10-Q/A 1 d25972_10qa.txt AMENDED FROM 10-Q ISSUER INFORMATION FILE Third Fiscal Quarterly Report (SEC form 10Q) Date May 23, 2001 AMERICA'S SPORTS VOICE, INC. 247 Broadway Huntington, New York 11743 Phone: 631 754-9200 Fax: 631 754-9369 Federal I.D. Number: Cusip Number: 11-3363563 03061W 10 9 ISSUER'S EQUITY SECURITIES Common Equity Voting Stock $.0001 par value 150,000,000 shares authorized 13,500,278 shares issued and outstanding TRANSFER AGENT OTC Corporate Transfer Service Co. P.O. Box 501 Hicksville, New York 11802 Phone: 516-433-6503 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Index to Form 10-QSB For the Periods Ended March 31, 2001 PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets ................................... 3 Consolidated Statements of Operations .......................... 4-5 Consolidated Statements of Stockholders' Deficit................ 6-7 Consolidated Statements of Cash Flows .......................... 8-10 Notes to Consolidated Financial Statements ..................... 11-20 Item 2. Management's Discussion and Analysis ............................. 21-24 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS MARCH 31, 2001 AND JUNE 30, 2000

3 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000 2000 1999 ------------ ----------- Sales $ 103,295 -- Cost of sales (116,392) -- ------------ ----------- Gross profit (13,097) -- General and Administrative Expenses Professional fees 46,788 -- Salaries and benefits 123,430 -- Office and other administrative expenses 108,477 301,677 Bad debt expense -- -- Depreciation -- -- ------------ ----------- Total general and administrative expenses (278,695) (301,677) ------------ ----------- (Loss) from operations (291,792) (301,677) ------------ ----------- Other income and expense Interest expense (5,475) -- ------------ ----------- Total other income and (expense) (5,475) -- ------------ ----------- Net (loss) before income taxes (297,267) (301,677) Income taxes -- -- ------------ ----------- Net (loss) $ (297,267) $ (301,677) ============ =========== Net (loss) per common share $ (.02) $ (.03) ============ =========== Weighted average number of shares of common stock outstanding 13,289,441 8,637,500 ============ =========== 4 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE NINE MONTHS ENDED MARCH 31, 2001 AND 2000 2001 2000 ------------ ----------- Sales $ 597,275 -- Cost of sales (427,364) -- ------------ ----------- Gross profit 169,911 -- General and Administrative Expenses Professional fees 248,556 -- Salaries and benefits 270,285 -- Office and other administrative expenses 356,288 402,135 Bad debt expense -- 339,808 Depreciation 145 1,155 ------------ ----------- Total general and administrative expenses 875,274 (743,098) ------------ ----------- (Loss) from operations (705,363) (743,098) ------------ ----------- Other income and expense Interest expense (16,433) -- ------------ ----------- Total other income and (expense) (16,433) -- ------------ ----------- Net (loss) before income taxes (721,796) (743,098) Income taxes -- -- ------------ ----------- Net (loss) $ (721,796) $ (743,098) ============ =========== Net (loss) per common share $ (.07) $ (.12) ============ =========== Weighted average number of shares of common stock outstanding 10,553,388 6,275,864 ============ =========== 5 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) FOR THE NINE MONTHS ENDED MARCH 31, 2001

6 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) FOR THE YEAR ENDED JUNE 30, 2000

7 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED MARCH 31, 2001 AND 2000 2001 2000 --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES: Net (loss) $(721,796) $(743,098) ADJUSTMENTS TO RECONCILE NET LOSS FROM OPERATIONS TO CASH USED IN OPERATING ACTIVITIES Bad debt -- 339,808 Depreciation and amortization 145 1,155 Stock issued for professional services 136,790 -- Stock issued in lieu of compensation 172,860 (Increase) decrease in assets: Accounts receivable (114,544) -- Inventories (37,687) -- Deferred acquisition costs 139,768 -- Increase (decrease) in liabilities: Accounts payable (74,726) 110,216 Salary and taxes payable 365,059 -- Accrued expenses 38,426 -- --------- --------- Total adjustments 626,091 451,179 --------- --------- Net cash provided by (used in) operations (95,705) (291,919) 8 AMERICA'S SPORTS VOICE, INC. and SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) FOR THE NINE MONTHS ENDED MARCH 31, 2001 AND 2000 2001 2000 -------- --------- Balance forward (95,705) (291,919) CASH FLOWS FROM INVESTING ACTIVITIES: Security Deposits -- (5,000) Capital expenditures (1,495) -------- --------- Net cash flows (used) in investing activities (1,495) (5,000) CASH FLOWS FROM FINANCING ACTIVITIES: Stockholder loans -- 93,112 Loans receivable (advanced) repaid 1,150 203,917 Net proceeds from loans 65,500 -- -------- --------- Net cash from (used) in financing activities 66,650 297,029 Net Increase (decrease) in cash in banks (30,550) 110 -------- --------- Cash in banks - beginning of period 16,285 (10) -------- --------- Cash in banks - end of period $(14,265) $ 100 ======== ========= Supplemental Disclosure of Cash Flow Information: Cash Paid During the Period for: Interest expense $ -- $ -- ======== ========= Income taxes $ -- $ -- ======== ========= 9 AMERICA'S SPORTS VOICE, INC. and SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) FOR THE NINE MONTHS ENDED MARCH 31, 2001 and 2000 NON-CASH INVESTING AND FINANCING TRANSACTIONS During the quarter ended September 30, 2000, ASV issued 520,000 shares of common stock valued at $124,850 in connection with professional promotion services. During the quarter ended March 31, 2001, ASV issued 3,506,667 shares of retricted stock to two officers of the company in lieu of accrued compensation owed to them. The stock was valued at $.04 per share ($126,240) for the purpose of settling the accrued compensation. During the quarter ended March 31, 2001, ASV issued 600,000 share of restricted stock valued at $46,620 to an employee in lieu of compensation. Further, ASV issued 100,000 shares of stock valued at $11,940 for legal services rendered. 10 AMERICA'S SPORTS VOICE, INC. and SUBSIDIARY Notes to Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 Note 1 - Unaudited Financial Information The unaudited financial information included for the periods ended March 31, 2001 and 2000 was taken from the books and records without audit. However, such information reflects all adjustments (consisting only of normal recurring adjustments, which are of the opinion of management, necessary to reflect properly the results of interim periods presented.) The results of operations for the nine-month period ended March 31, 2001 are not necessarily indicative of the results expected for the fiscal year ending June 30, 2001. Note 2 - Summary of Significant Accounting Policies This summary of significant accounting policies of America's Sports Voice, Inc. and subsidiary (hereinafter referred to "ASV" or "the Company") is presented to assist in understanding the financial statements. The financial statements and notes are representations of the management of ASV, who is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements. (A) Nature of Business America's Sports Voice, Inc. was incorporated in the State of New York in February 1997. The Company was formed to create a sports fan advocacy group that provides information, sports programming and sports merchandise. Since inception, the Company has not generated any revenues from its intended principal business activity. Effective June 28, 2000, the company created a wholly owned subsidiary, Gourmet Cuisine Corp. that was formed for the purpose of acquiring the assets and business of Gourmet Cuisines International, Ltd., as described in Note 4. 11 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 (B) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. (C) Revenue Recognition ASV records revenue when products are shipped from its plant. (D) Office Equipment and Depreciation Office equipment is stated at cost. Upon retirement or disposal of assets, the cost and accumulated depreciation are eliminated and the resulting gain or loss is included in other income. Maintenance and repairs are expensed as incurred. Depreciation of equipment is provided over the estimated useful lives of the various assets. Generally, the equipment has been depreciated using the straight-line method over a period of five years. Depreciation expense was $145 and $1,155 for the nine months ended March 31, 2001 and 2000, respectively. 12 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 (E) Deferred Acquisition Costs Deferred acquisition costs represent the costs associated with the planned acquisition described in Note 4. Deferred acquisition costs are capitalized as a component of total acquisition costs until successful consummation of a planned acquisition. Such costs will be expensed upon determination that a proposed acquisition is unlikely to occur or will be amortized upon completion of the acquisition. Until October 28, 2000, the Company was offsetting rent payments as per an agreement with Hannelore Enterprises against amounts advanced to Gourmet Cuisines International, Ltd. Since October 28, 2000 as discussed in note 7 (Litigation), ASV has stopped offsetting rent payable to Hannelore and is accruing rent of $11,000 per month pending the resolution of the legal matter. (F) Inventories Inventories are stated at the lower of cost or market. (G) Income Taxes No income taxes were provided during each of the fiscal periods presented since ASV incurred losses in each period. Normally, taxes are provided on all revenue and expense items included in the consolidated statement of operations, regardless of the period in which such items are recognized for income tax purposes, except for items representing a permanent difference between pretax accounting income and taxable income. (H) Reclassifications Certain reclassifications have been made to the 2000 financial statements in order to conform to the 2001 financial statement presentation. 