SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended February 29, 2000
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 000-28729
INFE.COM, INC.
----------
(Exact name of registrant as specified in its charter)
FLORIDA 11-3144463
----------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8000 Towers Crescent Drive #640 22182
Vienna, VA ----------
------------------------------------- (Zip Code)
(Address of principal executive offices)
(703) 734-5650
--------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No __________
---------
Number of shares outstanding of the issuer's common stock, as of
February 29, 2000
Common Stock, par value $.0001 per share 9,756,030
-------------------------------------- -----------
Class Number of shares outstanding
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Page 1
<PAGE>
INFE.COM, INC.
FORM 10-QSB
INDEX
Page
Number
- ------ ----
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheet 3
February 29, 2000
Statements of Operations 4
Three months ended February 29, 2000
and February 28, 1999
Statements of Cash Flows 5
Three months ended February 29, 2000
and February 28, 1999
6-7
Notes to Interim Financial Statements
Item 2. Management's Discussion and Analysis of Financial 8-9
Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures
About Market Risk 9
Part II. OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 2. Changes in Securities and Use of Proceeds 9
Item 4. Submission of Matters to a Vote of Security Holders 9
Item 6. Exhibits and Report on Form 8-K 9
SIGNATURE 9
EXHIBIT INDEX 9
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<PAGE>
PART I FINANCIAL INFORMATION
- ----------------------------
Item 1. Financial Statements
--------------------
INFE.COM, INC.
BALANCE SHEET
FEBRUARY 29, 2000
(Unaudited)
February 29,
2000
ASSETS
CURRENT ASSETS:
Cash $ 105,672
Certificate of deposit - restricted 50,000
Trade accounts receivable, net 68,292
Investments 7,500
Note receivable 25,000
Accrued interest receivable 612
Prepaid expenses 5,084
---------------
Total current assets 262,160
PROPERTY AND EQUIPMENT, net 22,072
OTHER ASSETS:
Software development costs 38,010
Deferred costs 25,000
Deposits 6,028
---------------
Total other assets 69,038
---------------
$ 353,270
===============
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Line of credit - bank $ 45,000
Note payable 12,245
Capital lease obligation 4,850
Accounts payable and accrued expenses 116,487
Loan payable - shareholder 30,599
---------------
Total current liabilities 209,181
OTHER LIABILITIES:
Capital lease obligation 2,306
Liability for stock to be issued 246,122
---------------
Total other liabilities 248,428
---------------
TOTAL LIABILITIES 457,609
COMMITMENTS AND CONTINGENCIES -
STOCKHOLDERS' DEFICIT:
Common stock, $.0001 par value; 20,000,000
shares authorized; 9,756,030 shares issued
and outstanding 975
Additional paid-in capital 1,771,081
Accumulated deficit (1,876,395)
---------------
Total stockholders' deficit (104,339)
---------------
$ 353,270
===============
The accompanying notes are an integral part of these financial statements.
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<PAGE>
INFE.COM, INC.
