As filed with the Securities and Exchange Commission on August 11, 2000
Registration No. ________
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
------------------------------------------------
For quarter ended June 30, 2000
Commission File Number 000-29923
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
(Name of Small Business Issuer in Its Charter)
Colorado (7310) 84-1463284
----------------------------------------------------------------
(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
101 Philippe Parkway, Suite 300
Safety Harbor, Florida 34695
(727) 797-6664
--------------
(Address and Telephone Number of Principal Executive Offices and Principal
Place of Business)
John D. Thatch, President
New Millennium Media International, Inc.
101 Philippe Parkway Suite 300
Safety Harbor, Florida 34695
----------------------------
(Name, Address and Telephone Number of Agent for Service)
Copies to:
Gerald C. Parker, Chairman of the Board of Directors
7820 South Holiday Drive
Suite 320
Sarasota, Florida 34321
(941) 925-2500
Fax (941) 925-2503
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 June 30, 2000 there were 23,079,462 shares of the Company's common stock
issued and outstanding.
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
Filing Type: 10-QSB
Description: Quarterly Report
Filing Date: August 11, 2000
Period End: June 30, 2000
Primary Exchange: Over the Counter Includes OTC and OTCBB
Ticker: NMMI
2
<PAGE>
TABLE OF CONTENTS
--------------------------------------------------------------------------------
Page
----
Part I Financial Information...............................................5
Item 1 Financial Statements.............................................5
Item 2 Management's Discussion and Analyses of Financial Condition and
Results of Operations...........................................10
Item 3 Quantitative and Qualitative Disclosures About Market Risk......11
Part II Other Information..................................................11
Item 1 Legal Proceedings...............................................11
Item 2 Changes in Securities and Use of Proceeds.......................11
Item 3 Defaults Upon Senior Securities.................................12
Item 4 Submission of Matters to a Vote of Security Holders.............12
Item 5 Other Information...............................................12
Item 6 Exhibits and Reports on Form 8-K................................12
Signatures....................................................................12
3
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
INDEX
Page
----
Part I Financial Information..................................................5
Item 1 Financial Statements ..........................................5
Report of Independent Accountants..............................5
Condensed Balance Sheet........................................6
Condensed Statement of Operations..............................7
Condensed Statement of Cash Flows..............................8
Notes to the Condensed Financial Statements....................9
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations..............10
Overview......................................................10
Plan of Operatiuons...........................................10
Results of Operations.........................................10
General and Administrative Expenses...........................10
Liquidity and Capital Resources...............................10
Item 3 Quantitative and Qualitative Disclosures About Market Risk....11
Part II Other Information.....................................................11
Item 1 Legal Proceedings.............................................11
Item 2 Changes in Securities and Use of Proceeds.....................11
Common Stock..................................................11
Warrants......................................................11
Preferred Stock...............................................11
Use of Proceeds...............................................11
Item 3 Defaults Upon Senior Securities...............................12
Item 4 Submission of Matters to a Vote of Security Holders...........12
Item 5 Other Information.............................................12
Item 6 Exhibits and Reports on Form 8-K..............................12
Signatures....................................................................12
4
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
--------------------------------------------------
Board of Directors and Shareholders
New Millennium Media International, Inc.
(formerly Progressive Mailer Corp.)
Safety Harbor, Florida
We have reviewed the condensed balance sheets of New Millennium Media
International, Inc. (formerly Progressive Mailer Corp.) (a development stage
company) as of December 31, 1999 and June 30, 2000, and the related statements
of operations and cash flows for the six months ended June 30, 1999 and 2000.
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
statements 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 accompanying consolidated interim financial statements for them
to be in conformity with generally accepted accounting principles.
We have previously audited, conducted in accordance with generally accepted
auditing standards, the consolidated balance sheet as of December 31, 1998 and
1999, and the related statements of operations, stockholders' deficit and cash
flows for the years then ended (not presented herein), and in our report dated
June 1, 2000, we expressed a qualified report because of going concern
uncertainty on those consolidated financial statements. In our opinion the
information set forth in the accompanying condensed balance sheet as of December
31, 1999, is fairly stated in all material respects in relation to the condensed
balance sheet from which it has been derived.
