UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d) of
The Securities Exchange Act of 1934
March 31, 2000 0-28431
- --------------------- ----------------------
For the Quarter Ended Commission File Number
MILLENIUM HOLDING GROUP, INC.
-------------------------------
(Name of Small Business Issuer)
Nevada 88-0109108
- ------------------------ -----------------------
(State of Incorporation) (I.R.S. Employer
Identification Number.)
3800 Old Cheney Road Suite 101-222, Lincoln, NE 68516
----------------------------------------------------------
(Address of Principal Executive Offices Including Zip Code)
(402) 434 5690
(Issuers 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 such shorter
period that the registrant was required to file such reports), and (2) has been
subject to filing requirements for the past 90 days. YES [X] NO [ ]
Number of shares outstanding of each of the issuer's classes of common equity,
as of March 31, 2000; 11,366,525
Transitional Small Business Disclosure Format: Yes [ ] No [X]
<PAGE>
MILLENIUM HOLDING GROUP, INC.
INDEX
PAGE
----
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Balance Sheet at March 31, 2000 3
Statement of Income for the three months
ended March 31, 2000 4
Statement of Changes in Stockholders Equity for
the three months ended March 31, 2000 5
Statement of Cash Flows for the three months
ended March 31, 2000 6
Notes to Financial Statements 7
Item 2 - Management's Discussion and Analysis 9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities and Use of Proceeds 11
Item 3. Default Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MILLENIUM HOLDING GROUP, INC.
BALANCE SHEET
FOR THE PERIOD ENDING
MARCH 31, 2000
(UNAUDITED)
ASSETS
ASSETS
Reinstatement costs (net of amortization of $947) $ 17,998
Proprietary insurance products 734,218
Overriding royalty interests, Rusk and Harrison
Counties, Texas 1
----------
TOTAL ASSETS $ 752,217
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable $ 1,740
Accrued wages 26,250
Accrued payroll taxes 2,771
Accounts payable - stockholder 32,384
----------
TOTAL LIABILITIES $ 63,145
==========
STOCKHOLDERS' EQUITY
Common stock, $.05 par value, 50,000,000 shares
authorized, 11,366,525 shares issued and outstanding $1,172,828
Paid-in capital 2,063,015
Retained earnings (deficit) (50,147)
Deficit accumulated during the development stage (2,496,624)
----------
Total stockholders' equity 689,072
----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 752,217
==========
See accompanying notes to financial statements.
3
<PAGE>
MILLENIUM HOLDING GROUP, INC.
STATEMENT OF INCOME
FOR THE QUARTER ENDED
MARCH 31, 2000
(UNAUDITED)
REVENUES $ 0
EXPENSES
Salaries and wages 22,500
Payroll tax expense 2,323
Amortization expense 947
Office expenses 3,097
Professional fees 15,083
--------
TOTAL EXPENSES 43,950
--------
NET INCOME (LOSS) $(43,950)
========
See accompanying notes to financial statement.
4
<PAGE>
MILLENIUM HOLDING GROUP, INC.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD ENDING
MARCH 31, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
Common Stock Retained Deficit from
------------------- Paid-in Earnings Development
Shares Amount Capital (Deficit) Stage Totals
------ ------ ------- --------- ----------- ------
<S> <C> <C> <C> <C> <C> <C>
BALANCES, December 31, 1999 704,869 $1,094,406 $1,402,219 $ (6,197) $(2,496,624) $ (6,196)
Stock for professional services 100,000 5,000 5,000
Acquisition of assets for stock 1,468,436 73,422 660,796 734,218
5 for 1 forward stock split 9,093,220
Net activity (43,950) (43,950)
---------- ---------- ---------- -------- ----------- ---------
BALANCES, March 31, 2000 11,366,525 $1,172,828 $2,063,015 $(50,147) $(2,496,624) $ 689,072
========== ========== ========== ======== =========== =========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
MILLENIUM HOLDING GROUP, INC.
