10-Q 1 0001.txt U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-QSB [ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended March 31, 2000 [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Transition Period from to . Commission File No. 0-20598 e Personnel Management.com (formerly Definition, Ltd.) (exact name of registrant as specified in its charter) NEVADA 75-2293489 (State or other jurisdiction of (IRS Employer incorporation organization) Identification No.) 120 St. Croix Avenue, Cocoa Beach, FL 32931 (Address of principal executive offices, including zip code) (321) 799-3842 (Issuer's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 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 of the registrant's common stock, $0.001 par value, as of May 12, 2000: 19,959,225. E Personnel Management.com (formerly DEFINITION, LTD.) FORM 10-QSB, QUARTER ENDED MARCH 31, 2000 TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1 - Financial Statements Consolidated Balance Sheet as of March 31, 2000................. 1 Consolidated Statement of Operations for the Three Months Ended March 31, 2000............................................... 2 Consolidated Statement of Cash Flows for the Three Months Ended March 31, 2000............................................... 3 Notes to Interim Consolidated Financial Statements.............. 4 All schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto. Item 2 - Management's Discussion and Analysis.................. 5 PART II - OTHER INFORMATION Item 1 - Legal Proceedings.................................... 6 Item 2 - Changes in Securities................................ 6 Item 3 - Defaults Upon Senior Securities...................... 6 Item 4 - Submission of Matters to a Vote of Security Holders.. 6 Item 5 - Other Information.................................... 6 Item 6 - Exhibits and Reports on Form 8-K..................... 6 Signatures........................................... 6 PART I Item 1. Financial Statements. E PERSONNEL MANAGEMENT.COM (FORMERLY DEFINITION, LTD.) CONSOLIDATED BALANCE SHEET MARCH 31, 2000 AND DECEMBER 31, 1999
(Unaudited) March 31, December 31 ASSETS 2000 1999 ------ --------- ----------- Current Assets Cash and Cash Equivalents $ 105 $ 406 Other Assets Note Receivable 3,000,000 3,000,000 Other Advances 1,150 1,150 --------- --------- Total Other Assets 3,001,150 3,001,150 --------- --------- Total Assets $3,001,255 $3,001,556 ========= ========= (Unaudited) March 31, December 31, LIABILITIES AND STOCKHOLDERS' EQUITY 2000 1999 --------- ---------- Current Liabilities Accounts Payable, Trade $ 40,000 $ 40,000 Payroll Tax Liabilities 23,700 23,700 Due to Related Party 123,883 105,784 ------- -------- Total Current Liabilities 187,583 169,484 ------- -------- Total Liabilities 187,583 169,484 Stockholders' Equity Preferred Stock: Authorized $0.01 Par Value, 5,000,000 Shares; Issued and Outstanding, 1,500 and 1,500 1,500 1,500 Common Stock: Authorized $0.001 Par Value, 50,000,000 Shares; Issued and Outstanding, 14,241,227 and 12,351,227 14,241 12,351 Additional Paid In Capital 16,658,292 16,489,181 Retained Earnings (Deficit) (13,860,361) (13,670,960) ---------- ---------- Total Stockholders' Equity 2,813,672 2,832,072 Total Liabilities and ---------- ---------- Stockholders' Equity $ 3,001,255 $ 3,001,556 ========= =========
1 E PERSONNEL MANAGEMENT.COM (FORMERLY DEFINITION, LTD.) CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(Unaudited) Three Months Three Months Ended March 31, Ended March 31, 2000 1999 -------------- --------------- Revenues $ 0 $ 37,219 Cost of Revenues 0 43,910 ---------- ----------- Gross Margin 0 (6,691) Operating Expenses General and Administrative 189,401 1,818,631 ---------- ----------- Operating Loss 189,401 (1,825,322) Other Expense Interest Expense 0 2,008 --------- ----------- Net Loss Available to Common Stockholders $ (189,401) $(1,827,330) ======== ========= Basic Loss Per Common Share $ (0.01) $ (0.23) ===== ===== Basic Weighted Average Common Shares Outstanding 13,336,227 7,910,726 ========== =========
2 E PERSONNEL MANAGEMENT.COM (FORMERLY DEFINITION, LTD.) CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(Unaudited) Three Months Three Months Ended March 31, Ended March 31, 2000 1999 -------------- ------------- Cash Flows From Operating Activities Net Loss $ (189,401) $(1,827,330) Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities Depreciation and Amortization 0 143,024 Common Stock Issued for Services 171,000 1,609,405 Changes in Assets and Liabilities Increase (Decrease) in Accounts Payable, Trade 0 (12,560) ------- --------- Total Adjustments 171,000 1,739,869 ------- --------- Net Cash Used In Operating Activities (18,401) (87,461) Cash Flows From Investing Activities - - Cash Flows From Financing Activities Principal Payment on Mortgage Payable 0 (442) Advances From Related Party 18,100 58,532 ------- ------ Net Cash Provided By Financing Activities 18,100 58,090 ------- ------ Decrease in Cash and Cash Equivalents (301) (29,371) Cash and Cash Equivalents, Beginning of Period 406 31,144 ------- ------- Cash and Cash Equivalents, End of Period $ 105 $ 1,773 ======= ======= Supplemental Disclosure of Cash Flow Information: Cash paid for: Interest $ 0 $ 2,008 Income taxes $ 0 $ 0 Supplemental Schedule of Noncash Investing and Financing Activities: Issuance of Common Stock for Services Rendered $ 171,000 $1,609,405 Conversion of Debt to Equity $ 0 $ 11,975
