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 March 31, 2001
- --------------------------------------------------------------------------
[ ] Transition Report under Section 13 or 15(d)of the Exchange Act For the
Transition Period from ________ to ___________
- --------------------------------------------------------------------------
Commission File Number: 000-31997
Emporia Systems
----------------------------------------------
(Name of Small Business Issuer in its charter)
Nevada 88 0423785
- ------------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
38820 N. 25th Avenue, Phoenix, AZ 85086
------------------------------------------------ -------------
(Address of principal executive offices) (zip code)
1-602-617-4456 (Phone) 1-480-905-8078 (FAX)
---------------------------------------------------
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 25,000,000 Common Stock, authorized, 13,000,000 shares
of Common stock issued and outstanding, par value $0.001 per share as of
March 31, 2001.
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........................ 8-12
Item 2. Management's Discussion and Analysis of Plan
of Operation........................................ 13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.................................... 18
Item 2. Changes in Securities and Use of Proceeds............ 18
Item 3. Defaults upon Senior Securities...................... 18
Item 4. Submission of Matters to a Vote
of Security Holders................................. 18
Item 5. Other Information..................................... 18
Item 6. Exhibits and Reports on Form 8-K...................... 18
Signatures...................................................... 19
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS
The unaudited financial statements of registrant for the three months ended
March 31, 2001, 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 ACCOUNTANT'S REVIEW REPORT
--------------------------------------
Board of Directors
Emporia Systems
(a Development Stage Company)
Las Vegas, NV
I have reviewed the accompanying balance sheet of Emporia Systems (a Nevada
corporation) (a development stage company) as of March 31, 2001 and the
related statements of operations for the three-months ended March 31, 2001
and 2000 and for the period March 2, 1999 (Inception) to March 31, 2001, and
statements of cash flows for the three-month period ending March 31, 2001
and 2000 and for the period March 2, 1999 (Inception) to March 31, 2001.
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 Emporia Systems (a development stage
company) as of December 31, 2000, 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 20, 2001, I expressed
an unqualified opinion on those financial statements.
May 15, 2001
/s/ G. Brad Beckstead
- ----------------------
G. Brad Beckstead, CPA
4
Emporia Systems
(A Development Stage Company)
Balance Sheet
BALANCE SHEET
(unaudited)
March 31, December 31,
2001 2000
----------- ------------
Assets
Current assets:
Cash $ 51,897 $ 22,791
---------- ----------
Total current assets 51,897 22,791
---------- ---------
Fixed assets, net 6,058 6,422
---------- ----------
Total Assets $ 57,955 $ 29,213
========== ==========
Liabilities and Stockholders' Equity
Current liabilities
Accrued interest payable $ 3,334 $ 2,917
---------- ----------
Total current liabilities 3,334 2,917
---------- ----------
Convertible debenture - 50,000
---------- ----------
Total Current Liabilities 3,334 52,917
---------- ----------
Stockholders' Equity:
Common stock, $0.001 par value,
25,000,000 shares authorized,
13,000,000 shares issued
and outstanding 13,000 9,000
Additional paid-in capital 114,000 80,338
Deficit accumulated during
development stage (72,379) (50,704)
---------- ----------
Total stockholders' equity 54,621 (23,704)
---------- ----------
Total Liabilities and Stockholders' Equity $ 57,955 $ 29,213
========== ==========
The Accompanying Notes are an Intregal Part of These Financial Statements.
5
Emporia Systems
(a Development Stage Company)
Statement of Operations
(unaudited)
For the Three Months Ending March 31, 2001 and 2000
and For the Period March 2, 1999 (Inception) to March 31, 2001
STATEMENT OF OPERATIONS
Three Months Ending March 2, 1999
March 31, (Inception) to
-------------------- March 31,
2001 2000 2001
--------- --------- ------------
Revenue $ - $ - $ -
-------- -------- ---------
Expenses:
General administrative expenses 20,894 (4) 67,833
Depreciation and amortization 364 - 1,212
-------- -------- ---------
Total expenses 21,258 (4) 69,045
-------- -------- ---------
Other income/expense:
Interest expense (417) - (3,334)
-------- -------- ----------
(417) - (3,334)
-------- -------- ----------
Net (loss) $(21,675) $ 4 $ (72,379)
========= ======== ==========
Weighted average
number of
common shares
outstanding 13,000,000 9,000,000 6,958,414
========== ========= ==========
Net loss per share $ (0.00) $ (0.00) $ (0.01)
========= ========= ==========
The Accompanying Notes are an Intregal Part of These Financial Statements.
