UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period ended: June 30, 2004
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to _____________
Commission file number 0-49972
Sports Information & Publishing Corp.
-------------------------------------
(Exact name of small business issuer as specified in its charter)
Colorado 84-1579760
- ------------------------------ ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1869 W. Littleton Boulevard, Littleton, Colorado 80120
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(Address of principal executive offices)
(303) 738-8994
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(Issuer's telephone number)
N/A
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 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 10, 2004, 5,020,000 shares of common stock were outstanding.
Transitional Small Business Disclosure Format:
Yes [ ] No [X]
SPORTS INFORMATION & PUBLISHING CORP.
Index Page
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheet (unaudited) at June 30, 2004 1
Condensed Statements of Operations (unaudited) for the three
and nine months ended June 30, 2004 and 2003 and for the period
from inception through June 30, 2004
Condensed Statements of Cash Flows (unaudited) for the nine months
ended June 30, 2004 and 2003 and for the period from inception
through June 30, 2004
Notes to Unaudited Condensed Financial Statements
Item 2. Management's Discussion and Analysis or Plan of Operation
Item 3. Controls and Procedures
Part II - OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities and Small Business Issuer
Purchases of Equity Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
i
SPORTS INFORMATION & PUBLISHING CORP.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEET
(UNAUDITED)
JUNE 30, 2004
ASSETS
Cash ................................................................ $ 14
=========
LIABILITIES AND SHAREHOLDERS' DEFICIT
Liabilities:
Accounts payable and accrued liabilities .......................... $ 13,741
Indebtedness to related party (Note 2) ............................ 13,690
---------
Total liabilities.......................................... 27,431
---------
Shareholders' deficit:
Preferred stock ................................................... --
Common stock ...................................................... 5,020
Additional paid-in capital ........................................ 164,100
Deficit accumulated during development stage ...................... (196,537)
---------
Total shareholders' deficit................................ (27,417)
---------
$ 14
=========
See accompanying notes to condensed financial statements.
1
SPORTS INFORMATION & PUBLISHING CORP.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
MARCH 1,
2001
THREE MONTHS ENDED NINE MONTHS ENDED (INCEPTION)
JUNE 30, JUNE 30, THROUGH
-------------------------- -------------------------- JUNE 30,
2004 2003 2004 2003 2004
----------- ----------- ----------- ----------- -----------
Revenue .......................... $ -- $ -- 341 $ 422 $ 988
----------- ----------- ----------- ----------- -----------
Expenses:
Cost of sales .................. -- -- 628 2,000 5,018
Stock-based compensation:
Organization costs and
services ................... -- -- -- -- 4,020
Salaries and payroll taxes ..... -- -- -- -- 38,682
Professional fees .............. 1,309 756 7,227 6,544 72,220
Web site wire service, hosting
and maintenance .............. 110 165 3,195 1,265 24,273
Rent ........................... -- -- -- -- 3,000
Contributed rent (Note 2) ...... 1,500 1,500 4,500 4,500 17,000
Contributed services (Note 2) .. 300 300 900 900 2,100
Amortization ................... -- -- -- 2,083 11,458
Interest expense ............... -- -- -- -- 146
Loss on web site impairment .... -- -- -- 13,542 13,542
Other .......................... 24 139 683 745 6,066
----------- ----------- ----------- ----------- -----------
Total expenses ........... 3,243 2,860 17,133 31,579 197,525
----------- ----------- ----------- ----------- -----------
Loss before income
taxes .................. (3,243) (2,860) (16,792) (31,157) (196,537)
Income tax provision (Note 3) .... -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Net loss ................. $ (3,243) $ (2,860) (16,792) $ (31,157) $ (196,537)
=========== =========== =========== =========== ===========
Basic and diluted loss per share . $ (0.00) $ -- $ (0.00) $ (0.01)
=========== =========== =========== ===========
Basic and diluted weighted average
common shares outstanding ...... 5,020,000 5,020,000 5,020,000 5,020,000
=========== =========== =========== ===========
See accompanying notes to condensed financial statements.
