FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES ACT
OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003.
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO ________.
COMMISSION FILE NUMBER 333-61610
DATE OF REPORT: AUGUST 8, 2003
WIZBANG TECHNOLOGIES INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
WASHINGTON 912061053
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
SUITE 679, 185 - 911 YATES STREET
VICTORIA, BRITISH COLUMBIA V8V 4Y9, CANADA
(250) 519-0553
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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
The number of outstanding shares of the issuer's common stock, $0.0001 par
value, as of June 30, 2003 was 10,100,000.
TABLE OF CONTENTS
PART I
Item 1. Financial Statements 1
Item 2. Management Discussion And Analysis of
Financial Condition and Results of Operations 8
Item 3. Controls And Procedures 12
PART II
Item 5. Changes in Securities and Use of Proceeds 13
Item 6 Exhibits and Reports on Form 8-K 14
Signatures 14
Certification Of Chief Executive Officer And Principal Financial Officer
pursuant To Section 302 Of The Sarbanes-Oxley Act Of 2002 15
Index To Exhibits 17
[This Space Has Been Intentionally Left Blank]
PART I
ITEM 1. FINANCIAL STATEMENTS
Unaudited Balance Sheet At June 30, 2003 And
Audited Balance Sheet at March 31, 2003 1
Unaudited Statements Of Operations For The
Three Months Ended June 30, 2003 And 2002, 2
Unaudited Statements Of Cash Flows For The
Three Months Ended June 30, 2003 And 2002 3
Notes To Unaudited Financial Statements 4
[This Space Has Been Intentionally Left Blank]
Wizbang Technologies Inc.
Balance Sheets
(Expressed in U. S. Dollars)
June 30, March 31,
2003 2003
$ $
(unaudited) (audited)
ASSETS
Current Assets
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,628 9,996
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . 155 305
- ------------------------------------------------------------------------------------
Total Current Assets. . . . . . . . . . . . . . . . . . . . . 9,783 10,301
- ------------------------------------------------------------------------------------
Product License (Note 3)
Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,000 66,000
Accumulated Amortization . . . . . . . . . . . . . . . . . . (36,357) (30,815)
- ------------------------------------------------------------------------------------
Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,643 35,185
- ------------------------------------------------------------------------------------
Total Assets. . . . . . . . . . . . . . . . . . . . . . . . . 39,426 45,486
====================================================================================
LIABILITIES
Current Liabilities
Accounts Payable . . . . . . . . . . . . . . . . . . . . . . 999 -
Accrued Liabilities. . . . . . . . . . . . . . . . . . . . . 5,220 4,154
Notes Payable (Note 3) . . . . . . . . . . . . . . . . . . . 20,974 20,974
- ------------------------------------------------------------------------------------
Total Liabilities . . . . . . . . . . . . . . . . . . . . . . 27,193 25,128
- ------------------------------------------------------------------------------------
Contingencies (Note 1)
STOCKHOLDERS' EQUITY
Stockholders Equity
Preferred stock: 20,000,000 preferred shares authorized with
par value $. 0001; none issued. . . . . . . . . . . . . . . . - -
Common stock: 100,000,000 common shares authorized with
par value $. 0001; 10,100,000 issued and outstanding. . . . . 1,010 1,010
Additional paid in capital. . . . . . . . . . . . . . . . . . 74,990 74,990
Donated capital (Note 4(a)) . . . . . . . . . . . . . . . . . 37,500 33,750
- ------------------------------------------------------------------------------------
113,500 109,750
- ------------------------------------------------------------------------------------
Deficit . . . . . . . . . . . . . . . . . . . . . . . . . . . (101,267) (89,392)
- ------------------------------------------------------------------------------------
Total Stockholders' Equity. . . . . . . . . . . . . . . . . . 12,233 20,358
- ------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity. . . . . . . . . . 39,426 45,486
====================================================================================
(The Accompanying Notes are an Integral Part of these Interim Financial
Statements)
F-1
Wizbang Technologies Inc.
