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 June 30, 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
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
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(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
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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 June 30, 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 Ending June 30, 2002
Part I. Financial Information
Item 1. Financial Statements
Condensed Balance Sheets - June 30, 2002 (Unaudited).
Condensed Statements of Operations (Unaudited) - For
the three months ended June 30, 2002 and for the period from
February 16, 2001 (Date of Inception) through June 30, 2002.
Condensed Statements of Cash Flows (Unaudited) - For
the period February 16, 2001 (Date of Inception) through June
30, 2002.
Notes to Condensed Financial Statements (Unaudited) -
June 30, 2002
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Part II. Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Matters
Item 6. Exhibits and Reports on Form 8-K
Signatures
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Part I - Financial Information
Item 1. Financial Statements
Item 1. Financial Statements
MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprise)
CONDENSED BALANCE SHEETS
(UNAUDITED)
June 30, December 31,
2002 2001
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ASSETS
Current Assets
Cash $ 56,889 $ 99,910
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Total Assets $ 56,889 $ 99,910
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable $ 9,740 $ 23,104
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Total Current Liabilities 9,740 23,104
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Stockholders' Equity (Deficit)
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 (79,443) (49,786)
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Total Stockholders' Equity (Deficit) 47,149 76,806
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Total Liabilities and Stockholders'
Equity (Deficit) $ 56,889 $ 99,910
========= =========
The accompanying notes are an integral part of these condensed
financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Development Stage Enterprise)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the Period For the Period
February 16, February 16,
For the 2001 (Date of 2001 (Date of
Six Months Inception) For the Three Months Inception)
Ended Through Ended June 30, Through
June 30, June 30, ------------------- June 30,
2002 2001 2002 2001 2002
--------- --------- --------- -------- ---------
Revenue $ 300 $ - $ 300 $ - $ 300
General and administrative
expenses 29,957 21,300 16,608 5,223 79,743
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Net Loss $ (29,657) $ (21,300) $ (16,308) $ (5,223) $ (79,443)
========= ========= ========= ======== =========
Basic and Diluted Loss
Per Share $ (0.05) $ (0.05) $ (0.03) $ (0.01)
========= ========= ========= ========
Weighted Average Number
of Shares Outstanding 619,000 510,000 619,000 510,000
========= ========= ========= ========
The accompanying notes are an integral part of these condensed
financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Company in the Development Stage)
CONDENSED STAEMENTS OF CASH FLOWS
(UNAUDITED)
For the Period From
February 16, 2001
The Six (Date of Inception)
Months Through
Ended --------------------
June 30, June 30, June 30,
2002 2001 2002
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Cash Flows From Operating Activities
Net loss $ (29,657) $ (26,523) $ (79,443)
Stock issued for services - 25,000 25,000
Changes in current assets and liabilities:
Prepaid expense - (2,275) -
Accounts payable (13,364) - 9,740
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Net Cash Used in Operating Activities (43,021) (3,798) (44,703)
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Net Cash Used in 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 - 5,000 15,000
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Net Cash Provided by Financing Activities - 10,000 101,592
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Net Increase (Decrease) in Cash (43,021) 6,202 56,889
Cash at Beginning of Period 99,910 - -
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Cash at End of Period $ 56,889 $ 6,202 $ 56,889
========= ========= =========
Non-Cash Investing and Financing Activities:
Common stock issued for receivable
from shareholders $ - $ 15,000 $ 15,000
The accompanying notes are an integral part of these condensed
financial statements.
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MORTGAGE PROFESSIONALS LEAD SOURCE, INC.
(A Company in the Development Stage)
CONDENSED STATEMENTS OF OPERATIONS
(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 six months ended June
30, 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 June 30, 2002, the Company
incurred a net loss and accumulated deficit of $79,443 and used cash from
operations of $44,703. 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. The company
is presently modifying its business plan to attempt to seek out new business
opportunities for direct participation, or to acquire or be acquired by
acquisition or merger. 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. There are no assurances that the Company will
be successful in these efforts.