STATEMENT OF CASH FLOWS
FOR THE QUARTER ENDED
MARCH 31, 2000
(UNAUDITED)
Net income (loss) $(43,950)
--------
Adjustments to reconcile net income to net cash
provided by operating activities
Amortization expense 947
(Increase) decrease in
Prepaid expenses 0
(Decrease) increase in
Accounts payable 1,740
Accrued wages 22,500
Accrued payroll taxes 2,324
Accounts payable - stockholder 11,439
--------
Total adjustments 38,950
--------
CASH FLOWS FROM OPERATING ACTIVITIES (5,000)
--------
CASH FLOWS FROM INVESTING ACTIVITIES 0
CASH FLOWS FROM FINANCING ACTIVITIES
Stock issued for professional services 5,000
--------
NET INCREASE (DECREASE) IN CASH 0
CASH, beginning of period 0
CASH, end of period $ 0
========
SUPPLEMENTAL DISCLOSURES
Noncash financing transactions
Acquisition of proprietary insurance products for
1,468,436 shares of stock $734,218
Acquisition of professional legal services for
100,000 shares of stock $ 5,000
See accompanying notes to financial statements.
6
<PAGE>
MILLENIUM HOLDING GROUP, INC.
NOTES TO FINANCIAL STATEMENTS
STATEMENT OF INFORMATION FURNISHED
The accompanying financial statements have been prepared in accordance with
Form 10-QSB instructions and in the opinion of management contain all
adjustments (consisting of only normal and recurring accruals) necessary to
present fairly the financial position as of March 31, 2000. These results have
been determined on the basis of generally accepted accounting principles and
have been reviewed by our independent auditor.
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
AMEX Systems Corporation, a Nevada corporation, was incorporated
December 22, 1969, for the purpose of merging other corporations
together to achieve savings from consolida-tions. The name of the
Corporation was formally changed to Millenium Holding Group, Inc. during
1999.
The company had been inactive and has not actively conducted operations,
generated revenues or incurred expenses since 1995. During 1999 the
company started up operations and is currently in full time operations.
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.
NOTE 2. MERGERS
In 1970, 1971 and 1994, the Company completed the mergers as follows:
1970 - Wasatch Mineral and Construction Corporation: This entity
attempted to conduct the business of mining and mineral exploration.
Corporate stock was issued in connec-tion with the purchase of
properties and these investments were valued at approximately $482,276,
but no significant revenues were earned. An accumulated deficit from
Wasatch Mineral and Construction for $365,820 was added to the Company's
stockholders' equity as a result of this merger and activity.
1971 - National Pumicite Development Corporation: This entity owned a
patent applica-tion for manufacturing dense heat insulating and
nonabsorbent concrete. Corporate stock was issued in connection with
this acquisition, which was valued at $210,364.
1994 - EnergeCo (A Limited Liability Company): This entity held oil and
gas leases in Southwestern Oklahoma. After undergoing a 20 to 1 reverse
stock split, the Company issued 21,435,043 shares of stock in connection
with this merger.
Additional business merger attempts were made in the years 1983 - 1988,
with no trans-actions completed. There were no merger documents signed
and no costs incurred in connection with these failed mergers, however,
the Company issued an additional 2,588,700 shares of stock in connection
with them.
NOTE 3. PRIOR ACTIVITIES
During the period from 1969 through 1974, general and administrative
costs totaling $237,817 were incurred, including $165,792 in consulting
fees. During the period from 1975 through 1982, additional expenses
totaling $740,711 were incurred in connection with the issuance of
additional shares of common stock. During this period the Company earned
no significant revenues. All expenses incurred during the period from
1969 through 1982 were charged to operations.
7
<PAGE>
MILLENIUM HOLDING GROUP, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 4. STATUS OF ACTIVITIES AND OPERATIONS
The Company had been inactive since 1995. In the opinion of Management,
there are no liabilities, judgments or pending legal actions arising
from prior activities of the Company, mergers or merger attempts. The
company started up operations again in 1999 and is currently in full
operations.
NOTE 5. OVERRIDING OIL AND LIGNITE ROYALTY INTERESTS, RUSK AND HARRISON
COUNTIES, TEXAS
The Company acquired these properties in 1986 for 850,000 shares of
stock. The original recorded financial statement value of the properties
was $1 and the Company has earned no income from these properties to
date.
NOTE 6. PROPRIETARY INSURANCE PRODUCTS
A stockholder and officer transferred proprietary insurance products
that had a cost of $734,218 in exchange for 1,468,436 shares of stock.