2
SPORTS INFORMATION & PUBLISHING CORP.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
MARCH 1,
2001
NINE MONTHS ENDED (INCEPTION)
JUNE 30, THROUGH
---------------------- JUNE 30,
2004 2003 2004
--------- --------- ---------
Net cash used in
operating activities ................... $ (12,120) $ (3,654) $(136,476)
--------- --------- ---------
Cash flows from investing activities:
Payment for web site development costs ................ -- -- (25,000)
--------- --------- ---------
Net cash used in
investing activities ................... -- -- (25,000)
--------- --------- ---------
Cash flows from financing activities:
Proceeds from promissory note issued to
an officer ......................................... -- -- 5,000
Repayment of promissory note issued to
an officer ......................................... -- -- (5,000)
Proceeds from advances received from
an officer (Note 2) ................................ 9,990 1,600 13,690
Working capital contributed by an affiliate ........... 1,800 1,250 2,800
Proceeds from the sale of common stock................. -- -- 150,000
Payments for offering costs ........................... -- -- (5,000)
--------- --------- ---------
Net cash provided by
financing activities ................... 11,790 2,850 161,490
--------- --------- ---------
Net change in cash ........................ (330) (804) 14
Cash, beginning of period ................................ 344 979 --
--------- --------- ---------
Cash, end of period....................................... $ 14 $ 175 $ 14
========= ========= =========
Supplemental disclosure of cash flow information:
Income taxes .......................................... $ -- $ -- $ --
========= ========= =========
Interest .............................................. $ -- $ -- $ 146
========= ========= =========
See accompanying notes to condensed financial statements.
3
SPORTS INFORMATION & PUBLISHING CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
(1) BASIS OF PRESENTATION
The financial statements presented herein have been prepared by the Company in
accordance with the rules for Form 10-QSB and the accounting policies in the
Company's Form 10-KSB for the year ended September 30, 2003, as filed with the
Securities and Exchange Commission, and should be read in conjunction with the
notes thereto.
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) which are necessary to provide a fair presentation of
operating results for the interim periods presented have been made. The results
of operations for the periods presented are not necessarily indicative of the
results to be expected for the year.
The Company is in the development stage in accordance with Statements of
Financial Accounting Standards (SFAS) No. 7 "Accounting and Reporting by
Development Stage Enterprises". As of June 30, 2004, the Company has devoted
substantially all of its efforts to financial planning, raising capital and
developing markets. On July 30, 2004, the Company closed a Share Exchange
Agreement with Hall Effect Medical Products, Inc., which resulted in a change in
control (see Note 4).
Financial data presented herein are unaudited.
(2) RELATED PARTY TRANSACTIONS
An officer contributed office space to the Company for the periods from March 1,
2001 (inception) through August 31, 2001 and from March 1, 2002 through June 30,
2004. The office space was valued at $500 per month based on the market rate in
the local area and is included in the accompanying financial statements as rent
expense with a corresponding credit to contributed capital.
An officer contributed administrative services to the Company valued at $300 and
$900, respectively, for the three and nine months ended June 30, 2004. The time
and effort was recorded in the accompanying financial statements based on the
prevailing rates for such services, which totaled $100 per month based on the
level of services performed. The services are reported as contributed services
with a corresponding credit to additional paid-in capital.
During the nine months ended June 30, 2004, the Company's president advanced the
Company $9,990 for working capital. The advances are non-interest bearing and
are due on demand. Advances owed to the president totaled $13,690 at June 30,
2004. The loans are included in the accompanying financial statements as
Indebtedness to Related Party.
(3) INCOME TAXES
The Company records its income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes". The Company incurred net operating losses during
all periods presented resulting in a deferred tax asset, which was fully allowed
for; therefore, the net benefit and expense resulted in $-0- income taxes.