Statement Of Operations
(Expressed in U. S. Dollars)
(unaudited)
Three Months Ended
June 30,
2003 2002
--------------------
$ $
Sales. . . . . . . . . . . . . . . . - -
Cost of goods sold . . . . . . . . . - -
- -----------------------------------------------------------------------
Gross Margin . . . . . . . . . . . . - -
- -----------------------------------------------------------------------
Operating Expenses
Amortization. . . . . . . . . . . . 5,542 2,875
Bank charges and Interest . . . . . 410 303
Communication . . . . . . . . . . . 150 1,133
Consulting (Note 4(a)). . . . . . . 3,000 3,000
Professional Fees . . . . . . . . . 2,023 550
Rent (Note 4(a)). . . . . . . . . . 750 750
- -----------------------------------------------------------------------
Total Operating Expenses . . . . . . 11,875 8,611
- -----------------------------------------------------------------------
Net Loss for the Period. . . . . . . (11,875) (8,611)
=======================================================================
Net Loss Per Share - Basic . . . . . (0. 001) (0. 001)
=======================================================================
Weighted Average Shares Outstanding. 10,100,000 10,100,000
=======================================================================
(The Accompanying Notes are an Integral Part of these Interim Financial
Statements)
F-2
Wizbang Technologies Inc.
Statement Of Cash Flows
(Expressed in U. S. Dollars)
(unaudited)
Three Months Ended
June 30,
2003 2002
--------------------
$ $
Cash Flows From Operating Activities
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,875) (8,611)
Adjustments to reconcile net loss to net cash used by operating activities:
Amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,542 2,875
Donated consulting services. . . . . . . . . . . . . . . . . . . . . . . . . 3,000 -
Donated rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 750 -
Changes in operating assets and liabilities
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 -
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 999 -
Accrued liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,066 4,148
- -----------------------------------------------------------------------------------------------------------
Net Cash (Used In) Operating Activities. . . . . . . . . . . . . . . . . . . (368) (1,588)
- -----------------------------------------------------------------------------------------------------------
Decrease in cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (368) (1,588)
Cash, beginning of period. . . . . . . . . . . . . . . . . . . . . . . . . . 9,996 36,148
- -----------------------------------------------------------------------------------------------------------
Cash, end of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,628 34,560
===========================================================================================================
Non-Cash Financing Activities
Notes payable issued to purchase license (Notes 3) . . . . . . . . . . . . . - 30,000
===========================================================================================================
Supplemental Disclosures
Interest paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - -
Income taxes paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - -
===========================================================================================================
(The Accompanying Notes are an Integral Part of these Interim Financial
Statements)
F-3
Wizbang Technologies Inc.
Notes To Financial Statements
(Expressed in US Dollars)
(Unaudited)
_____________________________________________________________________
1. Company Background
The Company was incorporated in the State of Washington on September 22, 2000.
On this date the Company entered into a licensing agreement with Reach
Technologies, Inc., a Canadian Corporation. The license agreement allows the
Company to sell a Digital Data Recorder product line worldwide. The Company's
principal business plan is to seek immediate earnings by exploiting the license
agreement with Reach Technologies, Inc.
The Company emerged from being a development stage company during the fiscal
year ended March 31, 2003. In a development stage company, management devoted
most of its activities to establishing the business. Planned principal
activities have generated significant revenue however, the Company has a deficit
of $101,267 at June 30, 2003 and a working capital deficiency at June 30, 2003
of $17,410. The Company plans to generate sufficient cash flow from sales to
meet its long-term requirements. Although existing cash and cash flow from sales
is expected to fulfill future capital needs, if sales in the long term are
insufficient, the Company may need additional capital to carry out its business
plan. In the event that the Company requires more capital, no commitments to
provide additional funds have been made by management or other shareholders.
Accordingly, there can be no assurance that any additional funds will be
available on terms acceptable to the Company or at all. There is substantial
doubt regarding the Company's ability to continue as a going concern.
2. Summary of Significant Accounting Principles
a) Year End
The Company's fiscal year end is March 31.
b) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of three
months or less at the time of issuance to be cash equivalents.
c) Intangible Assets
Intangible assets consist of product license, which is amortized on a
straight-line basis over four years. The carrying value of the License is
evaluated in each reporting period to determine if there were events or
circumstances which would indicate a possible inability to recover the carrying
amount. Such evaluation is based on various analyses including assessing the
Company's ability to bring the commercial applications to market, related
profitability projections and undiscounted cash flows relating to each
application. Where an impairment loss has been determined the carrying amount is
written-down to fair market value.
d) Use of Estimates
The preparation of financial statements in conformity with U. S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Areas where significant estimates have been applied include
the value of donated services and recoverability of license costs. Actual
results could differ from those estimates.
