8-K 1 v018693_8-k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 OR 15(d) of the Securities and Exchange Act of 1934 Date of Report (Date of earliest reported): May 17, 2005 Wireless Frontier Internet, Inc. (Exact name of registrant as specified in charter) Delaware 000-08281 75-28904059 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 104 West Callaghan, Fort Stockton, Texas 79735 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (432) 336-0336 SECTION 5. CORPORATE GOVERNANCE AND MANAGEMENT Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers On May 12, 2005, the company released a press release announcing the restructuring and reduction of employees as an attempt to lower costs. Included in the reduction was the resignation of the company's Chief Financial Officer, Kelly Simmons. Mr. Simmons has agreed to consult with the company on an as-needed basis. See exhibit 99 SECTION 7. OTHER EVENTS Item 7.01 Other Events On May 12, 2005, the company released a press release announcing the company is late on its Form 10-KSB for fiscal year ended December 31, 2004 and that the annual audit for the same period is not complete. See exhibit 99 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. WIRELESS FRONTIER INTERNET, INC. Date: May 18, 2005 /s/ Alex J. Gonzalez ------------------- Alex J. Gonzalez CEO

------------------ ---------------- ---------------- --------------------------------- --------------------------------- Annual Compensation Long Term Compensation ------------------ ---------------- ---------------- --------------------------------- --------------------------------- Name and Year Salary Bonus Other Annual Securities All Other Principal Compensation Underlying Compensation Position Options ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Alex Gonzalez, 2002 $91,750 $10,000 $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Chairman and 2001 $50,176 $-- $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Chief Executive 2000 -- $-- $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Officer ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Jasper Knabb, 2002 $-- $-- $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- President and 2001 $-- $-- $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Director 2000 $-- $-- $-- -- $-- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------

ASSETS 2002 2001 ------------ ------------ CURRENT ASSETS Cash $ 188,990 $ 94,331 Accounts receivable 136,824 35,418 Inventories 59,615 - ------------ ------------ Total Current Assets 385,429 129,749 FIXED ASSETS Equipment 621,079 539,832 Vehicles 47,520 47,520 ------------ ------------ 668,599 587,352 Less: Accumulated depreciation (233,610) (107,646) ------------ ------------ 434,989 479,706 OTHER ASSETS Goodwill 505,966 283,091 Covenants not to compete 10,000 5,000 ------------ ------------ 515,966 288,091 Less: Accumulated amortization (37,307) (7,517) ------------ ------------ 478,659 280,574 Shareholder receivables 15,779 11,679 ------------ ------------ 494,438 292,253 ------------ ------------ Total Assets $ 1,314,856 $ 901,708 ============ ============

LIABILITIES AND STOCKHOLDERS' EQUITY 2002 2001 ------------ ------------ CURRENT LIABILITIES Line of credits 246,110 67,696 Current portion of long - term debt 75,041 60,270 Accounts payable 27,084 337 Accrued payroll 17,675 7,923 Accrued interest 5,451 1,987 Accrued taxes 12,774 6,234 ------------ ------------ Total Current Liabilities 384,135 144,447 LONG - TERM DEBT Long - term debt 485,877 290,678 STOCKHOLDERS' EQUITY Common stock, 100,000,000 authorized 1,000 1,000 10,000,000 outstanding Additional contributed capital 664,316 664,316 Retained deficit (220,472) (198,733) ------------ ------------ 444,844 466,583 ------------ ------------ Total Liabilities and Stockholders' Equity $ 1,314,856 $ 901,708 ============ ============

