<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
--------------
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE TRANSITION PERIOD FROM _________________ TO _______________
Commission file number 0-29 219
----------
POKER.COM INC
--------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
FLORIDA 98-0199508
------------------------------------ ---------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
SUITE 201 1166 ALBERNI ST. VANCOUVER V6E 3Z3
------------------------------------ ---------------------------------
(Address of principal executive offices) (Zip Code)
(604) 689-5998
--------------------------------------------------------------------------------
(Issuer's telephone number)
________________________________________________________________________________
(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 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 ___ No X
---
Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes ____ No _____
Applicable only to corporate issuers
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. 5,200,000 COMMON SHARES AS AT MARCH
31, 2000.
Transitional Small Business Disclosure Format
(Check one):
Yes ____ No X
---
<PAGE>
POKER.COM INC.
FORM 10-QSB
FOR THE QUARTER ENDED MARCH 31, 2000
<TABLE>
<CAPTION>
Index Page Number
<S> <C> <C>
PART I FINANCIAL INFORMATION
Item 1. Consolidated Balance Sheets 5
Consolidated Statements of Operations 6
Consolidated Statement of Stockholders' Equity 7
Consolidated Statements of Cash Flows 8
Notes to Unaudited Consolidated Financial Statements 9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults Upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURE 14
</TABLE>
2
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
POKER.COM, INC.
(A Development Stage Company)
Consolidated Financial Statements
March 31, 2000 (Unaudited) and
December 31, 1999 and 1998
(U.S. Dollars)
INDEX
-----
Report of Independent Chartered Accountants
Consolidated Financial Statements
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Stockholders' Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
3
<PAGE>
REPORT OF INDEPENDENT CHARTERED ACCOUNTANTS
TO THE DIRECTORS AND SHAREHOLDERS OF POKER.COM, INC.
(A Development Stage Company)
We have audited the accompanying consolidated balance sheet of Poker.com, Inc.
(formerly Thermal Ablation Technologies Corporation), (A Development Stage
Company) as at December 31, 1999 and the related consolidated statements of
operations, stockholders' equity and cash flows for the year then ended. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
in the United States. Those standards require that we plan and perform an audit
to obtain reasonable assurance 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 consolidated 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, these consolidated financial statements present fairly, in all
material respects, the financial position of the Company as at December 31, 1999
and the results of its operations and cash flows for the year ended December 31,
1999 in conformity with generally accepted accounting principles in the United
States.
The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in note 2 to the
consolidated financial statements, the Company has minimal capital resources
available and has incurred substantial losses to December 31, 1999. The Company
must obtain additional financing to meet its cash flow requirements. These
matters raise substantial doubt about the Company's ability to continue as a
going concern. These financial statements do not include any adjustments that
may result from the outcome of these uncertainties.
Chartered Accountants
Vancouver, Canada
March 14, 2000
4
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Balance Sheets
March 31, 2000 (Unaudited) and December 31, 1999 and 1998
(U.S. Dollars)
<TABLE>
<CAPTION>
========================================================================================================================
March 31, December 31,
2000 1999 1998
------------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C>
Assets
Current
Cash $ 188,483 $ 41,132 $ 5,898
Accounts receivable 180,160 99,405 0
Advances to related party 0 0 17,223
Prepaid expenses 5,154 2,635 0
------------------------------------------------------------------------------------------------------------------------
Total Current Assets 373,797 143,172 23,121
Long-Term Receivable (note 4) 150,000 150,000 0
Property and Equipment (note 5) 116,949 100,822 0
Intangible Assets (notes 6 and 7) 220,625 222,812 0
Long-Term Investment (note 8) 0 0 90,298
------------------------------------------------------------------------------------------------------------------------
Total Assets $ 861,371 $ 616,806 $ 113,419
========================================================================================================================
Liabilities
Current
Accounts payable and accrued
liabilities (notes 7 and 9) $ 304,353 $ 195,527 $ 12,350
Advances from related parties (note 11(d)) 11,371 95,927 0
------------------------------------------------------------------------------------------------------------------------
Total Liabilities 315,724 291,454 12,350
------------------------------------------------------------------------------------------------------------------------
Contingencies and Commitments (notes 12 and 14)
Stockholders' Equity (note 10)
Preferred Stock, $0.01 par value, 5,000,000 shares authorized, no
shares issued and outstanding
Common Stock and Paid-In Capital in Excess of $0.01 Par Value
100,000,000 Shares authorized
5,200,000 (1999 - 4,700,000; 1998 - 4,000,000) shares 1,010,000 510,000 160,000
issued and outstanding
Subscriptions Received 360,000 500,000 100,000
Other Comprehensive Loss (14,130) (14,130) 0
Deficit Accumulated During the Development Stage (810,223) (670,518) (158,931)
------------------------------------------------------------------------------------------------------------------------
Total Stockholders' Equity 545,647 325,352 101,069
------------------------------------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $ 861,371 $ 616,806 $ 113,419
========================================================================================================================