6
Emporia Systems
(A Development Stage Company)
Statement of Cash Flows
For the Three Months Ending March 31, 2001 and 2000
and For the Period March 2, 1999 (Inception) to March 31, 2001
STATEMENT OF CASH FLOWS
Three Months Ending March 2, 1999
March 31, (Inception) to
-------------------- March 31,
2001 2000 2001
--------- --------- ------------
Cash flows from operating activities
Net loss $(21,675) $ 4 $ (72,379)
Adjustments to reconcile net
Loss to net cash provided
(used) by operating activities:
Depreciation and amortization 364 - 1,212
Increase (decrease) in officer advances - - -
Increase in other current liabilities 417 - 3,334
-------- --------- ----------
Net cash used by
operating activities (20,894) 4 (67,833)
-------- --------- ----------
Cash flows from investing activities
Purchase of fixed assets - - (7,270)
Convertible debentures (50,000) - 50,000
-------- --------- ----------
Net cash used
by investing activities (50,000) - 42,730
-------- --------- ----------
Cash flows from financing activities
Issuance of common stock 100,000 - 77,000
-------- --------- ---------
Net cash provided by
financing activities 100,000 - 77,000
-------- --------- ---------
Net (decrease) increase in cash 29,106 4 51,897
Cash - beginning 22,791 30 -
-------- --------- ---------
Cash - ending $ 51,897 $ 34 $ 51,897
======== ======== =========
Supplemental disclosures:
Interest paid $ - $ - $ -
======== ======== =========
Income taxes paid $ - $ - $ -
======== ======== =========
Non-cash investing and financing
activities
Common stock issued for services $ - $ - $ 2,000
======== ======== =========
Number of shares issued for services - - 6,000,000
======== ======== =========
The Accompanying Notes are an Intregal Part of These Financial Statements.
7
Emporia Systems
Notes
Note 1 - Significant accounting policies and procedures
Organization
- ------------
The Company was organized March 2, 1999 (Date of Inception) under the laws
of the State of Nevada, as Emporia Systems. The Company is authorized to
issue 25,000,000 shares of $0.001 par value common stock. The Company has
limited operations, and in accordance with SFAS #7, the Company is
considered a development stage company.
Estimates
- ---------
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 from those
estimates.
Cash and cash equivalents
- -------------------------
The Company maintains a cash balance in a non-interest-bearing account that
currently does not exceed federally insured limits. For the purpose of the
statements of cash flows, all highly liquid investments with an original
maturity of three months or less are considered to be cash equivalents.
Equipment
- ---------
The cost of equipment is depreciated over the following estimated useful
life of the equipment utilizing the straight-line method of depreciation:
Computer equipment 5 years
Revenue recognition
- -------------------
The Company recognizes revenue on an accrual basis as it invoices for
services.
Reporting on the costs of start-up activities
- ---------------------------------------------
Statement of Position 98-5 (SOP 98-5), "Reporting on the Costs of Start-Up
Activities," which provides guidance on the financial reporting of
start-up costs and organizational costs, requires most costs of start-up
activities and organizational costs to be expensed as incurred. SOP 98-5
is effective for fiscal years beginning after December 15, 1998. With
the adoption of SOP 98-5, there has been little or no effect on the
Company's financial statements.
8
Emporia Systems
Notes
Loss per share
- --------------
Net loss per share is provided in accordance with Statement of Financial
Accounting Standards No. 128 (SFAS #128) "Earnings Per Share". Basic loss
per share is computed by dividing losses available to common stockholders
by the weighted average number of common shares outstanding during the
period. The Company had no dilutive common stock equivalents, such as
stock options or warrants as of March 31, 2001.
Advertising Costs
- -----------------
The Company expenses all costs of advertising as incurred. There were no
advertising costs included in selling, general and administrative expenses
in 2001.
Fair value of financial instruments
- -----------------------------------
Fair value estimates discussed herein are based upon certain market
assumptions and pertinent information available to management as of March
31, 2001. The respective carrying value of certain on-balance-sheet
financial instruments approximated their fair values. These financial
instruments include cash and accounts payable. Fair values were assumed
to approximate carrying values for cash and payables because they are
short term in nature and their carrying amounts approximate fair values
or they are payable on demand.
