FORM 10-QSB/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1
TO
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES ACT
OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002.
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO ________.
COMMISSION FILE NUMBER 333-61610
DATE OF REPORT: OCTOBER 30, 2002
WIZBANG TECHNOLOGIES INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
WASHINGTON 912061053
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
SUITE 679, 185 - 911 YATES STREET
VICTORIA, BRITISH COLUMBIA V8V 4Y9, CANADA
(250) 519-0553
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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
The number of outstanding shares of the issuer's common stock, $0.0001 par
value, as of September 30, 2002 was 10,100,000.
EXPLANATORY NOTE:
THIS AMENDMENT TO OUR QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTERLY PERIOD
ENDED SEPTEMBER 30, 2002 REFLECTS THE FOLLOWING CHANGES:
ITEM 1. FINANCIAL STATEMENTS
- -------------------------------
Note 2(h) Impact of Accounting Standards has been added
Note 3 License - has been changed to clarify the note payable terms and add
amortization disclosure
Note 4 Related Party Transactions - has added disclosure regarding the
relationship between Wizbang Technologies Inc.'s President and Reach
Technologies Inc.
Note 5 Restatement - The financial statements have been restated to reflect
previously unrecorded revenue and cost of goods sold.
ITEM 2. PLAN OF OPERATION
- -----------------------------
"Plan of Operation" has been replaced by a completely rewritten "Management's
Discussion and Analysis of Financial Condition and results of operations"
ITEM 5.CHANGES IN SECURITIES AND USE OF PROCEEDS
- -------------------------------------------------------
We have added this section and included the following information
1. "Recent Sales Of Unregistered Securities"
SIGNATURES
- ----------
This section now reflects signatures of the Chief Executive Officer and Chief
Financial Officer as well as sole director
WE HAVE MADE NO FURTHER CHANGES TO THE PREVIOUSLY FILED FORM 10-QSB. ALL
INFORMATION IN THIS 10-QSB/A IS AS OF SEPTEMBER 30, 2002 AND DOES NOT REFLECT,
UNLESS OTHERWISE NOTED, ANY SUBSEQUENT INFORMATION OR EVENTS OTHER THAN THE
AFOREMENTIONED CHANGES.
TABLE OF CONTENTS
PART I
Item 1. Financial Statements 1
Item 2. Management Discussion And Analysis of Financial
Condition and Results of Operations 8
PART II
Item 5. Changes in Securities and Use of Proceeds 12
Item 6 Exhibits and Reports on Form 8-K 13
Signatures 13
Certification 14
[This Space Has Been Intentionally Left Blank]
PART I
ITEM 1. FINANCIAL STATEMENTS
Unaudited Balance Sheet At September 30, 2002 And Audited Balance
Sheet at March31, 2002. . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Unaudited Statement Of Operations For The Six months ended
September 30, 2002 And 2001, For The Three months ended
September 30, 2002 And 2001, And For The Period September 22, 2000
(Date Of Inception) To September 30, 2002. . . . . . . . . . . . . . . . .2
Unaudited Statement Of Cash Flows For The Six months ended
September 30, 2002 And 2002 And For The Period September 22, 2000
(Date Of Inception) To September 30, 2002 . . . . . . . . . . . . . . . . . . .3
Notes To Unaudited Financial Statements . . . . . . . . . . . . . . . . . .4
[This Space Has Been Intentionally Left Blank]
Wizbang Technologies, Inc.