These products include prototypes to be used with actuarial sciences for
pricing, reinsurance, market research, development and contract forms.
It is anticipated that these products and services will be marketed to
the insurance industry to generate revenue for the Corporation.
NOTE 7. INCOME TAX RETURNS
The Company has not filed federal income tax returns for several years.
The failure to file income tax returns may subject the Company to fines
not exceeding $100 per year. As a result of the failure to file income
tax returns, the Company may have lost any tax benefits, which would
otherwise arise from prior year net operating losses.
NOTE 8. CONTINGENT LIABILITY
During a prior year, the Company entered into an agreement with John and
R. Blair Lund to make a market for the stock for the Company. Upon
completion of the agreement, these individuals were to be issued 25,000
shares of stock in AMEX Systems Corporation and $5,000 cash in exchange
for their services. In the opinion of the Company's management, the
agreement was not fully completed and there remains a dispute with the
Lunds for compensation earned for partial completion of the agreement.
This dispute originated in 1994 when EnergeCo was merged into the
Company.
NOTE 9. STATUS OF OTCBB LISTING
The Company was dropped from the Over-The-Counter Bulletin Board (OTCBB)
exchange listing effective August 30, 1999. The Company was reinstated
on December 29, 1999 to the OTCBB listing. The Company had incurred
expenses of $18,945 for this reinstatement and these costs will be
amortized over five years starting in 2000.
8
<PAGE>
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
MANAGEMENT'S PLAN OF OPERATION
Millenium Holding Group, Inc. (OTC BB:MNHG) is a publicly traded and
fully reporting financial services Company in early stage development. The
passage of the Financial Modernization Act (Gramm-Leach-Bliley Act) will
radically overhaul the nation's banking, insurance and securities markets. The
Act allows one Company to possess all three disciplines. The Company has entered
into a Letter of Intent to acquire the Stanford Life Insurance Company, which it
anticipates closing within sixty (60) days. The officers and directors of the
Company have years of experience in the insurance industry. The Company is also
actively pursuing the creation of an Internet National Bank and exploring the
possibility of forming or acquiring a Broker Dealer in order to service the
securities market.
In order to receive a charter to operate an Internet National Bank, the
Company will follow the requirements as set by the Office of the Comptroller of
the Currency (OCC). The organizers understand the national banking laws,
regulations and sound banking operations and practices. The Board of Directors
of the Company has years of experience in the financial management field and has
begun recruiting competent management with the ability and experience to
successfully operate a bank of this type in a safe and sound manner.
The principal shareholders, Richard Ham and Ham Consulting Company will
meet the satisfaction of the Company's cash requirements in the near future in.
The principal shareholders have no expectations of reimbursement of the funds
advanced other than the possibility of restricted stock payment in lieu of cash.
It has no way of determining whether there will be any type of reimbursement in
the future.
The cost associated with the acquisition and leasing of the software
developed by Banking Software Co. and the integration technology created by IBM
as well as the hiring of the numerous employees necessary to launch the Internet
Bank will indubitable precipitate either a public offering or the existing
shareholders will re-invest on a private basis. The Company will raise at least
five million dollars ($5,000,000), net of all fees and organizational costs.
9
<PAGE>
The software required for the Internet bank is in control of the
majority shareholder and will be leased to the Company by the principal
shareholder. It is state of the art and can service up to a fourteen
billion-dollar bank. The Systems will provide an automation Systems with
multi-currency and multi-lingual abilities. The core Systems is stable and
secure with an adaptable foundation that allows the Company to continue to focus
its resources and attention on delivering products and services to its
customers. The software, which can be adapted to the insurance business, will be
the center of the Company's business, consists of the following five components:
1. The Customer Information Component tracks data on all customers.
2. The Deposit Accounting component processes all deposit products,
ranging from checking, Money Market, savings, passbook and club
accounts to certificate of deposit, time deposit open accounts, OIDs
and IRAs.
3. The Loan Accounting component processes personal, credit line,
business and real estate loans.
4. The Transaction Processing component is the manager and dispatcher of
monetary transactions.
5. The Executive Information component houses the general ledger and is
the source of financial management information.
This very unique software will allow the Company to expand into the now
authorized banking field of insurance. The Company is now ready to embark on
said expansion and has the software in place to do so.
