U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[x] Quarterly Report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 2000
- --------------------------------------------------------------------------
[ ] Transition Report under Section 13 or 15(d)of the Exchange Act For the
Transition Period from ________ to ___________
- --------------------------------------------------------------------------
Commission File Number: 0-26181
- --------------------------------------------------------------------------
eCLIC, INC.
- --------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Nevada 86-0945116
- ------------------------------- ------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8455 W. Sahara, Suite 130
Las Vegas, NV 89117
- -------------------------------------------------------------------------
(Address of principal executive offices)
(888) 971-1336
- -------------------------------------------------------------------------
(Issuer's telephone number)
- -------------------------------------------------------------------------
Check whether the issuer (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 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 [ ] No [X]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS
Check whether the Registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act
after the distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
1
The Registrant has 1,515,000 shares of Common stock issued and
outstanding, par value $.001 per share as of June 30, 2000. The
Registrant has no Preferred Stock issued nor outstanding as of June
30, 2000.
Traditional Small Business Disclosure Format (check one)
Yes [ ] No [X]
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements................................. 3
CPA Review Letter.................................... 4
Balance Sheet (unaudited)............................ 5
Statements of Operations (unaudited)................. 6
Statements of Cash Flows (unaudited)................. 7
Notes to Financial Statements........................ 8-9
Item 2. Management's Discussion and Analysis of Plan
of Operation........................................ 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.................................... 15
Item 2. Changes in Securities and Use of Proceeds............ 15
Item 3. Defaults upon Senior Securities...................... 15
Item 4. Submission of Matters to a Vote
of Security Holders................................. 15
Item 5. Other Information..................................... 15
Item 6. Exhibits and Reports on Form 8-K...................... 15
Signatures...................................................... 16
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS
The unaudited financial statements of registrant for the three
months ended June 30, 2000, follow. The financial statements
reflect all adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the interim period
presented.
3
G. BRAD BECKSTEAD
Certified Public Accountant
330 E. Warm Springs
Las Vegas, NV 89119
702.528.1984
425.928.2877 (efax)
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
Board of Directors
eCLIC, Inc.
(a Development Stage Company)
Las Vegas, NV
I have reviewed the accompanying balance sheet of eCLIC, Inc. (a Nevada
corporation) (a development stage company) as of June 30, 2000 and the related
statements of operations for the three-month and six-month periods ended June
30, 2000 and 1999 and for the period March 1, 1999 (Inception) to June 30,
2000, and statements of cash flows for the six-month periods ending June 30,
2000 and 1999 and for the period March 1, 1999 (Inception) to June 30, 2000.
These financial statements are the responsibility of the Company's management.
I conducted my reviews in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data, and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, which will be performed
for the full year with the objective of expressing an opinion regarding the
financial statements taken as a whole. Accordingly, I do not express such an
opinion.
Based on my reviews, I am not aware of any material modifications that should
be made to the accompanying financial statements referred to above for them
to be in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 5 to the financial
statements, the Company has had limited operations and has not commenced
planned principal operations. This raises substantial doubt about its ability
to continue as a going concern. Management's plans in regard to these
matters are also described in Note 5. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
I have previously audited, in accordance with generally accepted auditing
standards, the balance sheet of eCLIC, Inc. (a development stage company) as of
December 31, 1999, and the related statements of operations, stockholders'
equity, and cash flows for the year then ended (not presented herein) and in my
report dated March 24, 2000, I expressed an unqualified opinion on those
financial statements.
/s/ G. Brad Beckstead, CPA
- --------------------------
August 1, 2000
License #2701
4
eCLIC, Inc.
