U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from ___________ to ___________
Commission File Number: 0-26181
eClic, Inc.
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(Name of small business issuer in its charter)
Nevada 86-0945116
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification
No.)
8555 W. Sahara, Suite 130, Las Vegas, NV 89117
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(Address of principal executive offices) (zip code)
1-888-971-1336
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(Issuer's telephone number)
Securities registered under Section 12(b) of the Exchange Act:
Title of each class registered: None Name of each exchange on which
registered: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, par value $.001
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(Title of class)
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 [ ]
Check if no disclosure of delinquent filers in response to Item 405
of Regulation S-B is contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [ ]
The Issurer's stock is not trading on any stock exchange.
As of December 31, 1999, the issuer had 1,500,000 shares of common stock
outstanding.
Documents incorporated by reference: None
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
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CONTENTS
PAGE
PART I
Item 1. Description of Business........................................3
Item 2. Description of Property.......................................19
Item 3. Legal Proceedings.............................................19
Item 4. Submission of Matters to a Vote of Security Holders...........19
PART II
Item 5. Market for Common Equity and Related Stockholder Matters......20
Item 6. Management's Discussion and Analysis or Plan of Operation.....21
Item 7. Financial Statements..........................................24
Item 8. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure........................26
PART III
Item 9. Directors, Executive Officers, Promoters and Control
Persons; Compliance with Section 16(a) of the
Exchange Act...............................................27
Item 10. Executive Compensation........................................28
Item 11. Security Ownership of Certain Beneficial Owners and
Management.................................................29
Item 12. Certain Relationships and Related Transactions................29
Item 13. Exhibits and Reports on Form 8-K..............................30
SIGNATURES ..............................................................32
Forward-Looking Statements
This report contains forward-looking statements. The forward-looking statements
include all statements that are not statements of historical fact. The
forward-looking statements are often identifiable by their use of words such
as "may," "expect," "believe," "anticipate," "intend," "could," "estimate," or
"continue," "Plans" or the negative or other variations of those or comparable
terms. Our actual results could differ materially from the anticipated results
described in the forward-looking statements. Factors that could affect our
results include, but are not limited to, those discussed in Item 6,
"Management's Discussion and Analysis or Plan of Operation" and included
elsewhere in this report.
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PART I
ITEM 1. DESCRIPTION OF BUSINESS.
(a) BUSINESS DEVELOPMENT
(i) Business Development, Organization and Acquisition Activities
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eClic, Inc., a new Internet e-Commerce company, hereinafter referred to as
"eClic, Inc." or the " Company" or the "Registrant", was organized by the
filing of Articles of Incorporation with the Secretary of State of the State
of Nevada on March 1, 1999.
The Company is a development stage Internet e-Commerce company with a
principal business objective to sell and market health related products or
products which offer the Company potential revenues, and generate advertising
revenues from other vendors who sell and market products through the World
Wide Internet.
The original Articles of the Company authorized the issuance of twenty-five
million (25,000,000) shares. There are twenty million (20,000,000) shares of
Common Stock at par value of $0.001 per share and five million (5,000,000)
shares of Preferred at par value of $0.001 per share.
The Registrant was incorporated on March 1, 1999, in the state of Nevada
under the name eClic, Inc. In connection with its formation, a total of
1,000,000 shares of its common stock were purchased by its founder of the
Company, on March 16, 1999. Between March 20 and April 4, 1999, the Company
sold Five Hundred Thousand (500,000) shares of its common stock in
connection with a public offering at a price of $0.10 per share.
On April 5, 1999, the Company completed a public offering of shares of
common stock of the Company pursuant to Regulation D, Rule 504 of the
Securities Act of 1933, as amended, whereby it sold 500,000 shares of the
Common Stock of the Company to approximately forty (40) unaffiliated
shareholders of record. The Company filed an original Form D with the
Securities and Exchange Commission on or about March 22, 1999.
On March 16, 1999, founding shareholder purchased 1,000,000 shares of the
company's authorized but unissued treasury stock for cash. Additionally,
the Company sold Fifty Thousand Dollars ($50,000) or Five Hundred Thousand
(500,000) shares of the Common Stock of the Company during the Offering to
approximately forty (40) shareholders. The offering was closed April 5,
1999. As of April 5, 1999, the Company has one million five hundred thousand
shares (1,500,000) shares of its $0.001 par value common voting stock issued
and outstanding which are held by approximately forty-one (41) shareholders,
including the founding shareholder, of record. The Company is a newly formed
Internet e-Commerce company, which plans to market health care products over
the Internet, through its Web site, http://www.eClic.com.
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B. Business of Issuer
1) Principal Products, Services and Principal Markets.
The Company plans to seek outside suppliers who would be willing to allow
eClic.com to merchandise, market and sell their products through the
Company's Internet Web site, for a nominal fee. These suppliers would be
responsible for inventory, billing and shipping their products to the
potential customers generated through the Company's Web site. The company
plans to focus, but not limit itself to health care products. There are a
number of personal care products where consumers might prefer the ease,
convenience and privacy of ordering these products through the Internet.
Additionally, the Company plans to seek advertisers, to advertise their
product(s) on the Company's Web site. For any advertisers on the Company's
Web site, the Company will provide a link to the advertisers' Web site and
charge a customary/nominal fee, e.g., $0.10 (ten cents) for each customer who
links to their advertisers Web site.
(a) Limited Operating History
The Company was first incorporated in the State of Nevada on March 1, 1999.
Accordingly, the Company has a limited operating history upon which an
evaluation of the Company, its current business and its prospects can be
based, each of which must be considered in light of the risks, expenses and
problems frequently encountered by all companies in the early stages of
development, and particularly by such companies entering new and rapidly
developing markets like the Internet. The Company's prospects must be
considered in light of the risks, uncertainties, expenses and difficulties
frequently encountered by companies in their early stages of development,
particularly companies in new and rapidly evolving markets such as online
commerce. Such risks include, without limitation, the lack of broad
acceptance of the company's products on the Internet, the possibility that
the Internet will fail to achieve broad acceptance, the inability of the
Company to generate significant e-Commerce-based revenues from Internet
customers, the company's inability to anticipate and adapt to a developing
market, the failure of the company's network infrastructure (including its
server, hardware and software) to efficiently handle its Internet traffic,
changes in laws that adversely affect the company's business, the ability of
the Company to manage its operations, including the amount and timing of
capital expenditures and other costs relating to the expansion of the
company's operations, the introduction and development of different or more
extensive communities by direct and indirect competitors of the Company,
including those with greater financial, technical and marketing resources, the
inability of the Company to maintain and increase levels of traffic on its
Web site, the inability of the Company to attract, retain and motivate
qualified personnel and general economic conditions.
(b) Anticipated Losses for the Foreseeable Future
The Company has not achieved profitability to date, and the Company
anticipates that it will continue to incur net losses for the foreseeable
future. The extent of these losses will depend, in part, on the amount of
growth in the Company's revenues from sales of its products, and possibility
advertising revenues on its Web site. As of December 31, 1999, the Company
had an accumulated deficit of twenty-one thousand four hundred ninety
($21,490) dollars. The Company expects that its operating expenses will
increase significantly during the next several years, especially in the
areas of sales and marketing, and brand promotion. Thus, the Company will
need to generate increased revenues to achieve profitability. To the extent
that increases in its operating expenses precede or are not subsequently
followed by commensurate increases in revenues, or that the Company is
unable to adjust operating expense levels accordingly, the Company's business,
results of operations and financial condition would be materially and
adversely affected. There can be no assurances that the Company can achieve
or sustain profitability or that the Company's operating losses will not
increase in the future.
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(c) Dependence on Continued Growth and Viability of the Internet
The Company's future success is substantially dependent upon continued growth
in the use of the Internet. To generate product sales, advertising sales,
e-Commerce service fees for eClic, Inc., the Internet's recent and rapid
growth must continue, and e-Commerce on the Internet must become widespread.
None of these can be assured. The Internet may prove not to be a viable
commercial marketplace. Additionally, due to the ability of consumers to
easily compare prices of similar products or services on competing Web sites,
gross margins for e-Commerce transactions may narrow in the future and,
accordingly, the Company's revenues from e-Commerce arrangements may be
materially negatively impacted. If use of the Internet does not continue to
grow, the Company's business, results of operations and financial condition
would be materially and adversely affected. Additionally, to the extent that
the Internet continues to experience significant growth in the number of
users and the level of use, there can be no assurance that its technical
infrastructure will continue to be able to support the demands placed upon
it. The necessary technical infrastructure for significant increases in
e-Commerce, such as a reliable network backbone, may not be timely and
adequately developed. In addition, performance improvements, such as
high-speed modems, may not be introduced in a timely fashion. Furthermore,
security and authentication concerns with respect to transmission over the
Internet of confidential information, such as credit cared numbers, may
remain. Issues like these could lead to resistance against the acceptance of
the Internet as a viable commercial marketplace. Also, the Internet could
lose its viability due to delays in the development or adoption of new
standards and protocols required to handle increased levels of activity, or
due to increased governmental regulation. Changes in or insufficient
availability of telecommunications services could result in slower response
times and adversely affect usage of the Internet. Demand and market
acceptance for recently introduced services and products over the Internet
are subject to a high level of uncertainty, and there exist few proven
services and products.
