<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X Quarterly Report Pursuant to Section 13 or 15(d)
- --- of the Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 2000
or
Transition Report Pursuant to Section 13 or 15(d)
- --- of the Securities Exchange Act of 1934
For the Transition Period from _____ to _____
Commission File No. 0-19614
H.D. VEST, INC.
(Exact name of registrant as specified in its charter)
Texas 75-2154244
------------------------------- ------------------
(State or other jurisdiction of (IRS Employer ID.)
incorporation or organization)
6333 North State Highway 161, Irving, Texas 75038
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code (972) 870-6000
Indicate by check mark whether the registrant (1) has filed all reports
required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such requirements for the
past 90 days.
Yes X No
----- -----
Number of shares of the registrant's Common Stock outstanding as of March 31,
2000: 5,423,341.
1
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H.D. VEST, INC.
INDEX
PART I. Financial Information (Unaudited) Page(s)
--------------------------------- -------
Item 1. Financial Statements
Consolidated Statements of Financial
Position - March 31, 2000 and
September 30, 1999 3-4
Consolidated Statements of Operations -
Three Months Ended March 31, 2000 and
March 31, 1999 5
Consolidated Statements of Operations -
Six Months Ended March 31, 2000 and
March 31, 1999 6
Consolidated Statements of Cash Flows -
Six Months Ended March 31, 2000 and
March 31, 1999 7
Notes to Consolidated Financial
Statements 8-11
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 12-15
PART II. Other Information
-----------------
Item 1. Legal Proceedings 16
Item 4. Submission of Matters to a Vote
of Shareholders 16
Item 5. Other Information 16
Item 6. Exhibits and Reports on Form 8-K 16
Signatures 17
2
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Part I. Financial Information
- ------------------------------
Item 1. Financial Statements(Unaudited)
- ----------------------------------------
H.D. VEST, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
ASSETS
(Unaudited)
March 31, September 30,
2000 1999
----------- ------------
Current assets:
Cash and cash equivalents $22,259,647 $11,918,613
Commissions and accounts
receivable 13,538,197 10,857,090
Receivable from affiliate 552,686 275,390
Prepaid and other assets 1,838,187 1,025,506
----------- ------------
Total current assets 38,188,717 24,076,599
----------- ------------
Property and equipment, net
of accumulated depreciation
of $5,085,113 at March 31,
2000 and $3,997,687 at
September 30, 1999 8,400,059 6,713,270
Intangible and other assets 4,435,935 3,680,780
----------- ------------
$51,024,711 $34,470,649
=========== ============
The accompanying notes are an integral part of these consolidated
financial statements
3
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H.D. VEST, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
LIABILITIES AND SHAREHOLDERS' INVESTMENT
(Unaudited)
March 31, September 30,
2000 1999
----------- ------------
Current liabilities:
Accounts payable and accrued
expenses $ 7,469,244 $ 5,406,058
Line of credit 3,000,000 -
Amounts due on clearing
transactions 9,237,059 2,952,533
Unearned Revenue 1,818,658 2,063,112
Commissions payable 10,692,308 7,075,254
----------- -----------
Total current liabilities 32,217,269 17,496,957
----------- -----------
Obligations under capital leases,
excluding current installments 2,623,593 1,940,638
Other noncurrent liabilities 7,085,091 5,551,758
Shareholders' investment:
Preferred stock, $6 par value;
250,067 shares outstanding 1,500,402 1,500,402
Common stock, $.05 par value;
100,000,000 shares authorized;
5,423,341 issued and outstanding 271,167 271,167
Additional paid-in capital 5,154,934 5,154,934
Retained earnings 2,172,255 2,554,793
----------- -----------
Total shareholders' investment 9,098,758 9,481,296
----------- -----------
$51,024,711 $34,470,649
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
4
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H.D. VEST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
----------------------------
2000 1999
-------------- -----------
Revenues:
Commissions $42,005,117 $27,401,565
Portfolio management fees 6,323,744 5,378,402
Marketing and education fees 2,677,930 2,165,536
Facility and service fee from
affiliate 125,528 108,114
Interest and other 576,653 241,354
----------- -----------
Total revenues 51,708,972 35,294,971
----------- -----------
Expenses:
Commissions 30,685,243 20,283,391
Portfolio management fees 4,852,569 3,840,807
General and administrative 6,081,619 6,156,232
Operations 2,790,899 2,590,850
Website development and promotion 7,842,726 -
Representative development 1,892,940 1,549,782
Representative recruiting 147,753 475,626
Amortization and depreciation 977,504 539,893
Interest 98,511 104,193
----------- -----------
Total expenses 55,369,764 35,540,774
----------- -----------
Loss before taxes (3,660,792) (245,803)