13 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 (I) Consolidated Net (Loss) per Share Consolidated net (loss) per common share is computed on the basis of the weighted average number of common shares and equivalents outstanding during the period. Only the weighted average number of shares of common stock outstanding was used to compute basic loss per share for the periods ended March 31, 2001 and 2000 as the effect of stock options, or other common stock equivalents outstanding during the period were anti-dilutive. Note 3 - Financing Operations-Going Concern ASV has experienced cash losses from operations for the nine months ended March 31, 2001, which have been funded primarily by loans. The company will require additional equity or debt financing in order to sustain its ongoing operations. The Company is aggressively pursuing investors/lenders and is confident it will secure the necessary working capital within the near term with which it can continue to grow the Company and provide for its working capital and investment needs. Note 4 - Planned Acquisition In May 2000, ASV entered into an agreement to acquire all of the issued and outstanding stock of Gourmet Cuisines International, Ltd., a privately held company and its three wholly owned subsidiary companies (hereinafter jointly referred to as "GCI") in exchange for the issuance of an aggregate of 400,000 shares of ASV's "restricted" common stock. GCI is engaged in the business of processing gourmet meals for first class passengers on various air carriers. In conjunction therewith, ASV received an assignment of a security interest from Finova Capital Corporation ("Finova"), which held a first position security interest in all of the assets of GCI, for which ASV paid an aggregate of $219,000. The outstanding principal balance owed by GCI to Finova was $1,228,000 at the time the note and security interest was acquired by ASV. 14 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 Note 4 - Planned Acquisition (continued) Subsequent to entering into the agreement, ASV discovered that GCI had significant undisclosed liabilities. Such liabilities included a $5 million lawsuit against GCI. ASV also discovered that GCI was the guarantor of a mortgage given by 247 Broadway, LLC (an affiliate of GCI) the owner of the building that ASV presently operates in. Such mortgage was in default and on October 28, 2000, the building was foreclosed upon. As a result of the above developments, ASV decided not to close on the acquisition of GCI. Instead, ASV is planning to exercise its security interest acquired from Finova to foreclose on the related unpaid note and thereby acquire all the assets of GCI, including GCI's wholly owned subsidiaries. Such assets will be assigned to Gourmet Cuisine Corp., ASV's wholly owned subsidiary. In addition, ASV has personal guarantees from the two stockholders of GCI. Such plans are contingent upon ASV's ability to capitalize the food processing operations, obtain financing in the amount of approximately $500,000 to acquire real estate and to establish its planned operations in Utica, NY and to obtain financing in the amount of approximately $975,000 to acquire the building ASV now occupies. 15 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 Note 5 - Stockholder Loans Payable Stockholder loans payable consist of the following: Unsecured 10% loan payable to MGZ International Corp., a minority stockholder. Principal is due May 2002. Interest only is payable quarterly $219,000 Unsecured, non-interest bearing loan from Pacificom 65,500 Unsecured, non-interest bearing demand loan payable to MGZ 157,467 -------- Total 441,967 Less current portion 157,467 -------- Stockholder loans payable - net of current portion $284,500 ======== In conjunction with the loans payable to MGZ described above, ASV granted the note holder the option to convert the principal amount of the note into as many as one million shares of the Company's common stock at a conversion price of $0.50 per share. The note holder may exercise it option to convert through February 2002. 16 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 NOTE 6 - Commitments and Contingencies Employment contract Effective September, 1998, ASV entered into an employment contract with the company's President. The contract is for a 5 year period and provides for annual compensation of $98,000. As of March 31, 2001, accounts payable includes $ 00 of unpaid compensation due to the Company's President and to other employees. During the quarter ended March 31, 2001, the Company issued 2,940,000 shares of common stock to the president value at $105,840 in partial payment of the amounts due him. On December 30, 2000, the Board of Directors of ASV granted the President and Secretary of the Company options to purchase shares of common stock of the Company on account of accrued salaries