The Internet may not be commercially viable in the long term for a number
Of reasons, including potentially inadequate development of the necessary
network infrastructure or delayed development of enabling technologies,
performance improvements and security measures. To the extent that the
Internet continues to experience significant growth in the number of users,
their frequency of use or their band width requirement, there can be no
assurance that the infrastructure for the Internet and other online
services will be able to support the demands placed upon them. In addition,
the Internet or other online services could lose their viability due to
delays in the development or adoption of new standards and protocols required
to handle increased levels of Internet or other online service activity, or
due to increased governmental regulation. Changes in or insufficient
availability of telecommunications services to support the Internet or other
online services also could result in slower response times and adversely
affect usage of the Internet and other online services generally and eClic,
Inc. in particular. If use of the Internet and other online services does
not continue to grow or grows more slowly than expected, if the
infrastructure for the Internet and other online services does not
effectively support growth that may occur, or if the Internet and other
online services do not become a viable commercial marketplace, the
Company's business, results of operations and financial condition would
be adversely affected.
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(d) Risk of System Failures
The Company's ability to facilitate trade successfully and provide high
quality customer service, depends on the efficient and uninterrupted
operation of its computer and communications through its designated Internet
Service Provider (ISP). These systems and operations are vulnerable to damage
or interruption from earthquakes, floods, fires, power loss, telecommunication
failures, break-ins, sabotage, intentional acts of vandalism and similar
events. The Company does not have fully redundant systems, a formal disaster
recovery plan or alternative providers of hosting services and does not carry
business interruption insurance to compensate it for losses that may occur.
Despite any precautions taken by, and planned to be taken by the Company, the
occurrence of a natural disaster or other unanticipated problems with its ISP
could result in interruptions in the services provided by the Company.
In addition, the failure by the ISP to provide the data communications
capacity required by the Company, as a result of human error, natural
disasters other operational disruption, could result in interruptions in the
Company's service. Any damage to or failure of the systems of the Company
could result in reductions in, or terminations of, the eClic service, which
could have a material adverse effect on the Company's business, results of
operations and financial condition. In the case of frequent or frequent or
persistent system failures, the Company's reputation and name brand could be
materially adversely affected. Although the Company has implemented certain
network security measures, the Company and its IPS are also vulnerable to
computer viruses, physical or electronic break-ins and similar disruptions,
which could lead to interruptions, delays, loss of data or the inability to
complete customer auctions. In addition, although the Company works to
prevent unauthorized access to Company data, it is impossible to eliminate
this risk completely. The occurrence of any and all of these events could
have a material adverse effect on the Company's business, results of
operations and financial condition.
(e) Competition
The market for selling health care product over the Internet is relatively
new, rapidly evolving and intensely competitive, and the Company expects
competition to intensify further in the future. Barriers to entry are
relatively low, and current and new competitors can launch new sites at a
relatively low cost using commercially-available software. The Company
potentially competes with a number of other companies marketing similar
health care products over the Internet. Competitive pressures created by
any of the Company's competitors, could have a material adverse effect on
the Company's business, results of operations and financial condition.
The Company believes that the principal competitive factors in its market
are volume and selection of goods, population of buyers and sellers,
community cohesion and interaction, customer service, reliability of delivery
and payment by users, brand recognition, WEB site convenience and
accessibility, price, quality of search tools and system reliability. Some
of the Company's potential competitors have longer operating histories,
larger customer bases, greater brand recognition and significantly greater
financial, marketing, technical and other resources than the Company. In
addition, other online trading services may be acquired by, receive
investments from or enter into other commercial relationships with larger,
well-established and well-financed companies as use of the Internet and other
online services increases.
Therefore, certain of the Company's competitors with other revenue sources
may be able to devote greater resources to marketing and promotional
campaigns, adopt more aggressive pricing policies and devote substantially
more resources to Web site and systems development than the Company or may
try to attract traffic by offering services for free. Increased competition
may result in reduced operating margins, loss of market share and diminished
value in the Company's brands. There can be no assurance that the Company
will be able to compete successfully against current and future competitors.
Further, as a strategic response to changes in the competitive environment,
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the Company may, from time to time, make certain pricing, service or
marketing decisions or acquisitions that could have a material adverse effect
on its business, results of operations and financial condition. New
technologies and the expansion of existing technologies may increase the
competitive pressures on the Company by enabling the Company's competitors to
offer a lower-cost service. Certain Web-based applications that direct
Internet traffic to certain Web sites may channel users to trading services
that compete with the Company. Although the Company plans to establish
arrangements with online services and search engine companies, there can be
no assurance that these arrangements will be renewed on commercially
reasonable terms or that they will otherwise bring traffic to the eClic.com
WEB site. In addition, companies that control access to transactions through
network access or Web browsers could promote the Company's competitors or
charge the Company substantial fees for inclusion. Any and all of these
events could have a material adverse effect on the Company's business,
results of operations and financial condition.
(f) Potential Fluctuations in Operating Results; Quarterly Fluctuations
The Company's operating results may fluctuate significantly in the future
as a result of a variety of factors, many of which are outside the Company's
control. See "--Limited Operating History." As a strategic response to
changes in the competitive environment, the Company may from time to time
make certain pricing, marketing decisions or acquisitions that could have
a material short-term or long-term adverse effect on the Company's business,
results of operations and financial condition.
In particular, in order to accelerate the promotion of eClic.com., the
Company intends to heavily market it Web site. The Company believes that it
may experience seasonality in its business, with use of the Internet and
eClic.com being somewhat lower during the summer vacation and year-end
holiday periods. Advertising impressions (and therefore revenues) may be
expected to decline accordingly in those periods. Additionally, seasonality
may affect significantly any potential advertising revenues during the first
and third calendar quarters, as advertisers historically spend less during
these periods.
There can be no assurance that such patterns will not have a material adverse
effect on the Company's business, results of operations and financial
condition. In addition to selling its brands, it is the Company's strategy
is to generate additional revenues through e-Commerce arrangements including
for other companies to advertise on the company's Web site. There can be no
assurance that the Company will receive any material amount of revenue
under these agreements in the future. The foregoing factors, in some future
quarters, may lead the Company's operating results to fall below the
expectations.
(g) Risk Of Capacity Constraints And Systems Failures
A key element of the Company's strategy is to generate a volume of user
traffic to its Web site. The Company's ability to attract customers and to
achieve market acceptance of its products depends significantly upon the
performance of the Company and its network infrastructure (including its
server, hardware and software). Any system failure that causes interruption
or slower response time of the Company's products and services could result
in less traffic to the Company's Web site and, if sustained or repeated,
could reduce the attractiveness of the Company's products. An increase in the
volume of user traffic could strain the capacity of the Company's technical
infrastructure, which could lead to slower response time or system failures,
and could adversely affect the delivery of the number of impressions that are
owed to advertisers and thus the Company's advertising revenues. In addition,
as the number of Web pages on and users of eClic.com increase, there can be no
assurance that the Company and its technical infrastructure will be able to
grow accordingly, and the Company faces risks related to its ability to
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scale up to its expected customer levels while maintaining superior
performance. Any failure of the Company's server and networking systems to
handle current or higher volumes of traffic would have a material adverse
effect on the Company's business, results of operations and financial
condition. The Company is also dependent upon third parties to provide
potential users with Web browsers and Internet and online services necessary
for access to the site. In the past, users have occasionally experienced
difficulties with Internet and online services due to system failures,
including failures unrelated to the Company's systems. Any disruption in
Internet access provided by third parties could have a material adverse
effect on the Company's business, results of operations and financial
condition. Furthermore, the Company is dependent on hardware suppliers for
prompt delivery, installation and service of equipment used to deliver the
Company's products and services. The Company's operations are dependent in
part upon its ability to protect its operating systems against damage from
human error, fire, floods, power loss, telecommunications failures,
break-ins and similar events. The Company does not presently have redundant,
multiple-site capacity in the event of any such occurrence. The Company's
servers are also vulnerable to computer viruses, break-ins and similar
disruptions from unauthorized tampering with the Company's computer systems.
The occurrence of any of these events could result in the interruption, which
could have a material adverse effect on the Company's business, results of
operations and financial condition. In addition, the Company's reputation
could be materially and adversely affected.
