BEEPER PLUS
ANNUAL REPORT
Year Ended June 30, 1997
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
For the fiscal year ended June 30, 1997
Commission File Number: 33-5516-LA
Beeper Plus, Inc.
- ------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 88-0219239
- ------------------------ ------------------------------------
(State of Incorporation) (IRS Employer Identification Number)
3900 Paradise Road, Ste 201 Las Vegas, NV 89109
- -----------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (702) 737-5560
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports re-
quired 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 reg-
istrant 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, 1997, 4,288,000 shares of Common Stock of Beeper Plus, Inc. were
outstanding. The aggregate market value of the common stock held by persons
other than officers and directors of the Registrant and holders of more than
10% of the Registrant's common stock was approximately $123,883. (Based upon
the average of the opening bid and low asked prices of these shares).
- 1 -
<PAGE>
PART I
ITEM 1. BUSINESS
- -----------------
A. General Development of the Business
- --------------------------------------
Beeper Plus, Inc. (the "Company") was incorporated under the laws of the State
of Nevada on March 25, 1986. On March 31, 1986, the Company entered into a
Plan and Agreement of Merger with Dial-a-Score, Inc. (Dial), a Nevada Corpor-
ation, to acquire all of its assets and outstanding shares of Common Stock from
its sole shareholder.
The Company disseminates sports information utilizing contracted paging services
directly to customers nationwide, including Hawaii, Alaska and the Caribbean,
through a hand-held alpha-numeric pager called The Sports Page. The Company
also utilizes independent distributors to provide The Sports Page to clients in
four locations throughout the United States. The distribtors in each territory
enter into Distribution Agreements which provide that a percentage or minimum
as per their contract of gross revenues earned by the distributor is paid to the
Company. Also pursuant to the Agreement, the distributor is typically required
to pay the Company a minimum monthly fee, thus ensuring a minimum monthly
revenue for the Company.
B. Financial Information About Industry Segment
- -----------------------------------------------
The Company operates in mainly one industry segment, involving the dissemination
of computer data sports information. However, the Company has introduced
another product to the industry known as "The Front Page" which involves the
dissemination of computer data news information.
C. Narrative Description of Businesses
- --------------------------------------
The Company has been marketing its sports information service nationwide, in-
cluding Hawaii, Alaska and the Caribbean. To date the Company has continued to
enter into additional markets without utilizing distributors. The Company
maintains four existing distributorship contracts in Hawaii, Northern Califor-
nia, Florida and New England.
The Company, through its contracted paging services throughout the country, com-
municates sports information to customers through a hand-held battery operated
alpha-numeric pager called The Sports Page. The Company has terminated distrib-
utorships in Chicago, Dallas and Maryland, and has started to service these
territories directly through contracted paging services.
The Sports Page displays a variety of sports data on a four-line LCD screen.
Three different wire services feed information to The Sports Page through a
series of satellite transmissions that originate at a particular sporting event
and are sent to a home-base computer and uplink facility in Las Vegas. From
Las Vegas, signals are sent through satellite to transmitters positioned in
cities around the contry. These local transmitters then relay UHF, VHF and 900
MHz signals to The Sports Page, within a 30 to 150 mile radius of their loca-
tion. The Sports Page displays information about sporting events on its LCD
screen, including partial and final scores, game schedules, pitching changes,
injuries and weather conditions and can also be utilized as a personal pager.
- 2 -
<PAGE>
The information displayed on The Sports Page is updated as often as every three
minutes. The three wire services used by the Company are "The Sports Network"
(TSN), "The Sports Wire", and Don Best. The arrangements are not exclusive and
the wire services have other customers. The Company is not reuqired to maintain
paging licenses. Such licenses to provide personal paging services are held by
paging companies that have contracts to provide paging services on behalf of the
Company (the Company acts as a reseller of personal paging services). The
pagers used by the customers are sold by the Company.
The Company intends to continue expansion into other information markets at such
time as the demand arises. The Company will be using the same methods of trans-
mitting information.
On March 23, 1992, the Company signed a joint venture agreement with NDC
"National Dispatch Center" located in San Diego, California. Beeper Plus, Inc.
and NDC together shall sell and promote the Front Page product. The product
name has been changed to "News-Master/Front Page". In February 1993, the
Company entered into a contract with National Dispatch Center (NDC) such that
NDC will conduct all the monthly billing for all Front Page Subscribers. Beeper
Plus, Inc. will maintain and enhance the product and continue in sales and mar-
keting. The types of news provided in the "The Front Page" service include
headline and top story updates, weather forecasts, daily business reports, daily
sporting event results and television listings and weekly entertainment head-
lines and listings. The information sources utilized by the "The Front Page"
service include various wire services such as U.P.I. and T.S.N. Information up-
dates are provided in excess of fifty times a day. During times of emergency,
such as the 1989 San Francisco earthquake and Hurricane Andrew's assault on
Florida, the Front Page has proven to be an invaluable tool in providing
critical local news to residents without power.
