UNITED STATES
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 PERIOD ENDED March 31, 2002
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OR
[ ] 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 333-60362
MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(Exact name of registrant as specified in its charter)
Utah 87-0670014
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
959 East Akers Way
Sandy, Utah 84094
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(Address of principal executive officers)
(801) 898-0026
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (l) 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 periods that the registrant was
required to file such reports), X Yes No; and (2) has been subject to
such filing requirements for the past 90 days: X Yes No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by the court. Yes No Not Applicable
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date. Common Stock: 619,300 shares
issued as of May 1, 2002. No Par Value. Authorized - 50,000,000 common voting
shares. The company has only one class of shares.
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INDEX
Mortgage Professionals Lead Source, Inc.
For The Quarter Ended March 31, 2002
Part I. Financial Information
Item 1. Financial Statements
Condensed Balance Sheets - March 31, 2002 and December 31,
2001 (Unaudited). 3
Condensed Statements of Operations (Unaudited) - For the Three
Months Ended March 31, 2002, For the Period February 16, 2001
(Date of Inception) through March 31, 2001, and For the Period
February 16, 2001 (Date of Inception) through March 31, 2002. 4
Condensed Statements of Cash Flows (Unaudited) - For the Three
Months Ended March 31, 2002, For the Period February 16, 2001
(Date of Inception) through March 31, 2001, and For the Period
February 16, 2001 (Date of Inception) through March 31, 2002. 5
Notes to Condensed Financial Statements (Unaudited) - March
31, 2002 6
Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations 7
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 5. Other Matters 9
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 10
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Part I - Financial Information
Item 1. Financial Statements
MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprises)
CONDENSED BALANCE SHEETS
(UNAUDITED)
ASSETS
March 31, December 31,
2002 2001
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Current Assets
Cash $ 70,908 $ 99,910
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Total Assets $ 70,908 $ 99,910
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 7,451 $ 23,104
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Total Current Liabilities 7,451 23,104
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Stockholders' Equity
Common stock, no par value; 50,000,000 shares
authorized; 619,300 shares issued and outstanding 126,592 126,592
Deficit accumulated during the development stage (63,135) (49,786)
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Total Stockholders' Equity 63,457 76,806
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Total Liabilities and Stockholders' Equity $ 70,908 $ 99,910
========== ==========
See accompanying notes to unaudited condensed financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprise)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the
Three For the Period
Months February 16, 2001
Ended (Date of Inception)
March 31, ----------------------
2002 2001 2002
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Revenue $ - $ - $ -
General and administrative expenses 13,349 5,223 63,135
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Net Loss $ (13,349) $ (5,223) $ (63,135)
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Basic and Diluted Loss Per Share $ (0.02) $ (0.01) $ (0.12)
========== ========== ==========
Weighted Average Number of Shares Outstanding 619,300 510,000 541,075
========== ========== ==========
See accompanying notes to unaudited condensed financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprise)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the
Three For the Period
Months February 16, 2001
Ended (Date of Inception)
March 31, ----------------------
2002 2001 2002
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Cash Flows From Operating Activities
Net loss $ (13,349) $ (5,223) $ (63,135)
Stock issued for services - 5,000 25,000
Changes in current liabilities:
Accounts payable (15,653) 7,451
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Net Cash Used by Operating Activities (29,002) (223) (30,684)
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Net Cash From Investing Activities - - -
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Cash Flows From Financing Activities
Proceeds from issuance of common stock - 5,000 114,300
Offering costs on initial public offering - - (27,708)
Cash received on receivable from
shareholders - - 15,000
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Net Cash Provided by Financing Activities - 5,000 101,592
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Net (Decrease) Increase In Cash (29,002) 4,777 70,908
Cash at Beginning of Period 99,910 - -
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Cash at End of Period $ 70,908 $ 4,777 $ 70,908
========== ========== ==========
Non-Cash Financing and Investing Information
Common stock issued for receivable from
shareholders $ - $ 5,000 $ 15,000
Accruals of deferred offering costs $ - $ 20,000 $ -
See accompanying notes to unaudited condensed financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprise)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2002
(UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Interim Financial Statements-The accompanying financial statements are
unaudited. In the opinion of management, all necessary adjustments (which
include only normal recurring adjustments) have been made to present fairly the
financial position, results of operations and cash flows for the periods
presented. Certain information and disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with the
Company's financial statements and notes thereto included in the Form 10-KSB
dated March 25, 2002. The results of operations for the three months ended March
31, 2002 are not necessarily indicative of the operating results to be expected
for the full year ending December 31, 2002.
