UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
(Check One) [ ] Form 10-K and Form 10-KSB[ ] Form 20-F [ ] Form 11-K
[X] Form 10-Q and Form 10-QSB[ ] Form N-SAR
For Period Ended: June 30, 2000
[ ] Transition Report on Form 10-K
[ ] Transition Report on Form 20-F
[ ] Transition Report on Form 11-K
[ ] Transition Report on Form 10-Q
[ ] Transition Report on Form N-SAR
For the Transition Period Ended: ______________________________
Read Attached Instruction Sheet Before Preparing Form. Please Print or Type.
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
If the notification relates to a portion of the filing checked above,
identify the Item(s) to which the notification relates:_______________________
PART 1
REGISTRANT INFORMATION
Full Name of Registrant: Price Net USA, Inc.
Former Name if Applicable: MNS Eagle Equity Group II, Inc.
Commission File No. 0-31319
Address of Principal Executive Office (Street and Number):
2575 McCabe Way
City, State and Zip Code: Irvine, CA 92614
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PART II
RULES 12b-25(b) AND (c)
If the subject report could not be filed without unreasonable effort or expense
and the registrant seeks relief pursuant to Rule 12b-25(b), the following should
be completed. (Check box if appropriate)
[ ] (a) The reasons described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or expense;
[x] (b) The subject annual report, semi-annual report, transition report on
Form 10-K, Form 20-F, 11-K, Form N-SAR, or portion thereof, will be filed
on or before the fifteenth calendar day following the prescribed due date;
or the subject quarterly report or transition report on Form 10-Q, or
portion thereof will be filed on or before the fifth calendar day following
the prescribed due date; and
[ ] (c) The accountant's statement or other exhibit required by Rule
12b-25(c) has been attached if applicable.
PART III
NARRATIVE
State below in reasonable detail the reasons why the Form 10-K and Form 10-KSB,
11-K, Form 10-Q and Form 10-QSB, N-SAR, or the transition report or portion
thereof could not be filed within the prescribed period. (Attach Extra Sheets if
Needed)
The Registrant was unable to file the Quarterly Report on Form 10-QSB for the
quarter ended June 30, 2000 without unreasonable effort or expense due to the
delay of our Independent Auditor completing the Review of the Financial
Statements.
PART IV
OTHER INFORMATION
(1) Name and telephone number of person to contact in regard to this
notification.
Allen Kimble 949 225-6200
(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under Section 13 or 15(d) of the
Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of
1940 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) been filed? If answer is no,
identify report(s). [X] Yes [ ] No
<PAGE>
(3) Is it anticipated that any significant change in results of operations from
the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion thereof?
[X] Yes [ ] No
If so, attach an explanation of the anticipated change, both narrative and
quantitative, and, if appropriate, state the reasons why a reasonable estimate
of the results cannot be made.
Results of Operations for the Three Months Ended June 30, 2000 Compared to Three
Months Ended June 30, 1999
Revenue
Revenue decreased to $701,579 for the three months ended June 30, 2000 from
$1,078,268 for the comparable period in 1999 as a result of the significant
reorganization and restructuring of our operation and customer base stemming
from the termination of our Company President. The three months ended June 30
1999 included a very aggressive mall site sales campaign. Of the $701,579
revenue for the three months ended June 30, 2000, $466,279 represents
independent mall site and merchandise sales and the remainder represents
long-distance phone service revenue of $235,300.
Cost of Sales
Cost of sales consists primarily of the costs of commissions paid to our network
of independent sales representatives. Cost of sales decreased to $526,013 for
the three months ended June 30, 2000 from $1,047,474 for the comparable period
in 1999. This $521 thousand decrease was primarily attributable to our decrease
in sales volume. Cost of sales for the three months ended June 30, 2000
represented 75% of the sales revenue as compared to 97% of the sales revenue for
the three months ended June 30, 1999 which generated an overall better gross
profit margin for the later period even though there was a decline in sales. We
expect the overall dollar cost of sales to increase in future periods to the
extent that our sales volume increases but not as a percentage of revenue.
<PAGE>
Operating Expenses
Selling, General and Administrative. Selling, general and administrative
expenses consist of advertising and promotional expenditures, payroll and
related expenses for executive and administrative personnel, facilities
expenses, professional and consulting services expenses, travel and other
general corporate expenses. Selling, general and administrative expenses
increased to $1.9 million for the three months ended June 30, 2000 from $705
thousand for the comparable period in 1999. Two significant non-cash
transactions totaling $747 thousand occurred during the three months ended June
30, 2000 as compared to the similar period, which contributed to the increased
costs. They include the amortization of the goodwill associated with the NCN
Communication acquisition for $308 thousand and the write down of inventory
items that totaled $439 thousand. Overall operating expenses are expected to
decrease as a percentage of revenue during future periods because our sales of
mall sites and merchandise are based on e-commerce, which allows increases in
the volume of purchases without having to incrementally add overhead. We expect
selling, general and administrative expenses to increase in absolute dollars as
we continue to pursue advertising and marketing efforts, expand our locations
worldwide, expand our staff and incur additional costs related to the growth of
our business and being a public company.
Net Loss
We incurred a net loss of $(1,774,799) for the three months ended June 30, 2000
as compared to $(675) thousand for the comparable period in 1999. Net loss for
the three months ended June 30, 2000 was primarily affected by the non-cash
transactions mentioned above.
Price Net USA, Inc.
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(Name of Registrant as Specified in Charter)
has caused this notification to be signed on its behalf by the undersigned
hereunto duly authorized.
Date: August 15, 2000 By: /s/ Allen Kimble
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Allen Kimble
Chief Financial Officer