Accessing the Sports Information
--------------------------------
Access to the Company's sports information is designed with an eye towards con-
venience. The Sports Page provides immediate sports information and updated
weather and racing results. For instance, during the professional and college
football season, the scores of every professional game and the most actively
watched college football games are displayed on the pager throughout the course
of the event.
The Sports Page alerts the customer when a new score is received by displaying
a message of the most current score and team names of the combatants. Upon
being alerted by the pager, the customer presses a button on the pager and the
desired team name and score is displayed. This same process is utilized to
alert the customer to injuries, weather conditions, racing results, hockey
results, short stories related to sports events, statistics, probable pitchers
for baseball, results of boxing matches and other sports news.
- 3 -
<PAGE>
Market and Marketing
--------------------
Currently the Company has no intention to engage any distributor for any new
territory. The Company has been and will be marketing its products directly.
The Company will continue to rely on current distributors and their ability to
successfully market The Sports Page product in their territories. The Sports
Page has received national recognition in newspapers and magazines throughout
the country.
New Products
------------
The Company is continuing to research new products and improve existing
products.
Competition
-----------
The dissemination of sports information is a competitive industry. There are a
number of entities which could be considered direct or indirect competition with
the company in disseminating sports information. The Company, at this time, has
identified several other companies in direct competition which disseminate
sports information by virtue of a hand-held pager, one of which is a former
terminated distributor of the New York, New Jersey, and Philadelphia territory.
Indirect competition comes from cable television sports channels, commercial
television sports new programs, sports information periodicals, the sports sec-
tion of newspapers, radio, direct dial "900" score lines and online computer
services.
Management
----------
An annual meeting of shareholders was held on March 28, 1997 in Las Vegas,
Nevada. The following persons were elected as Directors of the Company until
the next annual meeting of stockholders and until their successors are duly
elected and qualified: Basil B. Newton, May C. Newton and Kevin L. Persinger.
Basil B. Newton is President and Chairman of the Board and May C. Newton is Vice
President of Operations, Secretary/Treasurer and Chief Financial Officer. As of
June 30, 1997, the Company has seventeen technical, administrative and clerical
personnel.
D. Financial Information About Foreign and Domestic Operations and Export Sales.
- --------------------------------------------------------------------------------
The Company has no foreign operations or export sales. The Company's operations
are within the United States, primarily in the State of Nevada. The financial
information regarding its domestic operations in the United States is contained
in the Financial Statements included in this report.
- 4 -
<PAGE>
ITEM 2. PROPERTIES
- -------------------
The Company owns no real property. The Company does not own or lease any paging
transmitters. The Company has arrangements with the paging companies which pro-
vide for priority transmission rights. The Company, as of March 1, 1989, moved
all of its facilities to one office space area located at 3900 Paradise Road,
Suite 201, Las Vegas, Nevada. The office space is leased from a non-affiliated
lessor and is approximately 2,400 square feet. The term of the lease is 36
months beginning January 1, 1997 and ending December 31, 1999. The base minimum
monthly rent for the term of this lease is $4,296 per month for January 1, 1997
to December 31, 1997. The rental rate is increased each January thereafter in
accordance with the consumer price index.
ITEM 3. LEGAL PROCEEDINGS
- --------------------------
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ------------------------------------------------------------
An annual meeting of shareholders was held on March 28, 1997 in Las Vegas,
Nevada. The following matters were submitted to a vote of security holders:
Joseph F. Zerga, Ltd. was appointed as auditor for the fiscal year ended June
30, 1997. The following persons were elected as Directors of the Company until
the next annual meeting of stockholders and until their successors are duly
elected and qualified:
Basil B. Newton
May C. Newton
Kevin L. Persinger
The stockholders have approved the acquisition of additional technologies and/or
companies and allowed the Board of Directors and Officers of the Company to
raise additional capital.
- 5 -
<PAGE>
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
- --------------------------------------------------------------------------------
MATTERS
-------
The Company's Common Stock, par value $.01, is currently listed on the Bulletin
Board. The Company's registration statement was declared effective by the
Securities and Exchange Commission on June 20, 1986. As of its fiscal year
end, June 30, 1997, there were no trades through the National Association of
Securities Dealers. The Bulletin Board does not constitute an established
public market as described in item 201(a)(1) of Regulation S-K.
The market price information for the common equity pursuant to Item 201(a)(i)
(iii) for each quarter from January 1, 1995, through June 30, 1997, was as
follows:
Bid Prices Asked Price
High Low High Low
---- --- ---- ---
1995 First Quarter $ .070 .004 .080 .060
Second Quarter $ .040 .004 .060 .060
Third Quarter $ .040 .001 .060 .020
Fourth Quarter $ .020 .001 .080 .020
1996 First Quarter $ .030 .020 .080 .080
Second Quarter $ .040 .010 .080 .080
Third Quarter $ .040 .040 .095 .080
Fourth Quarter $ .050 .040 .095 .080
1997 First Quarter $ .050 .050 .095 .080
Second Quarter $ .050 .050 .095 .095
The above bid and asked quotations represent prices between dealers and do not
include retail markup, markdown or commission. They do not represent actual
transactions and have not been adjusted for stock dividends or splits.
