U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
( X ) REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 2000
Commission file number: 33-55254-46
AMERICAN SPORTS HISTORY INCORPORATED
(Exact name of small business issuer as specified in its charter)
Nevada 87-0485307
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
21 Maple Avenue, Bay Shore, New York 11706-8752
(Address of principal executive offices)
(631) 206-2674
Issuer's telephone number, including area code
Not applicable
(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 ( )
As of August 16, 2000, the issuer had 12,942,272 shares of
its common stock issued and outstanding.
Transitional Small Business Disclosure Format: Yes ( ) No ( X )
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
FORM 10-QSB - JUNE 30, 2000
INDEX
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2000 and December 31, 1999 1
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three and six months ended June 30, 2000 and 1999
and cumulative from May 1, 1995 2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2000 and 1999
and cumulative from May 1, 1995 3
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 4 - 8
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION 9 - 10
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS 11
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K 11
SIGNATURES 12
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2000 1999
(Unaudited)
ASSETS
Current assets
Cash $ 409,872 $ 228
Prepaid expenses 36,750 6,250
Total current assets 446,622 6,478
Website development costs 121,277
Other assets 56,285 9,984
$ 624,184 $ 16,462
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued
expenses $ 520,106 $ 507,382
Customer deposits 100,699 -
Notes payable to officers - 174,548
Notes payable and accrued interest 57,598 615,785
Liability from settlement of lawsuit 95,000 120,000
Total current liabilities 773,403 1,417,715
Liability from settlement of lawsuits,
non-current 25,000 25,000
Notes payable to director 288,682 274,771
Notes payable to officers 179,048 -
Notes payable and accrued interest 1,574,075 -
Total liabilities 2,840,208 1,717,486
Commitments and contingencies
Stockholders' deficit
Common stock, $.001 par value;
25,000,000 shares authorized,
9,436,026 and 9,466,026 shares
issued and outstanding, respectively 9,436 9,466
Additional paid-in capital 2,982,351 2,313,479
Accumulated deficit
($5,123,414 accumulated during the
development stage) (5,207,811) (3,971,469)
Unearned compensation - (52,500)
Total stockholders' deficit (2,216,024) (1,701,024)
$ 624,184 $ 16,462
See notes to condensed consolidated financial statements.
1
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Cumulative
Three months ended Six months ended from
June 30, June 30, May 1, 1995
2000 1999 2000 1999 1995
<S> <C> <C> <C> <C> <C>
Revenue $ 21,755 $ - $ 21,755 $ - $ 21,755
Expenses
Product development 53,606 291,000 117,433 371,000 584,141
General and administrative 870,805 238,757 1,140,664 379,617 4,301,672
Lawsuit settlements - - - - 178,500
Write-off of advances for
terminated acquisition - - - - 80,856
924,411 529,757 1,258,097 750,617 5,145,169
Net loss $ (902,656) $ (529,757) $(1,236,342) $(750,617) $(5,123,414)
Basic and diluted net
loss per share $ (0.10) $ (0.05) $ (0.13) $ (0.08)
Weighted average number
of common shares
outstanding 9,465,367 10,201,081 9,464,707 9,974,811
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended June 30, Cumulative
2000 1999 1995
<S> <C> <C> <C>
INCREASE (DECREASE) IN CASH
Cash flows from operating activities
Net loss $ (1,236,342) $ (750,617) $ (5,123,414)
Adjustments to reconcile net loss to
Net cash used in operating activities
Write-off of prepaid royalty - - 137,500
Depreciation and amortization 1,629 733 7,208
Write-off of deposit - - 30,000
Impairment of goodwill - - 14,437
Common stock issued for partial
settlement of lawsuit - - 6,000
Stock options issued to non-
employees for service 80,874 36,000 165,290
Common stock and options issued to
employees for service 631,650 102,750 1,708,452
Imputed interest on notes
payable to officers 8,818 - 19,270
- -
Changes in assets and liabilities
Prepaid expenses (30,500) (22,440) (33,308)
Other assets (44,829) - (49,829)
Liability from settlement of lawsuits (25,000) - 142,500