(h) Risks Associated With New Services, Features and Functions
There can be no assurance that the Company would be able to expand its
operations in a cost-effective or timely manner or that any such efforts
would maintain or increase overall market acceptance. Furthermore, any new
business launched by the Company that is not favorably received by consumers
could damage the Company's reputation and diminish the value of its brand
name. Expansion of the Company's operations in this manner would also
require significant additional expenses and development, operations train the
Company's management, financial and operational resources. The lack of
market acceptance of the Company's products would result in the Company's
inability to generate satisfactory revenues and its inability to offset their
costs could have a material adverse effect on the Company's business, results
of operations and financial condition.
(i) Online Commerce Security Risks
A significant barrier to online commerce and communications is the secure
transmission of confidential information over public networks. eClic, Inc.
plans to accept credit cards for purchases of its products. The Company will
rely on encryption and authentication technology licensed from third parties
to provide the security and authentication technology to effect secure
transmission of confidential information, including customer credit card
numbers. There can be no assurance that advances in computer capabilities,
new discoveries in the field of cryptography, or other events or developments
will not result in a compromise or breach of the technology used by the
Company to protect customer transaction data.
If any such compromise of the Company's security were to occur, it could have
a material adverse effect on the Company's reputation and, therefore, on its
business, results of operations and financial condition. Furthermore, a
party who is able to circumvent the Company's security measures could
misappropriate proprietary information or cause interruptions in the
Company's operations. The Company may be required to expend significant
capital and other resources to protect against such security breaches or to
alleviate problems caused by such breaches. Concerns over the security of
transactions conducted on the Internet and other online services and the
privacy of users may also inhibit the growth of the Internet and other online
services generally, and the Web in particular, especially as a means of
conducting commercial transactions. To the extent that activities of the
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Company involve the storage and transmission of proprietary information, such
as credit card numbers, security breaches could damage the Company's
reputation and expose the Company to a risk of loss or litigation and
possible liability. There can be no assurance that the Company's security
measures will prevent security breaches or that failure to prevent such
security breaches will not have a material adverse effect on the Company's
business, results of operations and financial condition.
(j) Risks Associated with Acquisitions
If appropriate opportunities present themselves, the Company would acquire
businesses, technologies, services or product(s) that the Company believes
are strategic.
The Company currently has no understandings, commitments or agreements with
respect to any other material acquisition and no other material acquisition
is currently being pursued. There can be no assurance that the Company will
be able to identify, negotiate or finance future acquisitions successfully,
or to integrate such acquisitions with its current business. The process of
integrating an acquired business, technology, service or product(s) into the
Company may result in unforeseen operating difficulties and expenditures and
may absorb significant management attention that would otherwise be available
for ongoing development of the Company's business. Moreover, there can be no
assurance that the anticipated benefits of any acquisition will be realized.
Future acquisitions could result in potentially dilutive issuances of equity
securities, the incurrence of debt, contingent liabilities and/or
amortization expenses related to goodwill and other intangible assets, which
could materially adversely affect the Company's business, results of
operations and financial condition. Any future acquisitions of other
businesses, technologies, services or product(s) might require the Company to
obtain additional equity or debt financing, which might not be available on
terms favorable to the Company, or at all, and such financing, if available,
might be dilutive.
(k) Risks Associated With International Operations
A component of the Company's strategy is to offer its products online to
international customers. Expansion into the international markets will
require management attention and resources. The Company has limited
experience in localizing its service, and the Company believes that many of
its competitors are also undertaking expansion into foreign markets. There
can be no assurance that the Company will be successful in expanding into
international markets. In addition to the uncertainty regarding the
Company's ability to generate revenues from foreign operations and expand
its international presence, there are certain risks inherent in doing
business on an international basis, including, among others, regulatory
requirements, legal uncertainty regarding liability, tariffs, and other
trade barriers, difficulties in staffing and managing foreign operations,
longer payment cycles, different accounting practices, problems in collecting
accounts receivable, political instability, seasonal reductions in business
activity and potentially adverse tax consequences, any of which could
adversely affect the success of the Company's international operations.
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To the extent the Company expands its international operations and has
additional portions of its international revenues denominated in foreign
currencies, the Company could become subject to increased risks relating to
foreign currency exchange rate fluctuations. There can be no assurance that
one or more of the factors discussed above will not have a material adverse
effect on the Company's future international operations and, consequently, on
the Company's business, results of operations and financial condition.
2) Distribution Methods of the Products and Services
The Company will be significantly dependent on a number of third-party
relationships to supply product(s), to ship product(s), and increase traffic
to eClic.com. The Company is generally dependent on other Web site operators
that provide links to eClic.com.
The Company does not have any agreements with any Web site operators that
provide links to eClic.com, and, if the Company can established such links
the other Web site operators may terminate such links at any time without
notice to the Company. There can be no assurance that third parties will
regard their relationship with the Company as important to their own
respective businesses and operations.
There can be no assurance that the Company will ever develop a relationships
with third parties that supply the Company with links to their Web site. In
particular, the elimination of a pre-installed bookmark on a Web browser that
directs traffic to the Company's Web site could significantly reduce traffic
on the Company's Web site, which would have a material adverse effect on the
Company's business, results of operations and financial condition.
Additionally, at this time, the Company has not entered into any agreements
with any suppliers to ship and provide products.
3) Status of Any Announced New Product or Service
The Company does not have any announced new product or service. If the
Company can find a supplier to market their products through the Company's
Internet site, then these would be considered new products marketed by the
company. The Company, however, has yet to announce any new products and has
not announced any other recent additions or services.
4) Industry Background
Global commerce and the online exchange of information is new and evolving,
it is difficult to predict with any assurance whether the Web will prove to
be a viable commercial marketplace in the long term. The Web has
experienced, and is expected to continue to experience, significant growth in
the numbers of users and amount of traffic. To the extent that the Web
continues to experience increased numbers of users, frequency of use or
increased bandwidth requirements of users, there can be no assurance that the
Web infrastructure will continue to be able to support the demands placed on
it by this continued growth or that the performance or reliability of the Web
will not be adversely affected.
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Industry estimates that spending on Internet advertising in the United States
will grow from $940 million in 1997 to $7.7 billion in 2002. The Internet has
become a compelling advertising vehicle that provides advertisers with
targeting tools not available from traditional advertising media. The
interactive nature of the Internet and the development of "click-through"
advertising banners and other feedback tools enable advertisers to measure
impression levels, establish a dialogue with users and receive "real-time"
direct feedback from their target markets.
Such feedback provides advertisers with an effective means to measure the
attractiveness of their offerings among targeted audiences and make
modifications to their advertising campaigns on short notice. Community sites
are generally able to provide advertisers significantly more information
regarding consumers than other Web sites because they collect detailed
demographic data and facilitate the development of user-created affinity
groups. The ability to target advertisements to broad audiences, specific
regional populations, affinity groups or individuals makes community Web site
advertising a highly versatile and effective tool for delivering customized
and cost-effective messages. One indicator of the Internet's popularity as
an advertising medium is the growing number and diversity of Internet
advertisers.
Most early Internet advertisers were technology and Internet-related
companies. Today, a growing number of Internet advertisers consist of
traditional, consumer product and service companies. The diverse audience of
users accessing community sites has made such sites especially attractive to
consumer product and service companies advertising on the Internet. The
Company believes that this trend should continue, and that a wide variety of
companies outside the technology and Internet industries, such as financial
services, consumer goods, automotive and pharmaceutical companies, are or
will be increasingly using the Internet, and community sites in particular,
to advertise.
Furthermore, the Web has experienced a variety of outages and other delays
as a result of damage to portions of its infrastructure, and could face such
outages and delays in the future, including outages and delays resulting from
the inability of certain computers or software to distinguish dates in the
21st century from dates in the 20th century. These outages and delays could
adversely affect the level of Web usage and also the level of traffic for
eClic, Inc. In addition, the Web could lose its viability due to delays in
the development or adoption of new development or adoption of new standards
and protocols to handle increased levels of activity or due to increased
governmental regulation.
The Internet allows marketers to collect meaningful demographic information
and feedback from consumers, and to rapidly respond to this information with
new messages. This offers a significant new opportunity for businesses to
increase the effectiveness of their direct marketing campaigns. In
traditional media, a significant portion of all advertising budgets are spent
on direct marketing because of its effectiveness. However, the effectiveness
of direct marketing campaigns is dependent upon the quality of consumer data
used to develop and place complementary products, services or facilities
are developed and the Web becomes a viable commercial marketplace in the long
term, the Company might be required to incur substantial expenditures in
order to adapt its products to changing Web technologies, which could have a
material adverse effect on the Company's business, results of operations and
financial condition.
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(a) E-Commerce and Direct Marketing.
