-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, A+2xThkC442m6qC5fx0/+ROdyPzgsNOzZzU5nH54RrwnvzKfSeF+1JRiRfIGcxJC 1bGK5Z9XyCWJNDaKCFm2Xg== 0000950147-99-001443.txt : 19991217 0000950147-99-001443.hdr.sgml : 19991217 ACCESSION NUMBER: 0000950147-99-001443 CONFORMED SUBMISSION TYPE: 10QSB/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19991216 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SOLPOWER CORP CENTRAL INDEX KEY: 0001068618 STANDARD INDUSTRIAL CLASSIFICATION: CHEMICALS & ALLIED PRODUCTS [2800] IRS NUMBER: 870384678 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB/A SEC ACT: SEC FILE NUMBER: 000-29780 FILM NUMBER: 99775942 BUSINESS ADDRESS: STREET 1: 7309 EAST STETSON DRIVE STREET 2: STE 102 CITY: SCOTTSDALE STATE: AZ ZIP: 85251 BUSINESS PHONE: 6029476366 MAIL ADDRESS: STREET 1: 7309 EAST STETSON DR STREET 2: STE 102 CITY: SCOTTSDALE STATE: AZ ZIP: 85251 10QSB/A 1 QUARTERLY REPORT FOR PERIOD ENDING 6-30-99 ================================================================================ U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB/A (Amendment No. 1) (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1999 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT For the transition period from _____________ to _______________ Commission File Number 001-14439 SOLPOWER CORPORATION (Exact name of small business issuer as specified in its charter) Nevada 87-0384678 (State or other jurisdiction of (IRS Employer Identification No.) Incorporation or organization) 7309 East Stetson Drive, Suite 102 Scottsdale, Arizona 85251 (Address of principal executive offices) (480) 947-6366 (Issuer's telephone number) 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 shares outstanding of each of the issuer's classes of common equity was 23,391,560 shares of common stock, par value $.01, as of December 31, 1998. Transitional Small Business Disclosure Format (check one): Yes [X] No [ ] ================================================================================ SOLPOWER CORPORATION INDEX TO FORM 10-QSB/A FILING FOR THE QUARTER ENDED JUNE 30, 1999 TABLE OF CONTENTS PART I FINANCIAL INFORMATION Page ---- Item 1. Financial Statements............................................... 2 Balance Sheet June 30, 1999 (unaudited) and March 31, 1999..................... 2 Statements of Operations Three Months Ended June 30, 1999 (unaudited) and 1998 (unaudited) 4 Statement of Cash Flows Three Months Ended June 30, 1999 (unaudited) and 1998 (unaudited) 5 Notes to the Financial Statements................................... 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............................................... 6 PART II. OTHER INFORMATION None. SIGNATURES PART I FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS SOLPOWER CORPORATION BALANCE SHEET JUNE 30, 1999 (UNAUDITED) AND MARCH 31, 1999 ASSETS June 30, 1999 March 31, 1999 ------------- -------------- (unaudited) (audited) Current Assets Cash and Cash Equivalents $ 33,833 $ 2,228 Accounts Receivables 46,336 50,145 Inventory 82,532 92,178 ---------- ---------- Total Current Assets 162,701 144,551 ---------- ---------- Property & Equipment, net 389,202 399,262 ---------- ---------- Other Assets Marketing Rights 2,633,333 2,658,333 Security Deposits 13,922 13,922 License Fee Receivable 2,400,000 2,400,000 ---------- ---------- Total Other Assets 5,047,255 5,072,255 Total Assets $5,599,158 $5,616,068 ========== ========== The accompanying notes are an integral part of these financial statements. 