AMENDMENT 5 to
FORM 10-KSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] 15,ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: 10/31/00
OR
[ ]15,TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number - 333-44882
Great Expectations, Inc.
Exact name of Registrant as specified in its charter)
Colorado 84-1521955
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
501 South Cherry Street, Suite 610, Denver, Colorado 80246
(Address of principal executive offices) (Zip Code)
(303) 320-0066
(Address and telephone number of registrant's principal executive
offices and principal place of business.)
Securities registered pursuant to
Section 12(b) of the Act: None
Securities registered pursuant to
Section 12(g) of the Act: Common Stock, $.001 par value
Check whether the Company (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act during the
preceding 12 months (or such shorter period that the Company was
required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days.
Yes __x__ No _____
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no
disclosure will be contained, to the best of Company's knowledge, in
definitive proxy or information statements incorporated by reference
in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.
[ x ]
The Company's revenues for its most recent fiscal year were $0.00. As
of October 31, 2000 the market value of the Company's voting $.00l par
value common stock held by non-affiliates of the Company was $0.00.
The number of shares outstanding of Company's only class of common
stock, as of October 31, 2000 was 150,520,000 shares of its common
stock. Check whether the Issuer has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act
after the distribution of securities under a plan confirmed by a
court.
Yes __x__ No _____
No documents are incorporated into the text by reference.
Transitional Small Business Disclosure Format (check one)
Yes No x
-------- --------
2
PART I
ITEM 1. BUSINESS
Great Expectations was incorporated under the laws of the State of
Colorado on June 5, 1987 as Great Expectations, Inc. Great
Expectations was administratively dissolved on January 1, 1997 under
the Colorado Corporation Code for failure to file two biannual
reports. We filed for reinstatement on June 18, 1998, filed the past
due biannual reports, paid all fees and penalties and were reinstated
on that date as a corporation in good standing. Great Expectations
was required to change its name to Great Expectations and Associates,
Inc. based on the unavailability of its prior name.
Since 1987, Great Expectations has performed only those administrative
functions necessary in further pursuance of this offering. Great
Expectations is in the early developmental and promotional stages. To
date Great Expectation's only activities have been organizational
ones, directed at developing its business plan and raising its initial
capital. We have not generated any revenues.
Great Expectations has not commenced any commercial operations. Great
Expectations has no employees and owns no real estate. We do not
intend to perform any operations until a merger or acquisition
candidate is locates and a merger or acquisition consummated. Great
Expectations can be defined as a "shell" company whose sole purpose at
this time is to locate and consummate a merger or acquisition with a
private entity.
Another aspect of our business plan that Great Expectations intends to
implement after this registration statement becomes effective, is to
seek to facilitate the eventual creation of a public trading market in
its outstanding securities. Great Expectation's business plan is to
seek, investigate, and, if warranted, acquire one or more properties
or businesses, and to pursue other related activities intended to
enhance shareholder value.
The acquisition of a business opportunity may be made by purchase,
merger, exchange of stock, or otherwise, and may encompass assets or a
business entity, such as a corporation, joint venture, or partnership.
Great Expectations has very limited capital, and it is unlikely that
Great Expectations will be able to take advantage of more than one
such business opportunity.
Great Expectations intends to seek opportunities demonstrating the
potential of long-term growth as opposed to short-term earnings. At
the present time Great Expectations has not identified any business
opportunity that it plans to pursue, nor has Great Expectations
reached any agreement or definitive understanding with any person
concerning an acquisition.
Frederick Mahlke, one of Company's officers and directors has
previously been involved in transactions involving a merger between an
established company and a shell entity, and has a number of contacts
within the field of corporate finance. As a result, he has had
preliminary contacts with representatives of numerous companies
concerning the general possibility of a merger or acquisition by a
shell company. However, none of these preliminary contacts or
discussions involved the possibility of a merger or acquisition
transaction with Great Expectations.
We anticipate that Mr. Mahlke will contact broker-dealers and other
persons with whom he is acquainted who are involved in corporate
finance matters to advise them of Great Expectation's existence and to
determine if any companies or businesses they represent have an
interest in considering a merger or acquisition with Great
Expectations. No assurance can be given that Great Expectations
will be successful in finding or acquiring a desirable business
opportunity, given the limited funds that are expected to be available
for acquisitions, or that any acquisition that occurs will be on terms
that are favorable to Great Expectations or its stockholders.
Great Expectation's search will be directed toward small and medium-
sized enterprises which have a desire to become public corporations
and which are able to satisfy, or anticipate in the reasonably near
future being able to satisfy, the minimum asset requirements in order
to qualify shares for trading on NASDAQ or on a stock exchange
Great Expectations anticipates that the business opportunities
presented to it will
3
- be recently organized with no operating history, or a history
of losses attributable to under-capitalization or other factors;
- be in need of funds to develop a new product or service or to
expand into a new market;
- be relying upon an untested product or marketing any business,
to the extent of its limited resources. This includes industries such
as service, finance, natural resources, manufacturing, high
technology, product development, medical, communications and others.
Great Expectation's discretion in the selection of business
opportunities is unrestricted, subject to the availability of such
opportunities, economic conditions, and other factors. As a
consequence of this registration of its securities, any entity, which
has an interest in being acquired by, or merging into Great
Expectations, is expected to be an entity that desires to become a
public company and establish a public trading market for its
securities.
In connection with such a merger or acquisition, it is highly likely
that an amount of stock constituting control of Great Expectations
would be issued by Great Expectations or purchased from the current
principal shareholders of Great Expectations by the acquiring entity
or its affiliates.
If stock is purchased from the current shareholders, the transaction
is very likely to result in substantial gains to them relative to
their purchase price for such stock. In Great Expectation's judgment,
none of its officers and directors would thereby become an
"underwriter" within the meaning of the Section 2(11) of the
Securities Act of 1933, as amended. The sale of a controlling
interest by certain principal shareholders of Great Expectations could
occur at a time when the other shareholders of Great Expectations
remain subject to restrictions on the transfer of their shares.