2002 2001 ------------ ------------ REVENUES Equipment Sales Revenues $ 1,442,901 $ 1,107,164 Cost of sales 865,201 838,553 ------------ ------------ Gross profit equipment sales 577,700 268,611 Internet service Revenues 653,817 230,239 Cost of sales 281,533 59,234 ------------ ------------ Gross profit internet sales 372,284 171,005 ------------ ------------ TOTAL GROSS PROFIT 949,984 439,616 GENERAL AND ADMINISTRATIVE Advertising and promotion 19,199 7,406 Amortization and depreciation 155,754 114,656 Legal and professional 7,500 8,415 Auto and travel 58,057 41,850 Commissions and contract labor 14,702 69,692 Office expenses and supplies 52,967 25,213 Insurance 23,732 16,570 Interest 55,188 22,938 Rent 44,453 34,932 Repairs and maintenance 5,229 16,824 Salary and wages 434,618 187,001 Taxes 68,509 43,710 Utilities 39,885 20,893 ------------ ------------ 979,793 610,100 ------------ ------------ LOSS FROM OPERATIONS (29,809) (170,484) Other income 8,070 9,244 ------------ ------------ NET LOSS $ (21,739) $ (161,240) ============ ============

ADDITIONAL COMMON CONTRIBUTED RETAINED STOCK CAPITAL DEFICIT TOTAL ---------- ------------ ------------ ------------- BALANCE December 31, 2000 $ 1,000 $ 71,490 $ (37,493) $ 34,997 Contribution of West-Tex Internet - 592,826 - 592,826 Net Loss for 2001 - - (161,240) (161,240) ---------- ------------ ------------ ------------- BALANCE December 31, 2001 1,000 664,316 (198,733) 466,583 Net Loss for 2002 - - (21,739) (21,739) ---------- ------------ ------------ ------------- BALANCE December 31, 2002 $ 1,000 $ 664,316 $ (220,472) $ 444,844 ========== ============ ============ =============

2002 2001 ------------ ----------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the year $ (21,739) $ (161,240) Adjustments to reconcile net earnings to net cash provided (used) by operating activities: Depreciation 125,964 107,139 Amortization 29,790 7,517 Gain on sale of assets - (6,995) Changes in Current assets and liabilities: (Increase) in Accounts receivable (101,406) (35,418) (Increase) in Inventories (59,615) - Increase (Decrease) in Accounts payable 26,747 337 (Decrease) Increase in Accrued payroll 9,752 7,923 Increase in Accrued interest 3,464 1,987 Increase in Accrued taxes 6,540 6,234 ------------ ----------- NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 19,497 (72,516) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Fixed assets (81,247) (558,587) Proceeds from sale of Fixed assets - 23,182 Purchase of Goodwill (222,875) (283,091) Purchase of Covenant not to compete (5,000) (5,000) Increase in Shareholder receivables (4,100) (11,679) ------------ ----------- NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES (313,222) (835,175) CASH FLOWS FROM FINANCING ACTIVITIES Increase in Line of credit - net 178,414 67,696 Increase in Long - term debt 457,975 316,133 Payments on Long - term debt (248,005) (14,554) Increase in Additional contributed capital - 592,826 ------------ ----------- NET CASH USED BY FINANCING ACTIVITIES 388,384 962,101 ------------ ----------- NET INCREASE (DECREASE) IN CASH 94,659 54,410 CASH AT BEGINNING OF YEAR 94,331 39,921 ------------ ----------- CASH AT END OF YEAR $ 188,990 $ 94,331 ============ ===========

ASSETS 2003 ------------ CURRENT ASSETS Cash $ 192,233 Accounts receivable 873,441 Inventories 204,757 Prepaid expenses 98,276 ------------ Total Current Assets 1,368,707 FIXED ASSETS Buildings 375,000 Equipment 1,201,423 Vehicles 466,334 ------------ 2,042,757 Less: Accumulated depreciation (311,791) ------------ 1,730,966 OTHER ASSETS Goodwill 3,510,452 Covenants not to compete 10,000 ------------ 3,520,452 Less: Accumulated amortization (69,351) ------------ 3,451,101 Shareholder receivables 20,286 ------------ 3,471,387 Total Assets $ 6,571,060 ============

