U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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: January 31, 2002
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from __________________ to __________________
Commission file number 333-61714
INVENTOY.COM, INC.
(Exact name of small business issuer as specified in its charter)
DELAWARE 13-4128563
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
6786 WILLOWOOD DRIVE, SUITE G1006, BOCA RATON, FLORIDA 33434
(Address of principal executive offices) (Zip Code)
(561) 482-6952
Issuer's telephone number
N/A
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities 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 [ ]
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: At April 22, 2002, the issuer had
outstanding 20,884,000 shares of Common Stock.
Transitional Small Business Disclosure Format: Yes [ ] No [X]
INVENTOY.COM, INC.
JANUARY 31, 2002 QUARTERLY REPORT ON FORM 10-QSB
TABLE OF CONTENTS
Page
Number
Special Note Regarding Forward Looking Statements ...................... 3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements ................................................... 4
Item 2. Management's Discussion and Analysis or Plan of Operation............... 10
PART II - OTHER INFORMATION
Item 5. Other Information....................................................... 11
Item 6. Exhibits and Reports on Form 8-K........................................ 12
2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
To the extent that the information presented in this Report on Form 10-QSB for
the transition period ended January 31, 2002, discusses financial projections,
information or expectations about our products or markets, or otherwise makes
statements about future events, such statements are forward-looking. We are
making these forward-looking statements in reliance on the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Although we
believe that the expectations reflected in these forward-looking statements are
based on reasonable assumptions, there are a number of risks and uncertainties
that could cause actual results to differ materially from such forward-looking
statements. These risks and uncertainties are described, among other places in
this Quarterly Report, in "Management's Discussion and Analysis or Plan of
Operation".
In addition, we disclaim any obligations to update any forward-looking
statements to reflect events or circumstances after the date of this Quarterly
Report. When considering such forward-looking statements, you should keep in
mind the risks referenced above and the other cautionary statements in this
Quarterly Report.
3
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENT
Balance Sheet as of January 31, 2002 and July 31, 2001.................... 5
Statements of Operations for the three and six month periods ended January
31, 2002 and January 31, 2001 and the period from August 11, 1999 (inception)
to January 31, 2002............................................................ 6
Statements of Cash Flows for the six month periods ended January 31,
2002 and January 31, 2001 and the period from August 11, 1999 (inception) to
January 31, 2002.............................................................. 7
Notes to Financial Statements............................................ 8
4
Inventoy.com, Inc.
(A Development Stage Company)
Consolidated Balance Sheets
January 31, July 31,
2002 2001
--------- ---------
(Unaudited)
-----------
Assets
Current assets:
Cash $ 32,251 $ 62,991
--------- ---------
Total current assets 32,252 62,991
--------- ---------
Other assets:
Purchased toy designs 3,000 3,000
--------- ---------
Total assets $ 35,251 $ 65,991
========= =========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 3,854 $ 6,864
--------- ---------
Total current liabilities 3,854 6,864
Long-term liabilities:
Loan Payable 100,000 --
--------- ---------
Total liabilities 103,854 6,864
--------- ---------
Shareholders' equity:
Common stock, 20,000,000 shares
authorized; 5,211,000 shares
issued and outstanding; par
value $.001 5,211 5,211
Preferred stock, 5,000,000 shares
authorized; -0- shares issued
and outstanding; par value $.001 -- --
Additional paid in capital 78,523 81,849
Subscriptions receivable (600) (600)
Retained earnings (deficit) (151,737) (27,333)
--------- ---------
Total shareholders' equity (68,603) 59,127
--------- ---------
Total liabilities and
shareholders' equity $ 35,251 $ 65,991
========= =========
See accompanying Notes to Financial Statements.
5
Inventoy.com, Inc.
