10-Q 1 ten2002b.txt U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED June 30, 2002. STRATEGIC PARTNERS, INC. COMMISSION FILE NO. 333-95485 A Wyoming Corporation EIN: 77-0494696 3525 Sunset Lane Oxnard, Calif. 93035 Telephone: 805-984-0821 Fax: 805-984-2764 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes No X The number of common shares issued and outstanding as of June 30, 2002 was 864,000. This report form is not filed as a transitional format. Total sequentially numbered pages in this document: 16 1 TABLE OF CONTENTS PART 1 - FINANCIAL INFORMATION Item 1 - Financial Statements Balance Sheets.......................................3 Statements of Operations.............................4 Statements of Stockholders' Equity (Deficit).........5 Statements of Cash Flows............................11 Notes to the Financial Statements...................12 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations.......15 PART II - OTHER INFORMATION Item 6 - Exhibits and Reports on Form 8-K...............16 Signatures.........................................16 2 ITEM 1 - Financial Information STRATEGIC PARTNERS, INC. (A Development Stage Company) Balance Sheets June 30, December 31, 2002 2001 (Unaudited) ASSETS CURRENT ASSETS Cash $ 350 $ 18,475 ------ ------ Total Current Assets 350 18,475 ------ ------ FIXED ASSETS, NET (Note 2) 5,610 6,416 ------ ----- TOTAL ASSETS $ 5,960 $ 24,891 ======= ====== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Accounts payable-Related Party (Note 4) $ 171,220 $ 136,121 ------- ------- Total Current Liabilities 171,220 137,367 ------- ------- STOCKHOLDERS' EQUITY (DEFICIT) Common stock, $0.001 par value; 10,000,000 shares authorized; 864,000 and 833,400 shares issued and outstanding, respectively 865 833 Additional paid-in capital 1,174,219 1,112,650 Stock subscription Deficit accumulated during the development stage (1,340,344) (1,225,959) -------- ------- Total Stockholders' Equity (Deficit) (165,260) (112,476) --------- ------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 5,960 $ 24,891 ========= =======

STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Operations (Unaudited) From Inception on For the Six For the Three September 25, Months Ended Months Ended 1998 Through June 30, June 30, June 30, 2002 2001 2002 2001 2002 REVENUES $ - $ - $ - $ - $ - EXPENSES General and administrative 110,724 60,372 56,884 19,691 1,328,091 ------- ------ ------- ------- --------- (LOSS) FROM OPERATIONS (110,724) ( 60,372) (56,884) (19,691) (1,328,091) ------- -------- -------- ------- --------- OTHER INCOME (EXPENSE) Interest expense (3,675) - (1,862) - (14,438) Miscellaneous income 14 - - - 2,185 ------ ------ ------- ------- -------- Total Other Income (Expense) (3,661) - (1,862) - (12,253) ------ -------- -------- -------- --------- NET (LOSS) $ (114,385) $( 60,372) $(58,746) $ (19,691) $(1,340,344) ======== ======== ======= ======= ========== BASIC (LOSS) PER SHARE $(0.13) $(0.08) $(0.07) $(0.02) ====== ====== ====== ======

STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) c> Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage At Inception on September 25, 1998 - $ - $ - $ - Common stock issued for services at $1.00 per share, October 9, 1998 215,000 215 214,785 - Common stock issued for cash at $1.00 per share, October 12, 1998 2,000 2 1,998 - Common stock issued for cash and services at $1.00 per share, October 13, 1998 4,000 4 3,996 - Common stock issued for services at $1.00 per share, October 19, 1998 5,000 5 4,995 - Common stock issued for cash and services at $1.00 per share, October 30, 1998 10,000 10 9,990 - Common stock issued for cash at $1.00 per share, November 17, 1998 6,000 6 5,994 - Common stock issued for cash at $1.00 per share, November 24, 1998 3,000 3 2,997 - Common stock issued for cash, services and expenses at $1.00 per share, December 8, 1998 21,000 21 20,979 - Less stock offering costs - - (534) - Net (loss) for the period ended December 31, 1998 - - - (264,556) ------ ------ ------ ------- Balance, Dec. 31, 1998 266,000 266 265,200 (Mm264,556) Common stock issued for expenses at $1.00 per share, January 5, 1999 300 - 300 - Common stock issued for cash and services at $1.00 per share, January 16, 1999 12,500 13 12,487 - Common stock issued for cash at $1.00 per share, January 20, 1999 20,000 20 19,980 - Common stock issued for cash at $1.00 per share, February 3, 1999 1,000 1 999 - Common stock issued for cash at $1.00 per share, February 15, 1999 2,200 2 2,198 - -------- ------- ------- -------- Balance Forward 302,000 $ 302 $ 301,164 $ (264,556) STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) (Continued) Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage Balance Forward 302,000 $ 302 $ 301,164 $ (264,556) Common stock issued for cash at $1.00 per share, February 22, 1999 2,000 2 1,998 - Common stock issued for cash at $1.00 per share, March 12, 1999 6,400 6 6,394 - Common stock issued for cash and services at $1.00 per share, March 26, 1999 27,500 27 27,473 - Common stock issued for cash at $1.00 per share, May 10, 1999 1,000 1 999 - Common stock issued for cash and services at $1.00 per share, May 19, 1999 6,000 6 5,994 - Common stock issued for services at $1.00 per share, July 12, 1999 2,000 2 1,998 - Common stock issued for services at $1.00 per share, July 27, 1999 1,600 2 1,598 - Common stock issued for cash and services at $1.00 per share, August 3, 1999 1,000 1 999 - Common stock issued for services at $1.00 per share, August 10, 1999 1,500 2 1,498 - Common stock issued for cash at $1.00 per share, September 17, 1999 12,500 12 12,488 - Common stock issued for cash and services at $1.00 per share, October 1, 1999 193,500 194 193,306 - Common stock issued for cash and services at $1.00 per share, October 26, 1999 11,000 11 10,989 - Common stock issued for services at $1.00 per share, October 29, 1999 1,000 1 999 - Less stock offering costs - - (8,600) -

STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) (Continued) Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage Net (loss) for the year ended December 31, 1999 - - - (364,608) -------- ----- -------- -------- Balance, December 31, 1999 569,000 $ 569 $ 559,297 $ (629,164) --------- ------- ---------- ------------ Common stock issued for cash at $ 2.00 per share May 22, 2000 (unaudited) 29,000 29 57,971 - Common stock issued for cash at $ 2.00 per share May 25, 2000 (unaudited) 5,000 5 9,995 - Common stock issued for cash at $ 2.00 per share June 1, 2000 (unaudited) 2,000 2 3,998 - Common stock issued for cash at $ 1.00 per share June 3, 2000 (unaudited) 5,000 5 4,995 - Common stock issued for cash at $ 2.00 per share June 15, 2000 (unaudited) 1,000 1 1,999 - Common stock issued for cash at $ 2.00 per share June 23, 2000 (unaudited) 1,000 1 1,999 - Common stock issued for debt at $1.00 per share June 30, 2000 (unaudited) 7,500 8 7,492 - Common stock issued for debt at $1.00 per share July 19, 2000 (unaudited) 2,500 2 2,498 - Common stock issued for services at $2.00 per share July 19, 2000 (unaudited) 500 1 999 - Common stock issued for cash at $2.00 per share July 24, 2000 (unaudited) 2,000 2 3,998 - Common stock issued for debt at $1.00 per share July 31, 2000 (unaudited) 12,500 12 12,488 - Common stock issued for debt at $1.00 per share August 2, 2000 (unaudited) 6,000 6 5,994 - Common stock issued for debt at $1.00 per share August 3, 2000 (unaudited) 6,000 6 5,994 - Common stock issued for cash at $2.00 per share August 30, 2000 (unaudited) 1,000 1 1,999 - STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) (Continued) Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage Common stock issued for debt at $1.00 per share Sept. 1, 2000 (unaudited) 13,200 13 13,187 - Common stock issued for debt at $1.00 per share Sept. 16, 2000 (unaudited) 15,000 15 14,985 - Common stock issued for cash at $2.00 per share Sept. 20, 2000 (unaudited) 5,000 5 9,995 - Common stock issued for cash at $2.00 per share Sept.27, 2000 (unaudited) 3,000 3 5,997 - Common stock issued for services at $2.00 per share Sept. 28, 2000 (unaudited) 500 1 999 - Common stock issued for debt at $1.00 per share Sept. 29, 2000 (unaudited) 2,500 2 2,498 - Common stock issued for debt at $1.00 per share Sept. 30, 2000 (unaudited) 1,000 1 999 - Common stock issued for debt at $ 1.00 per share December 5, 2000 19,000 19 37,981 - - Conversion of debt to equity below market - - 71,200 - - Common stock issued for cash at $ 1.425 per share December 7, 2000 58,800 59 83,731 (33,790) - Issuance of common stock below market - - 33,810 - - Accrued interest payable forgiven upon conversion of debt to equity - - 3,514 - - Net (loss) for the year ended December 31, 2000 - - - 328,483 --------- -------- -------- -------- -------- Balance, December 31, 2000 768,000 $ 768 $ 960,611 $(33,790) (957,747) Common stocks issued for cash at $2.00 per share March 14, 2001 20,000 20 40,000 Stocks subscription received 33,790 Issuance of common stock below market - - 24,102 STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) (Continued) Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage Common stocks issued For cash at $2.00 per Share, April 16, 2001 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, April 30, 2001 6,000 6 11,994 Common stocks issued For cash at $2.00 per Share, May 15, 2001 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, June 1, 2001 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, June 21, 2001 2,000 2 3,998 Common stocks issued For cash at $2.00 per Share, July 31, 2001 9,000 9 17,991 Common stocks issued For cash at $2.00 per Share, August 31, 2001 8,000 8 15,992 Common stocks issued For cash at $2.00 per Share, September 30, 2001 7,000 7 13,993 Common stocks issued For cash at $2.00 per share, October 16, 2001 7,000 7 13,993 Common stocks issued For cash at $2.00 per share, November 26, 2001 1,000 1 1,999 Common stocks issued for cash at $2.00 per share, December 3, 2001 1,000 1 1,999 Net (loss) for year ended (268,212) December 31, 2001 Prior year adjustment 1,400 1 -------- ----- ---------- ----- ----------- Balance December 31, 2001 833,400 $ 833 $1,112,651 $ - $(1,225,959) Common stocks issued For cash at $2.00 per Share, February 27, 2002 4,000 4 7,996 Common stocks issued For cash at $1.00 per Share, February 27, 2002 600 1 599 Common stocks issued For cash at $2.00 per Share, March 1, 2002 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, March 13, 2002 1,000 1 1,999 STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Stockholders' Equity (Deficit) (Continued) Deficit Accumulated Additional During the Common Stock Paid-In Development Shares Amount Capital Stage Common stocks issued For cash at $2.00 per Share, March 18, 2002 2,000 2 3,998 Common stocks issued For cash at $2.00 per Share, March 19, 2002 2,000 2 3,998 Common stocks issued For cash at $2.00 per Share, March 23, 2002 3,500 4 7,996 Common stocks issued For cash at $2.00 per Share, March 28, 2002 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, April 2, 2002 2,000 2 3,998 Common stocks issued For cash at $2.00 per Share, April 9, 2002 4,000 4 7,996 Common stocks issued For cash at $2.00 per Share, April 16, 2002 2,000 2 3,998 Common stocks issued For cash at $2.00 per Share, April 30, 2002 5,000 5 9,995 Common stocks issued For cash at $2.00 per Share, May 7, 2002 1,000 1 1,999 Common stocks issued For cash at $2.00 per Share, June 10,2002 2,000 2 3,998 Net loss for June 30, 2002 (114,385) -------- ----- ---------- ---------- Balance at June 30, 2002 864,500 $ 865 $ 1,174,219 $(1,340,344) ======== ==== ========== ==========