(A Development Stage Company)
Balance Sheets
(expressed in U.S. dollars)
September 30, March 31,
2002 2002
$ $
Restated
(unaudited) (audited)
ASSETS
Current Assets
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,081 36,148
Accounts Receivable . . . . . . . . . . . . . . . . . . . . . 12,500 -
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . 750 750
- -------------------------------------------------------------------------------------------
Total Current Assets . . . . . . . . . . . . . . . . . . . . . 35,331 36,898
- -------------------------------------------------------------------------------------------
License (Note 3)
Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,000 36,000
Accumulated amortization . . . . . . . . . . . . . . . . . . . 16,243 9,244
- -------------------------------------------------------------------------------------------
License - net. . . . . . . . . . . . . . . . . . . . . . . . . 49,757 26,756
- -------------------------------------------------------------------------------------------
Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . 85,088 63,654
===========================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . 8,371 -
Accrued liabilities (Note 4(b)). . . . . . . . . . . . . . . . 9,177 1,376
- -------------------------------------------------------------------------------------------
Total Current Liabilities. . . . . . . . . . . . . . . . . . . 17,548 1,376
- -------------------------------------------------------------------------------------------
Notes payable (Note 3) . . . . . . . . . . . . . . . . . . . . 32,163 10,114
- -------------------------------------------------------------------------------------------
Total Liabilities. . . . . . . . . . . . . . . . . . . . . . . 49,711 11,490
- -------------------------------------------------------------------------------------------
Stockholders' Equity
Common Stock: 100,000,000 common shares authorized with
a par value of $0.0001; 10,100,000 issued and outstanding. . . 1,010 1,010
Additional Paid-in Capital . . . . . . . . . . . . . . . . . . 74,990 74,990
Donated Capital (Note 4) . . . . . . . . . . . . . . . . . . . 18,750 18,750
- -------------------------------------------------------------------------------------------
94,750 94,750
- -------------------------------------------------------------------------------------------
Preferred Stock: 20,000,000 preferred shares authorized with
a par value of $.0001; none issued . . . . . . . . . . . . . . - -
- -------------------------------------------------------------------------------------------
Deficit Accumulated During the Development Stage . . . . . . . (59,373) (42,586)
- -------------------------------------------------------------------------------------------
Total Stockholders' Equity . . . . . . . . . . . . . . . . . . 35,377 52,164
- -------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity . . . . . . . . . . 85,088 63,654
===========================================================================================
Contingent Liability (Note 1)
The accompanying notes are an integral part of these financial statements
1
Wizbang Technologies, Inc.
(A Development Stage Company
Statement of Operations
(expressed in U.S. dollars)
(unaudited)
Accumulated from
September 22, 2000 Three Months Six Months
(Date of Inception) Ended Ended
to September 30, September 30, September 30,
2002 2002 2001 2002 2001
Restated Restated Restated
$ $ $ $ $
Revenue . . . . . . . . . . 35,400 12,500 22,900 12,500 22,900
Cost of Goods Sold. . . . . 25,650 8,350 17,300 8,350 17,300
- ----------------------------------------------------------------------------------------------------------
Gross Margin. . . . . . . . 9,750 4,150 5,600 4,150 5,600
- ----------------------------------------------------------------------------------------------------------
Expenses
Amortization of license . . 16,244 4,125 1,000 7,000 2,000
Bank charges and interest . 1,568 596 13 899 136
Consulting (Note 4) . . . . 25,141 3,000 3,000 6,000 6,000
Filing fees . . . . . . . . 4,392 - 1,150 1,133 2,150
Professional fees . . . . . 16,314 3,855 1,188 4,405 2,870
Rent (Note 4) . . . . . . . 6,000 750 750 1,500 1,500
Less interest income. . . . (536) - (276) - (350)
- ----------------------------------------------------------------------------------------------------------
Total Expenses. . . . . . . 69,123 12,326 6,825 20,937 14,306
- ----------------------------------------------------------------------------------------------------------
Net Loss for the Period . . (59,373) (8,176) (1,225) (16,787) (8,706)
==========================================================================================================
Net Loss Per Share - Basic. - - - -
==========================================================================================================
Weighted Average Shares
Outstanding . . . . . . . . 10,100,000 10,100,000 10,100,000 10,100,000
==========================================================================================================
(Diluted loss per share has not been presented as the result is anti-dilutive)
The accompanying notes are an integral part of these financial statements
2
Wizbang Technologies, Inc.
