<PAGE>
==========================
OMB APPROVAL
OMB Number: 3235-0416
Expires: May 31, 2000
Estimated average burden
hours per response: 9708.0
==========================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ____________ to _____________
Commission file number _______________________________________
Netship Fulfillment, Inc.
-------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
OKLAHOMA 52-2000360
- ------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer I.D. No.)
organization)
5550 Northeast 50th Street
Oklahoma City, Oklahoma 73121
----------------------------------------------
(Address of Principal Executive office)
Registrant's Telephone Number, Including Area Code: (949) 495-7553
Facsimile Number: (949) 495-8506
-------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section l2, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of September 30, 1999, there
are 1,202,000 shares issued and outstanding.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
<PAGE>
NETSHIP FULFILLMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Balance Sheet
(Unaudited)
SEPTEMBER 30,
1999
-------------
ASSETS
CURRENT ASSETS
Cash $ 3,961
-------------
TOTAL CURRENT ASSETS 3,961
-------------
$ 3,961
=============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES $ -
COMMITMENTS AND CONTINGENCIES -
SHAREHOLDERS' EQUITY:
Common stock, 50,000,000 shares authorized, $.001 par value,
1,202,000 shares issued and outstanding 1,202
Additional paid-in capital 121,898
Deficit accumulated during the development stage (119,139)
-------------
TOTAL SHAREHOLDERS' EQUITY 3,961
-------------
$ 3,961
=============
<PAGE>
NETSHIP FULFILLMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
CUMULATIVE
FROM INCEPTION
Nine Months ended Sept. 30, (OCTOBER 29, 1996)
----------------------------- TO SEPT. 30,
1999 1998 1999
------------- ------------- -------------
<S> <C> <C> <C>
Costs and expenses:
General and administrative $ 118,599 $ - $ 119,139
------------- ------------- -------------
NET LOSS $ (118,599) $ - $ (119,139)
============= ============= =============
BASIC AND DILUTED NET LOSS PER SHARE $ (0.11) $ -
============= =============
BASIC AND DILUTED WEIGHTED AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING 1,033,445 640,000
============= =============
</TABLE>
<PAGE>
NETSHIP FULFILLMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
CUMULATIVE
FROM INCEPTION
NINE MONTHS ENDED SEPT. 30, (OCTOBER 29, 1996)
----------------------------- TO SEPT. 30,
1999 1998 1999
------------- ------------- -------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (118,599) $ - $ (119,139)
------------- ------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 562 - 1,202
Contribution to capital 121,898 - 121,898
------------- ------------- -------------
Net cash provided by financing activities 122,460 - 123,100
------------- ------------- -------------
Net increase in cash 3,861 - 3,961
CASH, BEGINNING OF PERIOD 100 100 -
------------- ------------- -------------
CASH, END OF PERIOD $ 3,961 $ 100 $ 3,961
============= ============= =============
</TABLE>
<PAGE>
NETSHIP FULFILLMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
September 30, 1999
(Unaudited)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -----------------------------------------------------------------
The accompanying unaudited financial statements of Netship Fulfillment,
Inc. (the "Company") have been prepared in accordance with generally
accepted accounting principles for interim financial information.
Accordingly, they do not include all of the information required by
generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of
normal recurring adjustments) considered necessary for a fair presentation
have been included. Operating results for the nine months ended September
30, 1999 are not necessarily indicative of the results for any future
period. These statements should be read in conjunction with the Company's
financial statements and notes thereto for the year ended December 31,
1998.
Organization
------------
Netship Fulfillment, Inc., an Oklahoma corporation ( the "Company") was
formed on October 29, 1996 under the name Premier Partners, Inc. The
Company changed its name to Netship Fulfillment, Inc. on February 23,
1999. The Company intends to become a full service fulfillment and
distribution company, specializing in promotional and catalog fulfillment,
especially for the internet industry. The Company is classified as a
development stage company because its principal activities involve
obtaining capital. The Company is currently being funded by its
management, through donated time and office space.
Use of estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
Income taxes
------------
The Company reports certain expenses differently for financial and tax
reporting purposes and, accordingly, provides for the related deferred
taxes. Income taxes are accounted for under the liability method in
accordance with SFAS 109.
<PAGE>
NETSHIP FULFILLMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
- -----------------------------------------------------------------------------
Basic and diluted net loss per share
------------------------------------
Basic net loss per share is based upon the weighted average number of
common shares outstanding. Diluted net loss per share is based on the
assumption that all dilutive convertible shares and stock options were
converted or exercised. Dilution is computed by applying the treasury
stock method. Under this method, options and warrants are assumed to be
exercised at the beginning of the period (or at the time of issuance, if
later), and as if funds obtained thereby were used to purchase common
stock at the average market price during the period.
2. GOING CONCERN
- -------------------
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. Additional capital infusion is
necessary in order to fund current expenditures and achieve profitable
operations. This factor raises substantial doubt about the Company's
ability to continue as a going concern.