</TABLE>
See notes to consolidated financial statements. 5
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Operations
Three Months Ended March 31, 2000 (Unaudited), Years Ended December 31, 1999 and
1998 and Period From May 3, 1989 (Inception) Through December 31, 1999
(U.S. Dollars)
================================================================================
<TABLE>
<CAPTION>
Period From
May 3, 1989
Three (Inception)
Months Ended Through
March 31, Year Ended December 31, March 31,
2000 1999 1998 2000
----------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C> <C>
Revenues
Marketing $ 257,220 $ 50,280 $ 0 $ 307,500
Miscellaneous 0 108 906 1,014
----------------------------------------------------------------------------------------------------------------------
Total Revenues 257,220 50,388 906 308,514
Cost of Goods Sold 28,689 27,793 0 56,482
----------------------------------------------------------------------------------------------------------------------
Gross Margin 228,531 22,595 906 252,032
----------------------------------------------------------------------------------------------------------------------
Expenses
Website marketing 220,668 136,573 0 357,241
Corporation promotion 67,471 39,802 1,412 108,685
Office supplies and services 40,337 29,059 2,340 71,736
Management and consulting fees 19,095 43,573 61,681 134,349
Rent 6,631 21,101 11,460 39,192
Professional fees 2,962 45,996 71,428 120,386
Compensation expense (note 11(b)) 0 125,000 0 125,000
Investment written off (note 8) 0 140,297 0 140,297
General corporate expenses (2,269) 9,856 1,516 9,103
Depreciation and amortization 13,341 7,925 0 21,266
----------------------------------------------------------------------------------------------------------------------
Total Expenses 368,236 599,182 149,837 1,127,255
----------------------------------------------------------------------------------------------------------------------
Loss from Operations (139,705) (576,587) (148,931) (875,223)
Gain on Sale of Asset 0 65,000 0 65,000
----------------------------------------------------------------------------------------------------------------------
Net Loss for Period $ (139,705) $ (511,587) $ (148,931) $ (810,223)
======================================================================================================================
Net Loss Per Share $ (0.03) $ (0.12) $ (0.06)
======================================================================================================================
Weighted Average Number of
Common Shares Outstanding 5,097,849 4,291,667 2,536,986
======================================================================================================================
</TABLE>
See notes to consolidated financial statements. 6
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity
Three Months Ended March 31, 2000 (Unaudited), Years Ended December 31, 1999 and
1998 and Period From May 3, 1989 (Inception) Through December 31, 1999
(U.S. Dollars)
================================================================================
<TABLE>
<CAPTION>
Period From
May 3, 1989
Three (Inception)
Months Ended Through
March 31, Year Ended December 31, March 31,
2000 1999 1998 2000
-------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C> <C>
Shares of Common Stock Issued
Balance, beginning of period 4,700,000 4,000,000 1,000,000 (i) 0
Issued for
Services (note 11(b)) 0 250,000 0 1,000,000
Cash 500,000 200,000 (iii) 3,000,000 (ii) 3,200,000
Intangible assets (note 6) 0 250,000 (iii) 0 500,000
-------------------------------------------------------------------------------------------------------------------
Balance, end of period 5,200,000 4,700,000 4,000,000 4,700,000
===================================================================================================================
Common Stock and Paid-In Capital
In Excess of Par
Balance, beginning of period $ 510,000 $ 160,000 $ 10,000 $ 0
Issued for
Services (note 11(b)) 0 125,000 0 10,000
Cash 500,000 100,000 150,000 250,000
Intangible assets (note 6) 0 125,000 0 250,000
-------------------------------------------------------------------------------------------------------------------
Balance, end of period $1,010,000 $ 510,000 $ 160,000 $ 510,000
===================================================================================================================
Subscriptions Received
Balance, beginning of period $ 500,000 $ 100,000 $ 0 $ 0
Issued (500,000) (100,000) 0 0
Subscriptions received 360,000 500,000 100,000 500,000
-------------------------------------------------------------------------------------------------------------------
Balance, end of period $ 360,000 $ 500,000 $ 100,000 $ 500,000
===================================================================================================================
Other Comprehensive Income
Balance, beginning of period $ (14,130) $ 0 $ 0 $ 0
Foreign currency translation loss 0 (14,130) 0 (14,130)
-------------------------------------------------------------------------------------------------------------------
Balance, end of period $ (14,130) $ (14,130) $ 0 $ (14,130)
===================================================================================================================
Deficit Accumulated During
Development Stage
Balance, beginning of period $ (670,518) $ (158,931) $ (10,000) $ 0
Net loss for period (139,705) (511,587) (148,931) (670,518)
-------------------------------------------------------------------------------------------------------------------
Balance, end of period $ (810,223) $ (670,518) $ (158,931) $ (670,518)
===================================================================================================================
Total Stockholders' Equity $ 545,647 $ 325,352 $ 101,069 $ 325,352
===================================================================================================================
</TABLE>
(i) Issued @ $0.01/share
(ii) Issued @ $0.05/share
(iii) Issued @ $0.50/share
See notes to consolidated financial statements. 7
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Cash Flows
Three Months Ended March 31, 2000 (Unaudited), Years Ended December 31, 1999 and
1998 and Period From May 3, 1989 (Inception) Through December 31, 1999 (U.S.
