U.S. 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 QUARTERLY PERIOD ENDED MARCH
31, 2002
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: 333-56848
PRE-SETTLEMENT FUNDING CORPORATION
(Exact name of Company as specified in its charter)
Delaware 54-1965220
(State or jurisdiction of incorporation (I.R.S. Employer
or organization Identification No.)
927 South Walter Reed Drive, Suite 5, Arlington, VA 22204
(Address of principal executive offices) (Zip Code)
Company's telephone number: (703) 892-4123
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common
Stock, $0.001 Par Value
Indicate by check mark whether the Company (1) 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 period that the Company was required to file such reports),
and (2) been subject to such filing requirements for the past 90
days. Yes X No___
Indicate the number of shares outstanding of each of the issuer's
class of common stock. The Registrant had 5,368,000 shares of its
common stock outstanding as of July 1, 2002.
TABLE OF CONTENTS
Part I - Financial Information Page
Item 1. Financial Statements (Unaudited)
Condensed Balance Sheets:
Condensed Statements Of Operations:
Condensed Statements Of Cash Flows:
Notes To Unaudited Condensed Financial Information
Item 2. Management's Discussion And
Analysis Of Financial Condition
Or Plan Of Operations
Part II - Other Information
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
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED).
PRE-SETTLEMENT FUNDING CORPORATION
(A Development Stage Company)
CONDENSED BALANCE SHEETS
(UNAUDITED)
March 31 December 31
2002 2001
ASSETS
Current assets:
Cash and equivalents $ 1,975 $ 1,003
Loans receivable 4,222 15,099
Claims advances 12,000 5,250
Prepaid expenses and other - 1,038
Total current assets 18,197 22,390
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Accounts payable and accrued liabilities 640,294 533,093
Advances from shareholder 20,687 16,225
Total Current Liabilities 660,981 549,318
Commitments and Contingencies - -
Deficiency in Stockholders' Equity
Preferred stock, par value, $.001 per share;
100,000 shares authorized; none issued and
outstanding at March 31, 2002 and
December 31, 2001 - -
Common stock, par value, $.001 per share;
19,900,000 shares authorized ; 5,368,000
shares issued and outstanding at March 31,
2002 and December 31, 2001 5,368 5,368
Additional paid-in-capital 183,652 183,652
Deficit accumulated during development
stage (831,804) (715,948)
Deficiency in stockholder's equity (642,784) (526,928)
18,197 22,390
See accompanying notes to unaudited condensed financial information
PRE-SETTLEMENT FUNDING CORPORATION
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Period
For The Three Months October 14
Ended March 31 1999 (Date of
Inception) to
2002 2001 March 31 2002
Revenues: $ 2,975 $ - $ 9,025
Costs and Expenses:
Selling, general and administrative 118,843 187,294 843,324
Total Cost and Expense 118,843 187,294 843,324
Other Income:
Interest and other 12 300 2,495
Loss from operations (115,856) (186,994) (831,804)
Income (taxes) benefit - - -
Net Loss (115,856) (186,994) (831,804)
Loss per common share (basic
and assuming dilution) (0.02) (0.04) (0.19)
Weighted average shares
Outstanding Basic and Diluted 5,368,000 5,302,000 4,469,031
See accompanying notes to the unaudited condensed financial information
PRE-SETTLEMENT FUNDING CORPORATION
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For The Period
For The Three Months October 14
Ended March 31 1999 (Date of
Inception) to
2002 2001 March 31 2002
Cash flows (used in)/provided by operating
activities:
Net loss $ (115,856) $ (186,994) $ (831,804)
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Common Stock issued to founders - 5,020 5,020
Common Stock issued in exchange for services - 45,000 45,000
(Increase) decrease in:
Loans receivable 10,877 (9,945) (4,222)
Claims advances (6,750) (1,000) (12,000)
Prepaid expenses and other 1,038 1,700 -
Increase (decrease) in:
Accounts payable and accrued expenses, net 107,201 110,295 640,294
Net cash used in operating activities (3,490) (35,294) (157,712)
Cash flows (used in)/provided by investing
activities: - - -
Cash flows (used in)/provided by financing
activities:
Proceeds from issuance of capital notes, net - 15,000 139,000
Shareholder advances (repayments) 4,462 - 20,687
Net cash provided by financing activities 4,462 15,000 159,687