4
Wizbang Technologies Inc.
Notes To Financial Statements
(Expressed in US Dollars)
(Unaudited)
_____________________________________________________________________
2. Summary of Significant Accounting Principles (continued)
e) Interim Financial Statements
These interim unaudited financial statements have been prepared on the same
basis as the annual financial statements and in the opinion of management,
reflect all adjustments, which include only normal recurring adjustments,
necessary to present fairly the Company's financial position, results of
operations and cash flows for the periods shown. The results of operations for
such periods are not necessarily indicative of the results expected for a full
year or for any future period.
f) Basic and Diluted Net Income (Loss) Per Share
The Company computes net income (loss) per share in accordance with SFAS No.
128, "Earnings per Share" (SFAS 128). SFAS 128 requires presentation of both
basic and diluted earnings per share (EPS) on the face of the income statement.
Basic EPS is computed by dividing net income (loss) available to common
shareholders (numerator) by the weighted average number of shares outstanding
(denominator) during the period. Diluted EPS gives effect to all dilutive
potential common shares outstanding during the period including stock options,
using the treasury stock method, and convertible preferred stock, using the
if-converted method. In computing Diluted EPS, the average stock price for the
period is used in determining the number of shares assumed to be purchased from
the exercise of stock options or warrants. Diluted EPS excludes all dilutive
potential shares if their effect is anti dilutive.
g) Revenue Recognition
The Company recognizes revenue from sales of Digital Data Recorders when goods
have been shipped and title has passed to the customer. The Company recognizes
revenue in accordance with Securities and Exchange Commission Staff Accounting
Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements. "
Revenue is recognized only when the price is fixed or determinable, persuasive
evidence of an arrangement exists, the service is performed, and collectibility
is reasonably assured.
The Company follows the guidance pursuant to Emerging Issues Task Force (EITF)
No. 99-19, "Reporting Revenue Gross as a Principal versus Net as an Agent. "The
Company records revenue on a gross basis representing the amount that has been
billed to a customer. The Company has the risks and rewards of ownership
including the risk of loss for collection, delivery and returns. Also the
Company has latitude in establishing product pricing above a specific minimum
price and also has bears all credit risk in the event collection is not made
from a customer.
h) Comprehensive Loss
SFAS No. 130, "Reporting Comprehensive Income," establishes standards for the
reporting and display of comprehensive loss and its components in the financial
statements. As at June 30, 2003 and 2002, the Company has no items that
represent comprehensive loss and, therefore, has not included a schedule of
comprehensive loss in the financial statements.
i) Financial Instruments
The fair values of cash and equivalents, accrued liabilities and note payable
were estimated to approximate their carrying values due to the immediate or
short-term maturity of these financial instruments.
5
Wizbang Technologies Inc.
Notes To Financial Statements
(Expressed in US Dollars)
(Unaudited)
_____________________________________________________________________
2. Summary of Significant Accounting Principles (continued)
j) Impact of Accounting Standards
In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. It
requires that an issuer classify a financial instrument that is within its scope
as a liability (or an asset in some circumstances). The requirements of SFAS No.
150 apply to issuers' classification and measurement of freestanding financial
instruments, including those that comprise more than one option or forward
contract. SFAS No. 150 does not apply to features that are embedded in a
financial instrument that is not a derivative in its entirety. SFAS No. 150 is
effective for financial instruments entered into or modified after May 31, 2003,
and otherwise is effective at the beginning of the first interim period
beginning after June 15, 2003, except for mandatory redeemable financial
instruments of nonpublic entities. It is to be implemented by reporting the
cumulative effect of a change in an accounting principle for financial
instruments created before the issuance date of SFAS No. 150 and still existing
at the beginning of the interim period of adoption. Restatement is not
permitted. The adoption of this standard is not expected to have a material
effect on the Company's results of operations or financial position.
