-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O61+YZnBL7Eo1Us0ezYDfPBasHpZlV1ADQ9QrEh45DdCx4Y6Aqc0/B4nza3xfsPv /i1/jTq0QNR/AhY8zW6GLQ== 0000950149-01-501815.txt : 20020410 0000950149-01-501815.hdr.sgml : 20020410 ACCESSION NUMBER: 0000950149-01-501815 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROGRESSIVE ASSET MANAGEMENT INC CENTRAL INDEX KEY: 0000862801 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 943048535 STATE OF INCORPORATION: CA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-29731 FILM NUMBER: 1790889 BUSINESS ADDRESS: STREET 1: 1814 FRANKLIN STREET STREET 2: SUITE 700 CITY: OAKLAND STATE: CA ZIP: 94612 BUSINESS PHONE: 5108343722 MAIL ADDRESS: STREET 1: 1814 FRANKLIN STREET STREET 2: SUITE 700 CITY: OAKLAND STATE: CA ZIP: 94612 10QSB 1 f77204e10qsb.txt QUARTER REPORT - SMALL BUSINESS UNITED STATES 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 September 30, 2001 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from _______ to __________ Commission file number _________________________ PROGRESSIVE ASSET MANAGEMENT, INC. (Exact name of small business issuer as specified in its charter) CALIFORNIA 90-804853 (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 1010 Oak Grove Road, Concord, CA 94518 ---------------------------------------- (Address of principal executive offices) 800-786-2998 -------------- (Issuer's telephone number) --------------------------------------------------- Former name, former address and former fiscal year, if changed since last report) APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the registrant filed all documents and reports required to be filed by Section l2, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes [ ] 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: 1,406,654 shares of Common Stock as of October 31, 2001. Transitional Small Business Disclosure Format (Check one): Yes [X] No [ ] 1 PART I-FINANCIAL INFORMATION Item 1. Financial Statements. PROGRESSIVE ASSET MANAGEMENT, INC. Condensed Consolidated Statement of Operations
Three months ended Three months ended September 30, September 30 2001 2000 ---- ---- Total revenues ............................ $ 122,790 $ 140,558 Costs and expenses Employee compensation and benefits 55,922 61,663 Other costs and expenses ......... 46,106 39,720 ---------- ---------- Total costs and expenses ......... 102,028 101,383 ---------- ---------- Income before income taxes ................ 20,762 39,175 Taxes on income ........................... 0 0 ---------- ---------- Net income (loss) ......................... $ 20,762 $ 39,175 ========== ========== Net income (loss) per share Basic ............................ $ 0.01 $ 0.02 ========== ========== Fully diluted .................... $ 0.01 $ 0.01 ========== ========== Shares used to compute per share amounts Basic ............................ 1,537,667 1,600,620 ========== ========== Fully diluted .................... 2,711,986 2,774,939 ========== ==========
2 PROGRESSIVE ASSET MANAGEMENT, INC. Condensed Consolidated Statement of Cash Flows
Three months ended Three months ended September 30, September 30, 2001 2000 ---- ---- Cash flows from operating activities Net income (loss) ........................ $ 20,762 $ 39,175 Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities ............................... 31,213 (8,133) --------- --------- Net cash provided (used) by operating activities ............................... 51,975 31,042 Net cash provided (used) by investing activities ........................................ (2,493) 0 Net cash provided (used) by financing activities ........................................ (69,612) 0 --------- --------- Net change in cash and cash equivalents ........... (20,130) 31,042 Cash and cash equivalents, Beginning of period ............................... 479,383 506,125 --------- --------- End of period ..................................... $ 459,253 $ 537,167 ========= =========
3 PROGRESSIVE ASSET MANAGEMENT, INC. Condensed Consolidated Statement of Financial Condition
September 30, September 30, 2001 2000 ---- ---- Assets Current assets Cash and cash equivalents .............. $ 459,253 $ 537,167 Commissions and other receivables ...... 31,748 67,570 Other current assets ................... 124,156 25,538 ----------- ----------- Total current assets ................... 615,157 630,275 Property and equipment, net ..................... 12,152 14,729 Other assets .................................... 43,479 22,128 ----------- ----------- Total assets .................................... $ 670,788 $ 667,132 =========== =========== Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued liabilities $ 33,104 $ 44,744 ----------- ----------- Total current liabilities .............. 33,104 44,744 Other liabilities ............................... 33,849 78,084 Preferred stock, Series A ....................... 55,069 59,160 Stockholders' equity Preferred stock, Series B .............. 25,000 25,000 Common stock, no par value ............. 1,392,800 1,468,657 Retained earnings (accumulated deficit) (869,034) (1,008,503) ----------- ----------- Total stockholders' equity ............. 548,766 485,154 ----------- ----------- Total liabilities and stockholders' equity ...... $ 670,788 $ 667,132 =========== ===========
