U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
TO
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12 (g) OF THE SECURITIES EXCHANGE ACT OF 1934
COMBINED COMPANIES CORPORATION
------------------------------
(Name of Small Business Issuer in Its Charter)
DELAWARE 95-4737491
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
22147 PACIFIC COAST HIGHWAY, SUITE 4, MALIBU, CA 90265
-------------------------------------------------------------------
(Address of Principal Executive Offices) (ZipCode)
(310) 317-6939
Telephone Number
Securities to be registered under Section 12(b)
of the Exchange Act:
None
Securities to be registered under Section 12(g)
of the Exchange Act:
COMMON STOCK, $0.001 PAR VALUE
------------------------------
(Title of class)
<PAGE>
PART I
Page
Item 1. Description of Business............................................1
Item 2. Management's Discussion and Analysis or Plan of Operation..........5
Item 3. Description of Property............................................5
Item 4. Security Ownership of Certain Beneficial Owners and Management.....6
Item 5. Executive Officers, Promoters and Control Persons..................7
Item 6. Executive Compensation.............................................7
Item 7. Certain Relationships and Related Transactions.....................8
Item 8. Description of Securities..........................................8
PART II
Item 1. Market Price of and Dividends on the Registrants Common
Equity and Other Shareholder Matters........................9
Item 2. Legal Proceedings................................................. 9
Item 3. Changes in and Disagreements with Accountants......................9
Item 4. Recent Sales of Unregistered Securities............................9
Item 5. Indemnification of Directors and Officers..........................9
PART F/S
Financial Statements.........................................................11
PART III
Item 1. Index to Exhibits.................................................12
Item 2. Description of Exhibits...........................................12
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PART I
Item 1. Description of Business.
The Company
- -----------
Combined Companies Corporation ("Combined Companies" or the "Company") was
incorporated in Delaware April 27, 1998. It will be an online retailer focused
on baby products for expectant parents and their newborns. It will offer a vast
assortment of over 1200 carefully selected products and an easy-to-use online
shopping environment. It will provide expert buyer's guides, in-depth product
descriptions and personalized product recommendations, to help parents and gift
givers find quality products and make informed decisions about their babies
needs and safety.
The Company is creating and will maintain an online "store" for retailing
baby products, procuring and fulfilling the product orders and providing
customer service for the new and expecting parent community. The Company's
objective is to offer a full line of quality baby products and baby gifts, to
provide friendly, responsive customer service to an anticipated rapidly growing
customer base and to take advantage of the significant opportunity within this
market.
As part of the Company's strategy to offer a complete line of baby
products, it is looking to enter into an agreement with an established company
which would agree to merchandise the Company's anticipated website, procure and
provide inventory to be offered for sale and fulfill all of its future online
orders. This arrangement would provide an experienced inventory and fulfillment
partner with strong purchasing and merchandising skills and tremendous
experience in the baby products industry.
The Company intends to launch its website with a fresh logo, color scheme
and user interface. The Company believes that it will offer one of the easiest
and most user-friendly shopping experiences available in the online
baby-retailing category. It intends to implement a broad array of scalable
systems for website management, search, customer service, electronic transaction
management and data interchange, email, order processing, payment processing and
office administration services.
The Company intends to sign a number of exclusive retailing agreements with
manufacturers and/or distributors who make unique and desirable products for the
baby market.
Online Retailing of Baby Products
- ---------------------------------
The Internet is an increasingly significant global medium for
communication, content distribution and online commerce. Growth in Internet
usage has been fueled by a number of factors, including the large and growing
installed base of personal computers in the workplace and home, advances in the
performance and speed of personal computers and modems, improvements in network
infrastructure, easier and cheaper access to the Internet and increased
awareness of the Internet among businesses and consumers.
