UNITED STATES
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 September 30, 2003
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT For the transition period from __________ to ___________
Commission file number: 333-46828
CLIXTIX, INC.
(Exact name of small business issuer as specified in its charter)
New York 13-3526402
(State or other jurisdiction of (IRS Employer
Identification No.)
incorporation or organization)
Suite 1807-1501 Broadway, New York, NY 10036
(Address of principal executive offices)
(212) 768-2990
(Issuer's telephone number)
PHYLLIS MAXWELL'S GROUPS, INC.
(Former name, former address and former fiscal year, if
changed since last report)
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS 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
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
10,228,000 shares of common stock outstanding as of September 30, 2003
Transitional Small Business Disclosure Format (Check One):Yes[_] No[X]
1
CLIXTIX, INC
FORM 10-QSB
INDEX
PART I - FINANCIAL INFORMATION...............................................3
Item 1. Financial Statements....................................3
INDEPENDENT ACCOUNTANT'S REVIEW REPORT.................................3
CONSOLIDATED BALANCE SHEETS............................................4
CONSOLIDATED STATEMENTS OF OPERATIONS..................................5
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY........................6
CONSOLIDATED STATEMENTS OF CASH FLOWS..................................7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.............................8
Item 2. Management's Discussion and Analysis or Plan of Operation.....9
Item 3. Controls and Procedures..........................................15
PART II - OTHER INFORMATION.................................................16
Item 1. Legal Proceedings................................................16
Item 2. Changes in Securities and Use of Proceeds........................16
Item 3. Defaults Upon Senior Securities..................................16
Item 4. Submission of Matters to a Vote of Security Holders..............16
Item 5. Other Information................................................16
Item 6. Exhibits and Reports on Form 8-K.................................16
SIGNATURE PAGE........................................................17
CERTIFICATIONS........................................................17
2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
INDEPENDENT ACCOUNTANT'S REVIEW REPORT
To the Board of Directors and Stockholders
Clixtix, Inc. and Subsidiary
Formerly Phyllis Maxwell's Group, Inc.)
1501 Broadway
Suite 1807
New York, NY 10036
I have reviewed the accompanying consolidated balance sheet of Clixtix,Inc. and
Subsidiary(Phyllis Maxwell's Group, Inc.) as of September 30, 2003 and the
related consolidated statements of operations for the three and nine month
periods ended September 30, 2003 and 2002, and the consolidated statements of
stockholders' equity and cash flows for the nine month period ended September
30, 2003 and 2002. These consolidated financial statements are the
responsibility of the Company's management.
I conducted my review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally ofapplying 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 auditing standards generally accepted in the United States
of America, the objective of which is the expression of an opinion regarding
the consolidated financial statements taken as a whole. Accordingly, I do not
express such an opinion.
Based on my review, I am not aware of any material modifications that should be
made to the accompanying consolidated financial statements for them to be
in conformity with accounting principles generally accepted in the United
States of America.
I have previously audited, in accordance with auditing
standards generally accepted in the United States of America, the
consolidated balance sheet of Clixtix, Inc. and Subsidiary (Formerly
Phyllis Maxwell's Group, Inc.) as of December 31, 2002, presented herein,
and the related consolidated statements of operations, stockholders' equity
and cash flows for the year then ended not presented herein; and in my
report dated February 27, 2003 which an unqualified opinion was expressed
on those consolidated financial statements.
/s/ "Richard M. Prinzi, Jr."
Brooklyn, NY
November 10, 2003
3
Clixtix, Inc and Subsidiary
(Formerly Phyllis Maxwell's Groups, Inc.)
