10QSB 1 exmailit0603q.txt QUARTERLY REPORT UNITED STATES 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 June 30, 2003 [ ] Transition report under Section 13 or 15(d) of the Exchange Act For the transition period from to ------- -------- Commission File Number: 0-49763 eXmailit.com ---------------------------------------------------- (Exact name of Registrant as specified in its charter) Nevada 88-0469593 --------------------------- ----------------- (State or other jurisdiction (I.R.S. Employer of incorporation or organization Identification No.) 530-999 West Hastings St. Vancouver, B.C., Canada V6C 2W2 (604) 688-4060 --------------------------------- ----------------------------- (Address of principal executive (Registrant's telephone number, offices) including area code) None ----------------------------------------------------------------- Former Name, Address and 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 The number of shares outstanding of the registrant's common stock as of June 30, 2003 was 4,000,000. Registrant's common stock is listed on the OTC Bulletin Board under the symbol "EXMA". Transitional Small Business Disclosure Format: Yes No X 1 PART I - Financial Information Item 1. Financial Statements The interim financial statements for eXmailit.com (the Company) included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair presentation of the Company's financial position and the results of its operations for the interim periods presented. Because of the nature of the Company's business, the results of operations for the three and six months ended June 30, 2003 are not necessarily indicative of the results that may be expected for the full fiscal year. The financial statements included herein should be read in conjunction with the financial statements and notes thereto included in the Form 10-KSB for the year ended December 31, 2002, which can be found on the SEC website at www.sec.gov, under CIK Number 0001132810. 2
eXmailit.com A DEVELOPMENT STAGE COMPANY INTERIM STATEMENT OF FINANCIAL POSITION Unaudited - see the Review Engagement Report ------------------------------------------------------------------------------ AS AT AS AT JUNE 30 31 DECEMBER 2003 2002 --------------- --------------- CURRENT ASSETS Cash $ 12,539 $ 19,295 ----------- ----------- Total current assets 12,539 19,295 ----------- ----------- EQUIPMENT AND SOFTWARE, NOTE 3 Office and computer equipment and software, at cost 14,560 14,560 Accumulated amortization 7,238 6,557 ----------- ----------- Unamortized cost 7,332 8,003 ----------- ----------- ----------- ----------- TOTAL ASSETS $ 19,861 $ 27,298 =========== =========== CURRENT LIABILITIES Accounts payable $ 1,901 $ 2,250 Loans payable, Note 4 75,000 75,000 ----------- ----------- Total current liabilities 76,901 77,250 ----------- ----------- STOCKHOLDERS' EQUITY (DEFICIENCY IN ASSETS) Share capital, Note 5 4,000 4,000 Additional paid in capital 49,000 49,000 Currency translation adjustment 3,639 1,691 Deficit accumulated during the development stage (113,679) (104,643) ----------- ----------- Total stockholders'equity (deficiency in assets) (57,040) (49,952) ----------- ----------- ----------- ----------- TOTAL LIABILITIES AND DEFICIENCY IN ASSETS $ 19,861 $ 27,298 =========== ===========
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eXmailit.com A DEVELOPMENT STAGE COMPANY INTERIM STATEMENT OF RESULTS OF OPERATIONS Unaudited - see the Review Engagement Report -------------------------------------------------------------------------------- FROM INCEPTION, 6 APRIL FOR THE THREE FOR THE SIX 2000 MONTHS ENDED MONTHS ENDED TO -------------------- ------------------ 30 JUNE 30 JUNE 30 JUNE 30 JUNE 30 JUNE 2003 2003 2002 2003 2002 ---------- --------- --------- -------- -------- EXPENSES Accounting, legal and professional fees $ 4,231 $ 3,860 $ 7,492 $ 7,196 $ 66,508 Advertising - - - - 647 Bank charges and interest 108 58 152 87 956 Dues and subscriptions - - - 75 1,816 Telephone 61 356 201 721 4,611 Utilities - - - - 153 Rent - - - - 7,445 Postage and courier 88 - 187 53 645 Office supplies - 75 - 165 3,397 Filing and registration fees 193 3,753 333 3,753 4,159 Travel and entertainment - - - - 7,621 Amortization 406 2,047 681 2,787 11,950 Exchange losses - 167 - 1,141 4,335 -------- -------- -------- -------- -------- Total expenses 5,087 10,316 9,046 15,978 114,243 -------- -------- -------- -------- -------- OTHER INCOME Interest earned - - - - 554 Exchange gain - - 10 - 10 -------- -------- -------- -------- -------- Total Other Income - - 10 - 564 -------- -------- -------- -------- -------- LOSS BEFORE INCOME TAXES (5,087) (10,316) (9,036) (15,978) (113,679) INCOME TAXES, NOTE 7 - - - - - -------- -------- -------- -------- -------- LOSS ($5,087) ($10,316) ($9,036) ($15,978) ($113,679) ======== ======== ======== ======== ======== LOSS PER SHARE, NOTE 8 ($0.00) ($0.00) ($0.00) ($0.00) ($0.03 ======== ======== ======== ======== ======== WEIGHTED AVERAGE NUMBER OF SHARES 4,000,000 4,000,000 4,000,000 4,000,000 3,552,700 ======== ======== ======== ======== ========