Dollars)
================================================================================
<TABLE>
<CAPTION>
Period From
May 3, 1989
Three (Inception)
Months Ended Through
March 31, Year Ended December 31, March 31,
2000 1999 1998 2000
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Activities
Net loss $(139,705) $(511,587) $(148,931) $ (810,223)
Adjustments to reconcile net loss to
net cash used by operating activities
Depreciation and amortization 13,341 7,925 0 21,266
Write-down of investment 0 140,297 0 140,297
Compensation expenses 0 125,000 0 125,000
Changes in non-cash working capital
Accounts receivable (80,755) (99,405) 0 (180,160)
Advances to related party 0 17,223 (17,223) 0
Prepaid expenses (2,519) (2,635) 0 (5,154)
Long-term receivable 0 (150,000) 0 (150,000)
Accounts payable and accrued liabilities 208,826 173,177 12,350 394,353
Due to officers and directors 0 10,000 0 10,000
Advances from (repayments to)
related parties (84,556) 95,927 0 11,371
-------------------------------------------------------------------------------------------------------------------------
Net Cash Used By Operating Activities (85,368) (194,078) (153,804) (443,250)
-------------------------------------------------------------------------------------------------------------------------
Investing Activities
Acquisition of investment 0 (49,999) (90,298) (140,297)
Purchase of property, equipment
and intangible assets (27,281) (206,559) 0 (233,840)
-------------------------------------------------------------------------------------------------------------------------
Net Cash Used By Investing Activities (27,281) (256,558) (90,298) (374,137
-------------------------------------------------------------------------------------------------------------------------
Financing Activities
Proceeds from issuance of common stock 0 100,000 150,000 260,000
Subscriptions received 260,000 400,000 100,000 760,000
-------------------------------------------------------------------------------------------------------------------------
Net Cash Provided By Financing Activities 260,000 500,000 250,000 1,020,000
-------------------------------------------------------------------------------------------------------------------------
Effect of Foreign Currency Translation
on Cash 0 (14,130) 0 (14,130)
-------------------------------------------------------------------------------------------------------------------------
Increase in Cash 147,351 35,234 5,898 188,483
Cash, Beginning of Period 41,132 5,898 0 0
-------------------------------------------------------------------------------------------------------------------------
Cash, End of Period $ 188,483 $ 41,132 $ 5,898 $ 188,483
=========================================================================================================================
Supplemental Disclosure of Non-Cash Transactions
Issue of common stock for settlement of debt $ 100,000 $ 0 $ 0 $ 100,000
Issue of common stock for assets $ 0 $ 125,000 $ 0 $ 125,000
=========================================================================================================================
</TABLE>
See notes to consolidated financial statements. 8
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Notes to Consolidated Financial Statements
Three Month Period Ended March 31, 2000 and Year Ended December 31, 1999
U.S. Dollars
(Unaudited)
================================================================================
1. BASIS OF PRESENTATION
These unaudited financial statements have been prepared in accordance with
generally accepted accounting principles in the United States for interim
financial information. These financial statements are condensed and do not
include all disclosures required for annual financial statements. The
organization and business of the Company, accounting policies followed by
the Company and other information are contained in the notes to the
Company's audited consolidated financial statements filed as part of the
Company's December 31, 1999 Form 10-SB.
In the opinion of the Company's management, these financial statements
reflect all adjustments necessary to present fairly the Company's
consolidated financial position at March 31, 2000 and December 31, 1999 and
the consolidated results of operations and the consolidated statement of
cash flows for the three months then ended. The results of operations for
the three months ended March 31, 2000 are not necessarily indicative of the
results to be expected for the entire fiscal year.
2. SUBSCRIPTIONS RECEIVED
Pursuant to a private placement in March 2000, the Company received
subscriptions for 360,000 units and proceeds of $360,000 were received in
January and February 2000. Each unit consists of one share of common stock
and one share purchase warrant. Each warrant is exercisable into one share
of common stock at an exercise price of $1 per warrant expiring December
31, 2001. The 360,000 shares subscribed have yet to be issued.