Depending upon the nature of the transaction, the current officers and
directors of Great Expectations may resign their management positions
with Great Expectations in connection with Great Expectation's
acquisition of a business opportunity.
In the event of such a resignation, Great Expectation's current
management would not have any control over the conduct of Great
Expectation's business following Great Expectation's combination with
a business opportunity. We anticipate that business opportunities will
come to Great Expectation's attention from various sources, including
our officer and director, our other stockholders, professional
advisors such as attorneys and accountants, securities broker-dealers,
venture capitalists, members of the financial community, and others
who may present unsolicited proposals.
Great Expectations has no plans, understandings, agreements, or
commitments with any individual for such person to act as a finder of
opportunities for Great Expectations. Great Expectations does not
foresee that it would enter into a merger or acquisition transaction
with any business with which its officers or directors are currently
affiliated. Should Great Expectations determine in the future,
contrary to the foregoing expectations, that a transaction with an
affiliate would be in the best interests of Great Expectations and its
stockholders, Great Expectations is permitted by Colorado law to enter
into such a transaction if:
- The material facts as to the relationship or interest
of the affiliate and as to the contract or transaction are
disclosed or are known to the Board of Directors, and the
Board in good faith authorizes the contract or transaction by
the affirmative vote of a majority of the disinterested
directors, even though the disinterested directors constitute
less than a quorum; or
- The material facts as to the relationship or interest
of the affiliate and as to the contract or transaction are
disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; or
4
- The contract or transaction is fair as to Great
Expectations as of the time it is authorized, approved or
ratified, by the Board of Directors or the stockholders.
Investigation and Selection of Business Opportunities
To a large extent, a decision to participate in a specific business
opportunity may be made upon:
- management's analysis of the quality of the other company's
management and personnel,
- the anticipated acceptability of new products or marketing
concepts,
- the merit of technological changes, the perceived benefit Great
Expectations will derive from becoming a publicly held entity, and
numerous other factors which are difficult, if not impossible, to
analyze through the application of any objective criteria.
In many instances, it is anticipated that the historical operations of
a specific business opportunity may not necessarily be indicative of
the potential for the future because of the possible need to shift
marketing approaches substantially, expand significantly, change
product emphasis, change or substantially augment management, or make
other changes. Great Expectations will be dependent upon the owners of
a business opportunity to identify any such problems which may exist
and to implement, or be primarily responsible for the implementation
of, required changes.
Because Great Expectations may participate in a business opportunity
with a newly organized firm or with a firm which is entering a new
phase of growth, it should be emphasized that Great Expectations will
incur further risks, because management in many instances will not
have proved its abilities or effectiveness, the eventual market for
such company's products or services will likely not be established,
and such company may not be profitable when acquired.
We anticipate that we will not be able to diversify, but will
essentially be limited to one such venture because of Great
Expectation's limited financing. This lack of diversification will
not permit Great Expectations to offset potential losses from one
business opportunity against profits from another, and should be
considered an adverse factor affecting any decision to purchase Great
Expectation's securities.
Holders of Great Expectation's securities should not anticipate that
Great Expectations necessarily will furnish such holders, prior to any
merger or acquisition, with financial statements, or any other
documentation, concerning a target company or its business. In some
instances, however, the proposed participation in a business
opportunity may be submitted to the stockholders for their
consideration, either voluntarily by such directors to seek the
stockholders' advice and consent or because state law so requires. The
analysis of business opportunities will be undertaken by or under the
supervision of Great Expectation's President, who is not a
professional business analyst.
Although there are no current plans to do so, Company management
might hire an outside consultant to assist in the investigation and
selection of business opportunities, and might pay a finder's fee.
Since Company management has no current plans to use any outside
consultants or advisors to assist in the investigation and selection
of business opportunities, no policies have been adopted regarding use
of such consultants or advisors, the criteria to be used in selecting
such consultants or advisors, the services to be provided, the term of
service, or regarding the total amount of fees that may be paid.
However, because of the limited resources of Great Expectations, it is
likely that any such fee Great Expectations agrees to pay would be
paid in stock and not in cash. Otherwise, Great Expectations
anticipates that it will consider, among other things, the following
factors:
- Potential for growth and profitability, indicated by new
technology, anticipated market expansion, or new products;
- Great Expectation's perception of how any particular
business opportunity will be received by the investment
community and by Great Expectation's stockholders;
5
- Whether, following the business combination, the
financial condition of the business opportunity would be, or
would have a significant prospect in the foreseeable future
of becoming sufficient to enable the securities of Great
Expectations to qualify for listing on an exchange or on a
national automated securities quotation system, such as
NASDAQ, so as to permit the trading of such securities to be
exempt from the requirements of a Rule 15g-9 adopted by the
Securities and Exchange Commission.
- Capital requirements and anticipated availability of
required funds, to be provided by Great Expectations or from
operations, through the sale of additional securities,
through joint ventures or similar arrangements, or from other
sources;
- The extent to which the business opportunity can be
advanced;
- Competitive position as compared to other companies of
similar size and experience within the industry segment as
well as within the industry as a whole;
- Strength and diversity of existing management, or
management prospects that are scheduled for recruitment;
- The cost of participation by Great Expectations as
compared to the perceived tangible and intangible values and
potential; and
- The accessibility of required management expertise,
personnel, raw materials, services, professional assistance,
and other required items. In regard to the possibility that
the shares of Great Expectations would qualify for listing on
NASDAQ, the current standards include the requirements that
the issuer of the securities that are sought to be listed
have total assets of at least $4,000,000 and total capital
and surplus of at least $2,000,000, and proposals have
recently been made to increase these qualifying amounts.
Many, and perhaps most, of the business opportunities that
might be potential candidates for a combination with Great
Expectations would not satisfy the NASDAQ listing criteria.
No one of the factors described above will be controlling in
the selection of a business opportunity, and management will
attempt to analyze all factors appropriate to each
opportunity and make a determination based upon reasonable
investigative measures and available data.
Potentially available business opportunities may occur in
many different industries and at various stages of
development, all of which will make the task of comparative
investigation and analysis of such business opportunities
extremely difficult and complex.