Impairment of long lived assets
- -------------------------------
Long lived assets held and used by the Company are reviewed for possible
impairment whenever events or circumstances indicate the carrying amount
of an asset may not be recoverable or is impaired. No such impairments
have been identified by management at March 31, 2001.
Segment reporting
- -----------------
The Company follows Statement of Financial Accounting Standards No. 130,
"Disclosures About Segments of an Enterprise and Related Information".
The Company operates as a single segment and will evaluate additional
segment disclosure requirements as it expands its operations.
Dividends
- ---------
The Company has not yet adopted any policy regarding payment of dividends.
No dividends have been paid or declared since inception.
9
Emporia Systems
Notes
Recent pronouncements
- ---------------------
The FASB recently issued Statement No. 137, "Accounting for Derivative
Instruments and Hedging Activities-Deferral of Effective Date of FASB
Statement No. 133". The Statement defers for one year the effective date
of FASB Statement No. 133, "Accounting for Derivative Instruments and
Hedging Activities". The rule now will apply to all fiscal quarters of
all fiscal years beginning after June 15, 2000. In June 1998, the FASB
issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities." The Statement will require the company to recognize all
derivatives on the balance sheet at fair value. Derivatives that are not
hedges must be adjusted to fair value through income, if the derivative is
a hedge, depending on the nature of the hedge, changes in the fair value
of derivatives will either be offset against the change in fair value of
the hedged assets, liabilities, or firm commitments through earnings or
recognized in other comprehensive income until the hedged item is
recognized in earnings. The ineffective portion of a derivative's change
in fair value will be immediately recognized in earnings. The company
does not expect SFAS No. 133 to have a material impact on earning s and
financial position.
In December 1999, the Securities and Exchange Commission released Staff
Accounting Bulletin No. 101, Revenue Recognition in Financial Statements
(SAB No. 101), which provides guidance on the recognition, presentation
and disclosure of revenue in financial statements. SAB No. 101 did not
impact the company's revenue recognition policies.
Note 2 - Fixed Assets
The Company has computer equipment in the amount of $7,270 and recorded
depreciation expense in the amount of $364 during the period ended March
31, 2001.
Note 3 - Income taxes
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 expense (benefit) results from the net change
during the year of deferred tax assets and liabilities. There is no
provision for income taxes for the period ended March 31, 2001 due to
net losses and insignificant net income.
10
Emporia Systems
Notes
Note 4 - Stockholder's equity
The Company is authorized to issue 25,000,000 shares of its $0.001 par
value common stock.
All references to shares issued and outstanding reflect the 3-for-1 stock
split effected May 25, 1999.
On March 5, 1999, the Company issued 6,000,000 shares of its $.001 par
value common stock to its officers as founders stock issued for services.
On March 24, 1999, the Company completed its Regulation D, Rule 504 of
the Securities and Exchange Commission Act of 1933, offering. Pursuant
to the offering, the Company issued 3,000,000 of its $.001 par value
common stock for cash totaling $25,000.
On January 12, 2001, the Company issued 2,000,000 shares of its $0.001
par value common stock to holder of the convertible debenture in exchange
for extinguishments of the principal balance in the note. The shares
were converted at a price of $0.025 per share.
On January 17, 2001, the Company issued 2,000,000 shares of its $0.001 par
value common stock for total cash of $50,000 pursuant to Regulation D,
Rule 506 of the SEC 1933 Securities Act, offering.
There have been no other issuances of common 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. However, the Company has not commenced
its planned principal operations. 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 paid its president, George Polyhronopoulos, $3,000 in
consulting fees during the period ended March 31, 2001. Mr.
Polyhronopoulos is also a director and shareholder of the Company.
The Company issued stock to a director and shareholder of the Company in
exchange for the extinguishment of the convertible debenture and via the
offering pursuant to Regulation D, Rule 506.
Office space and services are provided without charge by a director and
shareholder. 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.
11
Emporia Systems
Notes
Note 7 - Convertible debentures
On May 20, 2000, the company executed a 10% Convertible Debenture in the
amount of $50,000. The Note matures June 15, 2002. The principal balance
of the note was converted to common shares of the Company on January 12,
2001 at the rate of $0.025 per share, or 2,000,000 shares. As of the date
of conversion the accrued interest was a total of $3,334, and no interest
payments have been made for the period ended March 31, 2001.