Richard J. Fuller, CPA, PA
Clearwater, Florida
August 9, 2000
5
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
(FORMERLY PROGRESSIVE MAILER CORP.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEET
<TABLE>
<CAPTION>
December 31, June 30,
1999 2000
(Unaudited)
----------- -----------
ASSETS
<S> <C> <C>
Current Assets:
Cash $ 2,063 $ 129,544
Inventories 548,862 567,612
----------- -----------
Total Current Assets 550,925 697,156
----------- -----------
Furniture and Equipment-Net 3,964 8,567
----------- -----------
Other Assets
Prepaid expenses-net 417 6,340
Goodwill, net of accumulated amortization
of $22,587and $33,881, respectively 655,007 644,213
----------- -----------
Total Other Assets 655,424 650,553
----------- -----------
$ 1,210,313 $ 1,356,276
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Notes payable - related $ 1,596,012 $ 1,611,012
Accounts payable 85,235 65,609
Accrued expenses payable 129,289 161,289
----------- -----------
Total Current Liabilities 1,810,536 1,837,910
----------- -----------
Long-term Liabilities -- --
Stockholders' Deficit
Common stock, par value $.001; shares authorized, 25,000,000
shares issued and outstanding, 24,099,881 and 23,079,462
respectively 24,100 23,080
Preferred stock, par value $.001; shares authorized, 10,000,000
no shares issued and outstanding -- --
Additional paid in capital 448,991 452,511
Common stock subscribed, (1,420,000 shares) -- 460,500
Deficit accumulated during the development stage (1,073,314) (1,417,725)
----------- -----------
Total Stockholders' Deficit (600,223) (481,634)
----------- -----------
$ 1,210,313 $ 1,356,276
=========== ===========
</TABLE>
6
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
(FORMERLY PROGRESSIVE MAILER CORP.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
FOR THE FOR THE FROM INCEPTION
SIX MONTHS SIX MONTHS THROUGH
06/30/99 6/30/00 6/30/00
----------- ----------- -----------
Income $ 6,911 $ 1,044 $ 60,852
Costs and Expenses:
General and administrative $ 203,283 $ 301,389 $ 1,286,016
Interest expense 45,724 32,000 155,921
Depreciation and amortization 600 12,066 36,640
----------- ----------- -----------
Total costs and expenses 249,607 345,455 1,478,577
----------- ----------- -----------
Loss from Operations (242,696) (344,411) (1,417,725)
Net Loss $ (242,696) $ (344,411) $(1,417,725)
=========== =========== ===========
Basic Loss Per Common Share $ (0.017) $ (0.015) $ (0.061)
=========== =========== ===========
7
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
(FORMERLY PROGRESSIVE MAILER CORP.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the For the From Inception
six months six months through
06/30/99 06/30/00 06/30/00
----------- ----------- -----------
<S> <C> <C> <C>
Cash Flows from Operating Activities:
Net loss $ (242,696) $ (344,411) $(1,417,725)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 600 12,066 36,840
Common stock issued for services 775 -- 24,838
Increase in inventories 198,383 (18,750) (567,612)
Increase in prepaid expenses -- (6,215) (6,215)
Increase (decrease) in accounts payable
and accrued expenses (83,188) 12,374 226,898
----------- ----------- -----------
Total adjustments 116,570 (525) (285,251)
----------- ----------- -----------
Net Cash Used in Operating Activities (126,126) (344,936) (1,702,976)
----------- ----------- -----------
Cash Flows from Investing Activities
Purchase of goodwill -- (500) (678,094)
Purchase of fixed assets -- (5,083) (16,542)
----------- ----------- -----------
Net Cash Used in Investing Activities -- (5,583) (694,636)
----------- ----------- -----------
Cash Flows from Financing Activities
Proceeds from notes payable - Related 121,000 15,000 1,611,012
Proceeds from common stock transactions -- 463,000 916,144
----------- ----------- -----------
Net Cash provided by Financing Activities 121,000 478,000 2,527,156
----------- ----------- -----------
Increase in cash and cash equivalents $ (5,126) $ 127,481 $ 129,544
Cash and cash equivalents at beginning of period $ 6,811 $ 2,063 $ --
----------- ----------- -----------
Cash and cash equivalents at end of period $ 1,685 $ 129,544 $ 129,544
=========== =========== ===========
Supplemental disclosure of cash flow information:
Cash paid during the year for interest -- -- --
Cash paid during the year for income taxes -- -- --
</TABLE>
8
<PAGE>
NEW MILLENNIUM MEDIA INTERNATIONAL, INC.