(A Development Stage Company)
Balance Sheet
June 30, 2000
And
December 31, 1999
BALANCE SHEET
Unaudited Audited
------------------------------
June 30, December 31,
2000 1999
Assets
Current assets:
Cash $ 42,689 $ 19,097
---------- ----------
Total current assets 42,689 19,097
Fixed assets:
Website development costs 13,000 13,000
Less accumulated depreciation (3,033) (1,733)
Total fixed assets 9,967 11,267
---------- ----------
Total Assets $ 52,656 $ 30,364
========== ==========
Liabilities and Stockholders' Equity
Current liabilities $ - $ -
Long-term liabilities - -
Total liabilities - -
Stockholders' Equity:
Preferred stock, $0.001 par value,
5,000,000 shares authorized,
zero shares issued
and outstanding - -
Common stock, $0.001 par value,
20,000,000 shares authorized,
1,515,000 shares issued
and outstanding 1,515 1,500
Additional paid-in capital 80,338 50,354
Deficit accumulated during
development stage (29,197) (21,490)
--------- ----------
Total stockholders' equity 52,656 30,364
--------- ----------
Total Liabilities and Stockholders' Equity $ 52,656 $ 30,364
========= ==========
See accompanying notes to financial statements.
5
eCLIC, Inc.
(A Development Stage Company)
Statement of Operations
For the Three Months and Six Months Ending June 30, 2000 and 1999, and
For the Period March 1, 1999 (Inception) to June 30, 2000
STATEMENT OF OPERATIONS
Unaudited Audited
--------- --------
March 1,
Three mos ending Six mos ending 1999
June 30 June 30 (Inception)
2000 1999 2000 1999 Jun 30, 2000
-----------------------------------------------------
Revenue $ - $ - $ - $ - $ 775
Expenses:
Depreciation expense 1,127 433 1,300 433 3,033
General administrative
Expenses 4,334 3,520 6,407 6,319 23,289
Research and development
Expense - 3,650 - 3,650 3,650
--------- -------- --------- -------- -------
Total expenses 5,461 7,603 7,707 10,402 29,972
Net loss $ (5,461) $ (7,603) $ (7,707) $(10,402) $(29,197)
========== ========= ========= ========= =========
Weighted average
number of
common shares
outstanding 1,515,000 1,500,000 1,515,000 1,500,000 1,515,000
Net loss per share $ - $ - $ - $ - $ -
======== ======= ======== ========= ========
See accompanying notes to financial statements.
6
eCLIC, Inc.
(A Development Stage Company)
Statement of Cash Flows
For the Six Months Ending June 30, 2000 and 1999
and For the Period March 1, 1999 (Inception) to June 30, 2000
STATEMENT OF CASH FLOWS
Unaudited Audited
-------------------------------
March 1, 1999
(Inception) to
June 30, June 30, June 30,
2000 1999 2000
-------------------------------------
Cash flows from operating activities
Net loss $ (7,707) $ (10,402) $ (29,197)
Adjustments to reconcile net
income to net cash used
by operating activities:
Depreciation expense 1,299 433 3,033
Net cash used by
operating activities (6,408) (9,969) (26,164)
------------------------------------
Cash flows from investing activities
Development of website - (10,000) (13,000)
Net cash provided (used)
by investing activities - (10,000) (13,000)
------------------------------------
Cash flows from financing activities
Issuance of common stock 30,000 51,853 81,853
------------------------------------
Net cash provided by
financing activities 30,000 51,853 81,853
------------------------------------
Net (decrease) increase in cash 23,592 31,884 42,689
====================================
Cash - beginning 19,097 - -
Cash - ending $ 42,689 $ 31,884 $ 42,689
====================================
Supplemental disclosures:
Interest paid $ - $ - $ -
Income taxes paid $ - $ - $ -
See accompanying notes to financial statements.
7
eCLIC, Inc.
(A Development Stage Company)
Footnotes
Note 1 - History and organization of the company
The Company was organized March 1, 1999 (Date of Inception) under the laws of
the State of Nevada, as eCLIC, Inc. The Company has limited operations and in
accordance with SFAS #7, the Company is considered a development stage company.
Note 2 - Summary of significant accounting policies
Accounting policies and procedures have not been determined except as follows:
1. The Company uses the accrual method of accounting.
2. The preparation of financial statements in conformity with 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 revenue and expenses during the
reporting period. Actual results could differ significantly from those
estimates.