Note 8 - Warrants and options
There are no warrants or options outstanding to acquire any additional
shares of common stock.
12
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATIONS
Emporia Systems, is a developmental stage Company, who plans to market its
products through the Internet, hereinafter referred to as "Emporia Systems"
or the " Company" or the "Registrant", was organized by the filing of
Articles of Incorporation with the Secretary of State of the State of Nevada
on March 02, 1999.Emporia Systems, a Nevada corporation, is a developmental
stage company with a principal business objective to become a world leading
web hosting and E-Commerce solutions company offering a wide range of
services: web site and web store hosting, web server co-location and domain
name registration and to support these services through it's World Wide Web
(www.emporiasystems.com). The Company's web site is currently under
development and the company hopes to have it published in the near future.
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. Such risks include,
without limitation, the lack of broad acceptance of the company's products on
the Internet, the possibility that the Internet will fail to achieve broad
acceptance, the inability of the Company to generate significant e-Commerce
based revenues from Internet customers, the company's inability to
anticipate and adapt to a developing market, the failure of the company's
network infrastructure (including its server, hardware and software) to
efficiently handle its Internet traffic, changes in laws that adversely
affect the company's business, the ability of the Company to manage its
operations, including the amount and timing of capital expenditures and other
costs relating to the expansion of the company's operations, the introduction
and development of different or more extensive communities by direct and
indirect competitors of the Company, including those with greater financial,
technical and marketing resources, the inability of the Company to maintain
and increase levels of traffic to its proposed Web site, the inability of the
Company to attract, retain and motivate qualified personnel and general
economic conditions.
The Company has not its fully developed its business plan or 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
services on its future Web site. As of March 31, 2001, the Company had
an accumulated deficit of ($72,379) 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.
13
The Company's future success is substantially dependent upon continued growth
in the use of the Internet. To generate product sales, advertising sales,
e-Commerce service fees for Emporia Systems, the Internet's recent and rapid
growth must continue, and e-Commerce on the Internet must become widespread.
None of these can be assured. The Internet may prove not to be a viable
commercial marketplace. Additionally, due to the ability of consumers to
easily compare prices of similar products or services on competing Web sites,
gross margins for e-Commerce transactions may narrow in the future and,
accordingly, the Company's revenues from e-Commerce arrangements may be
materially negatively impacted. If use of the Internet does not continue to
grow, the Company's business, results of operations and financial condition
would be materially and adversely affected. Additionally, to the extent that
the Internet continues to experience significant growth in the number of
users and the level of use, there can be no assurance that its technical
infrastructure will continue to be able to support the demands placed upon
it. The necessary technical infrastructure for significant increases in
e-Commerce, such as a reliable network backbone, may not be timely and
adequately developed. In addition, performance improvements, such as
high-speed modems, may not be introduced in a timely fashion. Furthermore,
security and authentication concerns with respect to transmission over the
Internet of confidential information, such as credit cared numbers, may
remain. Issues like these could lead to resistance against the acceptance of
the Internet as a viable commercial marketplace. Also, the Internet could
lose its viability due to delays in the development or adoption of new
standards and protocols required to handle increased levels of activity, or
due to increased governmental regulation. Changes in or insufficient
availability of telecommunications services could result in slower response
times and adversely affect usage of the Internet. Demand and market
acceptance for recently introduced services and products over the Internet
are subject to a high level of uncertainty, and there exist few proven
services and products.
Going Concern - The Company experienced operating losses for the period
ended March 31, 2001. 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.
14
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.
Results of Operations
- ---------------------
During the First Quarter ended March 31, 2001, the Company did not
generate any in revenues. In addition, the Company does not expect to
generate any profit for this coming year.
In its most recent three month operating period ended March 31, 2001, the
Company incurred a net loss of $21,258, this included depreciation and
amortization costs of $364, and general and administrative expenses of
$20,894. During the First Quarter, the Company continued to seek new
strategies for its website. The majority of the Company's expenses for the
Quarter included administrative fees. Since the Company's inception the
Company has lost $72,379. The Company does not have any material
commitments for capital expenditures.
