[As adopted in Release No. 34-32231, April 28, 1993, 58 F.R. 26509]
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: September 30, 1997
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
Commission file number 0-18834
Klever Marketing, Inc.
(Exact name of small business issuer as
specified in its charter)
Delaware 36-3688583
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
350 West 30 South, Suite 201, Salt Lake City, Utah 84101
(Address of principal executive offices)
(801) 322-1221
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
for the past 90 days. Yes X No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING 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 No X
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 practical date:
September 30, 1997 9,699,775
Transitional Small Business Disclosure Format (check one).
Yes ; No X
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.
(A Development Stage Company)
BALANCE SHEET
(Unaudited)
September 30 December 31
ASSETS 1997 1996
Current Assets
Cash $ - $ 29,452
Employee Receivable 32,500 -
Shareholder Receivable 250 57,500
Total Current Assets 32,750 86,952
Fixed Assets
Equipment 56,438 52,262
Less Accumulated Depreciation (36,631) (29,225)
Net Fixed Assets 19,807 23,037
Other Assets
Patents 1,632,075 1,623,386
Organization Costs 152,662 152,662
Less Accumulated Amortization (962,000) (839,812)
Net Other Assets 822,737 936,236
Total Assets $ 875,294 $ 1,046,225
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable, Trade $ 131,885 $ 111,714
Accrued Liabilities 43,152 34,200
Checks Written in Excess of Cash 6,185 -
Related Party Payables 4,160 50,166
Lease Obligation 1,614 4,479
Total Current Liabilities 186,996 200,559
Other
Deferred Income 229,000 229,000
Notes Payable - Related Party 39,809 27,148
Total Other Liabilities 268,809 256,148
Total Liabilities 455,805 456,707
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
BALANCE SHEET
(Continued)
(Unaudited)
September 30 December 31
LIABILITIES AND STOCKHOLDERS' EQUITY 1997 1996
(Continued)
Stockholders' Equity
Preferred stock (par value $.01),
2,000,000 shares authorized.
-0- issued and outstanding $ - $ -
Common Stock (Par Value $.01),
20,000,000 shares authorized.
9,699,775 shares issued and out-
standing September 30, 1997 and
9,050,607 shares issued and out-
standing December 31, 1996 96,998 90,506
Common Stock to be issued 3,475 6,057
Paid in Capital in Excess of Par
Value 5,075,099 4,658,554
Retained Deficit (3,333,785) (3,333,785)
Deficit Accumulated During the
Development Stage (1,422,298) (831,814)
Total Stockholders' Equity 419,489 589,518
Total Liabilities and
Stockholders' Equity $ 875,294 $ 1,046,225
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
STATEMENT OF OPERATIONS
(Unaudited)
Cumulative
For the Three Months For the Nine Months During
September 30, September 30, Development
1997 1996 1997 1996 Stage
Revenue $ - $ - $ - $ - $ -
Total Revenue - - - - -
Expenses
General and
Administrative 264,024 135,344 536,240 406,033 1,077,617
Research and
Developmen 557 70,209 49,071 210,627 329,908
Total Expenses 264,581 205,553 585,311 616,660 1,407,525
Other Income (Expense)
Interest Income 31 - 31 - 31
Interest Expense (538) (2,375) (5,204) (7,125) (14,704)
(507) (2,375) (5,173) (7,125) (14,673)
Income (Loss)
Before Taxes (265,088) (207,928) (590,484) (623,785) (1,422,198)
Income Taxes - - - - 100
Net Income (Loss)
After Taxes $ (265,088) $ (207,928) $ (590,484) $ (623,785) $(1,422,298)
Weighted Average Shares
Outstanding 9,687,775 8,825,241 9,390,179 8,727,166
Loss Per Share $ (.03) $ (.02) $ (.06) $ (.07)
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
STATEMENT OF CASH FLOWS
(Unaudited
Cumulative
For the Nine Months Ended During
September 30, Development
1997 1996 Stage
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (590,484) $(623,785) $(1,422,298)
Adjustments used to reconcile
net loss to net cash provided
by (used in) operating activities:
Non cash general and administrative - 4,398 22,242
Decrease (Increase) in
employee receivable (32,500) - (32,500)
Increase (decrease) in
accounts payable 20,170 167,795 36,064
accrued liabilities 8,953 555 9,692
checks written in excess of cash 6,185 - 6,185
deferred income - 15,000 15,000
Depreciation and Amortization 129,594 120,464 290,213
Net Adjustment 132,402 308,212 346,896
