U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2000
--------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ________________ to ________________
Commission File Number 0-20922
----------
WHITEHALL ENTERPRISES, INC.
-------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 75-2274730
(State or jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
801 Brickell Avenue, 9th Floor, Miami, Florida 33131
(Address of principal executive offices)
(904) 409-0200
-------------------
(Issuer's telephone number)
______________________________________________________________________________
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports) and (2)
has been subject to such filing requirements in the past 90 days.
Yes [X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 135,025,000 shares as of
March 31, 2000.
<PAGE>
WHITEHALL ENTERPRISES, INC.
FORMERLY KNOWN AS
TOTAL WORLD TELECOMMUNICATIONS, INC.
<TABLE>
<CAPTION>
INDEX
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements (unaudited)
Consolidated Balance Sheets - March 31, 2000 and September 30, 1999
Consolidated Statements of Operations -- Six and Three Months Ended
March 31, 2000 and 1999
Statements of Cash Flows -- Six and Three Months Ended March 31, 2000
and 1999
Notes to Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of
Operations
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Financial Statements, Pro Forma Financial Information and Exhibits
</TABLE>
2
<PAGE>
WHITEHALL ENTERPRISES, INC.
FORMERLY TOTAL WORLD TELECOMMUNICATIONS, INC.
Consilidated Balance Sheet - Unaudited
March 31, 2000 and September 30, 1999
<TABLE>
<CAPTION>
ASSETS
Unaudited
March 31, 2000 September 30, 1999
-------------- ------------------
<S> <C> <C>
Current Assets
Cash $ 142,575 $ 2,264
Accounts receivable 728,664 577,477
Inventories 447,231 448,361
Prepaid Expenses 217,387 73,949
----------- -----------
Total Current Assets 1,535,857 1,102,051
----------- -----------
Loans Receivable 2,787,518 1,608,853
----------- -----------
Deferred Financing Costs 449,462 279,337
----------- -----------
Property and Equipment 1,044,327 2,662,553
Less Accumulated Depreciation (249,065) (2,142,371)
----------- -----------
Property and Equipment - Net 795,262 520,182
----------- -----------
Investments in MBM 0 0
Investments in Alternative Lending 0 0
Investments in Direct Financing llc 0 0
Investment in Hairbiotech 0 0
Other Assets
Patents 350000 350000
Goodwill 687621 0
Deposits 10,736 1,166
----------- -----------
TOTAL ASSETS $ 6,616,456 $ 3,861,589
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Current Liabilities
Capital lease obligations - current portion 103405.027 0
Current portion of long term debt 0 536,510
Notes payable - bank 1608811.64117 525,624
Income taxes payable 739 30,413
Accounts payable 1169149.93706 995,586
----------- -----------
Total Current Liabilities 2,882,106 2,088,133
----------- -----------
Deferred income taxes 45135.84459 54,171
Deferred gain on sale and leaseback transaction 168475.12005 0
Capital leases - non current portion 618473.88277 0
Long Term Debt 754,599 629,771
----------- -----------
Total Liabilities 4,468,789 2,772,075
----------- -----------
Shareholders' Equity
Preferred stock, $.001 par value,
4,000,000 million shares authorized, issued
and outstanding at December 31, 1999 4,000 4,000
Common Stock, $.0001 par value,
200,000,000 shares authorized, 135,025,000
shares issued and outstanding 13,506 12,493
Additional Paid In Capital 2,776,890 998,653
Retained earnings (deficit) (646,730) 74,368
----------- -----------
Total Stockholders' Equity 2,147,666 1,089,514
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 6,616,456 $ 3,861,589
=========== ===========
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
WHITEHALL ENTERPRISES, INC.
FORMERLY TOTAL WORLD TELECOMMUNICATIONS, INC.
Consolidated Statement of Operations - Unaudited
For the Six Months and Three Months Ended March 31, 2000 and 1999
<TABLE>
<CAPTION>
For the Six Months For the Quarter For the Six Months For the Quarter Ended
Ended March 31, 2000 Ended March 31, 2000 Ended March 31, 1999 March 31, 1999
-------------------- -------------------- -------------------- --------------
<S> <C> <C> <C> <C>
Revenues from Operations
Sales $ 2,714,778 $ 1,350,477 $ 1,819,257 $ 1,395,864
Cost of Sales 2,105,509 1,021,603 1,382,152 1,022,498
------------- ------------- ------------- -------------
Gross Profit 609,269 328,874 437,105 373,366
Commissions on loan origination fees 492,153 452,153
------------- ------------- ------------- -------------
Total operating revenues 1,101,422 781,027 437,105 373,366
------------- ------------- ------------- -------------
Operating expenses
Sales, General and Administration 1,669,218 954,744 343,688 254,017
Depreciation 72,082 37,500 44,930 39,675
------------- ------------- ------------- -------------
Total Operating Expenses 1,741,299 992,244 388,618 293,692
------------- ------------- ------------- -------------
Income (loss) from operations (639,878) (211,217) 48,486 79,674
------------- ------------- ------------- -------------
Other Income 26,831 26,831 0 0
------------- ------------- ------------- -------------
Other Expenses
Interest expense (108,052) (64,591) (48,319) (38,531)
------------- ------------- ------------- -------------
Net Income (Loss) ($ 721,099) ($ 248,977) $ 167 $ 41,143
============= ============= ============= =============
Net Income (Loss) Per Common Share ($ 0.01) ($ 0.00) $ 0.00 $ 0.00
============= ============= ============= =============
Number of Shares Used in Computation 135,025,000 135,025,000 124,900,000 124,900,000
============= ============= ============= =============
</TABLE>
See Notes to Financial Statements.
4
<PAGE>
WHITEHALL ENTERPRISES, INC.
TOTAL WORLD TELECOMMUNICATIONS, INC.
