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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the period ended September 30, 2000
Commission file number 000-27347
BENTLEY COMMUNICATIONS CORP.
(Name of Small Business Issuer in Its Charter)
Florida 58-2534003
(State of Incorporation) (IRS Employer Identification No.)
9800 South Sepulveda Blvd. Suite 625 Los Angeles, CA 90045
(Address of Principal Executive Offices)
(310) 342-0760
Issuer's Telephone Number
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 [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 17,420,836 shares of Common Stock
($.001 par value) as of November 8, 2000.
Transitional small business disclosure format: Yes [ ] No [x]
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BENTLEY COMMUNICATIONS CORP.
Quarterly Report on Form 10-QSB for the
Quarterly Period Ending September 30, 2000
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Statements of Losses:
Three Months Ended September 30, 2000 and 1999
Consolidated Balance Sheets:
September 30, 2000 and June 30, 2000
Consolidated Statements of Cash Flows:
Three Months Ended September 30, 2000 and 1999
Notes to Consolidated Financial Statements:
September 30, 2000
Item 2. Plan of Operation
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
BENTLEY COMMUNICATIONS, CORP
CONSOLIDATED STATEMENTS OF LOSSES
UNAUDITED
Three months ended Sept 30,
2000 1999
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Revenues:
Web Hosting & Consulting Fees $ 12,875 $ 3,537
Operating expenses:
Selling, general and administrative
380,830 409,487
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Operating expenses
380,830 409,487
Net loss before taxes
(367,955) (405,950)
Provision for income taxes - -
Net loss $ (367,955) $ (405,950)
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Loss per common share
(0.02) (0.07)
(basic and assuming dilution)
Weighted average shares outstanding
Basic 17,215,891 6,172,500
Diluted 17,215,891 6,172,500
The accompanying notes are an integral part of these financial statements
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<TABLE>
BENTLEY COMMUNICATIONS, CORP.
CONSOLIDATED BALANCE SHEETS
<CAPTION>
ASSETS
September 30, 2000 June 30, 2000
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(Unaudited)
<S> <C> <C>
Current assets:
Cash and equivalents $ - $ 822
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Total current assets - 822
Property & Equipment - at cost
Furniture, Equipment, & Leasehold Improvements 158,845 158,845
Less: Accumulated Depreciation 19,551 8,972
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139,294 149,873
Other Assets
Deposits 8,000 8,000
Investments, at cost 152,000 80,000
Advances to Related Parties 38,379 38,379
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Total Other Assets 198,379 126,379
Total Assets $ 337,673 $ 277,074
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Cash disbursed in excess of available balances 6,578
Accounts payable and accrued expenses 300,465 122,139
Due to Shareholders 81,450 14,800
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388,493 136,939
Stockholders' equity:
Preferred stock, par value $.001 per share; 20,000,000
shares authorized; none issued at September 30, 2000 and
June 30, 2000 - -
Common stock, par value $.001 per share; 80,000,000
shares authorized; 17,270,836 issued at September 30,
2000 and 16,770,836 issued at June 30, 2000 17,271 16,771
Additional paid-in-capital 3,832,229 3,655,729
Retained earnings (3,900,320) (3,532,365)
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(50,820) 140,135
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$ 337,673 $ 277,074
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The accompanying notes are an integral part of these financial statements
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<TABLE>
BENTLEY COMMUNICATIONS, CORP
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
<CAPTION>
Three Months ended Sept 30
2000 1999
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<S> <C> <C>
Cash flows from operating activities:
Net income from operating activities $(367,955) $(405,950)
Adjustments to reconcile net income to net cash:
Common stock issued in exchange for investment 72,000
Common stock issued in exchange for services 105,000
Depreciation 10,579 25
Change in: Receivables
Prepaid expenses and other assets (72,000) (2,035)
Accounts payable and accrued expenses 244,976 404,084
Cash disbursed in excess of available balances 6,578 -
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Net cash used in operating activities (822) (3,876)
Cash flows used in investing activities:
Net cash used in investing activities - -
Cash flows provided by financing activities:
Net cash provided by financing activities - -
Net decrease in cash and cash equivalents (822) (3,876)
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Cash and cash equivalents at beginning of period 822 3,533
Cash and cash equivalents at end of period $ - $ (343)
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Supplemental Information:
Common Stock Issued for Services 105,000
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The accompanying notes are an integral part of these financial statements
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BENTLEY COMMUNICATIONS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(UNAUDITED)
NOTE A - SUMMARY OF ACCOUNTING POLICIES
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General
The accompanying unaudited consolidated financial statements have been prepared
in accordance with the instructions to Form 10-QSB, and therefore, do not
include all the information necessary for a fair presentation of financial
position, results of operations and cash flows in conformity with generally
accepted accounting principles.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three-month period ended September 30, 2000 are not
necessarily indicative of the results that may be expected for the year ended
June 30, 2001. The unaudited condensed consolidated financial statements should
be read in conjunction with the consolidated June 30, 2000 financial statements
and footnotes thereto included in the Company's SEC Form 10KSB.