(FORMERLY PROGRESSIVE MAILER CORP.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. Organization and Basis of Presentation
-------------------------------------------
New Millennium Media International, Inc. (formerly Progressive Mailer
Corp.) (NMMI or the Company) is in the business of marketing advertising
space in special advertising display machines. The accompanying unaudited
condensed financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information
in accordance with rules and regulations of the Securities and Exchange
Commission, in particular, Regulation S-B. Accordingly, they do not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements and should be read
in conjunction with the Company's Annual Report (Form 10-KSB) for the years
ended December 31, 1998 and 1999. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the
quarter ended June 30, 2000 are not necessarily indicative of the results
that may be expected for the year ending December 31, 2000.
2. Development Stage Enterprise
---------------------------------
The Company is a development stage enterprise, as defined in Financial
Accounting Standards Board Statement No. 7 (SFAS No. 7). The Company is
devoting substantially all of its efforts in securing and establishing a
new business, and has engaged in limited activities in the advertising
business, but no significant revenues have been generated to date.
3. Going Concern Uncertainty
------------------------------
The Company has incurred recurring operating losses and negative cash flows
and has negative working capital. The Company has financed itself primarily
through the sale of its stock and related party borrowings. These
conditions raise substantial doubt about the Company's ability to continue
as a going concern.
There can be no assurance that the Company will be success in implementing
its plans, or if such plans are implemented, that the Company will be
successful.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern and do not include any adjustments
to reflect the possible future effect on the recoverability and
classification of assets or the amount and classification of liabilities
that might result from the outcome of this uncertainty.
4. Equity
-----------
On April 12, 2000, the Company entered into an agreement with Investment
Management of America, Inc. (a major stockholder and financial consultant)
to exchange 3,000,000 shares of Common Stock for 3,000,000 shares of Series
A Convertible Preferred Stock of the 5,000,000 shares created under
resolution of the Board of Directors of the 10,000,000 Preferred Stock.
5. Subsequent Events
----------------------
The Company increased the number of Common Stock authorized to 75,000,000
at a special Meeting of Stockholders on July 17, 2000. In addition, the
Company has secured an agreement with a financial institution to provide an
equity line of $25,000,000 and Plans to file an SB-2 Registration Statement
with the SEC.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
The discussion and financial statements contained herein are for the six months
ended June 30, 1999 and 2000 and from inception through June 30, 2000. The
following discussion regarding the financial statements of the Company should be
read in conjunction with the financial statements of the Company included
herewith.
OVERVIEW
The Company is a development stage company as defined in Statement of Financial
Accounting Standards No. 7, "Accounting and Reporting by Development Stage
Enterprises." The Company is devoting substantially all of its present efforts
to establish a new business and its planned principal operations are in the
initial stages. All losses accumulated since inception have been considered as
part of the Company's development stage activities. The Company has had very
limited operations and revenues since its inception.
PLAN OF OPERATIONS
The statements contained in this section include projections of future results
and "forward-looking statements" as that term is defined in Section 27A of the
Act, and Section 21E of the Exchange Act. All statements that are included in
this report, other than statements of historical fact, are forward-looking
statements. Although Management believes that the expectations reflected in
these forward-looking statements are reasonable, it can give no assurance that
such expectations will prove to have been correct. Important factors that could
cause actual results to differ materially from the expectations are disclosed in
this report, including, without limitation, in conjunction with those
forward-looking statements contained in this report.
The primary activity of the Company currently involves two types of visual
advertising: The Illumisign-Eyecatcher movable display boards and LED display
boards. We retain ownership of both types of the machines and sell the
advertising space on a monthly basis.
RESULTS OF OPERATIONS
Comparable operations for the quarter ended June 30, 2000 and December 31, 1999
reflect the final stages of the corporate headquarters being reorganized and
moved to Safety Harbor, Florida with a change in management. The lack of revenue
is due to these corporate changes and management's consolidation of operations
from its current location. The Company signed a one-year with option for
successive additional one year terms marketing agreement with
Carson-Jensen-Anderson Enterprises, Inc. through which agreement the
Illumisign-Eyecatcher display boards will be marketed throughout the 50 United
States. Management anticipates that operations, including Illumisign-Eyecatcher
display board inventories during the next few months will cause costs to
slightly increase relative to revenue generated from the rental of the display
boards. As the display boards are placed at site locations and advertisers begin
placing ads it is anticipated that the revenues will gradually increase.
Personnel costs should also increase slightly with the increased advertising
accounts. In addition, certain direct costs including depreciation of display
boards will increase as these machines are placed at various site locations.