Consolidated Statement of Cash Flows - Unaudited
For the Six Months Ended March 31, 2000 and 1999
<TABLE>
<CAPTION>
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Cash flows form operating activities:
Net income $(721,099) $ 168
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation 72,082 44,930
Deferred gain on sale and leaseback transaction 168,475 0
Change in assets and liabilities net of effects from purchase of subsidiaries:
(Increase) in accounts receivable (116,644) (70,540)
(Increase) in inventory 1,130 147,997
(Increase) in prepaid expenses (12,231) 0
(Increase) in loans receivable (77,283) (20,201)
(Increase) decrease in other assets (194,821) 1,774
Increase (decrease) in accounts payable 172,513 (121,706)
Increase (decrease) in tax liabilities (60,308) 0
Stock options issued to officers, directors and others 483,000 0
Increase (decrease) in other liabililities (1,425) 0
--------- ---------
Total adjustments 434,488 (17,746)
--------- ---------
Net cash provided (used) by operating activities (286,611) (17,578)
--------- ---------
Cash flows from investing activities:
Acquisition of equipment (25,414) (32,672)
--------- ---------
Cash flows from financing activities:
Net Borrowings (200,325) 17,201
Proceeds from long term debt and capital lease - net 646,307 0
Proceeds from capital contributions 368,927 0
Payments of long term debt and capital leases (562,497) 0
--------- ---------
Net cash provided (used) by financing activities 252,412 17,201
--------- ---------
Net increase (decrease) in cash and cash equivalents (59,613) (33,049)
Cash received in acquisition of ALG 199,894 0
Cash and cash equivalents - beginning of year 2,264 22,695
--------- ---------
Cash and cash equivalents - end of period $ 142,545 $ (10,354)
========= =========
</TABLE>
See Notes to Financial Statements
5
<PAGE>
WHITEHALL ENTERPRISES, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
March 31, 2000
(1) GENERAL:
The interim March 31, 2000 unaudited consolidated financial statements,
in the opinion of management, include all adjustments (consisting of only normal
recurring accruals) considered necessary for a fair presentation of the
financial position as of such date and earnings and cash flows for the periods
then ended. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted and the Statements of Operations for
the six and three months ended March 31, 1999 have been reclassified for
comparative purposes. It is recommended that these interim financial statements
be read in conjunction with the financial statements and the notes thereto
included in the Company's Annual Report on Form 10-KSB for the fiscal year ended
September 30, 1999.
The consolidated financial statements of the Company include those
accounts of Whitehall Enterprises, Inc., Hairbiotech, Inc. ("HBI"), a
development stage biotechnology company, Alternative Lending Group, Inc. ("ALG")
and Direct Financial LLC ("DF"), financial service companies that originate,
broker and fund residential loans to individuals, and Mega Blow Plastics Limited
("MBM"), a Canadian plastics manufacturing company. All significant intercompany
transactions and balances have been eliminated in the consolidation. The
acquisition of ALG was effective January 25, 2000 and the acquisition of DF was
effective March 23, 2000.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Operating results for the six and three-month periods ended
March 31, 2000 are not necessarily indicative of the results that may be
expected for the year ending September 30, 2000.
Cash and Cash Equivalents
The Company considers all highly liquid debt instruments purchased with an
original maturity of three months or less to be cash equivalents.
6
<PAGE>
Inventories
Inventories from Mega Blow Moulding, Limited, consisting of raw materials,
packaging skids, and finished goods, are valued at the lower of cost or market.
Cost is determined by the first-in first-out method (FIFO) except for finished
goods, which are accounted for on a retail method.
Property and Equipment
Property, machinery, and equipment are stated at cost, and are depreciated over
their estimated useful lives using accelerated and straight-line methods as
follows:
Useful Life
Office equipment 3-5 years
Machinery and equipment 5 years
Leasehold improvements 5 years
Deferred Cost
Deferred costs include deferred financing costs and corporate transaction costs
and are stated at cost less accumulated amortization. These costs are amortized
between five and seven years using the straight-line method.
Patents
Patents for hair growth and hair loss prevention technologies owned by HBI are
recorded for their acquisition costs. Patents are amortized over their estimated
useful lives, approximately 17 years.
Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board issued Statement of
Accounting Standards No. 131, Disclosures About Segments of an Enterprise and
Related Information (SFAS No. 131) which established presentation of financial
data based on the "management approach". SFAS No. 131 is applicable for fiscal
years beginning after December 15, 1997.
Accounting Policies
MBM's products are manufactured to specific customer orders and revenues are
recognized when the products are shipped. Revenue is reduced for estimated
customer returns and allowances.
Origination fees in ALG and DF for warehoused loans are recognized as revenue
when the loans are made to the extent they represent reimbursement of loan
origination costs. Revenues in the form of origination points, service release
premiums and other fees are recognized upon the funding of the mortgage loan by
the ultimate lender. Sales of loan inventory are generally without recourse and
are recorded when the proceeds are received by the Company. Other revenues are
recognized as income when earned.
7
<PAGE>
In addition to the advertising expenses incurred as a result of normal
operations, the Company participates in various advertising and promotion
programs relative to its financial services division. All costs related to
advertising and promotion are expensed in the period incurred. Costs for
advertising and promotion programs totaled approximately $190,000 for the
quarter ended March 31, 2000.
Income Taxes
The Financial Accounting Standards Board (FASB) issued Statement of Financial
Accounting Standards (SFAS) No. 109 Accounting for Income Taxes, requiring
companies to use the asset and liability method of accounting for income taxes.
Under the asset and liability method, deferred income taxes are recognized for
the tax consequences of temporary differences by applying enacted statutory tax
rates applicable to future years to differences between the consolidated
financial statement carrying amounts and the tax basis of existing assets and
liabilities. Pursuant to SFAS No. 109, the effect on deferred taxes of a change
in tax rates is recognized in income in the period that includes the enactment
date. Under the deferred method, deferred taxes were recognized using the tax
rate applicable to the year of the calculation and were not adjusted for
subsequent changes in tax rates. The Company adopted SFAS No. 109 in 1993.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of
credit risk are primarily cash and accounts receivable. The Company extends
credit based on an evaluation of the customer's financial condition, generally
(except for mortgages receivable) without requiring collateral. Exposure to
losses on receivables is principally dependent on each customer's financial
condition. The Company monitors its exposure for credit losses and maintains
allowances for anticipated losses.