(A Development Stage Company)
Consolidated Statements of Operations
(Unaudited)
Period from
Three Months Ended Six Months Ended August 11, 1999
January 31, January 31, (inception)
----------- ----------- to January 31,
2002 2001 2002 2001 2002
---- ---- ---- ---- ----
(Unaudited) (Unaudited) (Unaudited)
----------- ----------- -----------
Revenues:
Net sales $ -0- $ -0- $ -0- $ -0- $ -0-
---------- ---------- ---------- ---------- ----------
Expenses:
General and administrative 121,902 (1,390) 124,699 7,685 153,005
---------- ---------- ---------- ---------- ----------
Total Expenses: 121,902 (1,390) 124,699 7,685 153,005
Other Income:
Interest income 109 237 294 243 1,268
---------- ---------- ---------- ---------- ----------
Net income (loss) $ (121,793) $ 1,627 $ (124,405) $ (7,442) $ 151,737
========== ========== ========== ========== ==========
Net income (loss) per share:
Basic $ (0.02) $ 0.00 $ (0.02) $ (0.01)
========== ========== ========== ==========
Diluted $ (0.02) $ 0.00 $ (0.02) $ (0.01)
========== ========== ========== ==========
Weighted average common shares used
in calculation of net income (loss)
per share 5,211,000 4,041,576 5,211,000 3,837,092
========== ========== ========== ==========
See accompanying Notes to Financial Statements.
6
Inventoy.com, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
Period from
Six Months Ended August 11, 1999
January 31, (inception)
----------- to January 31,
2002 2001 2002
--------- --------- ---------
Cash flows from operating activities:
Net loss $(124,405) $ (7,442) $(151,737)
Adjustments to reconcile net loss
to cash provided (used) for operating activities:
Common stock issued for services -- -- 50,000
--------- --------- ---------
(124,405) (7,442) (101,737)
Increase (decrease) in operating accounts payable (3,010) (378) 3,854
--------- --------- ---------
Cash provided (used) for operating activities (127,415) (7,820) (97,883)
--------- --------- ---------
Cash flows from financing activities:
Proceeds from long-term loan 100,000 -- 100,000
Proceeds of private placement offering net of
$3,325, $2,014 and $80,966 direct costs (3,325) 97,986 30,134
--------- --------- ---------
Cash provided (used) for financing activities 96,675 97,986 130,134
--------- --------- ---------
Increase (decrease) in cash (30,740) 90,166 32,251
Cash, beginning of period 62,991 -- --
--------- --------- ---------
Cash, end of period $ 32,251 $ 90,166 $ 32,251
========= ========= =========
Supplemental Disclosure of non-cash investing
and financing activities:
Receivable from shareholders in
connection with subscription
from common stock $ -- $ -- $ 600
Issuance of common stock for deferred
design costs $ -- $ -- $ 3,000
See accompanying Notes to Financial Statements.
7
Inventoy.com, Inc.
(A Development Stage Company)
Notes to Consolidated Financial Statements
(Unaudited)
1. Consolidated Financial Statements
The accompanying financial statements include the accounts of Inventoy.com, Inc.
(a development stage company). The interim statements are unaudited and, in the
opinion of management, include all adjustments (which include only normal
recurring adjustments) necessary to present fairly the Company's financial
position as of January 31, 2002 and the results of its operations and cash flows
for the interim periods presented. The balance sheet data for July 31, 2001 are
derived from the audited financial statements that are included in the Company's
report on Form SB-2 registration Statement filed on October 29, 2001, which
should be read in connection with these financial statements.
The accounting policies followed in the presentation of the interim financial
results are the same as those followed on an annual basis. Those policies are
presented in Note 3, "Significant Accounting Policies in the consolidated
financial statements included in the Company's annual report on Form SB-2.
On February 22, 2002, the Board of Directors of Inventoy.com, Inc. approved a
change of the Company's fiscal year to December 31 from July 31, effective
February 22, 2002 and a Form 10-Q/T report was filed on April 8, 2002 with the
Securities and Exchange Commission for the five-month period ended December 31,
2001.
The interim financial results as of the six months ended January 31, 2002 are
not necessarily indicative of the results that will be obtained for the year
ending December 31, 2002.