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eXmailit.com A DEVELOPMENT STAGE COMPANY INTERIM STATEMENT OF CASH FLOWS Unaudited - see the Review Engagement Report -------------------------------------------------------------------------------- FROM INCEPTION, 6 APRIL FOR THE THREE FOR THE SIX 2000 MONTHS ENDED MONTHS ENDED TO -------------------- ------------------ 30 JUNE 30 JUNE 30 JUNE 30 JUNE 30 JUNE 2003 2003 2002 2003 2002 ---------- --------- --------- -------- -------- CASH PROVIDED (USED) FROM OPERATIONS Net loss ($5,087) ($10,316) ($9,036) ($15,978) ($113,679) Items not involving cash Amortization of equipment and software cost 406 2,047 681 2,787 11,950 Office equipment exchanged for consulting services - - - - 15,354 -------- -------- -------- -------- -------- Total cash used for the loss (4,681) (8,269) (8,355) (13,191) (86,375) Changes in working capital other than cash Accounts payable (417) (523) (349) (548) 1,901 Loan payable - - - - 75,000 -------- -------- -------- -------- -------- Total changes in working capital (417) (523) (349) (548) 76,901 -------- -------- -------- -------- -------- Total cash used in operations (5,098) (8,792) (8,704) (13,739) (9,474) -------- -------- -------- -------- -------- CASH PROVIDED (USED) BY INVESTMENT ACTIVITY Acquisition of equipment and software - (2,830) - (2,830) (34,626) -------- -------- -------- -------- -------- CASH PROVIDED (USED) BY FINANCING ACTIVITY Issue of common stock - - - - 53,000 Currency translation adjustment 1,090 2,448 1,948 2,448 3,639 -------- -------- -------- -------- -------- Total cash provided by financing 1,090 2,448 1,948 2,448 56,639 -------- -------- -------- -------- -------- CASH CHANGE (4,008) (9,174) (6,756) (14,121) 12,539 CASH BEGINNING 16,547 41,666 19,295 46,613 - -------- -------- -------- -------- -------- CASH ENDING $ 12,539 $ 32,492 $ 12,539 $ 32,492 $ 12,539 ======== ======== ======== ======== ======== COMPRISED OF: Cash $ 12,539 $ 32,492 $ 12,539 $ 32,492 $ 12,539 ======== ======== ======== ======== ========
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eXmailit.com A DEVELOPMENT STAGE COMPANY INTERIM STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND 2002 AND FROM INCEPTION, 6 APRIL 2000 TO 30 JUNE 2003 Unaudited - See the Review Engagement Report ------------------------------------------------------------------------------- COMMON COMMON ADDITIONAL CURRENCY STOCK STOCK PAID IN TRANSLATION CONSIDERATION ISSUED AMOUNT CAPITAL DEFICIT ADJUSTMENT TOTAL ------------------ -------- -------- --------- --------- ----------- --------- Private placement for cash on 10 April 2000 3,000,000 $ 3,000 $ 0 $ 0 $ 3,000 Net loss from inception, 6 April 2000 to 31 December 2000 ($28,224) (28,224) -------- -------- --------- --------- ----------- --------- Balance as at 31 December 2000 3,000,000 3,000 - (28,224) - (25,224) Private placement for cash on 20 September 2001 1,000,000 1,000 49,000 50,000 Net loss for the year ended 31 December 2001 (46,241) (46,241) --------- --------- --------- --------- ---------- -------- Balance as at 31 December 2001 4,000,000 4,000 49,000 (74,465) - (21,465) --------- --------- --------- --------- ---------- -------- Net loss for the year ended December 31, 2002 (30,178) (30,178) Currenty translation adjustment change for the year ended 31 December 2002 1,691 1,691 --------- --------- --------- --------- ---------- -------- Balance as at 31 December 2002 4,000,000 4,000 49,000 (104,643) 1,691 (49,952) Net loss for the six month ended 30 June 2003 (9,036) (9,036) Currency translation adjustment change for the six months ended 30 June 2003 1,948 1,948 --------- --------- --------- --------- ---------- -------- Balance aa at 30 June 2003 4,000,000 $4,000 $49,000 ($113,679) $3,639 ($57,040) ========= ========= ========= ========== ========= =========
------------------------------------------------------------------------------ Parker & Co., Chartered Accountants 6 eXmailit.com A DEVELOPMENT STAGE COMPANY NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND FROM INCEPTION, 6 APRIL 2000 TO 30 JUNE 2003 Unaudited - see the Review Engagement Report ---------------------------------------------------------------------- Note 1 THE CORPORATION AND ITS BUSINESS eXmailit.com was incorporated in the State of Nevada, United States on 6 April 2000. The company has a total of 100,000,000 authorized shares with a par value of $0.001 per share with 4,000,000 shares issued and outstanding as at 3O June 2003. The company has offices in Vancouver, British Columbia, Canada. The company has been organized to operate an online email to mail service network on the internet. The company is a development stage company which has not derived any revenue from its operations. The fiscal year end of the company is 31 December. Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES These financial statements have been prepared using United States Generally Accepted Accounting Principles as established by the American Institute of Certified Public Accountants and have been stated in United States dollars rounded to the nearest whole dollar except for the loss per share which has been rounded to the nearest cent. These accounting principles are applicable to a going concern, which contemplates the realization and liquidation of liabilities in the normal course of business. Current business activities have just begun and insufficient revenue has been generated to sustain the company as a going concern without the infusion of additional capital. Assets and liabilities of operations in foreign countries are translated into United States dollars using the exchange rate at the statement of financial position date for monetory assets and liabilities or the historical exchange rates for the nonmonetory assets. Accordingly, the company's primary functional currency is the Canadian dollar and as a result the company operates a Canadian dollar bank account which was translated into United States of America dollars at the exchange rate at the statement of financial position date. Transactions made in Canadian dollars or other foreign currencies were translated at the average exchange rates prevailing throughout the year. The effects of exchange rate fluctuations on translating foreign currency assets and liabilities into United States dollars are included in stockholders' equity, while gains and losses resulting from foreign currency transactions are included in operations. Revenue is recorded as a sale at the time the services contracted for have been completed. Costs are recorded at the time an obligation to pay occurs and are expensed at the time the benefit to the company is matched to revenue or, if there is no matching revenue, to the period in which the benefit is realized. Equipment and software are all amortized at 20% on the declining balance. Note 3 EQUIPMENT AND COMPUTER SOFTWARE
ACCUMULATED UNAMORTIZED UNAMORTIZED AT COST AMORTIZATION COST COST 30 JUNE 30 JUNE 30 JUNE 31 DECEMBER COMPRISED OF: 2003 2003 2003 2002 ---------------------------------------------------- Office furniture $1,982 $ 902 $ 1,080 $ 1,174 Computer equipment 2,828 2,147 681 783 Computer software 5,616 2,371 3,245 3,528 Leasehold improvements 4,134 1,818 2,316 2,518 ------ ------ ---------- ---------- $14,560 $7,238 $ 7,322 $ 8,003 ======= ======= ========== ==========
7 eXmailit.com A DEVELOPMENT STAGE COMPANY NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND FROM INCEPTION, 6 APRIL 2000 TO 30 JUNE 2003 Unaudited - see the Review Engagement Report ------------------------------------------------------------------------- Note 4 LOANS PAYABLE The loans payable were repayable on August 12, 2001. Interest at the rate of 15% per annum may be charged after the loans maturity at the option of the holder. If payment is not paid within 30 days of the due date, then liquidation damages equal to 5% of the overdue amount will be added to the balance owing. The interest to 30 June 2003 and the liquidation damages have been waived and the loans repayment terms have been extended indefinitely, with a provision that the notes cannot be demanded. NOTE 5 SHARE CAPITAL The authorized share capital is 100,000,000 shares with a par value of $0.001. 4,000,000 common share have been issued as follows:
Private placement for cash 10 April 2000 3,000,000 $3,000 $ 0 $ 3,000 Private placement for cash 20 September 2001 1,000,000 1,000 49,000 50,000 --------- ------ ------ ------- Balance as at 30 June 2003 4,000,000 $4,000 $49,000 $53,000 ========= ====== ======= =======
Note 6 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS On 12 August 2000, Robert Gardner, an officer and director, loaned the company $75,000, repayable on 12 August 2001 at an interest rate of 15% per annum, at the option of the holder. The terms of the loan payable provide that if payment is not made within 30 days of the due date, then liquidation damages equal to 5% of the overdue amount will be added to the balance owing. The interest to and including 30 September 2002 and the liquidation damages have been waived by Mr. Gardner and the loan repayment has been extended indefinitely, with a provision that the note cannot be demanded. The company is currently using the business offices of Robert Gardner, an officer and director, at 999 West Hastings Street, Suite 530, Vancouver, B.C. Canada, on a rent-free basis. There is no written lease agreement or other material terms or arrangements relating to the company's agreement with Mr. Gardner to use his office space. The premises consist of approximately 1000 square feet, including office space, reception area and meeting facilities. 