In addition, at March 31, 2000, the Company had deposits with financial
institutions, which were insured for up to $100,000 by the U.S. Federal Deposit
Insurance Corporation. The Company believes it is not exposed to any significant
credit risk on cash and cash equivalents.
The Company's financial services division does not have any significant off
balance sheet risks as of March 31, 2000 and 1999. The Company believes its is
not exposed to any significant credit risk on bank balances above insured
limits. Company management is well trained and has had very little turnover in
the past, allowing them to easily fill in work duties if one of the managerial
team was temporarily out of the office.
ALG and DF are an FHA, VA, Fannie Mae correspondent lender. All FHA loans
originated are subject to FHA/HUD Title I and II regulations. Consequently, all
these loans are fully insured by FHA. Company management believes the credit
risks associated with specific borrowers and geographic concentrations are not
significant. A 100% pre-funding quality control program helps limit the risks
associated with the closing of all loans.
8
<PAGE>
Financial instruments in ALG include fully collateralized mortgages pending sale
to investors (Note 9) amounting to $1,169,885 at March 31, 2000. The Company
operates using a warehouse line of credit facility from a national banking
institution (Note 9), the disruption of which could have a near-term impact on
the Company. Company management believes the credit risk associated with these
financial instruments is not significant.
(2) AMENDED PLAN OF REORGANIZATION UNDER CHAPTER 11 OF THE UNITED STATES
BANKRUPTCY COURT:
The Company filed with the United States Bankruptcy Court for the
Southern District of Florida (the "Bankruptcy Court") its Amended Plan of
Reorganization dated July 2, 1998, under Chapter 11 of the United States
Bankruptcy Code.
The Plan had been approved by the Company's Board of Directors. In
addition, Advantage Fund Limited, formerly known as GFL Advantage Fund Limited
("Advantage"), which held in excess of 90% of the unsecured claims against the
Company, consented to the Plan as part of a settlement between the Company and
Advantage.
The Company's efforts resulted in (a) the Advantage Settlement
Agreement, which was approved by the Bankruptcy Court, and (b) an agreement for
the Company to acquire all of the stock of MBM, pursuant to which MBM became a
wholly-owned operating subsidiary of the Company. On August 28, 1998, the Plan
was confirmed by the Bankruptcy Court.
(3) EARNINGS PER SHARE
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, Earnings Per Share (SFAS
No. 128), which specifies the computation, presentation and disclosure
requirements for earnings per share. Basic earnings per share are computed by
dividing income available to common stockholders (the numerator) by the
weighted-average number of common shares (the denominator) for the period. The
computation of diluted earnings per share is similar to basic earnings per
share, except that the denominator is increased to include the number of
additional common shares that would have been outstanding if the potentially
dilutive common shares had been issued.
The numerator in calculating basic earnings per share is reported net income or
(loss). The denominator is based on the following weighted-average number of
common shares:
2000 1999
---- ----
Basic 135,025,000 124,928,000
9
<PAGE>
(4) EQUITY TRANSACTIONS
A summary of the stock is as follows:
Common Stock - Authorized 200,000,000 shares, $.0001 par value per
share. Issued and outstanding 135,025,000 shares of common stock.
Preferred Stock - Authorized 4,000,000 shares of preferred stock at
$.001 par value per share. The stock is outstanding as part of the purchase of
MBM. On December 10, 1998, 4,000,000 shares of preferred stock with a par value
of $.001 were conditionally issued under a stock purchase agreement between the
Company and 1274328 Ontario. In exchange for these shares, the Company acquired
100% of the outstanding common stock of Mega Blow Moulding, Limited ("MBM").
There is a five (5) year restriction on the conversion of preferred shares to
common shares pursuant to the Agreement.
During July 1999, 1274328 Ontario issued to Luis Alvarez - CEO, an
irrevocable option to purchase the 4 million preferred shares for $310,400.
During October 1999 the Company's Board of Directors ratified
management's previous decision to decrease the conversion rate of the authorized
preferred stock. The rate in effect at the time of the meeting was 100 common
shares for each share of preferred stock. The new authorized conversion rate is
27 shares of common stock per each share of preferred stock leaving control in
the public's hands where it belongs, and thus not compromising the tax loss
carryforward.
During February 2000, the Company issued the preferred shares and is
holding them during the "Exercise Period," subject to the Irrevocable Option
Agreement between 1274328 Ontario, Inc. and Mr. Luis Alvarez. The "Exercise
Period" expires July 30, 2001. Mr. Alvarez is free to exercise said options at
any time prior to the expiration date.
Stock options - During the October 1999 Board of Directors meeting, the
Company approved the payment of fees to consultants, legal counsel and officers
and directors in the form of stock options. The following summarizes the fees
and the shares provided at a calculated price of $0.03 (consistent with the
closing share price of October 22, 1999, the date of the Board meeting) and an
exercise price of $0.30, expiring in five years. The Board deemed that using a
calculated price of $0.03 was fair for remunerating the Board members for their
efforts throughout the past years. However, with the best interests of both, the
shareholders and the Company as the recipient of the options proceeds in mind,
the Board set an exercise price of ten times the current price of $0.03 per
share as of the date of the meeting to $0.30.
10
<PAGE>
Option Shares Fees
------------- ----
Officers 18,000,000 $ 260,000
Directors 2,200,000 48,000
Consultants 4,334,000 130,000
Legal counsel 1,500,000 45,000
-----------
Total expenses paid
with options $ 483,000
===========
Stock options were recorded as additional paid in capital in accordance with
SFAS No. 123.
The Alternative Lending Group Acquisition
On January 25, 2000, the Company closed on the purchase of 100% of the
common stock of Alternative Lending Group ("ALG") and all its related assets.