owed to them at the agreed rate of 50% of the bid price at the time the options are exercised. For financial statement purposes additional compensation expense of $26,840 was recorded for the total number of shares of stock issuable at the grant date valued at the closing price of the stock less a 40% discount due to the lack of marketability and other factors. Deposit on land During the year ended June 30, 2000 the Company placed a $5,000 deposit on the purchase of a tract of land near Utica, New York. The land is to be utilized in the establishment of a food processing plant. Consulting Agreement During April 2000, ASV entered into a consulting agreement with MGZ International Corp. ("MGZ"), a minority stockholder. Under the terms of the agreement, MGZ is entitled to an $80,000 fee upon the acquisition of the business of CGI as described in note 3. Since the acquisition has not been consummated as of March 31, 2001, no consulting fees have been recorded by ASV. 17 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 NOTE 6 - Commitments and Contingencies(continued) Loan Agreement During February 2000, ASV entered into a loan agreement with Pacificom ("Pacificom"). Under the terms of the agreement, Pacificom agreed to loan ASV up to $1 million at 11% interest with unpaid principal and interest due on demand. The agreement is secured by 1 million shares of ASV's common stock which was pledged by MGZ, a minority stockholder. In addition, the lender received the option to purchase up to 1 million shares of ASV's common stock at $0.10 per share. Such options may be exercised during the month of December 2000. ASV also has the right to acquire up to 900,000 of the options from Pacificom at a purchase price of $0.10 per share at any time prior to December 2000. Since the full amount of the note was not funded, the parties are seeking to resolve the matter and have entered in to a "stand-still" agreement until June 30, 2001. The parties have agreed to use their best efforts to resolve this matter prior to June 30, 2001. It should be noted that the company has only acknowledged receipt of $394,000. Pacificom made only $65,500 of direct loans to ASV. Pacificom advanced funds to MGZ. Such funds were used by MGZ to make $376,000 of loans to ASV. Accordingly, the total outstanding obligation of ASV is the loan payable to MGZ described in note 5. ASV, MGZ and Pacificom are currently negotiating a revision to the original loan agreement that would recognize that ASV would have no direct indebtedness to Pacificom. ASV's management and legal counsel believe that such revision will be effected on terms satisfactory to ASV. 18 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 NOTE 6 - Commitments and Contingencies(continued) Management Agreement Effective February 1, 2000, ASV entered into an agreement with Hannelore Gourmet Foods, Ltd. ("Hannelore"), a wholly-owned subsidiary of CGI (see note 4) to manage Hannelore's business and finances. The agreement is for a one-year period ending January 31, 2001, but may be terminated by either party upon 30-day written notice. ASV is to be paid 50% of the profits of Hannelore at the end of the contract. The Company has not recorded any management revenue during the nine months ended March 31, 2001. Litigation ASV is involved in two legal matters arising out of the demised premises utilized by the company to operate the food processing and food distribution business of CGI and it wholly owned subsidiary Hannelore. The first matter is a litigation, which involves a claim by 247 Broadway, LLC as Landlord for back rent and an Order of Eviction of the Tenant. The Company was granted a motion to dismiss the summary proceeding of 247 Broadway, LLC based upon the fact that in October, 2000, 247 Broadway, LLC lost title to the property through a foreclosure action by the mortgagee. That motion is before the court . Subsequent to October, the mortgagee having obtained title to the building through its foreclosure action, commenced a summary proceeding against the company to evict. The mortgagor has moved for a re-argument of the court's decision. Management believes that it will resolve this matter without it having a material impact upon the Company. In addition, the mortgage holder on the demised premises has obtained a Judgment of Foreclosure against 247 Broadway, LLC and Hannelore Gourmet Foods as the guarantor of said mortgage obligation. On October 23, 2000, a Mortgage Foreclosure Sale occurred and the premises reverted back to the mortgagee. The Company is in negotiations with the mortgage holder and believes that it will be able to acquire the property or enter into a long-term lease in order to continue its operations at the demised premises with the mortgage holder now that it has taken repossession of the property from 247 Broadway, LLC. 19 AMERICA'S SPORTS VOICE, INC. AND SUBSIDIARY Notes to the Consolidated Financial Statements Three Months and Nine Months Ended March 31, 2001 and 2000 NOTE 6 - Commitments and Contingencies(continued) During the year ended June 30, 2000, ASV instituted a legal action against First Capital, Inc., a Florida stock brokerage firm. The action seeks the return of 600,000 shares of ASV's common stock which were issued to First Capital for services to be rendered in connection with promotion of the Company's stock. ASV alleges that such services were never provided. While the outcome of this matter cannot be determined at this time, in the opinion of management, the matter will ultimately be resolved on terms favorable to the Company. 