2 SOLPOWER CORPORATION BALANCE SHEET JUNE 30, 1999 (UNAUDITED) AND MARCH 31, 1999 LIABILITIES AND STOCKHOLDERS' EQUITY June 30, 1999 March 31, 1999 ------------- -------------- (unaudited) (audited) Current Liabilities Lease Payable - Current $ 2,677 $ 4,060 Loans Payable - Related Parties 14,958 13,500 Accounts Payable 380,485 429,409 Accrued Expenses 233,327 213,792 ----------- ----------- Total Current Liabilities 631,447 660,761 ----------- ----------- Long Term Liabilities Loans Payable - Related Parties 863,218 407,219 Accrued Expenses Noncurrent 70,000 70,000 Deferred Revenue 2,400,000 2,400,000 ----------- ----------- Total Long Term Liabilities 3,333,218 2,877,219 ----------- ----------- Total Liabilities 3,964,665 3,537,980 ----------- ----------- Commitments and Contingencies Stockholders' Equity Preferred Stock; $0.001 Par Value, 5,000,000 Shares Authorized; -- -- Issued and Outstanding, None Common Stock; $0.01 Par Value, 30,000,000 Shares Authorized; 234,566 234,566 Issued and Outstanding 23,456,560 Shares at June 30, 1999 and March 31, 1999 Additional Paid in Capital 6,736,525 6,736,525 Accumulated Deficit (5,336,598) (4,893,003) ----------- ----------- Total Stockholders' Equity 1,634,493 2,078,088 ----------- ----------- Total Liabilities and Stockholders' Equity $ 5,599,158 $ 5,616,068 =========== =========== The accompanying notes are an integral part of these financial statements. 3 SOLPOWER CORPORATION STATEMENT OF OPERATIONS FOR THE THREE MONTH PERIODS ENDED JUNE 30, 1999 (UNAUDITED) AND 1998 (UNAUDITED) For the Three Month Periods Ended --------------------------------- June 30, 1999 June 30, 1998 ------------- ------------- (unaudited) (audited) Revenue Sales - Product $ 25,439 $ 25,802 License Fees -- -- ------------ ------------ Total Revenues 25,439 25,802 Cost of Sales 132,966 -- ------------ ------------ Gross Profit (107,526) 25,802 Expenses General and Administrative 335,928 458,779 ------------ ------------ Operating Loss (443,454) (432,977) ------------ ------------ Other Income (Expense) Interest Income 0 309 Interest Expense 140 (462) ------------ ------------ Total Other Income (Expense) (140) (153) ------------ ------------ Net Loss Before Provision for Income Taxes (443,454) (433,130) Provision for Income Taxes -- -- ------------ ------------ Net Loss $ (443,454) $ (433,130) ============ ============ Basic (Loss) Per Share $ (0.02) $ (0.02) ============ ============ Weighted Average Number of Shares Outstanding 23,443,492 17,891,560 ============ ============ The accompanying notes are an integral part of these financial statements. 4 SOLPOWER CORPORATION STATEMENT OF CASH FLOWS FOR THE THREE MONTH PERIODS ENDED JUNE 30, 1999 (UNAUDITED) AND 1998 (UNAUDITED) For the Three Month Periods Ended --------------------------------- June 30, 1999 June 30, 1998 ------------- ------------- (unaudited) (audited) Cash Flows From Operating Activities: Net Loss $(443,595) $ (433,130) Adjustments to reconcile net loss to net cash by operating activities Depreciation and amortization 50,714 71,869 Changes in operating assets and liabilities Accounts receivables (3,808) (38,803) License fee receivable -- (2,397,762) Prepaid expense -- 2,917 Inventory 9,646 7,076 Accounts payable (48,924) (2,432) Accrued expense 19,535 -- Deferred revenue -- 2,400,000 --------- ----------- Net cash used by operating activities (408,816) (390,265) --------- ----------- Cash Flows from Investing Activities: Purchase of property and equipment (15,653) (22,383) --------- ----------- Net cash used by investing activities (15,653) (22,383) --------- ----------- Cash Flows from Financing Activities Payment received on stock subscriptions -- 100,000 Payments on lease payable (1,383) (1,058) Loans and Advances from related parties 457,457 130,169 --------- ----------- Net cash provided by financing activities 456,074 229,111 --------- ----------- Increase (Decrease) in Cash and Cash Equivalents $ 31,604 ($ 183,537) Cash and Cash Equivalents, Beginning of Period 2,228 183,842 --------- ----------- Cash and Cash Equivalents, End of Period $ 33,832 $ 305 --------- ----------- SUPPLEMENTAL INFORMATION Cash Paid For: Interest $ 140 $ 462 ========= =========== Income Taxes 0 0 ========= =========== The accompanying notes are an integral part of these financial statements. 