4 Item 2. Management's Discussion and Analysis or Plan of Operation. Results of Second Quarter. The results of PAM's Second Quarter is described in the "REPORT TO SHAREHOLDERS" dated November 14, 2001. A copy is included as Exhibit 19 to this Form 10-QSB and is incorporated by reference as part of this Item 2. Forward-Looking Statements. Any statements contained in this Quarterly Report that relate to future plans, events, or performance are forward-looking statements that involve risks and uncertainties. These include: but are not limited to, changes in general economic conditions, particularly the recent down-turn in the economy, the war on terrorism, intense competition for customers, pressures on brokerage, other fees charged, most notably the competition among firms offering brokerage services on-line, the mood of the investing public and the changes in political attitude toward socially responsible investments. PAM cautions that the foregoing list of important factors is not exclusive. Developments in any of these areas could cause PAM's results to differ materially from results that have been or may be projected by or on behalf of PAM. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this statement. PAM does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of PAM. PART II-OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits required by Item 601 of Regulation S-B. Exhibit 2 (a) Restated Articles of Incorporation(1) (b) Bylaws(1) Exhibit 6 (a) Stock Option Plan(1) (b) Standstill and Restrictions on Transfer Agreement Between and among Progressive Asset Management, Paradox Holdings Inc., and Financial West Group(1) (c) Agreement between PAM and Sustainable Systems, Inc.(2) Exhibit 12 (a) Purchase Agreement Among Paradox Holdings, PAM and FWG(1) Exhibit 19 Report to Shareholders, dated November 14, 2001
Footnotes: (1) Incorporated by reference to the Company's Registration Statement on Form 10-SB, Amendment 2, filed August 9, 2000. (2) Incorporated by reference to the Company's Form 10-KSB, filed on September 28, 2000. (b) Reports on Form 8-K. No Forms 8-K were filed during the quarter for which this report is filed, listing the items reported, any financial statements filed and the dates of such reports. 5 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. PROGRESSIVE ASSET MANAGEMENT, INC. Date: November 14, 2001 /s/ ------------------------------- Eric Leenson, President and Chief Executive Officer Date: November 14, 2001 /s/ ------------------------------- Catherine Cartier, Secretary 6 EX-19 3 f77204ex19.txt EXHIBIT 19 [Progressive Asset Management, Inc. letterhead] EXHIBIT 19 REPORT TO SHAREHOLDERS QUARTER ENDING SEPTEMBER 30, 2001 I. FINANCES. During the quarter ending September 30, 2001, Progressive Asset Management, Inc. (PAM) again achieved positive financial results. PAM produced total revenues of $122,790, while incurring expenses of $102,028, thereby generating a net profit of $20,762 for the quarter. Earnings for the quarter were $0.01 cent per share (fully diluted also $ 0.01 cent per share). Net profits do reflect a decline of $ 18,413 from the same quarter of the previous year. Such a decline is attributable to a fall in gross revenues, since expenses remained nearly identical between the quarters. This drop in revenue was caused by 1) a decrease in commissions and asset-based fees associated with a turbulent equities environment, and 2) a reduction in the percentage of broker-generated revenues received by PAM because registered representatives who are part of the PAM Network received an increase in pay out. Each PAM shareholder receives as part of this Quarterly Report, the unaudited financial statement for the quarter ending September 30, 2001, prepared by Markle Stuckey Hardesty & Bott. As we have discussed in past reports, under the strategic alliance with Financial West Group (FWG), FWG executes securities transactions and receives the commissions for those transactions generated by registered representatives who are members of the PAM Network. FWG then distributes the preponderance of the commissions to the registered representatives, retaining a portion, which is shared with PAM. In the past year, PAM increased the amount paid out to the registered representatives (thereby decreasing the amount received by PAM). PAM believes that this step was necessary to reward the exemplary efforts of the PAM Network registered representatives to increase productivity and encourage their continued participation in the PAM Network, as well as making the PAM Network as attractive as possible to potential recruits. II. IMPLEMENTATION OF PAM'S BUSINESS PLAN. Critical aspects of building PAM involve adding more registered representatives to