Potential investors must recognize that, because of Great
Expectation's limited capital available for investigation and
management's limited experience in business analysis, Great
Expectations may not discover or adequately evaluate adverse
facts about the opportunity to be acquired. Great
Expectations is unable to predict when it may participate in
a business opportunity. We expect, however, that the analysis
of specific proposals and the selection of a business
opportunity may take several months or more.
Prior to making a decision to participate in a business opportunity,
Great Expectations will generally request that we be provided with
written materials regarding the business opportunity containing such
items as
- a description of products
- services and company history
- management resumes
- financial information
- available projections, with related assumptions upon which they
are based
- an explanation of proprietary products and services;
6
- evidence of existing patents, trademarks, or services marks, or
rights thereto
- present and proposed forms of compensation to management
- a description of transactions between such company and its
affiliates during relevant periods
- a description of present and required facilities
- an analysis of risks and competitive conditions
- a financial plan of operation and estimated capital
requirements
- audited financial statements, or if they are not available,
unaudited financial statements, together with reasonable
assurances that audited financial statements would be able
to be produced within a reasonable period of time not to
exceed 60 days following completion of a merger transaction;
and other information deemed relevant.
As part of Great Expectation's investigation, Great Expectation's
executive officers and directors
- may meet personally with management and key personnel,
- may visit and inspect material facilities,
- obtain independent analysis or verification of certain
information provided,
- check references of management and key personnel, and
- take other reasonable investigative measures, to the extent of
Great Expectation's limited financial resources and
management expertise.
Regulation of Penny Stocks
Our management believes that various types of potential merger or
acquisition candidates might find a business combination with Great
Expectations to be attractive. These include
- acquisition candidates desiring to create a public market for
their shares in order to enhance liquidity for current shareholders,
- acquisition candidates which have long-term plans for raising
capital through the public sale of securities and believe that the
possible prior existence of a public market for their securities would
be beneficial, and
- acquisition candidates which plan to acquire additional assets
through issuance of securities rather than for cash, and believe that
the possibility of development of a public market for their securities
will be of assistance in that process.
Acquisition candidates that have a need for an immediate cash infusion
are not likely to find a potential business combination with Great
Expectations to be an attractive alternative.
Form of Acquisition
It is impossible to predict the manner in which Great Expectations may
participate in a business opportunity. Specific business opportunities
will be reviewed as well as the respective needs and desires of Great
Expectations and the promoters of the opportunity and, upon the basis
of that review and the relative negotiating strength of Great
Expectations and such promoters, the legal structure or method deemed
by management to be suitable will be selected. Such structure may
include, but is not limited to
- leases, purchase and sale agreements,
- licenses,
- joint ventures and
- other contractual arrangements.
Great Expectations may act directly or indirectly through an interest
in a partnership, corporation or other form of organization.
Implementing such structure may require the merger, consolidation or
reorganization of Great Expectations with other corporations or forms
of business organization, and although it is likely, we cannot assure
you that Great Expectations would be the surviving entity. In
addition, the present management and stockholders of Great
Expectations most likely will not have control of a majority of the
voting shares of Great Expectations following a reorganization
transaction. As part of such a transaction, Great Expectation's
existing directors may resign and new directors may be appointed
7
without any vote by stockholders. It is likely that Great Expectations
will acquire its participation in a business opportunity through the
issuance of common stock or other securities of Great Expectations.
Although the terms of any such transaction cannot be predicted, in
certain circumstances, the criteria for determining whether or not an
acquisition is a so-called "tax free" reorganization under the
Internal Revenue Code of 1986, depends upon the issuance to the
stockholders of the acquired company of a controlling interest equal
to 80% or more of the common stock of the combined entities
immediately following the reorganization.
If a transaction were structured to take advantage of these provisions
rather than other "tax free" provisions provided under the Internal
Revenue Code, Great Expectation's current stockholders would retain in
the aggregate 20% or less of the total issued and outstanding shares.
This could result in substantial additional dilution in the equity of
those who were stockholders of Great Expectations prior to such
reorganization. Our issuance of these additional shares might also
be done simultaneously with a sale or transfer of shares representing
a controlling interest in Great Expectations by the current officers,
directors and principal shareholders.
We anticipate that any new securities issued in any reorganization
would be issued in reliance upon exemptions, if any are available,
from registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of the
transaction, Great Expectations may agree to register such securities
either at the time the transaction is consummated, or under certain
conditions or at specified times thereafter.
The issuance of substantial additional securities and their potential
sale into any trading market that might develop in Great Expectation's
securities may have a depressive effect upon such market. Great
Expectations will participate in a business opportunity only after the
negotiation and execution of a written agreement.
Although the terms of such agreement cannot be predicted, generally
such an agreement would require
- specific representations and warranties by all of the parties
thereto,
- specify certain events of default,
- detail the terms of closing and the conditions which must be
satisfied by each of the parties thereto prior to such closing,
- outline the manner of bearing costs if the transaction is not
closed,
- set forth remedies upon default, and
- include miscellaneous other terms.
Great Expectations anticipates that we, and/or our officers and
principal shareholders will enter into a letter of intent with the
management, principals or owners of a prospective business opportunity
prior to signing a binding agreement. This letter of intent will set
forth the terms of the proposed acquisition but will not bind any of
the parties to consummate the transaction. Execution of a letter of
intent will by no means indicate that consummation of an acquisition
is probable. Neither Great Expectations nor any of the other parties
to the letter of intent will be bound to consummate the acquisition
unless and until a definitive agreement concerning the acquisition as
described in the preceding paragraph is executed.
Even after a definitive agreement is executed, it is possible that the
acquisition would not be consummated should any party elect to
exercise any right provided in the agreement to terminate it on
specified grounds. We anticipate that the investigation of specific
business opportunities and the negotiation, drafting and execution of
relevant agreements, disclosure documents and other instruments will
require substantial management time and attention and substantial
costs for accountants, attorneys and others.
If we decide not to participate in a specific business opportunity,
the costs incurred in the related investigation would not be
recoverable. Moreover, because many providers of goods and services
require compensation at the time or soon after the goods and services
are provided, our inability to pay until an indeterminate future time
may make it impossible to procure goods and services.