3. The Company maintains a cash balance in a non-interest-bearing bank that
currently does not exceed federally insured limits. For the purpose of the
statements of cash flows, all highly liquid investments with the maturity of
three months or less are considered to be cash equivalents. There are no cash
equivalents as of June 30, 2000.
4. Earnings per share (EPS) is computed using the weighted average number of
shares of common stock outstanding during the period. Diluted EPS is computed
by dividing net income by the weighted average shares outstanding, assuming all
dilutive potential common shares were issued. Since the Company has no common
shares that are potentially issuable, such as stock options, convertible
preferred stock and warrants, basic and diluted EPS are the same. The Company
had no dilutive common stock equivalents such as stock options as of June 30,
2000.
5. The Company has not yet adopted any policy regarding payment of dividends.
No dividends have been paid since inception.
6. Web development costs are capitalized and amortized over a period of 60
months.
7. The Company will review its need for a provision for federal income tax
after each operating quarter and each period for which a statement of
operations is issued.
8. The Company has adopted December 31 as its fiscal year end.
Note 3 - Income taxes
8
eCLIC, Inc.
(A Development Stage Company)
Footnotes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS #109)
"Accounting for Income Taxes". A deferred tax asset or liability is recorded
for all temporary differences between financial and tax reporting. Deferred
tax expenses (benefit) results from the net change during the year of deferred
tax assets and liabilities. There is no provision for income taxes for the
year ended June 30, 2000, due to the net loss and no state income tax in
Nevada.
Note 4 - Stockholders' equity
The Company is authorized to issue 20,000,000 shares of $0.001 par value common
stock and 5,000,000 shares of $0.001 par value preferred stock.
On March 1, 1999, the Company issued 1,000,000 shares of its $0.001 par value
common stock to its directors for cash in the amount of $1,000.
On April 5, 1999, the Company completed a Regulation D, Rule 504 of the
Securities Act of 1933, as amended, whereby it sold 500,000 shares of its
common stock to approximately 40 unaffiliated shareholders of record. The
Company filed an original Form D with the Securities and Exchange Commission
on or about March 22, 1999. The offering raised a total of $51,854, of which
$500 is common stock and $50,354 is additional paid-in capital.
On May 4, 2000, the Company sold 15,000 shares of its $0.001 par value common
stock in a Regulation D, Rule 506 of the Securities Act of 1933, as amended,
private placement offering to one investor. The offering raised a total of
$30,000, of which $15 is common stock and $29,985 is additional paid-in
capital.
There have been no other issuances of common or preferred stock.
Note 5 - Going concern
The Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. The Company has not commenced its planned principal operations and
it intends to sell additional shares of its authorized common or preferred
stock if capital is needed. Without realization of additional capital, it
would be unlikely for the Company to continue as a going concern.
Note 6 - Related party transactions
The Company does not lease or rent any property. Office services are provided
without charge by a director. Such costs are immaterial to the financial
statements and, accordingly, have not been reflected therein. The officers
and directors of the Company are involved in other business activities and may,
in the future, become involved in other business opportunities. If a specific
business opportunity becomes available, such persons may face a conflict in
selecting between the Company and their other business interests. The Company
has not formulated a policy for the resolution of such conflicts.
Note 7 - Warrants and options
There are no warrants or options outstanding to acquire any additional shares
of common stock.
Note 8 - Year 2000 issue
The Year 2000 issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information
using year 2000 dates is processed. In addition, similar problems may arise
in systems which use certain dates in 1999 to represent something other than a
date. The effects of the Year 2000 issue may be experienced before, on, or
after January 1, 2000, and if not addressed, the impact on operations and
financial reporting may range from minor errors to significant system failure
which could affect an entity's ability to conduct normal business operations.
It is not possible to be certain that all aspects of the Year 2000 issue
affecting the entity, including those related to the efforts of customers,
suppliers, or other third parties will be fully resolved.
9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATIONS
The current core business of eClic, Inc. (eClic.com) is to market and
sell health care products through an Internet Web Site. The Company
plans to seek outside suppliers who would be willing to allow eClic.com
to merchandise, market and sell their products through the Company's
Internet Web site, for a nominal fee. These suppliers would be
responsible for inventory, billing and shipping their products to the
potential customers generated through the Company's Web site. The
company plans to focus, but not limit itself to health care products.
