U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[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 Exchange Act.
COMMISSION FILE NUMBER 0-28875
TRANSWAVE CORPORATION
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(EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)
DELAWARE 95-4719023
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(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
22147 PACIFIC COAST HIGHWAY, SUITE 4, MALIBU, CALIFORNIA 90265
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(310) 317-6939
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(ISSUER'S TELEPHONE NUMBER)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports) and (2)
has been subject to such filing requirements for the past 90 days.
YES X NO
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As of May 8, 2000, there were 1,018,400 shares of Common Stock, $0.001 par
value, of the issuer outstanding.
Transitional Small Business Disclosure Format (check one)
YES NO X
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<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
INDEX
PART I. FINANCIAL INFORMATION PAGE NUMBER
Item 1. Financial Statements
BALANCE SHEET AS OF MARCH 31, 2000 2
STATEMENTS OF OPERATIONS FOR THE THREE MONTHS
ENDED MARCH 31, 2000 AND FOR THE PERIOD FROM
OCTOBER 27, 1998 (INCEPTION) TO MARCH 31, 2000 3
STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS
ENDED MARCH 31, 2000 AND FOR THE PERIOD FROM
OCTOBER 27, 1998 (INCEPTION) TO MARCH 31, 2000 4
NOTES TO FINANCIAL STATEMENTS 5-7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports filed on Form 8-K 8
Signatures 9
1
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
March 31,
December 31, 2000
1999 (unaudited)
--------------- -------------
ASSETS
TOTAL ASSETS $ - $ -
- ------------
=============== =============
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Loan payable to stockholder $ 95 $ 8,245
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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, 1,018,400 issued
and outstanding 1,018 1,018
Accumulated deficit during
development stage (1,113) (9,263)
--------------- -------------
TOTAL STOCKHOLDERS' DEFICIENCY (95) (8,245)
--------------- -------------
TOTAL LIABILITIES AND
- ----------------------
STOCKHOLDERS' DEFICIENCY $ - $ -
- ----------------------- =============== =============
See accompanying notes to financial statements
2
<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(UNAUDITED)
October 27,
1998 Three
(Inception) to Months Ended
March 31, 2000 March 31, 2000
-------------- -------------
REVENUES $ - $ -
-------------- -------------
EXPENSES
Accounting fees 2,500 2,000
Bank charges 95 -
Consulting fees 18 -
Legal fees 3,500 3,000
Office and postage expense 750 750
Rent 2,400 2,400
-------------- -------------
NET LOSS $ (9,263) $ (8,150)
- -------- ============== =============
Net loss per share - basic and
diluted $ (0.0131) $ (0.0080)
============== =============
Weighted average number of
shares outstanding during the
period - basic and diluted 706,139 1,018,400
============== =============
See accompanying notes to financial statements
3
<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(UNAUDITED)
October 27,
1998
(Inception) Three Months
to Ended March
March 31, 2000 31, 2000
--------------- ---------------
Cash flows from operating
activities
Net loss $ (9,263) $ (8,150)
Adjustments to reconcile net
loss to net cash
used in operating
activities:
Common stock issued for services 18 -
--------------- ---------------
Net cash used in operating (9,245) (8,150)
activities
--------------- ---------------
Cash flows from financing
activities
Proceeds from issuance of
common stock 1,000 -
Loan proceeds from stockholder 8,245 8,150
--------------- ---------------
Net cash provided by
financing activities 9,245 8,150
--------------- ---------------
NET INCREASE IN CASH - -
CASH AND CASH EQUIVALENTS -
BEGINNING - -
--------------- ---------------
CASH AND CASH EQUIVALENTS -
- ----------------------------
ENDING $ - $ -
- ------ =============== =============
See accompanying notes to financial statements
4
<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF MARCH 31, 2000
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) Organization and Description of Business
Transwave Corporation (a development stage company) (the
"Company") was incorporated in the State of Delaware on October
27, 1998 to engage in an internet-based business. At March 31,
2000, 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) Basis of Presentation
The accompanying unaudited financial statements have been prepared
in accordance with generally accepted accounting principles and
the rules and regulations of the Securities and Exchange
Commission for interim financial information. Accordingly, they do
not include all the information necessary for a comprehensive
presentation of financial position and results of operations.
It is management's opinion, however that all material adjustments
(consisting of normal recurring adjustments) have been made which
are necessary for a fair financial statements presentation. The
results for the interim period are not necessarily indicative of
the results to be expected for the year.
In addition, the accompanying financial statements do not include
the statement of operations or cash flows for the three months
ended March 31, 1999 since the Company was inactive during this
period.
For further information, refer to the financial statements and
footnotes included in the Company's form 10-KSB for the year ended
December 31, 1999.
5
<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF MARCH 31, 2000
(C) 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.
(D) 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.
(E) 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 or deferred income tax
expense or benefits due to the Company not having any material
operations for the period ended March 31, 2000.
(F) Loss Per Share
Net loss per common share for the three months ended March 31, 2000
and for the period from October 27, 1998 (inception) to March 31,
2000 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 March 31, 2000.
6
<PAGE>
TRANSWAVE CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF MARCH 31, 2000
NOTE 2 LOAN PAYABLE TO STOCKHOLDER
The loan payable to 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 100,000 shares of
preferred stock at $.01 par value, with such designations,
preferences, limitations and relative rights as may be determined
from time to time by the Board of Directors. It was also originally
authorized to issue 10,000,000 shares of common stock at $.001 par
value. The Company issued 909,200 and 109,200 shares to AppleTree
Investment Company, Ltd. and PageOne Business Productions, LLC,
respectively. No preferred shares were issued as of March 31, 2000.
Management filed a restated certificate of incorporation with the
State of Delaware which increased the number of authorized common
shares to 100,000,000, increased the number of authorized preferred
shares to 8,000,000 and decreased the par value of the preferred
shares to $.001 per share.
The financial statements at March 31, 2000 give effect to common and
preferred stock amounts and par values enumerated in the restated
certificate of incorporation.
NOTE 4 GOING CONCERN
As reflected in the accompanying financial statements, the Company
has had accumulated losses of $9,263 since inception, a working
capital deficiency of $8,245 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.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
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 report. For the period since inception (October 27, 1998) through March
31, 2000, during the Company's development stage, the Company has a zero cash
balance and has generated a net loss of ($9,263).
FINANCIAL CONDITION AND LIQUIDITY
The Company has a working capital deficiency of $8,245 and has an ongoing
need to finance its activities. To date, the Company has funded these cash
requirements by offering and selling its Common Stock, in addition to cash
advances from a stockholder, and has issued 1,018,400 shares of Common Stock for
net proceeds of $1,018.00. Operating costs for the current period were funded by
a loan from a stockholder.
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.
PART II OTHER INFORMATION
Item 6. Exhibits and Reports filed on Form 8-K
(a) Exhibits
Exhibit No. Description
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27 Financial Data Schedule
(b) Reports on Form 8-K
None.
8
<PAGE>
SIGNATURES
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In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
TRANSWAVE CORPORATION
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Registrant
May 15, 2000 By: /s/ James P. Walters
------------ --------------------------------
James P. Walters
Chief Financial Officer
(Principal Financial Officer)
9
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ---------- -----------
27 Financial Data Schedule
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 8,245
<BONDS> 0
0
0
<COMMON> 1,018
<OTHER-SE> (9,263)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 8,150
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (8,150)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,150)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
