United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended: September 30,2003
Commission file no.: 000-30807
CEO CHANNEL.COM, INC.
------------------------------------------------------------
(Name of Small Business Issuer in its Charter)
Florida 65-0904572
- ------------------------------------ -----------------------
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
11408 Orchard Park, Suite 311
Glen Allen, VA 23059
- --------------------------------------- -----------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (804) 273-6731
Securities registered under Section 12(b) of the Act:
Title of each class Name of each exchange
on which registered
None None
- ------------------------------- -----------------------------
Securities registered under Section 12(g) of the Act:
Common Stock, $0.0001 par value per share
--------------------------------------------------------
(Title of class)
Indicate by 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 [_]
As of March 30, 2005, there were 12,200,000 shares of voting stock of the
registrant issued and outstanding.
PART I
ITEM 1. FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
Balance Sheets...............................................................F-2
Statements of Operations.....................................................F-3
Statements of Stockholders' Equity...........................................F-4
Statements of Cash Flows.....................................................F-5
Notes to Financial Statements................................................F-6
F-1
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Balance Sheets
September 30, December 31,
2003 2002
--------------------- --------------------
(unaudited)
ASSETS
CURRENT ASSETS
Cash and equivalents $ 15,000 $ 15,000
Overpaid payroll taxes 0 0
--------------------- --------------------
Total current assets 15,000 15,000
--------------------- --------------------
PROPERTY AND EQUIPMENT
Equipment 0 0
Less: Accumulated depreciation 0 0
--------------------- --------------------
Net property and equipment 0 0
--------------------- --------------------
OTHER ASSETS
Deposits 0 0
--------------------- --------------------
Total other assets 0 0
--------------------- --------------------
Total Assets $ 15,000 $ 15,000
===================== ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued payroll and related liabilities $ 0 $ 0
Demand convertible note payable 16,700 15,800
--------------------- --------------------
Total current liabilities 16,700 15,800
--------------------- --------------------
STOCKHOLDERS' EQUITY
Preferred stock, no par value, authorized 10,000,000
shares, 0 issued and outstanding 0 0
Common stock, $0.0001 par value, authorized 50,000,000
shares; issued and outstanding 12,200,000 1,220 1,220
Additional paid-in capital 233,760 233,760
Deficit accumulated during the development stage (236,680) (235,780)
--------------------- --------------------
Total stockholders' equity (1,700) (800)
--------------------- --------------------
Total Liabilities and Stockholders' Equity $ 15,000 $ 15,000
===================== ====================
The accompanying notes are an integral part of the financial statements
F-2
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Statements of Operations
Period from
Three Months Nine Months February 3,1999
Ended September 30, Ended September 30, (Inception)
------------------------------- --------------------------------- through
2003 2002 2003 2002 September 30, 2003
-------------- --------------- --------------- ---------------- --------------------
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
REVENUES $ 0 $ 0 $ 0 $ 0 $ 17,000
-------------- --------------- --------------- ---------------- --------------------
OPERATING EXPENSES
Compensation:
Officers 0 0 0 10,000 115,538
Others 0 0 0 0 22,566
General and administrative 0 0 0 0 77,205
Depreciation 0 0 0 0 8,901
-------------- --------------- --------------- ---------------- --------------------
Total expenses 0 0 0 10,000 224,210
-------------- --------------- --------------- ---------------- --------------------
Income (loss) from operations 0 0 0 (10,000) (207,210)
-------------- --------------- --------------- ---------------- --------------------
OTHER INCOME (EXPENSE)
Loss on abandonment 0 0 0 0 (29,184)
Interest expense (300) (300) (900) (500) (1,700)
Interest income 0 0 0 0 1,414
-------------- --------------- --------------- ---------------- --------------------
Total other income (300) (300) (900) (500) (29,470)
-------------- --------------- --------------- ---------------- --------------------