In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure", which amends SFAS No. 123 to provide
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based employee compensation. In addition, SFAS
No. 148 expands the disclosure requirements of SFAS No. 123 to require more
prominent disclosures in both annual and interim financial statements about the
method of accounting for stock-based employee compensation and the effect of the
method used on reported results. The transition provisions of SFAS No. 148 are
effective for fiscal years ended after December 15, 2002. The disclosure
provisions of SFAS No. 148 are effective for financial statements for interim
periods beginning after December 15, 2002. The transition provisions do not
currently have an impact on the Company's financial position and results of
operations as the Company currently has no stock-based employee compensation.
In June, 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities". The provisions of this Statement are effective for
exit or disposal activities that are initiated after December 31, 2002, with
early application encouraged. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring)". This Statement requires
that a liability for a cost associated with an exit or disposal activity be
recognized when the liability is incurred. The Company will adopt SFAS No. 146
on January 1, 2003. The effect of adoption of this standard on the Company's
results of operations and financial position is not expected to be material.
FASB has also issued SFAS No. 145, 147 and 149 but they will not have any
relationship to the operations of the Company therefore a description of each
and their respective impact on the Company's operations have not been disclosed.
6
Wizbang Technologies Inc.
Notes To Financial Statements
(Expressed in US Dollars)
(Unaudited)
_____________________________________________________________________
Product License
The Company acquired the right to market and sell a Digital Data Recorder
product line (the "License") in the states of North Dakota, South Dakota,
Nebraska, Kansas, Montana, Wyoming, and Colorado. The licensed product consists
of 0 to 40 Megabit per second Bit Error Rate Testers that are configured for
laboratory and onsite use. Models consist of laboratory, rack mount and portable
versions. The licensor maintains the right to set the minimum price of the
licensed products. The license was acquired on September 22, 2000 and has a
four-year term. The license was purchased by the Company for $16,000 cash from
Reach, which is one-third owned by the President of the Company and two-thirds
owned by arms-length parties. Reach manufactures all of the products that the
Company sells. Under the terms of the License agreement, the Company purchases
products from Reach and resells them.
On October 31, 2001 the Company agreed to pay $20,000 in the form of a note
payable, due October 31, 2003, to amend the License agreement to a worldwide
exclusive license, except in the territories of Washington DC, Virginia, West
Virginia, Maryland, Pennsylvania, New York, Connecticut, Massachusetts, New
Hampshire, Maine, Ohio, Kentucky and Tennessee where the license will be
non-exclusive. The Company has repaid the note payable in full.
On June 10, 2002 the Company agreed to pay $30,000 in the form of a note
payable, due June 30, 2004, to amend the License agreement to include a
worldwide exclusive license for data recorders in the 41 to 160 mega bit per
second range. Interest accrues on the unpaid principal amount of $20,974 at a
rate of 7% per annum and matures June 30, 2004 and is due on demand in the event
of termination for cause, which includes breach of the agreement; the bankruptcy
or insolvency of Wizbang Technologies Inc. ; or the conviction of Wizbang
Technologies Inc., its officers or directors, of any crime involving moral
turpitude. As at June 30, 2003, included in accrued liabilities is an interest
accrual of $2,143.
The amortization of the license for the remainder of the license agreement is as
follows:
$
2004 24,500
2005 11,857
------
36,357
======
4. Related Party Transactions/Balances
a) A Company controlled by the President of the Company donated services
valued at $3,000 (2002 - $3,000) and rent valued at $750 (2002 - $750). These
amounts were charged to operations and classified as "donated capital" in
stockholders' equity.
b) The Company's President and controlling shareholder is also a one half
shareholder (2002: one third shareholder) in Reach Technologies, Inc. ("Reach").
The other shareholders of Reach are not related to the Company. Under the terms
of the license agreement with Reach, which was negotiated at arms length, the
Company acquires products from Reach for sale to unrelated third parties. The
Company made no purchases from Reach during the three month periods ended June
30, 2003 and 2002.
