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, 2003
[ ] 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 15, 2003.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements of Buy It Cheap.com, Inc.
Balance Sheet as of September 30, 2003 and June 30, 2003.
Statements of Loss (unaudited) for the three month periods ended
September 30, 2003 and 2002 and for the period July 19, 1999
to September 30, 2003.
Statements of Cash Flows (unaudited) for the three months ended
September 30, 2003 and 2002 and for the period July 19, 1999
to September 30, 2003.
Notes to Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Balance Sheets
(Unaudited)
As of
----------------------------------
September 30, 2003 June 30, 2003
Assets
Current assets:
Cash $ 278 $ 563
Other current assets 1,000 1,000
------- -------
Total current assets 1,278 1,563
Property and equipment, net of
depreciation 1,484 1,781
------- -------
Total assets $ 2,762 $ 3,344
======= =======
Liabilities and Equity
Current liabilities:
Accounts payable $ 155,885 $ 153,944
Due to officers and directors 5,559 5,559
Convertible note payable 16,198 16,198
Due to stockholder 22,500 20,000
-------- --------
Total current liabilities 200,142 195,701
-------- --------
Total liabilities 200,142 195,701
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 9,190 9,190
Paid in capital 787,140 787,140
Treasury stock (751,100) (751,100)
Deficit accumulated during the
development stage (242,618) (237,597)
-------- --------
Total stockholders' equity (197,378) (192,357)
Total Liabilities and Equity $ 2,762 $ 3,344
======== ========
See Notes to the Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Loss
(Unaudited)
For the three Cumulative
months ended from July 19, 1999
September 30, to September 30,
2003 2002 2003
-------------------------------------------
Revenues $ - $ - $ -
------- ------- --------
Direct operating costs 696 675 24,083
General and administrative
expenses 4,325 7,852 218,535
------- ------- --------
Total expenses 5,021 8,527 242,618
------- ------- --------
Net loss $ (5,021) $ (8,527) $(242,618)
======= ======= ========
Weighted average number of
shares outstanding 9,040,582 9,040,582
========= =========
Loss per common share $ - $ -
======= ========
Loss per common share assuming
dilution $ - $ -
======= ========
See Notes to Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
For the three Cumulative
months ended from July 19, 1999
September 30, to September 30,
2003 2002 2003
-------------------------------------------
Cash flows from operating
activities:-
Net loss $ (5,021) $ (8,527) $ (242,618)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Depreciation and amortization 297 2,992 36,791
Changes in assets and liabilities
Other current assets - - (1,000)
Accounts payable 1,939 (573) 20,953
-------- -------- ---------
Net cash used by operating
activities (2,785) (6,108) (185,874)
-------- -------- ---------
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 - - 185,000
Loan from stockholder 2,500 20,000 22,500
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2,500 20,000 207,500
-------- -------- ---------
Net increase (decrease) in cash (285) 13,892 278
Cash at beginning of period 563 6,371 -
-------- -------- ---------
Cash at end of period $ 278 $ 20,263 $ 278
======== ======== =========
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)
=========
See Notes to Financial Statements
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, 2003 and 2002 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 periods ended September 30, 2003 are not
necessarily indicative of the results of operations to be expected for the
fiscal year ending June 30, 2004. 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, 2003, 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 9,040,582 for each of the three month periods
September 30, 2003 and 2002. 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 current fiscal year, a stockholder made a $2,500 advance to the
Company. The characterization of the advance and its use by the Company has
not yet been determined.
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 acquisition
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
planned to 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 of the actual start
of operations (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.
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 as of September 30, 2003. 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
31. Rule 13a-14(a) Certification
32. Rule 13a-14(a) Certification
(b) Current Reports on Form 8-K filed during the quarter ended
September 30, 2003
None.
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.
-----------------------------
Date: October 31, 2003 Signature
Stephen E. Roman, Jr.
Vice President and Principal
Accounting Officer
EXHIBIT 31: Rule 13a-14(a)CERTIFICATION
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 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 report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the small business issuer as of, and for, the periods presented in this
report;
4. The small business issuer'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
small business issuer and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the small business issuer,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
report is being prepared;
b) Evaluated the effectiveness of the small business issuer's disclosure
controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
c) Disclosed in this report any change in the small business issuer's
internal controls over financial reporting that occurred during the small
business issuer's most recent fiscal quarter (the small business issuer's
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting; and
5. The small business issuer's other certifying officers and I have
disclosed, based on our most recent evaluation of internal controls over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the small business issuer's ability
to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the small business issuer's
internal controls over financial reporting.
Date: October 31, 2003 /s/ Anthony J. Consi
-----------------------------------------
Anthony J. Consi, Chief Executive Officer
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 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 report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the small business issuer as of, and for, the periods presented in this
report;
4. The small business issuer'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
small business issuer and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the small business issuer,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
report is being prepared;
b) Evaluated the effectiveness of the small business issuer's disclosure
controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
c) Disclosed in this report any change in the small business issuer's
internal controls over financial reporting that occurred during the small
business issuer's most recent fiscal quarter (the small business issuer's
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting; and
5. The small business issuer's other certifying officers and I have
disclosed, based on our most recent evaluation of internal controls over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the small business issuer's ability
to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the small business issuer's
internal controls over financial reporting.
Date: October 31, 2003 /s/ Stephen E. Roman, Jr.
-----------------------------------------------
Stephen E. Roman, Jr., Chief Financial Officer
* * * * *
EXHIBIT 32: Rule 13a-14(b) CERTIFICATION
The undersigned officers certify that this report fully complies with the
requirements of Section 13(a) of the Securities Exchange Act of 1934, and
that the information contained in the report fairly presents, in all material
respects, the financial condition and results of operations of Buy It
Cheap.com, Inc.
A signed original of this written statement required by Section 906 has been
provided to Buy It Cheap.com, Inc. and will be retained by Buy It Cheap.com,
Inc. and furnished to the Securities and Exchange Commission or its staff
upon request.
October 31, 2003 /s/ Anthony J. Consi
---------------------------
Anthony J. Consi
(Chief executive officer)
/s/ Stephen E. Roman, Jr.
---------------------------
Stephen E. Roman, Jr.
(Chief financial officer)