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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 10-Q/A-1
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 31, 1999.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from: __________ to ___________.
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Commission file number 0-26909
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budgethotels.com, inc.
(Exact name of Registrant as specified in its charter.)
NEVADA 91-0179013
(State of other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1449 St. Paul Street
Suite 202
Kelowna, British Columbia V1Y 2E5
(Address of principal executive offices, including zip code.)
(250) 868-1171
Registrant's telephone number, including area code.
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Act of
1934 during the preceding 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. Not subject
to filing until September 30, 1999.
YES [ x ] NO [ ]
The number of shares outstanding of the Registrant's Common Stock,
$0.01 par value per share, at August 31, 1999 was 14,514,000 shares.
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<PAGE> 2
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Balance Sheets
ASSETS
August 31, November 30,
1999 1998
(Unaudited)
CURRENT ASSETS
Cash $ 93,193 $ 13,144
Account receivable 148,286 88,518
Accounts receivable - related party 2,161 -
--------- ---------
Total Current Assets 243,640 101,662
--------- ---------
PROPERTY AND EQUIPMENT 130,015 64,604
--------- ---------
OTHER ASSETS
Prepaids 9,296 1,477
--------- ---------
Total Other Assets 9,296 1,477
--------- ---------
TOTAL ASSETS $ 382,951 $ 167,743
========= =========
The accompanying notes are an integral part of these consolidated
financial statements.
1
<PAGE> 3
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Balance Sheets (Continued)
August 31, November 30,
1999 1998
(Unaudited)
CURRENT LIABILITIES
Accounts payable $ 3,474 $ 17,923
Accounts payable - related party 959 3,477
Unearned revenue 228,391 196,031
Note payable - related party - 44,407
---------- ----------
Total Current Liabilities 232,824 261,838
---------- ----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock: 1,000,000 shares
authorized of $0.01 par value,
no shares issued and outstanding - -
Common stock: 50,000,000 shares
authorized of $0.001 par value,
13,214,000 and 11,487,000 shares
issued and outstanding, respectively 13,214 11,487
Additional paid-in capital 834,171 61,894
Accumulated deficit (697,258) (167,476)
---------- ----------
Total Stockholders' Equity
(Deficit) 150,127 (94,095)
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT) $ 382,951 $ 167,743
========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.
2
<PAGE> 4
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Statements of Operations
(Unaudited)
For the For the
Three Months Ended Nine Months Ended
August 31, August 31,
1999 1998 1999 1998
REVENUE
Net sales $ 145,440 $ 45,764 $ 451,084 $ 326,446
Cost of goods sold 113,658 30,228 311,895 145,966
---------- -------- ---------- ---------
Gross Profit 31,782 15,536 139,189 180,480
---------- -------- ---------- ---------
EXPENSES
General and
administrative 229,990 21,924 660,043 103,979
Depreciation 2,524 2,188 7,572 6,564
---------- -------- ---------- ---------
Total Expenses 232,514 24,112 667,615 110,543
---------- -------- ---------- ---------
Income (Loss) from
Operations (200,732) (8,576) (528,426) 69,937
---------- -------- ---------- ---------
OTHER INCOME (EXPENSE)
Gain (loss) on
exchange rate (7,633) - (1,356) -
Interest income - - - 154
---------- -------- ---------- ---------
Total Other Income
(Expense) (7,633) - (1,356) 154
---------- -------- ---------- ---------
NET INCOME (LOSS) $ (208,365) $ (8,576) $ (529,782) $ 70,091
========== ======== ========== =========
BASIC EARNINGS
(LOSS) PER SHARE $ (0.01) $ (0.00) $ (0.04) $ 0.00
========== ======== ========== =========
The accompanying notes are an integral part of these consolidated
financial statements.