3 E PERSONNEL MANAGEMENT.COM (FORMERLY DEFINITION, LTD.) NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2000 NOTE 1. Statement of Information Furnished ------------------------------------------- The accompanying unaudited interim consolidated financial statements have been prepared in accordance with Form 10QSB instructions and in the opinion of management contains all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2000, the results of operations for the three months ended March 31, 2000, and the statement of cash flows for the three months ended March 31, 2000. These results have been determined on the basis of generally accepted accounting principles and practices and applied consistently with those used in the preparation of the Company's 1999 Annual Report on Form 10-KSB. Certain information and footnote disclosure normally included in the financial statements presented in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that the accompanying consolidated financial statements be read in conjunction with the accompanying consolidated financial statements and notes thereto incorporated by reference in the Company's 1999 Annual Report on Form 10-KSB. NOTE 2. Acquisition of Subsidiary ---------------------------------- On March 14, 2000, the Company issued 750,000 shares of common stock to Russell P. Ferry in exchange for 75% ownership in Interstate Management Services Company (IMSC) common stock. Currently, the Company is unable to determine the book value of the subsidiary. Complete information is forthcoming, and when accurate figures are produced, the financial information for the quarter ended March 31, 2000, will be updated. The shares were issued on April 4, 2000. 4 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. When used in this discussion, the words "believes", "anticipates", "expects", and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are also urged to carefully review and consider the various disclosures made by the Company which attempt to advise interested parties of the factors which affect the Company's business, in this report, as well as the Company's periodic reports on Forms 10-KSB, 10QSB and 8-K filed with the Securities and Exchange Commission. (1) Results of Operations Revenues. The Company revenues for the three months ended March 31, 1999, were $37,219. There were no revenues for the three months ended March 31, 2000. The Company discontinued its operations from its television station, its only source of revenue, in June of 1999. No revenues have been derived since that date. The Company does not rely on revenues of funding. General and Administrative Expenses. During the three months ended March 31, 1999, the Company incurred $1,818,631 in general and administrative expenses, an decrease of $1,629,230, or 90%, from first quarter 2000 expenses of $189,401. The decrease is primarily attributable to the issuance of common stock for consulting services of $1,438,405. The Company experienced a net loss of $189,401 for the current period compared to a net loss of the prior period of $1,827,330, or an increase of $1,637,829. The majority of the loss is attributable to the common stock issued for services rendered as discussed above. Additionally, the Company's discontinuance of its television operations in June 1999, has helped to lighten the financial drain on the Company. Provision for Income Taxes. As of March 31, 2000, the Company's accumulated deficit was $13,860,361. Accordingly, the Company has recorded a full valuation allowance against any income tax benefit to date. (2) Liquidity The Company's liquidity position continues to be poor. Working capital continues to deteriorate. At March 31, 2000, the Company had a negative working capital of $187,748, as compared to $169,078 at December 31, 1999. Net advances from stockholder were $18,100 to help fund working capital operations. Due to the "start-up" nature of the Company's business, the Company expects to incur losses as it expands its business. The Company has been dependent upon funds advanced from stockholders to support its working capital needs. The Company may raise additional funds through public or private equity investment in order to expand the range and scope of its business operations, but there is no assurance that such additional funds will be available for the Company to finance its operations on acceptable terms, if at all. 5 PART II Item 1. Legal Proceedings. None. Item 2. Changes in Securities. As detailed in the financial statements, the Company issued 1,890,000 shares of its common stock during the three months ended March 31, 2000, as follows: 1. 1,140,000 shares of common stock issued for services at $0.15 per share, or $171,000. 2. 750,000 shares of common stock issued for 75% in acquisition of subsidiary. See Note 2 to interim financial statements. Item 3. Defaults Upon Senior Securities. None. Item 4. Submission of Matters to Vote of Security Holders. None. Item 5. Other Information. None. Item 6. Exhibits and Reports on Form 8-K. 1. Form 8-K filed on May 11, 2000, for name change from Definition, Ltd. to e Personnel Management.com. SIGNATURES In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. e Personnel Management.com By: _____________________ /s/ Donna Anderson President Dated: May 12, 2000 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. 6