8
Investment Company Act and Other Regulation
Great Expectations may participate in a business opportunity by
purchasing, trading or selling the securities of such business. Great
Expectations does not, however, intend to engage primarily in such
activities.
Specifically, Great Expectations intends to conduct its activities so
as to avoid being classified as an investment company under the
Investment Company Act of 1940, and therefore to avoid application of
the costly and restrictive registration and other provisions of the
Investment Act, and the regulations promulgated thereunder.
Section 3(a) of the Investment Act contains the definition of an
investment company, and it excludes any entity that does not engage
primarily in the business of investing, reinvesting or trading in
securities, or that does not engage in the business of investing,
owning, holding or trading investment securities defined as all
securities other than government securities or securities of majority-
owned subsidiaries the value of which exceeds 40% of the value of its
total assets excluding government securities, cash or cash items.
Great Expectations intends to implement its business plan in a manner
that will result in the availability of this exception from the
definition of investment company. As a result, Great Expectation's
participation in a business or opportunity through the purchase and
sale of investment securities will be limited.
Great Expectation's plan of business may involve changes in our
capital structure, management, control and business, especially if we
consummates a reorganization as discussed above. Each of these areas
is regulated by the Investment Act, in order to protect purchasers of
investment company securities. Since Great Expectations will not
register as an investment company, stockholders will not be afforded
these protections.
Any securities which Great Expectations might acquire in exchange for
our common stock will be restricted securities within the meaning of
the Securities Act of 1933. If Great Expectations elects to resell
such securities, such sale cannot proceed unless a registration
statement has been declared effective by the Securities and Exchange
Commission or an exemption from registration is available. Section
4(1) of the Act, which exempts sales of securities not involving a
distribution, would in all likelihood be available to permit a private
sale.
Although the plan of operation does not contemplate resale of
securities acquired, if such a sale were to be necessary, Great
Expectations would be required to comply with the provisions of the
Act to effect such resale. An acquisition made by Great Expectations
may be in an industry that is regulated or licensed by federal, state
or local authorities. Compliance with such regulations can be expected
to be a time-consuming and expensive process.
Competition
Great Expectations expects to encounter substantial competition in its
efforts to locate attractive opportunities, primarily from business
development companies, venture capital partnerships and corporations,
venture capital affiliates of large industrial and financial
companies, small investment companies, and wealthy individuals. Many
of these entities will have significantly greater experience,
resources and managerial capabilities than Great Expectations and will
therefore be in a better position than Great Expectations to obtain
access to attractive business opportunities. Great Expectations also
will experience competition from other public blind pool companies,
many of which may have more funds available than does Great
Expectations.
Employees
Great Expectations is a development stage company and currently has no
employees. Management of Great Expectations expects to use
consultants, attorneys and accountants as necessary, and does not
anticipate a need to engage any full-time employees so long as it is
seeking and evaluating business opportunities. The need for employees
and their availability will be addressed in connection with the
decision whether or not to acquire or participate in specific business
opportunities.
9
Although there is no current plan with respect to its nature or
amount, we may pay or accrue remuneration for the benefit of, Great
Expectation's officers prior to, or at the same time as the completion
of a business acquisition
ITEM 2. PROPERTIES.
Great Expectations has a mailing address at 501 South Cherry St.,
Suite 610, Denver, Colorado 80246, phone number is (303) 320-0066.
Other than this mailing address, Great Expectations does not currently
have any other office facilities. We do not anticipate the need for
office facilities at any time in the foreseeable future. Great
Expectations pays no rent or other fees for the use of this mailing
address.
ITEM 3. LEGAL PROCEEDINGS.
Great Expectations is not involved in any legal proceedings at this
date.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
During the fourth quarter of the fiscal year ended October 31, 2000,
no matters were submitted to a vote of Great Expectations' security
holders, through the solicitation of proxies.
10
PART II
ITEM 5. MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
Market Information. Great Expectation's common stock is not listed
in the pink sheets or in the OTC Bulletin Board maintained by the
NASD.
Holders. The approximate number of holders of record of Great
Expectation's no par value common stock, as of June 30, 2000 was 10.
Dividends. Holders of Great Expectation's common stock are entitled
to receive such dividends as may be declared by its board of
directors.
Tradability. We do not meet the requirements for our stock to be
quoted on NASDAQ and the tradability in our stock will be limited
under the penny stock regulation.
If the trading price of our common stock is less than $5.00 per share,
trading in the common stock would also be subject to the requirements
of Rule 15g-9 under the Exchange Act. Under this rule,
broker/dealers who recommend low-priced securities to persons other
than established customers and accredited investors must satisfy
special sales practice requirements. The broker/dealer must make an
individualized written suitability determination for the purchaser and
receive the purchaser's written consent prior to the transaction.
SEC regulations also require additional disclosure in connection with
any trades involving a "penny stock", including the delivery, prior to
any penny stock transaction, of a disclosure schedule explaining the
penny stock market and its associated risks. Such requirements
severely limit the liquidity of the common stock in the secondary
market because few broker or dealers are likely to undertake such
compliance activities. Generally, the term penny stock refers to a
stock with a market price of less than $5.00 per share.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
Liquidity and Capital Resources
Great Expectations remains in the development stage and, since
inception, has experienced no significant change in liquidity
or capital resources. Great Expectation's balance sheet as
of October 31, 2000, reflects a current asset value of $0, and
a total asset value of $22,099 in the form of deferred
offering costs. Great Expectations will carry out its plan
of business as discussed above. Great Expectations cannot
predict to what extent its liquidity and capital resources
will be diminished prior to the consummation of a business
combination or whether its capital will be further depleted by
the operating losses, if any of the business entity which
Great Expectations may eventually acquire.
Results of Operations
During the period from June 5, 1987 (inception) through
October 31, 2000, Great Expectations has engaged in no
significant operations other than organizational activities,
acquisition of capital and preparation for registration of its
securities under the Securities Exchange Act of 1934, as
amended. No revenues were received by Great Expectations
during this period.