20 ASPV SEC Filings Management Discussion: Investor - America's Sports Voice Inc. First Fiscal Quarterly Report (SEC form 10Q) ITEM 1. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION, RESULTS OF OPERATIONS and PROPOSED ACQUISITIONS The following discussion should be read in conjunction with the America's Sports Voice, Inc.'s (the "Company" or "ASV") financial statements and notes thereto included herein. In connection with, and because it desires to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the Company cautions readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on the behalf of the Company, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, the Company. The Company disclaims any obligation to update forward-looking statements. The Company through its subsidiary Gourmet Cuisine, Corp. has completed its third quarter of operation with revenues of $604,387 during the six-month period ended March 31, 2001. The Company did not have any operating income in the prior year. The Company's revenues are being generated from its food processing line of business. During the current quarter the Company had revenue of $110,406 and incurred $138,892 in selling, general and administrative expenses and $26,840 in stock compensation. This resulted in a net loss of .03 per share, versus a loss of .07 per share in the prior year quarter. (The Company has outstanding loans to Hannelore Gourmet Foods, LTD. of $231,308 this loan was part of the money the Company used to purchase Finova Capital's, position plus operating capital.) ITEM 2. Plan of Operation In addition to its food processing business, the Company intends to expand its scope of operation into information to market the benefits, not only of gourmet foods but diet foods, prepare the communication field as well as its present operation of food processing. The Company has entered into a contract to purchase ninety-eight (98%) of a company called 21 UkaPage in Kiev pending a two year audit by Ernst & Young. In addition, the Company will acquire One Hundred (100%) of a communication company in Louisiana. The aquision would be for Six Million (6,000,000) shares of unregistered common stock with restrictions. These companies have a combined income of Two Million ($2,000,000) dollars and a net profit of One Hundred and Twenty Thousand ($120,000). UkaPage has a license to install fiber optic cable in twenty-eight cities in the Ukraine and is the primary reason our Company pursed the aquission. Therefore, the Company anticipates revenues not only from its present contracts within the Food Industry, and in addition from the communication industry as well. ASV has targeted a national and international audience to market its various products from foreign airlines to international Internet companies. The Company's target market. The food processing company, Gourmet Cuisine Corp. has unlimited potential and needs to developed it's own product for Home Meal replacement catalog to start marketing it's merchandise. This is in addition to the 500 recipes that Gourmet Cuisine Corp. has acquired the rights to and were created by the world famous Master Chef, Gerhard Daniel. ITEM 3. ASV intends to develop a multi-media platform for its food-oriented projects. In this regard, ASV is currently in negotiations with a television production company, Internet service provider and a renowned comedian and movie star to become a spokesperson on behalf of the Company. These negotiations involve the production and filming of a unique broadcast of a new concept that will capitalize on a proven trend of direct selling to the consumer. In addition, ASV intends to produce an infomercial, which will consist of, " The Nutritional Gourmet" doing interviews and call-ins. It is anticipated, although no agreement has been executed with cable networks, that this broadcast will be available through various cable networks and the Company's website. The Company believes that with the combined Infomercial and Internet distribution, the Company will reach more of its target markets. ITEM 4. Management believes that it is extremely important to build ASV's brand image, which should enable the Company to attract an additional stream of income from sales revenues as the Company's concept is accepted and grows. The advertising and marketing campaign will blanket targeted markets promoting the Company's brand name in the consumer marketplace. ITEM 5. In