Post by same53 on May 21, 2007 20:40:07 GMT -5
10Q is in
RESULTS OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2007
For the three month period ended March 31, 2007, the Company earned revenues of $ 1,451,274. The revenues were from sales of airtime related to telephone calling cards.
During the three month period ended March 31, 2007, the Company incurred operational expenses of $816,465. These operating expenses included: consulting fees of $119,887, wages and benefits of $189,975, and professional fees of $190,195 for the three month period ending March 31, 2007.
During the three month period ended March 31, 2007, the Company incurred a net loss from operations of $521,673.
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2007, COMPARED TO THE THREE MONTH PERIOD ENDED MARCH 31, 2006.
For the three month period ended March 31, 2007, the Company earned revenues of $1,451,274 as compared to revenues of $1,872,999 for the same period ended March 31, 2006. The changes in revenues in 2007 are a result of the Company’s continued efforts to restructure its business and product offerings.
For the three month period ended March 31, 2007, the Company incurred operational expenses of $816,465 as compared to $1,393,864 during the same period in the previous year. These operating expenses included: consulting fees of $119,887 and $147,934, wages & benefits of $189,975 and $173,727, and professional fees of $190,195 and $131,470 for the three month period ended March 31, 2007 and 2006, respectively. The variation in expenses from March 31, 2007 as compared to the same period in the previous year is due to the continued efforts to restructure its business operations and reduction of debt.
The Company incurred a net loss from operations of $521,673 for the fiscal quarter ended March 31, 2007, as compared to $1,015,147 for the same period in the previous year.
SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies have been outlined in our 10KSB filing for the year ending September 30, 2006, and are thus incorporated by reference. We have had no significant changes to our accounting policies or assumptions in the three month period ending March 31, 2007.
Liquidity and Financial Condition As Of March 31, 2007
We had cash-on hand totaling $ 72,459 as of March 31, 2007.
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We believe that our currently available working capital provided by operating activities may be insufficient to meet our operations at our current level and working capital and capital expenditure needs over the next 12 months. Our future capital requirements will depend on many factors, including our rate of revenue growth, the expansion of our marketing and sales activities, the timing and extent of spending to support product development efforts and expansion into new territories, the timing of introductions of new products or services, the timing of enhancements to existing products and services and the timing of capital expenditures. Also, we may make investments in, or acquisitions of, complementary businesses, services or technologies which could also require us to seek additional equity or debt financing. To the extent that available funds are insufficient to fund our future activities, we may need to raise additional funds through public or private equity or debt financing. Additional funds may not be available on terms favorable to us or at all.
Management plans on initiating a series of securities offerings to raise the investment capital needed to meet our acquisition and development plans. Paivis hopes to secure the financing to satisfy the capital needs through the execution of various funding methods, primarily financing through, private placement investments or debt financing. Paivis hopes to achieve this by securing relationships with accredited individual investors, investment bankers, venture capitalists, hedge funds and/or finance investment advisors that have the experience and relationships to aid Paivis with its capital raising efforts. The source of the capital may be comprised of a mix of principal shareholders, private investors and venture capital companies.
If needed capital investment for our acquisitions or developments is not available, in whole or in part, we intend to delay the implementation plan regarding our acquisitions or development plans until sufficient investment capital becomes available. We cannot give any assurances that we will raise sufficient investment capital to meet the business plan. In addition to delays to the implementation plan regarding our acquisition or development plans due to insufficiency of investment capital, we may suffer other consequences, including but not limited to the following: We may have to significantly alter the scope of our business plan and subsequent capital requirements; We may have to suspend or discontinue operations of one or more of our business units or; we may have to suspend or discontinue operations of the Company if we become insolvent as a result.
Until planned acquisitions and operating activities begin to produce significant revenues and subsequent positive cash flow, we will be reliant on capital received from private placements, loans, and the exercise of options and warrants.
