U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the Quarterly
Period Ended January 31, 2003
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Commission file number: 000-27333
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AKID CORPORATION
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(Exact name of small business issuer as specified in its charter)
Colorado 84-1493150
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10077 E. County Line Rd., Longmont, Colorado 80501
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(Address of principal executive offices) (Zip Code)
303-772-3316
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(Issuer's telephone number)
7899 West Frost Drive, Littleton, Colorado 80128
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
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State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.
As of January 31, 2003, 1,230,000 shares of common stock, no par value, were
outstanding.
Page
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PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed balance sheet, January 31, 2003 (Unaudited) ........ 3
Condensed statements of operations (Unaudited) -
Three and nine months ended January 31, 2003
and 2002, and for the period from April 9,
1998 (inception) through January 31, 2003 ................. 4
Condensed statements of cash flows (Unaudited) -
Nine months ended January 31, 2003 and 2002,
and for the period from April 9, 1998 (inception)
through January 31, 2003 .................................. 5
Notes to condensed financial statements (Unaudited) .......... 6
Item 2. Plan of Operation .................................... 7
Part II Other Information............................................... 8
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures ............................................................. 9
PART I -- Item 1. Financial Statements
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AKID CORPORATION
(A Development Stage Company)
Condensed Balance Sheet
January 31, 2003
(Unaudited)
Assets
$ --
========
Liabilities and Shareholders' Deficit
Current liabilities:
Accounts payable and accrued liabilities ................. $ 275
Due to related party (Note 2) ............................ 16,315
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Total current liabilities .................. 16,590
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Shareholders' deficit:
Common stock ............................................. 2,800
Additional paid-in capital ............................... 5,673
Deficit accumulated during the development stage ......... (25,063)
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Total shareholders' deficit ................ (16,590)
--------
$ --
========
See accompanying notes to condensed financial statements
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AKID CORPORATION
(A Development Stage Company)
Condensed Statements of Operations
(Unaudited)
April 9, 1998
Three Months Ended Nine Months Ended (inception)
Janaury 31, Janaury 31, Through
-------------------------- -------------------------- January 31,
2003 2002 2003 2002 2003
----------- ----------- ----------- ----------- -----------
Costs and expenses:
Stock-based compensation (Note 2):
Organization costs .................. $ -- $ -- $ -- $ -- $ 500
Contributed rent (Note 2) .............. 300 300 900 900 5,800
Other general and administrative costs . 495 250 2,251 1,581 18,879
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795 550 3,151 2,481 25,179
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Loss before income taxes and interest income (795) (550) (3,151) (2,481) (25,179)
Interest income ........................ -- -- -- -- 116
----------- ----------- ----------- ----------- -----------
Loss before
income taxes ......... (795) (550) (3,151) (2,481) (25,063)
Income tax provision (Note 3) .......... -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Net loss ................ $ (795) $ (550) $ (3,151) $ (2,481) $ (25,063)
=========== =========== =========== =========== ===========
Basic and diluted loss per share ........... $ (0.00) $ (0.00) $ (0.00) $ (0.00)
=========== =========== =========== ===========
Weighted average common shares outstanding . 1,230,000 1,230,000 1,230,000 1,230,000
=========== =========== =========== ===========
See accompanying notes to condensed financial statements
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AKID CORPORATION
(A Development Stage Company)
Condensed Statements of Cash Flows
(Unaudited)
April 9, 1998
Nine Months Ended (inception)
January 31, Through
---------------------- January 31,
2003 2002 2003
-------- -------- --------
Net cash used in operating activities ............. $ (3,976) $ (2,581) $(18,005)
-------- -------- --------
Cash flows from financing activities:
Advances from affiliate (Note 2) .............. 3,976 2,581 16,314
Proceeds from sale of common .................. -- -- 2,300
Payments for offering costs ................... -- -- (127)
-------- -------- --------
Net cash provided by
financing activities ..... 3,976 2,581 18,487
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Net change in cash and
cash equivalents ......... -- -- --
Cash:
Beginning of period
-------- -------- --------
End of period ................................. $ -- $ -- $ --
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Supplemental disclosure of cash flow information:
Cash paid during the period for:
Income taxes ............................... $ -- $ -- $ --
======== ======== ========
Interest ................................... $ -- $ -- $ --
======== ======== ========
See accompanying notes to condensed financial statements
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AKID CORPORATION
(A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)
Note 1: Basis of Presentation
The financial statements presented herein have been prepared by the Company in
accordance with the accounting policies in its audited financial statements for
the year ended April 30, 2002 as filed in its Form 10-KSB and should be read in
conjunction with the notes thereto. The Company entered the development stage in
accordance with Statement of Financial Accounting Standard ("SFAS") No. 7 on
April 9, 1998 and its purpose is to evaluate, structure, and complete a merger
with, or acquisition of, a privately owned corporation.
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) which are necessary to provide a fair presentation of
operating results for the interim periods presented have been made. The results
of operations for the period presented are not necessarily indicative of the
results to be expected for the year.
Interim financial data presented herein are unaudited.
Note 2: Related Party Transactions
Corporate Management Services ("CMS") organized the Company in exchange for
1,000,000 shares of the Company's common stock. The common stock was valued at
$500 by the Company's Board of Directors. CMS may, from time to time, advance to
the Company any additional funds that the Company needs for operating capital
and for costs in connection with searching for or completing an acquisition or
merger.