3
<PAGE> 5
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Statements of Stockholders' Equity (Deficit)
Additional
Common Stock Paid-in Accumulated
Shares Amount Capital Deficit
Balance, 11/30/97 8,000,000 $ 8,000 $ (8,000) $ (112,474)
Common stock issued
for services rendered
at $0.05 per share 600,000 600 27,480 -
Common stock issued
for cash at $0.01
per share 2,500,000 2,500 22,500 -
Common stock issued
for cash at $0.19
per share 387,000 387 73,200 -
Stock offering costs - - (53,286) -
Net loss for the year
ended 11/30/98 - - - (55,002)
---------- -------- ---------- ----------
Balance, 11/30/98 11,487,000 11,487 61,894 (167,476)
Cancellation of common
stock previously
issued at $0.05 per
share (600,000) (600) (27,480) -
Common stock issued
for cash at $0.25
per share 1,585,000 1,585 394,665 -
Common stock issued
for services at
$0.25 per share
(unaudited) 400,000 400 99,600 -
Common stock issued
for cash at $0.30
to $0.50 per share
(unaudited) 42,000 42 16,958 -
Options on common stock
issued below market
value at $0.25 per
share (unaudited) - - 240,000 -
Common stock issued for
services at $0.50 per
share (unaudited) 300,000 300 149,700 -
Stock offering costs
(unaudited) - - (101,166) -
Net loss for the nine
months ended 08/31/99
(unaudited) - - - (529,782)
---------- -------- ---------- ----------
Balance, 08/31/99
(unaudited) 13,214,000 $ 13,214 $ 834,171 $ (697,258)
========== ======== ========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE> 6 BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Statements of Cash Flows
(Unaudited)
For the For the
Three Months Ended Nine Months Ended
August 31, August 31,
1999 1998 1999 1998
CASH FLOWS FROM
OPERATING ACTIVITIES
Net income (loss) $ (208,365) $ (8,576) $(529,782) $ 70,091
Adjustments to reconcile
net income (loss) to
net cash used by
operating activities:
Depreciation 2,524 2,188 7,572 6,564
Common stock issued
for services - - 311,920 6,000
Changes in assets
and liabilities:
(Increase) decrease
in accounts receivable (15,730) (5,828) (59,768) (95,159)
(Increase) decrease
in accounts receivable-
related party (2,161) (6,577) (2,161) (28,764)
(Increase) decrease in
deposits and prepaids (5,296) - (7,819) (374)
Increase (decrease) in
accounts payable 2,085 27,513 (14,449) 44,225
Increase (decrease) in
accounts payable -
related party (2,518) - (2,518) -
Increase (decrease) in
bank overdraft - (2,639) - (2,639)
Increase (decrease) in
unearned revenue 27,021 - 32,360 (20,125)
-------- -------- -------- --------
Net Cash Provided (Used)
by Operating Activities (202,440) 6,081 (264,645) (20,181)
-------- -------- -------- --------
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of fixed assets (46,827) (10,905) (72,983) (47,351)
-------- -------- -------- --------
Net Cash Provided (Used)
by Investing Activities (46,827) (10,905) (72,983) (47,351)
-------- -------- -------- --------
CASH FLOWS FROM FINANCING
ACTIVITIES
Principal payments on
note payable- related
party - (22,501) (44,407) (22,501)
Proceeds from sales of
common stock 150,000 22,063 563,250 133,705
Stock offering costs - - (101,166) (22,902)
-------- -------- -------- --------
Net Cash Provided (Used)
by Financing Activities $150,000 $ (438) $417,677 $ 88,302
-------- -------- -------- --------
The accompanying notes are an integral part of these financial statements.
<PAGE> 7
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Statements of Cash Flows (Continued)
(Unaudited)
For the For the
Three Months Ended Nine Months Ended
August 31, August 31,
1999 1998 1999 1998
NET INCREASE (DECREASE)
IN CASH $ (99,267) $ (5,262) $ 80,049 $ 20,770
CASH AT BEGINNING OF PERIOD 192,460 26,032 13,144 -
--------- -------- --------- ---------
CASH AT END OF PERIOD $ 93,193 $ 20,770 $ 93,193 $ 20,770
========= ======== ========= =========
SUPPLEMENTAL CASH FLOW
INFORMATION
CASH PAID FOR:
Interest $ - $ - $ - $ -
Income taxes $ - $ - $ - $ -
NON-CASH FINANCING ACTIVITIES
Common stock issued
for services rendered $ - $ - $ 311,920 $ 6,000
The accompanying notes are an integral part of these financial
statements.