Basis of Presentation
The consolidated financial statements include the accounts of the Company, and
its wholly owned subsidiary, Kyrenia Acquisition Corporation. Significant
intercompany transactions have been eliminated in consolidation.
Item 2. Management's Plan of Operation
The following discussion should be read in conjunction with the Company's
Consolidated Financial Statements and Notes thereto, included elsewhere within
this Report.
Description of Company
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The Company is transitioning from a development stage company, which, from its
inception has incurred significant organizational and development costs, to that
of an active growth and acquisition stage company. The Company seeks to engage
in the business of creating an international business to business (B2B) and
wholesale sourcing network. The Company's immediate focus is on E-commerce based
retail and wholesale sales and distribution for consumer and industrial
product-oriented non-U.S. based companies, initially in Asia and the Pacific
Rim.
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Forward Looking Statements
--------------------------
This Form 10-QSB contains certain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. All statements included
herein that address activities, events or developments that the Company expects,
believes, estimates, plans, intends, projects or anticipates will or may occur
in the future, are forward-looking statements. Actual events may differ
materially from those anticipated in the forward-looking statements. Important
risks that may cause such a difference include: general domestic and
international economic business conditions, increased competition in the
Company's markets and products. Other factors may include, availability and
terms of capital, and/or increases in operating and supply costs. Market
acceptance of existing and new products, rapid technological changes,
availability of qualified personnel also could be factors. Changes in the
Corporation's business strategies and development plans and changes in
government regulation could adversely affect the Company. Although the Company
believes that the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could be inaccurate.
There can be no assurance that the forward-looking statements included in this
filing will prove to be accurate. In light of the significant uncertainties
inherent in the forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the Corporation
that the objectives and expectations of the Company would be achieved.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
The following Management Discussion and Analysis should be read in
conjunction with the financial statements and accompanying notes included in
this Form 10-QSB.
GENERAL
The Company engages in the business of creating an international
business to business (B2B) and wholesale sourcing network. The Company's
immediate focus is on E-commerce based retail and wholesale sales and
distribution for consumer and industrial product oriented non-US based
companies, initially in Asia and the Pacific Rim.
REVENUE
For the three months ended September 30, 2000, revenues from continuing
operations, which are comprised exclusively of web hosting and consulting fees
were $12,875 as compared to $ 3,537 revenues during the three months ended
September 30, 1999. The Company has transitioned from a development stage
enterprise prior years to operating enterprise during the year ended June 30,
2000 and had nominal revenues in 1999.The Company reported a net loss from
operations before income taxes of $367,955 for the three months ended September
30, 2000 compared to a net loss of $405,950 in 1999.
COSTS AND EXPENSES
The Company's expenses from operations for the three months ended September 30,
2000 decreased $28,657 to $380,830 from $409,487 during the same period in 1999.
The decrease is due to the Company incurring additional costs in prior periods
in connection with the start up of its business. In addition, the Company
incurred costs of $105,000 associated with the value of common stock issued to
employees and consultants for services rendered during the period ended
September 30, 2000.
As the Company transitions from a development stage to an operating company, the
Company has incurred significant operating deficits which have decreased the
Company's working capital. Company management believes this trend will have a
material impact on the Company's short-term and long-term liquidity. Management
expects to fund this decrease in liquidity through the proceeds of loans from
significant shareholders and the private placement of its stock. Management
believes income from continuing operations may be materially impacted by the
transition from a development stage to an operating company.
Depreciation and amortization expense for the thre months ended September 30,
2000 was $10,579, an increase of $10,554 from $25 in 1999. The increase in
depreciation expense is as a result of the acquisition of office and related
equipment during the year ended June 30, 2000.