5. Subsequent Event
On July 31, 2003 the Company acquired an option to purchase the Dalhousie
Mineral Claim, situated in the Stewart Area, Skeena Mining Division in the
Province of British Columbia, Canada. The purchase price was $10,000 payable to
the vendor within ninety days of the date of the Sale Agreement ("the
Agreement"). The Company, pursuant to the Agreement, is required to split the
common shares on a two for one basis and cancel an appropriate number of shares
held by the Company's President to leave 10,100,000 post split shares issued and
outstanding prior to any share issuances to the vendor. Pursuant to the
Agreement the Company is required to issue 100,000 post split shares within
ninety days of the date of the Agreement and a further 100,000 post split shares
on the beginning of any exploration program which the Company carries out on the
Dalhousie Claim. Also, pursuant to the Agreement, the Company is to issue
300,000 post split common shares to the vendor, upon the Dalhousie Claim being
put into commercial production.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This quarterly report on Form 10-QSB contains forward-looking statements, which
are made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially from the
forward-looking statements. You should not place undue reliance on
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expects", "plans",
"anticipates", "believes", "estimated", "predicts", "potential", or "continue"
or the negative of such terms or other comparable terminology. These statements
are only predictions and involve known and unknown risks, uncertainties, and
other factors that may cause Wizbang Technologies Inc.'s actual results, levels
of activity, performance, or achievements to be materially different from any
future results, levels of activity, performance, or achievements expressed or
implied by such forward-looking statements. These factors include, among other
things, those discussed in this quarterly report on Form 10-QSB and in Wizbang
Technologies Inc.'s other filings with the SEC. Although Wizbang Technologies
Inc. believes that the expectations reflected in the forward-looking statements
are reasonable, forward-looking statements are inherently uncertain, and Wizbang
Technologies Inc. cannot guarantee future results, levels of activity,
performance, or achievements. Wizbang Technologies Inc. is under no duty to
update any of the forward-looking statements in this quarterly report on Form
10-QSB to conform forward-looking statements to actual results. All
forward-looking statements should be considered in light of these risks and
uncertainties.
APPLICATION OF CRITICAL ACCOUNTING POLICIES
- -----------------------------------------------
Wizbang Technologies Inc.'s financial statements are prepared in accordance with
accounting principles generally accepted in the United States. Preparing
financial statements in accordance with generally accepted accounting principles
requires management to make estimates and assumptions which affect the reported
amounts of assets and liabilities and the disclosure of contingent assets and
liabilities at the balance sheet dates, and the recognition of revenues and
expenses for the reporting periods. These estimates and assumptions are affected
by management's application of accounting policies.
Product License
The amortization period of the license agreement coincides with the term of the
license and its recoverability is reviewed quarterly.
Donated Services
Wizbang Technologies Inc.'s president does currently draw a salary. Donated
services are an estimate of the value of services that the president provides.
DESCRIPTION OF BUSINESS
- -------------------------
Wizbang Technologies Inc. was incorporated under the laws of the State of
Washington on September 22, 2000. Wizbang Technologies Inc. principal business,
at present, is the marketing of its licensed product line consisting of
high-tech instruments that are used to record information transferred from
distant sources like aircraft and satellites. Simply put the recorders are high
speed tape recorders that are capable of recording information relayed by
several types of satellites and aircraft. Some of the data that can be recorded
include fuel consumption, engine rotation per minute, time, pictures recorded by
cameras, load stresses recorded by sensors and the status of various equipment
on the craft such as batteries or radar. The recorder operates basically the
same as a VCR with all the same play, fast-forward, rewind, record, scheduled
operation, and other similar functions. The product line is unique in that it
can record information from satellites at speeds required by those satellites.
The licensed product line consists of recorders capable of recording at speeds
up to 160 Megabits per second. The recorders are configured for both laboratory
and onsite use. Models consist of laboratory, rack mount and portable versions.
RESULTS OF OPERATIONS
- -----------------------
At June 30, 2003, Wizbang Technologies Inc. had $9,783 in current assets and
$27,193 in current liabilities. Wizbang Technologies Inc. intends to pay the
current liabilities out of cash on hand, sales from its product license line or
through a share offering. Cash decreased by $368 during the period for a
balance of $9,628 at quarter-end.
8
Wizbang Technologies Inc. paid no notes payable resulting in the $20,974 owing
at period-end. After recording amortization of $5,542 during the period, the net
license value is $29,643. Wizbang Technologies Inc. increased the scope of its
product offering in the expectation of generating future sales from those new
products.