Plan of Operation
- -----------------
Management does not believe the company will generate any profit until
sometime in next Calendar Year as developmental and marketing costs will
most likely exceed any anticipated revenues. Management is still in the
process of developing a customer base for the Company.
The Company believes it has enough monies to sustain itself for the next
twelve months, during this developmental process.
Liquidity and Capital Resources
- -------------------------------
A total of two million (2,000,000) shares of its common stock were purchased
by the founder of the Company, on March 05, 1999 for cash. Between March 22
and March 24, 1999, the Company sold One Million (1,000,000) shares of its
common stock in connection with a public offering at a price of $0.025 per
share. On or about February 24, 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 one
million (1,000,000) shares of the Common Stock of the Company for twenty-five
thousand ($25,000) dollars to approximately twenty-five (25) unaffiliated
shareholders of record. The Company filed an original Form D with the
Securities and Exchange Commission on or about March 24, 1999. On May 20, 2000
the company executed a 10% convertible note payable in the amount of $50,000.
This note bears interest at the rate of 10% per annum. This note matures
June 15, 2002. The note may be converted to common shares of the company at
the rate of $0.025 per share or 2,000,000 shares.
15
On January 12, 2001, the Company issued 2,000,000 shares of its $0.001
par value common stock to holder of the convertible debenture in exchange
for extinguishments of the principal balance in the note. The shares
were converted at a price of $0.025 per share.
On January 17, 2001, the Company issued 2,000,000 shares of its $0.001 par
value common stock for total cash of $50,000 pursuant to Regulation D,
Rule 506 of the SEC 1933 Securities Act, offering. There have been no
other issuances of common stock.
As of March 31, 2001, the Company has thirteen million shares (13,000,000)
shares of its $0.001 par value common voting stock issued and outstanding
which are held by approximately twenty-five (25) shareholders, including
the founding shareholder, of record.
The Company currently has 2 employees who are both officers and directors of
the Company. These employees received no compensation through March 31,
2001. The Company does not plan to hire any additional employees until it
can become an profitable entity.
The Company has no material commitments for capital expenditures nor does it
foresee the need for such expenditures over the next year.
The Company has limited financial resources available, which has had an
adverse impact on the Company's liquidity, activities and operations. These
limitations have adversely affected the Company's ability to obtain certain
projects and pursue additional business. There is no assurance that the
proceeds of the Company will be able to raise sufficient funding to enhance
the Company's financial resources sufficiently to generate volume for the
Company.
Market For Company's Common Stock
The common stock of the Company is currently not traded on the NASDAQ OTC
Bulletin Board or any other formal or national securities exchange. There
is no trading market for the Company's Common Stock at present and there has
been no trading market to date.
There is currently no common stock which is subject to outstanding options
or warrants to purchase, or securities convertible into, the Company's
common stock.
Dividend Policy
The Company has not yet adopted any policy regarding payment of dividends.
No dividends have been paid since inception.
16
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.
17
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 March 31, 2001, no matters were submitted to
the Company's security holders.
ITEM 5. Other Information
None.
ITEM 6. Exhibits and Reports on Form 8-K
3 Articles of Incorporation & By-Laws
(a)Articles of Incorporation of the Company filed February
16, 1999. Incorporated by reference to the exhibits to
the Company's General Form For Registration Of Securities
Of Small Business Issuers on Form 10-SB, previously filed
with the Commission.
(b)By-Laws of the Company adopted March 5, 1999.
Incorporated by reference to the exhibits to the Company's
General Form For Registration Of Securities Of Small
Business Issuers on Form 10-SB, previously filed with the
Commission.
4 Instruments Defining the Rights of Security Holders
(a)Facsimile of specimen common stock certificate,
incorporated by reference to the exhibits to the Company's
General Form For Registration Of Securities of Small
Business Issuers on Form 10-SB, previously filed with the
Commission.
13 Annual or Quarterly Reports
(a) Form 10-KSB for the year ended December 31, 2000.
Incorporated by reference to the Company's Annual
Report for Small Business Issuers on Form 10-KSB,
previously filed with the Commission.
23 Consent of Experts and Counsel
Consent of Independent Public Accountant
18
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.
Date: May 16, 2001 Emporia Systems
---------------------------------
Registrant
By: /s/ Georgios Polyhronopoulos
-----------------------
Georgios Polyhronopoulos
President, Chief Executive Officer
Chief Financial Officer
19