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
For the quarter ended September 30, 2000 Commission file number 000-28789
WOM, INC.
------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
New York 14-1818862
------------------------------------------------------------------------------
(State or other jurisdiction of (Internal Revenue Service
incorporation or organization) Employer Identification No.)
1151 Flatbush Road, Kingston, New York 12401
------------------------------------------------------------------------------
(Address of principal executive office) (Zip Code)
Issuer's Telephone Number, including area code: (845) 336-7700
N/A
-----------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act 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.
Yes __X__ No____
Common stock outstanding as of September 30, 2000 135,886
Transitional Small Business Disclosure Format Yes_____ No ___X_
1
<PAGE>
Part 1 - Financial Information
Item 1. FINANCIAL STATEMENTS
WOM, INC.
BALANCE SHEET
<TABLE>
<CAPTION>
<S>
<C> <C>
September 30, 2000 March 31, 2000
------------------ --------------
(Unaudited)
ASSETS
Cash $ 54 $ 54
====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Accrued expenses 4,080 100
------ -----
Total Liabilities 4,080 100
Shareholders' Equity:
Common stock, $.01 par value, 250,000 shares authorized;
issued 135,886 at September 30, 2000 and 100 at
March 31, 2000 1,359 1
Additional paid in capital - 99
Accumulated deficit (5,385) (146)
------ ---
Total Shareholders' Equity (Deficit) (4,026) (46)
------ ---
Total Liabilities and Shareholders' Equity 54 54
====== ====
See accompanying notes to unaudited financial statements.
</TABLE>
2
<PAGE>
WOM, INC.
STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
<S>
<C> <C>
Three months ended Six months ended
September 30, 2000 September 30, 2000
Costs and Expenses: ------------------ -------------------
Selling, general and
administrative expenses $ 0.00 $ 3,940
======== ========
Total Costs and Expenses 0 3,940
-------- --------
Loss Before Income Taxes 0 (3,940)
Provision for Income Taxes 0 (40)
-------- --------
Net Loss $ 0 $ (3,980)
======== ========
Basic Loss per Share $ 0.00 $ (0.03)
======== ========
Basic Weighted Average Number of Shares Outstanding 135,886 135,886
======== ========
See accompanying notes to unaudited financial statements.
</TABLE>
3
<PAGE>
WOM, INC.
STATEMENT OF CASH FLOWS
(Unaudited)
Six months ended
September 30, 2000
Operating Activities:
Net loss $ (3,980)
Adjustments:
Increase in accrued expenses 3,980
Net Cash Used
By Operating Activities -
Increase in Cash -
Cash Beginning 54
Cash Ending $ 54
Supplemental Cash Flow Information:
Interest paid $ -
Income taxes paid 0
See accompanying notes to unaudited financial statements.
4
<PAGE>
WOM, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
A. The accompanying unaudited financial statements have been prepared in
accordance with the generally accepted accounting principals for interim
financial information and with the instructions to Form 10-QSB. Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, the accompanying financial statements contain all adjustments
(consisting only of normal recurring adjustments) necessary to present fairly
the financial position of WOM, Inc. (the "Company") as of September 30, 2000,
and March 31, 2000; the results of operations for the three- and six-month
periods ended September 30, 2000; and the statement of cash flows for the
corresponding six-month period.
B. Business
WOM, Inc. ("WOM") was incorporated in December 1999 by Besicorp Ltd.
("Besicorp"), by the contribution of $100 in exchange for 100 shares of WOM
common stock in order to effectuate a spin-off prior to the merger of Besicorp
Ltd. WOM was established in order to permit the named plaintiff in the Bansbach
Litigation to remain eligible to maintain the Bansbach Litigation (See Note 2 of
the Notes to Financial Statements filed with the Company's annual report on Form
10-KSB for the year ended March 31, 2000). Capitalized terms used without being
defined herein shall have the meanings ascribed to such terms by WOM's Annual
Report on Form 10-KSB for the year ended March 31, 2000 filed with the
Securities and Exchange Commission on or about June 29, 2000.
C. Common Stock
Prior to the completion of the Besicorp Ltd. merger, WOM issued to Besicorp Ltd.
in addition to the 100 shares of WOM Common Stock held by Besicorp Ltd., 135,786
shares of WOM Common Stock, which Besicorp Ltd. distributed on a one share for
one share basis to the shareholders of Besicorp Ltd. based on the 135,886 shares
of Besicorp Ltd. common stock outstanding on April 25, 2000, the date of the
Merger.
D. Legal Proceedings
See Note 2 of the Notes to Financial Statements filed with the Company's annual
report on Form 10-KSB for the year ended March 31, 2000.
Item 2. Management's Discussion and Analysis of Plan of Operations
----------------------------------------------------------
The discussion below includes or may include certain forward-looking statements
that involve risks and uncertainties that concern WOM's financial position,
projected costs, and plans and objectives of management for future operations,
as well as other statements, including such words as "anticipate," "believe,"
"plan," "estimate," "expect," "intend," and other similar expressions. Although
we believe our expectations reflected in such forward-looking statements are
based on reasonable assumptions, you are cautioned that we cannot assure you
that such expectations will prove correct and that actual results and
developments may differ materially from those conveyed in such forward-looking
statements. Important factors that could cause actual results to differ
materially from the expectations reflected in the forward-looking statements
herein include:
- Costs or difficulties related to our establishment as an independent
entity (including our ability to fund our operations from the Escrow
Fund);
- The time it takes to resolve the Bansbach Litigation; and
- The outcome of the Bansbach Litigation.