No dividends have been declared with respect to the Common Stock since the
Company's inception, and the Company does not anticipate paying dividends in the
foreseeable future. However, there are no restrictions on the ability of the
Company to declare dividends on its common stock.
On June 30, 1997, the approximate number of holders of record of the Company's
$.01 par value Common Stock was 266.
- 6 -
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
--------------------------------
<TABLE>
Year Ended June 30
<CAPTION>
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net sales -
Operating
Revenue $1,024,509 $1,150,270 $1,335,881 $1,341,292 $1,403,189
Net Income (Loss) ( 29,340) 52,887 35,425 232,095 138,643
Net Income (Loss)
Per Common Share
Outstanding ( .01) .01 .01 .06 .03
Balance Sheet Data
- ------------------
Working Capital
(Deficiency) 207,569 220,249 149,678 36,510 ( 100,757)
Total Assets 475,489 430,699 397,819 556,203 453,263
Total Liabilities 130,042 56,287 68,073 262,068 391,283
Stockholders'
Equity 345,447 374,412 329,746 294,135 61,980
Long Term Debt - 0 - - 0 - - 0 - - 0 - 86,496
</TABLE>
The Company has not paid any dividends on its stock.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
- ----------------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
Liquidity and Capital Reserves
------------------------------
As of June 30, 1997, the Company has working capital of $207,569 compared to
$220,249 in fiscal year ended June 30, 1996. Operating activities provided
$144,609 of cash flow, which was used in part to repay $10,000 of related party
loans and purchase $14,199 of furniture and equipment. Net cash increased by
$120,410 during the year.
Management anticipates that its operations should generate sufficient income to
cover operating expenses and debt service in future periods. The Company has no
lines of credit or other financing arrangmeent in place and at the present time
has no plans to offer additional Common Stock for sale in any public or private
offering.
- 7 -
<PAGE>
Results of Operations
---------------------
Fiscal Year Ended June 30, 1997 Compared to
-------------------------------------------
Fiscal Year Ended June 30, 1996
-------------------------------
During the fiscal year ended June 30, 1997, revenues were $1,024,509 as compared
to $1,150,270 for the fiscal year ended June 30, 1996, representing a decline
in revenue of $125,761 in fiscal 1997. The Company's statement of operations
for the fiscal year ended June 30, 1997, reflects a net loss of $29,340,
compared to net income of $52,887 in fiscal 1996. Bad debts in the amount of
$69,523 for accounts for which collection is deemed to be doubtful were recog-
nized in the year ended June 30, 1997.
Fiscal Year Ended June 30, 1996 Compared to
-------------------------------------------
Fiscal Year Ended June 30, 1995
-------------------------------
During the fiscal year ended June 30, 1996, revenues were $1,150,270 as compared
to $1,335,881 for the fiscal year ended June 30, 1995, representing a decline
in revenue of $185,611 in fiscal 1996. Despite this decline in revenue, the
Company's 1996 statement of operations reflects net income of $52,887, an
increase of $17,462 from fiscal 1995.
Fiscal Year Ended June 30, 1995 Compared to
-------------------------------------------
Fiscal Year Ended June 30, 1994
-------------------------------
During the fiscal year ended June 30, 1995, revenues were $1,335,881 as compared
to $1,341,292 for the fiscal year ended June 30, 1994. This $5,411 decrease in
revenues was primarily attributable to a reduction in revenues generated by
Front Page sales. The revenues generated from the customer monthly services
increased in fiscal 1995. As a result, the Company's statement of operations
for the year ended June 30, 1995 reflects net income of $35,425.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- ----------------------------------------------------
Financial Statements and Supplementary Data are listed in Part IV, Item 14 of
this Annual Report Form 10-K.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
- -------------------------------------------------------------
No disagreements with Accountants for the year ended June 30, 1997.
- 8 -
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- ------------------------------------------------------------
The following table sets forth certain information regarding each director and
executive officer of the Company:
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
Basil B. Newton 74 President, Chairman of the Board and Director.
May C. Newton 72 Vice President of Operations, Director, Chief
Financial Officer, and Secretary/Treasurer.
Kevin Persinger 31 Director, Computer Programmer.
</TABLE>
The Directors of the Company are elected to hold office until the next annual
meeting of shareholders and until their respective successors are duly elected
and qualified. Officers of the Company serve at the discretion of the Board of
Directors and are appointed by the Board of Directors. Basil Newton and May
Newton are husband and wife.
Basil B. Newton was president/part owner of various casinos in London, England
and St. Maarten Island in the Caribbean. Mr. Newton developed the idea of
disseminating major league sports results through alpha-numeric paging systems
and established Beeper Plus, Inc. to undertake such a venture. Mr. Newton was
appointed Vice-President by the Board of Directors on April 15, 1988, and was
elected Presidnet of Beeper Plus, Inc. on October 5, 1992.