STATEMENTS OF OPERATIONS
THREE MONTHS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999
(unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended
February 29, 2000 February 28, 1999
----------------- -----------------
<S> <C> <C>
REVENUE $ 102,533 $ 22,740
COST OF REVENUES 56,640 28,304
----------------- -----------------
Gross profit 45,893 (5,564)
OPERATING EXPENSES 442,725 190,362
----------------- -----------------
Loss from operations (396,832) (195,926)
OTHER (INCOME) EXPENSES:
Depreciation and amortization 2,174 1,847
Unrealized holding losses on
investments 2,679 -
Interest income (612) (2,407)
----------------- -----------------
Interest expense 1,048 286
Total other (income)
expenses
----------------- -----------------
5,289 (274)
----------------- -----------------
NET LOSS $ (402,121) $ (195,652)
================= =================
Net loss per common share (basic) $ (0.04) $ (0.03)
================= =================
Weighted average number of common
shares outstanding 9,542,463 7,255,263
================= =================
Net loss per common share (diluted) $ (0.04) $ (0.03)
================= =================
Weighted average number of common
shares outstanding 9,542,463 7,255,263
================= =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
INFE.COM, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999
(unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended
February 29, 2000 February 28, 1999
----------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (402,121) $ (195,652)
Adjustments to reconcile net
loss to net cash used in
operating activities:
Depreciation 2,174 1,847
Unrealized holding losses
on investments 2,679 -
Stock issued in lieu of cash
for professional services 119,777 119,175
Stock to be issued in lieu of
cash for professional services 61,122 -
Changes in assets and liabilities
affecting operations:
Trade accounts receivable, net (35,412) (11,035)
Accrued interest receivable (612) -
Prepaid expenses (5,084) -
Accounts payable and accrued
expenses (6,471) 48,781
----------------- -----------------
Net cash used in operating activities (263,948) (36,884)
----------------- -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of investments (10,179) -
Payments received from
(issuance of) note receivable (25,000) 48,438
Payments of capital lease
obligation (1,411) (1,918)
Investment in software
development costs - (14,499)
----------------- -----------------
Net cash provided by
(used in) investing
activities (36,590) 32,021
----------------- -----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of
note payable - 669
Proceeds (repayments) from
loans from shareholder, net (11,017) 108
Proceeds received for stock
to be issued 185,000 -
Net proceeds from issuance of
common stock 115,000 -
----------------- -----------------
Net cash provided by
financing activities 288,983 777
----------------- -----------------
NET CHANGE IN CASH (11,555) (4,086)
CASH, BEGINNING OF PERIOD 117,227 4,086
----------------- -----------------
CASH, END OF PERIOD $ 105,672 $ -
================= =================
SUPPLEMENTAL DISCLOSURE:
Interest paid during period $ 1,048 $ 286
================= =================
NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Financed acquisition of
equipment $ - $ 11,576
================= =================
Stock issued as a reduction to the
liability for stock to be issued $ 309,280 $ -
================= =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
FEBRUARY 29, 2000
(unaudited)
A. BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and
Item 310 (b) of Regulation S-B. 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 (consisting of normal
recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three months ended February
29, 2000 and February 28, 1999 are not necessarily indicative of the
results that may be expected for the year ended November 30, 2000.
For further information, refer to the financial statements and
footnotes thereto included in the Company's Form 10-SB/A filed on
January 25, 2000.
B. ORGANIZATION
INFe.com, formerly Infocall Communications Corporation (the "Company"),
was incorporated in the State of Florida on February 1, 1993. The
Company is engaged in the operations of providing various human
resources and financial consulting services to the technology industry
in the Washington D.C. metropolitan area and to a broader market using
the Internet.
C. INVESTMENTS
In accordance with SFAS No. 115, "Accounting for Certain Debt and
Equity Securities", securities are classified into three categories:
held-to-maturity, available-for-sale and trading. Because the Company
is holding the securities principally for the purpose of selling them
in the near future, they are classified on the balance sheet as
trading securities. As a result, the securities are carried at fair
value. At February 29, 2000, the cost of the investments was $10,179.
D. NOTE RECEIVABLE
The Company has an unsecured convertible subordinated debenture dated
January 2000 in the original amount of $25,000 with interest payable
quarterly at an interest rate of 12% per annum, maturing in one year
from the date of the note. The debenture is convertible at any time
at the holder's option into shares of the borrowing company's corporate
stock.
E. LIABILITY FOR STOCK TO BE ISSUED
The amount due of $246,122 at February 29, 2000 represents stock to
be issued to individuals in which the Company has received payment
and stock to be issued to individuals for services rendered during
the period.
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<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
FEBRUARY 29, 2000
CONTINUED
(unaudited)
F. RELATED PARTY TRANSACTIONS
The President of the Company has loaned the Company money to fund
current operations. At February 29, 2000, the Company was indebted
to the President for $30,599.