Alternative Lending Group, Inc., is an Illinois corporation that is engaged in
the mortgage banking and brokerage business. The Company acquired 100% of the
shares of common stock of Alternative Lending Group, Inc. in exchange for
$950,000 of working capital for Alternative Lending Group, Inc., and 8,000,000
shares of common stock equivalent to 4% of 200,000,000 shares. In the event that
prior to one year to the date of closing, the amount of authorized common shares
of the Company exceed the 200,000,000 authorized shares, a proportional
adjustment shall be made to compensate the seller for the difference. The
acquisition of ALG will be accounted for as a stock purchase under Accounting
Principles Board Opinion No. 16. The results of operations of the acquired
company were included in the consolidated results of operations of the Company
from the respective acquisition date.
11
<PAGE>
The estimated fair value of assets acquired and liabilities assumed is
summarized as follows:
Current assets $ 1,354,313
Property and equipment 45,783
Other assets 122,203
Current liabilities (169,597)
Warehouse line of credit - bank (1,094,203)
Obligations under capital leases (17,143)
Deferred income taxes (18,000)
-----------
$ 223,356
===========
The Direct Financial LLC Acquisition
------------------------------------
On March 23, 2000 Alternative Lending Group, a wholly owned subsidiary
of Whitehall Enterprises, Inc., purchased Direct Financial, LLC, a Michigan
Limited Liability Company by the issuance of two million one hundred twenty-five
thousand (2,125,000) shares of the Company's common stock. The transaction was
closed on March 23, 2000. The acquisition of Direct Financial LLC was accounted
for as a stock purchase under Accounting Principles Board Opinion No. 16. The
results of operations of the acquired company were included in the consolidated
results of operations of the Company from the respective acquisition date.
The estimated fair value of assets acquired and liabilities assumed is
summarized as follows:
Current assets $ 58,615
Property and equipment 97,329
Other assets 4,012
Current liabilities (83,936)
Obligations under capital leases (55,747)
--------
$ 20,273
========
(5) LEGAL PROCEEDINGS:
- ---------------------------
All legal proceedings were eliminated upon the certification of the
Plan of Reorganization by the Bankruptcy Court.
(6) PROPERTY AND EQUIPMENT:
- ----------------------------
Property and equipment at March 31, 2000 and September 30, 1999
consisted of the following:
March 31 September 30
2000 1999
---- ----
Furniture and fixtures $ 231,361 $ 143,751
Machinery and equipment 681,570 2,514,860
Leasehold improvement 3,942 3,942
----------- -----------
916,873 2,662,553
Less: accumulated depreciation (162,436) (2,142,371)
----------- -----------
Total $ 754,437 $ 520,182
=========== ===========
12
<PAGE>
Depreciation expense for the six month periods ended March 31, 2000 and 1999 was
$72,082 and $44,930, respectively.
(7) INVENTORY:
- --------------
At March 31, 2000 and September 30, 1999, inventory was as follows:
March 31 September 30
2000 1999
---- ----
Raw materials $186,621 $134,871
Packing and skids 38,601 23,062
Finished goods 427,393 290,428
-------- --------
$652,615 $448,361
======== ========
(8) LOAN RECEIVABLE:
- --------------------
The loan receivable is due on demand and bears an interest rate varying from
6.72% - bank prime plus 2%. The loan is secured by property with a market value
of approximately $5,000,000. (See Note 14: Measurement Uncertainty).
(9) BANK INDEBTEDNESS:
- ----------------------
The bank indebtedness of MBM includes operating loans, due on demand, of
$475,299 ($402,126 as of September 30, 1999). The operating loans bear interest
at rates varying from prime + 1.25% to prime +1.75%. The bank indebtedness is
secured by a registered general assignment of book debts and a general security
agreement, a guarantee and postponement of claim in the amount of $1,465,376 by
129 Ontario, assignment of all shares of the company, postponement and
assignment of all shareholder debt and an assignment of Keyman insurance. As
further explained in Note 11, the bank indebtedness was refinanced with the
proceeds of a capital lease on manufacturing equipment.
MBM had violated certain covenants with respect to the operating loans. While
the bank has been advised of this, they have not expressly waived the
conditions.
ALG has a $2.5 million warehousing line of credit from a financial institution
bearing interest at prime plus 2%, collateralized by mortgage notes and deeds of
trust of the corresponding notes being financed. At March 31, 2000 there were
$1,133,513 outstanding under the agreement which were collateralized by
$1,169,885 in loan inventory held for resale. (See Note 1).
13
<PAGE>
10) LONG TERM DEBT:
- -------------------
At March 31, 2000 and September 30, 1999, long-term debt consisted of the
following:
<TABLE>
<CAPTION>
March 31 September 30
2000 1999
---- ----
<S> <C> <C>
Term loans (See Note 16) -- $ 36,510
Note payable with an interest rate of
12% per annum; monthly interest
consisting of interest only; principal
amount maturing October 1, 2004
754,599 629,771
----------- -----------
754,599 1,166,281
Less current portion -- (536,510)
----------- -----------
$ 754,599 $ 629,771
=========== ===========
</TABLE>
Interest expense for the six months ended March 31, 2000 and 1999 was $108,052
and $48,319, respectively.
(11) CAPITAL LEASE OBLIGATIONS:
- -------------------------------
On December 14, 1999, the term loan in the amount of $536,510 was repaid with
the proceeds from the sale of plastic injection molding equipment. MBM leased
back the equipment for a total amount of $681,570, at an interest rate of 9.35%
per annum, repayable in 72 monthly installments of $12,627, including principal
and interest. The Company has other capital lease obligations relative to
computer equipment with a carrying value of $17,413. At March 31, 2000 capital
lease obligations consisted of the following:
March 31
2000
----
Total proceeds from capital leases $721,879
Current portion 103,405
--------
Non current portion $618,474
========
The Company's Board of Directors, however, has not ratified this transaction due
to MBM management's delay in submitting the necessary documents for said
ratification.
