SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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, 2002
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[ ] TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE EXCHANGE ACT
For the transition period from __________ to _____________
Commission file number 000-13337
Buy It Cheap.com, Inc.
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(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 22-2497491
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1800 Bloomsbury Avenue, Ocean, NJ 07712
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(Address of principal executive offices)
732-922-3355
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(Issuer's telephone number)
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(Former name, former address and former fiscal year,
if changed since last report)
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 [ ]
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:
9,040,582 shares of Common Stock,
$.001 par value per share, at October 16, 2002.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements of Buy It Cheap.com, Inc. (unaudited)
Balance Sheet as of September 30, 2002 and June 30, 2002.
Statements of Loss for the three month periods ended
September 30, 2002 and September 30, 2001 and the period
July 19, 1999 to September 30, 2002.
Statements of Cash Flows for the three months ended
September 30, 2002 and for the period July 19, 1999 to
September 30, 2002.
Notes to Financial Statements
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BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Balance Sheets
(Unaudited)
As of
September 30, 2002 June 30, 2002
Assets ------------------ -------------
Current assets:
Cash $ 20,261 $ 6,371
Other current assets 1,000 1,000
-------- -------
Total current assets 21,261 7,371
-------- -------
Investment in and net advances to
joint venture 620,535 620,535
Reserve against investment in and net
advances to joint venture (620,535) (620,535)
Property and equipment, net of
depreciation 5,366 8,358
------- -------
Total assets $ 26,627 $ 15,729
======= =======
Liabilities and Equity
Current liabilities:
Accounts payable $ 154,372 $ 154,945
Due to officers and directors 5,559 5,559
Convertible note payable 16,198 16,198
Due to stockholder 20,000 -
------- -------
Total current liabilities 196,129 176,702
------- -------
Total liabilities 196,129 176,702
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Stockholders' equity:
Preferred stock - Series C, $.001 par
Authorized - 2,000,000 shares
Issued and outstanding - 10,000 shares 10 10
Common stock - $.001 par
Authorized - 20,000,000 shares
Issued and outstanding -
9,190,802 shares issued and 9,040,582
shares outstanding 9,191 9,191
Paid in capital 787,140 767,540
Treasury stock (751,100) (751,100)
Deficit accumulated during
the development stage (214,739) (206,213)
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Total stockholders' equity (169,502) (160,973)
------- -------
Total Liabilities and Equity $ 26,627 $ 15,729
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See Notes to the Financial Statements
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BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Loss
(Unaudited)
Cumulative
from July 19, 1999
For the three months ended to
September 30, September 30,
2002 2001 2002
----------- ------------- --------------------
Revenues $ - $ - $ -
------- ------- -------
Direct operating costs 675 1,610 21,231
General and administrative
expenses 7,852 17,247 193,509
------- ------- -------
Total expenses 8,527 18,857 214,740
------- ------- -------
Net loss $ (8,527) $ (18,857) $ (214,740)
======= ======= =======
Weighted average number
of shares Outstanding 9,040,175 8,840,175 8,033,186
========= ========= =========
Loss per common share $ - $ - $ .03
========= ========= =========
Loss per common share
assuming dilution $ - $ - $ .03
========= ========= =========
See Notes to Financial Statements
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BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
Cumulative
from July 19, 1999
For the three months ended to
September 30, September 30,
2002 2001 2002
----------- ------------- -------------------
Cash flows from operating
activities:-
Net loss $ (8,527) $ (18,857) $(214,740)
Adjustments to reconcile
net loss to net cash used
by operating activities:
Depreciation and
amortization 2,992 2,992 32,909
Changes in assets and
liabilities
Other current assets - - (1,000)
Accounts payable (573) (15,728) 19,442
------- -------- --------
Net cash used by operating
activities (6,108) (31,593) (163,389)
------- -------- -------
Cash flows from investing
activities
Purchase of property and
equipment - - (23,275)
Cash acquired - - 1,927
------- -------- -------
- - (21,348)
------- -------- -------
Cash flows from financing
activities:
Sale of Common stock - 20,000 185,000
Loan from stockholder 20,000 - 20,000
------- -------- -------
20,000 20,000 205,000
------- -------- -------
Net increase (decrease) in
cash 13,892 17,197 20,263
Cash at beginning of period 6,371 12,452 -
------- -------- -------
Cash at end of period $ 20,263 $ 29,649 $ 20,263
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SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Liabilities assumed in the acquisition of Northeast
(USA) Corp. for common stock $(190,957)
Accounts payable satisfied by issuance of common stock
and convertible note payable 32,395
Software costs financed by issuance of common stock 15,000
-------
$ (123,562)
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See Notes to Financial Statements
-5-
Buy It Cheap.com, Inc.
(A Development Stage Company)
Notes to Financial Statements
(Unaudited)
Summary of Significant Accounting Policies
Basis of Presentation
The interim financial statements included in this report have been prepared
by Buy It Cheap.com, Inc. (the "Company") without audit in accordance with
generally accepted accounting principles and pursuant to the rules and
regulations of the Securities and Exchange Commission for interim financial
information. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although the Company believes that the disclosures made are
adequate to make the information presented not misleading.