The Internet has become a significant marketplace for buying and selling
goods and services. Industry estimates that the amount of goods or services
purchased in online consumer transactions will grow from approximately $2.6
billion in 1997 to approximately $37.5 billion in 2002. Improvements in
security, interface design and transaction-processing technologies have
facilitated an increase in online consumer transactions. Early adopters of
such improvements include online merchants offering broad product catalogs
(such as books, music CDs and toys), those seeking distribution efficiencies
(such as PCs, flowers and groceries) and those offering products and services
with negotiable pricing (such as automobiles and mortgages). The Company
believes that as the volume of online transactions increases, traditional
retailers will offer a wide variety of products and services online. The
Company believes that online companies provide businesses an opportunity
to link Internet customers with like interests. The Internet allows marketers
to collect meaningful demographic information.
The Company's business strategy relies on advertising by and agreements with
other Internet companies. Any significant deterioration in general economic
conditions that adversely affected these companies could also have a material
adverse effect on the Company's business, results of operations and financial
condition.
5) Raw Materials and Suppliers
The Company is a Internet e-Commerce business, and thus does not use
any raw materials or have any principal suppliers of raw materials.
6) Customers
The Company believes that establishing and maintaining brand identity is a
critical aspect of its efforts to attract new customers, Internet traffic and
advertising and commerce relationships. In order to attract new customers,
advertisers and commerce vendors, and in response to competitive pressures,
the Company intends to make a commitment to the creation and maintenance of
brand loyalty among these groups. The Company plans to accomplish this,
although not exclusively, through advertising its Web site through the
various search engines, through other Web sites, marketing its site to
businesses/customers through e-mail, online media, and other marketing and
promotional efforts.
There can be no assurance that brand promotion activities will yield
increased revenues or that any such revenues would offset the expenses
incurred by the Company in building its brands. Further, there can be no
assurance that any new users attracted to eClic.com will conduct transactions
over eClic.com on a regular basis. If the Company fails to promote and
maintain its brand or incurs substantial expenses in an attempt to promote
and maintain its brand or if the Company's existing or future strategic
relationships fail to promote the Company's brand or increase brand
awareness, the Company's business, results of operations and financial
condition would be materially adversely affected.
13
<PAGE>
7) Patents, Trademarks, Licenses, Franchises, Concessions, Royalty
Agreements, or Labor Contracts
The Company regards substantial elements of its future Web site and
underlying infrastructure and technology as proprietary and attempts to
protect them by relying on trademark, service mark, copyright and trade
secret laws and restrictions on disclosure and transferring title and other
methods. The Company plans to enter into confidentiality agreements with its
future employees, future suppliers and future consultants and in connection
with its license agreements with third parties and generally seeks to control
access to and distribution of its technology, documentation and other
proprietary information. Despite these precautions, it may be possible for a
third party to copy or otherwise obtain and use the Company's proprietary
information without authorization or to develop similar technology
independently.
Legal standards relating to the validity, enforceability and scope of
protection of certain proprietary rights in Internet-related businesses are
uncertain and still evolving, and no assurance can be given as to the future
viability or value of any of the Company's proprietary rights. There can be
no assurance that the steps taken by the Company will prevent misappropriation
or infringement of its proprietary information, which could have a material
adverse effect on the Company's business, results of operations and financial
condition. Litigation may be necessary in the future to enforce the Company's
intellectual property rights, to protect the Company's trade secrets or to
determine the validity and scope of the proprietary rights of others. Such
litigation might result in substantial costs and diversion of resources and
management attention. Furthermore, there can be no assurance that the
Company's business activities will not infringe upon the proprietary rights
of others, or that other parties will not assert infringement claims against
the Company, including claims that by directly or indirectly providing
hyperlink text links to Web sites operated by third parties. Moreover, from
time to time, the Company may be subject to claims of alleged infringement by
the Company or service marks and other intellectual property rights of third
parties. Such claims and any resultant litigation, should it occur, might
subject the Company to significant liability for damages, might result in
invalidation of the Company's proprietary rights and, even if not meritorious,
could result in substantial costs and diversion of resources and management
attention and could have a material adverse effect on the Company's business,
results of operations and financial condition.
8) Regulation
The law relating to the liability of online companies is currently unsettled.
It is possible that claims could be made against online e-Commerce companies
under both United States and foreign law for defamation, libel, invasion of
privacy, negligence, copyright or trademark infringement, or other theories
based on the nature and content of the materials disseminated through their
Web site. Several private lawsuits seeking to impose such liability upon
other online companies are currently pending. eClic had originally planned
to sell and market prescription mediations through its website; however,
new government regulations have prohibited selling these products through
websites.
14
<PAGE>
9) Effect of Existing or Probable Government Regulations
Government legislation has been proposed that imposes liability for or
prohibits the transmission over the Internet of certain types of information.
The imposition upon the Company and other online providers of potential
liability for information carried on or disseminated through their services
could require the Company to implement measures to reduce its exposure to such
liability, which may require the Company to expend substantial resources
and/or to discontinue certain service offerings. In addition, the increased
attention focused upon liability issues as a result of these lawsuits and
legislative proposals could impact the growth of Internet use.
The Company does not believe that such regulations, which were adopted prior
to the advent of the Internet, govern the operations of the Company's
business nor have any claims been filed by any state implying that the
Company is subject to such legislation. There can be no assurance, however,
that State government will not attempt to impose these regulations upon the
Company in the future or that such imposition will not have a material
adverse effect on the Company's business, results of operations and
financial condition. Several States have also proposed legislation that would
limit the uses of personal user information gathered online or require online
services to establish privacy policies. The Federal Trade Commission has also
recently settled a proceeding with one online service regarding the manner in
which personal information is collected from users and provided to third
parties. Changes to existing laws or the passage of new legislation,
could create uncertainty in the marketplace that could reduce demand for the
services of the Company or increase the cost of doing business as a result of
litigation costs or increased service delivery costs, or could in some other
manner have a material adverse effect on the Company's business, results of
operations and financial condition. In addition, because the Company's
services are accessible worldwide, and the Company may facilitate sales of
goods to users worldwide, other jurisdictions may claim that the Company
is required to qualify to do business as foreign corporation in particular
state or foreign country.
Due to the increasing popularity and use of the Internet and other online
services, it is possible that a number of laws and regulations may be adopted
with respect to the Internet or other online services covering issues such as
user privacy, freedom of expression, pricing, content and quality of products
and services, taxation, advertising, intellectual property rights and
information security. Although sections of the Communications Decency Act of
1996 (the "CDA") that, among other things, proposed to impose criminal
penalties on anyone distributing "indecent" material to minors over the
Internet, were held to be unconstitutional by the U.S. Supreme Court, there
can be no assurance that similar laws will not be proposed and adopted.
Certain members of Congress have recently discussed proposing legislation
that would regulate the distribution of "indecent" material over the Internet
in a manner that they believe would withstand challenge on constitution law.
15
<PAGE>
Any new legislation or regulation, or the application of laws or regulations
from jurisdictions whose laws do not currently apply to the Company's
business, for third-party activities and jurisdiction. The adoption of new
laws or the application of existing laws may decrease the growth in the use
of the Internet, which could in turn decrease the demand for the Company's
services, increase the Company's cost of doing business or otherwise have a
material adverse effect on the Company's business, results of operations and
financial condition.
The Company does not believe that such regulations, which were adopted prior
to the advent of the Internet, govern the operations of the Company's
business nor have any claims been filed by any state implying that the
Company is subject to such legislation. There can be no assurance, however,
that State government will not attempt to impose these regulations upon the
Company in the future or that such imposition will not have a material
adverse effect on the Company's business, results of operations and
financial condition.
10) Research and Development Activities
The Company, among other things, plans to develop and market its Web site,
enhance its brands, implement and execute its business and marketing strategy
successfully, continue to develop and upgrade its technology and information-
processing systems, meet the needs of a changing market, provide superior
customer service, respond to competitive developments and attract, integrate,
retain and motivate qualified personnel provided the company can generate
sales and profit.
The Company also needs to develop and identify products that achieve
market acceptance by its users and e-Commerce customers. There can be no
assurance that any Internet company, including eClic.com, will achieve
market acceptance. Accordingly, no assurance can be given that the Company's
business model will be successful or that it can sustain revenue growth or
be profitable. The market for Internet products is new, rapidly developing
and characterized by an increasing number of market entrants. As is typical
of any new and rapidly evolving market, demand and market acceptance for
recently introduced products are subject to a high level of uncertainty and
risk. Moreover, because this market is new and rapidly evolving, it is
difficult to predict its future growth rate, if any, and its ultimate size.
If the market fails to develop, develops more slowly than expected or becomes
saturated with competitors, or if the Company's products do not achieve or
sustain market acceptance, the Company's business, results of operation may
be materially and adversely affected.