the Network and increasing the productivity of existing ones. To pursue these goals, PAM established the position of Director of Business Development that Alison Wise filled in August. Despite the fact that her first few weeks were spent successfully studying for and passing her broker's licensing exams, it is already apparent that staff capacity for recruitment and broker-coordination has improved markedly. Ms. Wise holds an MBA from the University of Oregon, where she was also a co-director of the 1999 Annual Sustainable Business Symposium. She has been involved with social and environmental business for the past ten years. In addition, a new advertising initiative was undertaken with PAM's first-time ever purchase of a full-page ad and tear-off postcard in Coop America's widely circulated Green Pages, a directory of "green" businesses for consumers interested in shopping in a socially responsible manner. During the quarter, work continued on Progressive Trade Securities (PTS), a new company created by PAM and Sustainable Systems, Inc., to offer socially responsible investing to on-line investors. Recently, PTS negotiated a favorable Memorandum of Understanding with a provider of on-line trading and back- 7 office brokerage services. Based on this development PTS is in conversation with potential investors. However, no launch date can be set until sufficient capital is raised, and the uncertain status of the markets today makes it very difficult to predict when, or even if, such funds will become available. III. SHAREHOLDER MATTERS. PAM's Board believes that the repurchase of PAM common shares is one of the best ways to increase shareholder value, by reducing the number of outstanding shares. The company has maintained a buy-back program since establishing the strategic alliance with FWG. Since July 1999 PAM has repurchased 223,472 shares of common stock. During the quarter ended September 30, 2001, 50,450 shares, approximately 3.5% of outstanding common shares, were purchased. Given the financial success of PAM's operations over the past two years and its healthy balance sheet, the Board has decided to accelerate the buy back program by initiating a tender offer for 250,000 shares of common stock. You will soon receive documents outlining the details of the offer, if you have not already. During the tender offer, PAM will not be buying back any stock on the open market. PAM continues to file quarterly and annual reports and other special reports as required with the SEC. PAM filed a Schedule TO with the SEC detailing the terms of the tender offer. The Schedule TO, as well as the quarterly and annual reports, are available online from the SEC. IV. LOOKING TO THE FUTURE. The quarter ending September 30, 2001 was the 8th consecutive quarter of profitability for PAM under the new strategic alliance with Financial West Group. Such consistency appears to demonstrate the viability of our business model, at least on the scale that PAM presently operates. We believe that actions taken during this period have enhanced PAM's ability to grow and to increase shareholder value. However, the world has changed since September 11th. Given current trends, revenues are likely to decline. The unprecedented degree of uncertainty that grips the world today profoundly challenges our ability to foresee what will happen in the financial markets, and consequently what will be the fate of companies, large and small. For fourteen years we have sought to offer our clients the opportunity to invest for financial return and social progress. The importance of our mission has never been greater, nor our conviction about its relevance stronger. Thank you for your continuing support of our efforts. We appreciate the strength of PAM's stakeholders in these turbulent and troubling times. Peter Camejo Eric Leenson /s/ /s/ Board Chair President, CEO November 14, 2001
Forward-Looking Statements. Any statements contained in this Report that relate to future plans, events, or performance are forward-looking statements that involve risks and uncertainties. These include, but are not limited to, changes in general economic conditions, particularly the recent down-turn in the economy, the war against terrorism, intense competition for customers, pressures on brokerage, other fees charged, most notably the competition among firms offering brokerage services on-line, the mood of the investing public and the changes in political attitude toward socially responsible investments. The terrible attack on September 11, 2001, on targets in the United States created even greater uncertainty and insecurity. PAM cautions that the foregoing list of important factors is not exclusive. Developments in any of these areas could cause PAM's results to differ materially from results that have been or may be projected by or on behalf of PAM. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this statement. PAM does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of PAM. 8 -----END PRIVACY-ENHANCED MESSAGE-----