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The worldwide baby product industry is large, growing rapidly, and is
highly fragmented. The U.S. market for baby gear (apparel, infant care, nursery
and furniture, toys and food products) is estimated in excess of $18.0 billion
in annual sales. The baby gear market is large and stable with approximately
four million new babies born each year. Product margins in the baby gear market
are attractive - as new parents typically base purchase decisions on safety,
quality and recommendations. The average family spends over $7,000 in the first
year of a baby's life - and, with increasingly busy lifestyles and over half of
all new mothers working prior to delivery, online sales of baby products is
expected to continue to expand.
Manufacturers sell baby products both directly to retailers and through
a network of distributors and buying groups. There are many thousands of smaller
independent stores selling baby products in the U.S. that typically carry a
limited selection of products in a small selling space. These retailers have
recently come under intense competitive pressure from the larger stores.
Physical store-based baby product retailers must make significant
investments in inventory, real estate and personnel for each retail location.
This capital and real estate intensive business model, among other things,
limits the amount of inventory that can be economically carried in any location.
The Company believes that the baby product industry is particularly
suited to online retailing for the following reasons:
SHELF SPACE - An online store has virtually unlimited online "shelf space" and
can offer customers a vast selection of products through an efficient search and
retrieval interface. Combined Companies' website will be organized in a clear
and logical fashion that will allow browsers to quickly and easily find the
product line for which they are searching. This is particularly valuable in the
baby products market because the extraordinary number of choices precludes even
the largest physical store from economically stocking more than a small minority
of available products.
COMPLEX PRODUCTS - As a result of the complex nature and often-limited initial
knowledge of consumers with respect to baby products, sales personnel in
traditional baby stores often need to spend excessive amounts of time educating
the consumer. This results in the need to hire above-average numbers of sales
people to properly service any given store's customers effectively. In response
to this circumstance, the Company will develop and then continue to update its
"expert suggestion" and "how to" buying guides which will provide valuable
information for first-time buyers who need advice and guidance on which products
are the most appropriate for their needs. The use of the Internet will allow the
Company to provide significantly more information with greater accessibility
than traditional brick and mortar retailers including product reviews, editorial
comments and gift recommendations by product category and price.
LOCAL VS. GLOBAL REACH - By serving a large and global market through
centralized distribution and billing operations, online stores can realize
significant structural cost advantages as compared to traditional stores. The
Company believes that its future design will be an online store that provides
consumers with a convenient and enjoyable shopping experience in a Web-based
retail environment. Key elements of the shopping solution will include:
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SHOPPING CONVENIENCE - The Company's online store will be available 24
hours a day, 7 days a week from the convenience of the shopper's home or office.
EXTENSIVE PRODUCT SELECTION AND NOVEL MERCHANDISING - The site will offer a
complete array of baby products from both traditional brands and specialty
manufacturers.
HELPFUL SHOPPING SERVICES - To assist its shoppers, the website will offer
product reviews from experts and consumers, descriptions, pictures,
recommendations, gift suggestions and sophisticated browsing and search
technology.
INDUSTRY LEADING CUSTOMER SERVICE - The Company is committed to providing
the highest level of customer service available on the Internet. It will offer
pre- and post-sales support via telephone, email and fax.
Marketing/Branding Strategy
- ---------------------------
The Company recognizes the value of integrating the three C's of eTailing,
namely, community, content and commerce into one Website. As a result, the
Company intends to develop what it believes to be a unique strategy that
Management believes will effectively differentiate the Company from its
competition. Furthermore, it is believed that this strategy will enable the
Company to build and continue to grow the traffic to its future site while
increasing the "stickiness" of the site and thus providing the Company with
multiple opportunities to sell product to the established user base.
Due to the unique attributes of the pregnancy/baby market segment as it
relates to the Internet, the Company believes that providing content and
community itself is not a desirable business model. While the Company's primary
competitors have focused on providing community, content and commerce
themselves, Combined Companies will attempt to successfully form
marketing/commerce partnerships with a number of high profile
community/content-only pregnancy - related Web sites. The Company believes that
targeting the baby/pregnancy community/content sites and signing them to
exclusive advertising/content partnerships will be the most effective use of its
marketing resources. Furthermore, by partnering with these community/content
sites as opposed to offering its own content, the Company believes that it will
be seen as a value-added partner to many of the Internet's baby/pregnancy sites
as opposed to a direct competitor. The Company believes that this business model
will enable it to form additional partnerships in the future with content-only
sites that otherwise would not be willing to become affiliated with the Company.
