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 March 31, 2004
[ ] 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.
---------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 22-2497491
--------------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1800 Bloomsbury Avenue, Ocean, NJ 07712
---------------------------------------
(Address of principal executive offices)
732-922-3355
-------------------------
(Issuer's telephone number)
--------------------------------------------------
(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 April 15, 2004.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements of Buy It Cheap.com, Inc.
Balance Sheet as of March 31, 2004 and June 30, 2003.
Statements of Loss (unaudited) for the three and nine month
periods ended March 31, 2004 and 2003 and for the period
July 19, 1999 and March 31, 2004.
Statements of Cash Flows (unaudited) for the nine months
ended March 31, 2004 and 2003 and for the period July 19,
1999 to March 31, 2004.
Notes to Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Balance Sheets
As of
March 31, 2004 June 30, 2003
------------------------------
(Unaudited)
Assets
Current assets:
Cash $ 148 $ 563
Other current assets 1,000 1,000
-------- --------
Total current assets 1,148 1,563
-------- --------
Property and equipment, net of
depreciation 891 1,781
-------- --------
Total assets $ 2,039 $ 3,344
======== ========
Liabilities and Equity
Current liabilities:
Accounts payable $ 161,097 $ 153,944
Due to officers and directors 5,559 5,559
Convertible note payable 16,198 16,198
Deposit 29,500 20,000
-------- --------
Total current liabilities 212,354 195,701
-------- --------
Total liabilities 212,354 195,701
-------- --------
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 (255,555) (237,597)
-------- --------
Total stockholders' equity (210,315) (192,357)
-------- --------
Total Liabilities and Equity $ 2,039 $ 3,344
======== ========
See Notes to the Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Loss
(unaudited)
For the For the Cumulative
three months ended nine months ended for the period
March 31, March 31, July 19, 1999
2004 2003 2004 2003 to Mar. 31, 2004
-----------------------------------------------------------------------------------
Sales Revenues $ - $ - $ - $ - $ -
--------------------------------------------------------
Direct operating costs - 1,035 1,113 2,201 24,499
General and administrative
expenses 9,084 4,574 16,845 19,421 231,056
--------------------------------------------------------
Total expenses 9,084 5,609 17,958 21,622 255,555
--------------------------------------------------------
Net loss $ (9,084) $ (5,609) $ (17,958) $ (21,622) $ (255,555)
========================================================
Weighted average number
of shares Outstanding 9,040,582 9,040,582 9,040,582 9,040,582
============================================
Net loss per share $ - $ - $ - $ -
==========================================
See Notes to Financial Statements
BUY IT CHEAP.COM, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
Cumulative
from July 19,
For the nine months ended 1999 to
March 31, March 31,
2004 2003 2004
----------------------------------------
Cash flows from operating activities:-
Net loss $ (17,958) $ (21,622) $ (255,555)
Adjustments to reconcile net loss
to net cash used by operating
activities:
Depreciation and amortization 890 6,280 37,386
Changes in assets and liabilities
Other current assets - - (1,000)
Accounts payable 7,153 (6,387) 26,165
-------- -------- ---------
Net cash used by operating
activities (9,915) (21,729) (193,004)
-------- -------- ---------
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
Deposit received 9,500 20,000 29,500
-------- -------- ---------
9,500 20,000 214,500
-------- -------- ---------
Net increase (decrease) in cash (415) (1,729) 148
Cash at beginning of period 563 6,371 -
-------- -------- ---------
Cash at end of period $ 148 $ 4,642 $ 148
======== ======== =========
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 and
nine month periods ended March 31, 2004 and 2003 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 and nine month periods ended March
31, 2004 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 and nine month
periods March 31, 2004 and 2003. 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
As of March 31, 2004, a stockholder has made $29,500 of advances to the
Company. The Company has characterized these advances as deposits received
against the future sale of some of the Company's assets.
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
acquistion 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 commence an Internet retailing operation under the website
"Buyitcheap.com." The Company, however, has been unable to arrange settlement
of its liabilities and raise substantial new investment capital needed to
effectively develop this business. Additionally, the Company has recently
had difficulty raising the small amount of capital necessary to remain a
viable entity.
Recently, the Company has received several inquiries from companies
desiring to merge into (a reverse merger) the Company to take advantage of
its publicly held status. In light of its current financial situation the
Company has decided that it would be in the best interest of shareholders to
seek an acceptable merger partner. After evaluating several inquiries, the
Company on April 13, 2004 entered into a Share Exchange Agreement with the
shareholders of Cashtech Investment Limited, a British Virgin Islands
corporation. Cashtech Investment Limited is a holding company which owns
70% of the outstanding capital stock of Harbin Zhongqiang Power-Tech Co.,
Inc., a China limited liability company ("ZQ Power-Tech").
ZQ Power-Tech owns a factory near Harbin, China where it designs and
manufactures rechargeable polymer lithium-ion batteries. ZQ Power-Tech's
batteries are used in consumer products such portable computers, personal
digital assistants and cellular telephones. ZQ Power-Tech also manufactures
larger batteries for use in motor scooters as well as encased batteries for
miners' lamps. ZQ Power-Tech was founded in August 2002 and had only
nominal sales during 2003. Currently, however, ZQ Power-Tech has a backlog
of orders for delivery in 2004 exceeding U.S. $4.5 million.
Closing of the acquisition is expected to take place in May, after filings
with the Securities and Exchange Commission and the State of Delaware are
made, an information statement is mailed to the shareholders of Buy It
Cheap.com, and the parties complete their due diligence. At the closing Buy
It Cheap.com will acquire all of the outstanding capital stock of Cashtech
Investment Limited, and will issue Buy It Cheap.com common stock and
preferred stock that will give the current owners of Cashtech Investment
Limited ownership of 91% of the equity in Buy It Cheap.com, Inc.
A Current Report on Form 8-K containing information regarding Cashtech
Investment Limited and ZQ Power-Tech will be filed promptly after the
closing of the acquisition.
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 March 31, 2004. 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
March 31, 2004
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.
Date: May 5, 2004 /s/ Stephen E. Roman, Jr.
----------------------------
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: May 5, 2004 /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: May 5, 2004 /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.
May 5, 2004 /s/ Anthony J. Consi
-----------------------------
Anthony J. Consi
(Chief executive officer)
/s/ Stephen E. Roman, Jr.
-----------------------------
Stephen E. Roman, Jr.
(Chief financial officer)