9
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
May 1, 2000
POKER.COM INC (PKER.OB)
Quarterly Report (SEC form 10-QSB)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(All figures are in thousands of US dollars)
OVERVIEW
Poker.com Inc is a licensing and marketing company that licenses turnkey
Internet gaming systems and has the exclusive worldwide rights to market the
poker.com domain name. The Company's main sources of revenue are derived from
sub-licensing fees, ongoing royalty fees, an opt-in advertising program, and
banner advertising.
Casino Marketing, SA (a wholly owned subsidiary of Poker.com Inc) sells Casino
and Poker card room sub-licenses and derives its revenue from the sub-licensing
fees and royalty payments. The Company has sold 12 sub-licenses to date of which
4 are currently operational.
Poker.com intends to establish www.poker.com as the ultimate gaming portal on
-------------
the Internet.
RESULTS OF CONTINUING OPERATIONS
The following table sets forth for the periods indicated selected information
from Poker.com's consolidated statement of operations:
Three Months Ended March 31,
----------------------------
2000
----
(IN THOUSANDS)
Net Sales 257
Gross Margin 228
Operating Expenses 368
Income (loss) from continuing operations (140)
Net (loss) Income (140)
Information is shown only for the three months ended March 31, 2000 as the
corporation did not actively carrying on business in the first quarter of 1999.
10
<PAGE>
THREE-MONTH PERIOD ENDED MARCH 31, 2000
NET SALES. Net sales for the three months ended March 31, 2000 was $257.
Sub-license revenues was $55, banner advertising revenues was $121 and royalty
fees was $79 for the three months ended March 31, 2000 respectively.
The Company believes that royalty revenue from casinos and the new Poker card
room software will substantially improve the gross revenues for the next
quarter. These are forward-looking statements, particularly as related to the
business plans of the company, within the meaning of Section 27A of the
Securities Act of 1993 and Sections 21E of the Securities Exchange Act of 1934
and are subject to the safe harbor created by these sections. Actual results may
differ materially from the company's expectations and estimates.
GROSS MARGIN. Gross margin was 89% of net sales for the three months ended March
31, 2000. Management believes the margin is consistent with licensing and
marketing of turnkey Internet gaming systems. Poker.com's gross margin may be
affected by several factors including (i) the mix of revenues streams, (ii) the
price of products sold and (iii) other components of cost of sales.
OPERATING EXPENSES. Operating expenses for the three month ended March 31, 2000
was $368. The major expense items were for website marketing to bring traffic to
the Poker.com's portal and to develop the Company's name brand. This was
consistent with Poker's aggressive marketing campaign. The Company intends to
continue their aggressive marketing strategy.
PROVISION FOR INCOME TAXES. No tax provision was made for the three months ended
March 31, 2000. The Company also has available a net operating loss carry
forward of approximately $405 that may be used to offset future United States
federal taxable income.
FINANCIAL CONDITION AND LIQUIDITY
LIQUIDITY AND CAPITAL RESOURCES. At March 31, 2000 the Company had cash and cash
equivalents totaling $188 compared to $41 at December 31, 1999. The increase in
cash is mainly due to a subscription for common shares in the quarter ended
March 31, 2000. Poker.com's principal source of liquidity is $188 in cash
and cash equivalents.
Approximately $275 of the $330 accounts receivable and long term receivable was
due from Antico Holdings for the purchase of a Poker sub-license and Royalty
fees. The amount due from Antico Holdings for their License fee is payable in
equal installments
11
<PAGE>
over a period of three years. Antico Holdings has assigned to Poker.com Inc the
15% credit card hold back which will be released from June 2000.
Net cash (used) by operating activities for the quarter ended March 31, 2000 was
($85). The decrease in cash was mainly due to increase in accounts receivable of
$80 to $180 from December 31, 1999. This is due to royalty revenue, banner
advertising and sale of casino license fees being accrued.
Net cash (used) for investing activities for the three months ended March 31,
2000 was ($27). The cash was used for the purchase of additional capital assets
and casino software.
12
<PAGE>
PART II--OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities and Use of Proceeds
None.
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.
Exhibit No. Description
----------- ------------------------------------------------------------------
27.1 Financial Data Schedule.
(b) Reports on Form 8-K.
None.
13
<PAGE>
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.
Poker.com Inc
----------------------------
(Registrant)
Date 20 June 2000 /s/ M. Jackson
------------------------ -----------------------------
(Signature)* Secretary
Date ________________________ _____________________________
(Signature)*
--------------------------------------------------------------------------------
* Print the name and title of each signing officer under his signatures.
Form 10-QSB
14