Advertising
- -----------
The Company's marketing and promotion strategy will be designed to:
Build brand recognition;
Attract consumer traffic to its Web site;
Attract customers;
Build strong customer loyalty;
Maximize repeat purchases; and
Develop additional ways to increase its sales.
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Once the Company begins the launch of its website, a highly targeted
marketing program, currently in development, will be unveiled. This campaign
will include banner advertisements on certain targeted search engines, keyword
purchases of the words "baby", "baby products", "strollers", "cribs", "carseats"
and "baby gifts", email advertisements to the potential customers generated by
the sweepstakes databases, certain print advertisements and direct mail drops to
targeted geographic areas. Additionally, the Company will have a broad
representation on all of its community/content Partner's sites with banners,
buttons and other links to its site.
Customer Service
- ----------------
The Company intends to deliver superior customer service by focusing on
providing consumers with selection, convenience and content through a vast
assortment of products at competitive prices. It will deliver these key benefits
in a convenient shopping experience via a user-friendly website interface. In
contrast to the majority of e-commerce companies, Combined Companies has
consciously decided to create its customer service functions in-house instead of
outsourcing these services. The Company firmly believes that friendly and
responsive customer service is an avenue for building brand recognition and
customer loyalty within the baby space and that operating its own customer
service department is crucial in that endeavor.
The Company intends to allocate significant resources to the development
and expansion of the customer service function. It believes that, in general,
attentive, proactive customer service is an absolutely essential component of
any e-commerce business model and, in particular, the baby product space
requires superior customer service. Additionally, the Company's feels that,
almost without exception, browsers that will use customer service will become
its customers. Accordingly, as previously discussed, due to the perceived
importance of the customer service experience in the baby product buying
experience, it is the Company's intention to actively develop and then maintain
the operations of the Customer Service Department within the Company.
New Business Initiatives
- ------------------------
The Company is presently analyzing and identifying potential strategic
Internet partners that could be a source of established "captive" traffic and
customers. The Company intends to pursue a strategy of partnering with existing
content/community sites and hopes to consummate additional similar arrangements
in the near future. It is the Company's belief that, upon execution of a
strategic "partnership" as previously discussed, it will take approximately two
to three months to be fully integrated and incorporated with the "partner" site
and to begin reaping the benefits of the arrangement.
Canada
- ------
The Company believes that the Canadian marketplace for baby and baby
related merchandise is very similar to that of the United States. The Company
has recognized that the Canadian market does present a few specific challenges.
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Research indicates that the Canadian consumer is anxious and willing to
purchase merchandise over the Internet however, he/she desires to purchase
"Canadian". Due to currency adjustments and product safety standards and
certification, the Canadian consumer is desirous of purchasing from a Canadian
source. Accordingly, the Company has initiated a search for a Canadian
merchandising partner.
Spanish/Latin Market
- --------------------
The Company believes that the Spanish/Latin market in the US and South
America is a large and rapidly growing market segment that currently has limited
options in terms of pregnancy information and e-commerce offerings.
Spanish-speaking Internet users were forecast to reach more than 40 million in
Latin America, the United States and Spain by the end of 2000 according to an
International Data Corp. study. Internet users in Latin America alone were
expected to rise more than 50 percent in 1999 to 8.5 million.
The Company intends to launch a Spanish language version of its anticipated
website in order to gain the "first mover advantage" in this under-served yet
expanding e-commerce space.
Item 2. Management's Discussion and Analysis or Plan of Operation.