(4) SUBSEQUENT EVENT - SHARE EXCHANGE AGREEMENT
On July 30, 2004, the Company acquired 100 percent of the capital stock of In
Vivo Medical Diagnostics Inc. ("In Vivo") (formerly known as Hall Effect Medical
Products Inc.), a Delaware corporation, in exchange for an aggregate of
34,343,662 shares of the Company's 4% voting preferred stock and 38,636,620
shares of the Company's common stock. As a result of the share exchange, In Vivo
became the Company's wholly-owned
SPORTS INFORMATION & PUBLISHING CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
subsidiary and changed its name from Hall Effect Medical Products Inc. to its
current name In Vivo Medical Diagnostics Inc.
In connection with the share exchange, the Company:
1. issued to the former shareholders of In Vivo, an aggregate of
34,343,662 shares of the Company's 4% voting redeemable convertible
preferred stock;
2. issued to the former shareholders of In Vivo, an aggregate of
38,636,620 shares of the Company's common stock;
3. issued 3,219,718 additional shares of the Company's common stock to
holders of $500,000 of promissory notes issued by In Vivo's wholly
owned subsidiaries Hall Effect Technologies Ltd. and Jopejo Ltd. in
exchange for the cancellation of such notes; which notes were
originally convertible into 750,000 shares of In Vivo common stock;
and
4. agreed to cause the resignation of all current members of the
Company's board of directors and appoint new directors as designated
by certain shareholders or affiliates of In Vivo.
Each full share of the Company's 4% preferred stock is convertible at any time
after October 31, 2005, at the option of the holder, into one full share of the
Company's common stock. The shares of 4% preferred stock vote, together with the
Company's outstanding common stock on an "as converted" basis, at any regular or
special meeting of the Company's stockholders called for the purpose of electing
directors of the Company or to vote on any other matter requiring shareholder
approval under Colorado corporate law. Assuming conversion of all of the
Company's shares of 4% preferred stock, the 76,200,000 shares of common stock
issued and issuable to the former security holders of In Vivo and its
subsidiaries represent approximately 88.4 percent of the Company's fully diluted
common stock.
The foregoing transaction constitutes a change in control of the Company.
Item 2. Management's Discussion and Analysis or Plan of Operation
Introduction
The following discussion and analysis covers the financial condition of
Sports Information & Publishing Corp. ("we" or the "Company") at June 30, 2004,
changes in our financial condition since fiscal year end September 30, 2003 and
a comparison of our results of operations for the three and nine months ended
June 30, 2004 to the same periods of the prior fiscal year. This information
should be read in conjunction with the other financial information, including
financial statements and notes, included in the Company's Form 10-KSB, as filed
with the United States Securities and Exchange Commission ("SEC").
As of the end of the period covered by this report, our business was the
operation of a web-based sports information publishing service. We published a
seasonal, weekly electronic football information service that covered college
and professional games and related information. This information was published
only during the football season, from approximately August to January of each
year. Basic information was provided to our subscribers at no cost and served as
potential inducement to subscribe for our premium service; we charged a fee for
more detailed information about selected games. As of the end of the period
covered by this report, our revenue has been insignificant and we were
considered to be in the development stage under relevant accounting principles.
On July 30, 2004, we acquired 100 percent of the capital stock of In Vivo
Medical Diagnostics Inc. ("In Vivo") (formerly known as Hall Effect Medical
Products Inc.), a Delaware corporation, in exchange for an aggregate of
34,343,662 shares of our 4% voting preferred stock and 38,636,620 shares of our
common stock. As a result of the share exchange, In Vivo became our wholly-owned
subsidiary and changed its name from Hall Effect Medical Products Inc. to its
current name In Vivo Medical Diagnostics Inc.
In Vivo is the sole owner of two companies incorporated under the laws of the
United Kingdom and based in Inverness, Scotland - Hall Effect Technologies Ltd.