There can be no assurances the Company will be successful in accomplishing
all of these things, and the failure to do so could have a material adverse
effect on the company's business, results of operations and financial
condition.
11) Impact of Environmental Laws
The Company is not aware of any federal, state or local environmental laws
which would effect is operations.
16
<PAGE>
12) Employees
The Company currently has two (2) employees: one President, and one
Secretary. The Company has no intention at this time to add employees.
(i) The Company's performance is substantially dependent on the performance of
its corporate secretary, Skyelan Rose. In particular, the Company's success
depends on her ability to develop, design and market the company's Web site
through the various Internet search engines.
(ii) The Company does not carry key person life insurance on any of its
personnel. The loss of the services of any of its executive officers or other
key employees could have a material adverse effect on the business, results of
operations and financial condition of the Company. The Company's future
success also depends on its ability to retain and attract highly qualified
technical and managerial personnel.
(iii) There can be no assurance that the Company will be able to retain its
key managerial and technical personnel or that it will be able to attract and
retain additional highly qualified technical and managerial personnel in the
future. The inability to attract and retain the technical and managerial
personnel necessary to support the growth of the Company's business, due to,
among other things, a large increase in the wages demanded by such personnel,
could have a material adverse effect upon the Company's business, results of
operations and financial condition.
13) Year 2000 Implications
The Year 2000 issue is the potential for system and processing failures of
date-related data and the result of computer-controlled systems using two
digits rather than four to define the applicable year. For example,
computer programs that have time-sensitive software may recognize a date
using "00" as the year 1900 rather than the year 2000. This could result in
system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transaction
The Company may be affected by Year 2000 issues related to non-compliant
information technology ("IT") systems or non-IT systems operated by the
Company or by third parties.
The Company plans to design its own Web site, utilizing software from
Microsoft, titled Front Page. This is the only system the company
assessed for Year 2000 compliance. Company has not completed any assessment
of internal and external (third-party) IT systems and non-IT systems. At this
point, the Company is not currently aware of any Year 2000 problems relating
to systems operated by the Company or by third parties that would have a
material effect on the Company's business, results of operations or
financial condition, without taking into account the Company's efforts to
avoid such problems. Based on its assessment to date, the Company does not
anticipate that costs associated with remediating the Company's non-compliant
IT systems or non-IT systems will be material, although there can be no
assurance to such effect.
17
<PAGE>
Such a failure could prevent the Company from operating its business, prevent
users from accessing the Company's Web site, or change the behavior of
advertising customers or persons accessing the Company's Web site.
The Company believes that the primary business risks, in the event of such
failure, would include, but not be limited to, lost of potential revenues,
increased operating costs, loss of customers or persons accessing the
Company's Web site, or other business interruptions of a material nature, as
well as claims of mismanagement, misrepresentation, or breach of contract,
any of which could have a material adverse effect on the Company's business,
results of operations and financial condition.
14) The Industry & Potential Effect on the Company's Plan of Operations
The rapid adoption of the Internet as a means to gather information,
communicate, interact and be entertained, combined with the vast
proliferation of Web sites, has made the Internet an important new mass
medium. Industry estimates that the number of Web users exceeded 68 million in
1997, and will grow to over 319 million by 2002. The Internet enables
advertisers to target advertising campaigns utilizing sophisticated databases
of information on the users of various sites. As a result, the Internet has
become a compelling means to advertise and market products and services. With
the volume of sites and vast abundance of information available on the
Internet, users are increasingly seeking an online home where they can
interact with others with similar interests and quickly find information,
products and services related to a particular interest or need.
These community sites offer a single location where users can build their
personal Web sites and place them among the sites of others having similar
interests. In addition, community sites generally offer services including
access to e-mail accounts, chat rooms, news, and entertainment services,
among other features. By satisfying the needs of its users, communities seek
to establish a close relationship with their audience. As a result, the
Company believes that users tend to be loyal to and spend more time online at
community sites. The Company hopes to advertise their products at these
community sites.
The market for Internet products and services is characterized by rapid
technological developments, evolving industry standards and customer demands,
and frequent new product introductions and enhancements. These market
characteristics are exacerbated by the emerging nature of the market and the
fact that many companies are expected to introduce new Internet products and
services in the near future. The Company's future success will depend in
part on its ability to continually improve the performance, features and
reliability of the site in response to both evolving demands of the
marketplace and competitive product and service offerings; and, there can be
no assurance that the Company will be successful in doing so. Accordingly,
the Company's future success will depend on its ability to adapt to rapidly
changing technologies, to adapt to evolving industry standards and to
continually improve the performance, features and reliability of its service
in response to competitive service and product offerings and evolving demands
of the marketplace. The failure of the Company to adapt to such changes would
have a material adverse effect on the Company's business, results of
operations and financial condition. In addition, the widespread adoption of
new Internet, networking or telecommunications technologies or other
technological changes could require substantial expenditures by the Company
to modify or adapt its services or infrastructure, which could have a
material adverse effect on the Company's business, results of operations and
financial condition.
18
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY.
The Company's corporate headquarters are located at: 8555 W. Sahara, Suite 130,
Las Vegas, NV 89117, Phone: 888-971-1336. The office space is provided by
one of the Directors of the Company at no cost to the Company.
ITEM 3. LEGAL PROCEEDINGS.
As of the date hereof, eClic, Inc. is not a party to any material
legal proceedings, and none are known to be contemplated against eClic,
Inc.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year ended December 31, 1999.
19
<PAGE>
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(i) Market Information
- ----------------------
The common stock of the Company is currently not traded on the NASDAQ OTC
Bulletin Board or any other formal or national securities exchange. There is
no trading market for the Company's Common Stock at present and there has
been no trading market to date.
(a) There is currently no Common Stock which is subject to outstanding
options or warrants to purchase, or securities convertible into, the
Company's common stock.
(b) There is currently no common stock of the Company which could be sold
under Rule 144 under the Securities Act of 1933 as amended or that the
registrant has agreed to register for sale by security holders.
(ii) Holders
- ------------
The approximate number of holders of record of common stock as of December 31,
1999 was approximately forty-one (41).
(iii) Dividends
- ---------------
Holders of common stock are entitled to receive such dividends as the board of
directors may from time to time declare out of funds legally available for the
payment of dividends. No dividends have been paid on our common stock, and we
do not anticipate paying any dividends on our common stock in the foreseeable
future.
(iv) Recent Sales of Unregistered Securities
- --------------------------------------------
On April 5, 1999, the Company completed a public offering of shares of common
stock of the Company pursuant to Regulation D, Rule 504 of the Securities Act
of 1933, as amended, whereby it sold 500,000 shares of the Common Stock of
the Company to 40 unaffiliated shareholders of record. The Company filed an
original Form D with the Securities and Exchange Commission on or about March
22, 1999. As of April 5, 1999, the Company has 1,500,000 shares of common
stock issued and outstanding held by approximately 41 shareholders of record.
20
<PAGE>
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
(i) General
- -----------
We will continue to devote the major portion of our resources to the the
development of an interactive website.
Additionally, the Company plans to seek advertisers, to advertise their
product(s) on the Company's Web site. For any advertisers on the Company's
Web site, the Company will provide a link to the advertisers' Web site and
charge a customary/nominal fee, for each customer who links to their
advertisers Web site.
The Company has a limited operating history upon which an evaluation of the
Company, its current business and its prospects can be based, each of which
must be considered in light of the risks, expenses and problems frequently
encountered by all companies in the early stages of development, and
particularly by such companies entering new and rapidly developing markets
like the Internet. The Company's prospects must be considered in light of
the risks, uncertainties, expenses and difficulties frequently encountered by
companies in their early stages of development, particularly companies in new
and rapidly evolving markets such as online commerce. Such risks include,
without limitation, the lack of broad acceptance of the company's products on
the Internet, the possibility that the Internet will fail to achieve broad
acceptance, the inability of the Company to generate significant e-Commerce
based revenues from Internet customers, the company's inability to
anticipate and adapt to a developing market, the failure of the company's
network infrastructure (including its server, hardware and software) to
efficiently handle its Internet traffic, changes in laws that adversely
affect the company's business, the ability of the Company to manage its
operations, including the amount and timing of capital expenditures and other
costs relating to the expansion of the company's operations, the introduction
and development of different or more extensive communities by direct and
indirect competitors of the Company, including those with greater financial,
technical and marketing resources, the inability of the Company to maintain
and increase levels of traffic on its Web site, the inability of the Company
to attract, retain and motivate qualified personnel and general economic
conditions.