(A Development Stage Company
Statement of Cash Flows
(expressed in U.S. dollars)
(unaudited)
Accumulated from
September 22, 2000 Six Months
(Date of Inception) Ended
to September 30, September 30,
2002 2002 2001
Restated Restated
$ $ $
Cash Flows To Operating Activities
Net loss . . . . . . . . . . . . . . . . . . . . . . (59,373) (16,787) (8,706)
Adjustments to reconcile net loss to cash
Amortization . . . . . . . . . . . . . . . . . . . . 16,243 7,000 2,000
Donated consulting services. . . . . . . . . . . . . 15,000 - 6,000
Donated rent . . . . . . . . . . . . . . . . . . . . 3,750 - 1,500
Changes in non-cash working capital items
(Increase) in accounts receivable. . . . . . . . . . (12,500) (12,500) (22,900)
(Increase) in prepaid expenses . . . . . . . . . . . (750) - -
Increase in accounts payable and accrued liabilities 17,548 16,171 16,700
- -----------------------------------------------------------------------------------------------------
Net Cash Used In Operating Activities. . . . . . . . (20,082) (6,116) (5,406)
- -----------------------------------------------------------------------------------------------------
Cash Flows From (To) Financing Activities
Repayment of notes payable . . . . . . . . . . . . . (17,837) (7,951) -
Common shares issued . . . . . . . . . . . . . . . . 76,000 - -
- -----------------------------------------------------------------------------------------------------
Net Cash Provided By (Used In) Financing Activities. 58,163 (7,951) -
- -----------------------------------------------------------------------------------------------------
Cash Flows To Investing Activities
License purchased. . . . . . . . . . . . . . . . . . (16,000) - -
- -----------------------------------------------------------------------------------------------------
Cash Flows Used In Investing Activities. . . . . . . (16,000) - -
- -----------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Cash. . . . . . . . . . . 22,081 (14,067) (5,406)
Cash - Beginning of Period . . . . . . . . . . . . . - 36,148 53,474
- -----------------------------------------------------------------------------------------------------
Cash - End of Period . . . . . . . . . . . . . . . . 22,081 22,081 48,068
=====================================================================================================
Non-Cash Financing Activities
A license was purchased by issuing a promissory note 50,000 30,000 -
=====================================================================================================
Supplemental Disclosures
Interest paid. . . . . . . . . . . . . . . . . . . . - - -
Income taxes paid. . . . . . . . . . . . . . . . . . - - -
=====================================================================================================
The accompanying notes are an integral part of these financial statements
3
Wizbang Technologies Inc.
(A Development Stage Company)
Notes To Financial Statements
(Expressed in US Dollars)
(Unaudited)
_____________________________________________________________________
1. Development Stage Company
The Company was incorporated in the state of Washington on September 22,
2000. On September 22, 2000 the Company entered into a licensing agreement
with Reach Technologies, Inc., a Canadian Corporation. The agreement allows
the Company to sell a Digital Data Recorder product line in the north
central United States. The Company's principal business plan is to seek
immediate earnings by exploiting the license agreement with Reach
Technologies, Inc. The Company has started marketing the Digital Data
Recorder product line.
Planned principal activities have begun but significant revenues have not
been realized. The Company will continue to be in the development stage
until significant revenues begin. In a development stage company,
management devotes most of its activities in developing a market for its
products. The ability of the Company to emerge from the development stage
with respect to any planned principal business activity is dependent upon
its successful efforts to raise additional equity financing and/or attain
profitable operations. There is no guarantee that the Company will be able
to raise any equity financing or sell any of its products at a profit.
There is substantial doubt regarding the Company's ability to continue as a
going concern.
The Company has enough cash resources to meet ongoing operating expenses in
the short-term but will need to generate positive cash flow from operations
in the long-term and/or raise additional capital.
2. Summary of Significant Accounting Principles
a) Year End
The Company's fiscal year end is March 31.
b) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of
three months or less at the time of issuance to be cash equivalents.
c) License
The cost to acquire a license was capitalized. The costs will be amortized
on a straight-line basis over four years.
The carrying value of the License is evaluated in each reporting period to
determine if there were events or circumstances, which would indicate a
possible inability to recover the carrying amount. Such evaluation is based
on various analyses including assessing the Company's ability to bring the
commercial applications to market, related profitability projections and
undiscounted cash flows relating to each application which necessarily
involves significant management judgment. Where an impairment loss has been
determined the carrying amount is written-down to fair market value. Fair
market value is determined as the amount at which the license could be sold
in a current transaction between willing parties.
d) Revenue
Revenue from sales of the Digital Data Recorders will be recognized when
goods have been shipped and collectibility is reasonably certain.