Accounts payable and accrued expenses (5,946) 23,135 452,058
Customer deposits 100,699 - 100,699
Loan from director - 132,632 402,541
Accrued interest 21,469 4,454 54,733
----------- --------- ----------
Net cash used in operating activities (497,478) (473,353) (1,965,863)
Cash flows from investing activities
Website development costs (121,277) - (121,277)
Purchase of equipment and domain name (3,101) (8,500) (13,101)
----------- --------- -----------
Net cash provided by investing activities (124,378) (8,500) (134,378)
Cash flows from financing activities
Proceeds from issuance of notes to officers 4,500 108,408
Proceeds from issuance of notes 1,052,500 443,500 1,649,400
Repayment of notes (25,500) (28,500) (92,000)
Loans from director - 3,385 120,441
Issuance of common stock - - 630,964
Liability from sale of common
Stock rescinded - - 22,260
----------- --------- -----------
Net cash provided by financing activities 1,031,500 526,793 2,510,113
----------- --------- -----------
Net increase in cash 409,644 44,940 409,872
Cash, beginning of period 228 3,344 -
Cash, end of period $ 409,872 $ 48,284 $ 409,872
------------ ------------ -----------
------------ ------------ -----------
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
1 Basis of presentation and management's plan
The Company was incorporated in the State of Nevada on
August 9, 1990 as National Logistics, Inc. National
Logistics, Inc. changed its name to Fans Holdings, Inc. on
June 30, 1995, and subsequently to American Sports History
Incorporated ("AMSH" or the "Company") on September 20,
1995. On August 21, 1995, AMSH acquired 100% of the capital
stock of Infinet, Inc. ("Infinet"). For accounting purposes,
the acquisition of Infinet by AMSH has been treated as a
recapitalization of Infinet, with Infinet as the acquirer
(reverse acquisition). AMSH had no assets or operations
prior to May 1995. In the second quarter 2000, the
Company's newly formed subsidiary, American Sports Academy,
LLC ("ASA"), assumed the operations of the Bud Harrelson
Baseball and Softball Academy (Note 5). Although the Company
has incurred a significant amount of start-up costs, since
the Company has generated only minimal revenue from
operations, it is still considered to be in the development
stage.
The Company incurred a net loss of $1,236,342 for the six
months ended June 30, 2000, resulting in an accumulated
deficit of $5,207,811. Management of the Company is
continuing to develop a business plan summarizing its
strategy for the next several years. This plan is now
focused on providing U.S. sports and educational content
utilizing all available technologies of the Internet, media,
advanced telecommunications and storage technologies. Under
this plan, significant cash will be required through
December 2000 to pay off current debt and fund its
implementation. The intention is to raise capital through
the sale of its equity securities and/or to seek outside
private sources of financing. In connection with this, the
Company issued $1,052,500 in non-interest bearing promissory
notes to various parties during the first six months of 2000
(see Note 7 for information on the subsequent conversion of
the debt to equity). Significant additional cash will be
required.
There can be no assurances that the Company will be
successful in its attempts to raise sufficient capital
essential to its survival. To the extent, the Company is
unable to raise the necessary operating capital, it will not
be able to implement its business plan, and it will become
necessary to curtail or cease operations. Additionally, even
if the Company does raise sufficient operating capital,
there can be no assurances that the net proceeds will be
sufficient enough to enable it to develop its business to a
level where it will generate profits and cash flows from
operations.
These matters raise substantial doubt about the Company's
ability to continue as a going concern. However, the
accompanying consolidated financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and satisfaction of liabilities in the
normal course of business. The financial statements do not
include any adjustments relating to the recoverability of
the recorded assets or the classification of the liabilities
that might be necessary should the Company be unable to
continue as a going concern.