Net income (loss) $ (300) $ (300) $ (900) $ (10,500) $ (236,680)
============== =============== =============== ================ ====================
Basic net income (loss) per weighted
average share $ (0.01) $ (0.01) $ (0.01) $ (0.01)
============== =============== =============== ================
Weighted average number of shares 12,200,000 12,200,000 12,200,000 12,200,000
============== =============== =============== ================
The accompanying notes are an integral part of the financial statements
F-3
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Statements of Stockholders' Equity
Deficit
Accumulated
Additional During the Total
Number of Common Paid-in Development Stockholders'
Shares Stock Capital Stage Equity
------------- ------------- --------------- ------------------ ---------------
BEGINNING BALANCE, February 3, 1999 (Inception) 0 $ 0 $ 0 $ 0 $ 0
Shares issued for cash 2,200,000 220 224,760 0 224,980
Net loss 0 0 0 (103,861) (103,861)
------------- ------------- --------------- ------------------ ---------------
BALANCE, December 31, 1999 2,200,000 220 224,760 (103,861) 121,119
Net loss 0 0 0 (121,027) (121,027)
------------- ------------- --------------- ------------------ ---------------
BALANCE, December 31, 2000 2,200,000 0 0 (224,888) 92
Net loss 0 0 0 (92) (92)
------------- ------------- --------------- ------------------ ---------------
BALANCE, December 31, 2001 2,200,000 220 224,760 (224,980) 0
Shares issued for services 10,000,000 1,000 9,000 0 10,000
Net loss 0 0 0 (10,800) (10,800)
------------- ------------- --------------- ------------------ ---------------
BALANCE, December 31, 2002 12,200,000 1,220 233,760 (235,780) (800)
Net loss 0 0 0 (900) (900)
------------- ------------- --------------- ------------------ ---------------
BALANCE, September 30, 2003 (unaudited) 12,200,000 $ 1,220 $ 233,760 $ (236,680) $ (1,700)
============= ============= =============== ================== ===============
The accompanying notes are an integral part of the financial statements
F-4
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Statements of Cash Flows
(unaudited)
Period from
Nine Months February 3, 1999
Ended September 30, (Inception)
------------------------------------ through
2003 2002 September 30, 2003
------------------ ----------------- -------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (900)$ (10,500)$ (236,680)
Adjustments to reconcile net loss to net cash used by operating
activities:
Depreciation 0 0 8,901
Common stock issued for services 0 10,000 10,000
Loss on abandonment 0 0 21,965
Changes in operating assets and liabilities:
(Increase) decrease in deposits 0 0 0
Increase (decrease) accrued interest 900 500 1,700
Increase (decrease) accrued payroll and related liabilities 0 0 0
------------------ ----------------- -------------------
Net cash used by operating activities 0 0 (194,114)
------------------ ----------------- -------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment 0 0 (30,866)
------------------ ----------------- -------------------
Net cash used by investing activities 0 0 (30,866)
------------------ ----------------- -------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from demand convertible note 0 15,000 15,000
Proceeds from issuance of common stock, net 0 0 224,980
------------------ ----------------- -------------------
Net cash provided by financing activities 0 15,000 239,980
------------------ ----------------- -------------------
Net increase (decrease) in cash 0 15,000 15,000
CASH, beginning of period 15,000 0 0
------------------ ----------------- -------------------
CASH, end of period $ 15,000 $ 15,000 $ 15,000
================== ================= ===================
The accompanying notes are an integral part of the financial statements
F-5
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
(Unaudited)
(1) Summary of Significant Accounting Policies
(a) The Company CEO-Channel.com, Inc. is a Florida chartered development
stage corporation which conducts business from its headquarters in West
Palm Beach, Florida. The Company was incorporated on February 3, 1999.
The Company began its business operations as a dot com at the height of the
boom. In the fourth quarter of 2000, the Company realized that it would not
be able to sustain its activities nor raise additional capital, so it
ceased operations. In the second quarter 2002, control of the Company
changed. At that time the Company received a cash investment in order to
maintain its reporting status while the Company began to seek new
opportunities. In late 2004, the Company began to actively seek potential
merger candidates.
