SECURITIES & EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
February 22, 2000
Exact Name of Registration as Specified in Charter:
iSHOPPER.COM, INC.
(Formerly Sunwalker Development, Inc.)
State of Other Jurisdiction of Incorporation:
UTAH
Commission File Number: 33-3275-D
IRS Employer Identification Number: 87-0431533
Address and Telephone Number of Principle Executive Offices:
8722 South 300 West
Sandy, UTAH 84070
(801) 984-9300
Item 7. Financial Statements of Acquired Business.
Enclosed are the financial statements of Ecenter, Inc. and
subsidiaries, Ishopper.com, Inc. and Outbound Enterprises, Inc. for
the year ended 1998 and period ended August 31, 1999. Registrant
acquired Ecenter, Inc. and subsidiaries effective October 4, 1999.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
iShopper.com, Inc.
Date: February 22, 2000
ECENTER, INC.
Consolidated Financial Statements
August 31, 1999 and December 31, 1998
To the Board of Directors and Stockholders
of ECenter, Inc.
We have audited the accompanying consolidated balance sheets of ECenter, Inc.
(a Utah corporation) as of August 31, 1999 and December 31, 1998 and the
related consolidated statements of operations, stockholders' equity and cash
flows for the periods then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about 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 financial statements.
An audit also included assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of ECenter,
Inc. as of August 31, 1999 and December 31, 1998 and the results of its
operations and cash flows for the periods then ended in conformity with
generally accepted accounting principles.
Salt Lake City, Utah
November 19, 1999
ECENTER, INC.
Consolidated Balance Sheets
ASSETS
August 31, December 31,
1999 1998
Current Assets
Cash $ 117,668 $ 20,468
Accounts Receivable trade
(Net of allowance for doubtful
accounts of $180,368 and $26,555,
respectively) 433,779 28,875
Employee receivables 3,807 547
Prepaid expense 45,706 12,057
Total Current Assets 600,960 61,947
Property & Equipment, Net (Note 2) 67,980 20,751
Other Assets
Goodwill, net (Note 1) 219,221 -
Deposits (Note 7) 95,172 11,131
Total Other Assets 314,393 11,131
TOTAL ASSETS $ 983,333 $ 93,829
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable - trade $ 312,986 $ 75,221
Accrued expenses 68,079 14,721
Notes payable (Note 3) 150,000 -
Note payable - related party (Note 4) 340,000 25,000
Total Liabilities 871,065 114,942
Stockholders' Equity (Deficit)
Common stock, no par value; 25,000,000
shares authorized; 5,000,000 and 2,000,000
shares issued and outstanding, respectively 254,500 126,500
Less: Subscriptions receivable (3,000) -
Retained Deficit (139,232) (147,613)
Total Stockholders' Equity (Deficit) 112,268 (21,113)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY(DEFICIT) $ 983,333 93,829
ECENTER, INC.
Consolidated Statements of Operations
For the Eight For the Year
Months Ended Ended
August 31, December 31,
1999 1998
REVENUES $3,151,693 $414,740
COST OF SALES 210,665 18,571
GROSS PROFIT 2,941,028 396,169
OPERATING EXPENSES
General & Administrative 2,564,608 485,889
Bad Debt Expense 372,398 59,720
NET OPERATING INCOME (LOSS) 4,022 (149,440)
OTHER INCOME (EXPENSE):
Interest Income 20,402 1,827
Interest Expense (542) -
TOTAL OTHER INCOME (EXPENSES) 19,860 1,827
NET INCOME (LOSS) BEFORE TAXES 23,882 (147,613)
INCOME TAXES (Note 1) - -
NET INCOME BEFORE EXTRAORDINARY LOSS: 23,882 (147,613)
EXTRAORDINARY ITEMS:
Loss on casualty (Net of Income Tax of $0) (Note 6) (15,500) -
NET INCOME (LOSS) $8,382 $(147,613)
EARNINGS PER SHARE
Basic:
Net Income loss before extraordinary
items $ .01 $ (.0)
Extraordinary items (.01) -
INCOME (LOSS) PER SHARE $- $(.07 )
WEIGHTED AVERAGE SHARES OUTSTANDING 2,750,000 2,000,000
ECENTER, INC.