For the current fiscal year, Great Expectations anticipates
incurring a loss as a result of expenses associated with
registration under the Securities Exchange Act of 1934, and
expenses associated with locating and evaluating acquisition
candidates. Great Expectations anticipates that until a
business combination is completed with an acquisition
candidate, we will not generate revenues other than interest
income, and may continue to operate at a loss after completing
a business combination, depending upon the performance of the
acquired business.
11
Great Expectations believes that our existing capital will not
be sufficient to meet Great Expectation's cash needs,
including the costs of compliance with the continuing
reporting requirements of the Securities Exchange Act of 1934,
as amended, for a period of approximately one year.
Accordingly, in the event Great Expectations is able to
complete a business combination during this period, it
anticipates that our existing capital will not be sufficient
to allow us to accomplish the goal of completing a business
combination. Great Expectations will depend on additional
advances from stockholders.
We cannot assure you that the available funds will ultimately
prove to be adequate to allow it to complete a business
combination, and once a business combination is completed,
Great Expectation's needs for additional financing are likely
to increase substantially. Management and other stockholders
have not made any commitments to provide additional. We
cannot assure you that any additional funds will be available
to Great Expectations to allow us to cover our expenses.
Even if Great Expectation's cash assets prove to be inadequate
to meet Great Expectation's operational needs, Great
Expectations might seek to compensate providers of services by
issuances of stock in lieu of cash.
We do not expect to purchase or sell any significant
equipment, engage in product research or development and do
not expect any significant changes in the number of employees.
12
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Tannenbaum & Company, P.C.
Certified Public Accountants
INDEPENDENT AUDITORS'REPORT
The Board of Directors
Great Expectations and Associates Inc.
Englewood, Colorado
We have audited the accompanying balance sheet of Great
Expectations and Associates Inc. (a development stage
enterprise) as of October 31, 2000, and the related statements
of stockholders' equity, loss and accumulated deficit, and
cash flows for the period from the date of inception (June 5,
1987) to October 31, 2000. These financial statements are the
responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management,
as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial
position of Great Expectations and Associates Inc., as of
October 31, 2000, the changes in its stockholders' equity, the
results of its operations and its cash flows for the period
then ended in conformity with generally accepted accounting
principles.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.
As discussed in Note 6 to the financial statements, the
Company has suffered recurring losses from operations and has
a net capital deficiency that raise substantial doubt about
its ability to continue as a going concern. The financial
statements do not include any adjustments that might result
from the outcome of this uncertainty.
Denver, Colorado
November 3, 2000
Tannenbaum & Company P.C.
1873 S. Bellaire Suite 908 Denver, Colorado 80222 (303) 756-5216
FAX (303) 757-5279
13
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
BALANCE SHEET
October 31, 2000
October
31,2000
ASSETS
CURRENT ASSETS
Cash $ -
----------
Total current assets -
Other Assets
Deferred offering costs (Note 1) 22,099
--------
Total other assets 22,099
--------
Total assets 22,099
-------
LIABILITIES AND STOCKHOLDERS'EQUITY
CURRENT LIABILITIES
Due to stockholders (Note 4) $ 22,012
------
Total current liabilities 22,012
STOCKHOLDERS'EQUITY
Common stock, no par value, 500,000,000
shares authorized; 150,520,000 shares
issued and outstanding (Note 1) 20,432
------
Deficit accumulated during the development stage (20,345)
--------
Total stockholders' equity 87
Total liabilities and stockholders' equity $22,099
--------
The accompanying notes are an integral part of the financial statements.
14
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT
For the period from inception (June 5, 1987) to October 31, 2000
Inception
to October October
31, 2000 31, 2000
Revenue
Interest Income $ 166 -
--------- --------
Total revenue 166 -
Other expense
Amortization 700 -
Rent 4,512 -
Salaries (Note 3) 6,129 -
Office supplies and expense (Note7) 4,250 4,250
Legal 1,500 1,500
Travel 1,435 1,435
Filing fees 1,030 1,030
Accounting 955 600
-------- ---------
Total expense 20,511 8,815
-------- ---------
NET LOSS (20,345) (8,815)
Accumulated deficit
Balance, beginning of period - (11,530)
------- -------
Balance, end of period $(20,345) (20,345)
-------- -------
Loss per share $ (Nil) (Nil)
-------- -------
Shares outstanding 150,520,000 150,520,000
The accompanying notes are an integral part of the financial statements.
15
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
STATEMENT OF STOCKHOLDERS'EQUITY
For the period from inception (June 5, 1987) to October 31, 2000
Common stock Total
------------ Accumu- stock-
Number lated holders'
of shares Amount deficit equity
---------- ------- -------- ----------
Balance, June 5, 1987 - $ - $ - $ -
Issuance of stock for cash
July 1987 ($.00005 per share) 67,000,000 3,000 - 3,000
Issuance of stock for cash
July 1987 ($.0017 per share) 7,200,000 12,000 - 12,000
Issuance of stock for services (Note 3)
July 1987 ($.0017 per share) 1,000,000 1,666 - 1,666
Issuance of stock for services (Note 3)
March 1998 ($.00005 per share) 75,320,000 3,766 - 3,766
Net loss for the period inception
to October 31, 1998 - - (10,833) (10,833)
------------ -------- --------- ---------
Balance, October 31, 1998 150,520,000 20,432 (10,833) 9,599
Issuance of stock for services (Note 3)
October 1999 ($.00005 per share) 7,300,000 326 326
Issuance of stock for services (Note 3)
October 1999 ($.00005 per share) 7,300,000 326 326
Issuance of stock for services (Note 3)
October 1999($.00005 per share) 1,000,000 45 45
Net loss for the period October 31, 1999 - - (697) (697)
---------- ------- -------- -------
Balance, October 31, 1999 166,120,000 $ 21,129 $(11,530) $9,599
Net loss for the period October 31, 2000 (8,815) (8,815)
Treasury stock (15,600,000) (697) (697)
Balance, October 31, 2000 150,520,000 $20,432 $ (20,345) $697
----------- ------- ----------- ---------
The accompanying notes are an integral part of the financial statements.