The Company has not achieved revenues or profitability to date, and the Company
anticipates that it will continue to incur net losses for the foreseeable
future. The extent of these losses will depend, in part, on the amount of
growth in the Company's revenues from sales of its products, and possibility
advertising revenues on its Web site. As of December 31, 1999, the Company had
an accumulated deficit of ($21,490) dollars. The Company expects that its
operating expenses will increase significantly during the next several months,
especially in the areas of sales and marketing, and brand promotion. Thus,
the Company will need to generate increased revenues to achieve profitability.
To the extent that increases in its operating expenses precede or are not
subsequently followed by commensurate increases in revenues, or that the
Company is unable to adjust operating expense levels accordingly, the Company's
business, results of operations and financial condition would be materially
and adversely affected. There can be no assurances that the Company can
achieve or sustain profitability or that the Company's operating losses will
not increase in the future.
21
<PAGE>
The Company's future success is substantially dependent upon continued growth
in the use of the Internet. To generate product sales, advertising sales,
e-Commerce service fees for eClic, Inc., the Internet's recent and rapid
growth must continue, and e-Commerce on the Internet must become widespread.
None of these can be assured. The Internet may prove not to be a viable
commercial marketplace. Additionally, due to the ability of consumers to
easily compare prices of similar products or services on competing Web sites,
gross margins for e-Commerce transactions may narrow in the future and,
accordingly, the Company's revenues from e-Commerce arrangements may be
materially negatively impacted. If use of the Internet does not continue to
grow, the Company's business, results of operations and financial condition
would be materially and adversely affected. Additionally, to the extent that
the Internet continues to experience significant growth in the number of
users and the level of use, there can be no assurance that its technical
infrastructure will continue to be able to support the demands placed upon
it. The necessary technical infrastructure for significant increases in
e-Commerce, such as a reliable network backbone, may not be timely and
adequately developed. In addition, performance improvements, such as
high-speed modems, may not be introduced in a timely fashion. Furthermore,
security and authentication concerns with respect to transmission over the
Internet of confidential information, such as credit cared numbers, may
remain. Issues like these could lead to resistance against the acceptance of
the Internet as a viable commercial marketplace. Also, the Internet could
lose its viability due to delays in the development or adoption of new
standards and protocols required to handle increased levels of activity, or
due to increased governmental regulation. Changes in or insufficient
availability of telecommunications services could result in slower response
times and adversely affect usage of the Internet. Demand and market
acceptance for recently introduced services and products over the Internet
are subject to a high level of uncertainty, and there exist few proven
services and products.
(ii) Results of Operations
- --------------------------
As a developmental stage Company, the Company has generate $775 in revenues.
This was entirely from a test program, which was later abandoned. The Company
does not expect to generate any significant revenues over the next
approximately to twelve (12) months. During calendar year, 1999, the Company
experienced net losses $21,490. The bulk of these expenses were for general
and administrative costs, accounting purposes, and filing fees. The Company
does not have any material commitments for capital expenditures. eClic had
originally planned to sell and market prescription mediations through its
website; however, new government regulations have prohibited selling these
products through websites. The Company is now in the process of developing
a new market strategy.
(iii) Liquidity and Capital Resources
- -------------------------------------
On April 5, 1999, the Company completed a public offering of shares of common
stock of the Company pursuant to Regulation D, Rule 504 of the Securities Act
of 1933, as amended, whereby it sold 500,000 shares of the Common Stock of
the Company to 40 unaffiliated shareholders of record. The Company filed an
original Form D with the Securities and Exchange Commission on or about March
22, 1999. As of April 5, 1999, the Company has 1,500,000 shares of common
stock issued and outstanding held by approximately 41 shareholders of record.
The Company is a development stage Internet e-Commerce company with a
principal business objective to sell and market health related products or
products which offer the Company potential revenues, and generate advertising
revenues from other vendors who sell and market products through the World
Wide Internet.
The Company currently has 2 employees who are both officers and directors of
the Company. These employees received no compensation through December 31,
2000. The Company does not plan to hire any additional employees until it
can become an profitable entity. (See employment agreements in 10-SB12G).
The Company has no material commitments for capital expenditures nor does it
foresee the need for such expenditures over the next year.
22
<PAGE>
The Company has limited financial resources available, which has had an
adverse impact on the Company's liquidity, activities and operations. These
limitations have adversely affected the Company's ability to obtain certain
projects and pursue additional business. There is no assurance that the
proceeds of the Company will be able to raise sufficient funding to enhance
the Company's financial resources sufficiently to generate volume for the
Company.
(iv) Year 2000 Issue
- --------------------
We are not currently utilizing any electronic processing systems and
Therefore we are not directly at risk for having systems that will not
recognize the Year 2000 ("Y2K") or treat any date after December 31,
1999 as a date during the twentieth century. However, no assurances can
be given that we will be able to avoid all Y2K problems, especially those
that might originate with third parties with whom we transact business,
such as financial institutions, and we have not undertaken any investigation
to determine the Y2K readiness of such parties. If we or any third party
with whom we do business were to have a Y2K problem, our business could be
disrupted and our financial condition and results of operations could be
materially adversely affected.
23
<PAGE>
ITEM 7. FINANCIAL STATEMENTS.
eCLIC, Inc.
(A Development Stage Company)
Balance Sheet
as of
December 31, 1999
and
Statements of Income,
Stockholders' Equity, and
Cash Flows
for the period
March 1, 1999 (Date of Inception) to
December 31, 1999
24
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
<S> <C>
Independent Auditor's Report F-1
Balance Sheet F-2
Income Statement F-3
Statement of Stockholders' Equity F-4
Statement of Cash Flows F-5
Footnotes F-6-7
</TABLE>
See accompanying notes to financial statements.
25
<PAGE>
G. BRAD BECKSTEAD
Certified Public Accountant
330 E. Warm Springs
Las Vegas, NV 89119
702.528.1984
425.928.2877 (efax)
INDEPENDENT AUDITOR'S REPORT
March 24, 2000
Board of Directors
eCLIC, Inc.
Las Vegas, NV
I have audited the Balance Sheet of eCLIC, Inc.(the "Company") (A Development
Stage Company), as of December 31, 1999, and the related Statements of
Operations, Stockholders' Equity, and Cash Flows for the period March 1, 1999
(Date of Inception) to December 31, 1999. These financial statements are the
responsibility of the Company's management. My responsibility is to express
an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statement
presentation. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. I believe that my audit provides a
reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of ECLIC, Inc., (A Development
Stage Company), as of December 31, 1999, in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 3 to the financial
statements, the Company has had limited operations and have not commenced
planned principal operations. This raises substantial doubt about its
ability to continue as a going concern. Management's plan in regard to these
matters are also described in Note 3. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
/s/ G. Brad Beckstead, CPA
- ---------------------------
G. BRAD BECKSTEAD
Certified Public Accountant
330 E. Warm Springs
Las Vegas, NV 89119
702.528.1984
425.928.2877 (efax)
F-1
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Balance Sheet
December 31, 1999
<TABLE>
<CAPTION>
BALANCE SHEET
Assets
<S> <C>
Cash $19,097
Web development costs, net 11,267
Total Assets $30,364
Liabilities and Stockholders' Equity
Common stock, $0.001 par value,
20,000,000 shares authorized; 1,500,000
shares issued and outstanding at 12/31/99 1,500
Preferred stock, $0.001 par value,
5,000,000 shares authorized; none
issued and outstanding at 12/31/99 -0-
Additional paid-in capital 50,354
Deficit accumulated during development stage (21,490)
Total Stockholders' Equity 30,364
Total Liabilities and Stockholders' Equity $30,364
</TABLE>
See accompanying notes to financial statements.
F-2
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Income Statement
For the period
March 1, 1999 (Date of Inception) to
December 31, 1999
<TABLE>
<CAPTION>
INCOME STATEMENT
March 1, 1999
(Inception) to
December 31, 1999
<S> <C>
Revenue $ 775
Costs and Expenses:
Research and development 3,650
General and administrative expenses 16,882
Amortization 1,733
Total Costs and Expenses 22,265
Net loss $ (21,490)
Weighted average number of
common shares outstanding 1,500,000
Net (loss) per share $ (.01)
</TABLE>
See accompanying notes to financial statements.
F-3
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the period
ended December 31, 1999
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Deficit
Accumulated Total
Addit'l During Stock-
Common Stock Paid-in Development holders'
Shares Amt. Capital Stage Deficit
---------------------------------------------------------
<S> <C> <C> <C> <C> <C>
December 31,
1999 Founders
shares issued
for cash 1,000,000 1,000.00 50,354.00 1,000.00
December 31,
1999 Shares
issued pursuant
to Reg. D, 504
offering 500,000 500.00 50,354.00 50,854.00
Net Loss,
March 1, 1999
(inception) to
December 31, 1999 (21,490.00) (21,490.00)
Balance as
of December 31,
1999 1,500,000 1,500.00 50,354.00 (21,490.00) 30,364.00
===========================================================
</TABLE>
See accompanying notes to financial statements.