May C. Newton had prior banking experience before joining Beeper Plus, Inc. at
its inception. Mrs. Newton held the position of Vice-President of Operations
and is also a Director of the Company. Mrs. Newton holds the position as Chief
Financial Officer and Secretary/Treasurer of the Company.
Kevin Persinger was elected as Director of the Company on March 10, 1995. Kevin
Persinger joined the Company on September 18, 1990 as Computer Operator and was
promoted to Computer Programmer. He holds an associate degreein Business In-
formation Systems.
- 9 -
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
- --------------------------------
The following table sets forth the total compensation paid by the Company for
its fiscal year ending June 30, 1997, to each of the executive officers of the
Company. During the fiscal years ending June 30, 1995, 1996, and 1997, no
Officer or Director of the Company received cash remuneration in excess of
$60,000. There are no standard arrangements for the compensation of directors.
<TABLE>
<CAPTION>
Capacity Cash
Name Served Compensation
- ---- ------ ------------
<S> <C> <C> <C> <C>
1997 1996 1995
---- ---- ----
Basil Newton President, Chairman
of Board of Directors $37,721 $36,753 $40,875
May Newton Secretary/Treasurer, 13,471 13,255 11,800
Director, Chief Financial
Officer, Vice President
of Operations
Nancy Troy (i) Chief Financial Officer -0- -0- 4,012
Secretary/Treasurer, Director
Kevin Persinger Director 32,522 31,355 28,750
All Officers and Directors as a group $83,714 $81,363 $85,437
======= ======= =======
</TABLE>
(i) Nancy Troy resigned as Chief Financial Officer, Secretary/Treasurer
and Director as of July 29, 1994.
No retirement, pension, profit sharing or similar program has been adopted by
the Company. No warrants or options are currently outstanding and none have
been granted to any Officer, Director or other employee of the Company. The
Company may offer stock bonuses, stock options, profit sharing or pension plans
to key employees or executive officers of the Company in such amounts and upon
such conditions as the Board of Directors may in its sole discretion determine.
- 10 -
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- ------------------------------------------------------------------------
A. Security Ownership of Certain Beneficial Owners
- ---------------------------------------------------
The persons set forth on the chart below are known to the Company to be the
beneficial owners of more than 5% of the Company's outstanding Common Stock:
<TABLE>
<CAPTION> Number of Percentage
Name/Address Shares Owned Owned
- ------------ ----------- ----------
<S> <C> <C>
Cede & Company (*) 699,256 16.31%
P.O. Box 20
Bowling Green Station
New York, NY 10004
May C. Newton 631,413 14.73%
47 Princeville Lane
Las Vegas, NV 89113
Basil B. Newton 881,600 20.56%
47 Princeville Lane
Las Vegas, NV 89113
Samuel A. Francis 362,500 8.45%
2610 San Mateo NE, #A
Albuquerque, NM 87110
* CEDE & Company is a nominee for Depository Trust Company. The Company has
been unable to determine how many shareholders this represents.
</TABLE>
B. Security Ownership of Management
- ------------------------------------
Information concerning the number and percentage of shares of the Company's
outstanding Common Stock beneficially owned by Officers and Directors is set
forth on the chart below.
<TABLE>
<CAPTION>
Number of Percentage
Name Shares Owned Owned
- --------- ------------ ----------
<S> <C> <C>
Basil B. Newton 881,600 20.60%
May C. Newton 631,413 14.75%
Kevin Persinger 2,000 0.05%
---------- ------
All Officers & Directors as a Group 1,515,013 34.40%
========== ======
</TABLE>
- 11 -
<PAGE>]
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- --------------------------------------------------------
At June 30, 1997, the Company owed one shareholder a total of $26,000, $10,000
was repaid during the year ended June 30, 1997. This loan has been classfied as
a current liability, as no specific due dates have been determined. This loan
does not provide for interest payment and its terms are as favorable to the
Company as those which could have been obtained from a third party in an arm's
length transaction.
IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K
- ---------------------------------------------------------------------------
Documents filed as part of this report:
- --------------------------------------
Page No.
--------
1. Financial Statements
Independent Auditors' Report -
June 30, 1997 and 1996 16
Balance Sheets -
June 30, 1997 and 1996 17
Statements of Operations - Years Ended
June 30, 1997, 1996 and 1995 18-19
Statements of Shareholders' Equity
Years Ended June 30, 1997 and 1996 20
Statements of Cash Flows - Years Ended
June 30, 1997 and 1996 21
Summary of Significant Accounting Policies
and Notes to Financial Statements 22-26
Page No.
--------
2. Financial Statement Schedules
Independent Auditors' Report on Financial
Statement Schedules - June 30, 1997 and 1996 S-1
Schedule I - Property, Plant and Equipment S-2
Schedule II - Accumulated Depreciation and
Amortization of Property, Plant and Equipment S-3
Schedules other than those listed above are omitted for the reason that they are
not required or are not applicable, or the required informaiton is shown in the
financial statements or notes thereto. Columns omitted from the schedules filed
have been omitted because the information is not applicable.