The President of the Company was compensated for services rendered
during the period ended February 29, 2000 by the granting of 62,500
shares of the Company's Rule 144 common stock. As of February 29,
2000, the stock has not been issued but is included in the liability
for stock to be issued, see Note E.
G. NET LOSS PER COMMON SHARE
As required by SFAS No. 128, the following is a reconciliation of the
basic and diluted EPS calculations for the periods presented:
<TABLE>
<CAPTION>
February 29, February 28,
2000 1999
------------ ------------
<S> <C> <C>
Net loss (numerator) $ (402,121) $ (195,652)
Weighted average share
(denominator) 9,542,463 7,255,263
Basic net loss per share $ (.04) $ (.03)
Dilutive shares
(denominator) 9,542,463 7,255,263
Diluted net loss per share $ (.04) $ (.03)
</TABLE>
As required by the Securities and Exchange Commission (SEC) Staff
Accounting Bulletin No. 98, the above calculation of EPS is based on
SFAS No. 128, "Earnings Per Share." Thus, 830,000 purchase warrants
granted as of February 29, 2000 are not included in the calculation
of diluted EPS as their inclusion would be anti-dilutive. No purchase
warrants were granted during the year ended February 28, 1999. In
addition, the Company is liable to issue 455,400 shares of common stock
related to cash received and services rendered for the three months
ended February 29, 2000.
H. SUBSEQUENT EVENTS
In March 2000, the Company amended and restated their Articles of
Incorporation. The Company's amendments were to change the name of the
Company to INFE.com, Inc. and to increase the number of authorized
shares to 100,000,000 shares of common stock and 20,000,000 shares of
preferred stock.
On April 11, 2000, the Company entered into an agreement with
ClubComputer.com, Inc. ("ClubComputer") to acquire their assets for
approximately $2 million. ClubComputer is an e-commerce business on
the Internet supplying computer and related products to member
subscribers. The Company will do so by issuing 250,000 shares of the
Company's common stock immediately; and issuing the Company's common
stock in seven (7) equal quarterly installments valued at $250,000
each.
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<PAGE>
Item 2. Managements Discussion and Analysis of Financial Condition and
---------------------------------------------------------------
Results of Operations
---------------------
INFE.COM, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The matters discussed in this report contain forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
and Section 27A of the Securities Act of 1933, as amended, that involve risks
and uncertainties. All statements other than statements of historical
information provided herein may be deemed to be forward-looking statements.
Without limiting the foregoing, the words "believes", "anticipates", "plans",
"expects" and similar expressions are intended to identify forward-looking
statements. Factors that could cause actual results to differ materially from
those reflected in the forward-looking statements include, but are not limited
to, those discussed in this section and elsewhere in this report, the risks
discussed in the "Risk Factors and Cautionary Statements" section included in
the Company's Registration Statement on Form 10SB12G filed with the SEC on
December 30, 1999, and the risks discussed in the Company's other filings with
the SEC. Readers are cautioned not to place undue reliance on these forward-
looking statements, which reflect management's analysis, judgment, belief or
expectation only as of the date hereof. The Company undertakes no obligation
to publicly revise these forward-looking statements to reflect events or
circumstances that arise after the date hereof.
Basis of Presentation
Certain amounts for prior periods in the accompanying financial statements,
and in the discussion below have been reclassified to conform with current
period presentations.
Three months ended February 29, 2000 compared to three months ended February
28, 1999
Revenues for the quarter ended February 29, 2000 increased $79,793, or
351%, to $102,533 from $22,740 for the quarter ended February 28, 1999.
The increase was largely attributable to an increase of $49,793 in
revenues for the IT*CareerNet.com division. The Company believes that its
operating divisions will continue to develop revenues. Additionally, on
April 11, 2000 the Company entered into an agreement with ClubComputer.com,
Inc. (ClubComputer") to acquire their assets for approximately $2 million.