Business Condition - The accompanying financial statements have been prepared on
a going concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. During the period
from February 16, 2001 (date of inception) through March 31, 2002, the Company
incurred a net loss and accumulated deficit of $63,135 and used cash from
operations of $30,684. As of March 31, 2002, the Company has had no revenues.
These factors, among others, indicate that the Company may be unable to continue
as a going concern. The accompanying financial statements do not include any
adjustments relating to the carrying amount and classification of recorded
assets or the amount and classification of liabilities that might be necessary
should the Company be unable to continue as a going concern. As of December 31,
2001, the Company had received gross proceeds of $109,300 from its initial
registered public offering. The Company incurred costs totaling $27,708 in
conjunction with this offering. Management plans to develop a customer base for
mortgages with the use of an "infomercial" advertising approach. Management
plans to offer favorable mortgage rates and other mortgage terms by obtaining
financing commitments from various third party mortgage or finance companies. As
of April 30, 2002, no commitments for financing had been obtained. The Company's
ability to continue as a going concern is dependent upon its ability to generate
sufficient cash flows to meet its obligations on a timely basis, to obtain
additional financing and ultimately to attain successful operations.
NOTE 2 -RELATED PARTY TRANSACTIONS
Two officers of the Company are presently principal officers in
Velocityloan.com, a related entity. Velocityloan.com acts as an internet loan
broker. The Company's relationship to Velocityloan.com may subject the Company
to certain charges or claims of preferential dealing in the placement of any
loans through Velocityloan.com.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Forward-Looking Information
Certain statements in this Section and elsewhere in this report are forward-
looking in nature and relate to trends and events that may affect the Company's
future financial position and operating results. Such statements are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The terms "expect", "anticipate", "intend", and "project"
and similar words or expressions are intended to identify forward-looking
statements. These statements speak only as of the date of this report. The
statements are based on current expectations, are inherently uncertain, are
subject to risks, and should be viewed with caution. Actual results and
experience may differ materially from the forward-looking statements as a result
of many factors, including changes in economic conditions in the markets served
by the company, increasing competition, fluctuations in raw materials and energy
prices, and other unanticipated events and conditions. It is not possible to
foresee or identify all such factors. The company makes no commitment to update
any forward-looking statement or to disclose any facts, events, or circumstances
after the date hereof that may affect the accuracy of any forward-looking
statement.
Results of Operations
Mortgage Professional Lead Source, Inc. ("MPLS") was incorporated in Utah on
February16, 2001 and has been involved exclusively to this point in start-up
operations including incorporation, initial organization and an initial public
offering ("IPO") of its shares and start-up marketing operations. The offering
became effective with the Securities and Exchange Commission (SEC) on August 16,
2001 and in the State of Utah on such date by coordination. The offering was
closed on December 5, 2001 after raising $109,300 in gross proceeds.
As of March 31, 2002 the deficit accumulated during the development stage was
$63,135, which resulted from general and administrative and expenses. MPLS had
remaining cash from the net proceeds of the offering of $70,908 as of March 31,
2002.
The Company commenced implementation of its initial marketing plan to provide
mortgage finance and refinance opportunities to homeowners through the use of
television spots (infomercials) in December 2001. The Company's initial efforts
were to market in the greater Salt Lake City, Utah area employing television
spots on locally owned stations. The current range of mortgage rates and other
costs of refinancing and other basic details were presented to prospective
homeowners that were looking to refinance their homes or other properties.
Interested individuals would then call a provided local or toll-free number and
speak to a representative of the Company who would take further information and
then make referrals of interested parties to select mortgage brokers, which MPLS
had selected earlier on the basis of believing they provide the best and most
competitive rates and services for financing or mortgage refinancing purposes.