LIQUIDITY AND CAPITAL RESOURCES
As of September 30, 2000, the Company had a working capital deficit of $388,493
compared to a deficit of $136,117 at June 30, 2000, an increase in the deficit
of $252,376. The decrease in working capital was substantially due to the
increase in accounts payable and accrued expenses of $244,976 at September 30,
2000 as compared to June 30, 2000.
While the Company has raised capital and borrowed funds to meet its current and
projected working capital needs, additional financing will be required in order
to meet its obligations. The Company is seeking financing in the form of equity
and debt for working capital. There are no assurances the Company will be
successful in raising the funds required.
The Company has borrowed funds from significant shareholders of the Company in
the past to satisfy certain obligations and anticipates continuing to borrow
funds to meet future working capital requirements.
The Company generated a cash flow deficit from operations of $822 for the three
months ended September 30, 2000. Cash flow deficits from operating activities
for the period ended September 30, 2000 is primarily attributable to the
Company's net loss from operations of $367,955, adjusted for depreciation and
amortization of $10,579, and common stock issued for services of $105,000.
There were no cash flows from investing or financing activities for the three
months ended September 30, 2000.
The effect of inflation on the Company's revenue and operating results was not
significant. The Company's operations are in the southeastern United States and
there are no seasonal aspects that would have a material effect on the Company's
financial condition or results of operations
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2 Changes in Securities
On or about July 3, 2000 the Company issued 100,000 Units for $0.30 each for an
aggregate purchase price of $30,000. Each Unit consists of one common share and
one purchase warrant to purchase an additional common share for $0.75 until June
27, 2001.
On or about July 5, 2000 the Company issued 300,000 Units for $0.25 each for an
aggregate purchase price of $75,000. Each Unit consists of one common share and
one purchase warrant to purchase an additional common share for $0.75 until July
5, 2001.
On or about August 1, 2000, the Company issued 100,000 common shares, at $0.72
per share, for the acquisition of BuyNetPlaza pursuant to Section 4(2) of the
Securities Act of 1933, as amended.
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
3.1 (a) Articles of Incorporation of the Registrant
3.2 (a) By-laws of the Registrant
10.1 Agreement dated July 14, 2000, between Bentley Communications Corp. and
Nutek Inc. regarding the purchase of BuyNetPlaza
10.2 Agreement in Principal dated August 4, 2000, between Bentley
Communications Corp. and GenWorld Company Ltd. of Taiwan.
10.3 Agreement dated August 24, 2000, between Bentley Communications Corp.
and Athletic Role Model Educational Institute.
10.4 Letter of Intent dated September 7, 2000, between Bentley
Communications Corp. and Gen Ni Trading Co., Limited.
10.5 Letter of Intent dated September 14, 2000, between Bentley
Communications Corp. and Flynn Robinson.
10.6 Letter of Intend dated September 15, 2000, between Bentley
Communications Corp. and Spencer Haywood.
10.7 Agreement in Principal dated September 28, 2000, between Bentley
Communications Corp. and Dragon Apparel International Co.
27.1 Financial Data Schedule for the three months ended September 30, 2000
(electronic filing only)
99.1 June 8, 2000 Press Release: Los Angeles Firm to Play Significant Role
in China Trade
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99.2 August 9, 2000 Press Release: Bentley's E-Commerce Portfolio Expands
99.3 August 25, 2000 Press Release: Bentley Inks Global Licensing Agreement
with Major Hong Kong Toy Manufacturer in Dramatic B2B Expansion
99.4 August 30, 2000 Press Release: Bentley Communications Corp. Inks
Celebrity Pro-Athletes Web Site Deal
99.5 September 7, 2000 Press Release: Bentley Extends B2B Mission, Acquires
Genworld Group.
99.6 September 11, 2000 Press Release: NBA All-Star, L.A. Laker, The
Irrepressible Flynn Robinson Joins Bentley's Celebrity-Pro.com
E-Commerce Venture
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(a) Previously filed as an exhibit to the Company's Form 10-QSB
dated June 1, 2000
b) Reports on Form 8-K filed during the three months ended March 31, 2000.
During the three month period ended September 30, 2000, there have been
no current reports on Form 8-K filed by the Company.
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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.
Bentley Communications Corp.
Registrant
November 9, 2000 By: /s/ Gordon F. Lee
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Date Gordon F. Lee
President and
Chief Executive Officer