2. Supplemental Cash Flow Information
January 31 January 31
2002 2001
------ ------
Cash paid during the three months for:
Interest $ -- $ --
====== ======
Income taxes $ -- $ --
====== ======
Non-cash financing transaction:
Direct stock placement costs $ -- $3,325
====== ======
3. Promissory Notes Payable
On March 19, 2002 the Company borrowed $100,000 and executed a 5% unsecured
promissory note due March 19, 2003. Interest note begins to accrue on March 19,
2002 in accordance with the terms of the note.
4. Subsequent Events
(a) On February 15, 2002 the Board of Directors of Inventoy.com, Inc. approved a
plan, and filed an amended certificate of incorporation, to increase the
Company's authorized capital. The new capitalization plan calls for an increase
in the Company's authorized common stock from
8
Inventoy.com, Inc.
(A Development Stage Company)
Notes to Consolidated Financial Statements
(Unaudited)
3. Subsequent Events-(continued)
20,000,000 shares to 100,000,000 shares. There was no change in the number of
authorized preferred stock that remained at 5,000,000 shares.
The Company's Board of Directors, voted to forward split the outstanding common
stock of the Company, in the ratio of four (4) to one (1). The record date of
the Stock split was February 25, 2002 (the Record Date). As a result,
shareholders of record as of the close of business on the Record Date were
eligible to receive an additional three shares for every one share they held in
the Company.
As a result of the stock split the Company's 5,211,000 shares of common stock
issued and outstanding, were increased to 20,884,000 shares of common stock
issued and outstanding.
(b) On March 14, 2002 the Company signed an asset purchase agreement with
Inventoy.com International, Inc., through which Inventoy assigned all of its
rights, titles and exclusive interests in and to all patents, trademarks, trade
names, technical processes, know-how and other intellectual property associated
with the business of the Company, including the twenty seven (27) toy designs
the Company acquired from Kaplan Design Group upon its formation, in exchange
for all of the outstanding shares of Inventoy.com International, Inc., (100
shares, par value $.001).
9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion contains forward-looking statements involving risks and
uncertainties based on our current expectations and the development of our
business. All statements in this report relate to our intended business plans,
prospective financial operations and expected future growth or profitability
constitute forward-looking statements. Forward-looking statements are subject to
a number of risks and uncertainties. Our actual results may differ significantly
from those anticipated or expressed in these statements. You should read the
following discussion and analysis in conjunction with the audited financial
statements (and notes thereto) and other financial information of our company
appearing elsewhere in this report.
OVERVIEW
We were incorporated on August 11, 1999, and seek to license toy designs to toy
manufacturers and to act as a toy inventor's agent in licensing toy designs
developed by others. Additionally, we will seek revenue from the sale of banner
ads on the web page we plan to create. However, the expectation is that any
revenue from the sale of banner ads will be minimal. Our licensing efforts began
with twenty-seven toy designs which were acquired from Kaplan Design Group, a
New Jersey general partnership. We expect to market those toy designs by both
direct meetings with toy manufacturers' representatives as well as through a
website that will give the manufacturers an opportunity to review pictures and
descriptions of new inventions at a single source in order to decide whether a
face-to-face meeting would be useful.
Our plan of operations for the next twelve months includes hiring a web designer
to build our web page, and soliciting new toy designs. The web page will take
approximately four months to build and will cost approximately $25,000. We plan
to hire a web designer later this year. We will rely on Ed Kaplan and Doug
Kaplan's contacts in the toy industry to solicit new toy designs. We plan for
the web page to also solicit new toy designs. Also, during the next twelve
months, Ed Kaplan will market our current toy designs directly to toy
manufacturers' representatives.
From inception to the time of filing this report, we have been developing our
business and had no operations. We anticipate that we will be able to fund
planned operations through approximately December 31, 2002. We believe that we
will not need to raise additional funds in the next twelve months.
INTELLECTUAL PROPERTY
We have no trademark, copyright or patent protection at this time. None of the
designs we own are protected by patent protection. Generally, while some toy
designs may be entitled to patent protection, the majority of toy designs will
not meet the criteria for a utility patent protection. Some designs may be
eligible for a limited degree of protection provided by design patents. However,
in general, most designs are protected only under the law of trade secrets.