4
2. Summary of Significant Accounting Principles (continued)
e) Basic Earnings (Loss) Per Share
Basic earnings (loss) per share have been calculated in conformity with
Financial Accounting Standards Board Statement No. 128 "Earnings per
Share". The Company has a simple capital structure without potential common
shares. Basic earnings (loss) per share is calculated on the weighted
average number of common shares outstanding each year.
f) Use of Estimates
The preparation of financial statements in conformity with U.S. 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. Actual results could differ from those
estimates.
g) Interim Financial Statements
These interim unaudited financial statements have been prepared on the same
basis as the annual financial statements and in the opinion of management,
reflect all adjustments, which include only normal recurring adjustments,
necessary to present fairly the Company's financial position, results of
operations and cash flows for the periods shown. The results of operations
for such periods are not necessarily indicative of the results expected for
a full year or for any future period.
h) Impact of Accounting Standards
On June 29, 2001, SFAS No. 141, "Business Combinations," was approved by
the Financial Accounting Standards Board. SFAS No. 141 requires that the
purchase method of accounting be used for all business combinations
initiated after June 30, 2001. Goodwill and certain intangible assets will
remain on the balance sheet and not be amortized. On an annual basis, and
when there is reason to suspect that their values have been diminished or
impaired, these assets must be tested for impairment, and write-downs may
be necessary. Wizbang Technologies Inc. implemented SFAS No. 141 on July 1,
2001 and its impact is not expected to be material on its financial
position or results of operations.
On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible Assets," was
approved by Financial Accounting Standards Board. SFAS No. 142 changes the
accounting for goodwill from an amortization method to an impairment-only
approach. Amortization of goodwill, including goodwill recorded in past
business combinations, will cease upon adoption of this statement. Wizbang
Technologies Inc. is required to implement SFAS No. 142 on April 1, 2002
and its impact, if any, is not expected to be material on its financial
position or results of operations as Wizbang Technologies Inc.'s license is
a finite license with a term of four years being the amortization period.
In June 2001, the Financial Accounting Standards Board issued SFAS No. 143,
"Accounting for Asset Retirement Obligation." SFAS No. 143 is effective for
fiscal years beginning after June 15, 2002, and will require companies to
record a liability for asset retirement obligations in the period in which
they are incurred, which typically could be upon completion or shortly
thereafter. The Financial Accounting Standards Board decided to limit the
scope to legal obligations and the liability will be recorded at fair
value. The effect of adoption of this standard on Wizbang Technologies
Inc.'s results of operations and financial positions is being evaluated.
5
In August 2001, the Financial Accounting Standards Board issued SFAS No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS
No. 144 is effective for fiscal years beginning after December 15, 2001. It
provides a single accounting model for long-lived assets to be disposed of
and replaces SFAS No. 121 "Accounting for the Impairment of Long-Lived
Assets and Long-Lived Assets to Be Disposed Of." Wizbang Technologies Inc.
adopted SFAS No. 144 on April 1, 2002. The effect of adoption of this
standard on Wizbang Technologies Inc.'s results of operations and financial
position is not expected to be material on its financial position or
results of operations.
In June, 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities". The provisions of this Statement are
effective for exit or disposal activities that are initiated after December
31, 2002, with early application encouraged. This Statement addresses
financial accounting and reporting for costs associated with exit or
disposal activities and nullifies Emerging Issues Task Force (EITF) Issue
No. 94-3, "Liability Recognition for Certain Employee Termination Benefits
and Other Costs to Exit an Activity (including Certain Costs Incurred in a
Restructuring)". This Statement requires that a liability for a cost
associated with an exit or disposal activity be recognized when the
liability is incurred. The Company will adopt SFAS No. 146 on January 1,
2003. The effect of adoption of this standard on the Company's results of
operations and financial position is not expected to be material.
FASB has also issued SFAS No. 145 and 147 but they will not have any
relationship to the operations of the Company therefore a description of
each and their respective impact on the Company's operations have not been
disclosed.