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 1 - COMPANY BACKGROUND
The consolidated financial statements include those of budgethotels.com,
inc. (BHI) (formerly known as Info Center International, Inc.) and its
wholly-owned subsidiary, Info Center, Inc. (Info). Collectively, they are
referred to herein as "the Company".
BHI was incorporated under the laws of the State of Nevada on November 5,
1997 as Info Center Interntional, Inc. BHI was incorporated for the
purpose of acquiring Info. In February 1999, the Company changed its name
from Info Center International, Inc. to budgethotels.com, inc.
Info, a wholly-owned subsidiary, was formed under the laws of the State of
Washington on November 6, 1984. Info has been in the business of operating
billboards, signboards and illuminated signs for the purpose of placing
advertisements. Info also maintains and operates an internet website for
the purpose of making hotel reservations.
On November 30, 1997, the Company completed an Agreement and Plan of Share
Exchange whereby BHI issued 8,000,000 shares of its common stock in
exchange for all of the outstanding common stock of Info. The share
exchange was accounted for as a transfer under common control since WJ
Marshall Management Inc. was the controlling shareholder or Info And BHI
prior to the share exchange. Accordingly, there was no adjustment to the
carrying value of the assets or liabilities of Info. BHI is the acquiring
entity for legal purposes and Info is the surviving entity for accounting
purposes. BHI has been in the business of operating billboards for the
purpose of placing advertisements.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A summary of the significant accounting policies consistently applied in
the preparation of the accompanying consolidated financial statements
follows:
a. Accounting Method
The Company's consolidated financial statements are prepared using the
accrual method of accounting. The Company has elected a November 30 year
end.
b. Property and Equipment
Property and equipment are recorded at cost. Major additions and
improvements are capitalized. The cost and related accumulated
depreciation of equipment retired or sold are removed from the accounts and
any differences between the undepreciated amount and the proceeds from the
sale are recorded as a gain or loss on sale of equipment. Depreciation is
computed using the straight-line method over the estimated useful lives as
follows:
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Useful
Description Lives
Advertising boards 7 years
Office furniture and equipment 7 years
Computer software 3 years
Leasehold improvements 27.5 years
c. Accounts Receivable
Accounts receivable are shown net of the allowance for doubtful accounts of
$23,695 and $23,695 at August 31, 1999 and November 30, 1998, respectively.
d. Provision for Taxes
At August 31, 1999, the Company has net operating loss carryforwards of
approximately $430,000 that may be offset against future taxable income
through 2014. No tax benefit has been reported in the consolidated
financial statements, because the Company believes there is a 50% or
greater chance the net operating loss carryforwards will not be used.
Accordingly, the potential tax benefits of the net operating loss
carryforwards are offset by a valuation allowance of the same amount.
e. Principles of Consolidation
The consolidated financial statements include those of budgethotels.com,
Inc. and its wholly-owned subsidiary, Info Center, Inc.
All material intercompany accounts and transactions have been eliminated.
f. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
g. Revenue Recognition
Revenue is recognized as service is provided to the customer. The Company
amortizes revenues over the life of the contract with the customer which
range from three months to one year. Unearned revenues reflect the
percentage of the Company's receivables and collected fees for which
services have not yet been provided.
h. Unaudited Financial Statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for a fair
presentation. Such adjustments are of a normal, recurring nature.
8
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 3 - PROPERTY AND EQUIPMENT
Property and equipment consists of the following:
August 31,
1999
Advertising boards $ 100,198
Office furniture and equipment 28,905
Computer software 9,642
Leasehold improvements 12,714
---------
151,459
Accumulated depreciation (65,747)
---------
Net property and equipment $ 130,015
=========
Depreciation expense for the nine months ended August 31, 1999 was $7,572.
