U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB/A
(X) Quarterly report under section 13 or 15(d) of the Securities Exchange Act of
1934 for the quarterly period ended June 30, 2002.
Commission File No: 333-68312
RESERVENET, INC.
(Name of small business in its charter)
DELAWARE 94-3381088
(State or other jurisdiction of Incorporation) (IRS Employer Id. No.)
3701 Sacramento St. #323
San Francisco, CA 94118
(Address of Principal Office) Zip Code
Issuer's telephone number: (415) 752-2578
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities 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
Check whether the issuer has 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 X No
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. At June 30, 2002, the following
shares of common were outstanding: Common Stock, par value of $0.0001, 1,900,000
shares.
Transitional Small Business Disclosure Format (Check one): Yes No X
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS
The unaudited financial statements of registrant for the six months ended June
30, 2002 and June 30, 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 periods presented.
ReserveNet, Inc.
(A Development Stage Company)
Balance Sheet
as of
June 30, 2002
and
Statements of Operations
for the Three Months and Six Months Ending
June 30, 2002 and 2001,
and
for the Period
October 31, 2000 (Inception) to June 30, 2002
and
Cash Flows
for the Six Months Ending
June 30, 2002 and 2001,
and
for the Period
October 31, 2000 (Inception) to June 30, 2002
TABLE OF CONTENTS
Page
Independent Accountants' Review Report 1
Balance Sheet 2
Statements of Operations 3
Statements of Cash Flows 4
Footnotes 5
Beckstead and Watts, LLP
- ------------------------
Certified Public Accountants
3340 Wynn Road, Suite C
Las Vegas, NV 89102
702.257.1984
702.362.0540 fax
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
Board of Directors
ReserveNet, Inc.
(a Development Stage Company)
Las Vegas, NV
We have reviewed the accompanying balance sheet of ReserveNet, Inc. (a Nevada
corporation) (a development stage company) as of June 30, 2002 and the related
statements of operations for the three-months and six-months ended June 30, 2002
and 2001 and for the period October 31, 2000 (Inception) to June 30, 2002, and
statements of cash flows for the six-months ended June 30, 2002 and 2001 and for
the period October 31, 2000 (Inception) to June 30, 2002. These financial
statements are the responsibility of the Company's management.
We conducted our 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, we do not express such an
opinion.
Based on our reviews, we are 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 in the United
States of America.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 2 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 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
G. Brad Beckstead, CPA has previously audited, in accordance with generally
accepted auditing standards, the balance sheet of ReserveNet, Inc. (a
development stage company) as of December 31, 2001, and the related statements
of operations, stockholders' equity, and cash flows for the year then ended (not
presented herein) and in his report dated March 19, 2002, he expressed an
unqualified opinion on those financial statements.
/s/ Beckstead and Watts, LLP
August 18, 2002
1
ReserveNet, Inc.
(a Development Stage Company)
Balance Sheet
(unaudited)
June 30,
2002
---------
Assets
Current assets:
Cash and equivalents $ 343
Due from shareholder 366
---------
Total current assets 709
---------
$ 709
=========
Liabilities and Stockholders' Equity
Current liabilities: $ --
---------
Stockholders' equity:
Common stock, $0.0001 par value, 100,000,000 shares
authorized, 1,900,000 shares issued and outstanding 190
Additional paid-in capital 28,310
(Deficit) accumulated during development stage (27,791)
---------
709
---------
$ 709
=========
The accompanying notes are an integral part of these financial statements.
2
ReserveNet, Inc.
(a Development Stage Company)
(unaudited)
Statements of Operations
Three Months Ending Six Months Ending
June 30, June 30, October 31, 2000
------------------------- ------------------------- (Inception) to
2002 2001 2002 2001 June 30, 2002
----------- ----------- ----------- ----------- -------------
Revenue $ -- $ -- $ -- $ -- $ --
----------- ----------- ----------- ----------- -----------
Expenses:
General and administrative expenses 2,615 3,367 5,266 8,014 26,491
General and administrative expenses - related party 500 -- 500 -- 1,300
----------- ----------- ----------- ----------- -----------
Total expenses 3,115 3,367 5,766 8,014 27,791
----------- ----------- ----------- ----------- -----------
Net (loss) $ (3,115) $ (3,367) $ (5,766) $ (8,014) $ (27,791)
=========== =========== =========== =========== ===========
Weighted average number of
common shares outstanding - basic and fully diluted 1,900,000 1,900,000 1,900,000 1,651,381
=========== =========== =========== ===========
Net (loss) per share - basic & fully diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
=========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements.
3
ReserveNet, Inc.
(a Development Stage Company)
(unaudited)
Statements of Cash Flows
Six Months Ending
June 30, October 31, 2000
--------------------------------------- (Inception) to
2002 2001 June 30, 2002
------------------ ------------------ ---------------------
Cash flows from operating activities
Net (loss) $ (5,766) $ (8,014) $ (27,791)
Adjustments to reconcile net (loss) to
net cash (used) by operating activities:
(Increase) in due from shareholder (1,100) (9,113) (19,527)
Increase in due to shareholder 1,489 6,985 19,161
------------------ ------------------ ---------------------
Net cash (used) by operating activities (5,377) (10,142) (28,157)
------------------ ------------------ ---------------------
------------------ ------------------ ---------------------
Cash flows from investing activities - - -
------------------ ------------------ ---------------------
Cash flows from financing activities
Issuances of common stock - 25,000 28,500
------------------ ------------------ ---------------------
Net cash provided by financing activities - 25,000 28,500
------------------ ------------------ ---------------------
Net increase (decrease) in cash (5,377) 14,858 343
Cash - beginning 5,720 3,575 -
------------------ ------------------ ---------------------
Cash - ending $ 343 $ 18,433 $ 343
================== ================== =====================
Supplemental disclosures:
Interest paid $ - $ - $ -
================== ================== =====================
Income taxes paid $ - $ - $ -
================== ================== =====================
The accompanying notes are an integral part of these financial statements.