Revenues were $Nil for the period compared with $Nil for the same period last
year. Wizbang Technologies Inc.'s future plans include continuing to market the
licensed product line. The market for the product includes aircraft and
spacecraft manufacturers, both private and government, involved in both military
and nonmilitary applications and it is anticipated that these will be the focus
of selling efforts. Wizbang Technologies Inc. will begin marketing the product
to new target companies as they are identified. I addition Wizbang Technologies
has begun to look for ways to diversify its business and as such after the
period of this report it acquired an option to purchase the Dalhousie Mineral
Claim, situated in the Stewart Area, Skeena Mining Division in the Province of
British Columbia, Canada. The purchase price was $10,000 payable to the vendor
within ninety days of the date of the Sale Agreement ("the Agreement"). The
Company, pursuant to the Agreement, is required to split the common shares on a
two for one basis and cancel an appropriate number of shares held by the
Company's President to leave 10,100,000 post split shares issued and outstanding
prior to any share issuances to the vendor. Pursuant to the Agreement the
Company is required to issue 100,000 post split shares within ninety days of the
date of the Agreement and a further 100,000 post split shares on the beginning
of any exploration program which the Company carries out on the Dalhousie Claim.
Also, pursuant to the Agreement, the Company is to issue 300,000 post split
common shares to the vendor, upon the Dalhousie Claim being put into commercial
production.
Total expenses increased $3,264, over the comparable period in the previous
year, to $11,875. This net increase was due mostly to:
1. an increase in amortization expense of $2,667, resulting from the increased
license cost, discussed above, over the prior period,
2. a decrease in communications expenses associated with the company filing
its own EDGAR report, and
3. a increase in professional fees of $1,473, associated with the acquisition
described above.
Included in total expenses is $3,000 in consulting fees and $750 in rent, which
was donated by the President of Wizbang Technologies Inc. and therefore did not
require cash.
Net loss for the period was $11,875 compared with $8,611 for the same period
last year. Expenditures with respect to the acquisition of the Dalhousie
property and the related business expansion are expected to continue. However
sales of the licensed product line are expected to increase. Wizbang
Technologies Inc. does expect to incur losses over the next several years. The
reason for this expectation of continued losses is because it is expected that
in general, and specifically travel and wage, expenses are expected to increase
with sales. In the long term it is expected that any increase in sales will
outpace increases in expenses. Additionally costs associated with raising
additional cash to begin an exploration program have not been quantified.
9
LIQUIDITY AND CAPITAL RESOURCES
- ----------------------------------
Wizbang Technologies Inc. does not expect the $9,628 in cash on hand to satisfy
its cash requirements over the next 12 months. Wizbang Technologies Inc. hopes
to generate sufficient cash flow from sales to support long term continued
operations. If sales are insufficient in the long term, then Wizbang
Technologies Inc. may need additional capital to carry out its business plan.
In the event that Wizbang Technologies Inc. requires more capital, no
commitments to provide additional funds have been made by management or other
shareholders. Accordingly, there can be no assurance that any additional funds
will be available on terms acceptable to Wizbang Technologies Inc. or at all.
Wizbang Technologies Inc.'s auditors have expressed that there is substantial
doubt regarding Wizbang Technologies Inc.'s ability to continue as a going
concern. The ability of Wizbang Technologies Inc. to achieve success with
respect to its planned principal business activity is dependent upon its
successful efforts to attain profitable operations. Wizbang Technologies Inc.
has not generated enough revenues to achieve overall profitability. There is
therefore substantial doubt regarding Wizbang Technologies Inc.'s ability to
continue as a going concern.
Other than the following, Wizbang Technologies Inc. knows of no trends, events,
or uncertainties that have or are reasonably likely to have a material impact on
its short and long term liquidity:
Wizbang Technologies Inc.'s license with Reach Technologies Inc. expires on
September 30, 2004. The license is renewable by mutual agreement between
Wizbang Technologies Inc. and Reach Technologies Inc. for additional three-year
periods. Wizbang Technologies Inc. has not yet commenced discussions with Reach
Technologies Inc. with respect to the license renewal.
Other than the license renewal discussed above, Wizbang Technologies Inc. does
not have material commitments for capital expenditures. If Wizbang Technologies
Inc. is successful in renewing its license agreement it intends to fund any
required capital expenditure though future sales revenues and/or debt or equity
financing.