3. License
The Company acquired the right to market and sell a Digital Data Recorder
product line (the "License") in the states North Dakota, South Dakota,
Nebraska, Kansas, Montana, Wyoming, and Colorado. The licensed product
consists of 0 to 40 Megabit per second Bit Error Rate Testers that are
configured for laboratory and onsite use. Models consist of laboratory,
rack mount and portable versions. The licensor maintains the right to set
the pricing of the licensed products. The license was acquired on September
22, 2000 and has a four-year term. The license was purchased by the Company
for $16,000 cash from Reach Technologies, Inc., which is one-third owned by
the President of the Company and two-thirds owned by arms-length parties.
On October 31, 2001 the Company agreed to pay $20,000 in the form of a note
payable, due October 31, 2003, to amend the License agreement to a
worldwide exclusive license, except in the territories of Washington DC,
Virginia, West Virginia, Maryland, Pennsylvania, New York, Connecticut,
Massachusetts, New Hampshire, Maine, Ohio, Kentucky and Tennessee where the
license will be non-exclusive. The Company has repaid $17,837. Interest
accrues on the unpaid principal amount of $2,163 at a rate of 7% per annum,
matures October 31, 2003.and is due on demand in the event of termination
for cause, which includes breach of the agreement; the bankruptcy or
insolvency of Wizbang Technologies Inc.; or the conviction of Wizbang
Technologies Inc., its officers or directors, of any crime involving moral
turpitude.
6
On June 10, 2002 the Company agreed to pay $30,000 in the form of a note
payable, due June 30, 2004, to amend the License agreement to include a
worldwide exclusive license for data recorders in the 41 to 160 mega bit
per second range. Interest accrues on the unpaid principal amount of
$30,000 at a rate of 7% per annum, matures June 30, 2004.and is due on
demand in the event of termination for cause, which includes breach of the
agreement; the bankruptcy or insolvency of Wizbang Technologies Inc.; or
the conviction of Wizbang Technologies Inc., its officers or directors, of
any crime involving moral turpitude.
Amortization in each of the next five years is estimated as follows:
Remainder of fiscal 2003 $12,440
Fiscal 2004 $24,878
Fiscal 2005 $12,439
Fiscal 2006 $Nil
Fiscal 2007 $Nil
4. Related Party Transactions
a) During the six months ended September 30, 2001 the President of the
Company donated services valued at $6,000 and rent valued at $1,500.
These amounts were charged to operations and classified as "donated
capital" in shareholders' equity.
b) During the six months ended September 30, 2002 the Company owes a
company controlled by the President of the Company for consulting fees
of $6,000 and rent reimbursement of $1,500. These amounts were charged
to operations.
c) Mike FrankenbergerWizbang Technologies Inc.'s president and
controlling shareholder is also a one third shareholder in Reach
Technologies Inc. The two other shareholders of Reach Technologies
Inc. are not related to Mr. Frankenberger. Reach Technologies Inc.
manufactures all of the products that Wizbang Technologies Inc. sells.
Under the terms of the license Wizbang Technologies Inc. acquires the
products from Reach Technologies Inc. and resells them. The license
agreement was negotiated at arms length.
5. Restatement
During the period under review sales totaling $12,500 with associated cost
of goods sold of $8,350 were not recorded. Revenue, Cost of goods sold
Account receivable, and accounts payable have been adjusted to record these
amounts. The effect on net loss is a decrease of $4,150 from $12,326 to
$8,176. There is no effect on loss per share.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This quarterly report on Form 10-QSB contains forward-looking statements, which
are made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially from the
forward-looking statements. You should not place undue reliance on
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expects", "plans",
"anticipates", "believes", "estimated", "predicts", "potential", or "continue"
or the negative of such terms or other comparable terminology. These statements
are only predictions and involve known and unknown risks, uncertainties, and
other factors that may cause Wizbang Technologies Inc.'s actual results, levels
of activity, performance, or achievements to be materially different from any
future results, levels of activity, performance, or achievements expressed or
implied by such forward-looking statements. These factors include, among other
things, those discussed in this quarterly report on Form 10-QSB and in Wizbang
Technologies Inc.'s other filings with the SEC. Although Wizbang Technologies
Inc. believes that the expectations reflected in the forward-looking statements
are reasonable, forward-looking statements are inherently uncertain, and Wizbang
Technologies Inc. cannot guarantee future results, levels of activity,
performance, or achievements. Wizbang Technologies Inc. is under no duty to
update any of the forward-looking statements in this quarterly report on Form
10-QSB to conform forward-looking statements to actual results. All
forward-looking statements should be considered in light of these risks and
uncertainties.
