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U.S. SECURITIES & EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2000
Commission File Number 0-25433
KWIKWEB.COM, INC.
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(Exact name of small business issuer as specified in its charter)
NEVADA 88-0377059
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
374 N. Coast Highway, Suite F-14, Encinitas, California 92024
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(Address of principal executive offices) (Zip Code)
760-436-5436
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(Issuer's telephone number)
(2155 Newcastle Ave., Cardiff by the Sea, California 92007 (former address)
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(Former name, former address and former fiscal year, if changed
since last report)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
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 August 15, 2000 the Registrant had 3,910,000 shares of its common stock,
par value $0.001, issued and outstanding.
Transitional Small Business Disclosure Format: Yes No X
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
KWIKWEB.COM, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
June 30, 2000
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ASSETS
CURRENT ASSETS:
Cash $ 25,218
Due from shareholder 3,967
Prepaid expenses 5,050
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TOTAL CURRENT ASSETS 34,235
EQUIPMENT, NET OF $12,695 ACCUMULATED DEPRECIATION 30,466
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$ 64,701
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LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable $ 6,043
Accrued liabilities 28,785
Shareholder advances 60,000
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TOTAL CURRENT LIABILITIES 94,828
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COMMITMENTS AND CONTINGENCIES -
SHAREHOLDERS' DEFICIT:
Common stock, $.001 par value, 25,000,000 shares authorized,
9,910,000 shares issued and outstanding 9,910
Additional paid-in capital 698,772
Deficit accumulated during the development stage (738,809)
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TOTAL SHAREHOLDERS' DEFICIT (30,127)
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$ 64,701
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The accompanying notes are an integral part of these financial statements.
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KWIKWEB.COM, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED JUNE 30,
2000 1999
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REVENUE $ -- $ --
EXPENSES:
Research and development 53,937 47,590
General and administrative 72,738 34,540
Interest 89 --
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TOTAL EXPENSES 126,764 82,130
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NET LOSS $ (126,764) $ (82,130)
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BASIC AND DILUTED NET LOSS PER SHARE $ (0.01) $ (0.01)
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BASIC AND DILUTED WEIGHTED AVERAGE
NUMBER OF COMMON SHARES OUTSTANDING 9,910,000 6,000,000
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The accompanying notes are an integral part of these financial statements.
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KWIKWEB.COM, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
CUMULATIVE
FROM INCEPTION
(OCTOBER 9,
SIX MONTHS ENDED JUNE 30, 1997) TO
2000 1999 JUNE 30, 2000
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<S> <C> <C> <C>
REVENUE $ -- $ -- $ --
EXPENSES:
Research and development 99,312 61,889 261,938
General and administrative 204,368 40,388 466,782
Interest 89 -- 10,089
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TOTAL EXPENSES 303,769 102,277 738,809
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NET LOSS $ (303,769) $ (102,277) $ (738,809)
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BASIC AND DILUTED NET LOSS PER SHARE $ (0.03) $ (0.02)
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BASIC AND DILUTED WEIGHTED AVERAGE
NUMBER OF COMMON SHARES OUTSTANDING 9,910,000 6,000,000
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</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
KWIKWEB.COM, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
CUMULATIVE
FROM INCEPTION
(OCTOBER 9,
SIX MONTHS ENDED JUNE 30, 1997) TO
2000 1999 JUNE 30, 2000
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<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (303,769) $ (102,277) $ (738,809)
Adjustments to reconcile net loss to
net cash used by operating activities:
Depreciation and amortization 6,227 1,934 12,695
Decrease (increase) in prepaid expenses 6,021 - (5,050)
Contributed capital - salary - 26,650 88,682
Increase (decrease) in accounts payable (1,754) (2,911) 6,043
(Decrease) increase in accrued liabilities 9,277 - 28,785
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Net cash used by operating activities (283,998) (76,604) (607,654)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment (13,524) (1,785) (43,161)
Loans to shareholder (88) (2,963) (3,967)
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Net cash used by investing activities (13,612) (4,748) (47,128)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Shareholder advances 60,000 - 60,000
Common stock issued for cash - - 620,000
Subscription receivable - 77,600 -
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Net cash provided by financing activities 60,000 77,600 680,000
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Net (decrease) increase in cash (237,610) (3,752) 25,218
CASH, BEGINNING OF PERIOD 262,828 24,286 -
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CASH, END OF PERIOD $ 25,218 $ 20,534 $ 25,218
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The accompanying notes are an integral part of these financial statements.