RESULTS OF OPERATIONS
The following discussion and analysis below should be read in conjunction
with the financial statements, including the notes thereto, appearing elsewhere
in this Registration Statement. For the period since inception (April 27, 1998)
through December 31, 1999, during the Company's development stage, the Company
has a zero cash balance and has generated a net loss of ($1,096).
FINANCIAL CONDITION AND LIQUIDITY
The Company has limited liquidity and has an ongoing need to finance its
activities. To date, the Company currently has funded these cash requirements by
offering and selling its Common Stock, and has issued 412,500 shares of Common
Stock for net proceeds of $1,001.00.
PLAN OF OPERATION
The Company has registered a dot.com name and has determined it can begin
conducting its business with limited financing that it has arranged.
Item 3. Description of Property.
The Company's executive and administrative offices are located at 22147
Pacific Coast Highway, Suite 4, Malibu, CA 90265. The Company pays no rent for
use of the office and does not believe that it will require any additional
office space in the foreseeable future in order to carry out its plan of
operations described herein.
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Item 4. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth as of December 31, 1999 certain information
relating to the ownership of the common stock.
Name and Address of Amount and Nature of Percent of
Beneficial Owner (1) Beneficial Ownership (2) Class (2)
- -------------------- ------------------------ ----------
Appletree Investment Company, Ltd 412,500(3) 100.00%
PageOne Business Productions, LLC 75,000 10.00%
George Todt 75,000(4) 10.00%
Besty Rowbottom 75,000(4) 10.00%
James Walters 75,000(4) 10.00%
All officers and directors as a group 75,000(4) 10.00%
(3 persons)
- ------------------------
(1) Unless otherwise indicated, the address of each beneficial owner is in the
care of Combined Companies Corporation, 22147 Pacific Coast Highway, Suite
4, Malibu, CA 90265.
(2) Unless otherwise indicated, Combined Companies believes that all persons
named in the table have sole voting and investment power with respect to
all shares of common stock beneficially owned by them. A person is deemed
to be the beneficial owner of securities which may be acquired by such
person within 60 days from the date of this registration statement upon the
exercise of options, warrants or convertible securities. Each beneficial
owner's percentage of ownership is determined by assuming all options,
warrants or convertible securities that are held by such person (but not
held by any other person) and which are exercisable or convertible within
60 days of this registration statement have been exercised or converted.
Percent of Class (third column above) assumes a base of 412,500 shares of
common stock outstanding as of December 31, 1999.
(3) Consists of 337,500 shares held of record by Appletree Investment Company,
Ltd., an Isle of Man corporation, and 75,000 shares held of record by
PageOne Business Productions, LLC, a Delaware limited liability company, of
which Appletree is a managing member.
(4) Consists solely of 75,000 shares of common stock held by PageOne Business
Productions, LLC, a Delaware limited liability company, of which Mr. George
Todt, Mr. Walters and Appletree Investment Company, Ltd. are managing
members and Ms. Rowbottom is Vice President.
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Item 5. Directors, Executive Officers, Promoters and Control persons.
The following table sets forth certain information with respect to the
directors and executive officers of Combined Companies Corporation.
Name Age(1) Position
- ---- --- --------
George Todt........................ 46 Director
Mary Elizabeth Rowbottom........... 28 President and Secretary
Jim Walters........................ 47 Treasurer
(1) The ages of Messrs. Todt and Walters and Ms. Rowbottom are listed as of
December 31, 1999.
Our director and executive officers devote such time and attention to the
affairs of Combined Companies as they believe reasonable and necessary. Set
forth below is a description of the background of our director and executive
officers.
George A. Todt was the President from inception until October 1999. He has
been the sole director since the inception of Combined Companies. Since 1996,
Mr. Todt has been a managing member of PageOne Business Productions, LLC, a
Delaware limited liability company. From 1990 to 1995, Mr. Todt was the chief
executive officer of REPCO, Inc., a worldwide designer and builder of
environmental facilities.
James Walters has been the Treasurer of Combined Companies since July 1999.
For more than 20 years, Mr. Walters has been engaged as a certified public
accountant with the Los Angeles, California-based firm of Kellogg & Andelson.