Net increase (decrease) in cash and equivalents 972 (20,924) 1,975
Cash and cash equivalents at beginning of period 1,003 22,207 -
Cash and cash equivalents at end of period 1,975 1,283 1,975
Supplemental Information:
Cash paid during the period for interest - - -
Cash paid during the period for taxes - - -
Common Stock issued in exchange for
capital notes - 87,000 139,000
Common Stock issued to founders in
exchange for services - 5,020 5,020
Common Stock issued in exchange for services - 45,000 45,000
See accompanying notes to unaudited condensed financial information
PRE-SETTLEMENT FUNDING CORPORATION
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL INFORMATION
MARCH 31, 2002
(UNAUDITED)
NOTE A - SUMMARY OF ACCOUNTING POLICIES
General
The accompanying unaudited condensed financial statements have been
prepared in accordance with the instructions to Form 10-QSB, and
therefore, do not include all the information necessary for a fair
presentation of financial position, results of operations and cash
flows in conformity with generally accepted accounting principles.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three-month period ended
March 31, 2002 are not necessarily indicative of the results that may
be expected for the year ended December 31, 2002. The unaudited
condensed financial statements should be read in conjunction with the
consolidated December 31, 2001 financial statements and footnotes
thereto included in the Company's SEC Form 10KSB.
Business and Basis of Presentation
Pre-Settlement Funding Corporation (the "Company") was formed on
October 14, 1999 under the laws of the state of Delaware. The
Company is a development stage enterprise, as defined by Statement of
Financial Accounting Standards No. 7 ("SFAS No. 7") and is seeking to
provide financing to plaintiffs who are involved in personal injury
claims. From its inception through the date of these financial
statements the Company has recognized limited revenues and has
incurred significant operating expenses.
Reclassification
Certain prior period amounts have been reclassified for comparative purposes.
Recent Accounting Pronouncements
In July 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 141, "Business
Combinations" (SFAS No. 141), and Statement of Financial Accounting
Standards No. 142, "Goodwill and Other Intangible Assets" (SFAS No.
142). The FASB also issued Statement of Financial Accounting Standards
No. 143, "Accounting for Obligations Associated with the Retirement of
Long-Lived Assets" (SFAS No. 143), and Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" (SFAS No. 144), in August and October
2001, respectively.
SFAS No. 141 requires the purchase method of accounting for business
combinations initiated after June 30, 2001 and eliminates the pooling-
of-interest method. The adoption of SFAS No. 141 had no material
impact on the Company's financial statements.
Effective January 1, 2002, the Company adopted SFAS No. 142. Under the
new rules, the Company will no longer amortize goodwill and other
intangible assets with indefinite lives, but such assets will be
subject to periodic testing for impairment. On an annual basis, and
when there is reason to suspect that their values have been diminished
or impaired, these assets must be tested for impairment, and write-
downs to be included in results from operations may be necessary. SFAS
No. 142 also requires the Company to complete a transitional goodwill
impairment test six months from the date of adoption.
Any goodwill impairment loss recognized as a result of the
transitional goodwill impairment test will be recorded as a cumulative
effect of a change in accounting principle no later than the end of
fiscal year 2002. The adoption of SFAS No. 142 had no material impact
on the Company's financial statements.
SFAS No. 143 establishes accounting standards for the recognition and
measurement of an asset retirement obligation and its associated asset
retirement cost. It also provides accounting guidance for legal
obligations associated with the retirement of tangible long-lived
assets. SFAS No. 143 is effective in fiscal years beginning after June
15, 2002, with early adoption permitted. The Company expects that the
provisions of SFAS No. 143 will not have a material impact on its
results of operations and financial position upon adoption. The
Company plans to adopt SFAS No. 143 effective January 1, 2003.