The following summarize the more significant accounting and reporting
policies and practices of the Company:
(b) Use of estimates The financial statements have been prepared in
conformity with generally accepted accounting principles. In preparing the
financial statements, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities as
of the date of the statements of financial condition and revenues and
expenses for the year then ended. Actual results may differ significantly
from those estimates.
(c) Start-up costs Costs of start-up activities, including organization
costs, are expensed as incurred, in accordance with Statement of Position
(SOP) 98-5.
(d) Net income (loss) per share Basic loss per share is computed by
dividing the net income (loss) by the weighted average number of common
shares outstanding during the period.
(e) Stock compensation for services rendered The Company issues shares of
common stock in exchange for services rendered. The costs of the services
are valued according to generally accepted accounting principles and have
been charged to operations.
(f) Property and equipment All property and equipment are recorded at cost
and depreciated over their estimated useful lives, using the straight-line
method. Upon sale or retirement, the cost and related accumulated
depreciation are eliminated from their respective accounts, and the
resulting gain or loss is included in the results of operations. Repairs
and maintenance charges, which do not increase the useful lives of the
assets, are charged to operations as incurred.
F-6
CEO-Channel.com, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
(1) Summary of Significant Accounting Policies (continued)
(g) Interim financial information The financial statements for the nine
months ended September 30, 2003 and 2002 are unaudited and include all
adjustments which in the opinion of management are necessary for fair
presentation, and such adjustments are of a normal and recurring nature.
The results for the nine months are not indicative of a full year results.
(2) Stockholders' Equity The Company has authorized 50,000,000 shares of
$0.0001 par value common stock and 10,000,000 shares of no par value
preferred stock. Rights and privileges of the preferred stock are to be
determined by the Board of Directors prior to issuance. The Company had
12,200,000 shares of common and 0 preferred stock issued and outstanding,
respectively, at September 30, 2003 and 2002. In 1999, the Company issued
2,200,000 shares of common stock under Regulation D offerings in exchange
for $224,980 in cash. On April 23, 2002, the Company issued 10,000,000
shares of restricted common stock to its new management in exchange for
services valued at $0.001 per share, or $10,000 total.
(3) Income Taxes Deferred income taxes (benefits) are provided for certain
income and expenses which are recognized in different periods for tax and
financial reporting purposes. The Company had net operating loss carry-
forwards for income tax purposes of approximately $236,000 expiring
$104,000, $121,000, $10,800 and $900 at December 31, 2019, 2020, 2022 and
2023, respectively.
The amount recorded as deferred tax assets as of September 30, 2003 is
approximately $35,000, which represents the amount of tax benefit of the
loss carry-forward. The Company has established a valuation allowance
against this deferred tax asset, as the Company has no history of
profitable operations.
(4) Convertible debt On May 2, 2002, the Company received $15,000 in exchange
for demand convertible debt, which carries an interest rate of 8% per
annum. This debt is convertible into up to 15,000,000 shares of the
Company's common stock at the discretion of the debt-holders.
F-7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
Results of Operations
The Company had $0 revenues for the three and nine months ended September
30, 2003 and 2002, respectively.
The Company expended $0 and $0 and $0 and $10,000, for the three and nine
months ended September 30, 2003 and 2002, respectively on general and
administrative expenses.
For the three and nine months ended September 30, 2003 and 2002, the
Company accrued interest expense of $300 and $300 and $900 and $500,
respectively.
Future expenditure levels are expected to be nominal, generally for the
purpose of maintaining the Company's stockholder records and filing requirements
to comply with the Securities Exchange Act of 1934 and for initiating the
Company's current business plan, as discussed previously.
The Company does not expect to generate any meaningful revenue or incur
operating expenses for purposes other than fulfilling the obligations of a
reporting company under The Securities Exchange Act of 1934 unless and until
such time that the Company's operating subsidiary begins meaningful operations.