CMS provides office space at no charge to the Company, on an as needed basis,
for all periods presented in the accompanying financial statements. The
Company's Board of Directors has valued this service at approximately $100 per
month, based on prevailing local market rates. The accompanying financial
statements include a charge to rent expense and a credit to paid-in capital of
$900, $900, and $5,800, respectively, for the nine months ended January 31, 2003
and 2002, and the period from April 8, 1998 (inception) through January 31,
2003.
CMS paid certain administrative costs on behalf of the Company, on an as needed
basis, for all periods presented in the accompanying financial statements. The
costs, consisting of legal, accounting and filing fees, are necessary for the
Company to maintain its reporting status in conformity with the provisions
Securities and Exchange Act of 1934, as amended. At April 30, 2002 the Company
owed CMS $12,339 for certain expenses paid by CMS on behalf of the Company.
During the nine months ended January 31, 2003 CMS paid an additional $3,976 in
legal, accounting, and general and administrative costs on behalf of the
Company, which resulted in a liability to CMS at January 31, 2003 of $16,315
(see Note 4). This liability is referred to as due to related party in the
accompanying condensed financial statements.
Note 3: Income Taxes
The Company records its income taxes in accordance with Statement of Financial
Accounting Standard No. 109, "Accounting for Income Taxes". The Company incurred
net operating losses during the periods shown on the condensed financial
statements resulting in a deferred tax asset, which was fully allowed for,
therefore the net benefit and expense result in $-0- income taxes.
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AKID CORPORATION
(A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)
Note 4: Subsequent Event
Common Stock Purchase Agreement
On February 21, 2003, the Company, CMS and Mr. James Wiegand executed a common
stock purchase agreement (the "Agreement"). Mr. Wiegand purchased 750,000 shares
of the Company's common stock, previously owned by CMS, and effectively took
over control of the Company.
On February 21, 2003, pursuant to the Agreement, CMS forgave the $16,315 owed by
the Company. The debt forgiveness was considered a contribution to additional
paid-in capital in February 2003.
Letter of Intent
On February 23, 2003, the Company and ACTON International, Ltd. ("ACTON")
entered into a Letter of Intent whereby ACTON plans to merge into either ACTON
Acquisition Corp, to be formed as a subsidiary of the Company, or directly into
the Company. Under either event, ACTON would be merged into the Company. The
Letter of Intent includes the following terms:
1. Upon receipt of $15,000 cash earnest money, the Company will execute a 2
for 1 reverse common stock split.
2. Immediately prior to closing the transaction, ACTON will cause the purchase
of 100,000 shares (post reverse split) of Mr. Wiegand's shares of the
Company's stock for $37,500.
3. Subsequent to closing the transaction, the Company's original shareholders
will own 3.5 percent of the reconstituted company. In the event that the
shares of the reconstituted company fail to trade on the OTCBB prior to
September 30, 2003, the Company's original shareholders will each return
one-half of their shares for cancellation, unless the delay is related to
the responsibilities of ACTON.
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Part I-- Item 2. Plan of Operation
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The Company's plan of operation is to complete a planned merger with ACTON
International, Ltd., a Nebraska corporation. The Company has one part time
employee, incurs minimal rent and administrative expenses, and has no other
recurring operational expenses except professional fees incurred as necessary.
The Company's president devotes time as required to the affairs of the Company.
Selection of an appropriate business opportunity is complex and risky due to the
Company's limited financial resources, the speculative nature of operations,
management's limited time commitment to the Company, management's potential
conflicts of interest, the burdens of being a reporting company, lack of market
research, and competition in the marketplace.
The Company's success is dependent consummating the business combination it has
entered into with ACTON and there are no assurances that this will occur.
Part II - Other Information
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Items 1 through 4
No response required.
Item 5: other Information.
On February 26, 2003, the Company and ACTON International, Ltd. ("ACTON")
entered into a Letter of Intent whereby ACTON plans to merge into either ACTON
Acquisition Corp, to be formed as a subsidiary of the Company, or directly into
the Company. Under either event, ACTON would be merged into the Company. The
Letter of Intent includes the following terms:
1. Upon receipt of $15,000 cash earnest money, the Company will execute a 2
for 1 reverse common stock split.
2. Immediately prior to closing the transaction, ACTON will cause the purchase
of 100,000 shares (post reverse split) of Mr. Wiegand's shares of the
Company's stock for $37,500.
3. Subsequent to closing the transaction, the Company's original shareholders
will own 3.5 percent of the reconstituted company. In the event that the
shares of the reconstituted company fail to trade on the OTCBB prior to
September 30, 2003, the Company's original shareholders will each return
one-half of their shares for cancellation, unless the delay is related to
the responsibilities of ACTON.
Item 6: Exhibits and Reports on Form 8-K
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(a). Exhibits:
1. 2.1: Binding Letter of Intent
2. 99.1: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 - CEO
3. 99.2: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 - CFO
(b) Reports on Form 8-K
On March February 28, 2003, we filed a Report on Form 8-K to
report a change in control of Registrant. Our report on Form 8-K is
hereby incorporated by reference.
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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.
Akid Corporation.
Date: March 17, 2003 By: /s/ James B. Wiegand
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James B. Wiegand, President/Secretary
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