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2003 2002
---------------------- ---------------------
(Unaudited)
ASSETS
Current Assets:
Cash $ 11,845 $ 52,406
Commissions receivable 94,082 71,203
Other assets 2,654 2,654
---------------------- ---------------------
Total current assets 108,581 126,263
Long Term Assets:
Goodwill VC 164,000 -
---------------------- ---------------------
Total assets $ 272,581 $ 126,263
====================== =====================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 57,880 $ 99,951
Commission payable 27,664 -
Current portion of
long term debt 36,667 -
Other payables 8,350 -
---------------------- ---------------------
Total current liabilities 130,561 99,951
---------------------- ---------------------
Long-Term Liabilities:
Loan Payable VC 73,333 -
Officer loans 44,000 -
---------------------- ---------------------
Total liabilities 247,894 99,951
---------------------- ---------------------
Commitments
Stockholders' equity
Common stock, $.001par value; 20,000,000
shares authorized, 10,228,000 shares issued
and outstanding at September 30, 2003 $ 20,973 $ 20,973
Additional paid-in capital 34,058 34,058
Retained earnings (30,344) (28,719)
---------------------- ---------------------
Total stockholders' equity 24,687 26,312
---------------------- ---------------------
Total liabilities and stockholders' equity $ 272,581 $ 126,263
====================== =====================
See accountant's review report and notes to consolidated financial statements.
4
Clixtix, Inc and Subsidiary
(Formerly Phyllis Maxwell's Groups, Inc.)
CONSOLIDATED STATEMENTS OF OPERATIONS
Nine months Three months Three months
ended September Nine months ended ended September ended September
30, 2003 September 30, 2002 30, 2003 30, 2002
------------------ -------------------- ------------------ -------------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Commission revenue $ 162,421 $ 197,816 $ 81,659 $ 33,104
General and administrative expenses 165,019 219,224 69,014 74,759
------------------ -------------------- ------------------ -------------------
Income (loss) from operations (2,598) (21,408) 12,645 (41,655)
Interest income 973 377 896 111
------------------ -------------------- ------------------ -------------------
Income (loss) before income taxes (1,625) (21,031) 13,541 (41,544)
------------------ -------------------- ------------------ -------------------
Income taxes (benefit):
Current - 6,200 - -
Deferred - 10,800 - -
------------------ -------------------- ------------------ -------------------
Total Income taxes - 17,000 - -
------------------ -------------------- ------------------ -------------------
Net income (loss) $ (1,625) $ (38,031) $ 13,541 $ (41,544)
================== ==================== ================== ===================
Earnings per common share -
basic and diluted (0.0002) (0.0037) 0.0013 (0.0041)
Weighted average common shares
outstanding - basic and dilutive 10,228,000 10,228,000 10,228,000 10,228,000
================== ==================== ================== ===================
See accountant's review report and notes to consolidated financial statements.
5
Clixtix, Inc and Subsidiary
(Formerly Phyllis Maxwell's Groups, Inc.)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Common Stock Additional Paid Retained
------------------------------
Shares Amount -In Capital Earnings Total
------ ------
------------------ --------------- ---------------
Nine months ended September 30, 2003 (unaudited):
Balances, December 31, 2002 10,228,000 $20,973 $34,058 $(28,719) $26,312
Net income, nine months - - - (1,165) (1,165)
----------------- ------------ ------------------ --------------- ---------------
Balances, September 30, 2003 10,228,000 20,973 34,058 (30,344) 24,687
================= ============ ================== =============== ===============
Nine months ended September 30, 2002 (unaudited):
Balances, December 31, 2001 10,228,000 $20,973 $ 34,058 $ 18,399 $73,430
Net income, nine months (38,031) (38,031)
----------------- ------------ ------------------ --------------- ---------------
Balances, September 30, 2002 $10,228,000 $20,973 $ 34,058 $(19,632) $ 35,399
================= ============ ================== =============== ===============
See accountant's review report and notes to consolidated financial statements.
6
Clixtix, Inc and Subsidiary
(Formerly Phyllis Maxwell's Groups, Inc.)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended Nine months ended
September 30, 2003 September 30, 2002
---------------------- ---------------------
(Unaudited) (Unaudited)
Cash flows provided by (used in):
Operating activities:
Cash received from customers $ 199,024 $ 194,358
Cash paid to suppliers and employees (199,047) (180,324)
Interest received 893 377
Income tax paid - -
---------------------- ---------------------
Net cash provided by (used in)
operating activities (7,520) 14,411
---------------------- ---------------------
Cash flows provide by (used in):
Investing activities: - -
---------------------- ---------------------
Financial activities:
Repayment of Stockholder Loan Payable - (26,500)
---------------------- ---------------------
Net cash provided by (used in)
financial activities: - (26,500)
---------------------- ---------------------
Net increase (decrease) in cash (7,520) (12,089)
Cash, beginning of period 19,365 35,990
---------------------- ---------------------
Cash, end of period $ 11,845 $ 23,901
====================== =====================
See accountants' review report and notes to consolidated financial statements.