F-4
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Statement of Cash Flows
For the period
ended December 31, 1999
<TABLE>
<CAPTION>
STATEMENT OF CASH FLOWS
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss (21,490)
Increase in web development costs, net (11,267)
Net cash used by operating activities (32,757)
CASH FLOWS FROM INVESTING ACTIVITIES
Net cash used by investing activities -0-
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of capital stock 1,500
Additional paid-in capital 50,354
Net cash provided by financing activities 51,854
Beginning cash, Ended -0-
Ending cash, December 31, 1999 19,097
NON-CASH TRANSACTIONS
Interest expense -0-
Income taxes -0-
</TABLE>
See accompanying notes to financial statements.
F-5
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Footnotes
December 31, 1999
Note 1 - History and organization of the company
The Company was organized March 1, 1999 (Date of Inception) under the laws
of the State of Nevada, as eCLIC, Inc. The Company has limited operations
and in accordance with SFAS #7, the Company is considered a development stage
company.
Note 2 - Summary of significant accounting policies
Accounting policies and procedures have not been determined except as follows:
1. The Company uses the accrual method of accounting.
2. 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 significantly from those
estimates.
3. The Company maintains a cash balance in a non-interest-bearing bank that
currently does not exceed federally insured limits. For the purpose of the
statements of cash flows, all highly liquid investments with the maturity of
three months or less are considered to be cash equivalents. There are no
cash equivalents as of December 31, 1999.
4. Earnings per share (EPS) is computed using the weighted average number of
shares of common stock outstanding during the period. Diluted EPS is
computed by dividing net income by the weighted average shares outstanding,
assuming all dilutive potential common shares were issued. Since the
Company has no common shares that are potentially issuable, such as stock
options, convertible preferred stock and warrants, basic and diluted EPS are
the same. The Company had no dilutive common stock equivalents such as
stock options as of December 31, 1999.
5. The Company has not yet adopted any policy regarding payment of dividends.
No dividends have been paid since inception.
6. Web development costs totaling $13,000.00 are capitalized and amortized
over a period of 60 months. Total amortization for the year ended 12/31/99
is $1,733.00.
7. The cost of equipment is depreciated over the estimated useful life of
the equipment utilizing the straight line method of depreciation.
8. The Company will review its need for a provision for federal income tax
after each operating quarter and each period for which a statement of
operations is issued.
9. The Company has adopted December 31 as its fiscal year end.
Note 3 - Income taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS #109)
"Accounting for Income Taxes". A deferred tax asset or liability is recorded
for all temporary differences between financial and tax reporting. Deferred
tax expenses (benefit) results from the net change during the year of deferred
tax assets and liabilities.
There is no provision for income taxes for the year ended December 31, 1999,
due to the net loss and no state income tax in Nevada.
F-6
<PAGE>
eCLIC, Inc.
(A Development Stage Company)
Footnotes
December 31, 1999
Note 4 - Stockholders' Equity
The Company is authorized to issue 20,000,000 shares of $0.001 par value
common stock and 5,000,000 shares of $0.001 par value preferred stock.
On March 1, 1999, the Company issued 1,000,000 shares of its $0.001 par
value common stock to its directors for cash in the amount of $1,000.00.
On April 5, 1999, the Company completed a Regulation D, Rule 504 of the
Securities Act of 1933, as amended, whereby it sold 500,000 shares of its
common stock to approximately 40 unaffiliated shareholders of record. The
Company filed an original Form D with the Securities and Exchange Commission
on or about March 22, 1999. The offering raised a total of $51,854.00 of
which $500.00 is common stock, and $50,354.00 is additional paid-in capital.
There have been no other issuances of common or preferred stock.
Note 5 - Going concern
The Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company has not commenced its planned principal
operations. Without realization of additional capital, it would be unlikely
for the Company to continue as a going concern.
Note 6 - Related party transactions
The Company does not lease or rent any property. Office services are provided
without charge by a director. Such costs are immaterial to the financial
statements and, accordingly, have not been reflected therein. The officers
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.
Note 7 - Warrants and options
There are no warrants or options outstanding to acquire any additional shares
of common stock.
Note 8 - Year 2000 issue
The Year 2000 issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information
using year 2000 dates is processed. In addition, similar problems may arise in
systems which use certain dates in 1999 to represent something other than a
date. The effects of the Year 2000 issue may be experienced before, on, or
after January 1, 2000, and if not addressed, the impact on operations and
financial reporting may range from minor errors to significant system failure
which could affect an entity's ability to conduct normal business operations.
It is not possible to be certain that all aspects of the Year 2000 issue
affecting the entity, including those related to the efforts of customers,
suppliers, or other third parties will be fully resolved.
F-7
<PAGE>
- -------------------------------------------------------------------------------
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
On March 20, 2000, the Company filed Form 8-K with the United Stated
Securities and Exchange Commission, in which the Company stated in Item
4 "Changes in Registrant's Certifying Account:"
(a) Previous independent accountants
(i) On March 15, 2000, eClic, Inc. (the "Registrant")
dismissed David Coffey, CPA, as its independent
accountant effective December 31, 1999.
(ii) The report of David Coffey, CPA on the financial
statement for April 12, 1999, contained no adverse
opinion or disclaimer of opinion and were not
qualified or modified as to uncertainty, audit
scope or accounting principle. The report of David
Coffey, CPA for the period ended April 12, 1999,
has not been modified.
(iii) The Registrant's Board of Directors participated in and
approved the decision to change independent accountants.
(iv) In connection with its audit for the most recent fiscal
years and through December 31, 1999, there have been no
disagreements with David Coffey, CPA, on any matter of
accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which
disagreements if not resolved to the satisfaction of David
Coffey, CPA would have caused them to make reference
thereto in their report on the financial statements for
such years.
(v) During the most recent fiscal year and through March 15,
2000, there have been no reportable events (as defined in
in Regulation 8-K Item 304 (a) (1) (v)).
(vi) The Registrant has requested that David Coffey, CPA furnish
it with a letter addressed to the SEC stating whether or not
it agrees with the above statements. The Registrant delivered
a copy of this Form 8-K report to David Coffey, CPA on March
16, 2000. On March 17, 2000, David Coffey, copied said letter
on his letterhead, signed and returned said letter to the
Company, with the original being sent to the SEC. The
Registrant has filed, as an exhibit to this Form 8-K report,
a copy of the letter from David Coffey, CPA, addressed to the
SEC stating David Coffey, CPA is in agreement with the
statements contained in this Form 8-K report.
(b) New independent accountants
(i) The Registrant engaged G. Brad Beckstead, CPA as its new
independent accountant as of March 15, 2000. During the most
recent fiscal years and through March 15, 2000, the
Registrant has not consulted with G. Brad Beckstead, CPA on
items which (1) were or should have been subject to SAS 50
or (2) concerned the subject matter of a disagreement or
reportable event with the former auditor (as described in
Regulation S-K Item 304 (a) (2)).
26
<PAGE>
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
The following table sets forth the current officers and directors of eClic,
Inc.
<TABLE>
<CAPTION>
Name Age Position
- -------- ------ ----------
<S> <C> <C>
Justine M. Daniels 31 President, CEO
Chief Financial Officer and
Director
Skyelan Rose 40 Secretary and Director
</TABLE>
B. Work Experience
As President and CEO of eClic, Inc., Justine M. Daniels has organized and
formed the company. Justine M. Daniels is a single female, born in Sioux
Falls, SD. She has an AA Degree from Career Institute of Omaha, Nebraska.
She has a BS Degree from National College of Business, Sioux Falls, South
Dakota. She has extensive experience in the restaurant/nightclub business.
She started her career in South Dakota, Embers Restaurant. A subsequent
career opportunity took her to the Metropolitan Phoenix, Arizona area. She
handled staff training at Bobby McGee's Restaurant/nightclub, where she was
instrumental in increasing efficiencies for this establishment. She brings
to eClic, Inc., restaurant work experience in service and customer relations;
she does not have any past experience in setting up a Web Site or e-Commerce
business.
27
<PAGE>
Skyelan Rose, Corporate Secretary and Director for eClic, Inc. She is a
single female, born in North Island, California. She attended University
of Utah and University of California, Berkeley. She has eight years
experience in marketing and sales with the hotel industry. She spent
two of those eight years as Director of Marketing/Sales for Holiday Inn,
Arizona Region. She is currently an Event Planner for the Arizona Room of
America OnLine. She is former Corporate Secretary for Ionosphere, Inc., a
publicly traded company listed on the OTC Bulletin Board. This was a
consulting company engaged in the restaurant/nightclub business. She is also
Corporate Secretary of Barrington Laboratories, Inc., a Nevada Corporation,
and Boppers Holdings, Inc., a Nevada Corporation. She has developed a number
of Web sites for other companies, and has experience with various computer
applications. This will be her first endeavor in setting up an e-Commerce
company and a Web site for company where she serves as an Officer and Director.