NOTE 4 - COMMITMENTS AND CONTINGENCIES
In October 1997, the Company entered into an agreement for consulting
services. The agreement runs from October 1997 through January 2001. The
monthly payment for the consulting agreement is $2,000.
In March 1999, the Company entered into an agreement with its president
for consulting services. The agreement runs from March 1999 through March
2014. The monthly payment for the consulting agreement is $10,000.
The Company leases certain office equipment used in their operations. The
lease terms expire beginning in April 2001 and ending in January 2003. The
monthly rental payment for the leases is $553.
The Company leases office space located in Kelowna, British Columbia. The
lease term is for one year and expires in December 1998. The monthly lease
payment on the office is $749.
9
<PAGE> 11
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 4 - COMMITMENTS AND CONTINGENCIES
During April 1997, the Company entered into an operating lease agreement
for an automobile. The lease term expires in March 2001. The monthly
rental payment is $579.
Minimum future lease payments on the leases as of August 31, 1999 are as
follows:
Year Ended
November 30, Amount
1999 $ 40,851
2000 40,851
2001 11,989
2002 3,640
2003 and thereafter -
--------
Total $ 97,331
========
NOTE 5 - RELATED PARTY TRANSACTIONS
As of November 30, 1998, the Company owed $44,407 to the Company's
President. Interest accrued on the amount at 10% per annum and was due
yearly. The principal was due on demand. This note was repaid in full by
the Company during the year ended November 30, 1999. The Company has
advanced to a major shareholder $2,161 against future commissions at August
31, 1999.
NOTE 6 - LICENSING AGREEMENT
In October 1997, the Company entered into a licensing agreement with
Greyhound Lines, Inc. (Greyhound), whereby the Company is granted the right
to install, operate and maintain its advertising boards in all of
Greyhounds's owned and leased bus terminal facilities. The agreement is
for a period of 15 years (three 5 year terms) beginning in February 1998.
The cost to the Company ranges from $50 to $367 per month for each location
where an advertising board is placed.
NOTE 7 - COMMON STOCK
In December 1997, the Company sold 2,500,000 shares of its common stock in
an offering for $25,000 at a price of $0.01 per share. From December, 1997
through March, 1998, the Company sold an additional 387,000 shares of its
common stock in another offering for $96,750 at a price of $0.19 per share.
The stock offering costs related to these two offerings amounted to $53,286
and were charged to paid-in capital.
In November 1998, the Company issued 600,000 shares of its common stock for
services rendered valued at $28,080, or $0.05 per share. These shares were
subsequently canceled by the Company in December 1998.
10
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 7 - COMMON STOCK (Continued)
In March 1999, the Company sold 1,585,000 shares of its common stock in an
offering for $396,250 at a price of $0.25 per share. In March 1999, the
Company sold an additional 42,000 shares of its common stock in another
offering for $17,000 at prices ranging from $0.30 to $0.50 per share. The
stock offering costs related to these two offerings amounted to $101,166
and were charged to paid-in capital.
In May 1999, the Company issued 400,000 shares of its common stock for
services rendered valued at $100,000, or $0.25 per share.
In 1999, the Company issued options to a member of management to purchase
1,000,000 shares of its common stock at $0.01 per share. At the time the
options were issued, the Company's common stock was trading at $0.25 per
share. Accordingly, the Company recognized compensation expense of
$240,000, which was charged to paid-in capital (Note 9).
In July 1999, the Company issued 300,000 shares of its common stock for
services rendered valued at $150,000, or $0.50 per share.
NOTE 8 - GOING CONCERN
The Company's consolidated financial statements are prepared using
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. The Company has incurred losses which
have resulted in an accumulated deficit of approximately $601,000 at August
31, 1999 which raises substantial doubt about the Company's ability to
continue as a going concern. The accompanying consolidated financial
statements do not include any adjustments relating to the recoverability
and classification of asset carrying amounts or the amount and
classification of liabilities that might result from the outcome of this
uncertainty. Management believes that the Company will generate sufficient
advertising revenue and commissions through its licensing agreements and
hotel reservation internet website to cover all operating expenses in the
future, although no assurance of this can be given.