- 12 -
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its be-
half by the undersigned, thereunto duly authorized.
Beeper Plus, Inc.
-----------------
(Registrant)
09/18/97 Basil B. Newton
Dated: -------------------- By ------------------------------
Basil B. Newton
President and Chairman
of the Board
Pursuant to the requirements of the Securities Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
09/18/97 Basil B. Newton
Dated: -------------------- By ------------------------------
Basil B. Newton
President and Chairman
of the Board
09/18/97 May C. Newton
Dated: ------------------- By -----------------------------
May C. Newton
Secretary/Treasurer
Chief Financial Officer
Director
- 13 -
<PAGE>
Financial Statements
of
Beeper Plus, Inc.
Years Ended June 30, 1997, 1996 and 1995
- 14 -
<PAGE>
Beeper Plus, Inc.
Years Ended June 30, 1997, 1996 and 1995
TABLE OF CONTENTS
Page #
------
Independent Auditor's Report 16
Financial Statements:
Balance Sheet 17
Statements of Operations 18-19
Statements of Shareholders' Equity 20
Statements of Cash Flows 21
Summary of Significant Accounting Policies
And Notes to Financial Statements 22-26
Independent Auditors' Report on Financial
Statement Schedules S-1
Schedule I - Property, Plant and Equipment S-2
Schedule II - Accumulated Depreciation and S-3
Amortization of Property, Plant
and Equipment
- 15 -
<PAGE>
Joseph F. Zerga, Ltd.
2950 E Flamingo Rd, Ste L
Las Vegas, NV 89121
(702) 732-2775
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Board of Directors
Beeper Plus, Inc.
Las Vegas, Nevada
We have audited the accompanying balance sheets of Beeper lus, Inc. as of
June 30, 1997 and 1996 and the related statements of operations, shareholders'
equity and cash flows for each of the years in the three-year period ended
June 30, 1997. 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 stand-
ards. Those standards require that we plan and perform the audit 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 includes
assessing the accounting principles used and significant estimates made by man-
agement, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Beeper Plus, Inc. as of June
30, 1997 and 1996 and the results of operations and its cash flows for each of
the years in the three-year period ended June 30, 1997, in conformity with gen-
erally accepted accounting principles.
Las Vegas, Nevada
September 16, 1997
- 16 -
<PAGE>
Beeper Plus, Inc.
Balance Sheet
June 30, 1997 and 1996
<TABLE>
ASSETS
<CAPTION> 1997 1996
---- ----
<S> <C> <C>
Current Assets:
Cash $255,621 $135,211
Accounts Receivable (Net of
allowance for doubtful accounts
of $88,969 & $34,211 for 1997
and 1996) 55,734 130,827
Inventories 14,705 26,315
Prepaid Expenses 11,551 8,615
-------- --------
Total Current Assets 337,611 300,968
-------- --------
Furniture, Fixtures & Equipment, net
of Depreciation (Note 1) 26,353 40,838
--------- --------
Other Assets:
Deferred Tax Assets (Note 6) 100,525 100,525
Distributorship, net (Note 2) 11,000 12,800
-------- --------
Total Other Assets 111,525 113,325
-------- --------
TOTAL ASSETS $475,489 $455,131
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable, Trade $ 1,057 $ 8,957
Deferred Service Revenue 87,546 24,432
Deferred Distributorship Revenue 1,650 5,810
Other Accrued Expenses 13,789 5,520
Loans from Related Parties (Note 3) 26,000 36,000
-------- --------
Total Current Liabilities 130,042 80,719
-------- --------
Long-term Debt (Note 4) -0- -0-
-------- --------
Stockholders' Equity:
Common stock, par value $.01 per share;
authorized 10,000,000 shares; issued
and oustanding 4,285,500 42,880 42,805
Additional Paid-In Capital 948,950 948,650
Accumulated Deficit (646,383) (617,043)
-------- --------
Total Stockholders' Equity 345,447 374,412
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $475,489 $455,131
======== ========
<FN>
The accompanying summary of Significant Accounting Policies and Notes
are an integral part of these financial statements.
- 17 -
</TABLE>
<PAGE>
Beeper Plus, Inc.