8 eXmailit.com A DEVELOPMENT STAGE COMPANY NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND FROM INCEPTION, 6 APRIL 2000 TO 30 JUNE 2003 Unaudited - see the Review Engagement Report --------------------------------------------------------------------- Note 6 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS (CONTINUED) The officers and directors of the company are involved in other business activities, and may, in the future become active in additional other business activities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the company and their own business interests. The company has not formulated a policy for the resolution of such a conflict. Note 7 INCOME TAXES Income taxes on the loss has not been reflected in these financial statements as it is not virtually certain that this loss will be recovered before the expiry period of the loss carry forwards. Note 8 Loss Per Share Basic loss per share is computed by dividing losses available to common stockholders by the weighted average number of common shares during the period. Diluted loss per share is calculated on the weighted average number of common shares that would have resulted if dilutive common stock equivalents had been converted to common stock. No stock options or similar rights were available or granted during the period presented. Accordingly, basic and diluted loss per share are the same. 9 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K A) The following exhibits marked with an asterisk and required to be filed herein are incorporated by reference to Registrant's Form 10SB, filed with the Commission on April 26, 2002, which can be found on the SEC website at www.sec.gov under SEC File Number 0-49763: Exhibit No. Description ----------- ----------- * 3(i) Articles of Incorporation * 3(ii) Bylaws 99 Sec. 906 Officer Certifications B) There were no reports on Form 8-K filed during the quarter. 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. eXmailit.com ------------------------ Dated: August 10, 2003 By:/s/ M. Kevin Ryan, President,CEO, Secretary and Director Dated: August 10, 2003 By:/s/ Robert Gardner, Treasurer, CFO and Director CERTIFICATION of CHIEF EXECUTIVE OFFICER ---------------------------------------- I, M. Kevin Ryan, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of eXmailit. com. 2. Based on my knowledge, this quarterly 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 quarterly report. 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of eXmailit.com as of, and for, the periods presented in this quarterly report. 10 4. eXmailit.com'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 eXmailit.com and have: (a) designed such disclosure controls and procedures to ensure that material information relating to eXmailit.com, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; (b) evaluated the effectiveness of eXmailit.com's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and (c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The other certifying officers and I have disclosed, based on our most recent evaluation, to our auditors and the audit committee of our Board of Directors (or persons performing the equivalent functions): (a) that there were no deficiencies in the design or operation of internal controls which could adversely affect our ability to record, process, summarize and report financial data and have identified for our auditors any material weaknesses in internal controls; and (b) there was no fraud, whether or not material, that involves management or other employees who have a significant role in our internal controls. 6. The other certifying officers certify that there were no significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. August 10, 2003 /s/ M. Kevin Ryan ------------------------------------------ By: M. Kevin Ryan, Chief Executive Officer and Chairman of the Board of Directors 11 CERTIFICATION of CHIEF FINANCIAL OFFICER ---------------------------------------- I, Robert Gardner, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of eXmailit. com. 2. Based on my knowledge, this quarterly 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 quarterly report. 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of eXmailit.com as of, and for, the periods presented in this quarterly report. 4. eXmailit.com'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 eXmailit.com and have: (a) designed such disclosure controls and procedures to ensure that material information relating to eXmailit.com, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; (b) evaluated the effectiveness of eXmailit.com's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and (c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The other certifying officers and I have disclosed, based on our most recent evaluation, to our auditors and the audit committee of our Board of Directors (or persons performing the equivalent functions): 12 (a) that there are no deficiencies in the design or operation of internal controls which could adversely affect our ability to record, process, summarize and report financial data and have identified for our auditors any material weaknesses in internal controls; and (b) there was no fraud, whether or not material, that involves management or other employees who have a significant role in our internal controls. 6. The other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. August 10, 2003 /s/ Robert Gardner -------------------------------------------- By: Robert Gardner, Chief Financial Officer and Director 13