Mortgage initiated these initial infomercials in December 2001 and have aired
approximately 20 television spots averaging approximately 15 minutes each
through March 1, 2002 on late night local stations.
To date, Mortgage has not realized any significant gross revenues from its
initial marketing to March 1, 2002. The Company does not believe that it has
sufficiently implemented or funded all initial marketing plans to determine the
success or viability of this concept.
Because the IPO was closed as a minimum offering, it is not anticipated that
the initial marketing efforts will be attempted beyond the Salt Lake City
metropolitan area. As indicated in the initial offering materials, there
remains the possibility that despite its best efforts the concept or
implementation of this market plan may not prove successful and the proceeds of
the Company may be used without any tangible earnings being generated. MPLS
will be required to consider alternative marketing approaches or alternative
business activities as explained under the following Plan of Operations.
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Liquidity and Sources of Capital
As noted above, MPLS has engaged in limited business operations to date. MPLS
has expended approximately $27,700 of its initial offering proceeds of $109,300
on offering related costs and approximately $10,692 on operations through March
31, 2002. It presently has approximately $70,908 in net proceeds remaining.
The company estimates its current monthly maintenance costs at approximately
$3,200 per month including present marketing activities. Accordingly, MPLS
could continue without revenues for approximately 22 months in its current
operations without additional capital. However, management believes that it
must change its current marketing efforts to have any prospect of achieving
significant revenues. See "Plan of Operations" below.
It is possible that MPLS could seek subsequent private placement financing
funds, loans or other means to continue its business operations, though there
can be no assurance or warranty that any such funds will be available or be
sought. Further, MPLS may deem it is not feasible or appropriate to seek such
alternative financing if the initial IPO proceeds are not sufficient to sustain
continuing operations.
Plan of Operations
Recently Mortgage has commenced a collateral marketing campaign that includes
billboards and radio advertisements to supplement its initial marketing
activities. To date, the Company has expended for the production of this
collateral campaign, including first month costs, the total amount of $4,679.
This collateral activity has also not proven to be effective to this date.
The company is presently modifying its marketing plan to attempt direct mailings
and electronic telephone solicitation of its services. If these alternatives
are not effective, MPLS will most likely consider alternative business
activities to employ its remaining net proceeds. If MPLS is not successful in
finding a revenue producing activity or a suitable merger or acquisition in the
next few months, it may be forced to discontinue operations.
Part II - Other Information
Item 1. Legal Proceedings
MPLS is not presently engaged in any legal proceedings, nor does it know of any
claims for or against the company by any party.
Item 2. Changes in Securities and Use of Proceeds
The company has not had any change in its securities since its last report
filing on Form 10-KSB.
In accordance with SEC Rule 463 the company reports the use of proceeds to
date from its initial public offering "IPO" completed on December 5, 2001:
1. Gross proceeds sold - $109,300
2. Offering related costs including printing, accounting, legal and
related filing fees - $27,708.
3. Amount expended from December 5, 2001 through March 31, 2002 on
marketing and operations - $10,692.
4. Net proceeds for future operations - $70,908.
Item 4. Submission of Matters to a Vote of Security Holders
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During the present quarter there has been no matter submitted to security
holders for a vote. MPLS presently anticipates holding its first annual
shareholders meeting at a date to be determined in late 2002. Shareholders
will be independently advised of any such formal annual meeting date.
Item 5. Other Matters
On approximately March 28, 2002, MPLS obtained a listing on the NASD sponsored
electronic bulletin board, symbol MPLL. At present MPLS has one market maker
and has traded in the range of $1.25 -$1.50. There has been very limited
trading activity.
Item 6. Exhibits and Reports on Form 8-K
A prior 8-K pertaining to change of Directors and close of IPO was filed
December 6, 2001 and is incorporated by this reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
REGISTRANT: MORTGAGE PROFESSIONAL LEAD SOURCE, INC.
Date: May 14, 2002 By: /s/ Gregory Willits
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Mr. Gregory Willits
President
Date: May 14, 2002 By: /s/ Michael J. Christensen
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Mr. Michael J. Christensen
Chief Financial and Accounting Officer
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