Mary Elizabeth Rowbottom became Secretary of Combined Companies in July
1999 and President in October 1999. She has been employed by PageOne since 1997
and has served as its Vice President since March 1999. From 1994 to 1997, Ms.
Rowbottom served as a talent agent at HSI Productions, a Chicago, Illinois-based
video production company.
Our board of directors currently consists of one member, who serves in such
capacity for a one-year term or until his successor has been elected and
qualified, subject to earlier resignation, removal or death. The number of
directors constituting the board of directors may be increased or decreased (but
not below the minimum number required by applicable law) from time to time by
resolution of the board of directors. Our officers serve at the discretion of
the board of directors, subject to any effective contractual arrangements.
Item 6. Executive Compensation.
Consistent with our present policy, no director or executive officer of
Combined Companies receives compensation for services rendered to the company.
However, these persons are entitled to be reimbursed for expenses incurred by
them in pursuit of our business objectives.
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Item 7. Certain Relationships and Related Transactions.
Not Applicable.
Item 8. Description of Securities.
Common Stock
- ------------
Combined Companies is authorized to issue 100,000,000 shares of common
stock, par value $0.001 per share. Holders of common stock are entitled to one
vote for each share held of record on all matters on which the holders of common
stock are entitled to vote. There are no redemption or sinking fund provisions
applicable to the common stock. The outstanding shares of common stock are, and
the common stock issuable pursuant to this prospectus will be, when issued,
fully paid and nonassessable.
Preferred Stock
- ---------------
Combined Companies is authorized to issue 8,000,000 shares of "blank check"
preferred stock, par value $0.001 per share, in one or more series from time to
time with such designations, rights and preferences as may be determined from
time to time by the Board of Directors, including, but not limited to (i) the
designation of such series; (ii) the dividend rate of such series, the
conditions and dates upon which such dividends shall be payable, the relation
which such dividends shall bear to the dividends payable on any other class or
classes or series of 1 Solution's capital stock and whether such dividends shall
be cumulative or non-cumulative; (iii) whether the shares of such series shall
be subject to redemption for cash, property or rights, including securities of
any other corporation, by Combined Companies or upon the happening of a
specified event and, if made subject to any such redemption, the times or
events, prices, rates, adjustments and other terms and conditions of such
redemptions; (iv) the terms and amount of any sinking fund provided for the
purchase or redemption of the shares of such series (v) whether or not the
shares of such series shall be convertible into, or exchangeable for, at the
option of either the holder or Combined Companies or upon the happening of a
specified event, shares of any other class or classes or of any other series of
the same class of Combined Companies's capital stock and, if provision be made
for the conversion or exchange, the times or events, prices, rates, adjustments
and other terms and conditions of such conversions or exchanges; (vi) the
restrictions, if any, on the issue or reissue of any additional preferred stock;
(vii) the rights of the holders of the shares of such series upon the voluntary
or involuntary liquidation, dissolution or winding up of Combined Companies; and
(viii) the provisions as to voting, optional and/or other special rights and
preferences, if any, including, without limitation, the right to elect one or
more directors. Accordingly, the Board of Directors is empowered, without
stockholder approval, to issue preferred stock with dividend, liquidation,
conversion, voting or other rights which adversely affect the voting power or
other rights of the holders of the common stock. In the event of issuance, the
preferred stock could be utilized, under certain circumstances, as a way of
discouraging, delaying or preventing an acquisition or change in control of
Combined Companies. Combined Companies does not currently intend to issue any
shares of its preferred stock.
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PART II
Item 1. Market Price of and Dividends on the Registrant's Common Equity and
Other Shareholder Matters.
There is currently no market for Combined Companies' securities. Combined
Companies has never paid cash dividends on its common stock. Payment of future
dividends will be within the discretion of Combined Companies's Board of
Directors and will depend on, among other factors, retained earnings, capital
requirements and the operating and financial condition of Combined Companies.
Item 2. Legal Proceedings.
