10QSB 1 0001.txt QUARTERLY REPORT Securities and Exchange Commission Washington, D. C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 2000 [ ] TRANSITION REPORT UNDER SECTION 14 OR 15(D) OF THE EXCHANGE ACT For the transition period from__________ to ___________ IDT VENTURE GROUP, INC. ----------------------- (Name of Registrant as specified in its charter) N/A ----------------------- (Former Name of Registrant) Florida 0-30627 65-0984553 --------- ------------ ----------- (State or other jurisdiction of (Commission File (IRS Employer incorporation or organization) No.) Identification No.) 399 South Federal Highway, Boca Raton, Florida 33432 (561)416-8338 -------------------------------------------------------------------------------- (Address and telephone number of principal executive offices) Check whether the issuer has (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months, (or such shorter period that the Registrant was required to file such report(s), 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: August 31, 2000 CLASS Outstanding at September 30, 2000 -------------------------------- --------------------------------- Common stock $.001 Par Value 899,078 IDT VENTURE GROUP, INC. PART I: FINANCIAL INFORMATION PAGE ---- Independent Accountant's Report 2 Balance Sheet as of August 31, 2000 (Unaudited) and 3 February 29, 2000 Statements of Operations for the Three Months Ended August 31, 20000 (Unaudited) and for the Six Months Ended August 31, 2000(Unaudited) and for the period February 10, 2000 (Inception) to August 31, 2000 (Unaudited) 4 Statement of Cash Flows for the Six Months Ended August 31, 2000 and For the period February 10, 2000 (Inception) to August 31, 2000 (Unaudited) 5 Notes to Financial Statements 6 Management Discussion and Analysis of Financial Condition and Results of Operations 7 IDT VENTURE GROUP, INC. (A DEVELOPMENT STAGE COMPANY) FINANCIAL STATEMENTS AS OF AUGUST 31, 2000 INDEPENDENT ACCOUNTANTS' REPORT ------------------------------- To the Board of Directors of: IDT Venture Group, Inc. We have reviewed the accompanying balance sheet of IDT Venture Group, Inc. (a development stage company) as of August 31, 2000 and the related statements of operations and cash flows for the six months then ended and for the period from February 10, 2000 (inception) to August 31, 2000. These financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles. WEINBERG & COMPANY, P.A. Boca Raton, Florida October 18, 2000 2 IDT VENTURE GROUP, INC. (A DEVELOPMENT STAGE COMPANY) BALANCE SHEET (UNAUDITED) -----------
August 31, 2000 (Unaudited) February 29, 2000 --------------- ----------------- ASSETS ------ Cash $ 425,714 $ -- --------- --------- TOTAL ASSETS $ 425,714 $ -- ------------ ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------------ LIABILITIES $ -- $ -- --------- --------- STOCKHOLDERS' EQUITY Preferred stock, $0.001 par value, 5,000,000 shares authorized, none issued and outstanding Common stock, $0.001 par value, 25,000,000 shares authorized, 884,121 and 751,700 shares issued and outstanding respectively 884 752 Additional paid-in capital 465,201 1,858 Accumulated deficit during development stage (40,321) (160) --------- --------- 425,764 2,450 Less subscriptions receivable (50) (2,450) --------- --------- TOTAL STOCKHOLDERS' EQUITY 425,714 -- --------- --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 425,714 $ -- ------------------------------------------ ========= =========
See accompanying notes to financial statements. 3 IDT VENTURE GROUP, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF OPERATIONS (UNAUDITED) -----------
Cumulative from For the Three For the Six February 10, 2000 Months Ended Months Ended (Inception) to August 31, 2000 August 31, 2000 August 31, 2000 --------------- --------------- --------------- REVENUE $ -- $ -- $ -- --------- --------- --------- OPERATING EXPENSES Advertising and promotion -- 295 455 Bank service charges 16 33 33 Employee compensation 38,947 38,947 38,947 Office and printing expense 27 386 386 Stock transfer agent fees 500 500 500 --------- --------- --------- Total Operating Expenses 39,490 40,161 40,321 --------- --------- --------- NET LOSS $ (39,490) $ (40,161) $ (40,321) --------- ========= ========= ========= Net loss per share - basic and diluted $ (.05) $ (.05) $ (.05) ========= ========= ========= Weighted average number of shares outstanding during the period - basic and dilutes 777,807 764,754 763,692 ========= ========= =========
4 See accompanying notes to financial statements. IDT VENTURE GROUP, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS (UNAUDITED) -----------
Cumulative from February 10, 2000 Six Months Ended (Inception) to August 31, 2000 August 31, 2000 --------------- ---------------- Cash flows from operating activities: Net loss $ (40,161) $ (40,321) Adjustments to reconcile net loss to net cash used in operating activitiesL Expenses paid by promoters -- 160 --------- --------- Net cash used in operating activities (40,161) (40,161) --------- --------- Cash flows from financing activities: Proceeds from issuance of common stock 465,875 465,875 --------- --------- Net cash provided by financing activities 465,875 465,875 --------- --------- NET INCREASE IN CASH 425,714 425,714 CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD -- -- --------- --------- CASH AND CASH EQUIVALENTS - END OF PERIOD $ 425,714 $ 425,714 ========= =========