</TABLE>
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KWIKWEB.COM, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2000
(UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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Organization
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KwikWeb.com, Inc., a Nevada corporation, was formed on October 9, 1997 to
design, develop and market proprietary software that allows on-line users
to easily create and build their own customized websites using a user
friendly "point and click" format. In June 2000, the Company formed
Internet Properties Development, Inc., a wholly owned subsidiary, to
pursue the development and incubation of emerging Internet-based business.
The Company has not commenced planned principal operations and, therefore,
is considered to be in the development stage.
Principles of consolidation
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The accompanying consolidated financial statements include the accounts of
KwikWeb.com, Inc. and its wholly owned subsidiaries Kwik Web, Inc. and
Internet Properties Development, Inc. (collectively, the "Company"). All
significant intercompany transactions and balances have been eliminated in
consolidation.
Interim periods
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The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions of Form 10-QSB and do not
include all of the information required by generally accepted accounting
principles for complete financial statements. In the opinion of the
Company's management, all necessary adjustments (consisting of normal
recurring adjustments) for a fair presentation have been included.
Operating results for the three and six month periods ended June 30, 2000,
are not necessarily indicative of results for any future period. These
statements should be read in conjunction with the consolidated financial
statements and notes thereto for the six months ended December 31, 1999
included in the Company's Form 10-KSB .
2. SUBSEQUENT EVENT
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In August, 2000, the Company completed a reorganization whereby it sold a
75% interest in its website design and management business to Kwik
Commerce, Inc. in exchange for the cancellation of 6,000,000 common shares
previously held by Ric Kaestner and Alex Tsakiris.
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ITEM 2. PLAN OF OPERATION
The Company was formed in October 1997 under the name G.P. Properties,
Inc. From 1989 until August 1999, the Company was engaged in the business of
developing residential financial analysis software for real estate brokers. In
August 1999, the Company completed a series of transactions pursuant to which it
discontinued all operations regarding the development of financial analysis
software. At the same time the Company acquired all of the outstanding capital
shares of KwikWeb, Inc., which was engaged in the business of developing
software applications for the creation of internet websites, from Richard
Kaestner and Alex Tsakiris in exchange for 6,000,000 shares of its common stock.
In June 2000, the Company formed its Internet Properties Development,
Inc. subsidiary to pursue the development and incubation of emerging
internet-based business, and going forward the Company intends to focus on the
development and expansion of its internet incubator business. In connection with
the Company's decision to focus on its internet incubator business, in August
2000 the Company completed a reorganization pursuant to which it sold a 75%
interest in its website design and management business to Kwik Commerce, Inc., a
corporation run by Richard Kaestner and Alex Tsakiris, in exchange for the
cancellation of the 6,000,000 shares of the Company's common stock that had been
issued to Messrs. Kaestner and Tsakiris in the August 1999 acquisition of
KwikWeb, Inc.
PLAN OF OPERATION
The Company's operations to date have consisted of the development and
subsequent sale of its web design and management business, the development,
launch and implementation of its internet incubator business, and the
identification of potential incubator candidates. To date, the Company has not
generated any revenue from its operations. Over the next 12 months, the Company
intends to continue the development and expansion of its internet incubator
business by identifying, developing and launching emerging growth internet-based
businesses.