Consolidated Statements of Stockholders' Equity
August 31, 1999 and December 31, 1998
Common Stock Retained
Shares Amount Earnings
Balance - $ - $ -
Shares issued to organizers
for cash 2,000,000 126,500 -
Net (loss) for the year ended
December 31, 1998 - - (147,613)
Balance -December 31, 1998 2,000,000 126,500 (147,613)
Reorganization of Company - Reverse
acquisition of E-Center, Inc.
(Note 3) 3,000,000 254,500 -
Net income for the eight months ended August 31, 1999
- - 8,382
Balance -August 31, 1999 5,000,000 $ 254,500 $ (139,232)
ECENTER, INC.
Consolidated Statements of Cash Flows
For the Eight
Months For the Year
Ended Ended
August 31, December 31,
1999 1998
Cash Flows From Operating Activities
Net (loss) Profit $ 8,382 $ (147,613)
Less non-cash items:
Amortization & Depreciation Expense 15,631 1,206
Bad Debt Expense 192,030 26,555
(Increase) decrease in accounts receivable
(553,577) (55,977)
(Increase) decrease in prepaid expenses
(30,993) (12,057)
Increase (decrease) in accounts payable
224,816 75,221
Increase (decrease) in accrued expenses
53,358 14,721
Net Cash Provided (Used) by
Operating Activities (90,353) (97,944)
Cash Flows from Investing Activities
Purchase of Equipment (86,898) (21,957)
Cash paid for deposits (84,041) (11,131)
Cash deficiency of Acquired Subsidiary
(5,508) -
Purchase of Goodwill (226,000) -
Net Cash Provided (Used) by
Investing Activities (402,447) (33,088)
Cash Flows from Financing Activities
Cash from stock issuances 125,000 126,500
Cash from debt financing (Net) 465,000 25,000
Net Cash Provided (Used) by
Financing Activities 590,000 151,500
Increase in Cash 97,200 20,468
Cash and Cash Equivalents at
Beginning of Period 20,468 -
Cash and Cash Equivalents at
End of Period $ 117,668 $ 20,468
Supplemental Non-Cash Financing Transactions:
Cash paid for:
Interest $ 542 $ -
Income taxes $ - $ -
ECENTER, INC.
Notes to the Financial Statements
August 31, 1999 and December 31, 1998
NOTE 1 - Summary Of Significant
Accounting Policies
a. Organization
ECenter, Inc. (the Company) is a consolidated group of corporations
with two companies as wholly owned subsidiaries, Outbound Enterprises, Inc.
and iShopper Internet Services, Inc.
ECenter, Inc. (ECenter) was incorporated on April 28, 1999 in the
State of Utah and is in the business as a holding corporation for its wholly
owned subsidiaries.
iShopper Internet Services, Inc (iShopper) was incorporated on August
6, 1996 in the State of Utah and is in the business of creating and maintaining
internet web sites.
Outbound Enterprises Inc. (Outbound) was incorporated on July 27, 1998
in the State of Utah and is in the business of marketing the services iShopper
provides.
The shareholders of Outbound acquired control of ECenter in July, 1999
through a reverse merger acquisition of ECenter. The acquisition is accounted
for similar to a "pooling of interest" method of accounting where the history
of Outbound is shown from inception (1998).
iShopper was acquired on July 1, 1999. All of the stock of iShopper
was acquired for a down payment of $76,000 and a note of $150,000 with payments
of $30,000 per month. The acquisition of iShopper was accounted for as a
purchase with net assets of iShopper being $(780) at purchase, resulting in
goodwill value of $226,780. iShopper's business activity is shown since
acquisition on July 1, 1999.
Ecenter activity is shown since inception (April 28, 1999).
NOTE 1 - Summary Of Significant Accounting Policies (Continued)
b. Recognition of Revenue
The Company's subsidiaries, Outbound and iShopper, are in the business
of putting on seminars to the general public to advertise its expertise in
creating, maintaining and promoting individual E-Commerce sites for potential
new businesses.
The seminars are used to educate the public in the general business of
internet sites and promotes its services for further development of individual
sites for interested new businesses. The Company offers a range of services
from individual design to complete maintenance and publicity of internet
sites. Customers select what services that which to have provided and pay
either cash, third party financing arranged through the Company, or in-house
financing. When the Company uses financing through a third party, a discount
and processing fees are charged and are netted against gross sales. The
Company is also charged a reserve account for possible bad debt accounts.