4
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
2 Significant accounting policies
Interim financial information
The condensed consolidated balance sheet as of June 30,
2000, and the condensed consolidated statements of
operations and cash flows for the periods ended June 30,
2000 and 1999 and cumulative from May 1, 1995, have been
prepared by the Company without audit. These interim
financial statements include all adjustments, consisting
only of normal recurring accruals, which management
considers necessary for a fair presentation of the financial
statements for the above periods. The results of operations
for the six months ended June 30, 2000, are not necessarily
indicative of results that may be expected for any other
interim periods or for the full year.
These condensed consolidated financial statements should be
read in conjunction with the consolidated financial
statements and notes thereto for the year ended December 31,
1999. The accounting policies used in preparing the
condensed consolidated financial statements are consistent
with those described in the December 31, 1999 consolidated
financial statements.
Principles of consolidation
The consolidated financial statements include the accounts
of the Company and its wholly owned subsidiaries. All
significant intercompany transactions and balances have been
eliminated in consolidation.
Stock options
Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123")
establishes a fair value-based method of accounting for
stock compensation plans. The Company has chosen to adopt
the disclosure requirements of SFAS 123 and continue to
record stock compensation for its employees in accordance
with Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" ("APB 25"). Under APB 25,
charges are made to operations in accounting for stock
options granted to employees when the option exercise prices
are below the fair market value of the common stock at the
grant date. Options granted to non-employees are recorded
in accordance with SFAS 123.
Use of estimates
In preparing condensed consolidated financial statements in
conformity with generally accepted accounting principles,
management makes estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures
of contingent assets and liabilities at the date of the
condensed consolidated financial statements, as well as the
reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those
estimates.
Revenue recognition
Revenue currently consists of fees earned from participants
in the Company's sports camps. Revenue is recognized at the
time the sports instructional services are provided. Cash
received in advance of the instructional services is
reflected as customer deposits in the accompanying
consolidated balance sheet. As of June 30, 2000 customer
deposits totaled $100,699.
5
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
2 Significant accounting policies (continued)
Website development costs
Statement of Position 98-1, "Accounting for the Costs of
Computer Software Developed For or Obtained For Internal
Use" ("SOP 98-1") requires capitalization of certain costs
incurred in the development of the core software for the
Company's website infrastructure. Costs incurred in the
development of content for the Company's website and
maintenance are expensed as incurred. During the six months
ended June 30, 2000, the Company capitalized approximately
$121,000 in costs associated with the development of its
website infrastructure and charged $75,000 to operations.
Reclassifications
Certain reclassifications have been made to the condensed
consolidated financial statements shown for the prior
periods in order to conform to the current period's
classifications.
3 Transactions with related parties
Notes payable to officers
Notes payable to officers, totaling $179,048 at June 30,
2000, represent advances made by two of the Company's
officers to be used for working capital purposes. These
advances are non-interest bearing and had no scheduled
repayment terms. Interest expense, at an annual rate of 10%,
has been imputed on these notes and reflected as additional
paid-in capital. On August 14, 2000, these notes were
converted into 358,096 shares of the Company's common stock
and accordingly, the notes payable are reflected as non-
current liabilities in the accompanying consolidated balance
sheet as of June 30, 2000 (Note 7).
Notes payable to director
Notes payable to director ($288,682 at June 30, 2000)
includes notes payable to the Company's Chairman of the
Board ($194,823) and his spouse ($93,859). These notes are
non-interest bearing with a face amount aggregating
$370,441, and are payable in full on December 31, 2002.
Accordingly, interest expense, at an annual rate of 10%, has
been imputed on these notes.
4 Notes payable and accrued interest
Notes payable and accrued interest, totaling $1,631,673 at
June 30, 2000 represent demand loans made to the Company by
various investors as well as amounts owed to certain vendors
which were converted to formal notes. $1,454,698 of these
notes are non-interest bearing and $176,975 of these notes
bear interest at rates ranging from 7% to 10% per annum. On
August 14, 2000, $1,574,075 of these notes were converted
into 3,148,150 shares of the Company's common stock and
accordingly, the notes payable are reflected as non-current
liabilities in the accompanying consolidated balance sheet
as of June 30, 2000 (Note 7).
