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 Quarter Ended: March 31, 2000
OR
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Commission File No. 0-29379
LearnCom, Inc.
(Exact name of registrant as specified in its charter)
Nevada 87-0622927
(State of incorporation) (I.R.S. Employer
Identification No.)
525 South 300 East
Salt Lake City, Utah 84111
(801) 323-2395
(Address and telephone number of principal
executive offices and principal place of business)
Smoky Hill Services, Inc.
(Former name or former address if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 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 [ ]
As of May 10, 2000, the Registrant had a total of 755,750,000 shares of
common stock issued and outstanding.
<PAGE>
TABLE OF CONTENTS
PART I: FINANCIAL INFORMATION
Item 1: Financial Statements 3
Item 2: Management's Discussion and Analysis or Plan of Operations 11
PART II: OTHER INFORMATION
Item 5: Other Events 12
Item 6: Exhibits and Reports filed on Form 8-K 13
Signatures 14
<PAGE>
PART I: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
Smoky Hills Services, Inc.
(a Development Stage Company)
Consolidated Financial Statements
March 31, 2000
<PAGE>
CROUCH, BIERWOLF & CHISHOLM
Certified Public Accountants
50 West Broadway, Suite 1130
Salt Lake City, Utah 84101
Office (801) 363-1175
Fax (801) 363-0615
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Smoky Hills Services, Inc.
Salt Lake City, Utah
We have reviewed the accompanying condensed consolidated balance sheet of
Smoky Hills Services, Inc. as of March 31, 2000 and the related condensed
consolidated statements of income and cash flows for the period then ended.
These financial statements are the responsibility of the company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred to
above for them to be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1999, and the
related consolidated statements of income, retained earnings, and cash flows
for the year then ended (not presented herein); and in our report dated
January 10, 2000, we expressed an unqualified opinion on those financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of March 31, 2000, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.
The accompanying statements of operations and cash flows for the period ended
March 31, 1999 were not audited by us and, accordingly, we do not express an
opinion on them.
/s/ Crouch, Bierwolf & Chisholm
Crouch, Bierwolf & Chisholm
May 10, 2000
<PAGE>
Smoky Hills Services, Inc.
(a Development Stage Company)
Consolidated Balance Sheets
Assets
March 31, December 30,
2000 1999
---------- ----------
(Unaudited)
Current assets
Cash $ - $ -
---------- ----------
Total Current Assets $ - $ -
---------- ----------
Total Assets $ - $ -
========== ==========
Liabilities and Stockholders' Equity
CURRENT LIABILITIES
Accounts payable $ 30,000 $ 30,000
---------- ----------
Total Current Liabilities 30,000 30,000
---------- ----------
STOCKHOLDERS' EQUITY (DEFICIT)
Common Stock, authorized
50,000,000,000 shares of $.001 par
value, issued and outstanding
17,000,000 and 17,000,000 shares,
respectively 17,000 17,000
Deficit Accumulated During the
Development Stage (47,000) (47,000)
---------- ----------
Total Stockholders' Equity (Deficit) (30,000) (30,000)
---------- ----------
Total Liabilities and Stockholders'
Equity $ - $ -
========== ==========
The accompanying notes are an integral part of these financial statements
<PAGE>
Smoky Hills Services, Inc.
(a Development Stage Company)
Consolidated Statements of Operations
Cumulative
For the Three Months Total
Ended March 31, Since
2000 1999 Inception
---------- ---------- ----------
Revenues $ - $ - $ -
Expenses:
Consulting fees - - -
Legal - - -
Accounting - - -
General & Administrative - - 47,000
---------- ---------- ----------
Total Expenses - - 47,000
---------- ---------- ----------
Net loss before
discontinued operations $ - $ - (47,000)
---------- ---------- ----------
Loss on discontinued
operations - - -
Net Loss $ - $ - $(47,000)
---------- ---------- ----------
Weighted Average Loss Per
Share $ (.000) $ (0.00) $ (0.003)
---------- ---------- ----------
Weighted Average
Shares Outstanding 17,000,000 17,000,200 17,000,000
========== ========== ===========
The accompanying notes are an integral part of these financial statements
<PAGE>
Smoky Hill Services, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
From
Inception on
March 28,
For the Three Months 1986 through
ended March 31, March 31,
2000 1999 2000
---------- ---------- ----------
Cash Flows from Operating
Activities:
Net loss $ - $ - $ (47,000)
Non-cash services
rendered
and expenses paid by
stockholders' - - 17,000
Increase (decrease) in
current liabilities - - 30,000
---------- ---------- ----------
Net Cash Provided (Used)
by Operating Activities - - -
---------- ---------- ----------
Cash Flows from Investment
Activities: - - -
---------- ---------- ----------
Cash Flows from Financing
Activities:
Issuance of common stock - - -
---------- ---------- ----------
Net Cash Provided by
Financing Activities - - -
---------- ---------- ----------
Net increase (decrease) in
cash - - -
Cash, beginning of period - - -
---------- ---------- ----------
Cash, end of period $ - $ - -
========== ========== ==========
Cash, paid during
the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Noncash financing activities
Issuance of common
stock for marketing
rights $ - $ - $ 17,000
Issuance of common
stock for
stockholders' payable $ - $ - $ -
Issuance of stock for
services rendered $ - $ - $ -
The accompanying notes are an integral part of these financial statements.