Other than the license renewal discussed above and its desire to begin an
exploration program on the Dalhousie property discussed above, Wizbang
Technologies Inc. knows of no trends, events, or uncertainties that have had or
are reasonably expected to have a material impact on its revenues or income from
continuing operations. Wizbang Technologies Inc. expects no significant changes
in its number of employees.
10
RECENT ACCOUNTING PRONOUNCEMENTS
- ----------------------------------
In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. It
requires that an issuer classify a financial instrument that is within its scope
as a liability (or an asset in some circumstances). The requirements of SFAS No.
150 apply to issuers' classification and measurement of freestanding financial
instruments, including those that comprise more than one option or forward
contract. SFAS No. 150 does not apply to features that are embedded in a
financial instrument that is not a derivative in its entirety. SFAS No. 150 is
effective for financial instruments entered into or modified after May 31, 2003,
and otherwise is effective at the beginning of the first interim period
beginning after June 15, 2003, except for mandatory redeemable financial
instruments of nonpublic entities. It is to be implemented by reporting the
cumulative effect of a change in an accounting principle for financial
instruments created before the issuance date of SFAS No. 150 and still existing
at the beginning of the interim period of adoption. Restatement is not
permitted. The adoption of this standard is not expected to have a material
effect on the Company's results of operations or financial position.
In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure", which amends SFAS No. 123 to provide
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based employee compensation. In addition, SFAS
No. 148 expands the disclosure requirements of SFAS No. 123 to require more
prominent disclosures in both annual and interim financial statements about the
method of accounting for stock-based employee compensation and the effect of the
method used on reported results. The transition provisions of SFAS No. 148 are
effective for fiscal years ended after December 15, 2002. The disclosure
provisions of SFAS No. 148 are effective for financial statements for interim
periods beginning after December 15, 2002. The transition provisions do not
currently have an impact on the Company's financial position and results of
operations as the Company currently has no stock-based employee compensation.
In June, 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities". The provisions of this Statement are effective for
exit or disposal activities that are initiated after December 31, 2002, with
early application encouraged. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring)". This Statement requires
that a liability for a cost associated with an exit or disposal activity be
recognized when the liability is incurred. The Company will adopt SFAS No. 146
on January 1, 2003. The effect of adoption of this standard on the Company's
results of operations and financial position is not expected to be material.
FASB has also issued SFAS No. 145, 147 and 149 but they will not have any
relationship to the operations of the Company therefore a description of each
and their respective impact on the Company's operations have not been disclosed.
11
In June, 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities". The provisions of this Statement are effective for
exit or disposal activities that are initiated after June 30, 2003, with early
application encouraged. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring)". This Statement requires
that a liability for a cost associated with an exit or disposal activity be
recognized when the liability is incurred. The Company will adopt SFAS No. 146
on January 1, 2003. The effect of adoption of this standard on the
Company's results of operations and financial position is not expected to be
material on its financial position or results of operations.
FASB has also issued SFAS No. 145 and 147 but they will not have any
relationship to the operations of the Company therefore a description of each
and their respective impact on the Company's operations have not been disclosed.
ITEM 3: CONTROLS AND PROCEDURES
(a) EVALUATION OF CONTROLS AND PROCEDURES
Wizbang Technologies Inc.'s principal executive officer and principal financial
officer, Mike Frankenberger, has concluded, based on his evaluation as of a date
within 90 days prior to the filing date of this report, that Wizbang
Technologies Inc.'s disclosure controls and procedures are effective to ensure
that information required to be disclosed by Wizbang Technologies Inc. in the
reports filed or submitted by it under the Securities Exchange Act of 1934, as
amended, is recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, and
include controls and procedures designed to ensure that information required to
be disclosed by Wizbang Technologies Inc. in such reports is accumulated and
communicated to Wizbang Technologies Inc.'s management, including the principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding required disclosure.
(b) CHANGES IN INTERNAL CONTROLS
There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls subsequent to the date of
such evaluation including any corrective actions with regard to significant
deficiencies and material weaknesses.