These forward-looking statements speak only as of the date on which they are
made and we are not undertaking any obligation to update any forward-looking
statement to reflect events or circumstances after the date of this report. If
we do update or correct one or more forward-looking statement, you should not
conclude that we will make additional updates or corrections with respect
thereto or with respect to other forward-looking statements.
5
<PAGE>
As indicated previously (see Note B of Notes to the Financial Statements), we
are not engaged in any business activities nor do we intend to engage in any
such activities and, accordingly, we do not expect to have any future revenues
or profits. Our expenses generally will be limited to the expenses incurred in
preparing documents required to be filed by public companies, the expense of
distributing materials to shareholders and the transfer agent's fees, as well as
the costs associated with defending the Bansbach Litigation. These expenses will
generally be paid directly from the Escrow Fund and will not be reflected on our
financial statements. We have no full-time employees and no offices; Besicorp
agreed in the Contribution Agreement to provide us with the services of its
employees and to allow us to use its offices free of charge to the extent that
we determine they are reasonably necessary and for so long as we shall seek such
services and the use of such offices.
WOM's principal assets consist of its interests in the Bansbach Litigation.
These contingent assets comprise Old Besicorp's interests in the Bansbach
Litigation that Besicorp received from Old Besicorp as a result of the Prior
Merger Order. We believe that these contingent assets generally consist of any
recovery to which Old Besicorp would be entitled as a result of the resolution
of the Bansbach Litigation. (However, we are under no obligation to prosecute
the action or to assist the plaintiff, financially or otherwise, in his
prosecution of the Bansbach Litigation and we have no intention of providing any
assistant to the plaintiff.) Because we are not engaged in any business
activity, these assets are our only possible source of revenues. These assets
will not generate any revenues to WOM unless there is a settlement or final
judgment in favor of the plaintiff in the Bansbach Litigation.
We have also assumed the contingent liabilities comprising Old Besicorp's
interests in the Bansbach Litigation that Besicorp received from Old Besicorp as
a result of the Prior Merger Order. We believe that these contingent liabilities
generally consist of any damages for which Old Besicorp would be liable as a
result of the resolution of the Bansbach Litigation. Therefore, we intend to
defend ourselves from liability to the extent we deem appropriate.
Reimbursements for the costs of defending ourselves will be sought from the
Escrow Fund. In addition, if we are required to pay damages, we expect to seek
the money to pay such damages from the Escrow Fund unless the judgment
prohibited such reimbursement; if any of the other defendants in the Bansbach
Litigation, are required to pay damages we anticipate that we will indemnify
them and seek the money for such indemnification from the Escrow Fund unless
either (i) the judgment prohibited such indemnification or (ii) indemnification
is impermissible under the NYBCL. However, there can be no assurance that such
amounts will be available from the Escrow Fund or that WOM will be entitled to
receive any such monies from the Escrow Fund.
Liquidity and Capital Resources
As of September 30, 2000, we had cash of $54, which represented our initial
capitalization, less bank charges. We will not attempt to incur debt or raise
capital. However, the parties to the Escrow Agreement, which was executed in
connection with the Prior Plan of Merger, have agreed (i) to permit us to
receive up to $35,000 (the "Annual Expenses") annually in reimbursements from
the Escrow Fund to cover our reasonable expenses in connection with maintaining
our existence, complying with the Exchange Act and such other matters as may be
reasonably necessary to permit the Bansbach Litigation to continue and (ii) WOM
Litigation Costs (i.e. our costs and expenses relating to (a) the Bansbach
Litigation, (b) litigation arising out of or relating to the Bansbach
Litigation, (c) the Spin-Off and (d) our existence. Therefore, the Escrow Fund
is not a source of funds to the extent we need more than $35,000 in any year
(except for WOM Litigation Costs, which do not have a maximum amount).
We believe that the Escrow Fund will be available to satisfy any claims against
WOM resulting from the Bansbach Litigation, and, accordingly, we do not believe
that the assumption of the contingent liabilities will have any adverse effect
on our financial position or liquidity. While we are dependent upon our ability
to obtain money from the Escrow Fund to pay these expenses and without
reimbursements from the Escrow Fund, we will not be able to pay our obligations
as they become due and may be forced to curtail activities, we believe that
approximately $5.5 million in the Escrow Fund as of October 31, 2000 will be
sufficient to fund the Annual Expenses, indemnify BGI Parent, Old Besicorp and
other Purchaser Indemnities pursuant to the Indemnification Agreement and
reimburse Besicorp for its Litigation Costs.
6
<PAGE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K - none
<PAGE>
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.
Registrant
WOM, Inc.
Date: November 13, 2000 /s/ James E. Curtin
----------------- -------------------
James E. Curtin
Vice President and Controller
(principal accounting officer)