There are a number of personal care products where consumers might
prefer the ease, convenience and privacy of ordering these products
through the Internet. Additionally, the Company plans to seek
advertisers to advertise their product(s) on the Company's Web
site. For any advertisers on the Company's Web site, the Company will
provide a link to the advertisers' Web site and charge a customary/
nominal fee, for each customer who links to their advertiser's Web
site.
The Company has a limited operating history upon which an evaluation of
the Company, its current business and its prospects can be based, each
of which must be considered in light of the risks, expenses and
problems frequently encountered by all companies in the early stages
of development, and particularly by such companies entering new and
rapidly developing markets like the Internet. The Company's prospects
must be considered in light of the risks, uncertainties, expenses and
difficulties frequently encountered by companies in their early stages
of development, particularly companies in new and rapidly evolving
markets such as online commerce.
10
The Company has not achieved profitability to date, and the Company
anticipates that it will continue to incur net losses for the
foreseeable future. The extent of these losses will depend, in part,
on the amount of growth in the Company's revenues from sales of its
products, and possibility advertising revenues on its Web site. As of
June 30, 2000, the Company had an accumulated deficit of $29,197
dollars. The Company expects that its operating expenses will
increase significantly during the next several months, especially in
the areas of sales and marketing, and brand promotion. Thus, the
Company will need to generate increased revenues to achieve
profitability. To the extent that increases in its operating expenses
precede or are not subsequently followed by commensurate increases in
revenues, or that the Company is unable to adjust operating expense
levels accordingly, the Company's business, results of operations and
financial condition would be materially and adversely affected. There
can be no assurances that the Company can achieve or sustain
profitability or that the Company's operating losses will not increase
in the future.
Going Concern - The Company experienced operating losses for the period
ended June 30, 2000. The financial statements have been prepared
assuming the Company will continue to operate as a going concern which
contemplates the realization of assets and the settlement of
liabilities in the normal course of business. No adjustment has been
made to the recorded amount of assets or the recorded amount or
classification of liabilities which would be required if the Company
were unable to continue its operations. As discussed in Note 5, of
the notes to the financial statements, management believes it has
enough funds to operate for the next twelve (12) months without the
need to raise additional capital to meet its obligations in the normal
course of business.
Unclassified Balance Sheet - In accordance with the provisions of SFAS
No. 53, the Company has elected to present an unclassified balance sheet.
11
Loss Per Share - The Company adopted the provisions of Statement
Of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share" that established standards for the computation, presentation
and disclosure of earnings per share ("EPS"), replacing the
presentation of Primary EPS with a presentation of Basic EPS. It also
requires dual presentation of Basic EPS and Diluted EPS on the face of
the income statement for entities with complex capital structures.
The Company did not present Diluted EPS since it has a simple capital
structure.
The Company has not pursued or explored any opportunities for an
acquisition or merger. This does not preclude that the Company may not
explore any opportunities in the future.
Results of Operations
During the Second Quarter ended June 30, 2000, the Company did not
generate any revenues. In addition, the Company does not expect to
generate any profit for the next two Quarters.
In its most recent three month operating period ended June 30, 2000,
the Company did not generate any revenues; and, the Company incurred
operating expenses of $5,461, for a net loss of approximately $5,461
and a positive cash flow $23,593 for the Second Quarter, primarily
due to new financing. During the Second Quarter, the Company continued
to seek and identify suppliers for its website. The majority of the
Company's expenses for the Quarter included administrative fees.
Plan of Operation
Management does believe that the Company will be able to generate some
revenues during the coming year, management does not believe the
company will generate any profit until sometime in Calendar Year 2000,
as developmental and marketing costs will most likely exceed any
anticipated revenues.
As stated earlier in this filing, the Company believes it has enough
monies to sustain itself for the next twelve months, during this
developmental process.