(See Note 7).
c. Earnings (Loss) Per Share
The computation of earnings per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.
d. Cash and Cash Equivalents
The company considers all highly liquid investments with maturities of
three months or less to be cash equivalents.
e. Provision for Income Taxes
No provision for income taxes have been recorded due to net operating
loss carryforwards totalling approximately $147,000 that will be offset
against future taxable income. These NOL carryforwards will begin to expire
in the year 2016.
No tax benefit has been reported in the financial statements until the year end
taxable income has been computed and an estimate of future net income estimated.
NOTE 1 - Summary Of Significant Accounting Policies (Continued)
e. Provision for Income Taxes (continued)
Estimated Deferred tax asset and the valuation account is as follows:
December 31,
1998
Deferred tax asset:
NOL carryforward $ 48,000
Valuation allowance (48,000)
$ -
ECENTER, INC.
Notes to the Financial Statements
August 31, 1999 and December 31, 1998
f. Goodwill
Goodwill is a result of the purchase of iShopper Internet Services,
Inc. and is being amortized on the straight line basis over a five year
period. Amortization expense charged to operations for 1999 was $7,559.
g. Principles of Consolidation
These financial statements include the books of ECenter, Inc and its
wholly owned subsidiaries, Outbound and iShopper. All intercompany
transactions and balances have been eliminated in the consolidation.
h. Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities, disclosure
of contingent assets and liabilities at the date of the financial statements
and expenses during the reporting period. In these financial statements,
assets, liabilities and expenses involve extensive reliance on
management's estimates. Actual results could differ from those estimates.
NOTE 2 - Property and Equipment
The Company capitalizes purchases of long lived assets that are
expected to give benefit to the Company over the life of the asset. The
Company also capitalizes improvements and costs that increases the value of
or extend the life of the asset.
Capitalized assets are depreciated over the estimated useful lives of
the assets (five to seven years for furniture and fixtures, 3 years for
computer equipment) on the straight line basis.
NOTE 2 - Property and Equipment (continued)
Property and equipment consists of the following at August 31, 1999 and
December 31, 1998:
August 31, December 31,
1999 1998
Furniture & Fixtures $ 13,673 $ 3,410
Computer Equipment 95,183 18,547
108,856 21,957
Less: Accumulated
Depreciation (40,876) (1,206)
Total Property & Equipment $ 67,980 $ 20,751
At the time of acquisition, June 30, iShopper had property and
equipment as follows:
Furniture & Fixtures $ 38,103
Accumulated Depreciation (33,008)
Net Assets $ 5,095
Depreciation expense for the period ended August 31, 1999 and December
31, 1998 is $8,072 and $1,206, respectively.
NOTE 3 - Note Payable
In July, the Company purchased iShopper Internet Services, Inc. for
$226,000. The Company paid $76,000 cash and agreed to pay the remaining
$150,000 in monthly installments of $30,000 beginning September 1999. The
balance is non-interest bearing.
NOTE 4 - Note Payable - Related Party
During 1998 the Company received $25,000 from an officer/director.
The note was repaid in 1999.
During 1999, the Company received $340,000 from shareholders in
anticipation of a merger. The notes were converted into equity in November,
1999 when the merger candidate was found (Note 5).
NOTE 5 - Subsequent Events
In October, 1999, the Company completed a reverse merger through a
public shell, Sunwalker Development, Inc., which later changed its name to
iShopper.com, Inc. As part of this acquisition, several shareholders loaned
ECenter, Inc. $340,000 and was later converted into Sunwalker shares.
Just before the acquisition of Sunwalker, Sunwalker management offered
260,000 stock options to selected shareholders of ECenter, Inc. and other
consultants for $.01 per share. These options were exercised after the
acquisition of Sunwalker and before the end of the year.
NOTE 6 - Extraordinary Loss
During 1999, the Company advanced funds for renovation on the
anticipated acquisition of a building in Salt Lake City. During the
construction phase, a tornado destroyed the building and was written off as a
complete loss. The loss is presented as an extraordinary loss in the
statement of operations.
NOTE 7 - Factored Accounts Receivable
During 1999, the Company used two different accounts receivable
factoring and servicing companies to assist in the financing and collection
of its accounts receivable.
During 1999 (eight months), the Company sold $490,403 of its accounts
receivable to a third party, which charged the Company a discount of $58,519
and established a reserve account for potential future uncollectibles. The
balance of the reserve account at August 31, 1999 was $90,322. The other
company was used as a servicing agency to bill and collect the Company's own
accounts receivable and charged the Company 44,487 in service fees.