4
ReserveNet, Inc.
(a Development Stage Company)
Notes
Note 1 - Basis of presentation
The interim financial statements included herein, presented in accordance with
United States generally accepted accounting principles and stated in US dollars,
have been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations, although the Company believes
that the disclosures are adequate to make the information presented not
misleading.
These statements reflect all adjustments, consisting of normal recurring
adjustments, which, in the opinion of management, are necessary for fair
presentation of the information contained therein. It is suggested that these
interim financial statements be read in conjunction with the financial
statements of the Company for the period ended December 31, 2001 and notes
thereto included in the Company's Form 10-SB. The Company follows the same
accounting policies in the preparation of interim reports.
Results of operations for the interim periods are not indicative of annual
results.
Note 2 - 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 and it has not generated any revenues. In order to obtain the
necessary capital, the Company raised funds via private securities offering. If
the securities offering does not provide sufficient capital, a shareholder of
the Company has agreed to provide sufficient funds as a loan over the next
twelve-month period. However, the Company is dependent upon its ability to
secure equity and/or debt financing and there are no assurances that the Company
will be successful, without sufficient financing it would be unlikely for the
Company to continue as a going concern.
Note 3 - Related party transactions
The Company paid professional fees totaling $500 to an individual, who is an
officer and director of the Company, during the six month period ended June 30,
2002.
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.
5
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Plan of Operation
ReserveNet is a development stage company, whose business plan is to provide
consumer reservation services to the restaurant industry. ReserveNet hopes to
develop a web-based reservation system that allows consumers to place
reservations directly with restaurants through the ReserveNet website. The
company hopes to generate subscription revenue from restaurants and advertising
revenue through its website. Consumers will have the ability to search an
interactive database of available restaurant reservations that can be refined to
a particular geographic location convenient to the consumer. The search could
also be further refined by type of cuisine, average price, and/or favorable
restaurant reviews.
ReserveNet is seeking to raise capital in three tranches; $300,000 , $1,500,000,
and $1,500,000 for a total of $3,300,000 by way of a private equity offering,
debt, or some combination thereof to fund its product development, initial
product rollout, establish offices, pay salaries and purchase capital equipment.
ReserveNet will seek to raise this money in three installments, private
offerings but may seek to undertake a public offering. The company has not
received any additional financing commitments and may rely on funds loaned to it
by its founder and CEO.
Results of Operations
The company has not begun its planned operations. Expenditures since inception
and for the requisite reporting periods have been General and Administrative in
nature. These represent the costs associated with professional fees, phone
expenses, small equipment, and expenses related to investor, engineering and
strategic partnership meetings, among other categories. Currently the company
experiences a cash flow burn rate of roughly $1,000 per month
For the three months ended June 30, 2002 Operating expenses were $3,115 compared
to $3,367 for the comparable period in 2001, while operating expenses were
$5,766 for the six-month period ended June 30, 2002 and $8,014 for the
comparable period. These amounts represent a Net Losses for the company and will
provide tax credits to offset Net Income in future periods As a result of the
lack of operating capital, efforts were made to decrease spending across the
board in all categories including travel, postage, communications, and other
general and administrative expenses.
Liquidity
Management plans to seek bridge financing from its founder and other third
parties to provide for the short-term operating needs of the Company until
permanent equity financing can be realized. The Company expects to raise
additional capital through a private placement equity offering to fund further
development of present and anticipated operations until the Company can
accomplish self-sustaining cash flows. The ability of the company to raise
financing will affect its status as a going concern. There can be no guarantee
or assurance that the Company would be successful in raising additional
proceeds. If additional financing cannot be secured, ReserveNet, Inc. would
likely be unable to continue its proposed business plan.
STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This report contains various forward-looking statements that are based on the
Company's beliefs as well as assumptions made by and information currently
available to the Company. When used in this report, the words "believe,"
"expect," "anticipate," "estimate" and similar expressions are intended to
identify forward-looking statements. Such statements may include statements
regarding seeking business opportunities, payment of operating expenses, and the
like, and are subject to certain risks, uncertainties and assumptions which
could cause actual results to differ materially from projections or estimates
contained herein. Factors which could cause actual results to differ materially
include, among others, unanticipated, unanticipated or unexpected costs and
expenses, competition and changes in market conditions, lack of adequate
management personnel and the like. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those anticipated, estimated or
projected. The Company cautions against placing undue reliance on
forward-looking statements.
PART II
ITEM 1. LEGAL PROCEEDINGS
None.
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
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibit 99.1 - Certification of Chief Executive Officer.
(b) Exhibit 99.2 - Certification of Chief Financial Officer.
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.
RESERVENET, INC.
(Registrant)
Date: August 19, 2002
By: /s/ Daniel Regidor
----------------
Daniel Regidor
President, CEO, Director