Statement of Operations
For the Years Ended June 30, 1997, 1996, and 1995
<TABLE>
<CAPTION>
1997 1996 1995
---- ---- ----
<C> <C> <C>
REVENUE:
<S>
Monthly Distributorship Revenue $ 197,860 $ 309,522 $ 397,080
Monthly Service Revenue 616,713 605,233 685,956
Pager Sales 53,282 59,499 83,462
Phone Card Sales -0- 23,859 34,972
Front Page Sales 143,192 128,864 132,213
Other Revenue 13,462 23,293 2,198
---------- ---------- ----------
TOTAL REVENUE 1,024,509 1,150,270 1,335,881
---------- ---------- ----------
OPERATING COSTS AND EXPENSES:
Cost of Sales 335,636 449,700 505,306
Advertising and Promotion 9,080 6,436 11,647
Amortization 1,800 2,200 46,131
Bad Debts 69,523 165 57,710
Depreciation 17,247 27,484 29,994
Entertainment 2,092 618 1,239
Insurance 31,013 29,247 23,013
Professional Fees 12,050 11,633 10,481
Maintenance and Repairs 11,221 18,505 18,916
Office Supplies and Expense 11,966 26,270 14,245
Salaries and Wages 342,693 309,263 347,265
Postage and Shipping 21,991 24,398 21,105
Printing 5,378 4,599 4,219
Office Rent 53,170 53,230 47,078
Payroll Taxes and Other Benefits 40,274 33,934 38,348
Taxes and Licenses 2,534 4,828 3,439
Telephone 17,494 19,345 18,722
Utilities 4,367 4,832 4,639
Front Page & Phone Card Expense 983 18,016 25,045
Legal and Accounting 26,639 24,656 36,197
Miscellaneous 41,742 30,029 32,424
---------- ---------- ----------
TOTAL OPERATING COSTS
AND EXPENSES $1,058,893 $1,099,388 $1,297,163
---------- ---------- ----------
<FN>
The accompanying summary of Significant Accounting Policies and Notes are an
integral part of these financial statements.
- 18 -
</TABLE>
<PAGE>
Beeper Plus, Inc.
Statement of Operations (Continued)
For the Years Ended June 30, 1997, 1996, and 1995
<TABLE>
<CAPTION>
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Operating Income ($ 34,384) $ 50,882 $ 38,718
Other Revenue (Expense):
Interest Income 5,044 2,005 344
Interest Expense -0- -0- ( 3,637)
---------- ---------- ----------
Total 5,044 2,005 3,293
---------- ---------- ----------
Income (Loss) Before Income
Tax (Note 6) ( 29,340) 52,887 35,425
Income Tax - Current -0- ( 8,221) ( 5,314)
---------- ---------- ----------
Net Income ($ 29,340) $ 44,666 $ 30,111
========== ========== ==========
Earnings per share ($ .01) $ .01 $ .01
Weighted Average Number of Common
Shares Outstanding 4,280,911 4,280,500 4,211,184
========== ========== ==========
<FN>
The accompanying summary of Significant Accounting Policies and Notes are an
integral part of these financial statements.
- 19 -
</TABLE>
<PAGE>
Beeper Plus, Inc.
Statement of Shareholders' Equity
For the Years Ended June 30, 1997, 1996 and 1995
<TABLE>
<CAPTION> Add'l
Common Stock Paid-In Accumulated
Shares Amount Capital Deficit Total
------ ------ ------- ------- -----
<S> <C> <C> <C> <C> <C>
Balance
June 30, 1994 4,180,500 41,805 944,150 ( 691,820) 294,135
Issuance of
common stock
to employees
in lieu of
compensation 100,000 1,000 4,500 5,500
Net Income 30,111 30,111
--------- ------ ------- --------- --------
Balance
June 30, 1995 4,280,500 42,805 948,650 ( 661,709) 329,746
Net Income 44,666 44,666
--------- ------ ------- --------- -------
Balance
June 30, 1996 4,280,500 42,805 948,650 ( 617,043) 374,412
Issuance of
common stock
to employees
in lieu of
compensation 7,500 75 300 375
Net Income ( 29,340) ( 29,340)
--------- ------ ------- -------- --------
Balance
June 30, 1997 4,288,000 42,880 948,950 ( 646,383) ( 345,447)
========= ====== ======= ======== ========
<FN>
The accompanying summary of Significant Accounting Policies and Notes are an
integral part of these financial statements.
- 20 -
</TABLE>
<PAGE>
Beeper Plus, Inc.
Statement of Cash Flows
For the Years Ended June 30, 1997, 1996, and 1995
<TABLE>
<CAPTION> 1997 1996 1995
---- ---- ----
<C> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss) ($29,340) $ 44,666 $ 30,111
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation 17,247 27,484 29,994
Amortization 1,800 2,200 46,130
Loss on Disposal of Assets 11,437 -0- -0-
(Increase) Decrease in Deferred Tax -0- 8,221 5,314
Issuance of Stock as Compensation 375 -0- 5,500
(Increase) Decrease in Accts Receivable 75,093 ( 50,122) ( 7,319)
(Increase) Decrease in Inventories 11,610 25,310 142,875
Increase (Decrease) in Accts Payable ( 7,900) ( 7,027) (191,745)
Increase (Decrease) in Deferred Revenue 58,955 ( 6,680) 4,990
Increase (Decrease) in Accrued Expenses 8,268 1,921 ( 7,240)
(Increase) Decrease in Prepaid Expenses ( 2,936) 6,794 ( 15,409)
------- ------- -------
Net cash from operating activities 144,609 52,767 43,201
------- ------- -------
Cash Flows from Investing Activities:
Capital Expenditures ( 14,199) -0- ( 3,881)
Distributorship -0- ( 12,000) -0-
------- ------- ------
Net Cash from Investing Activities ( 14,199) ( 12,000) ( 3,881)
------- ------- ------
Cash Florws From Financing Activities:
Principal payments on loans to
related parties ( 10,000) -0- -0-
------- ------- ------
Net Cash from Financing Activities ( 10,000) -0- -0-
------- ------- ------
Net Increase (Decrease) in Cash 120,410 40,767 39,320
Cash at Beginning of Year 135,211 94,444 55,124
------- ------- -------
Cash at End of Year $255,621 $135,211 $ 94,444
======== ======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest Paid $ -0- $ -0- $ 3,637
======== ======== ========
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Issuance of Common Stock as Partial
Consideration for Compensation $ 375 $ -0- $ 5,500
======== ======== ========
<FN>
The accompanying summary of Significant Accounting Policies and Notes are an
integral part of these financial statements.