7
Clixtix, Inc and Subsidiary
Formerly Phyllis Maxwell's Groups, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)
THREE MONTHS ENDED SEPTEMBER 30, 2003
1) In the opinion of the Company's management, the accompanying consolidated
financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position of the
Company as of September 30, 2003 and the results of operations and cash flows
for the nine month periods ended September 30, 2003 and 2002. Because of the
possible fluctuations in the marketplace and in the entertainment industry,
operating results of the Company on a nine -month basis may not be indicative
of operating results for the full year.
2) The Company is not aware of any pending or threatened legal proceedings
which could have a material adverse effect on its financial position or
results of operations.
8
Item 2. Management's Discussion and Analysis or Plan of Operation.
The following discussion of our financial condition and results of operations
should be read in conjunction with the Condensed Consolidated Financial
Statements and Notes to those financial statements included in this Quarterly
Report and our Annual Report on Form 10KSB for the year ended December 31,2002.
This discussion contains forward-looking statements that involve risks and
uncertainties. Our actual results may differ materially from those anticipated
in these forward-looking statements as a result of various factors including,
but not limited to, those discussed in this Quarterly Report.
OVERVIEW
We were incorporated under the name Phyllis Maxwell's Groups, Inc. in New York
on April 18, 1989. On August 31, 2001, we filed a Certificate of Amendment
changing our name to Clixtix, Inc.
Our wholly owned subsidiary, Maxwell Group Entertainment, Inc., was
incorporated under the laws of New York on August 3, 2001.
On August 31, 2001, we and our subsidiary entered into an Agreement and Plan of
Reorganization (the "Agreement"). Under the terms of the Agreement, we sold to
our subsidiary all of our tangible and intangible assets appearing on our
balance sheet as of September 30, 2001 and our subsidiary assumed all of the
liabilities appearing on our balance sheet as of September 30, 2001 in
consideration for 100 shares of our subsidiary's common stock,which constitutes
all of the issued and outstanding stock of our subsidiary.
We, through our subsidiary, provide services for groups who are interested in
attending New York's Broadway and Off-Broadway productions. We are licensed by
the City of New York to resell tickets to Broadway and Off-Broadway theatre
performances. Typically, we buy group tickets on behalf of a customer group
(usually a minimum of 20 persons) and our fee is paid, with limited exceptions
by the theatre. These exceptions include Saturday night tickets,certain holiday
periods or if the group falls below 20 persons,in which case the fee is paid by
the customer. On occasion, as a special service for group customers, for an
additional fee, as few as two or four tickets may be purchased.
Revenue is not recognized by us until the date an invoice is generated.
Generally, our sales and billing processes are as follows:
A customer will contact us regarding the availability of theatre tickets. We
will then contact the box office by phone regarding the customer's inquiry. If
the ticket availability is satisfactory to the customer, we will send a written
confirmation to the theatre detailing the show date and number of tickets
needed. Once we receive the signed confirmation back from the theatre, we send
the customer an invoice that details the price of the tickets. The price is
fixed and determinable.Upon our receipt from the customer of the non-refundable
9
amount due per the invoice, we will immediately remit the funds to the
respective show's box office. At that time,we have completed our work necessary
to earn our fee from the theatre. After the funds are received by the box
office, it sends the tickets to the customer. Our fee is delivered to us by the
theatres after the date of the show's performance. Our fee is 9.45% of the
ticket price. Box offices tend not to pay commission or give discounted ticket
prices for holiday and weekend performances. If customers wish to purchase
tickets for these periods, we may charge a commission that is, in that case,
included in the invoice amount. As such, in those instances, we receive our
commission before the date of the performance.
During the quarter ended September 30, 2003, we did not sustain any losses due
to cancellation of performances. The closing of any one show will not have a
material effect on our revenue stream, since each fee is based on a specific
date of performance. When productions close after a long theatre run, they tend
to announce the closing dates well in advance of the last performance.