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OFF-BALANCE SHEET ARRANGEMENTS
The Company does not have any off-balance sheet arrangements that are likely to have a current or future effect on the Company's financial condition, revenues or expenses, results of operations or capital resources.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
ITEM 4. CONTROLS AND PROCEDURES.
As of the end of the period covered by this report the Company conducted an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon this evaluation, the Company's principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is: (1) accumulated and communicated to the Company's management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure; and (2) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms. There was no change in the Company's internal controls or in other factors that could affect these controls during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's s internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
On February 15, 2007, the Registrant filed a lawsuit in Arapahoe County District Court, Colorado, against John J. Donnelly and Executive Transfer & Registrar Inc. (“Executive Registrar”), the Registrant’s former stock transfer agent. We requested the court to issue a temporary restraining order and grant a preliminary injunction to compel Executive Registrar and Mr. Donnelly to transfer all of our stock books and records to our newly appointed stock transfer agent, Corporate Stock Transfer, Inc., as required by rules and procedures mandated by the U.S. Securities and Exchange Commission, and to compel Executive Registrar to file it’s termination notice with the Depository Trust Company as required by the U.S. Securities and Exchange Commission.
On February 20, 2007, the court approved a consent order entered into between the Registrant and Executive Transfer that compels Executive Transfer to immediately cease and desist issuing any shares of our common stock, and within 10 days, deliver a certified shareholders’ list to Corporate Stock Transfer, Inc. and also to formally notify Depository Trust Company in writing of the termination of Executive Registrar as our stock transfer agent.
During the period covered by this report, the Registrant’s subsidiary, Macro Communications, Inc. (“Macro”) was notified of the commencement of garnishment proceedings supplemental to the Final Judgment entered on March 5, 2007, in the lawsuit previously filed against Macro by iBasis, Inc., in the Superior Court—Gwinnett County, Georgia, File No.: 06-A-09136-8. A Summons of Garnishment was issued by that same court on April 2, 2007 asserting that Macro was indebted to iBasis, Inc. in the sum of $320,851.72 at that date. The Registrant does not contest the validity of the underlying Final Judgment that was entered in favor of iBasis, Inc.
RESULTS OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2007
For the three month period ended March 31, 2007, the Company earned revenues of $ 1,451,274. The revenues were from sales of airtime related to telephone calling cards.
During the three month period ended March 31, 2007, the Company incurred operational expenses of $816,465. These operating expenses included: consulting fees of $119,887, wages and benefits of $189,975, and professional fees of $190,195 for the three month period ending March 31, 2007.
During the three month period ended March 31, 2007, the Company incurred a net loss from operations of $521,673.
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2007, COMPARED TO THE THREE MONTH PERIOD ENDED MARCH 31, 2006.
For the three month period ended March 31, 2007, the Company earned revenues of $1,451,274 as compared to revenues of $1,872,999 for the same period ended March 31, 2006. The changes in revenues in 2007 are a result of the Company’s continued efforts to restructure its business and product offerings.
For the three month period ended March 31, 2007, the Company incurred operational expenses of $816,465 as compared to $1,393,864 during the same period in the previous year. These operating expenses included: consulting fees of $119,887 and $147,934, wages & benefits of $189,975 and $173,727, and professional fees of $190,195 and $131,470 for the three month period ended March 31, 2007 and 2006, respectively. The variation in expenses from March 31, 2007 as compared to the same period in the previous year is due to the continued efforts to restructure its business operations and reduction of debt.
The Company incurred a net loss from operations of $521,673 for the fiscal quarter ended March 31, 2007, as compared to $1,015,147 for the same period in the previous year.
SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies have been outlined in our 10KSB filing for the year ending September 30, 2006, and are thus incorporated by reference. We have had no significant changes to our accounting policies or assumptions in the three month period ending March 31, 2007.
Liquidity and Financial Condition As Of March 31, 2007
We had cash-on hand totaling $ 72,459 as of March 31, 2007.