("HET") and Jopejo Ltd. HET and Jopejo are developing a group of medical
diagnostic products for personal and professional use. These products are based
on technology that utilizes the "Hall Effect" phenomenon discovered over 100
years ago, for which In Vivo scientists are currently developing practical
applications. HET is in the final development stages of groundbreaking medical
devices for measuring levels of blood coagulation and other applications for the
cardio-vascular market. Other medical applications being addressed by HET's
patented technology include the measuring of blood sugar levels for the diabetes
market and other conditions where measuring and imaging is essential. HET has a
substantial patent portfolio relating to its technology. Jopejo has developed a
patented pregnancy monitoring technology, and is also in the late stages of
developing new and better monitoring devices that utilize signal processing for
the late-term pregnancy market.
Our common stock was accepted for quotation on the OTC Bulletin Board in the
quarter ended March 31, 2004. In our opinion, this will enhance our ability to
raise capital or expand our business operations.
Results of Operation
For the three months ended June 30, 2004, we reported a net loss of
$(3,243), or nil per share. This compares to a loss of $(2,860) for the three
months ended June 30, 2003. Results for the nine months ended June 30, 2004 and
2003 were a loss of $(16,792) and $(31,157), respectively. We had no revenue for
the quarters ended June 30, 2004 and March 31, 2004 and only negligible revenue
in the first quarter of 2004 and the first nine months of 2003. As of the end of
the period covered by this report, our revenue was dependent on the sale of our
premium information services to subscribers. Our business plan contemplated
marketing our service through e-mail contact to a database of potential
subscribers. Due primarily to our limited working capital, we were unable to
engage in any form of traditional marketing or advertising. Accordingly, our
revenue was insignificant. We were unable to predict with any degree of
certainty when this situation might change. Because the results of our business
plan had been disappointing, we evaluated our options to continue the business
and decided to acquire 100 percent of the capital stock of In Vivo, which was
consummated on July 30, 2004.
Our loss for the three months ended June 30, 2004 was increased by
approximately 113% from the comparable period of the prior fiscal year due to an
increase in expenses. Our loss for the nine months ended June 30, 2004 was
decreased by approximately 54% from the comparable period of the prior fiscal
year due to a decrease in expenses during the period. Professional fees and
website hosting expenses were increased from the third quarter of 2003 to the
corresponding period of 2004. The largest impact on expenses for the nine month
periods was the absence of any write-off in the first half of this year; in the
first half of last year, we wrote off the remaining investment in our web site
due to an evaluation of the recoverability of that asset. As a result,
amortization was reduced to zero in the first half of this year, as we had no
remaining intangible assets.
Our current plans as of the end of the period covered by this report was to
improve operations by raising more capital and expanding our database of
subscribers by acquiring additional names from a third party or exploring other
business opportunities. Management decided that it was in the best interests of
the shareholders that we acquire 100 percent of the capital stock of In Vivo,
which was consummated on July 30, 2004.
Liquidity and Capital Resources
We had substantially no liquidity and a working capital deficit at June 30, 2004
and were dependent on receipt of financing from outside sources and cash from
operations to continue as a going concern. Our working capital position
continued to deteriorate from fiscal year end 2003, totaling a deficit of
$(27,417) at June 30, 2004. That represents an increase of $11,392 since fiscal
2003 year end. Our operations did not provide any cash flow to pay our
liabilities, and our only capital was provided by advances from our President.
Prior to our share exchange with the security holders of In Vivo, we expected
this situation to continue until operations improved or we located additional
sources of financing. As a result of In Vivo becoming our wholly owned
subsidiary, we expect that our liquidity will improve as In Vivo introduces its
products into the
market. We cannot assure you, however, that In Vivo will provide the liquidity
and capital resources that we need.
As of the end of the period covered by this report, we were not a candidate for
debt financing due to our extremely limited operations, lack of cash flow and
assets. Historically, we relied on a single private placement of our common
stock and temporary financing from our officers for cash flow. We hope that our
status as a SEC-registered entity, the admission of our stock for quotation on
the OTCBB and our acquisition of In Vivo will facilitate additional equity
financing. However, we have no commitments for such financing, and none is
assured in the future.