Combined Companies is not currently a party to any pending legal
proceedings.
Item 3. Changes in and Disagreements with Accountants.
Not Applicable.
Item 4. Recent Sales of Unregistered Securities.
At the time of incorporation, Combined Companies issued 100 shares of
common stock to PageOne in exchange for consulting services valued at $1.00. In
March 1999, Combined Companies issued 900 shares of common stock to Appletree
and 100 shares of common stock to Page One. The purchase price for these shares
was $1.00 per share. The purchases were made pursuant to a Rule 504 Private
Placement Offering. There was no underwriter or placement agent involved in the
offer or sale of these securities and there was no public solicitation or
advertisement by Combined Companies in connection with the offer or sale of
these securities. The foregoing issuances of common stock were exempt from
registration under of the Securities Act of 1933, as amended, pursuant to
Section 4(2) thereof.
Item 5. Indemnification of Directors and Officers.
Combined Companies' Restated Certificate of Incorporation limits the
liability of its directors to Combined Companies or Combined Companies's
stockholders for monetary damages arising from a breach of fiduciary duty owned
to Combined Companies or Combined Companies's stockholders to the fullest extent
permitted by the Delaware General Corporation Law.
Combined Companies' Restated Certificate of Incorporation and its Bylaws
provide for the indemnification by Combined Companies of each person (including
the heirs, executors, administrators, or estate of such person) who is or was a
director or officer of Combined Companies to the fullest extent permitted or
authorized by law, including attorneys' fees. Section 145 of the Delaware
General Corporation Law provides in relevant part that a corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action by or in
the right of the corporation) by reason of the fact that such person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
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another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by such person in connection with
such action, suit or proceeding if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe such person's conduct was
unlawful.
In addition, Section 145 provides that a corporation may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or settlement
of such action or suit if such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Delaware Court
of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Delaware Court of Chancery or
such other court shall deem proper. Delaware law further provides that nothing
in the above-described provisions shall be deemed exclusive of any other rights
to indemnification or advancement of expenses to which any person may be
entitled under any bylaw, agreement, vote of stockholders or disinterested
directors or otherwise.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of Combined
Companies pursuant to the above statutory provisions or otherwise, Combined
Companies has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.
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PART F/S
The following financial statements of Combined Companies Corporation, a
development stage company, are contained on Pages F-1 through F-8:
REPORT OF INDEPENDENT AUDITORS, WEINBERG & COMPANY, P.A., CERTIFIED
PUBLIC ACCOUNTANTS, DATED APRIL 11, 2000.
BALANCE SHEET AS OF DECEMBER 31, 1999
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1999 AND
FOR THE PERIOD FROM APRIL 27, 1998 (INCEPTION) TO DECEMBER 31,
1999
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY FOR THE PERIOD
FROM APRIL 27, 1998 (INCEPTION) TO DECEMBER 31, 1999
STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 1999 AND
FOR THE PERIOD FROM APRIL 27, 1998 (INCEPTION) TO DECEMBER 31,
1999
NOTES TO FINANCIAL STATEMENTS AS OF DECEMBER 31, 1999
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WEINBERG & COMPANY, P.A.
6100 Glades Road, Suite 314
Boca Raton, FL 33434
(561) 487-5765
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of:
Combined Companies Corporation
We have audited the accompanying balance sheet of Combined Companies Corporation
(a development stage company) as of December 31, 1999 and the related statements
of operations, changes in stockholders' deficiency and cash flows for the year
then ended and for the period from April 27, 1998 (inception) to December 31,
1999. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly in all
material respects, the financial position of Combined Companies Corporation (a
development stage company) as of December 31, 1999, and the results of its
operations and its cash flows for the year then ended and for the period from
April 27, 1998 (inception) to December 31, 1999, in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 4 to the
financial statements, the Company is a development stage company without
operations and has accumulated operating losses of $1,096 since inception and a
working capital deficiency of $95. These factors raise substantial doubt about
its ability to continue as a going concern. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
WEINBERG & COMPANY, P.A.