We have been in operation since April 1988. Prior to 1989,Mrs. Maxwell operated
the same business as a sole proprietorship. During 2001,we conducted an initial
public offering in which we offered and sold 1,000,000 shares of our common
stock at a price of $0.05 per share for total consideration of $50,000. Our
proceeds from the sale of the shares were $50,000. Such proceeds were to be
utilized to substantially expand our website, implement new marketing programs,
and for the general expansion of our business through the greater use of the
internet as described below.
Based on the events of September 11, 2001, New York City and specifically, on
the theater industry, sustain a negative financial impact. As both New York
City and specifically, the theater industry, recovers we will continue to focus
our efforts on our core business practice.
Pursuant to an Asset Purchase Agreement dated as of September 23, 2003
(the "Asset Purchase Agreement") by and among Clixtix, Inc, Vic Cantor Theatre
Party Services, Inc., a New York corporation and Harold Fishkin, the sole
shareholder of VCT, Clixtix acquired certain of the assets of VCT in
consideration of the payment of an aggregate purchase price of $164,000. The
Purchase Price was paid (a) $54,000 by certified check and (b) the balance by
delivery of a three year promissory note payable in equal monthly installments
commencing on December 23, 2003. Based upon certain threshold ticket sales
being achieved over the next 12 months, VCT has the ability to "earn" and
additional $36,000, which if paid would increase the aggregate Purchase Price
to $200,000.
VCT has been engaged in the business of group and individual ticket sales for
theatrical and other events in the New York City area. In accordance with the
terms of the Asset Purchase Agreement, each of VCT and Harold Fishkin has
agreed not to compete with Clixtix for a period of five years.
We are currently on five web sites(two of our own and three others where we are
listed as a source for group Broadway ticket sales) and numerous search engines
in the category of Broadway shows/Theatre Group
10
Sales Agency Entertainment. It is our intention to continue to be listed on
every possible search engine.
FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
RESULTS OF OPERATIONS
For the quarter ended September 30, 2003, we had a net income of $13,541
compared to a net loss of ($41,544) for the quarter end September 30, 2002. For
the nine months ended September 30, 2003,we had a net loss of ($1,625) compared
to a net loss of ($21,031) for the nine months ended September 30, 2002. Our
decrease in net loss and resulting losses can be attributed to the fact that
our commission revenues increased 247% from $33,104 for the quarter ended
September 30, 2002 to $81,659 for the quarter ended September 30, 2003. Our
commission revenues decreased by 18% from $191,816 for the nine months ended
September 30, 3002 to $162,421 for the nine months ended September 30, 2003.
A significant factor can be partly attributed to a rise in NYC's overall
business activity, the first rise since February 2002, after a significant
economic recession experienced in the New York City tourism and travel industry
surrounding the events September 11th.The impact continued as a result of
travel alerts during Spring 2002 for New York City limited and lowered the
ongoing bookings of groups and customers through Spring of 2003. A reversal
of the effects combined with additional revenues as a result of the purchase
of the business assets from the Vic Cantor Theatre Party Services, Inc.
including its client base and commission receivables.
Customers frequently reserve tickets nine to nine months in advance without the
right to cancel, but our commissions are not received until after a specific
performance date occurs. In addition, our increase of commissions was due to
several new shows. Customer demand is a factor beyond our control, which varies
from quarter to quarter dependent upon availability of new shows. A majority of
our customers are repeat customers seeking only new shows. The increase of new
shows provided an increase in overall commissions.
Another significant factor affecting our level of commission revenues is the
availability of tickets for the shows in high demand. Customer demand is a
factor beyond our control, which varies from quarter to quarter. If our
customers are seeking to see shows for which there are few tickets available
(i.e. The Producers, Hairspray), we may have difficulty in obtaining such
tickets which would cause our commission revenues to decrease. In addition, the
age of the highly demanded shows also affects our ability to obtain tickets
and, in turn, our commission revenues. The longer a popular production has been
running, the less difficulty we face in obtaining and selling tickets.
Despite our increase in commission revenues, our general and administrative
expenses also decreased 25% from $ 74,759 for the quarter ended September 30,
2002 to $ 69,014 for the quarter ended September 30, 2003. Our general and
administrative expenses decreased 25% from $ 219,224 for the nine months ended
September 30, 2002 to $165,019 for the nine months ended September 30, 2003.