5 SOLPOWER CORPORATION NOTES TO THE FINANCIAL STATEMENTS FOR THE THREE MONTH PERIOD ENDING JUNE 30, 1999 NOTE 1 - BASIS OF PREPARATION The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and Article 10 of Regulation S-X. These statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended June 30, 1999 are not necessarily indicative of the results that may be expected for the year ended March 31, 2000. The unaudited condensed financial statements should be read in conjunction with the financial statements and footnotes thereto for the year ended March 31, 1999 included in the Company's report on form 10-KSB. NOTE 2 - LICENSE FEE RECEIVABLES On May 14, 1999, the Company terminated its Master License Agreement with Masters Marketing Group, holder of the Great Lakes (Ohio, Indiana, Illinois, Michigan, Wisconsin) license. The Company regains the right to operate the Great Lakes territory as a corporate sales territory in exchange for cancellation of the Promissory Note of $1,080,000, issuance of 15,000 shares of stock and repayment of the license fee downpayment of $120,000. The downpayment is to be repaid at $5,000 per month without interest. See Note 4 of the footnotes accompanying the March 31, 1999 audited financial statements. This transaction is reflected in the financial statements as of March 31, 1999. On September 7, 1999, the Company terminated its Master License Agreement with Solpower Southeast Corporation. The Company regains the right to operate the Southeast territory (Alabama, Arkansas, Florida, Georgia and Mississippi) as a corporate sales territory in exchange for cancellation of the Promissory Note of $1,080,000, repayment of the license fee downpayment of $120,000 and the issuance of 20,000 shares of stock. The downpayment is expected to be refunded by October 30, 1999. See Note 4 of the footnotes accompanying the March 31, 1999 audited financial statements. This transaction is reflected in the financial statements as of March 31, 1999. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THREE MONTHS ENDED JUNE 30, 1998 Revenues for the three months ended June 30, 1999 were $25,439 as compared to revenues of $25,082 for the three months ended June 30, 1998. The Company recovered the Territorial Licenses previously sold to Solpower Southeast Corporation and Masters Marketing Group and is operating those areas as Company territories. The increase in revenues resulted primarily from improved sales in several expanding regional markets during the three-month period ended June 30, 1999 compared to the year ended March 31, 1999. 6 The Company's operation of the areas formerly covered by Territorial Licenses are expected to generate substantially more revenue for the Company than with the licensee arrangement. General and administrative costs were $295,929 for the quarter ended June 30, 1999 compared to $458,779 for the three months ended June 30, 1998. The 35% reduction in costs were due, to a reduction in the number of area sales managers and a reduction in the other non-recurring expenses associated with starting operations. Cash flow of $416,074 was provided by related party advances and convertible notes payable for the three months ended June 30, 1999 as compared with $230,169 received from related party advances and stock subscription payments for the three month period ended June 30, 1998. The Company experienced a net loss of $403,595 for the three months ended June 30, 1999 as compared with $433,130 for the three months ended June 30, 1998. LIQUIDITY AND CAPITAL RESOURCES The Company anticipates future liquidity needs will continue to be met through equity and debt financings primarily from its major shareholder, Dominion Capital Pty Ltd., until such time as cash flow from operations are sufficient to meet the Company's capital requirements for product production and operations. PART II OTHER INFORMATION NONE. SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed by the undersigned, thereunto duly authorized. SOLPOWER CORPORATION (Registrant) Dated: December 18, 1999 By /s/ James H. Hirst -------------------------------- James H. Hirst Chief Executive Officer 7 EX-27 2 FINANCIAL DATA SCHEDULE
5 3-MOS MAR-31-2000 APR-01-1999 JUN-30-1999 33,833 0 46,336 0 82,532 162,701 0 389,202 5,599,158 631,447 0 0 0 234,566 1,399,927 5,599,158 25,439 25,439 132,966 0 335,928 0 140 (443,454) 0 (443,454) 0 0 0 (443,454) (0.02) 0
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