<PAGE>
Smoky Hills Services, Inc.
(a Development Stage Company)
March 31, 2000
The accompanying notes are an integral part of these financial statements
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
GENERAL
Smoky Hills Services, Inc. (the Company) has elected to omit substantially all
footnotes to the financial statements for the three months ended March 31,
2000 since there have been no material changes (other than indicated in other
footnotes) to the information previously reported by the Company in their
Annual Report filed of Form 10-KSB for the Fiscal year ended December 31,
1999.
UNAUDITED INFORMATION
The information furnished herein was taken from the books and records of the
Company without audit. However, such information reflects all adjustments
which are, in the opinion of management, necessary to properly reflect the
results of the interim period presented. The information presented is not
necessarily indicative of the results from operations expected for the full
fiscal year.
<PAGE>
In this report references to "LearnCom," "we," "us," and "our" refer to
LearnCom, Inc.
FORWARD LOOKING STATEMENTS
This Form 10-QSB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. For this
purpose any statements contained in this Form 10-QSB that are not statements
of historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements. These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
LearnComs' control. These factors include but are not limited to economic
conditions generally and in the industries in which LearnCom may participate;
competition within LearnComs' chosen industry, including competition from much
larger competitors; technological advances and failure by LearnCom to
successfully develop business relationships.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
Plan of Operations
For the three months ended March 31, 2000 we have had no business
operations and had no full time employees. We have no assets and have had
recurring operating losses for several years and are reliant on financing to
continue operations. Since inception, we have financed our operations
primarily by the sale of our common stock. We had an account payable for
$30,000 and no other material commitments for the next twelve months.
Management believes that our current cash needs can be met with loans from
management or shareholders for at least twelve months.
We are currently in negotiations with LearnCom, Inc., an Illinois
corporation, we wish to acquire. See Part II, Item 5 "Other Information" for
more detail regarding this potential acquisition. We intend to complete a
share exchange of our common stock to facilitate the acquisition. We will
likely need to raise additional capital after the acquisition to provide
working capital for operations. This may be accomplished by selling our
common stock or debt financing.
If common stock is issued it will be issued pursuant to available
exemptions provided by federal and state securities laws. The purchasers and
manner of issuance will be determined according to our financial needs and the
available exemptions. We do not currently intend to make a public offering of
our stock. We also note that if we issue more shares of our common stock our
shareholders may experience dilution in the value per share of their common
stock.
If we fail to raise the necessary funds through private placements, we
anticipate we will require debt financing. We have not investigated the
availability, source and terms for external financing at this time and we can
not assure that funds will be available from any source, or, if available,
that we will be able to obtain the funds on terms agreeable to us. Also, the
acquisition of funding through the issuance of debt could result in a
substantial portion of our cash flows from operations being dedicated to the
payment of principal and interest on the indebtedness, and could render us
more vulnerable to competitive and economic downturns.
Potential investors must recognize that because of our limited capital
available for investigation and management's limited experience in business
analysis, we may not discover or adequately evaluate adverse facts about the
business opportunity to be acquired. Also, we intend to concentrate our
acquisition efforts on properties or businesses that we believe to be
undervalued or that we believe may realize a substantial benefit from being
publicly owned. Investors should expect that any acquisition candidate may
have little or no operating history, or a history of losses or low
profitability.
It is emphasized that our management may effect transactions having a
potentially adverse impact upon our shareholders pursuant to the authority and
discretion of our management to complete acquisitions without submitting any
proposal to the stockholders for their consideration.