-14-
We believe that our currently available working capital provided by operating activities may be insufficient to meet our operations at our current level and working capital and capital expenditure needs over the next 12 months. Our future capital requirements will depend on many factors, including our rate of revenue growth, the expansion of our marketing and sales activities, the timing and extent of spending to support product development efforts and expansion into new territories, the timing of introductions of new products or services, the timing of enhancements to existing products and services and the timing of capital expenditures. Also, we may make investments in, or acquisitions of, complementary businesses, services or technologies which could also require us to seek additional equity or debt financing. To the extent that available funds are insufficient to fund our future activities, we may need to raise additional funds through public or private equity or debt financing. Additional funds may not be available on terms favorable to us or at all.
Management plans on initiating a series of securities offerings to raise the investment capital needed to meet our acquisition and development plans. Paivis hopes to secure the financing to satisfy the capital needs through the execution of various funding methods, primarily financing through, private placement investments or debt financing. Paivis hopes to achieve this by securing relationships with accredited individual investors, investment bankers, venture capitalists, hedge funds and/or finance investment advisors that have the experience and relationships to aid Paivis with its capital raising efforts. The source of the capital may be comprised of a mix of principal shareholders, private investors and venture capital companies.
If needed capital investment for our acquisitions or developments is not available, in whole or in part, we intend to delay the implementation plan regarding our acquisitions or development plans until sufficient investment capital becomes available. We cannot give any assurances that we will raise sufficient investment capital to meet the business plan. In addition to delays to the implementation plan regarding our acquisition or development plans due to insufficiency of investment capital, we may suffer other consequences, including but not limited to the following: We may have to significantly alter the scope of our business plan and subsequent capital requirements; We may have to suspend or discontinue operations of one or more of our business units or; we may have to suspend or discontinue operations of the Company if we become insolvent as a result.
Until planned acquisitions and operating activities begin to produce significant revenues and subsequent positive cash flow, we will be reliant on capital received from private placements, loans, and the exercise of options and warrants.
-15-
OFF-BALANCE SHEET ARRANGEMENTS
The Company does not have any off-balance sheet arrangements that are likely to have a current or future effect on the Company's financial condition, revenues or expenses, results of operations or capital resources.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
ITEM 4. CONTROLS AND PROCEDURES.
As of the end of the period covered by this report the Company conducted an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon this evaluation, the Company's principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is: (1) accumulated and communicated to the Company's management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure; and (2) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms. There was no change in the Company's internal controls or in other factors that could affect these controls during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's s internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
On February 15, 2007, the Registrant filed a lawsuit in Arapahoe County District Court, Colorado, against John J. Donnelly and Executive Transfer & Registrar Inc. (“Executive Registrar”), the Registrant’s former stock transfer agent. We requested the court to issue a temporary restraining order and grant a preliminary injunction to compel Executive Registrar and Mr. Donnelly to transfer all of our stock books and records to our newly appointed stock transfer agent, Corporate Stock Transfer, Inc., as required by rules and procedures mandated by the U.S. Securities and Exchange Commission, and to compel Executive Registrar to file it’s termination notice with the Depository Trust Company as required by the U.S. Securities and Exchange Commission.
On February 20, 2007, the court approved a consent order entered into between the Registrant and Executive Transfer that compels Executive Transfer to immediately cease and desist issuing any shares of our common stock, and within 10 days, deliver a certified shareholders’ list to Corporate Stock Transfer, Inc. and also to formally notify Depository Trust Company in writing of the termination of Executive Registrar as our stock transfer agent.
During the period covered by this report, the Registrant’s subsidiary, Macro Communications, Inc. (“Macro”) was notified of the commencement of garnishment proceedings supplemental to the Final Judgment entered on March 5, 2007, in the lawsuit previously filed against Macro by iBasis, Inc., in the Superior Court—Gwinnett County, Georgia, File No.: 06-A-09136-8. A Summons of Garnishment was issued by that same court on April 2, 2007 asserting that Macro was indebted to iBasis, Inc. in the sum of $320,851.72 at that date. The Registrant does not contest the validity of the underlying Final Judgment that was entered in favor of iBasis, Inc.