See accompanying notes to financial statements. 5 IDT VENTURE GROUP, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS AS OF AUGUST 31, 2000 --------------------- NOTE 1 BASIS OF PRESENTATION ------ --------------------- The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations. It is management's opinion, however that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statements presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year. For further information, refer to the financial statements and footnotes included in the Company's Form 10-SB for the year ended February 29, 2000. NOTE 2 STOCKHOLDERS' EQUITY ------ -------------------- (A) Preferred Stock ------------------- The Company is authorized to issue 5,000,000 shares of preferred stock at $0.001 par value per share with such rights and preferences as determined by the Board of Directors. As of August 31, 2000, no shares are issued and outstanding. (B) Common Stock The Company is authorized to issue 25,000,000 shares of common stock at $.001 par value. In February 2000, the Company issued 751,700 shares of its common stock that was subscribed for to its founders and to various stockholders pursuant to Section 4(2) of the Securities Act of 1933, as amended, for an aggregate consideration of $2,450. In August 2000, the Company issued 132,421 shares of its common stock to various stockholders for an aggregate consideration of $463,475. In September 2000, the Company issued an additional 14,957 shares of its common stock to various stockholders for an aggregate consideration of $52,350. At August 31, 2000 there was a $50 subscription receivable. NOTE 3 SUBSEQUENT EVENTS The Company executed an agreement in September, 2000 for an investment of capital in a marine air conditioning business (the "investee"). Under the agreement the Company purchased a 50% non-dilutive interest in all profits of the internet and catalogue sales of the investee and 50% of the profit from any sale of the internet and catalogue sales division of the investee. The purchase compensation payments as defined in the agreement are a $300,000 payment upon signing of agreement, and two subsequent payments of $350,000. The Company is not obligated to make all of the payments under this agreement and to the extent that any monies received are below the amounts specified in this agreement, the returns specified in this agreement shall accordingly be reduced. The Company has made a payment of $200,000 in September, 2000. 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THE FOLLOWING DISCUSSION OF THE RESULTS OF OUR OPERATIONS AND FINANCIAL CONDITION SHOULD BE READ IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND THE NOTES THERETO INCLUDED ELSEWHERE IN THIS REPORT. EXCEPT FOR THE HISTORICAL INFORMATION CONTAINED HEREIN, THE DISCUSSION CONTAINED IN THIS REPORT CONTAINS "FORWARD-LOOKING STATEMENTS" THAT INVOLVE RISK AND UNCERTAINTIES. THESE STATEMENTS MAY BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS "BELIEVES," "EXPECTS," "MAY," "WILL," "SHOULD" OR "ANTICIPATES" OR THE NEGATIVE THEREOF OR SIMILAR EXPRESSIONS OR BY DISCUSSIONS OF STRATEGY. THE CAUTIONARY STATEMENTS MADE IN THIS REPORT SHOULD BE READ AS BEING APPLICABLE TO ALL RELATED FORWARD-LOOKING STATEMENTS WHEREVER THEY APPEAR IN THIS REPORT. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE DISCUSSED IN THIS REPORT. Results of Operations For the six months ended August 31, 2000 the Company has not generated any revenues. Management's efforts to date have been devoted to focusing on prospective business opportunities to effect a merger, exchange of capital stock, asset acquisition or other similar business combination In order to facilitate such a transaction and make the Company a more attractive acquisition candidate, the Company sold a total of 132,421 shares of its common stock at $3.50 per share to prospective investors and raised a total of $463,475. The Company has incurred operating losses of $39,490 for the three months ended August 31, 2000 and losses to date of $40,321. The Company will continue to incur losses until such time as an acquisition candidate is identified and, even if successful in acquiring a business or consummating a business combination, there can be no assurance that this business will be profitable. Liquidity and Capital Resources The Company has a total of $425,714 in cash and no liabilities. The Company believes that it has sufficient assets to continue with its planned operations. Subsequent Events During September 2000 the Company issued 14,957 shares of common stock to investors for $3.50 per share. The Company executed an agreement in September, 2000 for an investment of capital in a marine air conditioning business (the "investee"). Under the agreement the Company purchased a 50% non-dilutive interest in all profits of the internet and catalogue sales of the investee and 50% of the profit from any sale of the internet and catalogue sales division of the investee. The purchase compensation payments as defined in the agreement are a $300,000 payment upon signing of agreement, and two subsequent payments of $350,000. The Company is not obligated to make all of the payments under this agreement and to the extent that any monies received are below the amounts specified in this agreement, the returns specified in this agreement shall accordingly be reduced. The Company has made a payment of $200,000 in September, 2000. PART II. OTHER INFORMATION AND SIGNATURES Item 2. Changes in Securities During the past three months the Company sold a total of 132,421 shares of its common stock to investors at a cost of $3.50 per share. The issuance of the common stock was exempt from registration under section 4(2) of the Securities Act. The company intends to use the proceeds from the sale of its securities for working capital purposes and to seek investment opportunities and acquisition candidates. In September 2000 the Company sold an additional 14,957 shares of its common stock to investors at a cost of $3.50 per share. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. IDT VENTURE GROUP, INC. By: /s/ Darren Silverman, President ------------------------------------ Dated: This 18th day of October 2000. 8