12
PART II
ITEM 5. CHANGES IN SECURITIES AND USE OF PROCEEDS
a) Recent Sales Of Unregistered Securities
i. On September 22, 2000, Wizbang Technologies Inc. issued a total of
8,500,000 shares of common stock to Mike Frankenberger in exchange for $16,000
in cash. The issuance of the common stock was exempt from registration under
Regulation S. Mike Frankenberger was not a resident or citizen of the U.S. at
the time it received the offer to purchase and at the closing of the purchase of
the stock, and did not acquire the stock for the account or benefit of any U.S.
person. Mike Frankenberger agreed to resell such securities only in accordance
with the provisions of Regulation S, pursuant to registration, or pursuant to an
available exemption from registration. The stock contains a legend to the
effect that transfer is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration, or pursuant to an available exemption
from registration. Wizbang Technologies Inc. will refuse to register any
transfer of the Stock not made in accordance with the provisions of Regulation
S, pursuant to registration, or pursuant to an available exemption from
registration. The issuance of the shares was also exempt from registration under
Rule 506 of Regulation D, and sections 3(b) and 4(2) of the Securities Act of
1933, as amended, due to Mr. Frankenberger's status as the founder and initial
management of Wizbang Technologies Inc. and his status as an accredited
investor.
ii. On March 3, 2001 Wizbang Technologies Inc. issued a total of
1,600,000 shares of common stock to four foreign corporations in exchange for
$60,000 in cash. The issuance of the common stock was exempt from registration
under Regulation S. Each entity was a foreign corporation at the time it
received the offer to purchase and at the closing of the purchase of the stock,
and did not acquire the stock for the account or benefit of any U.S. person.
Each corporation agreed to resell such securities only in accordance with the
provisions of Regulation S, pursuant to registration, or pursuant to an
available exemption from registration. The stock contains a legend to the
effect that transfer is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration, or pursuant to an available exemption
from registration. Wizbang Technologies Inc. will refuse to register any
transfer of the Stock not made in accordance with the provisions of Regulation
S, pursuant to registration, or pursuant to an available exemption from
registration.
13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS
Exhibits: Exhibits required to be attached by Item 601 of Regulation S-B are
listed in the Index to Exhibits beginning on page 17 of this Form 10-QSB, which
is incorporated herein by reference.
(B) REPORTS ON FORM 8-K.
On August 1, 2003, Wizbang Technologies Inc filed a Form 8-K with respect to
"Acquisition or Disposition of Assets" as discussed in Item 2 "Management's
Discussion and Analysis of Financial Condition and Results of Operations" of
this form 10-QSB.
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.
Wizbang Technologies Inc.
Date: 08/08/03
/s/ Mike Frankenberger
- ------------------------
Mike Frankenberger
President, Chief Executive Officer Chief Financial Officer and Director
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Mike Frankenberger President, Chief Executive Officer August 8, 2003
Chief Financial Officer and Director
/s/ Mike Frankenberger Controller and August 8, 2003
Principal Accounting Officer
14
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
AND PRINCIPAL FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002
I, Mike Frankenberger, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Wizbang
Technologies 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. I as sole certifying officer am 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 is made known to me by others within this
entity, 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. I as sole certifying officer have disclosed, based on my 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
15
6. I as sole certifying officer have indicated in this quarterly report
whether 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.
Date: August 8, 2003
/s/ Mike Frankenberger
Mike Frankenberger
President, Chief Executive Officer and Chief Financial Officer
16
INDEX TO EXHIBITS
Exhibit No. Description
99.1 Certification Of Chief Executive Officer And Principal Financial
- ---- -----------------------------------------------------------------------
Officer Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906
- ---- --------------------------------------------------------------------------
Of The Sarbanes-Oxley Act of 2002
- --------------------------------------
17
EXHIBIT 99.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND
PRINCIPAL FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-QSB of Wizbang Technologies
Inc. (the "Company") for the period ended June 30, 2003 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Mike
Frankenberger, principal executive officer and principal financial officer of
the Company, hereby certify, pursuant to 18 U.S.C. (section) 1350, as adopted
pursuant to (section) 906 of the Sarbanes-Oxley Act of 2002, that, to the best
of my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.
/s/ Mike Frankenberger
Mike Frankenberger
Principal executive officer and principal financial officer
August 8, 2003
This certification accompanies the Report pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the
Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.