6-K 1 form6k_sep5-2003.txt FORM 6-K, MUNRO SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 6-K/A REPORT OF FOREIGN ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the period ended September 5, 2003 VERB EXCHANGE, INC. 000-30683 ------------------------------------------------- -------------------------- (Translation of Registrant's name into English) SEC File No. -------------------------------------------------------------------------------- (Former name) Suite 908, 1055 Dunsmuir Street, P. O. Box 49266, Vancouver, BC, Canada V7X 1L2 -------------------------------------------------------------------------------- (Address of principal executive offices) [Indicate by check mark whether the Registrant files or will file annual reports under cover of forms 20-F or Form 40-F.] Form 20-F X Form 40-F ------- -------- [Indicate by check mark whether the Registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act 1934.] Yes No X ------- ------- RESIGNATION OF KERRY MUNRO, VP MARKETING. Verb Exchange Inc. announces that Kerry Munro, VP Marketing, has left the company. Mr. Munro has, for personal reasons, decided to return to his marketing consulting practice. The position has been consolidated. Mr. Eric Hoover has been installed as Senior Vice President - Sales and Marketing. Mr. Hoover has extensive experience in both sales and marketing. 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, thereunto duly authorized. VERB EXCHANGE, INC. Date: September 8, 2003 By: /s/ David Ebert ------------------------------- David Ebert, Chief Financial Officer 2

--------------------------------------------------------------------------------------------------------- 30 Jun 2003 31 Dec 2002 --------------------------------------------------------------------------------------------------------- (Unaudited) (Audited) Assets Current Assets: Cash and cash equivalent $ 234,254 $ - Accounts receivable 167,848 108,814 Contracts receivable 264,097 - Goods and services tax receivable 27,251 45,934 Prepaid expenses 114,625 53,270 ------------------------------------------------------------------------------------------------------- 808,075 208,018 Technology, net of accumulated amortization of $2,467,517 2002 $1,938,763) 1,762,512 2,291,266 Fixed assets 197,202 177,723 Contracts receivable 200,091 - Other assets 34,839 40,972 --------------------------------------------------------------------------------------------------------- 3,002,720 2,717,979 Liabilities and Shareholders' Equity Current liabilities: Bank Overdraft - 36,387 Accounts payable and accrued liabilities 1,348,652 1,323,355 Demand loan 19,776 20,079 Due to Zwiss A.V.V 200,000 200,000 Deferred lease inducement 21,358 31,215 Deferred revenue 306,059 34,332 Current portion of capital lease obligation 18,592 31,697 ------------------------------------------------------------------------------------------------------- 1,914,436 1,677,065 Deferred revenue 200,091 - Capital lease obligation 17,051 9,871 Shareholders equity: Share capital (note 5) 8,785,466 8,032,910 Warrant (note 5) 4,539,352 4,539,352 Contributed surplus 412,866 412,866 Deficit (12,866,542) (11,954,085) ---------------------------------------------------------------------------------------------------- 1,071,234 1,031,043 --------------------------------------------------------------------------------------------------------- $ 3,002,720 $ 2,717,979 ---------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------- 3 Months Ended 3 Months Ended 6 Months Ended 6 Months Ended 30 Jun 2003 30 Jun 2002 30 Jun 2003 30 Jun 2002 ---------------------------------------------------------------------------------------------------------------------- (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue (note 6) $ 1,240,761 $ 21,430 $ 1,831,586 $ 49,455 Cost of Sales 526,386 19,342 720,443 53,042 ---------------------------------------------------------------------------------------------------------------------- Gross Margin 714,375 2,088 1,111,143 (3,587) Expenses: Amortization 281,253 280,208 558,400 560,416 Bad debt expense - - 29,422 - Communications 57,009 22,585 95,884 50,417 Foreign exchange loss (gain) 19,852 598 13,228 1,540 General and administrative 164,866 189,606 296,981 347,696 Bank Charges and Interest 25,590 11,088 41,828 16,663 Management fees 24,000 15,000 52,000 31,500 Professional and consulting fees 259,420 283,117 544,285 470,456 Salaries and wages 150,626 226,601 253,972 425,441 Travel 97,292 74,443 137,599 121,727 ----------------------------------------------------------------------------------------------------------------- 1,079,908 1,103,246 2,023,599 2,025,858 ---------------------------------------------------------------------------------------------------------------------- Loss for the period 365,534 1,101,158 912,457 2,029,445 Deficit, beginning of period 12,501,008 8,419,532 11,954,085 7,491,245 ---------------------------------------------------------------------------------------------------------------------- Deficit, end