Liquidity and Capital Resources
At September 30, 2003 and 2002, respectively, the Company had working
capital of approximately $15,000 and $15,000.
It is the intent of management and significant stockholders to provide
sufficient working capital necessary to support and preserve the integrity of
the corporate entity. However, there is no legal obligation for either
management or significant stockholders to provide additional future funding.
Should this pledge fail to provide financing, the Company has not identified any
alternative sources. Consequently, there is substantial doubt about the
Company's ability to continue as a going concern.
The Company's need for capital may change dramatically as a result of the
implementation of its current business plan.
Regardless of whether the Company's cash assets prove to be inadequate to
meet the Company's operational needs, the Company might seek to compensate
providers of services by issuances of stock in lieu of cash.
Net Operating Losses
The Company has net operating loss carry-forwards of $237,000, expiring
beginning December 31, 2009. Until the Company's current operations begin to
produce earnings, it is unclear whether the Company can utilize such
carry-forwards.
Plan of Operation
If the Company is unable to generate sufficient revenue from operations to
implement its expansion plans, management intends to explore all available
alternatives for debt and/or equity financing, including but not limited to
private and public securities offerings.
Forward-Looking Statements
This Form 10-QSB includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements, other than
statements of historical facts, included or incorporated by reference in this
Form 10-QSB which address activities, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof), finding
suitable merger or acquisition candidates, expansion and growth of the Company's
business and operations, and other such matters are forward-looking statements.
These statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
or developments will conform with the Company's expectations and predictions is
subject to a number of risks and uncertainties, general economic market and
business conditions; the business opportunities (or lack thereof) that may be
presented to and pursued by the Company; changes in laws or regulation; and
other factors, most of which are beyond the control of the Company.
Consequently, all of the forward-looking statements made in this Form 10-QSB are
qualified by these cautionary statements and there can be no assurance that the
actual results or developments anticipated by the Company will be realized or,
even if substantially realized, that they will have the expected consequence to
or effects on the Company or its business or operations. The Company assumes no
obligations to update any such forward-looking statements.
ITEM 3. CONTROLS AND PROCEDURES
As required by Rule 13a-15 under the Exchange Act, within the 90 days prior
to the filing date of this report, the Company carried out an evaluation of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures. This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's
President, Chief Executive Officer and Chief Financial Officer. Based upon that
evaluation, the Company's President, Chief Executive Officer and Chief Financial
Officer concluded that the Company's disclosure controls and procedures are
effective. There have been no significant
changes in the Company's internal controls or in other factors, which could
significantly affect internal controls subsequent to the date the Company
carried out its evaluation.
Disclosure controls and procedures are controls and other procedures that
are designed to ensure that information required to be disclosed in Company
reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the Securities and
Exchange Commission's rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed in Company reports filed under the Exchange
Act is accumulated and communicated to management, including the Company's Chief
Executive Officer and Chief Financial Officer as appropriate, to allow timely
decisions regarding required disclosure.
PART II
ITEM 1. LEGAL PROCEEDINGS.
The Company knows of no legal proceedings to which it is a party or to
which any of its property is the subject which are pending, threatened or
contemplated or any unsatisfied judgments against the Company.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS IN SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted during the quarter ending September 30, 2003,
covered by this report to a vote of the Company's shareholders, through the
solicitation of proxies or otherwise.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The exhibits required to be filed herewith by Item 601 of Regulation
S-B, as described in the following index of exhibits, are incorporated herein by
reference, as follows:
Exhibit No. Description
- ----------------------------------------------------------------------
31.1 * Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002.
32.1 * Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
* Filed herewith
SIGNATURES
In accord with Section 13 or 15(d) of the Securities Act of 1933, as
amended, the Company caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.
CEO Channel.com, Inc.
Dated: April 1, 2005
By: /s/ Larry Creeger
---------------------------
Larry Creeger
Chief Executive Officer,
Chief Financial Officer