Income taxes (1,481,639) (101,351)
----------- -----------
Net loss $(2,179,153) $ (144,452)
=========== ===========
Net loss per common
share-basic and diluted $ (0.41) $ (0.03)
=========== ===========
Weighted average number of
common shares outstanding 5,423,341 5,423,341
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
5
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H.D. VEST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Six Months Ended March 31,
--------------------------
2000 1999
------------ -----------
Revenues:
Commissions $73,611,131 $53,082,045
Portfolio management fees 12,569,720 10,097,930
Marketing and education fees 8,079,561 5,858,971
Facility and service fee from
affiliate 300,528 278,742
Interest and other 1,058,456 512,670
----------- -----------
Total revenues 95,619,396 69,830,358
----------- -----------
Expenses:
Commissions 54,434,647 39,395,570
Portfolio management fees 9,277,403 7,129,442
General and administrative 10,881,200 11,382,600
Operations 6,756,295 5,509,875
Website development and promotion 7,666,680 -
Representative development 4,634,178 4,000,020
Representative recruiting 404,786 1,093,518
Amortization and depreciation 1,785,162 1,051,644
Interest 172,080 198,835
----------- -----------
Total expenses 96,012,431 69,761,504
----------- -----------
Net income (loss) before taxes (393,035) 68,854
Income taxes (106,149) 33,902
----------- -----------
Net income (loss) $ (286,886) $ 34,902
=========== ===========
Net loss per common share
- basic and diluted $(0.07) $(0.01)
=========== ===========
Weighted average number of
common shares outstanding 5,423,341 5,423,341
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
6
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H.D. VEST, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended March 31,
--------------------------
2000 1999
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (286,886) $ 34,902
Noncash items included in income:
Depreciation and amortization 1,785,161 1,051,613
Deferred tax liability 631,621 -
Loss on disposal of assets 18,709 6,792
Deferred rent 38,850 68,814
Changes in assets and liabilities:
Commissions and accounts receivable (2,681,107) 1,368,154
Receivable from affiliate (277,296) (111,003)
Prepaid and other assets (812,681) (79,823)
Accounts payable and accrued expenses 1,489,915 (2,830,285)
Amounts due on clearing transactions 6,284,526 (141,332)
Commissions payable 3,617,054 2,712,184
Unearned revenues (244,454) (791,732)
----------- -----------
Net cash provided by
operating activities 9,563,412 1,288,284
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (868,825) (241,529)
Costs to acquire/develop software (1,370,294) (1,267,063)
Additions to Intangible and other assets (50,401) (2,200)
----------- -----------
Net cash used in investing activities (2,289,520) (1,510,792)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Preferred stock dividends (95,652) (63,768)
Proceeds from deferred compensation plan 992,073 676,295
Proceeds from line of credit 3,000,000 -
Payments on deferred compensation plan (52,759) (78,122)
Payments received on notes receivable
-related parties - 446,568
Payments on capital lease
obligations (776,520) (554,394)
----------- -----------
Net cash provided by
financing activities 3,067,142 426,579
----------- -----------
NET INCREASE IN CASH AND CASH
EQUIVALENTS 10,341,034 204,071
CASH AND CASH EQUIVALENTS,
September 30, 1999 and 1998 11,918,613 9,204,362
----------- -----------
CASH AND CASH EQUIVALENTS,
March 31, 2000 and 1999 $22,259,647 $ 9,408,433
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
7
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H.D. VEST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1) Basis of Financial Statements
The accompanying unaudited consolidated financial statements have been prepared
in accordance with Rule 10-01 of Regulation S-X, "Interim Financial Statements,"
and accordingly do not include all information and footnotes required under
generally accepted accounting principles for complete financial statements. The
financial statements have been prepared in conformity with the accounting
principles and practices as disclosed in H.D. Vest's (the Company) annual report
on Form 10-K for the year ended September 30, 1999. In the opinion of
management, these interim financial statements contain all adjustments
(consisting only of normal recurring adjustments) necessary for a fair
presentation of the Company's financial position as of March 31, 2000, and
September 30, 1999, the results of operations for the three and six month
periods ended March 31, 2000 and 1999 and the cash flows for the six month
periods ended March 31, 2000 and 1999. Results of operations for the interim
period ended March 31, 2000, are not necessarily indicative of the results that
may be expected for the year ended September 30, 2000. For additional
information, refer to the consolidated financial statements and footnotes
included in the Company's annual report on Form 10-K for the year ended
September 30, 1999.