Directors are elected in accordance with our bylaws to serve until the next
annual stockholders meeting. eClic, Inc. does not currently pay
compensation to directors for services in that capacity.
Officers are elected by the board of directors and hold office until their
successors are chosen and qualified, until their death or until they resign or
have been removed from office. All corporate officers serve at the discretion
of the board of directors. There are no family relationships between any
director or executive officer and any other director or executive officer of
EClic, Inc.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our directors and
executive officers, and persons who beneficially own more than ten percent of a
registered class of our equity securities (referred to as "reporting persons"),
to file with the Securities and Exchange Commission initial reports of
ownership and reports of changes in ownership of common stock and other
eClic, Inc. equity securities. Reporting persons are required by Commission
regulations to furnish us with copies of all Section 16(a) forms they file.
ITEM 10. EXECUTIVE COMPENSATION.
As a result of our the Company's current limited available cash, no officer or
director received compensation during the fiscal year ended December 31, 1999.
eClic, Inc. intends to pay salaries when cash flow permits. No officer
or director received stock options or other non-cash compensation during the
fiscal year ended December 31, 1999. The Company does have employment
agreements in place with each of its officer.
<TABLE>
<CAPTION>
Name Position Monthly Salary
- ---------------------------- --------- ----------------
<S> <C> <C>
Justine M. Daniels President $ 0
Skyelan Rose Secretary $ 0
</TABLE>
28
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the beneficial
ownership of our outstanding common stock as of February 29, 2000, by each
person known by eClic, Inc. to own beneficially more than 5% of the
outstanding common stock, by each of our directors and officer and by all of
our directors and officers as a group. Unless otherwise indicated below, to
our knowledge all persons listed below have sole voting and investment
power with respect to their shares of common stock except to the extent
that authority is shared by spouses under applicable law.
<TABLE>
<CAPTION>
Title Name & Address Amount of Percent
of of Beneficial shares of
Class Owner of Shares Position held by Owner Class
- ------ --------------- -------- ------------- -------
<S> <C> <C> <C> <C>
Common Justine M. Daniels(1) Chairman/ 1,000,000 79.63%
CEO
None Skyelan Rose(1) Secretary/ 0 0.00%
Director
- ---------------------------------------------------------------------
All Executive Officers and
Directors as a Group (2 persons) 1,000,000 79.63%
</TABLE>
(1) c/o eClic, Inc. 8555 W. Sahara, Suite 130, Las Vegas, NV 89117
B. Persons Sharing Ownership of Control of Shares
No person other than Justine M. Daniels, President/CEO owns or shares the
power to vote ten percent (10%) or more of the Company's securities.
C. Non-voting Securities and Principal Holders Thereof
The Company has not issued any non-voting securities.
D. Options, Warrants and Rights
There are no options, warrants or rights to purchase securities of the
Company.
E. Parents of Issuer
Under the definition of parent, as including any person or business entity
who controls substantially all (more than 80%) of the issuers of common
stock, the Company has no parents.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
By Corporate Resolution, the Company hired the services of Stude's, L.L.C.
and MQ Holdings, Inc. Stude's, L.L.C., an Arizona Limited Liability
Company was hired to handle the filing of Company documents, e.g., Articles
of Incorporation and this Registration. Stude's, L.L.C. is a registered
filing agent with the SEC (CIK#0001079372). The Company does not have any
formal contract with Stude's, L.L.C. and pays this L.L.C on a fee for service
basis. Its fees are below customary industry standards. The sole managing
member of Stude's, L.L.C. is T. J. Jesky. He is also the Resident Agent of
the Company. He beneficially owns four thousand six hundred (4,600) shares of
Common Stock, purchased during the offering period at $0.10 (ten cents) per
share. This represents 0.0031 of the outstanding shares. He has three
family members who also purchased Common Stock during the offering period at
29
<PAGE>
$0.10 (ten cents) per share. Collectively, these other family members
purchased two thousand two hundred (2,200) shares (0.0015) of the outstanding
stock in the Company. Together all related family members own six thousand
eight hundred (6,800) shares of Common stock, or 0.0045 of the outstanding
shares. This represents less than one-half of one percent of the Company.
The Company also hired the services MQ Holdings, Inc., a Nevada Corporation,
to prepare the offering document. Its fees are below customary industry
standards. The Company does not have any formal contract with MQ Holdings
and pays this company on a fee for service basis. MQ Holdings, Inc. is
run by Mark DeStefano, who purchased four thousand (4,000) shares (0.0027)
of Common Stock during the public offering at $0.10 (ten cents per share).
Ed DeStefano, the father of Mark DeStefano, purchased one thousand (1,000)
shares (0.0007) of Common Stock in the Company which he purchased at $0.10
(ten cents) per share during this offering period. Their total holdings
in eClic, Inc., Common Stock represent one-third of one percent (0.0033)
of the outstanding shares.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
(a) EXHIBITS.
The following documents are included or incorporated by reference as exhibits
to this report:
EXHIBIT
NO. DOCUMENT DESCRIPTION
- ------- ----------------------------------------------------------------------
(3) ARTICLES OF INCORPORATION AND BY-LAWS
3.1 Articles of Incorporation of the Company Filed March 1, 1999(1)
3.2 By-Laws of the Company adopted March 2, 1999(1)
(4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS
4.1 Facsimile of specimen common stock certificate(1)
(10)
10.1 Employment Agreement with J. M. Daniels(1)
10.2 Employment Agreement with Skyelan Rose(1)
(23) CONSENT OF EXPERTS AND COUNSEL
23.1 Letter of Consent from David Coffey, CPA(1)
(27) FINANCIAL DATA SCHEDULE
27.1 Financial Data Schedule
- ----------
(1) Previously filed as an exhibit to our registration statement on Form 10-SB
(the "Registration Statement"), which was filed on ?????, 1999, and
incorporated herein by reference.
30
<PAGE>
(b) REPORTS ON FORM 8-K
eClic, Inc. did not file any reports on Form 8-K during the fiscal year
ended December 31, 1999. The Company did file a Current Report dated
March 20, 2000 on Form 8-K containing information pursuant to Item 4
("Changes in Accountants") entitled "Changes in Registrant's Certifying
Account." (See Item 8 above, entitled, "Changes in and Disagreements
with Accountants on Accounting and Financial Disclosure" and Exhibit
23.2 "Letter from previous Accountant" filed on this Form 10KSB.
31
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: March 27, 2000 eClic, Inc.
By: /s/ Justine M. Daniels
-----------------------
Justine M. Daniels
President, Chief Executive Officer
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: March 27, 2000 eClic, Inc.
By: /s/ Skyelan Rose
-----------------------
Skyelan Rose
Secretary
32
<PAGE>
TYPE: EX-23.2
DAVID E. COFFEY 3651 Lindell Rd. - Suite H Las Vegas, NV 89103
- --------------------------------------------------------------------------------
Certified Public Accountant (702) 871-3979
U.S. Securities and Exchange Commission
Washington D.C. 20549
March 17, 2000
Reference: eClic, Inc.
SEC CIK: 0001085596
To Whom It May Concern:
The firm of David Coffey, Certified Public Accountant has reviewed
the statements made in Form 8-K, dated March 15, 2000, Item 4. Changes in
Registrant's Certifying Accountant. The statements made are accurate and
correct.
Professionally,
/s/ David Coffey, CPA
- --------------------------
David Coffey CPA
<PAGE>
TYPE: EX-23.3
eCLIC, INC.
EXHIBIT 23.3 Consent from G. Brad Beckstead, CPA
March 24, 2000
To Whom It May Concern:
The firm of G. Brad Beckstead, CPA, consents to the inclusion of my report of
March 24, 2000, on the Financial Statements of eCLIC, Inc. for the period
March 1, 1999 (Date of Inception) to December 31, 1999, in any filings which
are necessary now or in the near future to be filed with the US Securities
and Exchange Commission.
Signed,
/s/ G. Brad Beckstead, CPA
- --------------------------
G. Brad Beckstead, CPA
Nevada License #2701
<PAGE>
<TABLE> <S> <C>
<S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
BALANCE SHEET, THE STATEMENT OF OPERATIONS, AND THE STATEMENT OF CASH FLOWS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> MAR-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 19,097
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 19,097
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 30,364
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 1,500
<OTHER-SE> 28,864
<TOTAL-LIABILITY-AND-EQUITY> 30,364
<SALES> 0
<TOTAL-REVENUES> 775
<CGS> 0
<TOTAL-COSTS> 22,265
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (21,490)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (21,490)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