14
<PAGE>
(12) LEASE COMMITMENTS:
- -----------------------
The Company leases office space, vehicles, and office equipment under
noncancelable operating leases. The minimum rentals payable under long-term
operating leases, expiring December 31, 2004, exclusive of certain operating
costs for which the Company is responsible, are approximately $250,000 annually.
(13) RELATED PARTY TRANSACTIONS:
- --------------------------------
Pursuant to the Amended Plan of Reorganization (see Note 2), the bank
indebtedness and the long-term debt are guaranteed by 129 Ontario and a
beneficial shareholder of 129 Ontario.
(14) MEASUREMENT UNCERTAINTY:
- -----------------------------
MBM carries, as an asset, a loan receivable in the amount of $1,617,633. While
management of MBM does not believe the carrying value has been impaired, there
is uncertainty as to the final realization of this amount.
(15) INCOME TAXES:
- ------------------
The Company reduced taxable income for the year ended September 30,
1999, by applying federal net operating losses to pre-tax income, reducing
taxable income by $71,249,531. These losses were carried forward from prior
years. The Company has a remaining federal net operating loss carry forward of
$71,650,735, of which $71,249,531 expires in 2014, and $401,204 expires in 2017.
15
<PAGE>
(16) SIGNIFICANT SUBSEQUENT EVENTS:
- -----------------------------------
The C & M Oil Company, Inc. Transaction
---------------------------------------
On June 12, 1999, the Company signed a letter of intent to acquire C & M
Oil Company, Inc., ("CMO") a Florida corporation. CMO is a bulk lubricant and
service station fuel and mobile on-site fueling business. On February 17, 2000,
the Company and CMO executed a stock purchase agreement for 100% of the shares
of CMO. The Company deposited $138,750 with its escrow agent pursuant to the
terms of the stock purchase agreement. On May 11, 2000, acquisition negotiations
were terminated as conditions relative to the transaction's success were not
deemed in the best interest of the Company.
Sale of MBM
The Company is currently negotiating an agreement to sell its ownership
interest in MBM. The proceeds from the sale will be utilized to meet the cash
flow necessary to finance other acquisitions. The following conditions were
considered in moving forward with the decision to sell MBM.
o 129 Ontario's failure to comply with its responsibilities as
delineated by an agreement between the Company and 129 Ontario
and its inability to produce necessary documentation in a
timely manner.
o The sale of MBM will provide sufficient cash to acquire other
financial service industry companies and biotechnology
companies. These businesses are more in line with the
Company's philosophy of growth. Candidates considered are
located within the Company's geographical area. Proceeds from
the sale of MBM will leave a significant surplus of equity for
these future acquisitions.
o The uncertainty about the immediate collection of loans
receivable discussed in Notes 8 and 14.
o The Company's immediate need to receive cash to close its
future acquisitions without any further dilution of common
shareholders at the current stock prices. Whereas alternative
financing commitments for the these future acquisition are in
place, the dilution results are not in the shareholders best
interest.
o After one year of experience with the overview of MBM,
management of the Company concluded that the operations of MBM
are not sufficiently compatible and synergetic with HBI, ALG
and DF.
o The offers received for the sale of MBM far outweigh any
benefits to be derived from its retention.
16
<PAGE>
Audited financial statements for the companies acquired or to be acquired along
with pro forma consolidated financial statements for the Company and the
acquired subsidiaries were presented through individual filings or as Exhibits
to this report.
Information relative to the disposal of MBM will be presented in an 8-K
immediately after documents for the sale are signed. Furthermore, the Company
will be filing 8-K reports within five (5) days of this report with respect to
the acquisitions of Hairbiotech, Inc., Alternative Lending Group and Direct
Financial, LLC.
Issuance of Preferred Stock Options
- -----------------------------------
During July 1999, 1274328 Ontario issued to Luis Alvarez - CEO, an
irrevocable option to purchase the Company's 4 million preferred shares for
$310,400.
During October 1999, the Company's Board of Directors ratified
management's previous decision to decrease the conversion rate of the authorized
preferred stock. The rate in effect at the time of the meeting was 100 common
shares for each share of preferred stock. The new authorized conversion rate is
27 shares of common stock per each share of preferred stock leaving control in
the public's hands where it belongs, and thus not compromising the tax loss
carryforward.
During February 2000, the Company issued the preferred shares and is
holding them during the "Exercise Period," subject to the Irrevocable Option
Agreement between 1274328 Ontario, Inc. and Mr. Luis Alvarez. The "Exercise
Period" expires July 30, 2001. Mr. Alvarez is free to exercise said options at
any time prior to the expiration date.
17
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------------------------------------------------------------------------
RESULTS OF OPERATIONS
- ---------------------
THIS QUARTERLY REPORT ON FORM 10-QSB CONTAINS CERTAIN "FORWARD-LOOKING
STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND SECTION 21F OF THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED (THE "EXCHANGE ACT"). SPECIFICALLY, ALL STATEMENTS OTHER
THAN STATEMENTS OF HISTORICAL FACTS INCLUDED IN THIS REPORT REGARDING THE
COMPANY'S FINANCIAL POSITION, BUSINESS STRATEGY AND PLANS AND OBJECTIVES OF
MANAGEMENT OF THE COMPANY FOR FUTURE OPERATIONS ARE FORWARD-LOOKING STATEMENTS.
THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF THE COMPANY'S
MANAGEMENT, AS WELL AS ASSUMPTIONS MADE BY AND INFORMATION CURRENTLY AVAILABLE
TO THE COMPANY'S MANAGEMENT. WHEN USED IN THIS REPORT, THE WORDS "ANTICIPATE,"
"BELIEVE," "ESTIMATE," "EXPECT" AND "INTEND" AND WORDS OR PHRASES OF SIMILAR
IMPORT AS THEY RELATE TO THE COMPANY OR COMPANY'S MANAGEMENT, ARE INTENDED TO
IDENTIFY FORWARD-LOOKING STATEMENTS. SUCH STATEMENTS REFLECT THE CURRENT VIEW OF
THE COMPANY WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO CERTAIN RISKS,
UNCERTAINTIES AND ASSUMPTIONS RELATED TO CERTAIN FACTORS INCLUDING, WITHOUT
LIMITATIONS, COMPETITIVE FACTORS, GENERAL ECONOMIC CONDITIONS, CUSTOMER
RELATIONS, RELATIONSHIPS WITH VENDORS, THE INTEREST RATE ENVIRONMENT, COST OF
CAPITAL, GOVERNMENTAL REGULATION AND SUPERVISION, CHANGES IN INDUSTRY PRACTICES,
DISRUPTIONS ASSOCIATED WITH EXPANSION, ONE-TIME EVENTS AND OTHER FACTORS
DESCRIBED HEREIN. ALTHOUGH THE COMPANY BELIEVES THAT THE EXPECTATIONS ARE
REASONABLE, IT CAN GIVE NO ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO BE
CORRECT. BASED UPON CHANGING CONDITIONS, SHOULD ANY ONE OR MORE OF THESE RISKS
OR UNCERTAINTIES MATERIALIZE, OR SHOULD ANY UNDERLYING ASSUMPTIONS PROVE
INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE DESCRIBED HEREIN AS
ANTICIPATED, BELIEVED, ESTIMATED, EXPECTED OR INTENDED. ALL SUBSEQUENT WRITTEN
AND ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY OR PERSONS
ACTING ON ITS BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE APPLICABLE
CAUTIONARY STATEMENTS.
MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS
- -----------------------------------------------------------
PLAN OF OPERATIONS
- ------------------
During the year ended September 30, 1999, the Company focused its
resources in the effort to successfully carry out the objectives approved by the
Bankruptcy Court in the Company's Chapter XI Bankruptcy Reorganization Plan. For
fiscal year 1999-2000 the Company's objectives for growth are as follows:
The Company continued to oversee the operations of MBM, which was the
Company's only operating subsidiary during the quarter ended December 31, 1999
and was an integral part of operations for the quarter ended March 31, 2000. The
Company evaluated in the course of the prior year whether the operations of MBM
were sufficiently compatible and synergetic with planned acquisition candidates.
Management determined that these operations were not complementary, and is
currently negotiating the sale or other disposition of MBM and its operations.
The Company's plan for growth during the prior fiscal year included the
acquisitions of MBM and Hairbiotech. The details of these acquisitions were
discussed in "Recent Developments" in Part I, Item 1 of Form 10-KSB for the year
ended September 30, 1999. Results of operations of MBM are discussed below.
HBI will continue its research and development relative to the
prevention of hair loss in conjunction with the University of Miami School of
Medicine. The Company and HBI are currently negotiating with multinational
industry leaders for the funding of clinical trials and ongoing research.
The Company expects that upon execution of an Option Agreement, a
leading pharmaceutical company will be responsible for funding 100% of
Hairbiotech's Phase III human clinical trials and ongoing research, as well as
supplying adequate bulk topical compound needed to complete the study. The term
of the study will commence within 30 days of the FDA's acceptance of the
application. Per the agreement, Hairbiotech is not required to pay for any of
the research or costs associated with the product. The pharmaceutical company
will furnish Hairbiotech with $1,200,000 in milestone payments. In exchange for
the pharmaceutical company's patronage, Hairbiotech will grant it an option to
acquire an exclusive worldwide license to the patent and all applications of the
study. The pharmaceutical company will utilize its resources to manufacture,
market and sell the product(s) and submit associated reports to Hairbiotech.
Upon commercialization, the pharmaceutical company is obligated to document
sales of the product(s) and submit royalty payments to Hairbiotech. The
pharmaceutical company began conducting its first set of preliminary tests in
February.
To achieve this growth and obtain the necessary working capital, the
Company will require additional funding. The Company has received working
capital funds for ALG and further preliminary commitments from investors to
arrange for future funding of additional acquisitions. However, the Company does
not want to further dilute the ownership interest of the common shareholders.
Additionally, the imminent collection of loans receivable as part of the MBM
Stock Purchase Agreement approved by the Bankruptcy Court or from the actual
sale of MBM is expected to provide cash and capital for other acquisitions.
While the Company has reason to expect the completion of these arrangements in
the near future, no assurances can be given that such funds will be available.
18
<PAGE>
Because of the Company's vision relative to shareholders control and
the uncertainty relative to MBM loans, the Company is currently negotiating the
sale or other disposition of MBM and its operations to meet future cash flow
requirements.
The Company recently acquired 100% of the common stock of Alternative
Lending Group ("ALG") and all its related assets. The Company's President and
CEO is currently studying several other acquisitions.
The Alternative Lending Group Acquisition
The Company recently closed an agreement to purchase 100% of the common
stock of Alternative Lending Group ("ALG") and all its related assets.
In just six years, ALG grew from a single-city mortgage company based
in Chicago - with $38 million first-year gross business - to a mortgage bank
covering nine states, (23 states, subsequent to the closing) with $93,592,399 in
actual 1999 gross mortgage loans originated and closed. The company focused its
mortgage origination through a consumer direct marketing channel and maintained
steady growth and profitability by providing mortgage loans to fit all types of
consumers' needs. With the added control that mortgage banking status provides,
ALG is able to make loans simultaneously profitable and competitive because of
the reduction in sales commissions and expenses associated with conventional
mortgage brokerage firms.
ALG recently created two new divisions: the Wholesale Division and the
Internet Online Mortgage Division. These divisions will help establish the
company's national presence and substantially increase gross production over the
next 12 months.
Mortgage financing has traditionally been a lengthy ordeal, lasting
weeks or sometimes even months. ALG offers the convenience of applying for all
types of loans via the Internet. ALG has utilized the Internet as a referral
source for the past three years, and has maintained a $2 million monthly average
loan volume from its previous website. The company has spent much of the past 12
months developing a new website, Alternativelending.com, and a new business plan
for the Internet Online Mortgage Division.