11
Our general and administrative expenses include, but are not limited to,
salaries, employee benefit programs, professional fees, travel and
entertainment, telephone, office rent and offices expenses.
Our decrease in general and administrative expenses for the quarter and nine
months ended September 30, 2003 can be largely attributed to our decrease in
professional fees. Our professional fees decreased 76% from $39,933 for nine
months ended September 30, 2002 to $9,340 for nine months ended September 30,
2003. The decrease in our professional expenses, comprised of our legal and
accounting fees, was from a non-reoccurring expense incurred during the
period ended September 30, 2002 when we filed a registration statement on Form
SB-2. A reduction of 62% in miscellaneous expenses occurred related to
reduction of commissions from $14,557 for nine months ended September 30, 2002
to $5,570 for nine months ended September 30, 2003.
Our offices expenses for the quarter and nine months ended September 30, 2003
increased 13% from $12,873 for nine months ended September 30, 2002 to $14,607
for nine months ended September 30, 2003. Our salaries and payroll expenses for
the quarter and nine months ended September 30,2003 decreased 15% from $107,391
for nine months ended September 30, 2002 to $91,600 for nine months ended
September 30, 2003. Our rent expenses for the quarter and nine months ended
September 30, 2003 increased 24.5% from 12,997 for nine months ended September
30, 2002 to $16,180 for nine months ended September 30, 2003. Our postage
expenses for the quarter and nine months ended September 30,2003 also increased
64% from $1645 for nine months ended September 30, 2002 to $2,696 for nine
months ended September 30, 2003. Our travel and entertainment expenses for the
quarter and nine months ended September 30, 2003 decreased 13% from $10,132 for
nine months ended September 30, 2002 to $8,857 for nine months ended September
30, 2003.
Our income tax expense for the quarter and nine months ended September 30, 2003
of $0 as compared to income taxes of $17,000 for the nine months ended
September 30, 2002. The decrease of incomes taxes is result of the current
operating losses. Our income taxes are calculated based on the prescribed
statutory rates based on our income before taxes for the specific period.
LIQUIDITY AND CAPITAL RESOURCES
We ended the nine month period ended September 30, 2003 with a cash position of
$11,845 for the nine months ending September 30, 2003 as compared to a cash
position of $23,901 for the nine months ending September 30, 2002.The fact that
our cash position declined it can be attributed to the fact that during the
ninemonths ended September 30, 2003 the amount of cash received from
customers decreased by $3,724, or 2%, from $194,358 for the nine months ended
September 30, 2002 to $190,634 for the nine month period ended September
30, 2003. A portion of this $12,056 decrease in our cash position was
attributed to $18,723, or 10%, increase in cash paid to suppliers and
employees from $180,324 in the nine months ended September 30, 2002 as
compared to $199,047 the nine monthsended September 30, 2003. A
significant portion of this decrease in our cash position was attributed to
$10,000 paid in the acquisition of the business of Vic Cantor Theatre
Party Services, Inc.and a $42,071,or 42% decrease in Accounts Payable from
12
$99,951 for the nine months ended September 30, 2002 to $57,880 for
the nine month period ended September 30, 2003. Our decreased cash position
is also slightly offset by a 237% increase, or $516.00 in our in
interest received for nine months ended September 30, 2003 as compared to
nine months ended September 30, 2002.
In the acquisition of the business of Vic Cantor Theatre Party Services, Inc.,
the purchase provided the seller receive $54,000 of which $10,000 was paid from
our cash position and $44,000 was paid from the proceeds from an officer loan
increase by $44,000 for the nine months ended September 30, 2003. In addition,
the acquisition required the payment of a long-term non-negotiable note in the
amount of $110,000 over three (3) years. The current portion of the long-term
debt is $36,667 for nine months ended September 30, 2003 and the remaining
amount increased the long-term liabilities and loan payable VC to $73,333 for
the nine months ended September 30, 2003.