12
Liquidity and Capital Resources
On April 5, 1999, the Company completed a public offering of shares of
Common stock of the Company pursuant to Regulation D, Rule 504 of the
Securities Act of 1933, as amended, whereby it sold 500,000 shares of
the Common Stock of the Company to 40 unaffiliated shareholders of
record. The Company filed an original Form D with the Securities and
Exchange Commission on or about March 22, 1999. As of April 5, 1999,
the Company has 1,500,000 shares of common stock issued and
outstanding held by 41 shareholders of record.
On May 4, 2000, the Company sold 15,000 shares of its $0.001 par value common
stock in a Regulation D, Rule 506 of the Securities Act of 1933, as amended,
private placement offering to one investor. The offering raised a total of
$30,000, of which $15 is common stock and $29,985 is additional paid-in
capital.
The Company is a development stage Internet e-Commerce company with a
principal business objective to sell and market health related products
or products which offer the Company potential revenues, and generate
advertising revenues from other vendors who sell and market products
through the World Wide Internet.
The Company currently has 2 employees who are both officers and
directors of the Company. These employees received no compensation
through June 30, 2000. The Company does not plan to hire any
additional employees until it can become an profitable entity. (See
employment agreements in 10-SB12G).
The Company has no material commitments for capital expenditures nor
does it foresee the need for such expenditures over the next year.
13
Forward-Looking Statements
This Form 10-QSB includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements, other than
statements of historical facts, included or incorporated by reference in this
Form 10-QSB which address activities, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof), finding
suitable merger or acquisition candidates, expansion and growth of the Company's
business and operations, and other such matters are forward-looking statements.
These statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
or developments will conform with the Company's expectations and predictions is
subject to a number of risks and uncertainties, general economic market and
business conditions; the business opportunities (or lack thereof) that may be
presented to and pursued by the Company; changes in laws or regulation; and
other factors, most of which are beyond the control of the Company.
This Form10-QSB contains statements that constitute "forward-looking
statements." These forward-looking statements can be identified by the use of
predictive, future-tense or forward-looking terminology, such as "believes,"
"anticipates," "expects," "estimates," "plans," "may," "will," or similar
terms. These statements appear in a number of places in this Registration and
include statements regarding the intent, belief or current expectations of
the Company, its directors or its officers with respect to, among other
things: (i) trends affecting the Company's financial condition or results of
operations for its limited history; (ii) the Company's business and growth
strategies; (iii) the Internet and Internet commerce; and, (iv) the Company's
financing plans. Investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve significant
risks and uncertainties, and that actual results may differ materially from
those projected in the forward-looking statements as a result of various
factors. Factors that could adversely affect actual results and performance
include, among others, the Company's limited operating history, dependence
on continued growth in the use of the Internet, the Company's inexperience
with the Internet, potential fluctuations in quarterly operating results and
expenses, security risks of transmitting information over the Internet,
government regulation, technological change and competition.
Consequently, all of the forward-looking statements made in this Form 10-QSB
are qualified by these cautionary statements and there can be no assurance
that the actual results or developments anticipated by the Company will be
realized or, even if substantially realized, that they will have the expected
consequence to or effects on the Company or its business or operations. The
Company assumes no obligations to update any such forward-looking statements.
14
PART II OTHER INFORMATION
ITEM 1. Legal Proceedings
The Company is not a party to any legal proceedings.
ITEM 2. Changes in Securities and Use of Proceeds
None.
ITEM 3. Defaults upon Senior Securities
None.
ITEM 4. Submission of Matters to a Vote of Security Holders
During the quarter ended June 30, 2000, no matters were submitted to
the Company's security holders.
ITEM 5. Other Information
None.
ITEM 6. Exhibits and Reports on Form 8-K
The Company filed a Current Report dated March 20, 2000 on Form 8-K containing
information pursuant to Item 4 ("Changes in Accountants") entitled "Changes in
Registrant's Certifying Account."
15
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.
eClic, INC.
(Registrant)
Dated: August 11, 2000
/s/ Justine M. Daniels
- -----------------------
Justine M. Daniels
President and Chief Executive Officer
16