The Company's management intends to continue funding current expenditures
by means of contributions to capital and to raise additional funds through
equity offerings. However, there can be no assurance that management will
be successful in this endeavor.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
THE FOLLOWING DISCUSSION AND ANALYSIS CONTAINS FORWARD LOOKING STATEMENTS
REGARDING FUTURE EVENTS OR THE FUTURE FINANCIAL PERFORMANCE OF THE COMPANY THAT
INVOLVE CERTAIN RISKS AND UNCERTAINTIES. UNDER "FORWARD LOOKING STATEMENTS"
ACTUAL EVENTS OR THE ACTUAL FUTURE RESULTS OF THE COMPANY MAY DIFFER MATERIALLY
FROM ANY FORWARD LOOKING STATEMENT DUE TO SUCH RISKS AND UNCERTAINTIES.
OVERVIEW
- --------
Netship Fulfillment, Inc. is a development stage company. A development stage
company is one for which principal operations have not commenced. Management has
devoted most of its activities to establishing the business. Operating losses
have been incurred to date, and will continue to incur as the Company continues
to use, rather than provide, working capital in its operations. The Company
intends to become a full service fulfillment and distribution company
specializing in promotional products and catalog fulfillment, especially for the
Internet industry.
The Company will recognize revenues from the sale of its products upon shipment.
RESULTS OF OPERATIONS
- ---------------------
NET REVENUES
- ------------
As a development stage company, the Company had no revenues for the nine months
ended September 30, 1999 and September 30, 1998.
COSTS AND EXPENSES
- ------------------
Costs and expenses for the nine months ended September 30, 1999 of $118,599 were
solely related to the 504 Offering the Company undertook during the nine months
ended September 30, 1999. The Company had no costs and expenses during the nine
months ended September 30, 1998.
OTHER INCOME (EXPENSE)
- ----------------------
The Company had no other income or expenses for the nine months ended September
30, 1999 and September 30, 1998.
PROVISION FOR INCOME TAXES
- --------------------------
The Company had no income nor income taxes for the nine months ended September
30, 1999 and September 30, 1998.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Company's cash and cash equivalents increased from one-hundred dollars
($100.00) at September 30, 1998 to three thousand nine hundred sixty one dollars
($3,961) at September 30, 1999 due to contributions to capital from Officers of
the Company and proceeds related to the 504 Offering the Company undertook
during the nine months ended September 30, 1999.
There were no liabilities at September 30, 1998 or at September 30, 1999.
The Company's management currently believes that inflation has not had a
material impact on continuing operations.
YEAR 2000
- ---------
Like many other companies, the year 2000 computer issue creates risk for the
Company. The overall cost of the Company's year 2000 compliance plan is a minor
portion of the Company's anticipated total information technology budget and is
not expected to materially delay the implementation of any other unrelated
projects that are planned to be undertaken by the Company. Based on currently
available information, management does not believe that the year 2000 issue
discussed above relates to the Company's internal systems or its products sold
to customers, or that it will have a material adverse impact on the Company's
financial condition or results of operations; however, the specific extent to
which the Company may be affected by such matters is not certain. In addition,
there can be no assurance that the failure by a supplier or another third party
to ensure year 2000 compatibility would not have a material adverse effect on
the Company.
FACTORS AFFECTING FUTURE PERFORMANCE
- ------------------------------------
In connection with the Private Securities Litigation Reform Act of 1995 (the
"Litigation Reform Act"), the Company has disclosed certain cautionary
information to be used in connection with written materials that may contain
"forward-looking statements" within the meaning of the Litigation Reform Act.
Such statements consist of any statement other than a recitation of historical
fact and can be identified by the use of forward-looking terminology such as
"intend", "may", "expect", "anticipate", "estimate", or "continue" or the
negative thereof or other variations thereon or comparable terminology. The
reader is cautioned that all forward-looking statements are necessarily
speculative and there are numerous risks and uncertainties that could cause
actual events or results to differ materially from those referred to in such
forward-looking statements. The reader is cautioned that the Company does not
have a policy of updating or revising forward-looking statements and thus he or
she should not assume that silence by management over time means that actual
events are bearing out as estimated in such forward-looking statements.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not a party to any pending legal proceeding. Management
is not aware of any threatened litigation, claims or assessments.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Exhibits and Reports on Form 8-K.
There were no reports filed on Form 8-K during the three-month period
ended September 30, 1999.
Incorporation of Form 10-SB
---------------------------
The Company hereby incorporates by reference herein its Form 10-SB
filed with the U.S. Securities and Exchange Commission on June 22, 1999.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Date: November 22, 1999 By: /S/ Michael Brown
-------------------------
Michael Brown, Director
and President
Date: November 22, 1999 By: /S/ Michael Brown
-------------------------
Michael Brown, Director
Secretary/Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 3,961
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,961
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 1,202
<OTHER-SE> 2,759
<TOTAL-LIABILITY-AND-EQUITY> 3,961
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 118,599
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (188,599)
<INCOME-TAX> 0
<INCOME-CONTINUING> (188,599)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (188,599)
<EPS-BASIC> (.11)
<EPS-DILUTED> (.11)
</TABLE>