In the acquisition of the business of Vic Cantor Theatre Party Services, Inc.,
we acquired both commission receivables and commission payables. Our commission
receivable position increased $27,664 for the nine months ending September 30,
2003. The increase is offset by a $22,879 increase in commission receivables
from $71,203 for the nine months ended September 30, 2002 to $94,082.
The recovery of the theatrical industry after the effects of September 11, 2001
reflected in the increased revenues during the three months ended September 30,
2003, a recovery that continues into the Fall 2003, and the increase business
derived from the acquisition of Vic Cantor Theatre Party Services, Inc., and
advance bookings will be sufficient to satisfy our current requirements through
the year ending December 31, 2003.
However, we may require significant additional financial resources for any
future expansion, especially if the expansion is affected through the
acquisition of related businesses. It is not possible to quantify what amount
may actually be required. Although the demand for our services seems to have
stabilized, there is no assurance that this level of business will continue or
significantly increase throughout 2003. If needed, we may seek to obtain
additional financing through public or private equity offerings. If we are
unable to generate the required amount of additional capital, our ability to
implement our expansion strategies may be adversely affected. No specific plans
exist for financing at this time.
VARIABLES AND TRENDS
Due to the possible fluctuations in the marketplace and the entertainment
industry, our operating results on a nine month basis may not be indicative of
our operating results for a full year.
We have been conducting the same type of business activities for approximately
13 years. Key variables in our industry are caused by the lack of popularity or
attraction of certain productions. However, prior to September 11, 2001, the
demand to see Broadway and Off-Broadway productions had been constant.
Successful shows had been enjoying a longer run time (i.e. Cats ran for 18
years and Miss Saigon ran for 9
13
years, Les Miserables ran for 16 years) and more people had been going to see
theatre.
In addition, there is a current trend of large, well financed companies such as
Disney, Clear Channel,Fox Theatricals and Endemol/Dodger Theatricals furnishing
productions backed by substantial promotion dollars. In fact, Disney is
currently presenting three productions on Broadway and Clear Channel has
produced two productions with more scheduled in the coming season.
Our revenue stream is affected by the influx of tourism into New York City and
is directly dependent upon attendance levels at Broadway shows. The terrorist
attacks on the World Trade Center on September 11, 2001 and continued threats
and travel alerts had a severe impact on the economic situation in New York
City, especially with respect to tourism and theatre. After 9/11, there have
been several advertising campaigns undertaken as well as promotions at many of
the city's hotels and restaurants in an effort to encourage tourism to New York
City, which had a positive affect on single ticket sales, but larger group
ticket sales are still in recovery.Although tourism and theatre attendance have
returned to near normal levels, there is no assurance that such levels of
tourism and theatre attendance will continue. A decrease in levels of tourism
and theatre attendance may have adverse effects on our business.
The "rebirth" of the Time Square area of New York City continues to support
tourism within the Broadway theatre district and the business in theatre.
Assuming that the level of tourism and theatre attendance continue to increase,
all of these influences, changes and product development taking place including
the changes in Times Square, the participation of the business giants and the
promotion of all of live entertainment and the new theatres and restoration of
several elegant historic showplaces can only affect us positively. Lion King
(Disney) continues to play to standing room capacity for 5 years as of
November. Les Miserables closed after 16 years. The longevity of several of
the other shows (i.e. Rent, Phantom of the Opera and Chicago and newer
theatrical hits of Hairspray and Producers and others) have the potential to
make for a solid future for Broadway and Off-Broadway.
The trauma of September 11, 2001 affected the economic life of New York City in
many aspects still in recovery. The theatre industry felt an impact as many
shows closed prematurely and others played to lower capacity. Some productions
postponed or cancelled their openings until Spring 2002 and Fall 2002, cutting
down the number of new productions available for sale. This reduced number of
new shows continued into Spring 2003 as additional terrorist threats limited
both national and international limited tourism to New York City. The
theatrical industry and its recovery in New York continues and remains stable.
However, it is unclear whether a full recovery and demand will continue given
the generally unstable economic and political climate. As at September 30,
2003, we employed a total of four employees of which two are full time, one
is part time and one serves as consultant. We may hire additional employees
during the year ending December 31, 2003 as our needs and resources permit.