LIABILITIES AND STOCKHOLDERS' EQUITY 2003 ------------ CURRENT LIABILITIES Line of credits $ 230,654 Current portion of long - term debt 263,223 Accounts payable 326,902 Accrued payroll 64,121 Accrued interest 6,573 Accrued taxes 38,563 ------------ Total Current Liabilities 930,036 LONG - TERM DEBT Long - term debt 761,521 STOCKHOLDERS' EQUITY Common stock 100,000,000 shares authorized 1,603 16,026,579 shares outstanding, par value $0.0001 per share Additional contributed capital 5,238,145 Retained deficit (360,245) ------------ 4,879,503 Total Liabilities and Stockholders' Equity $ 6,571,060 ============ WIRELESS FRONTIER INTERNET, INC. STATEMENT OF INCOME For the Quarter and Six Months Ended June 30, 2003 Six Months Quarter Ended Ended June 30, June 30, 2003 2003 ------------ ------------ REVENUES Equipment Sales Revenues $ 677,130 $ 877,190 Cost of sales 310,725 492,677 ------------ ------------ Gross profit equipment sales 366,405 384,513 Internet service Revenues 653,512 932,608 Cost of sales 32,199 234,637 ------------ ------------ Gross profit internet sales 621,313 697,971 ------------ ------------ TOTAL GROSS PROFIT 987,718 1,082,484 GENERAL AND ADMINISTRATIVE Advertising and promotion 26,649 34,686 Amortization and depreciation 80,759 123,689 Legal and professional 57,425 59,390 Auto and travel 67,295 88,183 Commissions and contract labor 16,561 32,431 Office expenses and supplies 78,552 96,801 Insurance 22,156 36,126 Interest 28,123 32,397 Rent 8,426 36,147 Repairs and maintenance 4,040 6,043 Salary and wages 436,372 592,675 Taxes 81,391 96,180 Utilities 25,545 38,471 ------------ ------------ 933,294 1,273,219 ------------ ------------ LOSS FROM OPERATIONS 54,424 (190,735) Other income 40,846 50,962 ------------ ------------ NET INCOME/(LOSS) $ 95,270 $ (139,773) ============ ============ Average shares outstanding 15,235,455 15,070,561 Earnings/(Loss) per share $ 0.01 $ (0.01)

ADDITIONAL NUMBER OF COMMON CONTRIBUTED RETAINED SHARES STOCK CAPITAL DEFICIT TOTAL ------------ ------------ ------------ ------------ ------------ BALANCE December 31, 2002 14,906,000 $ 1,000 $ 664,316 $ (220,472) $ 444,844 Recapitalize for stock split - 491 (491) - - Shares sold 551,530 55 1,156,083 - 1,156,138 Kolinek acquisition 28,048 3 168,285 - 168,288 Strategic Abstract acquisition 104,166 10 628,986 - 628,996 Momuntum acquisition 436,835 44 2,620,966 - 2,621,010 Net Loss for six months - - - (139,773) (139,773) ------------ ------------ ------------ ------------ ------------ BALANCE June 30, 2003 16,026,579 $ 1,603 $ 5,238,145 $ (360,245) $ 4,879,503 ============ ============ ============ ============ ============