- 21 -
</TABLE>
<PAGE>
Beeper Plus, Inc.
Summary of Significant Accounting Policies and
Notes to Financial Statements
For the Years Ended June 30, 1997, 1996, and 1995
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
The Company:
- -----------
Beeper Plus, Inc. (the Company) was incorporated under the laws of the State of
Nevada on March 25, 1986. On March 31, 1986, the Company acquired Dial-A-Score,
Inc. a Nevada corporation which was incorporated on July 5, 1985. Dial-A-Score,
Inc. was a privately held company with one stockholder, who is also a director
of the Company. Because Dial-A-Score was under common control for accounting
purposes, it is considered to be the predecessor of the Company.
The Company is engaged in the business of providing data services through pagers
for all major sporting events.
Inventories:
- ------------
Inventories of pagers are stated at the lower of cost (first-in, first-out
method) or market.
Depreciation:
- ------------
Furniture, fixtures and equipment are stated at cost. Depreciation is computed
by the straight-line method over estimated useful lives of five to seven years.
Maintenance, Repairs and Renewals:
- ---------------------------------
Maintenance, repairs and renewals which neither materially add to the value of
the equipment nor appreciably prolong its life are charged to expense as in-
curred. Gains or losses on dispositions of equipment are included in opera-
tions.
Amortization:
- ------------
The Company amortizes new distributorships purchased over 15 years.
Deferred Distributorship Revenue:
- --------------------------------
Deferred revenue results from receipts of initial fees on distributorship agree-
ments, which normally are for an initial term of one year. Since such agree-
ments are generally renewable at the option of the distributor, the deferred
revenue is recognized ratably over the estimated three year period until the
continuing monthly fees will cover the cost of continuing services and provide a
reasonable profit.
- 22 -
<PAGE>
Beeper Plus, Inc.
Summary of Significant Accounting Policies and
Notes to Financial Statements
For the Years Ended June 30, 1997, 1996, and 1995
Estimates:
- ----------
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of management's estimates.
Earnings per Share:
- ------------------
The computation of earnings per share is based on the weighted average number of
outstanding common shares.
- 23 -
<PAGE>
Beeper Plus, Inc.
Summary of Significant Accounting Policies and
Notes to Financial Statements (Continued)
For the Years Ended June 30 1997, 1996, and 1995
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 1 - Furniture, Fixtures and Equipment:
- ------------------------------------------
Furniture, fixtures and equipment consist of the following:
<TABLE>
<CAPTION>
Service Life
(Years) 1997 1996 1995
----- ---- ---- ----
<S> <C> <C> <C> <C>
Furniture, Fixtures
and Equipment 5 - 7 $271,770 $454,262 $454,262
Leasehold Improvements 5 12,380 12,380 12,380
-------- -------- -------
Total Fixed Assets 284,150 466,642 466,642
Less Accumulated Depreciation (257,797) (425,804) (398,320)
-------- -------- --------
Net Fixed Assets $ 26,353 $ 40,838 $ 68,322
======== ======== ========
</TABLE>
NOTE 2 - Distributorship:
- ------------------------
On April 11, 1996, the Company purchased the Dallas distributorship from Arthur
Stevens for $12,000. The asset was recorded at cost and is amortizable over a
period of fifteen years.
NOTE 3 - Loans from Related Parties:
- -----------------------------------
Loans from related parties include the following:
<TABLE>
<CAPTION> 1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Notes Payable to Shareholders (Jamie
Thompson) Non-Interest Bearing $ 26,000 $ 36,000 $ 36,000
======== ======== ========
</TABLE>
Payment on this note in the amount of $10,000 was made in February of 1997. No
other payments have been made on loans from related parties for the three year
period ended 6/30/97.
NOTE 4 - Long Term Debt:
- -----------------------
The Company had no Long Term Debt obligations during the three year period ended
6/30/97.
- 24 -
<PAGE>
Beeper Plus, Inc.