of period $12,866,542 $ 9,520,690 $ 12,866,542 $ 9,520,690 ---------------------------------------------------------------------------------------------------------------------- Loss per share: Basic 0.03 0.25 0.07 0.47 Diluted 0.03 0.25 0.07 0.47 ---------------------------------------------------------------------------------------------------------------------- Weighted average number of common stock: Basic 12,915,810 4,320,925 12,915,810 4,320,925 Diluted 12,915,810 4,320,925 12,915,810 4,320,925 ----------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------- 3 Months Ended 3 Months Ended 6 Months Ended 6 Months Ended 30 Jun 2003 30 Jun 2002 30 Jun 2003 30 Jun 2002 --------------------------------------------------------------------------------------------------------------------------------- (Unaudited) (Unaudited) (Unaudited) (Unaudited) --------------------------------------------------------------------------------------------------------------------------------- Cash provided by (used in): Operations: Loss for the period $(365,534) $(1,101,158) $(912,457) $(2,029,445) Items not involving cash: Amortization 281,253 280,208 558,400 560,416 Deferred lease inducement (4,928) - (9,857) - Deferred income 473,535 - 471,818 - Change in non-cash operating working capital: Accounts receivable (61,136) (2,558) (59,034) 3,052 Contracts receivable (464,188) - (464,188) - Goods and Services tax (27,251) (15,517) 18,683 (19,636) Prepaid expenses (61,355) (26,635) (61,355) (16,635) Accounts payable and accrued liabilities (238,650) 118,676 25,296 175,981 ---------------------------------------------------------------------------------------------------------------------------- (468,254) 794,656) (432,694) (1,373,939) Investing: Purchase of fixed assets (49,125) (609) (49,125) (33,914) Disposal of other assets 6,133 - 6,133 - (42,992) (609) (42,992) (33,914) Financing: Demand loan (303) - (303) (50,693) Due to Ayotte Music - 527,808 - - Common shares issued for cash 279,500 - 300,000 - Issuance of convertible debentures - 8,000 - 113,600 Cash received on acquisition of Millennium (Note 6) 244,361 - 244,361 - Cash received on acquisition of Lattice (Note 6) 208,195 - 208,195 - Change in capital lease obligations 1,419 810 (5,926) 15,448 733,172 584,290 746,327 1,203,835 Increase in cash and cash equivalents 221,926 (210,975) 270,641 (204,018) Cash and cash equivalents (bank indebtedness), beginning of period 12,329 151,882 (36,387) 144,925 --------------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents (bank indebtedness), end of period $ 234,254 $ (59,093) $ 234,254 $ (59,093) ---------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------ Number of shares Amount ------------------------------------------------------------------------------------------ Balance at December 31, 2001 2,898,800 $3,169,072 Issued for exercise of stock options 190,000 95,000 Issued on exercise of warrants 200,000 150,000 Issue of special warrants - 720,040 Balance at November 11, 2002 3,288,800 4,134,112 Adjustments to share capital to comply with recapitalization accounting 4,320,925 3,002,588 Issued for services rendered on capital transactions 1,050,000 472,500 Issued for cash 1,724,230 896,210 Share issue cost - (472,500) Balance at December 31, 2002 10,383,955 8,032,910 ------------------------------------------------------------------------------------------ Common shares issued for cash 1,500,000 300,000 Shares issued on exercise of special warrants 990,138 - Shares issued to Millennium shareholders 1,372,497 244,361 Shares issued to Lattice shareholders 1,201,076 208,195 ------------------------------------------------------------------------------------------ Balance at June 30, 2003 15,447,666 $8,785,466 ------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------- Outstanding options ------------------------------------------------------------------------------------- Number Exercise of shares price ------------------------------------------------------------------------------------- Balance at December 31, 2002 1,717,000 $ 0.50 Cancelled 155,000 $ 0.50 --------- ------- Balance at June 30, 2003 1,562,000 $ 0.50 ------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------- Weighted average Weighted Weighted Range of Number remaining average Number Average exercise prices outstanding contractual life exercise price exercisable exercise price --------------------------------------------------------------------------------------- $0.50 1,562,000 4.4 years $ 0.50 669,428 $ 0.50 ---------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------- Outstanding warrants --------------------------------------- Number Exercise of warrants price or range --------------------------------------------------------------------------------------------------- Balance at December 31, 2002 4,118,868 $0.35 to $7.41(US$5.00)

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