16
Great Expectations and Associates, Inc.
A Development Stage Enterprise)
STATEMENTS OF CASH FLOWS
For the periods ended October 31, 2000
Inception
to October October
31, 2000 31, 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $(20,345) (8,815)
Add non-cash items:
Salaries paid with stock (Note 3) 5,432 (697)
Organizational cost amortization 700 -
Increase in organizational cost (700) -
---------- --------
Cash used in operations (14,913) (9,512)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from loans-stockholders (Note 4) 22,012 18,012
Proceeds from issuance of common stock 15,000 -
Offering costs (Note 1) (22,099) (8,500)
----------- --------
Cash provided by financing activities 14,913 9,512
----------- --------
Net increase (decrease) in cash - -
Cash, beginning of periods - -
----------- --------
Cash, end of periods $ - -
=========== ========
The accompanying notes are an integral part of the financial statements.
17
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
October 31, 2000
1. Summary of significant accounting policies
Organization
Great Expectations and Associates Inc. (the "Company",
formerly Great Expectations, Inc.) was organized under the
laws of the State of Colorado on June 5, 1987, for the purpose
of evaluating and seeking merger candidates. The Company is
currently considered to be in the development stage as more
fully defined in the Financial Accounting Standards Board
Statement No. 7. The Company has engaged in limited
activities, but has not generated significant revenues to
date. The Company is currently seeking business
opportunities.
Accounting methods
The Company records income and expenses on the accrual method.
Fiscal year
The Company has selected October 31 as its fiscal year.
Deferred offering cost
Costs associated with any public offering were charged to
proceeds of the offering.
Loss per share
All stock outstanding prior to the public offering had been
issued at prices substantially less than that which was paid
for the stock in the public offering. Accordingly, for the
purpose of the loss per share calculation, shares outstanding
at the end of the period were considered to be outstanding
during the entire period.
2. Income taxes
Since its inception, the Company has incurred a net operating
loss. Accordingly, no provision has been made for income
taxes.
3. Stock issued for services
The value of the stock issued for services is based on
management's estimate of the fair market value of the services
rendered.
4. Due to stockholders
During the fiscal year advances totaling $22,012 were made to
the Company by stockholders.
5. Management representation
For the period ended October 31, 2000 management represents that
all adjustments necessary to a fair statement of the results for
the period have been included and such adjustments are of a
normal and recurring nature.
6. Going concern
The company has suffered recurring losses from operations and
has a net capital deficiency that raise substantial doubt about
its ability to continue as a going concern.
18
Tannenbaum & Company, P.C.
Certified Public Accountants
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Great Expectations and Associates Inc.
Englewood, Colorado
We have audited the accompanying balance sheet of Great Expectations
and Associates Inc. (a development stage enterprise) as of October 31,
1999, and the related statements of stockholders' equity, loss and
accumulated deficit, and cash flows for the period from the date of
inception (June 5, 1987) to October 31, 1999. These financial
statements are the responsibility of Great Expectation's management.
Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Great
Expectations and Associates Inc., as of October 31, 1999, the chances
in its stockholders' equity, the results of its operations and its
cash flows for the period then ended in conformity with Generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that
Great Expectations will continue as a going concern. As discussed in
Note 6 to the financial statements, the Company has suffered recurring
losses from operations and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going concern.
The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
Denver, Colorado
November 3, 1999
Tannenbaum & Company P.C.
1873 S. Bellaire Suite 908 Denver, Colorado 90222
(303) 756-5216 FAX (303) 757-5279
19
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
BALANCE SHEET
October 31, 1999
October
31, 1999
ASSETS
CURRENT ASSETS
Cash $ -
---------
Total current assets -
Other Assets
Deferred offering costs (Note 1) 13,599
---------
Total other assets 13,599
---------
Total assets 13,599
=========
LIABILITIES AND STOCKHOLDERS'EQUITY
CURRENT LIABILITIES
Due to stockholders (Note 4) $4,000
---------
Total current liabilities 4,000
STOCKHOLDERS'EQUITY
Common stock, no par value, 500,000,000
shares authorized; 1166,120,000 shares
issued and outstanding (Note 1) 21,129
Deficit accumulated during the development stage (11,530)
Total stockholders' equity 9,599
---------
Total liabilities and stockholders' equity $13,599
=========
The accompanying notes are an integral part of the financial
statements.
20
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT
For the period from inception (June 5, 1987) to October 31,
1999
Inception
to October October
31, 1999 31, 1999
Revenue
Interest Income $ 166 -
------ ------
Total revenue 166 -
Other expense
Amortization 700 -
Rent 4,512 -
Salaries (Note 3) 6,129 697
Accounting 355 -
------- ------
Total expense 11,696 697
------- ------
NET LOSS (11,530) (697)
Accumulated deficit
Balance, beginning
of period - (10,833)
-------- ---------
Balance, end of period $(11,530) (11,530)
======== =========
Loss per share $ (Nil) $ (Nil)
======== =========
Shares outstanding 166,120,000 166,120,000
=========== ===========
The accompanying notes are an integral part of the financial
statements.
21
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
STATEMENT OF STOCKHOLDERS'EQUITY
For the period from inception (June 5, 1987) to October 31,
1999
Total
Common stock Accumu- stock-
Number lated holders'
of shares Amount deficit equity
Balance, June 5, 1987 - $ - $ - $ -
Issuance of stock for cash
July 1987
($.00005 per share) 67,000,000 3,000 - 3,000
Issuance of stock for cash
July 1987
($.0017 per share) 7,200,000 12,000 - 12,000
Issuance of stock for services (Note 3)
July 1987
($.0017 per share) 1,000,000 1,666 - 1,666
Issuance of stock for services (Note 3)
March 1998
($.00005 per share) 75,320,000 3,766 - 3,766
Net loss for the period inception
to October 31, 1998 - - (10,833) (10,833)
Balance, October 31, 1998 150,520,000 20,432 (10,833) 9,599
Issuance of stock for services (Note 3)
October 1999
($.00005 per share) 7,300,000 326 326
Issuance of stock for service (Note 3)
October 1999
($.00005 per share) 7,300,000 326 326
Issuance of stock for services(Note 3)
October 1999
($.00005 per share) 1,000,000 45 45
Net loss for the period
October 31, 1999 - - (697) (697)
Balance, October 31, 1999 166,120,000 $21,129 $(11,530) $9,599
The accompanying notes are an integral part of the financial
statements.