Wizbang Technologies Inc. was incorporated under the laws of the State of
Washington on September 22, 2000. Wizbang Technologies Inc. principal business,
at present, is the marketing of its licensed product line consisting of
high-tech instruments that are used to record information transferred from
distant sources like aircraft and satellites. Simply put the recorders are high
speed tape recorders that are capable of recording information relayed by
several types of satellites and aircraft. Some of the data that can be recorded
include fuel consumption, engine rotation per minute, time, pictures recorded by
cameras, load stresses recorded by sensors and the status of various equipment
on the craft such as batteries or radar. The recorder operates basically the
same as a VCR with all the same play, fast-forward, rewind, record, scheduled
operation, and other similar functions. The product line is unique in that it
can record information from satellites at speeds required by those satellites.
The licensed product line consists of recorders capable of recording at speeds
up to 160 Megabits per second. The recorders are configured for both laboratory
and onsite use. Models consist of laboratory, rack mount and portable versions.
8
At March 31, 2002, Wizbang Technologies Inc. had $35,331 in current assets and
$8,371 in current liabilities. Wizbang Technologies Inc. intends to pay the
current liabilities out of cash on hand. Cash deceased by $14,067 during the
period for a balance of $22,081 at quarter-end. Accounts receivable has
increased $12,500 to $12,500 during the period as a result of sales to a new
customer. Wizbang Technologies Inc. paid $7,534 of notes payable resulting in
the $32,163 owing at year-end. Notes payable originally increased during the
period by $30,000. This note increase arose when Wizbang Technologies Inc.
agreed to pay $30,000 in the form of a note payable to amend its license
agreement with Reach Technologies Inc. to include data recorders in the 41 to
160 mega bit per second speed range. This amendment of the license resulted in
an increase in license cost to $66,000. After recording amortization of $7,000,
net license value is $49,757. Wizbang Technologies Inc. increased the scope of
its product offering in the expectation of generating future sales from those
new products.
Revenues were $12,500 for the period compared with $22,900 for the same period
last year. Gross margin was 33.2% compared with 24.5% for the same period last
year. The increase in gross margin % is due to achieving a higher relative sale
price on one product sold. Wizbang Technologies Inc.'s future plans include
continuing to market the licensed product line. The market for the product
includes aircraft and spacecraft manufacturers, both private and government,
involved in both military and nonmilitary applications and it is anticipated
that these will be the focus of selling efforts. Wizbang Technologies Inc. will
begin marketing the product to new target companies as they are identified.
Total expenses increased $6,631, over the comparable period in the previous
year, to $20,937. This net increase was due mostly to:
1. an increase in amortization expense of $5,000, resulting from the
increased license cost discussed above,
2. an increase in bank charges and interest of $763 due to the increase in
notes payable,
3. an decrease in filing fees from $2,150 to $1,133 for the electronic
filing fees incurred with respect to Wizbang Technologies Inc.'s periodic and
current reports. The prior year was higher since Wizbang Technologies Inc. was
in the mids of its form S-1 registration statement and
4. a increase in professional fees of $1,535, associated with the an
increase in legal fees associated with the Wizbang Technologies Inc.'s form 211
filing with the National Association of Stock Dealers .
Included in total expenses is $6,000 in consulting fees and $1,500 in rent
which was in prior periods donated by the President of Wizbang Technologies Inc.
and therefore did not require cash. In this period the $6,000 in consulting fees
and $1,500 in rent have been recorded as accrued liabilities and as such there
has been no increase in donated capital during the period.