Certain reclassifications have been made to prior year's statements in order for
the amounts to be comparable with the current year presentation.
2) Earnings Per Share
Basic earnings per share (basic EPS) is computed by dividing income available to
common shareholders by the weighted average number of common shares outstanding.
The number of shares used to compute basic EPS for the three and six months
ended March 31, 2000 and 1999, was 5,423,341. Diluted earnings per share
(diluted EPS) is computed similarly to the computation of basic EPS except that
the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential dilutive common shares had
been issued. The number of shares used to compute diluted EPS for the three and
six months ended March 31, 2000 were 5,660,579 and 5,594,737, respectively. The
number of shares used to compute diluted EPS for the three and six months ended
March 31, 1999 was 5,423,341.
The total number of options outstanding at March 31, 2000 were 931,948. Options
to purchase 273,948 shares of common stock at prices ranging from $7.63 to
$20.00 per share were outstanding during the three and six months ended March
31, 2000 and were not included in the computation of diluted EPS because the
options' exercise price was greater than the average market price of outstanding
common shares.
8
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The total number of options outstanding at March 31, 1999 were 385,948. Options
to purchase 53,948 shares of common stock at prices ranging from $7.63 to $8.50
per share were outstanding during the three and six months ended March 31, 1999
and were not included in the computation of diluted EPS because the options'
exercise price was greater than the average market price of outstanding common
shares.
There were 250,067 shares of Non-voting Series A Convertible Preferred Stock
outstanding during the three and six months ended March 31, 2000 and 1999, that
were not included in the number of shares used to compute diluted EPS for the
period because the conversion had an anti-dilutive effect on EPS.
3) Commitments and Contingencies
The Company is subject to other legal proceedings and claims that have arisen in
the ordinary course of business and have not been finally adjudicated. The
Company believes, based on the advice of legal counsel responsible for such
matters, that these actions, when finally concluded and determined, will not
have a material adverse effect upon the financial position of the Company.
4) Related Parties
The Company has an agreement with Herb D. Vest (principal common shareholder)
for management services to the Company. Previously, the agreement with Mr. Vest
provided for a management fee per year plus an annual bonus based on the
Company's performance related to revenue and net income goals, additions of
Company U4's and Fee Based Assets under Management, as established by the Board
of Directors. In January 2000, Herb D. Vest and the Company agreed to remove the
bonus provision from Mr. Vest's management agreement for the fiscal year ending
September 30, 2000. The agreement also provides that Mr. Vest is permitted to
request and receive advances on future management fees based on estimated future
operations. At March 31, 2000, Mr. Vest had received $900,000 under this
agreement, consisting of $450,000 in management fees related to the six months
ended March 31, 2000 and advances totaling $450,000 (recorded in Prepaid and
other assets). Bonuses paid under the plan for the fiscal years ended September
30, 1999, 1998 and 1997 were $2,315,412, $2,320,148 and $1,869,497,
respectively.
The Company has an agreement to provide Herb D. Vest a revolving line of credit
in an amount not to exceed $2,000,000, collateralized by Mr. Vest's Company
common stock in an amount equal to the unadjusted current balance of the line of
credit based on the stock's current ask price. Under the agreement interest
accrues on unpaid principal balances at an annual rate of 11%. During the
quarter ended March 31, 2000, Mr. Vest at various dates drew down a total of
$207,430 against the line. On March 28, Mr. Vest repaid the full amount plus
interest of $4,308. At March 31, 2000, Mr. Vest had no outstanding principal or
accrued interest outstanding on this line.