22
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
STATEMENTS OF CASH FLOWS
For the period ended October 31, 1999
Inception
to October October
31,1999 31,1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $(11,530) $(697)
Add non-cash items:
Salaries paid with stock (Note 3) 6,129 697
Organizational cost amortization 700 -
Increase in organizational cost (700) -
------- ------
Cash used in operations (5,401) -
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from loans-stockholders (Note 4) 4,000 -
Proceeds from issuance of common stock 15,000 -
Offering costs (Note 1) (13,599) -
------- ------
Cash provided by financing activities 5,401 -
------- ------
Net increase (decreease) in cash - -
Cash, beginning of periods - -
------- ------
Cash, end of periods $ - -
======= ======
The accompanying notes are an integral part of the financial
statements.
23
Great Expectations and Associates, Inc.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
October 31, 1999
1. Summary of significant accounting policies Organization Great
Expectations and Associates Inc. (the "Company", formerly Great
Expectations, Inc.) was organized under the laws of the State of
Colorado on June 5, 1987, for the purpose of evaluating and seeking
merger candidates. Great Expectations is currently considered to be
in the development stage as more fully defined in the Financial
Accounting Standards Board Statement No. 7. Great Expectations has
engaged in limited activities, but has not generated significant
revenues to date. Great Expectations is currently seeking business
opportunities.
Accounting methods
Great Expectations records income and expenses on the accrual method.
Fiscal year
Great Expectations has selected October 31 as its fiscal year.
Deferred offering cost
Costs associated with any public offering were charged to proceeds of
the offering.
Loss per share
All stock outstanding prior to the public offering had been issued at
prices substantially less than that which was paid for the stock in
the public offering. Accordingly, for the purpose of the loss per
share calculation, shares outstanding at the end of the period were
considered to be outstanding during the entire period.
2. Income taxes
Since its inception, Great Expectations has incurred a net operating
loss. Accordingly, no provision has been made for income taxes.
3. Stock for services
The value of the stock for services is based on management's estimate
of the fair market value of services rendered.
4. Due to stockholders
In February 1988 and December '31, 1998, advances totaling $4,000 were
made to Great Expectations by stockholders.
5 . Management representation
For the period ended October 1, 1999 management represents that all
adjustments necessary to a fair statement of the results for the
period have been included and such adjustments are of a normal and
recurring nature.
Note 6. Going concern
The Company has suffered recurring losses from operations and has a
net capital deficiency that raise substantial doubt about its ability
to continue as a going concern.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
There have not been any changes in or disagreements with accountants
on accounting and financial disclosure.
24
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
The principal executive officers and directors of Great Expectations
are
Name Position Term of office
Raphael M. Solot President/Treasurer November 1999
Director to present
Frederick W. Mahlke Vice President/Secretary July 1987
Director to present
Only Mr. Mahlke has been involved with prior blank check companies.
The directors named above will serve until the next annual meeting of
Great Expectation's stockholders. Officers will hold their positions
at the pleasure of the board of directors, absent any employment
agreement, of which none currently exists or is contemplated.
There is no arrangement or understanding between the directors and
officers of Great Expectations and any other person under which any
director or officer was or is to be selected as a director or officer.
The directors and officer of Great Expectations will devote their time
to Great Expectation's affairs on an "as needed" basis. As a result,
the actual amount of time which they will devote to Great
Expectation's affairs is unknown and is likely to vary substantially
from month to month.
Biographical Information
Raphael M. Solot. Mr. Solot has been an attorney in private practice
in Colorado since 1964 with an emphasis on complex civil litigation,
corporate and franchise law. From 1994 until March 1996, Mr. Solot
served on the Board of Directors of Jones Global, Ltd., a corporation
engaged in the international cable business. From March 1996 until
the sale of Jones Intercable, M. Solot served on the Board of
Directors of Jones Intercable, Inc., the eighth largest cable
television company in the United States. Mr. Solot was elected Vice
Chairman of the Board of Jones Intercable, Inc. at the annual meeting
of shareholders in 1997 and served in that capacity until April 1998.
Mr. Solot received a Bachelor of Science degree from the University of
Colorado in 1958 and a Juris Doctor degree from the University of
Denver in 1963.
Frederick W. Mahlke. Mr. Malhke has served as a Director of Great
Expectations since July 1987. From November 1979 to present, Mr.
Mahlke has been President of Cumberland Sales and management of
Denver, Colorado, a commercial and residential management company.
For the past ten years, Mr. Mahlke has also worked as a Colorado
court-appointed receiver on over forty properties and has also been
appointed receiver for two California properties.
Mr. Mahlke's prior experience with blank check companies. Mr. Mahlke
was a director of Deversified Management Acquisitions II, Inc.
Deversified Management Acquisitions II, Inc. completed an offering on
From S-18 dated June 19, 1988. Deversified Management Acquisitions
II, Inc. merged with Constellation Development, Inc. (33-16885-1) in
March 1989. Mr. Mahlke resigned from Deversified Management
Acquisitions II, Inc. simultaneously with its merger with
Constellation Development, Inc. Thereafter, Constellation
Development, Inc. merged with Carpet Holdings, Inc. Constellation
Development, Inc. was an English real estate development and
acquisition company with real estate holdings in Liverpool, England
consisting of a shopping center. Carpet Holdings, Inc. was a carpet
wholesaler located in Dalton, Georgia.
Great Expectation's officers and directors may elect, in the future,
to form one or more additional shell companies with a business plan
similar or identical to that of Great Expectations. Any such
additional shell companies would also be in direct competition with
Great Expectations for available business opportunities.