9
Wizbang Technologies Inc. does expect the $22,081 in cash on hand to satisfy its
cash requirements over the next 12 months. Wizbang Technologies Inc. hopes
generate sufficient cash flow from sales to support long term continued
operations. If sales are insufficient in the long term, then Wizbang
Technologies Inc. may need additional capital to carry out its business plan. In
the event that Wizbang Technologies Inc. requires more capital, no commitments
to provide additional funds have been made by management or other shareholders.
Accordingly, there can be no assurance that any additional funds will be
available on terms acceptable to Wizbang Technologies Inc. or at all.
Wizbang Technologies Inc.'s auditors have expressed that there is substantial
doubt regarding Wizbang Technologies Inc.'s ability to continue as a going
concern. Wizbang Technologies Inc. has not generated significant revenues since
inception and has only just beginning conducting operations. The ability of
Wizbang Technologies Inc. to achieve success with respect to its planned
principal business activity is dependent upon its successful efforts to attain
profitable operations. Wizbang Technologies Inc. may not be able to sell any of
its products at a profit. There is therefore substantial doubt regarding Wizbang
Technologies Inc.'s ability to continue as a going concern.
Other than the following, Wizbang Technologies Inc. knows of no trends, events,
or uncertainties that have or are reasonably likely to have a material impact on
its short and long term liquidity:
Wizbang Technologies Inc.'s license with Reach Technologies Inc. expires on
September 30, 2004. The license is renewable by mutual agreement between
Wizbang Technologies Inc. and Reach Technologies Inc. for an additional
three-year periods. Wizbang Technologies Inc. has not yet begun discussions
with Reach Technologies Inc. with respect to the license renewal.
Other than the license renewal discussed above Wizbang Technologies Inc. does
not have material commitments for capital expenditures. If Wizbang Technologies
Inc. is successful in renewing its license agreement it intends to fund any
required capital expenditure though future sales revenues and/or debt or equity
financing.
Other than the license renewal discussed above Wizbang Technologies Inc. knows
of no trends, events, or uncertainties that have had or are reasonably expected
to have a material impact on its net sales or revenues or income for continuing
operations.
Wizbang Technologies Inc. expects no significant changes in its number of
employees.
The following is disclosure regarding recent accounting pronouncements and their
effect or potential effect on Wizbang Technologies Inc.'s financial statements.
On June 29, 2001, SFAS No. 141, "Business Combinations," was approved by the
Financial Accounting Standards Board. SFAS No. 141 requires that the purchase
method of accounting be used for all business combinations initiated after June
30, 2001. Goodwill and certain intangible assets will remain on the balance
sheet and not be amortized. On an annual basis, and when there is reason to
suspect that their values have been diminished or impaired, these assets must be
tested for impairment, and write-downs may be necessary. Wizbang Technologies
Inc. implemented SFAS No. 141 on July 1, 2001 and its impact is not expected to
be material on its financial position or results of operations.
10
On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible Assets," was
approved by Financial Accounting Standards Board. SFAS No. 142 changes the
accounting for goodwill from an amortization method to an impairment-only
approach. Amortization of goodwill, including goodwill recorded in past business
combinations, will cease upon adoption of this statement. Wizbang Technologies
Inc. is required to implement SFAS No. 142 on April 1, 2002 and its impact, if
any, is not expected to be material on its financial position or results of
operations as Wizbang Technologies Inc.'s license is a finite license with a
term of four years being the amortization period.
In June 2001, the Financial Accounting Standards Board issued SFAS No. 143,
"Accounting for Asset Retirement Obligation." SFAS No. 143 is effective for
fiscal years beginning after June 15, 2002, and will require companies to record
a liability for asset retirement obligations in the period in which they are
incurred, which typically could be upon completion or shortly thereafter. The
Financial Accounting Standards Board decided to limit the scope to legal
obligations and the liability will be recorded at fair value. The effect of
adoption of this standard on Wizbang Technologies Inc.'s results of operations
and financial positions is being evaluated.