PART II: OTHER INFORMATION
ITEM 2: CHANGES IN SECURITIES
(a) On May 11, 2000 we increased our authorized common shares from
50,000,000 to 2,000,000,000.
(c) On May 5, 2000 we issued an aggregate of 15,000 common shares valued at
par. We issued 7,500 shares each to Ariika Mason, our President, and to Brett
Mayer, our Secretary/Treasurer, for their services as our officers and
directors. These shares were issued pursuant to an exemption from
registration under the Securities Act of 1933 by reason of Section 4(2) as a
private transaction not involving a public distribution.
ITEM 5: OTHER INFORMATION
We currently intend to enter into an acquisition agreement with LearnCom.
Inc., however, we have not reached a definitive agreement with LearnCom.
LearnCom is an Illinois corporation, who provides human resource, management
and safety training courseware and consulting services delivered through
technological channels. In preparation for the acquisition, on May 3, 2000 we
issued 4,000,000 common shares in the name of LearnCom, Inc. and placed them
in escrow with our transfer agent, Standard Registrar and Transfer. We intend
to use theses shares in a anticipated share exchange. On May 4, 2000 our
parent corporation, VIP Worldnet, Inc., returned and canceled 14,955,000
common shares to the corporate treasury in order to increase the
capitalization available for any potential share exchange. Our Board
authorized a 125-for-1 forward split to become effective on May 10, 2000
resulting in 755,750,000 common shares outstanding. On May 11, 2000 we
changed our name to LearnCom, Inc. and changed our trading symbol on the
National Quotation Bureau Pink Sheets from "SMKY" to "LRNC."
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Part I
Exhibit Description
------- -----------
24 Consent of Crouch, Bierwolf & Chisholm dated May 10, 2000
27 Financial Data Schedule
Part II
3.1 Certificate of Amendment filed May 11, 2000.
(b) Reports on Form 8-K.
None.
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 who are duly authorized.
LearnCom, Inc.
Date: 5/12/00
By: /s/ Ariika Mason
----------------
Ariika Mason, President
Date: 5/12/00
By: /s/ Brett Mayer
---------------
Brett Mayer, Secretary/Treasurer
CERTIFICATE OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
SMOKY HILL SERVICES, INC.
We the undersigned as President and Secretary of Smoky Hill Services,
Inc. do hereby certify:
That the Board of Directors of said Corporation at a meeting duly
convened and held on May 6, 2000 adopted a Resolution to amend the Articles of
Incorporation as follows:
A. Delete Article I in its entirety and
substitute in its place the following:
ARTICLE I
The name of the Corporation is LearnCom, Inc.
B. Delete Article II in its entirety and substitute in
its place the following:
ARTICLE II
The aggregate number of shares which this Corporation shall have the
authority to issue is 2,000,000,000 shares of Common Stock, $.001 par value
per share, all of such common shares shall have the same rights and
preferences and shall be nonassessable
Before this Amendment, 50,000,000 shares of Common Stock with a $.001 par
value were authorized and of those authorized 6,060,000 were issued and
outstanding.
The above Amendments to the Articles of Incorporation were adopted by the
holders of a majority, 4,725,000 common shares of the 6,060,000 outstanding
common shares of the Corporation on May 6, 2000.
/s/ Ariika Mason
-----------------------------
President
/s/ Brett Mayer
-----------------------------
Secretary
STATE OF UTAH )
: ss.
COUNTY OF SALT LAKE )
On this 10th day of May 2000, personally appeared before me Ariika Mason
and Brett Mayer, personally known to me or proved to me on the basis of
satisfactory evidence to be the persons whose names are signed on the
preceding document, and acknowledged to me that they signed it voluntarily for
its stated purpose.
Anita Patterson
- --------------------------
NOTARY PUBLIC
<Notary Public Stamp appears here>
CROUCH, BIERWOLF & CHISHOLM
Certified Public Accountants
50 West Broadway, Suite 1130
Salt Lake City, Utah 84101
Office (801) 363-1175
Fax (801) 363-0615
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We hereby consent to the use of our report, dated May 10, 2000, in
this quarterly report on Form 10-Q for Smoky Hills Services, Inc.
/s/ Crouch, Bierwolf & Chisholm
Crouch, Bierwolf & Chisholm
Salt Lake City, Utah
May 10, 2000
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