SFAS No. 144 establishes a single accounting model for the impairment
or disposal of long-lived assets, including discontinued operations.
SFAS No. 144 superseded Statement of Financial Accounting Standards
No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of" (SFAS No. 121), and APB Opinion
No. 30, "Reporting the Results of Operations - Reporting the Effects
of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions". The Company adopted
SFAS No. 144 effective January 1,2002. The adoption of SFAS No. 144
had no material impact on Company's financial statements.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND PLAN OF OPERATIONS.
The following Management Discussion and Analysis should be read in
conjunction with the un-audited financial statements and accompanying
notes included in this Form 10-QSB and in the audited financial
statements for the year ended December 31, 2001 included in our filing
on Form 10-KSB filed with the Securities and Exchange Commission on
April 16, 2002.
The following discussion contains forward-looking statements that are
subject to significant risks and uncertainties about us, our current
and planned products, our current and proposed marketing and sales,
and our projected results of operations. There are several important
factors that could cause actual results to differ materially from
historical results and percentages and results anticipated by the
forward-looking statements. We have sought to identify the most
significant risks to its business, but cannot predict whether or to
what extent any of such risks may be realized nor can there be any
assurance that we have identified all possible risks that might
arise. Investors should carefully consider all of such risks before
making an investment decision with respect to our stock. The
following discussion and analysis should be read in conjunction with
the financial statements of our Company and notes thereto. This
discussion should not be construed to imply that the results
discussed herein will necessarily continue into the future, or that
any conclusion reached herein will necessarily be indicative of
actual operating results in the future. Such discussion represents
only the best present assessment from our Management.
Plan of Operation
Pre-settlement Funding Corp is still in the development stage and has
earned only a small amount of revenue, approximately $9,000, from
operations. We have funded approximately 27 cases to
date and we anticipate that after the completion of our public
offering, we can substantially increase the number of cases we fund.
During the next twelve months we intend to develop our business of
advancing cash to plaintiffs involved in personal injury claims, as
well as to plaintiffs involved in other types of claims such as
divorce cases. The further development of this business will include,
but not be limited to, developing marketing materials, renting
additional office space, and interviewing and hiring administrative,
marketing and claims personnel. We may experience fluctuations in
operating results in future periods due to a variety of factors
including, but not limited to, market acceptance of our services,
incomplete or inadequate underwriting of our cases, Our ability to
obtain additional financing in a timely manner and on terms favorable
to us, our ability to successfully integrate prospective asset
acquisitions to its existing business operation, delays or errors in
our ability to upgrade and develop our systems and infrastructure in a
timely and effective manner, technical difficulties, system downtime
or utility brownouts, our ability to attract customers at a steady
rate and maintain customer satisfaction, seasonality of advertising
sales, the amount and timing of operating costs and capital
expenditures relating to the expansion of our business, operations and
infrastructure and the implementation of marketing programs, key
agreements and strategic alliances, the number of products offered by
Pre-settlement Funding, and general economic conditions specific to
the personal injury lawsuit industry.
For the period from our inception through March 31, 2002, we have:
- Formed our company and established our initial structure
- Researched the market for litigation funding services and the
activities of our competitors
- Researched potential legal barriers to implementing our business
plan
- Ran print ads in a local advertisement circular
- Developed our website which was completed in 2001
- Entered into consulting agreements with various service providers
- Reviewed and analyzed the cases of several potential clients
- Issued cash advances to 32 clients
- Settled and received proceeds with respect to 27 cases
Our website has generated minimum potential business activity to date.
O OOur activities will continue to be limited unless and until
we receive further financing, either through equity or debt financing.
Without these proceeds, we will not have the capital resources or
liquidity to:
- Implement the business plan;
- Commence operations through the advancement of cash to qualified
customers; or
- Hire any additional employees.