6
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
5 Stock and option transactions
Stock options
In June 2000, the Company granted bonuses to three officers
of the Company for services performed. The bonuses were paid
with immediately vested options to acquire an aggregate of
1,000,000 shares of the Company's common stock at an
exercise price of $.20 per share. The Company recorded a
charge to operations of $518,000 in the second quarter 2000,
based upon the intrinsic value of the options at the grant
date. Also, in lieu of cash compensation, two of these
officers were granted additional options to acquire an
aggregate of 600,000 shares of the Company's common stock at
an exercise price of $.20 per share. These options vest
ratably over the 1-year service period from 4/16/00 to
4/15/01 The Company recorded a charge to operations of
$64,750 in the second quarter 2000, based upon the $311,000
intrinsic value of the options at the grant date.
In June 2000, the Company granted three members of its
Advisory Board options to acquire an aggregate of 125,000
shares of the Company's common stock at an exercise price of
$1.00 per share. These options vest in 1 year. The Company
valued the options at $89,750 (calculated using the Black-
Scholes option pricing model) and recorded a charge to
operations of $5,720 in the second quarter 2000.
Next Generation Networks Technology, Inc. and Kenneth O.
Roko
Effective November 18, 1998, the Company entered into a
business and consulting services agreement with Next
Generation Networks Technology, Inc. ("NGN"). In connection
with the agreement, Kenneth O. Roko, NGN's Chief Executive
Officer, was to serve as an officer and a member of the
Company's Board of Directors and assist in the
implementation of the Company's technological strategies in
order to establish the Company as a major contributor and
presence on the Internet. As compensation to NGN and Mr.
Roko, the Company issued 200,000 shares of its common stock
to NGN, 60,000 shares of common stock to Mr. Roko and also
granted 1,200,000 stock options to NGN with an exercise
price of $.12 per share. The Company was also obligated to
pay $50,000 cash to NGN, upon completion of the Company's
strategic business plan.
On June 27, 2000, the Company entered into separation
agreements with both NGN and Mr. Roko. Key conditions of the
separation agreements are as follows: 1) the Company remains
obligated to NGN for $50,000, payable in 10 equal bi-monthly
installments of $5,000, 2) of the 1,200,000 stock options
previously granted to NGN, only 400,000 options actually
vested, 3) Mr. Roko surrendered 30,000 shares of common
stock previously issued to him, and 4) the Company is
obligated to pay $25,000 in cash to Mr. Roko.
American Sports Academy, LLC ("ASA")
In May 2000, the Company's newly formed subsidiary, ASA,
assumed the operations of the Buddy Harrelson Baseball and
Softball Academy ("BHBSA"). Revenue and expenses related to
the Company's operation of the sports camps have been
included in the Company's financial results since that date.
One of the Company's officers/directors is a co-owner of the
BHBSA. The Company has verbally agreed to compensate the
owners of the BHBSA with a combination of Company stock and
options based upon the future performance of ASA. Since the
parties have not yet determined the consideration to be paid
to BHBSA, no consideration has been reflected in the
accompanying financial statements.
7
<PAGE>
AMERICAN SPORTS HISTORY INCORPORATED AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
6 Commitments and contingencies
Legal proceedings
On June 30, 1996, a default judgment was entered against
Infinet, the Company's wholly owned subsidiary, and certain
of the Company's principal stockholders by a former
shareholder of Fans Publishing Inc., alleging breach of
contractual commitments and other matters. Effective October
14, 1997, on behalf of himself and the Company, Mr. Nerlino
entered into a settlement agreement that required the
Company to pay $100,000 in cash and to issue 225,000 shares
of its common stock. As a result, the Company recorded a
charge to operations of $122,500 in 1997. The $100,000 is
payable, without interest, in two installments: $5,000
within 120 days of the agreement and $95,000 by October 14,
2000. The common stock was to be issued within 30 days of
the effective date of the agreement. Since the first cash
installment was paid in November 1998 and the common stock
was issued in June 1998, the Company became in default of
the agreement. Should any legal action be initiated against
the Company due to its late payment default, the Company
will vigorously defend itself.