We do not have a procedure in place that would allow these individuals
to resolve potential conflicts in an arms-length fashion. They will
be required to use their discretion to resolve them in a manner that
they consider appropriate. Great Expectation's officers and directors
25
may actively negotiate or otherwise consent to the purchase of a
portion of his common stock as a condition to, or in connection with,
a proposed merger or acquisition transaction.
We anticipate that a substantial premium over the initial cost of such
shares may be paid by the purchaser at the same time as any sale of
shares by Great Expectation's officers and directors which is made as
a condition to, or in connection with, a proposed merger or
acquisition transaction. The fact that a substantial premium may be
paid to Great Expectation's officers and directors to acquire their
shares creates a potential conflict of interest for them in satisfying
their fiduciary duties to Great Expectations and its other
shareholders. Even though such a sale could result in a substantial
profit to them, they would be legally required to make the decision
based upon the best interests of Great Expectations and Great
Expectation's other shareholders, rather than their own personal
pecuniary benefit.
ITEM 10. EXECUTIVE COMPENSATION
Other than described below, no compensation was awarded to, earned by,
or paid in the last three years. Mr. Solot received 1,000,000 Common
Shares at $.00005 per share in October 1999 as partial payment of
services.
Although there is no current plan in existence, it is possible that
Great Expectations will adopt a plan to pay or accrue compensation to
its officers and directors for services related to seeking business
opportunities and completing a merger or acquisition transaction.
Great Expectations has no stock option, retirement, pension, or profit-
sharing programs for the benefit of directors, officers or other
employees, but the board of directors may recommend adoption of one or
more such programs in the future.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth the number of shares of common stock
owned of record and beneficially by executive officers, directors and
persons who hold 5.0% or more of the outstanding common stock of Great
Expectations. Also included are the shares held by all executive
officers and directors as a group.
Name and Address Number of Percentage Percentage
Shares Outstanding of Shares of Shares
Outstanding After
Offering
Frederick W. Mahlke(1) 500,000 .30% .30%
4105 S. Florida Avenue
Suite 100
Denver, Colorado 80222
Raphael M. Solot 1,000,000 .60% .60%
501 South Cherry Street
Suite 610
Denver, Colorado 80222
Miles Wynn 139,340,000 83.88% 83.38%
3679 South Dawson Street
Aurora, Colorado 80014
Officers and Directors as a group
(2 persons) 1,500,000 .90% .90%
(1)Mr. Mahlke and Mr. Solot are officers and directors of Great
Expectations
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In February 1988 and December 31, 1998, advances totaling $4,000 were
made to Great Expectations by stockholders. No written repayment
terms were entered into.
In 1998, Capital Holding Company, an Oklahoma corporation purchased
67,680,000 shares of the treasury stock of Great Expectations, who in
turn issued the stock to Capital Holding Company and James Porter for
26
the sum of $.00005 per share. The shares were issued in lieu of
compensation for salaries and other administrative expenses valued at
$3,384 relating to bringing Great Expectations up to date with the
Colorado Secretary of State, providing updated accounting for Great
Expectations and paying all expenses relating to S.E.C. filings. In
addition, Great Expectations was provided office space by Capital
Holding Company.
In June 1998, Miles Wynn received 7,520,000 shares of Great
Expectations for the sum of $.00005 per share in lieu of salary and
other compensation due to Mr. Wynn valued at $376. This compensation
included repayment of expenses relating to S.E.C. filings and corporate
state filings. Wynn also provided Great Expectations with office
space at no cost to the company from 1987 to June 16, 1999 and
thereafter, from March 10, 1999 to November 12, 1999.
On March 10, 1999, Mr. Wynn purchased the 67,680,000 shares of Great
Expectations owned jointly by Capital Holding Company and James Porter
for the sum of $25,000.
No officer, director, promoter, or affiliate of Great Expectations has
or proposes to have any direct or indirect material interest in any
asset proposed to be acquired by Great Expectations through security
holdings, contracts, options, or otherwise. Great Expectations has
adopted a policy under which any consulting or finder's fee that may be
paid to a third party for consulting services to assist management in
evaluating a prospective business opportunity would be paid in stock or
in cash. Any such issuance of stock would be made on an ad hoc basis.
Accordingly, Great Expectations is unable to predict whether or in what
amount such a stock issuance might be made.
Although there is no current plan in existence, it is possible that
Great Expectations will adopt a plan to pay or accrue compensation to
its sole officer and director for services related to seeking business
opportunities and completing a merger or acquisition transaction. Great
Expectations maintains a mailing address at the office of its legal
counsel, but otherwise does not maintain an office. As a result, it
pays no rent and incurs no expenses for maintenance of an office and
does not anticipate paying rent or incurring office expenses in the
future. It is likely that Great Expectations will establish and
maintain an office after completion of a business combination.
Although management has no current plans to cause Great Expectations to
do so, it is possible that Great Expectations may enter into an
agreement with an acquisition candidate requiring the sale of all or a
portion of the common stock held by Great Expectation's current
stockholders to the acquisition candidate or principals thereof, or to
other individuals or business entities, or requiring some other form of
payment to Great Expectation's current stockholders, or requiring the
future employment of specified officers and payment of salaries to
them.
It is more likely than not that any sale of securities by Great
Expectation's current stockholders to an acquisition candidate would be
at a price substantially higher than that originally paid by such
stockholders. Any payment to current stockholders in the context of an
acquisition involving Great Expectations would be determined entirely
by the largely unforeseeable terms of a future agreement with an
unidentified business entity.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
List of Exhibits
The following exhibits are filed with this report:
(27) Financial Data Schedule
Reports on Form 8-K
None
27
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Company has duly caused this
Report to be signed on its behalf by the undersigned duly authorized
person.
Date: September 7, 2001 GREAT EXPECTATIONS, INC.
/s/ Raphael Solot
------------------------------------
By: Raphael Solot, President
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this report has been signed below by the following persons
on behalf of the Company and in the capacities and on the dates
indicated.
/s/Raphael Solot, Principal Executive Officer September 7,
2001
- -------------------- Principal Financial Officer
Controller Director
/s/Fredrick Mahlke Secretary/Vice President September 7,
2001
- -------------------- Director