NOTE 2 - SUBSEQUENT EVENTS
Subsequent to the period ended June 30, 2002 the Company entered into an
agreement with Belsen Getty for future consulting services. The Company paid
Belsen Getty $25,000 and three of the principal shareholders agreed to transfer
329,000 shares of their capital stock to Belsen Getty.
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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.
The accumulated deficit for MPLS during the development stage resulting from
general and administrative expenses was $79,443 as of June 30, 2002. There
remains approximately $56,889 of net proceeds from the offering as of June 30,
2002.
To date, MPLS has completed implementation of its initial marketing plan to
attempt to secure refinancing commitments from home owners and small businesses
on existing mortgage loans through mass marketing techniques.
The company's initial marketing efforts were directed through a television
advertising campaign. When this effort did not generate any significant
revenues and caused the company to continue to expend capital significantly in
excess of those minimal revenues, the company attempted to shift to radio and
billboard marketing. Neither of these alternative marketing methods have
generated meaningful revenues. From the close of MPLS's IPO to June 30, 2002,
the company has expended approximately $11,110 on direct marketing expenses.
Management has now made a strategic decision not to continue to expend any more
of the approximate $47,149 in remaining liquid capital in an attempt to market
the mortgage refinancing concept. Management has alternatively determined to
employ the remaining capital to maintain the company as a public company while
exploring alternative business activities and/or merger or acquisition
possibilities.
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At present, the overhead for MPLS is approximately $4,600 per month including
estimated expenses for reporting and operating as a public trading company. At
this estimated rate of expenditure, the company could continue for approximately
12 months. No assurance is made or implied MPLS can continue to exist at this
rate of estimated monthly expenditure, or that it will be successful in finding
new business opportunities
Liquidity and Sources of Capital
It is possible that MPLS could seek subsequent private placement financing
funds, loans or other means to continue its 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
The company is presently modifying its business plan to attempt to seek out new
business opportunities for direct participation, or to acquire or be acquired by
acquisition or merger. 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 SB-1.
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. Accrued offering related costs including printing, accounting, legal
and related filing fees - $27,708.
3. Amount expended to June 30, 2002 on marketing and operations - $24,711.
4. Net proceeds for future operations: $56,889 as of June 30, 2002.
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Item 4. Submission of Matters to a Vote of Security Holders
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
1. At the time of the preparation of this report, MPLS was engaged in
meaningful and ongoing discussions with various third parties about a potential
acquisition whereby MPLS would acquire all assets and business interest of a
private technology company in exchange for the issuance of a substantial
majority of its shares, estimated to be 90% if the proposal is consummated. In
the event this proposed transaction is closed, MPLS would request shareholders
by vote or majority consent to approve a new Board and probable name change.
This type of acquisition is often referred to as a "reverse acquisition" since
the acquired company typically provides the new management, business purpose and
name, as well as its owners acquiring the majority of shares in the acquiring
company.
You are advised that the foregoing transaction is, as of this report preparation
date, in the proposal stage and there is no assurance or warranty this proposal
will be accepted in final form or closed upon review by your management. In all
events, shareholders will receive further notice as to this proposed
transaction, if closed, and any definitive transaction will be subsequently
reported by MPLS on Form 8-K.
2. As of July 8, 2002, MPLS has entered a consulting agreement, primarily
related to finding new business opportunities, with Belsen Gettey, Inc. Three
principals of the Company transferred 329,000 shares in consideration for this
contract.
Item 6. Exhibits and Reports on Form 8-K
99.1 Certification under Section 906 of the Sarbanes-Oxley Act
(18 U.S.C. SECTION 1350)
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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: August 8, 2002 By: /s/ Gregory Willits
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Mr. Gregory Willits
President
Date: August 8, 2002 By: /s/ Michael J. Christensen
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Mr. Michael J. Christensen
Chief Financial and Accounting Officer
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