On August 2, 1996, the Company became a defendant in a case
involving one of its current stockholders. The stockholder
was seeking a refund of approximately $200,000, the original
amount invested in the Company's common stock. On November
2, 1998, the Company entered into a settlement agreement
with the stockholder. Pursuant to the agreement, the Company
issued 50,000 shares of its common stock to the stockholder
in 1998 and paid $25,000 in May 2000. The Company is also
obligated to pay $25,000 in November 2001.
The Company is delinquent in paying many of its outstanding
debts and has been notified by several creditors that they
have already initiated or may pursue legal remedies. The
Company believes that all amounts are appropriately accrued
in its financial statements. Since the Company does not
currently have the financial resources to satisfy these
debts, it intends to negotiate settlements with its
creditors in the near term. It is not possible to predict
the ultimate outcome of these matters.
7 Subsequent events
On August 14, 2000, the Company completed a private
offering, where holders of the Company's notes payable were
allowed to exchange their notes for Company common stock at
a fixed exchange rate of $.50 per share. The Company
converted a total of $1,753,123 of notes payable ($1,574,075
of notes and $179,048 of the loans from officers) into
3,506,246 restricted shares of the Company's common stock.
This transaction, which will be reflected in the third
quarter 2000, will have the effect of reducing total
liabilities by $1,753,123 with a corresponding decrease to
stockholders' deficit.
8
<PAGE>
ITEM II - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
Forward-looking statements
This Form 10-QSB includes, without limitation, certain
statements containing the words "believes", "anticipates",
"estimates", and words of a similar nature, constitute
"forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. This Act
provides a "safe harbor" for forward-looking statements to
encourage companies to provide prospective information about
themselves so long as they identify these statements as
forward looking and provide meaningful, cautionary
statements identifying important factors that could cause
actual results to differ from the projected results. All
statements other than statements of historical fact made in
this Form 10-QSB are forward-looking. In particular, the
statements herein regarding industry prospects and future
results of operations or financial position are forward-
looking statements. Forward-looking statements reflect
management's current expectations and are inherently
uncertain. The Company's actual results may differ
significantly from management's expectations.
Overview
In May 2000, the Company's newly formed subsidiary, American
Sports Academy, LLC ("ASA"), led by the Company's
officer/director and former member of the Baltimore Orioles
and New York Mets, Rob Dromerhauser, assumed operations of
the Bud Harrelson Baseball and Softball Academy. Existing
camps in five sports (baseball, softball, soccer, wrestling
and lacrosse) are now offered for children ages 5-15 with
further expansion planned. The Company believes that ASA
will provide an on-going revenue stream and a solid
foundation on which to build for the future. Although the
Company has incurred significant start-up costs, since the
Company has generated only minimal revenue from operations,
the Company is still considered to be in the development
stages.
The Company is continuing to develop its new Website,
Sportsinfo.com. The Company plans to use Sportsinfo.com to
deliver sports instruction and related information by
utilizing an e-commerce model and proprietary technologies.
Results of operations
During the quarter ended June 30, 2000, the Company began to
generate revenue from the American Sports Academy sports
camp operations. Revenue for the quarter ended June 30,
2000 was $21,755. In addition, customer deposits totaling
$100,699 were received from participants in ASA's sports
camps to be operated in the third quarter.
During the quarter ended June 30, 2000 and June 30, 1999,
general and administrative expenses were $870,805 and
$238,757, respectively. Cumulative from May 1, 1995, the
Company has incurred $4,301,672 of general and
administrative expenses. Product development expenses were
incurred during the quarter ended June 30, 2000 and 1999
totaling $117,433 and 371,000, respectively. Cumulative from
May 1, 1995, the Company has incurred $584,141 of product
development expenses. Additionally, During the six months
ended June 30, 2000, the Company capitalized approximately
$121,000 in costs associated with the development of
infrastructure for its new Website, Sportsinfo.com.