Operating Data
The table below provides a summary of the key operating metrics we use to
assess our operational performance
Quarter Ending March 31 % Year Ended Annualized %
2002 2001 Change Dec 31 2001 Change
Operating data
Cases outstanding 15 0 - 10 50%
Cases settled in period 8 0 - 19 68.4%
Advances in period 13 1 1,200% 19 173.7%
Value of advances $10,500 $1,000 950% 11,950 251.5%
Value of settlements 6,725 0 - 12,750 111.0%
Value of advances for
cases settled 3,750 0 - 6,700 123.9%
Margin on cases settled (a) 2,975 0 - 6,050 96.7%
% Margin on cases settled 44.2% 0% - 47.5% (6.9)%
Average revenue per customer (b) 372 0 0% 318 17.0%
Employees 2 2 0% 2 0%
We define certain business metrics used above as follows:
(a) Margin on cases settled is equivalent to the revenue reported
on the income statement
(b) Average revenue per customer is defined as net revenue per
income statement divided by the number of cases settled in period
Comparison of Financial Results
Three Months Ended March 31, 2002 versus Three Months Ended March 31, 2001
Revenues
Revenue represents the net proceeds to Pre-settlement Funding from the
settlement of cases. We have generated modest revenues from operations
from inception of our business. During the quarter ended March 31,
2002, we have generated $2,975 in revenues from monetary settlements,
as compared to $0 revenues for the quarter ended March 31, 2001. We
began advancing funds to personal injury plaintiffs in February 2001.
We began recognizing revenues from the realization and receipt of
monetary settlements related to the settlement of these specific
litigation claims during the last six months of 2001. In the quarter
ended March 31, 2002 we have made advances totaling $10,500 with
regard to 13 new cases and settled 8 cases with a value of $6,725
compared to 1 case advanced at a value of $1000 in the quarter ended
March 31, 2001 with no settlements. The margin achieved on net
settlements has deteriorated slightly from that achieved for the year
ended December 31, 2001, falling from 47.5% to 44.2%, however the
volume of cases settled has increased on a pro-rata basis by 68.4%.
Our ability to increase the rate of advances in future periods, and
hence the growth in our revenue may be limited by the availability of
funding. If we are funded with proceeds from our offering of equity,
we believe Pre-settlement Funding will begin earning additional
revenues from operations within the next twelve months as it
transitions from a development stage company to that of an active
growth stage company.
Costs and Expenses
From our inception through March 31, 2002, we have incurred expenses
of $843,324 during this period. These expenses were associated
principally with stock issuances to our founders, legal, consulting
and accounting fees and costs in connection with the development of
our business plan, market research, and the preparation of our
registration statement. Total operating expenses in the quarter ended
March 31, 2002 were $118,843, compared to $187,294 in March 31,2001. Based on
our review of costs, 29% of the costs incurred in the quarter ended March
31, 2002 were related to our stock issuance, funding and development
of business plan expenses, compared to 52% in the quarter ended March
31, 2001. Cost were higher in the quarter ended March 31, 2001,
compared to the current quarter, primarily due to $25,000 in
consulting fees associated with developing the business plan,
approximately $37,000 associated with the write off of notes and their
conversion to equity, higher costs for accounting fees associated with
the issuance of equity, cancellation of notes and registration
statement preparation.
Liquidity and Capital Resources
As of March 31, 2002, we had a working capital deficit of $642,784.
As a result of our operating losses from our inception through March
31, 2002, we generated a cash flow deficit of $157,712 from operating
activities. We met our cash requirements during the quarter ended
March 31, 2002 through $15,339 advances and loan repayments from our
principal shareholders. Our accounts payable, which is composed
predominantly of liabilities to our accountants and lawyers in
connection with our registration statement, stands at $195,553 at
March 31, 2002. Accrued payroll, representing liabilities to our two
employees, stands at $444,739 at March 31, 2002.
While we have raised the capital necessary to meet our working capital
and financing needs in the past, additional financing is required in
order to meet our current and projected cash flow deficits from
operations and development. We are seeking financing in the form of
equity in order to provide the necessary working capital. Current
market conditions, however, make it more difficult to raise equity
through a public offering. The current focus of our efforts is to seek
an equity infusion form a private investor that will meet our
requirements. We currently do not have any commitments for financing.