addition to the Company's forgoing marketing plans, the Company intends to market to other companies who are interested in marketing either their products, services or food to their members. The Company plans to private label and/or co-pack for various food companies, consumer driven businesses such as hotels and casinos. The Company intends to use its website to notify accounts of new locations to receive discounts on goods, services and food. The website will hold a multitude of pricing and items processed daily so the accounts will have an interest to check the site often, even 22 multiple times daily from home or office quickly and easily. This traffic visiting the Company's website will act as an incentive for potential advertisers to market their goods to the website's visitors. The Company intends to change the content of the website daily and in some cases, prices will be updated multiple times throughout the day. ITEM 6. The Company anticipates that it will require an infusion of additional capital, from outside sources, to accomplish its business objectives described herein. The Company believes that its present anticipated revenues from operations would not be sufficient to fund operations based upon its business objectives. There can be no assurance that such funds will be available, in which case, the Company may have to scale back its business objectives and planned operations. ITEM 7. The Company requires additional funding in order to effectuate its business plan. There is no assurance such funds will become available. Further, it is anticipated that any such funding so obtained will result in significant dilution of existing shareholders. The inability to obtain sufficient funds from operations and external sources when needed would have a material adverse affect on the Company's business, results of operations and financial condition. Subsequent Event In May 2000, the Company through its acquisition of Finova Capital Corporation's ("Finova") secured position acquired Gourmet Cuisine International, Ltd., a privately held company and its three wholly owned subsidiary companies, including, Hannelore Gourmet Foods, LTD. (Hereinafter jointly referred to as "GCI") The Company initially received an assignment of FINOVA's security interest, which was a first security interest in all of the assets of GCI as security for a loan with a principal balance of $1,228,000 at the time the relevant note was acquired by the Company. The Company paid an aggregate of $219,000 to fund. (See notes in financial section). Pursuant to its' rights as the secured creditor the Company is taking the steps to foreclose on GCI and assume all of the assets, equipment, inventory, receivable and clients of GCI. At the time the Company purchased the Finova security interest, the Company also executed an agreement to purchase the stock of the principals of GCI; however, the Company based upon substantial misrepresentation proffered said primary the Company has sought to rescind the agreement. The Company has commenced an action in Supreme Court, Westchester County to rescind this agreement and obtain damages from the two principals. The Company will also pursue the repayment of the $1,228,000 note that was personally guaranteed by the principals. The Company is also negotiating with the mortgagor to purchase the building directly from said mortgagor. In October 2000, the mortgagee obtained title to the property and building through a foreclosure sale based upon a judgment of foreclosure. The Company has obtained, on February 5, 2001, a motion to dismiss the mortgagor's action for 23 summary proceeding with this Court recognizing the Company rights to the existing lease. The mortgagor has moved for rearguement of the decision. The action is still pending in Landlord Tenant Court of Suffolk County, New York. In order to obtain the $219,000 necessary to acquire the security interest, the Company obtained a loan from a minority shareholder in such amount. The terms of this loan included interest accruing at the rate of 10% per annum, which loan is due and payable two years from issuance. The relevant note requires that interest only be paid during the two-year term of the note, which interest is payable quarterly. (see financial notes) Liquidity and Capital Resources The Company presently has nominal cash or cash equivalents. However, the Company has obtained agreement from key management to defer or reduce their salaries for the present time. The President of the Company has agreed to waive any salaries due, pursuant to his employment agreement with the Company, until such time as the Company begins generating revenues from operations. The board has granted the president and secretary the option to receive 144 stock as compensation for their back salaries if they elect. In January of 2001 the Present of the company excerised his option and received additional stock as part of his compensation. (see stock aquiersion) 24

AMERICAS SPORTS VOICE INC /NY 10-Q/A