ClubComputer is an e-commerce business on the internet supplying computer and
related products to member subscribers. The Company also expects to acquire a
professional employer organization, "PEO", in the second quarter of this year
to provide additional revenue sources. These acquisitions remain subject to
customary closing conditions, including regulatory approval and target company
stockholder approval. Therefore, as a result of both increased revenues by
existing divisions, and revenues from new acquisitions, the Company expects to
report future revenue growth.
Cost of revenues increased $28,336, or 100%, to $56,640 in the first
quarter of fiscal 2000 from $28,304 for the corresponding period in fiscal
1999. The cost of revenues increased primarily as a result of higher revenues.
Cost of revenues as a percentage of revenues decreased to 55% in the first
quarter of fiscal 2000 from 124% in the same period during the prior year,
primarily as a result of improved margin percentages.
Operating expenses increased $252,363, or 133%, to $442,725 in the
quarter ended February 29, 2000, from $190,362 for the period ended February
28, 1999. This increase in operating expenses is primarily a result of
expanding the Company's management team in preparation for future growth.
These expenses consist primarily of compensation, rent and professional
services fees.
Other expenses for the quarter ended February 29, 2000 were $5,289, and
$(274) for the quarter ended February 28, 1999. This increase is due
primarily to an increase of $2,679 in unrealized holding losses on investments.
On December 13, 1999, the Company raised $300,000 in additional
working capital in exchange for 600,000 shares of restricted, (Rule 144(A)),
common stock.
The Company believes that its existing capital resources together with
cash flow from operations and ongoing fund raising efforts will be sufficient
to meet its short-term operating expenses and capital requirements. However,
the Company's long-term capital requirements will depend upon many factors,
some of which are beyond the control of the Company.
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<PAGE>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
----------------------------------------------------------
None to report.
PART II OTHER INFORMATION
- -------------------------
Item 1. Legal Proceedings
-----------------
The Company is subject to claims and lawsuits that arise primarily in the
ordinary course of business. It is the opinion of management that the
disposition or ultimate resolution of such claims and lawsuits will not have
a material adverse effect on the financial position of the Company.
Item 2. Changes in Securities and Use of Proceeds
-----------------------------------------
Not Applicable
Item 3. Defaults Upon Senior Securities
-------------------------------
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
Not Applicable
Item 5. Other Information
-----------------
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibit No. Exhibit Name
----------- ------------
3(i) Certificate of Incorporation 1
(b) Reports on Form 8-K
-------------------
The Company, on April 4, 2000 filed on form 8-K information,
pursuant to Item 5, "Other Events" supplying the required information
regarding the Company's name change and adoption of amended and restated
articles of incorporation. These changes have been reflected in this form
10-QSB filing.
(c) Exhibit No Exhibit Name
---------- ------------
SIGNATURES
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 thereunto duly authorized.
INFE.COM, INC.
(Registrant)
Date: April 14, 2000 /s/ Tom Richfield
--------------------------------------
Tom Richfield (Duly Authorized Officer)
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<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Balance
Sheet, Statement of Operations, Statements of Cash Flows and Notes thereto
incorporated in this Form 10-QSB and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-2000
<PERIOD-START> DEC-01-1999
<PERIOD-END> FEB-29-2000
<CASH> 155,672
<SECURITIES> 7,500
<RECEIVABLES> 68,292
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 262,160
<PP&E> 43,055
<DEPRECIATION> (20,983)
<TOTAL-ASSETS> 353,270
<CURRENT-LIABILITIES> 209,181
<BONDS> 0
0
0
<COMMON> 1,772,056
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 353,270
<SALES> 102,533
<TOTAL-REVENUES> 102,533
<CGS> 56,640
<TOTAL-COSTS> 442,725
<OTHER-EXPENSES> 2,679
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,048
<INCOME-PRETAX> (402,121)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (402,121)
<EPS-BASIC> (0.04)
<EPS-DILUTED> (0.04)
</TABLE>