In the opinion of management, the information furnished for the three-month
periods ended September 30, 2002 and 2001 includes all adjustments, consisting
solely of normal recurring accruals, necessary for a fair presentation of the
financial results for the respective interim periods. The results of
operations for the three month period ended September 30, 2002 are not
necessarily indicative of the results of operations to be expected for the
fiscal year ending June 30, 2003. It is suggested that the interim financial
statements be read in conjunction with the audited financial statements of
the Company for the year ended June 30, 2002, as filed with the Securities
and Exchange Commission on Form 10-KSB.
Net Loss Per Common Share
The weighted average number of common shares outstanding used in computing
net loss per common share was 9,040,175 and 8,840,175 for the three month
periods September 30, 2002 and 2001 respectively. The weighted average number
of common shares used in computing the net loss per common share does not
include any shares issuable upon the assumed conversion of the preferred stock
since the effect would be anti-dilutive.
Due to Stockholder
During the quarter, a stockholder made a $20,000 advance to the Company. The
characterization of the advance and its use by the Company has not yet been
determined.
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Item 2. Management's Discussion and Analysis or Plan of Operation
The Company entered the Internet retailing business through the
formation of a separate entity by two of its directors. The new entity was
able to raise limited start-up capital for an Internet retailing business.
For accounting purposes, the combination of the two companies was treated as
an acquistion of the Company by this new entity. Subsequent to the completion
of this acquisition the Company changed its name to Buy It Cheap.com, Inc.
and commenced an Internet retailing operation under the website
"Buyitcheap.com." The Company must still arrange settlement of its liabilities
and raise substantial new investment capital in order to effectively develop
this business.
Financial and Operating Plan for the Next 12 Months
The Company plans to operate over the next 12 months with little
overhead consisting primarily of office rental, transfer agent fees, web
hosting and professional fees. No salaries or wages are currently paid.
While the Company is currently readying its website, it cannot predict with
certainty when the site will be fully operational. Until there is positive
cash flow from its Internet business, or the Company is able to raise a
substantial amount of new capital, there will be few, if any paid employees.
The Company plans that sales transactions, for the most part, will be handled
automatically over the Internet requiring little labor or office space
requirements. The Company believes it can become a viable business within 12
months (subject to the outcome of previously described legal proceedings) if
it is able to raise additional capital. The objective of the Company will be
to establish the viability necessary to attract substantial new investment
capital to expand its business.
DISCLOSURE REGARDING FORWARD LOOKING STATEMENTS
This Quarterly Report on Form 10-QSB contains forward-looking statements
within the meaning of the Private Securities Litigation Act of 1995 and
Section 21E of the Securities Exchange Act of 1934, as amended, that are
based on the beliefs of the Company's management as well as assumptions made
by and information currently available to the Company's management. The
Company desires to take advantage of the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995 and is making this cautionary
statement in connection with such safe harbor provisions. When used in this
Quarterly Report on Form 10-QSB, the words "estimate," "project," "believe,"
"anticipate," "intend," "expect," "plan," "predict," "may," "should," "will,
"the negative thereof and similar expressions are intended to identify
forward-looking statements.
Forward-looking statements are inherently subject to risks and
uncertainties, many of which cannot be predicted with accuracy and some of
which might not even be anticipated. Future events and actual results,
financial and otherwise, could differ materially from those set forth in or
contemplated by the forward-looking statements contained herein. Important
factors that could contribute to such differences include, but are not limited
to, the fact that the Company is in the early stages of developing its
Internet retailing business, the Company's dependence on growth of the
Internet, rapid technological changes in the market, the effect of
substantial competition in the Internet retail market, the effect of changes
in governmental regulation of the Internet and the effect of general economic
and market conditions. Other factors may be described from time to time in
the Company's other filings with the Securities and Exchange Commission, news
releases and other communications. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
hereof. The Company does not undertake any obligation to release publicly
any revisions to these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
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Item 3. Controls and Procedures
Anthony J. Consi, our Chief Executive Officer, and Stephen E. Roman,
Jr., our Chief Financial Officer, performed an evaluation of the Company's
disclosure controls and procedures within 90 days prior to the filing date
of this report. Based on their evaluation, they concluded that the controls
and procedures in place are sufficient to assure that material information
concerning the Company which could affect the disclosures in the Company's
quarterly and annual reports is made known to them by the other officers and
employees of the Company, and that the communications occur with promptness
sufficient to assure the inclusion of the information in the then-current
report.
There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect those controls subsequent
to the date on which Messrs. Consi and Roman performed their evaluation.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
None
(b) Current Reports on Form 8-K filed during the quarter ended
September 30, 2002
None.
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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.
BUY IT CHEAP.COM, INC.
/s/ Stephen E. Roman, Jr.
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Date: November 12, 2002 Signature
Stephen E. Roman, Jr.
Vice President and Principal
Accounting Officer
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CERTIFICATION FOR 10-QSB
I, Anthony J. Consi, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Buy It Cheap.com,
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 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:
_______________________
Anthony J. Consi
President and CEO.
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CERTIFICATION FOR 10-QSB
I, Stephen E. Roman, Jr., certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Buy It Cheap.com,
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 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:
_______________________
Stephen E. Roman, Jr.
Vice President and CFO.
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