9
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The Company, in accordance with the terms of a facilities and services
agreement, provides certain management and other services to ("HDVIns") and is
paid a fee for these services. The value of these services for three and six
months ended March 31, 2000 has been determined based on the prorata portion of
certain relevant expenses as a percentage of HDVIns revenues to total
consolidated revenues. To the extent the Company renders services to HDVIns for
which it is not compensated at fair market value, such action could constitute a
conflict of interest since Mr. Vest is both the principal common shareholder and
Chairman of the Board of Directors of the Company. Effective January 1, 2000,
Mr. Vest converted his sole proprietorship into 13 different insurance agencies.
The Company entered into a new facilities and services agreement with the
insurance agencies under the same material terms and conditions as those
contained in the agreement with the sole proprietorship described previously.
5) Web-Based Fees
During the six months ended March 31, 2000, the Company invited selected
Representatives to participate in the Company's new website initiative. Each
Representative that elected to participate in the website initiative will have
their individual profile included on the website and will be eligible for new
tax and financial services referrals obtained from the website. As part of the
website initiative the Company charged each Representative that elected to
participate in the program, a fee of $950 to help offset the costs associated
with the promotion and development of the website. Each Representative that
elected to participate in the website initiative prior to December 31, 1999, has
the option to drop out of the program on October 1, 2000 and receive a full
refund of the $950 fee plus interest. As of March 31, 2000, approximately 2,100
Representatives have been included in the website initiative. For the six
months ended March 31, 2000, the Company recognized $750,000 of these fees. The
remainder has been reserved for potential refund requests.
6) Segment Reporting
Effective January 2000, H.D. Vest Technology Services, Inc. ("HDVTI"), a wholly
owned subsidiary of the Company became a reportable segment as defined by SFAS
131, "Disclosures about Segments of an Enterprise and Related Information".
H.D. Vest's Core business ("Core") is in the business of financial services,
organized for the purpose of investing in financial service companies and
providing management services to such companies as well as other entities. H.D.
Vest does not track assets by operating segments. Consequently, we have not
disclosed assets by operating segments. For internal and external management
reporting purposes all amounts have been restated to be effective as of October
1, 1999. The following unaudited results are separated by operating segment for
the three and six months ended March 31, 2000:
10
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For the three months ended March 31, 2000
Core HDVTI Consolidated
----------------------------------------------------
Revenues 51,696,936 12,036 51,708,972
Expenses 47,356,073 8,013,691 55,369,764
----------------------------------------------------
Net income (loss)
before taxes 4,340,863 (8,001,655) (3,660,792)
----------------------------------------------------
Income taxes 2,119,106 (3,600,745) (1,481,639)
----------------------------------------------------
Net income (loss) 2,221,757 (4,400,910) (2,179,153)
====================================================
For the six months ended March 31, 2000
Core HDVTI Consolidated
----------------------------------------------------
Revenues 95,607,360 12,036 95,619,396
Expenses 88,148,313 7,864,118 96,012,431
----------------------------------------------------
Net income (loss)
before taxes 7,459,047 (7,852,082) (393,035)
----------------------------------------------------
Income taxes 3,427,288 (3,533,437) (106,149)
----------------------------------------------------
Net income (loss) 4,031,759 (4,318,645) (286,886)
====================================================
7) Subsequent Event
On April 27, 2000, the Company was notified of a claim brought by clients of a
former Registered Representative against H.D. Vest Investment Securities, Inc.,
alleging actual damages of approximately $450,000 arising from alleged conduct
of the Representative. The Company is reviewing the claim, which has not yet
resulted in litigation, and is unable at this time to determine what, if any,
potential liability the Company may have in regard to this matter. The Company
believes that it has a defense against all claims and intends to vigorously
defend them. The Company has not accrued any amount for this claim.
11
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
- --------------------------------------------------------------------------------
OF OPERATIONS
- -------------
Results of Operations
Revenues
The Company's revenues for the three months ended March 31, 2000, were
$51,708,972, a 47% increase over the Company's revenues for the three months
ended March 31, 1999. The Company's revenues for the six months ended March 31,
2000, were $95,619,396, a 37% increase over the Company's revenues for the six
months ended March 31, 1999. Management believes that the increase in revenues
is due to (i) the continued strength in overall financial markets, (ii) the
Company's commitment to training and developing Representatives in
diversification and long-term investment activities, and (iii) the number of
Representatives and their experience in the financial planning and sales
industry directly impact revenues.