Under the law of trade secrets, the secret is legally protected only for so long
as it is not disclosed to others other than by someone under an obligation to
maintain its secrecy.
COMPETITION
We expect to face intense competition both in our efforts to market new toy
inventions to toy manufacturers and in our efforts to get new inventor customers
for whom we can act as agent. There are several other companies seeking to
assist toy inventors, one of the more successful companies is Haystack Toy
Company. Insofar as marketing toy designs to the manufacturers is concerned, the
major competition will be from the manufacturers' own in-house design
departments. There are also approximately 150 independent toy design companies,
many of which are sole proprietorships. The principal bases on which industry
participants compete is on the perceived value of the toy design concept and the
likelihood of it being manufactured and marketed.
10
PART II -- OTHER INFORMATION
ITEM 5. OTHER INFORMATION.
Subsequent to the period covered by this Report, on February 15, 2002, our Board
of Directors approved a plan and filed an Amended Certificate of Incorporation
to increase our authorized common stock from 20,000,000 shares to 100,000,000
shares. There was no change in the number of authorized preferred stock, which
remained at 5,000,000 shares. On February 15, 2002, by written consent in lieu
of a meeting, a majority stockholder holding 57% of our common stock ratified
the resolutions of the Board of Directors which approved the amendment to our
Certificate of Incorporation to increase our authorized common stock from
20,000,000 shares to 100,000,000 shares.
Subsequent to the period covered by this Report, a report of Form 8-K was filed
on February 28, 2002 reporting that we had changed our fiscal year to December
31 form July 31, effective February 22, 2002.
Subsequent to the period covered by this Report, on February 25, 2002, our Board
of Directors voted to forward split our outstanding common stock, in the ratio
of four (4) to one (1). The record date of the stock split was February 25, 2002
(the "Record Date"). As a result, shareholders of record as of the close of
business on the Record Date were eligible to receive an additional three shares
of common stock for every share of common stock that they held.
As a result of the stock split, our 5,211,000 shares of common stock issued and
outstanding were increased to 20,884,000 shares of common stock issued and
outstanding.
Subsequent to the period covered by this Report, on March 14, 2002, by written
consent in lieu of a meeting, a majority stockholder holding 57% of our common
stock ratified the resolutions of the Board of Directors which approved the
asset purchase agreement with Inventoy.com International, Inc., through which we
assigned all of our rights, titles and exclusive interests in and to all
patents, trademarks, trade names, technical processes, know-how and other
intellectual property associated with our business, including the twenty seven
(27) toy designs which we acquired from Kaplan Design Group upon our formation,
in exchange for all of the outstanding shares of Inventoy.com International,
Inc., (100 shares, par value $.001).
Subsequent to the period covered by this Report, on April 23, 2002, we entered
into an agreement to acquire 100% of the outstanding common shares of Assure Oil
& Gas Corp., an Ontario, Canada company ("Assure"). Pursuant to the acquisition
agreement, we will issue two million four hundred thousand (2,400,000) units
(the "Units") to the former shareholders of Assure in exchange for all of
Assure's outstanding common shares. Each Unit consists of one (1) share of the
Company's common stock; one (1) A Warrant entitling the holder to acquire
another share of our common stock at $0.50 per share for up to five years from
the date of issue and one (1) B Warrant entitling the holder to acquire another
share of our common stock at $1.00 per share for up to five years from the date
of issue. Upon completion of the acquisition of Assure, we will change our name
to Assure Energy, Inc., replace one current director with one director of Assure
and have 23,284,000
11
shares of common stock issued and outstanding. A current report on Form
8-K will be timely filed detailing the terms of the agreement.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Exhibit
Number Description
------ -----------
2.1 Asset Purchase Agreement dated March 14, 2002 between
Inventoy.com, Inc. and Inventoy.com International, Inc.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the quarter ended January 31,
2002.
12
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on this 29th day of
April, 2002.
INVENTOY.COM, INC.
By: /s/ Douglas Kaplan
----------------------------------
Douglas Kaplan, President, CEO and
Chairman of the Board (principal
financial officer)
13