WIRELESS FRONTIER INTERNET, INC. STATEMENT OF CASH FLOWS For the Quarter and Six Months Ended June 30, 2003 Quarter Ended Six Months Ended June 30, June 30, ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the three months $ 95,270 $ (139,773) Adjustments to reconcile net earnings to net cash provided (used) by operating activities: Depreciation 57,815 91,645 Amortization 22,944 32,044 (Loss) on sale of assets (5,793) (5,793) Changes in Current assets and liabilities: Decrease (Increase) in Accounts receivable (651,825) (613,127) Decrease (Increase) in Inventories (153,805) (118,425) (Increase) in Prepaid expenses (98,276) (98,276) Increase (Decrease) in Accounts payable 240,880 222,026 Increase in Accrued payroll 12,702 22,269 Increase (Decrease) in Accrued interest 1 - Increase (Decrease) in Accrued taxes 12,168 7,898 ------------ ------------ NET CASH (USED) BY OPERATING ACTIVITIES (467,919) (599,512) CASH FLOWS FROM INVESTING ACTIVITIES Increase in Shareholder receivables (4,507) (4,507) Purchase of Fixed assets (750,706) (856,733) ------------ ------------ NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES (755,213) (861,240) CASH FLOWS FROM FINANCING ACTIVITIES Sale of Common stock 1,156,138 1,156,138 (Payments) Increase in Line of credit - net (146,110) (74,878) Increase in Long - term debt 309,699 404,199 Payments on Long - term debt (4,525) (33,517) ------------ ------------ NET CASH USED BY FINANCING ACTIVITIES 1,315,202 1,451,942 ------------ ------------ NET INCREASE (DECREASE) IN CASH 92,070 (8,810) CASH AT BEGINNING OF PERIOD 88,110 188,990 CASH ACQUIRED FROM MOMENTUM 12,053 12,053 ------------ ------------ CASH AT END OF PERIOD $ 192,233 $ 192,233 ============ ============

HISTORICAL Wireless Fremont Note Adjustments Combined ------------ ------------ ------------ ------------- ------------ ASSETS CURRENT ASSETS Cash $ 192,233 $ 532 1 $ (532) $ 192,233 Accounts receivable 873,441 - - 873,441 Inventories 204,757 - - 204,757 Prepaid expenses 98,276 - - 98,276 ------------ ------------ ------------- ------------ Total Current Assets 1,368,707 532 (532) 1,368,707 FIXED ASSETS Buildings 375,000 - - 375,000 Equipment 1,201,423 - - 1,201,423 Vehicles 466,334 - - 466,334 ------------ ------------ ------------- ------------ 2,042,757 - - 2,042,757 Less: Accumulated depreciation (311,791) - - (311,791) ------------ ------------ ------------- ------------ 1,730,966 - - 1,730,966 OTHER ASSETS Goodwill 3,510,452 - - 3,510,452 Covenants not to compete 10,000 - - 10,000 ------------ ------------ ------------- ------------ 3,520,452 - - 3,520,452 Less: Accumulated amortization (69,351) - - (69,351) ------------ ------------ ------------- ------------ 3,451,101 - - 3,451,101 Investments - 4,760 2,3,7 (4,760) - Shareholder receivables 20,286 - - 20,286 ------------ ------------ ------------- ------------ 3,471,387 4,760 (4,760) 3,471,387 ------------ ------------ ------------- ------------ Total Assets $ 6,571,060 $ 5,292 $ (5,292) $ 6,571,060 ============ ============ ============= ============ HISTORICAL Wireless Fremont Adjustments Combined ------------ ------------ ------------ ------------- LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Line of credits $ 230,654 $ - $ - $ 230,654 Current portion of long - term debt 263,223 - - 263,223 Accounts payable 326,902 355,891 1,5,6 (353,729) 329,064 Accrued payroll 64,121 - - 64,121 Accrued interest 6,573 - - 6,573

Accrued taxes 38,563 - - 38,563 ------------ ------------ ------------ ------------- Total Current Liabilities 930,036 355,891 (353,729) 932,198 LONG - TERM DEBT Long - term debt 761,521 - - 761,521 STOCKHOLDERS' EQUITY Common stock 100,000,000 shares authorized 1,603 5,947 3,4,5,7 15,970 23,520 23,520,104 shares outstanding, after merger par value $0.001 per share Additional contributed capital 5,238,145 1,500,029 3,5,7,8 (1,500,029) 5,238,145 Retained deficit (360,245) (1,856,575) 1,837,256 (379,564) Treasury stock - - 2 (4,760) (4,760) ------------ ------------ ------------ ------------- 4,879,503 (350,599) 348,437 4,877,341 ------------ ------------ ------------ ------------- Total Liabilities and Stockholders' Equity $ 6,571,060 $ 5,292 $ (5,292) $ 6,571,060 ============ ============ ============ =============

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