Boca Raton, Florida
April 11, 2000
F-1
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COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 1999
ASSETS
TOTAL ASSETS $ -
- ------------
==========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Loan payable to principal stockholder $ 95
----------
STOCKHOLDERS' DEFICIENCY
Preferred stock, $0.001 par value, 8,000,000 shares
authorized, none issued and outstanding -
Common stock, $0.001 par value, 100,000,000 shares
authorized, 412,500 issued and outstanding 412
Additional paid-in capital 589
Accumulated deficit during development stage (1,096)
----------
TOTAL STOCKHOLDERS' DEFICIENCY (95)
----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ -
- ---------------------------------------------- ==========
See accompanying notes to financial statements
F-2
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COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
April 27, 1998
Year Ended (Inception) to
December 31, December 31,
1999 1999
------------- -------------
REVENUES - $ -
------------- -------------
EXPENSES
Accounting fees 500 500
Bank charges 95 95
Consulting fees - 1
Legal fees 500 500
------------- -------------
NET LOSS $ (1,095) $ (1,096)
============= ============
Net loss per share - basic and diluted $ (.003) $ (.005)
============= ============
Weighted average number of shares
outstanding during the period -
basic and diluted 312,842 201,181
============= ============
See accompanying notes to financial statements
F-3
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COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY
FOR THE PERIOD FROM APRIL 27, 1998 (INCEPTION) TO DECEMBER 31, 1999
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional During
--------------------- Paid-In Development
Shares Amount Capital Stage Total
--------- --------- ----------- ------------ --------
<S> <C> <C> <C> <C> <C>
Common stock issued for services 37,500 $ 37 $ ( 36) $ - $ 1
Net loss for the year ended December 31,
1998 - - - ( 1) ( 1)
--------- --------- ----------- ------------ --------
Balance, December 31, 1998 37,500 37 ( 36) ( 1) -
Common Stock issued for cash 375,000 375 625 - 1,000
Net Loss for the year ended December 31,
1999 - - - (1,095) (1,095)
--------- --------- ----------- ------------ --------
Balance at December 31, 1999 412,500 $ 412 $ 589 $ (1,096) $ ( 95)
- --------------------------- ========= ========= =========== ============= ========
</TABLE>
See accompanying notes to financial statements
F-4
<PAGE>
COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
April 27, 1998
Year Ended (Inception) to
December 31, December 31,
1999 1999
--------------- --------------
Cash flows from operating activities
Net loss $ (1,095) $ (1,096)
Adjustments to reconcile net loss to net
cash used in operating activities:
Common stock issued for services - 1
--------------- -----------
Net cash used in operating activities (1,095) (1,095)
--------------- -----------
Cash flows from financing activities
Proceeds from issuance of common stock 1,000 1,000
Loan proceeds from principal stockholder 95 95
--------------- -----------
Net cash provided by financing activities 1,095 1,095
--------------- -----------
NET INCREASE IN CASH - -
CASH AND CASH EQUIVALENTS -
BEGINNING - -
--------------- -----------
CASH AND CASH EQUIVALENTS -
ENDING $ - $ -
=============== ===========
See accompanying notes to financial statements
F-5
<PAGE>
COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1999
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ------- ------------------------------------------
(A) Organization and Description of Business
---------------------------------------------
Combined Companies Corporation (a development stage company) (the
"Company") was incorporated in the State of Delaware on April 27, 1998
to engage in an internet-based business. At December 31, 1999, the
Company had not yet commenced any revenue-generating operations, and
all activity to date relates to the Company's formation, proposed fund
raising and business plan development.
The Company's ability to commence revenue-generating operations is
contingent upon its ability to implement its business plan and raise
the additional capital it will require through the issuance of equity
securities, debt securities, bank borrowings or a combination thereof.