There are no assurances we will be successful in raising the funds required.
We believe that it may be necessary to raise up to One Million Dollars
to implement our business plan over the course of the next twelve
months, though we plan to use our existing capital resources and these
resources may be sufficient to fund our current level of operating
activities, capital expenditures, debt and other obligations through
the next 12 months.
If during that period or thereafter, we are not successful in
generating sufficient liquidity from operations or in raising
sufficient capital resources, on terms acceptable to us, this could
have a material adverse effect on our business, results of operations
liquidity and financial condition.
We believe that if the minimum proceeds are raised from a private
equity or debt source, sufficient capital will exist to fund our
operations, capital expenditures, debt, and other obligations for the
next twelve months. Operations will be adjusted to this level of
capitalization. Although we are dependent upon our success in
securing a private investor to carry out our business plan, if we are
unsuccessful, we will seek to obtain financing through other sources.
Our independent certified public accountants have stated in their
report included in our December 31, 2001 Form 10-KSB, that we have
incurred operating losses since its inception, and that we are
dependent upon management's ability to develop profitable operations.
These factors among others may raise substantial doubt about our
ability to continue as a going concern.
Product Research and Development
We do not anticipate performing research and development for any
products during the next twelve months.
Acquisition or Disposition of Plant and Equipment
We do not anticipate the sale of any significant property, plant or
equipment during the next twelve months. We do not anticipate the
acquisition of any significant property, plant or equipment during the
next 12 months, other than computer equipment and peripherals used in
our day-to-day operations. We believe we have sufficient resources
available to meet these acquisition needs.
Number of Employees
As of March 31, 2002, we have two employees. In order for us to
attract and retain quality personnel, we anticipate we will have to
offer competitive salaries to future employees. We anticipate
increasing our employment base to four (4) to six (6) full and/or
part-time employees during the next 12 months. This projected
increase in personnel is dependent upon the generating revenues and
obtaining sources of financing. As we continue to expand, we will
incur additional costs for personnel. There are no assurances we will
be successful in raising the funds required or generating revenues
sufficient to fund the projected increase in the number of employees.
Trends, Risks and Uncertainties
We have sought to identify what we believe to be the most significant
risks to its business as discussed in "Risk Factors" above, but cannot
predict whether or to what extent any of such risks may be realized
nor can there be any assurances that we have identified all possible
risks that might arise. Investors should carefully consider all of
such risk factors before making an investment decision with respect to
our stock.
Limited operating history; anticipated losses; uncertainly of future results
We have only a limited operating history upon which an evaluation of
our business and its prospects can be based. Our prospects must be
evaluated with a view to the risks encountered by a company in an
early stage of development, particularly in light of the uncertainties
relating to the litigation funding which we intend to market and the
acceptance of our business model. We will be incurring costs to
develop, introduce and enhance our litigation funding services and
products, to develop and market an interactive website, to establish
marketing relationships, to acquire and develop products that will
complement each other, and to build an administrative organization. To
the extent that such expenses are not subsequently followed by
commensurate revenues, our business, results of operations and
financial condition will be materially adversely affected. There can
be no assurance that we will be able to generate sufficient revenues
from the sale of our services and other product candidates. We expect
negative cash flow from operations to continue for the next 12 months
as we continue to develop and market our products. If cash generated
by operations is insufficient to satisfy our liquidity requirements,
we may be required to sell additional equity or debt securities. The
sale of additional equity or convertible debt securities would result
in additional dilution to our shareholders.
Potential fluctuations in quarterly operating results
Our quarterly operating results may fluctuate significantly in the
future as a result of a variety of factors, most of which are outside
our control, including: the level of public acceptance of our
litigation support services and products, the demand for our
litigation support services and products; seasonal trends in demand;
the amount and timing of capital expenditures and other costs relating
to the expansion of our operations; the introduction of new services
and products by Pre-settlement Funding or its competitors; price
competition or pricing changes in the industry; technical
difficulties; general economic conditions, and economic conditions
specific to the litigation funding market. Our quarterly results may
also be significantly affected by the impact of the accounting
treatment of acquisitions, financing transactions or other matters.