With the launch of its website in January, Alternativelending.com, ALG
plans to increase its market focus from the current 23 states to nationwide,
during the next 12 months. Alternativelending.com intends to become the place to
shop online for a home loan. ALG will continue its Internet marketing strategy
direct to customers and will compete directly with current online leaders E-loan
and Mortgage.com to provide a low cost mortgage option to all customers
regardless of credit history.
19
<PAGE>
Alternativelending.com allows customers to find a product, choose the
rate and costs they want, and apply for a loan, all in about 10 minutes and from
the comfort of their home computer. This feature allows ALG to have more control
over its Internet Online Mortgage loans, since they make the determination to
approve the customer or supply them with alternative loan products to meet their
needs. With other sites, those customers will simply be approved or denied.
ALG is now a mortgage bank and will have more flexibility with pricing,
underwriting, closing times/locations and customer communication. ALG will
continue to provide more hands-on service to customers who request it, through
its traditional offices located in the Midwest and Southwest regions.
With the addition of ALG's Wholesale Division, the company will not
only be marketing its Internet Online Mortgages, but also its mortgage banking
services to other mortgage brokers. The Wholesale Division has allowed ALG to
make every loan more profitable, thus allowing improved customer service and
more competitive rates, costs and closing times.
The Direct Financial LLC Acquisition
On March 23, 2000, Alternative Lending Group, a wholly owned subsidiary of
Whitehall Enterprises, Inc., entered into an agreement to purchase Direct
Financial, LLC, a Michigan Limited Liability Company and the interests of James
P. Mack, Wallace W. Qualls, III, Greg Kitchen, and Kip W. Weston (collectively,
the "Members"). The Members' agreed to sell and transfer to Alternative Lending
Group all their Members' interests in Direct Financial, LLC. Whitehall
Enterprises, Inc. agreed, in consideration of the sale and transfer of the
Members' interests to Alternative Lending Group, to issue to the Members' shares
of common stock of Whitehall. The following table summarizes the more
significant terms of the agreement:
* Whitehall Enterprises, Inc. issued two million one hundred twenty-five
thousand (2,125,000) shares of their common stock for the purchase of
Direct Financial, LLC.
* The Members own all the outstanding Members' interest in Direct
Financial, LLC.
* Whitehall Enterprises, Inc. agreed that in the event that James P. Mack
or William W. Qualls become entitled to an additional 187,500 shares
each of Whitehall's common stock, pursuant to their Employment
Agreement, Whitehall will upon receipt of written notification to that
effect from Alternative Lending Group, issue and deliver to Mack and
Qualls each 187,500 additional shares of Whitehall Enterprises, Inc.
common shares.
* Direct Financial, LLC and the Members represented that they are not a
party to or bound by any agreement of guarantee, indemnification,
surety, or similar commitments of the obligations, liabilities
(contingent or otherwise) or indebtedness of any other person,
corporation or partnership, except for trade accounts payable incurred
in the normal course of operations.
20
<PAGE>
* Direct Financial, LLC and Members have executed all necessary documents
holding Whitehall Enterprises, Inc. harmless of any liability pursuant
to the stock purchase agreement.
Since its formation Direct Financial LLC and Members have operated as a mortgage
broker/lender in Southfield, Michigan. Direct Financial's current gross loan
origination volume is between $10-12 million per month. As a result of the
acquisition of Direct Financial, LLC, Alternative Lending Group will increase
its annual gross mortgage originations from $93.3 million to approximately $250
million. With Direct Financial's two Michigan locations and an expanded retail
staff it will immediately enhance Alternative Lending Group's East Coast
presence and double their retail origination staff. Direct Financial's average
gross loan amount is almost double that of Alternative Lending Group's due to
their geographical location. This acquisition is just the next step in Whitehall
Enterprises' plan to expand Alternative Lending Group's state-of-the art Web
site presence, as well as accelerate the growth of Alternative Lending Group's
Internet, Retail and Wholesale Divisions.
RESULTS OF OPERATIONS
- ---------------------
The Company's operations consists of the operations of MBM and ALG.
Because DF was acquired in late March 2000, its operations are not a significant
part of the financial statements.
MBM revenues consist of sales of finished inventory to customers. Cost
of inventory sold includes the purchased cost of raw materials, direct labor,
packaging and direct factory overhead.
Revenues from sales for the six and three month periods ended March 31,
2000, were $2,714,778 and $1,350,477 representing a steady performance since the
acquisition of MBM in November 30, 1998. MBM sales for the same quarter in 1999
was $1,395,864. Corresponding cost of sales for the same six and three month
periods ended in March 31, 2000 were $2,105,109 and $1,021,603. The gross margin
for the six and three month period ended March 31, 2000 was 22.44% and 24.3%,
compared to 21.3% for the year ended September 30, 1999 and 24.02% and 26.73%
for the same periods a year ago.
ALG revenues consist of loan origination fees. Revenues for the quarter
ended March 31, 2000 amounted to $452,193 compared to $2,133,237 for the year
ended December 31, 1999.
General and administrative expenses, exclusive of stock options of
$463,000 issued to directors and non employees for services rendered, amounted
to $1,206,218 or 44% of sales for the six month period ended on March 31, 2000.
Total general and administrative expenses for the six and three months ended
March 31, 2000 were $1,669,218 and $954,744.
21
<PAGE>
Interest expense of $108,052 were incurred on loans due to the Royal
Bank of Canada and warehouse lines of credit during the period ended March 31,
2000.