NOTE 9 - OUTSTANDING STOCK OPTIONS
The Company applies Accounting Principles board ("APB") Option 25,
"Accounting for Stock issued to Employees," and related interpretations in
accounting for all stock option plans. Under APB Option 25, compensation
cost is recognized for stock options granted to employees when the option
price is less than the market price of the underlying common stock on the
date of grant.
11
<PAGE> 13
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 9 - OUTSTANDING STOCK OPTIONS (Continued)
FASB Statement 123, "Accounting for Stock-Based Compensation" ("SFAS No.
123"), requires the Company to provide proforma information regarding net
income and net income per share as if compensation costs for the Company's
stock option plans and other stock awards had been determined in accordance
with the fair value based method prescribed in SFAS No. 123. The Company
estimates the fair value of each stock award at the grant date by using the
Black-Scholes option pricing model with the following weighted average
assumptions used for grants, respectively; dividend yield of zero percent
for all years; expected volatility of 32 percent for all years; risk-free
interest rates of 10.0 percent and expected lives of 4 years.
Under the accounting provisions of SFAS No. 123, the Company's net loss
would have been unchanged during the nine months ended August 31, 1999 and
the year ended November 30, 1998.
A summary of the status of the Company's stock option plans as of August
31, 1999 and November 30, 1998, and changes during the nine months ended
August 31, 1999 and the year ended November 30, 1998 are presented below:
August 31, 1999 November 30, 1999
Weighted Weighted
Average Average
Exercise Exercise
Shares Price Shares Price
Outstanding,
beginning of period - $ - - $ -
Granted 1,100,000 0.05 - -
Canceled - - - -
Exercised - - - -
--------- ------ ---- -----
Outstanding,
end of period 1,100,000 $ 0.05 - $ -
--------- ------ ---- -----
Exercisable,
end of period 1,000,000 $ 0.01 - $ -
--------- ------ ---- -----
Weighted average fair
value of options and
warrants granted
during the year $ 0.25 $ -
====== =====
12
<PAGE> 14
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Notes to the Consolidated Financial Statements
August 31, 1999
NOTE 9 - OUTSTANDING STOCK OPTIONS (Continued)
Outstanding Exercisable
Weighted
Average Weighted Weighted
Number Remaining Average Number Average
Outstanding Contractual Exercise Exercisable Exercise
Exercise Prices at 8/31/99 Life Price at 8/31/99 Price
$ 0.01 1,000,000 35 $ 0.01 1,000,000 $ 0.01
$ 0.25 100,000 45 0.25 - -
--------- ----- ------ --------- ------
$ 0.01 - $ 0.25 1,100,000 35.91 $ 0.05 1,000,000 $ 0.01
========= ===== ====== ========= ======
In 1999, the Company issued options to a member of management to purchase
1,000,000 shares of its common stock at $0.01 per share. At the time, the
Company's common stock was trading at $0.25 per share. Accordingly,
compensation expense of $240,000 has been recognized. The Company also
issued options to purchase 100,000 shares of its common stock at $0.50 per
share, which exceeded the trading price of the shares at the date of
issuance.
13
<PAGE> 15
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
Operations During the Fiscal Years November 30, 1998 and November 30, 1997
The Company's operations remained consistent during the last two
fiscal years. Net sales of advertising increased by approximately $100,000
while costs of goods sold increased by $9,000. The foregoing increase was
as a direct result of the Lease Agreement with Greyhound Lines, Inc. Sales
increased from $331,953 for fiscal 1997 to $438,272 for fiscal 1998. The
Company suffered a net loss of $55,002 for fiscal 1998 as compared with a
net loss of $8,782 for fiscal 1997. The loss was directly related to an
increase in administration expenses. General and administrative expenses
increased by approximately $160,000 from $151,483 for the fiscal year
ending November 30, 1997 to $311,283 for the fiscal year ending November
30, 1998. The increase in the general and administrative expenses was a
direct result of retaining additional employees in an attempt to generate
additional sales of advertising space and developing the Internet Web
site.