14
Item 3. Controls and Procedures
In order to ensure full and timely disclosure in our periodic reports,
as wells as on Form 8-K and proxy materials and information statements we have
formed a committee consisting of our president, vice president and chief
financial officer and a partner from our legal counsel.
The committee has been charged with the responsibility of establishing a
timeline and responsibility list for drafting quarterly and annual reports and
distributing reports to management, directors, legal counsel and auditors.
Responsibility will be assigned to specific members for the continual review of
the disclosure requirements for the various reports and changes to laws or
interpretations that affect our disclosures.
Since the disclosures affect both financial and non-financial information
we have instructed our legal counsel to provide us with a quarterly
update, and copies of, amendments to or the adoption of new laws and/or
regulations affecting such disclosures.
Additionally, we have asked our auditors to provide us a checklist
to be followed in connection with quarterly and annual financial reporting
obligations. We also will require all officers and directors to complete
officers and directors questionnaires with respect to each periodic report.
Responsibility will be assigned to specific members of the committee for
reviewing SEC filings by our competitors, to the extent available, and
reviewing analyst research reports or news articles about the industry to
report to the disclosure committee.
We require our principal executive and financial officers to provide the
committee with a report as to our business and operations which are under their
direct control.
In assigning responsibility for the different sections of our reports
the committee will seek to assign matters to those most qualified. For example,
legal matters will be assigned to the chief executive officer and/or legal
counsel, and financial related matters to the principal financial officer or
controller.
The committee will review and revise as necessary the description of the
risk factors affecting our business; and, will meet periodically to identify
material items and trends requiring disclosure. The committee will also
undertake to review, evaluate and revise as necessary our disclosure controls
and procedures and internal controls are required to be evaluated quarterly
(every 90 days).
The chief executive officer will be responsible for documenting the
procedures undertaken and completed with respect to each report.
15
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not a party to any pending legal proceedings nor is any
of its property subject to pending legal proceedings.
Item 2. Changes in Securities and Use of Proceeds.
Not Applicable.
Item 3. Defaults Upon Senior Securities.
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
Not Applicable.
Item 5. Other Information.
On March 27, 2002, we filed a registration statement on Form SB-2 on
behalf of Phyllis Maxwell, our President, pursuant to which she is offering to
sell up to 1,341,200 shares of our common stock which she currently owns on a
no minimum basis. Such registration statement became effective on
April 9, 2002. We will receive no proceeds from the sale of these shares.
Item 6. Exhibits and Reports on Form 8-K.
(a) Not Applicable.
(b) Form 8-K was filed by us on September 23, 2003 Pursuant to an
Asset Purchase Agreement dated as of September 23, 2003 (the "Asset
Purchase Agreement") by and among Clixtix, Inc., Vic Cantor Theatre
Party Services, Inc., a New York corporation ("VCT") and Harold
Fishkin, the sole shareholder of VCT.
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SIGNATURE PAGE
In accordance with the requirements of the Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: November 17, 2003 CLIXTIX, INC.
By: /s/ "Phyllis Maxwell"
Phyllis Maxwell, President
By: /s/ "Richard Kelley"
Richard Kelley, Vice President
(principal financial officer,
principal accounting officer)
CERTIFICATIONS
I, Phyllis Maxwell, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Clixtix, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
4.The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: a)
designed such disclosure controls and procedures to ensure that material
information relating to the registrant,including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared; b) evaluated the
effectiveness of the registrant's disclosure controls and procedures as of a
date within 90 days prior to the filing date of this quarterly report (the
"Evaluation Date"); and c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
17
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions): a) all significant deficiencies in the design or
operation of internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in internal
controls; and b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Dated: November 17, 2003
/s/ "Phyllis Maxwell"
Phyllis Maxwell, President
I, Richard Kelley, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Clixtix, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
4. The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: a)
designed such disclosure controls and procedures to ensure that material
information relating to the registrant,including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared; b) evaluated the
effectiveness of the registrant's disclosure controls and procedures as of a
date within 90 days prior to the filing date of this quarterly report (the
"Evaluation Date"); and c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions): a) all significant deficiencies in the design or
operation of internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in internal
controls; and b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Dated November 17, 2003
/s/ "Richard Kelley"
Richard Kelley, Vice President
(principal financial officer,
principal accounting officer)
18