In August 2001, the Financial Accounting Standards Board issued SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No. 144
is effective for fiscal years beginning after December 15, 2001. It provides a
single accounting model for long-lived assets to be disposed of and replaces
SFAS No. 121 "Accounting for the Impairment of Long-Lived Assets and Long-Lived
Assets to Be Disposed Of." Wizbang Technologies Inc. adopted SFAS No. 144 on
April 1, 2002. The effect of adoption of this standard on Wizbang Technologies
Inc.'s results of operations and financial position is not expected to be
material on its financial position or results of operations.
In June, 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities". The provisions of this Statement are effective for
exit or disposal activities that are initiated after December 31, 2002, with
early application encouraged. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring)". This Statement requires
that a liability for a cost associated with an exit or disposal activity be
recognized when the liability is incurred. The Company will adopt SFAS No. 146
on January 1, 2003. The effect of adoption of this standard on the Company's
results of operations and financial position is not expected to be material on
its financial position or results of operations.
FASB has also issued SFAS No. 145 and 147 but they will not have any
relationship to the operations of the Company therefore a description of each
and their respective impact on the Company's operations have not been disclosed.
11
PART II
ITEM 5. CHANGES IN SECURITIES AND USE OF PROCEEDS
a) Recent Sales Of Unregistered Securities
i. On September 22, 2000, Wizbang Technologies Inc. issued a total of
8,500,000 shares of common stock to Mike Frankenberger in exchange for $16,000
in cash. The issuance of the common stock was exempt from registration under
Regulation S. Mike Frankenberger was not a resident or citizen of the U.S. at
the time it received the offer to purchase and at the closing of the purchase of
the stock, and did not acquire the stock for the account or benefit of any U.S.
person. Mike Frankenberger agreed to resell such securities only in accordance
with the provisions of Regulation S, pursuant to registration, or pursuant to an
available exemption from registration. The stock contains a legend to the
effect that transfer is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration, or pursuant to an available exemption
from registration. Wizbang Technologies Inc. will refuse to register any
transfer of the Stock not made in accordance with the provisions of Regulation
S, pursuant to registration, or pursuant to an available exemption from
registration. The issuance of the shares was also exempt from registration under
Rule 506 of Regulation D, and sections 3(b) and 4(2) of the Securities Act of
1933, as amended, due to Mr. Frankenberger's status as the founder and initial
management of Wizbang Technologies Inc. and his status as an accredited
investor.
ii. On March 3, 2001 Wizbang Technologies Inc. issued a total of
1,600,000 shares of common stock to four foreign corporations in exchange for
$60,000 in cash. The issuance of the common stock was exempt from registration
under Regulation S. Each entity was a foreign corporation at the time it
received the offer to purchase and at the closing of the purchase of the stock,
and did not acquire the stock for the account or benefit of any U.S. person.
Each corporation agreed to resell such securities only in accordance with the
provisions of Regulation S, pursuant to registration, or pursuant to an
available exemption from registration. The stock contains a legend to the
effect that transfer is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration, or pursuant to an available exemption
from registration. Wizbang Technologies Inc. will refuse to register any
transfer of the Stock not made in accordance with the provisions of Regulation
S, pursuant to registration, or pursuant to an available exemption from
registration.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS
NONE
(B) REPORTS ON FORM 8-K.
On June 24, 2002, Wizbang Technologies Inc filed a Form 8-K with respect to
"Acquisition or Disposition of Assets" as discussed in Item 2 "Capital
Expenditures" of this form 10-QSB.
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.
Wizbang Technologies Inc.
Date: 30/10/02
/s/ Mike Frankenberger
- ------------------------
Mike Frankenberger
Title: Chief Executive Officer and Chief Financial Officer
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
Signature Title Date
- -------------------- ------------------------ ------------
/s/Mike Frankenberger President and sole Director October 30, 2002.
13
CERTIFICATION
In connection with the accompanying form 10-QSB of Wizbang Technologies
Inc. for the six months ended September 30, 2002, the following officers of
Wizbang Technologies Inc., hereby certify:
1. I have reviewed this annual report on Form 10-QSB;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report; and
9
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in
all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report.
By: /s/ Mike Frankenberger
Mike Frankenberger
President, Chief Executive Officer and Chief Financial Officer
Date: October 30, 2002
14