The Company's consolidated net loss for the six and three months ended
March 31, 2000 amounted to $(721,099) and $(248,977) compared to net income of
$48,319 and $38,531 the preceding period of operations ended March 31, 1999. Net
losses exclusive of expenses paid through stock options issued to directors and
non employees for services rendered aggregating $463,000, would become a net
loss of $(258,099) for the six month period ended March 31, 2000. ALG's net loss
for the quarter ended March 31, 2000 was $(212,275). The losses in ALG were
related to the introduction and roll out of AlternativeLending.com in this
quarter. As a result, ALG experienced many one-time expenses related to
research, development, upstart Internet marketing fees, and technology upgrades
that will not be incurred again. Whitehall management made a conscious decision
to incur all start up expenses in this quarter, thus ensuring ALG to immediately
service its projected customer base and report a substantial profit for next
quarter.
In addition, ALG also incurred several expenses directly related to the
acquisition of DF that were not offset by revenues. Now that the consolidation
is complete and barring any unforeseen operational and/or industry changes, ALG
expects revenues to increase by approximately 300% in the next quarter. This is
consistent with the results already achieved in April, which in turn are a
direct result of the start up investments made in this quarter.
Since the roll out of AlternativeLending.com, ALG has been able to
increase our consumer traffic by over 300% and begin to rely on our Internet web
site to supply the bulk of our mortgage leads. This will not only have a
positive effect on our marketing costs in the second quarter, but is also the
next step in utilizing the Internet and our web site to generate 100% of our
retail mortgage leads.
During the October 22, 1999 Board of Directors Meeting, Luis Alvarez,
CEO, introduced a discussion regarding his initial commitment to the Board when
he set forth the challenge they would be faced with and their acceptance of
their positions as directors. Note 4 in the financial statements discusses the
options approved by the Board.
22
<PAGE>
PART II.
ITEM 1. LEGAL PROCEEDINGS
For information concerning current litigation regarding the Company,
see Note 5 in the Notes to Financial Statements.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
SIGNIFICANT SUBSEQUENT EVENTS:
The C & M Oil Company, Inc. Transaction
On June 12, 1999, the Company signed a letter of intent to acquire C &
M Oil Company, Inc., ("CMO") a Florida corporation. On February 17,
2000, the Company and CMO executed a stock purchase agreement for 100%
of the shares of CMO. On May 11, 2000, acquisition negotiations were
terminated as conditions relative to the transaction's success were not
deemed in the best interest of the Company.
The Planned Disposition of MBM
The Company is currently negotiating an agreement to sell its ownership
interest in MBM. The proceeds from the sale will be utilized to meet
the cash flow necessary to finance other acquisitions. The following
conditions were considered in moving forward with the decision to sell
MBM.
o 129 Ontario's failure to comply with its responsibilities as
delineated by an agreement between the Company and 129 Ontario
and its inability to produce necessary documentation in a
timely manner.
o The sale of MBM will provide sufficient cash to acquire other
financial service industry companies and biotechnology
companies. These businesses are more in line with the
Company's philosophy of growth. Candidates considered are
located within the Company's geographical area. Proceeds from
the sale of MBM will leave a significant surplus of equity for
these future acquisitions.
23
<PAGE>
o The uncertainty about the immediate collection of loans
receivable discussed in Notes 8 and 14.
o The Company's immediate need to receive cash to close its
future acquisitions without any further dilution of common
shareholders at the current stock prices. Whereas alternative
financing commitments for the these future acquisition are in
place, the dilution results are not in the shareholders best
interest.
o After one year of experience with the overview of MBM,
management of the Company concluded that the operations of MBM
are not sufficiently compatible and synergetic with HBI, ALG
and DF.
o The offers received for the sale of MBM far outweigh any
benefits to be derived from its retention.
Information relative to the disposal of MBM will be presented
in an 8-K immediately after documents for the sale are signed.
Furthermore, the company will be filing 8-K's within five (5)
days with respect to the acquisition of Hairbiotech, Inc.
Alternative Lending Group and Direct Financial LLC.
Issuance of Preferred Stock Options
During July 1999, 1274328 Ontario issued to Luis Alvarez -
CEO, an irrevocable option to purchase the Company's 4 million
preferred shares for $310,400.
During October 1999, the Company's Board of Directors ratified
management's previous decision to decrease the conversion rate
of the authorized preferred stock. The rate in effect at the
time of the meeting was 100 common shares for each share of
preferred stock. The new authorized conversion rate is 27
shares of common stock per each share of preferred stock
leaving control in the public's hands where it belongs, and
thus not compromising the tax loss carryforward.
During February 2000, the Company issued the preferred shares
and is holding them during the "Exercise Period," subject to
the Irrevocable Option Agreement between 1274328 Ontario, Inc.
and Mr. Luis Alvarez. The "Exercise Period" expires July 30,
2001. Mr. Alvarez is free to exercise said options at any time
prior to the expiration date.
24
<PAGE>
On August 11, 1999 the Company's common stock was listed for
inclusion in the OTC Bulletin Board and continues to utilize
the symbol "WTHL".
ITEM 6. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
- ---------------------------------------------------------------------------
Audited financial statements of ALG as of and for the
year ended December 31, 1999 and 1998 were provided in Form
8-K within five (5) days of this report.
Pro-forma combined financial data of the Company and
ALG will be provided in Form 8-K within five (5) days of this
report.
Audited financial statements of DF as of and for the
year ended December 31, 1999 and 1998 will be provided in Form
8-K within five (5) days of this report.
Pro-forma combined financial data of the Company and
DF will be provided in Form 8-K within five (5) days of this
report.
Details of the sale of MBM will be available through
an 8-K as soon as the transaction is closed.
(b) The Company filed Form 8-K reports dated May 18, 2000,
February 10, 1999, May 10, 1999 and June 16, 1999.
(c) Exhibits
None
25
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned as a duly authorized officer and as the chief financial officer of
the Registrant.
WHITEHALL ENTERPRISES, INC.
FORMERLY KNOWN AS
TOTAL WORLD TELECOMMUNICATIONS, INC.
(Registrant)
Date: February 22, 2000 By:/s/ Luis Alvarez
----------------
Luis Alvarez, President
26
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<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-01-1999
<PERIOD-END> MAR-31-2000
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