The Company has incurred operating losses since its inception and, as
of June 30, 2000, had an accumulated net loss of $738,809. The Company has not
generated any revenues to date, and it expects to incur operating losses until
such time as it can conduct its operations in a profitable manner. The Company
is unable to predict when it will be able to generate profits from operations,
and there can be no guarantees that it will be able to do so.
LIQUIDITY AND FINANCIAL CONDITION
Since inception, the Company has financed its operations primarily
through sales of its equity securities. Through June 30, 2000, the Company had
raised approximately $620,000 from the sale of common stock. At June 30, 2000,
the company had a working capital deficit of approximately $60,500, and a total
shareholders' deficit of approximately $30,100. The Company believes that it
will require at least an additional $400,000 in order to fund its operations
over the next 12 months. It expects to fund its capital requirements over the
next 12 months through the sale of its securities, but there can be no assurance
that it will be able to do so. The report of the Company's independent
accountants for the six month transitional period ended December 31, 1999 states
that due to the absence of operating revenues and the Company's limited capital
resources, there is doubt about its ability to continue as a going concern.
SAFE HARBOR
This report contains various forward-looking statements that are based
on the Company's beliefs as well as assumptions made by and information
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currently available to the Company. When used in this report, the words
"believe," "expect," "anticipate," "estimate" and similar expressions are
intended to identify forward-looking statements. Such statements are subject to
certain risks, uncertainties and assumptions referred to herein, including,
without limitation, the early stage nature of the Company's operations and the
risks and uncertainties concerning the market acceptance of its services and
products; technological changes; increased competition; and general economic
conditions. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those anticipated, estimated, or projected. The Company cautions
potential investors not to place undue reliance on any such forward-looking
statements, all of which speak only as of the date made.
PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
In August 2000, in connection with the transaction described in Item 5
below and the related termination of their employment agreements, the Company
cancelled an aggregate of 6,000,000 shares of its common stock that had been
held by Richard Kaestner and Alex Tsakiris, each of whom are former officers and
directors of the Company, .
In April 2000, the Company granted options to purchase 134,000 shares
of its common stock to certain of its employees and consultants. The grant of
these options was exempt from registration under the Securities Act of 1933
pursuant to Section 4(2) thereof and there was no underwriter involved in the
transactions. All of these options were subsequently cancelled in connection
with the sale of assets described in Item 5 below. As of the date of this
report, the Company has no stock options outstanding.
ITEM 5. OTHER INFORMATION
In August 2000 the Company completed a reorganization pursuant to which
it sold a 75% interest in its website design and management business to Kwik
Commerce, Inc., a corporation run by Richard Kaestner and Alex Tsakiris, in
exchange for the cancellation of the 6,000,000 shares of the Company's common
stock that had been issued to Messrs. Kaestner and Tsakiris in the August 1999
acquisition of KwikWeb, Inc. Effective upon the sale of assets to Kwik Commerce,
Messrs. Kaestner and Tsakiris resigned as officers and directors of the Company.
The Company, through its then newly-formed Internet Properties
Development, Inc. subsidiary, has agreed to purchase certain internet domain
names and related assets from Site HQ, Inc., Internet Properties Development,
LLC and H. Page Howe, an individual, for an aggregate purchase price of
approximately $139,000. H. Page Howe, who is a director and the chairman of the
Company, is an affiliate of Site HQ, Inc., and Internet Properties Development,
LLC.
In June 2000, Matthew Hayes, H. Page Howe and Jeffrey Stevens were
elected to the Company's Board of Directors. In August 2000 (i) Richard Kaestner
and Alex Tsakiris resigned as officers and directors of the Company and (ii)
Matthew Hayes was elected as the Company's president and H. Page Howe was
elected as the Company's chairman.
ITEM 6. EXHIBITS AND REPORTS ON FROM 8-K.
(a) Exhibits
27.1 Financial Data Schedule
(b) Reports of Form 8-K
None.
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.
KWIKWEB.COM, INC.
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(Registrant)
Dated: August 18, 2000 By /s/ Matthew Hayes
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Matthew Hayes
President and Chief Accounting Officer