For the three months ended March 31, 2000, portfolio management fees were
$6,323,744, a 18% increase from the three months ended March 31, 1999. For the
six months ended March 31, 2000, portfolio management fees from these programs
were $12,569,720, a 24% increase from the six months ended March 31, 1999. The
decline in the growth rate of portfolio management fees for the quarter relates
to a one time change in the timing of client billings. It is anticipated that
this change will not have an impact on future revenue growth. Total assets
under management grew approximately 50% from $1.4 billion at March 31, 1999 to
$2.1 billion at March 31, 2000. Due to the declining industry-wide trend of
commission revenue as a percentage of gross product sales, the Company has
continued to devote resources to the development of its fee-based programs. Fee-
based programs produce revenue based on quarterly charges to clients for the
management of their accounts, whereas commission-based services produce revenue
based primarily on one-time front-end sales charges for the purchase of
products. Some clients may prefer fee-based programs as opposed to more
traditional commission-based services.
Net Income (Loss)
The Company had a net loss of $2,179,153 for the three months ended March 31,
2000, compared to a net loss of $144,452 for the three months ended March 31,
1999. The Company had a net loss of $286,886 for the six months ended March 31,
2000, compared to net income of $34,902 for the six months ended March 31, 1999.
Net income for the three and six months ended March 31, 2000, decreased from the
prior year primarily due to significant investments in the Company's website
initiative. This investment includes advertising and public relations expense
of approximately $7 million for the six months and over $6 million for the three
months. The web site is intended to promote brand awareness, provide lead
generation for our Representatives and to facilitate the marketing of financial
12
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products and services. The Web site includes, among other things, a tax planning
organizer and program allowing consumers to prepare their tax returns free of
charge, retirement and college funding calculators, debt management
recommendations, insurance and risk management information, links to our
nationwide network of Representatives, and access to on-line strategic partners
products and services and options. In addition, a financial planning analysis,
a customized monthly newsletter, and tax updates are provided to the consumers
generated from tax return information.
Commission revenue increased at a faster rate than commission expense for the
three and six months ended March 31, 2000. Because of extensive training and
recruiting performed by the Company, Representatives in lower payout categories
have offset increased revenue by Representatives in higher payout categories.
Portfolio management fee expense increased at a faster rate than the related
revenue due primarily to Representatives moving into higher payout categories as
well as increased production from Representatives in higher payout categories.
Management believes that in periods of short-term economic fluctuations,
established Representatives have an advantage over less experienced
Representatives in selling investment products.
General and administrative expenses decreased 1% to $6,081,619 for the three
months ended March 31, 2000, compared to the prior year. General and
administrative expenses decreased 4% to $10,881,200 for the six months ended
March 31, 2000, compared to the prior year. General and administrative expense
for the three and six months ended March 31, 2000, decreased in part due to cost
containment activities conducted by the Company's management and a reduction in
the fees related to Mr. Vest's management agreement.
Operations costs for the three months ended March 31, 2000 were $2,790,899 an 8%
increase compared to the prior year. Operations costs for the six months ended
March 31, 2000 were $6,756,295 a 23% increase compared to the prior year. The
increase in operations costs is mainly due to an increase in the cost of
licensing Representatives. Operations expense also increased due to additional
costs required by the new back office system.
Website development and promotion expense was $7,842,726 for the three months
ended March 31, 2000 and $7,660,680 for the six months ended March 31, 2000.
Website development and promotion expense is mainly comprised of approximately
$6 million of advertising and promotion for the three months and nearly $7
million for the six months. The remaining expenses were noncapitalizable
investments in the Company's e-commerce and branding initiatives.
Representative development costs for the three months ended March 31, 2000 were
$1,892,940, a 22% increase compared to the prior year. Representative
development costs for the six months ended March 31, 2000 were $4,634,178, a 16%
increase compared to the prior year. As a result of prior year Representative
recruiting efforts, Representative development costs have increased due to
increased participation by Representatives and the expansion of staff necessary
to support
13
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participation in these programs. As additional Representatives are recruited,
the Company expects participation and the related costs in development programs
to continue to increase.
