).
<TABLE>
<CAPTION>
1998 1997
---------------- ----------------
<S> <C> <C>
Basic and diluted loss per share:
- ---------------------------------
Numerator
---------
Net loss $(85,807) $(13,845)
---------------- ----------------
Denominator
-----------
Basic and diluted weighted average number of
common shares outstanding during the period 94 83
---------------- ----------------
Basic and diluted earnings per share $(916.50) $(166.81)
================ ================
</TABLE>
4. Income taxes
- ---------------
The Company recognizes deferred tax assets and liabilities for temporary
differences between the financial reporting and tax bases of its assets and
liabilities. Deferred tax assets are reduced by a valuation allowance when
deemed appropriate.
At December 31, 1998, the Company has a net operating loss carryforward for
federal tax purposes of $2,359 which, if unused to offset future taxable
income, will expire in years beginning in 2013.
The Company had deferred tax assets of $9,792 at December 31, 1998 relating
to deferred revenue and its net operating loss. This deferred tax asset had a
valuation allowance applied to it in the same amount.
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<PAGE>
KWIK WEB, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998
5. Subsequent events
- --------------------
Merger agreement and issuance of common stock
---------------------------------------------
In August 1999, the Company and G.P. Properties, Inc. ("G.P. Properties")
agreed to merge under a Securities Purchase Agreement and Plan of
Reorganization whereby G.P. Properties issued 6,000,000 shares of common
stock in exchange for all of the outstanding common shares of the Company.
G.P. Properties, a Nevada corporation, formed July 6, 1989 to implement a
concept for financial analysis software for real estate brokers, retained its
3,510,000 shares of common stock, had no assets, liabilities or operations
and the principal of Kwik Web, Inc. assumed control of the merged entity.
Accordingly, Kwik Web, Inc. was deemed the accounting acquiror of
G.P. Properties in this reverse merger. Subsequent to the reverse merger,
G.P. Properties issued 400,000 shares of stock for $500,000.
Lease commitment
----------------
Subsequent to year-end the Company has entered into a lease for office space
at $800 per month. The lease has a three year term and expires in 2002.
Annual lease commitments are $8,800 for the year ending December 31, 1999,
$9,600 for each of the years ending December 31, 2000 and 2001, and $800 for
the year ending December 31, 2002.
Related party transactions
--------------------------
Subsequent to year-end the Company received two bridge loans, one from a
shareholder and the other from another related party, in the amounts of
$20,000 and $100,000, respectively. The $100,000 bridge loan was repaid in
full, including interest of $10,000 in September 1999.
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<PAGE>
(b) Pro forma financial information.
-------------------------------
G.P. Properties, Inc.
(A Development Stage Company)
Pro Forma Condensed Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Year Ended
September 30, 1999 December 31, 1998
------------------- -----------------
<S> <C> <C>
Revenue $ 39,351 $ 1,040
Expenses:
Research and development 79,651 74,705
General and administrative 135,120 12,477
-------------------- ------------------
Total Expenses 214,772 87,181
Net loss $ (175,421) $ (86,141)
==================== ==================
Basic and diluted net loss per share $ (0.02) $ (0.01)
==================== ==================
Basic and diluted weighted average number
of common shares outstanding 9,510,000 9,510,000
==================== ==================
</TABLE>
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<PAGE>
G.P. Properties, Inc.
Pro Forma Financial Information
(Unaudited)
The accompanying pro forma condensed statements of operations for the nine
months ended September 30, 1999 and the year ended December 31, 1998, assumes
the merger was consummated on January 1, 1998.
With respect to G.P. Properties, whose fiscal year ends on June 30, the nine
month period through September 30, 1999 includes nine/twelfths of the results of
operations for the year ended June 30, 1999 and the year ended December 31, 1998
includes half the results of the operations for the two years ended June 30,
1999. These computed results of operations were added to the actual results for
Kwik Web.
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<PAGE>
SIGNATURE
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 hereunto duly authorized.
G.P. PROPERTIES, INC.
(Registrant)
Date: November 22, 1999 By: /s/ Richard Kaestner
---------------------------------
Richard Kaestner, President
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