Particularly at our early stage of development, such accounting
treatment can have a material impact on the results for any quarter.
Due to the foregoing factors, among others, it is likely that our
operating results will fall below our expectations or investors'
expectations in some future quarter.
Management of Growth
We expect to experience significant growth in the number of employees
relative to its current levels of employment and the scope of its
operations. In particular, we intend to hire claims adjustors, sales,
marketing, and administrative personnel. Additionally, acquisitions
could result in an increase in employee headcount and business
activity. Such activities could result in increased responsibilities
for management. We believe that our ability to increase our customer
support capability and to attract, train, and retain qualified
technical, sales, marketing, and management personnel, will be a
critical factor to our future success. In particular, the availability
of qualified sales, insurance claims, and management personnel is
quite limited, and competition among companies to attract and retain
such personnel is intense. During strong business cycles, we expects
to experience difficulty in filling its needs for qualified sales,
claims adjustors, and other personnel.
Our future success will be highly dependent upon our ability to
successfully manage the expansion of our operations. Our ability to
manage and support our growth effectively will be substantially
dependent on our ability to implement adequate financial and
management controls, reporting systems, and other procedures and hire
sufficient numbers of financial, accounting, administrative, and
management personnel. We are in the process of establishing and
upgrading its financial accounting and procedures. There can be no
assurance that we will be able to identify, attract, and retain
experienced accounting and financial personnel. Our future operating
results will depend on the ability of our management and other key
employees to implement and improve our systems for operations,
financial control, and information management, and to recruit, train,
and manage its employee base. There can be no assurance that we will
be able to achieve or manage any such growth successfully or to
implement and maintain adequate financial and management controls and
procedures, and any inability to do so would have a material adverse
effect on our business, results of operations, and financial condition.
Our future success depends upon our ability to address potential
market opportunities while managing our expenses to match our ability
to finance our operations. This need to manage our expenses will
place a significant strain on our management and operational
resources. If we are unable to manage our expenses effectively, our
business, results of operations, and financial condition will be
materially adversely affected.
Risks associated with acquisitions
Although we are do not presently intend to do so, as part of our
business strategy in the future, we could acquire assets and
businesses relating to or complementary to our operations. Any
acquisitions by Pre-settlement Funding would involve risks commonly
encountered in acquisitions of companies. These risks would include,
among other things, the following: we could be exposed to unknown
liabilities of the acquired companies; we could incur acquisition
costs and expenses higher than it anticipated; fluctuations in our
quarterly and annual operating results could occur due to the costs
and expenses of acquiring and integrating new businesses or
technologies; we could experience difficulties and expenses in
assimilating the operations and personnel of the acquired businesses;
our ongoing business could be disrupted and its management's time and
attention diverted; we could be unable to integrate successfully.
PART II.
ITEM 1. LEGAL PROCEEDINGS.
Other than as set forth below, the Company is not a party to any
material pending legal proceedings and, to the best of its knowledge,
no such action by or against the Company has been threatened.
The Company is subject to other legal proceedings and claims that
arise in the ordinary course of its business. Although occasional
adverse decisions or settlements may occur, the Company believes that
the final disposition of such matters will not have material adverse
effect on its financial position, results of operations or liquidity.
ITEM 2. CHANGES IN SECURITIES.
Sales of Unregistered Securities.
The Registrant had no sales of unregistered securities during the
three-month period ending March 31, 2002.
Use of Proceeds.
Not Applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were not any matters submitted requiring a vote of security
holders during the three- month period ending March 31, 2002.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Reports on Form 8-K. No reports on Form 8-K were filed
during the three-month period covered in this Form 10-QSB.
(b) Exhibits. There have not been any documents that are to be
attached as Exhibits entered into during the three-month period
covered in this Form 10-QSB and therefore, all Exhibits have been
previously filed by the Company.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly
authorized.
Pre-Settlement Funding Corp.
Dated: July 15, 2002 By: /s/ Darryl Reed
Darryl Reed, President