There is no other plan to develop new products within the next 12-month
period.
The Company is also intending to become a member of the Society for
Worldwide Interbank Financial Telecommunication (S.W.I.F.T.). It is the
Company's belief that membership in this organization will provide the bank
international access and credibility. The core banking Systems will be
interfaced with S.W.I.F.T. so that transactions will automatically be recorded
throughout the appropriate components of the automated Systems. This
organization provides low-cost competitive financial processing and
communication services of the highest quality, integrity and reliability.
The Company does not believe that it will encounter internal year 2000
problems in that the software is year 2000 compliant.
The Company will hire knowledgeable professionals for its customer
interface to offer personalized attention and service to the individual. It will
also hire a Chief Technology Officer and add other individuals who will bring
valuable experience to better service the Company's banking and insurance
customers.
10
<PAGE>
Mr. Ham has sold to the Company certain proprietary insurance products
for restricted shares of the Company's stock. This information is set forth in a
certain 8 K filed on February 18, 2000, which is incorporated by reference.
On February 14, 2000 the registrant entered into a Letter of Intent
with Stanford Life Insurance Company, an Arizona corporation, wherein the
registrant indicated its intent to purchase all of the issued and outstanding
common shares of the company for stock and cash. The proposed transaction
consists of a cash purchase for the Statutory Capital and Surplus of Stanford
and 125,000 shares of restricted (Rule 144) shares of the registrant. The
successful closing of the acquisition is dependent upon respective board
approvals, adequate financing, completion of required due diligence (including
the State of Arizona approval) and an acceptable definitive agreement. This
information is set forth in a certain 8 K filed on February 18, 2000, which is
incorporated by reference.
On February 25, 2000 The Board of Directors approved a 5 for 1 forward
stock split. The Record Date was March 13, 2000 and the Pay Date was March 20,
2000. This information is set forth in a certain 8 K filed on March 4, 2000,
which is incorporated by reference. It was also reported in this Form 8 K that
Mr. Ham now held 64.6% of the outstanding shares of the registrant.
On April 22, 2000 the company executed an agreement wherein it
purchased a certain insurance agency from Mr. Richard Ham the President of the
company as well as the beneficial owner of the majority of the registrant's
common shares of the company. The amount of consideration received by Mr. Ham
will be $20,379.00 payable with 20,379 Restricted (R144) shares of the Common
Stock of the registrant. The Agreement evidencing said transaction and the
applicable pro forma financials have been set forth in a Form 8 K filed on May
1, 2000 which is incorporated by reference.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not a party to any litigation and to its knowledge, no
action, suit or proceedings against it has been threatened by any person or
entity.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULT UPON SENIOR SECURITIES
None
11
<PAGE>
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 Articles of Incorporation with Amendments filed with the Form
10 SB on December 9, 1999 and incorporated by reference
3.2 By Laws filed with the Form 10 SB on December 9, 1999 and
incorporated by reference
3.3 Computation per share earnings, in current financial
statements and filed with Form 10 SB on December 9, 1999 and
incorporated by reference.
23 Consent of Accountant
27 Financial Data Schedule
(b) Reports on Form 8-K
There have been five reports filed on Form 8-K and all are
incorporated by reference.
1. February 18, 2000 disclosing acquisition of assets from the
President of the registrant
2. March 4, 2000 which disclosed a five for one stock split and a
letter of intent indicating the acquisition of Stanford Life
Insurance Company.
3. March 16, 2000 disclosing a change of CUSIP number by the
NASD.
4. The stock symbol was change and reported in an 8 K filed on
March 17, 2000.
5. The acquisition of an insurance agency from Mr. Ham the
majority shareholder reported on May 1, 2000.
12
<PAGE>
SIGNATURE
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.
MILLENIUM HOLDING GROUP, INC.
May 13, 2000 /s/ Richard L. Ham
----------------------------------------
Richard L. Ham, Director and President
13
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the use in the General Form for Registration of Securities of
Small Business Issuers on Form 10-SB of our report dated May 11, 2000 review of
the financial statements of Millenium Holding, Group, Inc. as of March 31, 2000
and for the quarter then ended.
/s/ Dana F. Cole & Company
Lincoln, Nebraska
May 12, 2000
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERNCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
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