Operations During the Interim Periods of August 31, 1999 and August 31,
1998
In the first quarter of fiscal year 1999, the Company completed three
offerings of securities pursuant to Reg. 504 of the Securities Act of 1933
which increased its total cash by approximately $400,000. In December
1997, the Company sold 2,500,000 shares of its common stock at an offering
price of $0.01 per share. A total of $25,000 was raised from the offering.
In December 1997, the Company sold 400,000 shares of common stock at an
offering price of $0.25 per share. A total of $400,000 was raised from the
offering. From December 1997 through March 1998, the Company sold 387,000
shares of its common stock at an offering price of $0.25 per share. A
total of $96,750 was raised from the offering. During the first nine
months of fiscal November 30, 1999 which ended on August 31, 1999, the
Company had net sales of $326,446 as compared with $451,084 the same time
in 1998. As a result of the increase in administrative expenses, the
Company had a net loss of $59,914 for the period ending August 31, 1999 as
compared with a net profit for the period ending August 31, 1998.
In the event that the Company does not substantial increase its net
sales during the next three months, the Company anticipates reducing its
employee work force.
The Company had inadequate cash to maintain operations during the next
twelve months. The estimated amount of $2,500,000 is required to fund the
Company's plan of operations for the next twelve months. The Company's
current cash will satisfy its operation requirements for a period of five
months. As a result, its auditors, Jones, Jensen and Company have issued a
going concern opinion. In order to meet its cash requirements the Company
will have to raise additional capital through the sale of securities or
loans. As of the date hereof, the Company has not made sales of additional
securities and there is no assurance that it will be able to raise
additional capital through the sale of securities in the future. Further,
the Company has not initiated any negotiations for loans to the Company and
there is no assurance that the Company will be able to raise additional
capital in the future through loans. In the event that the Company is
unable to raise additional capital, it may have to reduce its operations.
The Company does not intend to conduct any research or development of
its services during the next twelve months other than as described herein.
<PAGE> 16
The Company does not intend to purchase a plant or significant
equipment.
Interim Periods Ended August 31, 1999 and 1998
Boards
Revenues generated from the leasing of space on the board for the nine
months ended August 31, 1999 totaled $441,937 as compared with $326,446 for
the nine months ending August 31, 1998. This was as a result of increased
revenues generated from the Greyhound contract.
Operating expenses relating to the leasing of space on the boards was
approximately $237,000 for the nine months ended August 31, 1999, as
compared with approximately $104,000 for nine months ended August 31, 1998.
This was as a result of hiring additional marketing personnel.
Other expenses relating to the leasing of space on the boards was
approximately $7,000 for the nine months ended August 31, 1999 as compared
with approximately $6,000 for the nine months ended August 31, 1998. This
was as a result of the depreciation of assets.
Web-site
Revenues generated from the web-site for the nine months ended August
31, 1999 was approximately $9,000 compared to $-0- for the nine months
ended August 31, 1998. The web-site began to generate revenues in the
third quarter of 1999.
Operating expenses relating to the web-site was approximately $28,000
for the nine months ending August 31, 1999 as compared with $-0- for the
nine months ending August 31, 1998. This was as a result of the
development of the web-site.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Registrant is not a party to any legal proceedings.
ITEM 2. RECENT SALES OF UNREGISTERED SECURITIES
During the period ending August 31, 1999, the Registrant did not issue
any unregistered securities.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There have been no defaults upon securities.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the quarter ended August 31, 1999, no matters were submitted to
the Registrant's security holders.
ITEM 5. OTHER INFORMATION
None.
<PAGE> 17
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
27* Financial Data Schedule
* Previously filed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Dated this 9th day of May, 2000.
budgethotels.com, inc.
(the "Registrant")
BY: /s/ William J. Marshall
William J. Marshall, President, Chief Executive Officer,
Treasurer, Chief Financial Officer and a member of the Board
of Directors.