During the quarters ended June 30, 2000 and 1999, the
Company incurred net losses of $924,411 and $529,757,
respectively. During the six months ended June 30, 2000 and
1999, the Company incurred net losses of $1,236,342 and
$750,617, respectively. The six-month results include non-
cash charges related to stock and option compensation
approximating $713,000 and $139,000, respectively.
9
<PAGE>
As of June 30, 2000 and 1999, the Company was a development
stage company that had generated only minimal revenue from
operations. The Company expects to incur continuing general
and administrative expenses, without significant
commensurate operating revenue, until such time as it is
able to commence significant revenue-generating operations.
The generation of revenue will be dependent upon the Company
raising substantial working capital from the sales of equity
securities and or obtaining funds from loan proceeds, and
American Sports Academy operating revenue. There can be no
assurances, however, that the Company will ultimately be
successful in raising the necessary capital and in
establishing itself as a sports information and services
provider.
Liquidity and capital resources
The Company incurred a net loss of $1,236,342 for the six
months ended June 30, 2000, resulting in an accumulated
deficit of $5,207,811. Management of the Company is
developing a business plan summarizing its strategy for the
next several years. This plan is now focused on providing
U.S. sports and educational content utilizing all available
technologies of the Internet, media, advanced
telecommunications and storage technologies. Under this
plan, significant cash will be required through December
2000 to pay off current debt and fund its implementation.
The intention is to raise capital through the sale of its
equity securities and/or to seek outside private sources of
financing. In connection with this, the Company issued
approximately $1,052,500 (net of $25,500 in note repayments)
in non-interest bearing promissory notes to various parties
during the first six months of 2000 (see below for
information on the subsequent conversion of the debt to
equity). Significant additional cash will be required.
There can be no assurances that the Company will be
successful in its attempts to raise sufficient capital
essential to its survival. To the extent the Company is
unable to raise the necessary operating capital, it will not
be able to implement its business plan, and it will become
necessary to curtail or cease operations. Additionally, even
if the Company does raise sufficient operating capital,
there can be no assurances that the net proceeds will be
sufficient enough to enable it to develop its business to a
level where it will generate profits and cash flows from
operations. These matters raise substantial doubt about the
Company's ability to continue as a going concern.
The Company currently has seven full-time employees. In
addition, there are seasonal part-time employees in the
American Sports Academy operations. In the business plan,
it is contemplated that additional employees will be added
as funding permits. Management of the Company intends to
sustain operations during the year ending December 31, 2000,
with the cash resources generated by the continuing sale of
common stock, issuance of stock for services, and through
management's ability to control discretionary expenditures.
The Company intends to continue to offer common stock or
options to officers, employees and consultants for services
rendered to conserve working capital.
On August 14, 2000, the Company completed a private
offering, where holders of the Company's notes payable were
allowed to exchange their notes for Company common stock at
a fixed exchange rate of $.50 per share. The Company
converted a total of $1,753,123 of notes payable ($1,574,075
of notes and $179,048 of the loans from officers) into
3,506,246 restricted shares of the Company's common stock.
This transaction, which will be reflected in the third
quarter 2000, will have the effect of reducing total
liabilities by $1,753,123 with a corresponding decrease to
stockholders' deficit.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
See Note 4 to Condensed Consolidated Financial
Statements "Commitments and Contingencies."
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a)Exhibits: Included only with the electronic filing of
this report is the Financial Data Schedule for the six-
month period ended June 30, 2000 (Exhibit Ref. No. 27).
(b)Reports on Form 8-K: None.
11
<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.
AMERICAN SPORTS HISTORY INCORPORATED
Date: August 16, 2000 By:/s/ HERBERT J. HEFKE
Herbert J. Hefke
President and Chief
Executive Officer
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