(B) Use of Estimates
--------------------
In preparing financial statements in conformity with generally
accepted accounting principles, management is required to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent assets and
liabilities at the date of the financial statements and revenues and
expenses during the reported period. Actual results could differ from
those estimates.
(C) Cash and Cash Equivalents
-----------------------------
For purposes of the cash flow statements, the Company considers all
highly liquid investments with original maturities of three months or
less at time of purchase to be cash equivalents.
(D) Income Taxes
----------------
The Company accounts for income taxes under the Financial Accounting
Standards Board Statement of Financial Accounting Standards No. 109.
"Accounting for Income Taxes" ("Statement No.109"). Under Statement
No. 109, deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and
liabilities and their respective tax basis. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are
expected to be recovered or settled. Under Statement 109, the effect
on deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment date.
There was no current income tax expense due to the Company's operating
losses. There were no current or deferred income tax expenses or
benefits due to the Company not having any material operations for the
period ended December 31, 1999.
F-6
<PAGE>
COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1999
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
- ------- ------------------------------------------
(E) Loss Per Share
Net loss per common share for the year ended December 31, 1999 and for
the period from April 27, 1998 (inception) to December 31, 1999 is
computed based upon the weighted average common shares outstanding as
defined by Financial Accounting Standards No. 128 "Earnings Per
Share". There were no common stock equivalents outstanding at December
31, 1999.
NOTE 2 LOAN PAYABLE TO PRINCIPAL STOCKHOLDER
- ------- -------------------------------------
The loan payable to principal stockholder is a non-interest-bearing
loan payable to PageOne Business Productions, LLC. The amount is due
and payable on demand.
NOTE 3 STOCKHOLDERS' DEFICIENCY
- ------- ------------------------
The Company was originally authorized to issue 2,000 shares of common
stock at $.01 value. The Company issued 900 and 200 shares to
AppleTree Investment Company, Ltd. and PageOne Business Productions,
LLC, respectively.
Management filed an amendment to the articles of incorporation with
the State of Delaware, which increased the number of authorized common
shares to 100,000,000, effected a 375 to 1 split of the 1,100
previously issued common shares and created 8,000,000 authorized
shares of preferred stock, of which the issuance, rights and other
terms are to be determined by the Company's Board of Directors. In
addition, the par value of the common stock was changed to $0.001 per
share and the par value of the new preferred stock was set at $0.001
per share.
The financial statements at December 31, 1999 give retroactive effect
to common stock split, new authorized share amounts, and par values
enumerated in the amended certificate of incorporation. No preferred
shares have been issued as of December 31, 1999.
F-7
<PAGE>
COMBINED COMPANIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1999
NOTE 4 GOING CONCERN
- ------- -------------
As reflected in the accompanying financial statements, the Company has
had accumulated losses of $1,096 since inception, a working capital
deficiency of $95 and has not generated any revenues since it has not
yet implemented its business plan. The ability of the Company to
continue as a going concern is dependent on the Company's ability to
raise additional capital and implement its business plan. The
financial statements do not include any adjustments that might be
necessary if the Company is unable to continue as a going concern.
The Company intends to implement its business plan and is seeking
funding through the private placement of its equity or debt securities
or may seek a combination with another company already engaged in its
proposed business. Management believes that actions presently being
taken provide the opportunity for the Company to continue as a going
concern.
F-8
<PAGE>
PART III
Item 1. Index to Exhibits
The following exhibits are filed with this Registration Statement:
Exhibit No. Exhibit Name
- ---------- ------------
3.1 Restated Certificate of Incorporation of the Registrant *
3.2 By-Laws of the Registrant *
27 Financial Data Schedule (incorporated herein by reference
to Registrant's Annual Report on Form 10-KSB for the year
ended December 31, 1999).
* previously filed
Item 2. Description of Exhibits
See Item 1 above.
12
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
Combined Companies Corporation
(Registrant)
Amendment No. 1 /s/ Mary Elizabeth Rowbottom
Date: April 27, 2000 By: -----------------------------
Mary Elizabeth Rowbottom
President
13