Our limited cash at fiscal year end was reduced even more during the nine months
ended June 30, 2004. Our operating activities used $12,120 of cash for the nine
months ended June 30, 2004. Financing, in the form of loans by an affiliate,
provided $9,990 during the first nine months of 2004 to partially offset this
reduction. However, as of the end of the period covered by this report, we had
numerous accounts payable in arrears and no cash with which to pay them.
We will continue efforts to locate additional capital. We intend to rely on the
operations of our new wholly owned subsidiary In Vivo and contributions or
advances from our President to bridge our cash requirements for the remainder of
the current fiscal year.
Forward-Looking Statements
This Form 10-QSB contains or incorporates by reference "forward-looking
statements," as that term is used in federal securities laws, about our
financial condition, results of operations and business. These statements
include, among others: statements concerning the benefits that we expect will
result from our business activities and certain transactions that we contemplate
or have completed, such as receipt of working capital, increased revenues,
decreased expenses and avoided expenses and expenditures; and statements of our
expectations, beliefs, future plans and strategies, anticipated developments and
other matters that are not historical facts. These statements may be made
expressly in this document or may be incorporated by reference to other
documents that we will file with the SEC. You can find many of these statements
by looking for words such as "believes," "expects," "anticipates," "estimates"
or similar expressions used in this report or incorporated by reference in this
report. These forward-looking statements are subject to numerous assumptions,
risks and uncertainties that may cause our actual results to be materially
different from any future results expressed or implied by us in those
statements. Because the statements are subject to risks and uncertainties,
actual results may differ materially from those expressed or implied. We caution
you not to put undue reliance on these statements, which speak only as of the
date of this report. Further, the information contained in this document or
incorporated herein by reference is a statement of our present intention and is
based on present facts and assumptions, and may change at any time and without
notice, based on changes in such facts or assumptions. The important factors
that could prevent us from achieving our stated goals and objectives include,
but are not limited to, those set forth in our other reports filed with the SEC
and the following: the extent and duration of the current economic downturn,
especially in the Colorado market; our ability to raise additional capital, as
it may be affected by current conditions in the stock market and competition in
our industry for
risk capital; our costs and the pricing of our products and services; our
ability to identify, finance and integrate acquisitions; and volatility of our
stock price. We undertake no responsibility or obligation to update publicly
these forward-looking statements, but may do so in the future in written or oral
statements. Investors should take note of any future statements made by or on
our behalf.
Item 3. Controls and Procedures
(a) We maintain a system of controls and procedures designed to provide
reasonable assurance as to the reliability of the financial statements and other
disclosures included in this report. As of June 30, 2004, under the supervision
and with the participation of our Chief Executive Officer and Chief Financial
Officer, management has evaluated the effectiveness of the design and operation
of our disclosure controls and procedures. Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that our disclosure
controls and procedures were effective in timely alerting them to material
information required to be included in our periodic filings with the SEC.
(b) There were no changes in our internal control over financial
reporting that occurred during the quarter ended June 30, 2004 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.
PART II--OTHER INFORMATION
Item 1. Legal Proceedings
Not applicable.
Item 2. Changes in Securities and Small Business Issuer Purchases of Equity
Securities
Not applicable.
Item 3. DEFAULT 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) Exhibits: The following exhibits are filed with this report:
31.1 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the
Securities Exchange Act of 1934, as amended.
31.2 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the
Securities Exchange Act of 1934, as amended.
32 Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K.
Form 8-K filed with the Commission on July 14, 2004 containing a press
release announcing the agreement to acquire In Vivo Medical Diagnostics Inc.
("In Vivo") (formerly known as Hall Effect Medical Products Inc.)
Form 8-K filed with the Commission on August 10, 2004 containing in
Items 1, 2, 5 and 7 a discussion of the consummation of the acquisition In Vivo
Medical Diagnostics Inc. ("In Vivo") (formerly known as Hall Effect Medical
Products Inc.)
(The Remainder of This Page Was Intentionally Left Blank)
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, as
amended, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SPORTS INFORMATION & PUBLISHING CORP.
Date: August 23, 2004 By: /s/ Jonathan Fuller
------------------------------------
Jonathan Fuller,
Chief Executive Officer