Summary of Significant Accounting Policies and
Notes to Financial Statements (Continued)
For the Years Ended June 30, 1997, 1996, and 1995
NOTE 5 - Committments and Contingencies
- -----------------------------------------
Operating Leases
----------------
The Company leases office space under a non-cancelable operating lease. (See
Item 2 Form 10-K). Rents are adjusted each January based on the Consumer Price
Index (CPI). Future minimum lease payments (unadjusted for CPI) are as follows:
Year Ending June 30, 1998 $ 51,552
Year Ending June 30, 1999 51.552
Six Months Ending December 31, 1999 25,776
NOTE 6 - Income Taxes
- ---------------------
The Company has net operating loss carryforwards of $674,884, which if not
utilized will expire as follows:
<TABLE>
<CAPTION>
Year Ending For Financial
June 30 Reporting Purposes
------- ------------------
<S> <C> <C>
2003 $ 187,083
2004 308,251
2005 168,871
---------
$ 664,205
=========
</TABLE>
During 1994, the Company adopted FASB Statement 109 on accounting for income
taxes. The components of deferred tax assets are as follows:
Deferred Tax Asset at July 1, 1993 $233,500
Tax Benefit of losses carried forward
for the year ended June 30, 1994 ( 32,380)
Valuation allowance at June 30 1994 ( 87,060)
--------
Deferred Tax Asset at June 30, 1994 114,060
Less Deferred Tax Used as of June 30, 1995 ( 5,314)
--------
Deferred Tax Asset at June 30, 1995 108,746
Less Deferred Tax Used as of June 30, 1996 ( 8,221)
--------
Deferred Tax Asset at June 30, 1996 100,525
Less Deferred Tax Used as of June 30, 1997 -0-
--------
Deferred Tax Asset at June 30, 1997 $100,525
========
- 25 -
<PAGE>
Beeper Plus, Inc.
Summary of Significant Accounting Policies and
Notes to Financial Statements (Continued)
For the Years Ended June 30, 1997, 1996, and 1995
NOTE 7 - Common Stock to Officers/Directors/Employees
- -----------------------------------------------------
Kevin Persinger, Joel Blakemore and David Stevens, all employees of the Company,
each received 2,500 shares of common stock in lieu of compensation in June of
1997.
- 26 -
<PAGE>
Joseph F. Zerga, Ltd.
2950 E Flamingo Rd, Ste L
Las Vegas, NV 89121
(702) 732-2775
INDEPENDENT AUDITORS' REPORT ON
FINANCIAL STATEMENT SCHEDULES
To the Board of Directors
Beeper Plus, Inc.
Las Vegas, Nevada
In connection with our audits of the financial statements of Beeper Plus, Inc.
as of June 30, 1997, 1996 and 1995, we also audited the financial statement
schedules listed under Item 14(a)(2). In our opinion, the financial statement
schedules for the years ended June 30, 1997, 1996 and 1995 present fairly in all
material respects, the information stated therein, when considered in relation
to the financial statements taken as a whole.
Las Vegas, Nevada
September 16, 1997
S-1
<PAGE>
Beeper Plus, Inc.
Schedule 1 - Property, Plant and Equipment
For the Years Ended June 30, 1997, 1996 and 1995
<TABLE>
<CAPTION>
Furniture Fixtures June 30 June 30 June 30
and Equipment 1997 1996 1995
- ------------------ ------- ------- -------
<S> <C> <C> <C>
Balance at Begin-
ning of the Year $ 466,642 $ 466,642 $ 462,761
Additions 14,199 -0- 3,881
Disposals ( 196,691) -0- -0-
--------- --------- ---------
Balance at End
of the Year $ 284,150 $ 466,642 $ 466,642
========= ========= =========
</TABLE>
S-2
<PAGE>
Beeper Plus, Inc.
Schedule II - Accumulated Depreciation and Amortization
of Property, Plant and Equipment
For the Years Ended June 30, 1997, 1996 and 1995
<TABLE>
<CAPTION>
Accumulated June 30 June 30 June 30
Depreciation 1997 1996 1995
- ------------ --------- -------- -------
<S> <C> <C> <C>
Balance at Begin-
ing of the Year $ 425,804 $ 398,320 $ 368,326
Expenses 17,247 27,484 29,994
Disposals ( 185,254) -0- -0-
--------- --------- ---------
Balance at End
of the Year $ 257,797 $ 425,804 $ 398,320
========= ========= =========
</TABLE>
S-3
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> Jun-30-1997
<PERIOD-START> Jul-01-1996
<PERIOD-END> Jun-30-1997
<CASH> 255621
<SECURITIES> 0
<RECEIVABLES> 144703
<ALLOWANCES> 88969
<INVENTORY> 14705
<CURRENT-ASSETS> 337611
<PP&E> 284150
<DEPRECIATION> 257797
<TOTAL-ASSETS> 475489
<CURRENT-LIABILITIES> 130042
<BONDS> 0
<COMMON> 42880
0
0
<OTHER-SE> 302567
<TOTAL-LIABILITY-AND-EQUITY> 475489
<SALES> 1024509
<TOTAL-REVENUES> 1029553
<CGS> 335636
<TOTAL-COSTS> 335636
<OTHER-EXPENSES> 723257
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (29340)
<INCOME-TAX> 0
<INCOME-CONTINUING> (29340)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (29340)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