Net cash used in operating activities (458,082) (315,573) (1,075,402)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of equipment (4,176) (3,600) (8,976)
Acquisition of patents (6,794) (3,023) (52,284)
Net cash used by investing activities (10,970) (6,623) (61,260)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds From Capital Stock Issued 418,560 $ 304,970 $1,107,196
Proceeds From Loans 55,000 25,000 88,500
Principle Payments on
Lease Obligations (2,865) (2,780) (6,572)
Shareholder Receivable 57,250 - 57,250
Related Party Payable (46,006) - (46,006)
Cash payments on notes payable (42,339) (34,406) (88,380)
Net Cash Provided by Financing
Activities 439,600 292,784 1,111,988
Net Increase (Decrease) in Cash
and Cash Equivalents (29,452) (29,412) (24,674)
Cash and Cash Equivalents at
Beginning of the Year 29,452 24,674 24,674
Cash and Cash Equivalents at
End of the Year $ - $ (4,738) $ -
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION:
Interest $ 5,885 $ 6,110 $ 14,032
Income Taxes $ - $ 100 $ 100
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(Unaudited)
1. Interim Reporting
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles and with Form 10-QSB
requirements. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
considered necessary for a fair presentation have been included. Operating
results for the nine month period ended September 30, 1997, are not
necessarily indicative of the results that may be expected for the year ended
December 31, 1997.
Item 2. Management's Discussion and Analysis or Plan of Operation.
General - This discussion should be read in conjunction with Management's
Discussion and Analysis of Financial Condition and Results of Operations in
the Company's annual report on Form 10-KSB for the year ended December 31,
1996.
Results of Operations - From December 8, 1993 to July 5, 1996 VideOcart,
Inc. was in Bankruptcy. On July 5, 1996 VideOcart, Inc. was reorganized,
changed its name to Klever Marketing, Inc. and became a development stage
company and has not begun principal operations.
Liquidity and Capital Resources
The Company requires working capital principally to fund its current
operations. From time to time in the past the Company has relied on
short-term borrowing and the issuance of restricted common stock to fund
current operations. There are no formal commitments from banks or other
lending sources for lines of credit or similar short-term borrowing, but the
Company has been able to borrow any additional working capital that has been
required. From time to time in the past, required short-term borrowing have
been obtained from a principal shareholder or other related entities.
The Company generates and uses cash flows through three activities:
operating, investing, and financing. During the nine months ended September
30, 1997, operating activities used cash of $458,000 as compared to net cash
used of $316,000 for the nine months ended September 30, 1996.
Cash flows used in investing activities is primarily due to the
acquisition of $11,000 and $7,000 of computer equipment and office furniture
and patents for the nine months ended September 30, 1997 and September 30,
1996.
Financing activities provided $440,000 and $293,000 for the nine months
ended September 30, 1997 and 1996. The increase in cash flow from financing
activities was primarily from the sale of common stock.
The Company may be required to supplement its available cash and other
liquid assets with proceeds from borrowing, the sale of additional securities,
or other sources. There can be no assurance that any such required additional
funding will be available or, if available, that it can be obtained on terms
favorable to the Company.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
The Company did not file a report on Form 8-K during the three months
ended September 30, 1997.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Klever Marketing, Inc.
(Registrant)
DATE: November 13, 1997 By: /s/
Paul G. Begum
Chief Executive officer & Director
(Principal financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET OF KLEVER MARKETING, INC. AS OF SEPTEMBER 30, 1997 AND THE RELATED
STATEMENTS OF OPERATIONS AND CASHFLOWS FOR THE THREE AND NINE MONTHS THEN ENDED
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
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