Amortization should remain the same.
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses include costs of the final stages of
reorganizing and relocating corporate headquarters as well as the expenses of
negotiating and finalizing the various contracts necessary to develop the
national network for locating sites and marketing the various advertisers
necessary to place the ads in the display boards. These expenses include costs
of management and other indirect costs including marketing, rent, accounting,
legal and operating costs.
LIQUIDITY AND CAPITAL RESOURCES
Cash used for operating activities totaled $344,936 for the six months ended
June 30, 2000 vs. $126,126 in the comparable period in 1999. Cash was used
primarily in reorganizing the corporate organization and salaries. Cash outflows
for investing activities were primarily for fixed assets that should continue
during the next twelve months as the Company's business increases. Funds were
provided from financing activities including proceeds from stock transactions of
$463,000 during the six months ended June 30, 2000.
On May 19, 2000, we entered into an investment agreement with Swartz Private
Equity, LLC to provide an equity line maximum aggregate amount of $25,000,000
through a series of sales of common stock. In order to sell shares to Swartz,
there must be an effective registration statement with the SEC covering the
resale of the shares by Swartz and certain other conditions must be met. The
agreement is for a period of three years from the
10
<PAGE>
effective date of a registration statement covering the resale of the shares to
be put to Swartz. It is reasonably anticipated that the registration statement
will be filed within the next month.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Registrant is a Small business issuer as defined by these Regulations and need
not provide the information required by this Item 3.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is a defendant in a lawsuit filed on November 5, 1999 in the Circuit
Court of the Eleventh Judicial Circuit in and for Miami-Dade County, Florida,
Case Number 99-26073 CA 10. The plaintiff, Joseph Maenza, is seeking to collect
payment of a promissory note in the principal amount of $50,000 plus interest
from February 1999 and attorney fees. The Company filed an Answer and
Affirmative Defenses alleging, among other issues, that the interest stated in
the promissory note is usurious. On August 3, 2000 this case was dismissed
without prejudice. As of the filing of this report, the plaintiff has not
refilled the suit.
The Company is a defendant in a lawsuit filed August 31, 1999 in the District
Court, County of Denver, State of Colorado, Case Number 99CV5768. The plaintiff,
International Vending Management, Inc., is seeking damages for failure to
perform on a contract wherein plaintiff contracted to place advertising machines
and manage the cash flow. The Company filed defenses and a counterclaim stating
that plaintiff failed to perform and lost or misplaced eleven machines.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
COMMON STOCK
Swartz Investment Agreement. On May 19, 2000, we entered into an Investment
Agreement with Swartz Private Equity, LLC. The Investment Agreement entitles us
to issue and sell our common stock to Swartz for up to an aggregate of $25
million from time to time during the three-year period following the date of
effectiveness of a registration statement covering the resale of the shares to
be put to Swartz. Each election by us to sell stock to Swartz is referred to as
a "put right".
In order to comply with the requirements of the Swartz agreement July 17, 2000
the Company passed a resolution to amended its Articles of Incorporation to
increase the authorized number of common stock from 25,000,000 to 75,000,000. It
is a requirement of the Swartz Investment Agreement that the Company file an
SB-2 Registration. It is anticipated that this registration will be filed within
the next month.
Please see "Common Stock" in the 10-QSB Report for the Company's first quarter
of 2000 which section is incorporated by reference herein.
WARRANTS
Please see "Warrants" in the 10-QSB Report for the Company's first quarter of
2000 which section is incorporated by reference herein.
PREFERRED STOCK
Please see "Preferred Stock" in the 10-QSB Report for the Company's first
quarter of 2000 which section is incorporated by reference herein.
USE OF PROCEEDS
Please see "Use of Proceeds" in the 10-QSB Report for the Company's first
quarter of 2000 which section is incorporated by reference herein.
11
<PAGE>
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
By vote of the shareholders of the Company, the Company Articles of
Incorporation were amended to increase the number of common stock from
25,000,000 to 75,000,000 shares. A Proxy Statement was sent to each shareholder
of record. See Item 2 above.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (SECT. 249.308 OF THIS CHAPTER).
Financial Statements are incorporated in the body of this report.
No reports on Form 8-K have been filed during the quarter for which this report
is filed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Signed and submitted this 11th day of August 2000.
New Millennium Media International, Inc.
(Registrant)
by: /s/ John Thatch
--------------------------------
John Thatch as President/CEO
12