Representative recruiting costs for the three months ended March 31, 2000, were
$147,753, a 69% decrease compared to the prior year. Representative recruiting
costs for the six months ended March 31, 2000, were $404,786, a 63% decrease
compared to the prior year. The reduction in recruiting costs is the result of a
decreased focus on Representative recruiting efforts. To the extent that the
Company decides in the future to devote significant resources to rapidly expand
its Representative base through aggressive recruiting activities, future
profitability would likely be negatively impacted.
Certain sections of this Management's Discussion and Analysis of Financial
Condition and Results of Operations include forward-looking statements that
involve a number of risks and uncertainties. In addition to the factors
described above, among other factors that could cause actual results to differ
materially include: drastic changes in market conditions; effects of new
technology; interest rates; regulatory changes; changes in the availability of
prospective Representatives; and the risks described from time to time in the
Company's SEC reports, including but not limited to the report on Form 10-K for
the year ended September 30, 1999.
Liquidity and Capital Resources
At March 31, 2000, the Company had net working capital of $5,971,448 compared to
net working capital of $6,579,642 at September 30, 1999. The $608,194 decrease
is primarily a result of the net loss for the period ended March 31, 2000. The
net loss is in part due to the increase in advertising and public relations
expense compared to the period ended March 31, 1999. During the three months
ended March 31, 2000, the Company increased its line of credit with a bank from
$1 million to $3 million. The new line of credit bears interest, payable
monthly, at prime plus 1/2% (9.3% as of March 31, 2000) and matures in February
of 2001 The Company drew down the entire line of credit during the quarter. The
previous $1 million line had not been drawn upon at September 30, 1999 or
December 31, 1999.
During the first six months of fiscal 2000, the Company dedicated much of its
capital to the development and promotion of a new interactive financial planning
Web site and to costs incurred for the ongoing implementation of other computer
systems related to its operating and marketing efforts. These other operating
systems include the Company's new Representative contact management system,
enhancements to the Company's internet site, a back office system
implementation, and providing more technology tools for Representative use.
Management believes that this dedication to information systems will provide the
Company with more capacity to manage its current growth, support future growth
and will lead to an increase in efficiency.
The Company continually monitors the capital markets for opportunities to obtain
financing to meet Company growth needs. To the extent that
14
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funds are available, the Company would accelerate the development and promotion
of the Company's e-commerce strategy. Other funds would be utilized for
recruiting, development and other general business purposes. The Company is
required to expense many of the costs related to these items. Should the Company
obtain future financing to fund these growth plans, it is likely that it would
record substantial expenses in the periods during and subsequent to obtaining
such financing.
15
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PART II OTHER INFORMATION
- --------------------------
Item 1. Legal Proceedings
- --------------------------
The Company is subject to other legal proceedings and claims that have arisen in
the ordinary course of business and have not been finally adjudicated. The
Company believes, based on the advice of legal counsel responsible for such
matters, that these actions, when finally concluded and determined, will not
have a material adverse effect upon the financial position of the company.
Item 4. Submission of Matters to a Vote of Shareholders
- --------------------------------------------------------
None.
Item 5. Other Information
- --------------------------
To the extent that the Company or third-party providers cannot correct material
Year 2000 issues, and is unable to efficiently conduct business in accordance
with anticipated contingency plans, the Company's operations could be negatively
impacted.
The foregoing information is a Year 2000 readiness disclosure.
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
No reports on Form 8-K were filed during the quarter ended March 31, 2000.
16
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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 thereunto duly authorized.
H. D. VEST, INC.
-------------------------
(Registrant)
Date: May 12, 2000 By: /s/ Herb D. Vest
-------------------------
Herb D. Vest
Chief Executive Officer,
Chairman of the Board
Date: May 12, 2000 By: /s/ Wesley Ted Sinclair
-------------------------
Wesley Ted Sinclair
Chief Financial Officer,
Vice President (Principal
Financial and Accounting
Officer)
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> BD
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 22,259,647
<RECEIVABLES> 13,538,197
<SECURITIES-RESALE> 0
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0
1,500,402
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