STRATEGIC PARTNERS, INC. (A Development Stage Company) Statements of Cash Flows (Unaudited) From Inception Sept. 25,1998 For the Three Months Through Ended June 30, June 30, 2002 2001 2002 ----------- ---------- ------------ CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ (58,746) $ (55,639)$(1,340,344) Adjustments to reconcile net loss to net cash (used) by operating activities: Depreciation 403 403 2,454 Common stock issued for services - - 438,300 Stocks issued below market 129,112 Changes in operating assets and liabilities: Increase (decrease)in accounts payable 12,100 20,754 171,220 ------ ------ ------- Net Cash (Used) by Operating Activities (46,243) (31,482) (599,258) ------- ------- --------- CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Fixed Assets - - (8,064) ------- ------- -------- Net Cash (Used) by Investing Activities - - (8,064) ------- ------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from notes payable - - 71,200 Issuance of common stock for cash 32,000 27,600 511,816 Stocks subscriptions payment - - 33,790 Stock offering costs - - (9,134) ------- -------- ------- Net Cash Provided by Financing Activities 32,000 27,600 607,672 ------- ------- ------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (14.243) ( 3,882) 350 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 14,593 18,475 - -------- ------- ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 350 $14,593 $ 350 ======= ======== ======= Cash Paid For: Interest $ - $ - $ - Income taxes $ - $ - $ - NON-CASH FINANCING ACTIVITIES Common Stock Issued for conversion of debt - 71,200 Common Stock Issued for services 438,300

STRATEGIC PARTNERS, INC. (A Development Stage Company) Notes to the Financial Statements June 30, 2002 NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Strategic Partners, Inc. (a development stage company) (the Company) was organized under the laws of the State of Wyoming on September 25, 1998. The purpose of the Company is to engage in the business of investment banking. The Company has had no active operations from inception. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Accounting Method The Company's financial statements are prepared using the accrual method of accounting. The Company has elected a December 31 year end. b. Advertising Advertising costs are expense as incurred. Advertising expense totaled $26,895 for the year 2001. c. Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. d. 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 at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. e. Revenue Recognition Policy The Company currently has no source of revenues. 12 STRATEGIC PARTNERS, INC. (A Development Stage Company) Notes to the Financial Statements (continued) June 30, 2002 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) f. Basic Loss Per Share Net loss per share is provided in accordance with Statement of Financial Accounting Standards No. 128 "Earnings Per Share". Basic loss per share reflects the amount of losses for the period available to each share of common stock outstanding during the reporting period, while giving effect to all dilutive potential common shares that were outstanding during the period, such as stock options and convertible securities. As of June 30, 2002, the Company had no issuable shares qualified as dilutive The following is an illustration of the reconciliation of the numerators and denominators of the basic loss per share calculation: For the three months June 30, 2002 2001 Net loss (numerator) $ (56,884) $(55,636) Weighted average shares outstanding (denominator) 843,258 839,844 Basic loss per share $ (0.07) $ (0.06) ======== ======== g. Fixed Assets Fixed assets are recorded at cost. Major additions and improvements are capitalized. Minor replacements, maintenance and repairs that do not extend the useful life of the assets are expensed as incurred. Depreciation of property and equipment is determined using the straight line method over the useful lives, primarily from 5 to 7 years. Property and equipment consisted of the following at: June 30, June 30, 2002 2001 Office equipment $ 8,064 $ 8,064 Accumulated depreciation (2,451) (2,051) ------ ------ $ 5,610 $ 6,013 ======= ====== Depreciation expense for the three months ended June 30, 2002 and 2001 was $403 and $403, respectively. h. Unaudited Financial Statements The accompanying unaudited financial statements include all of the adjustments which, in the opinion of management, are necessary for a fair presentation. Such adjustments are of a normal recurring nature. 13 STRATEGIC PARTNERS, INC. (A Development Stage Company) Notes to the Financial Statements (continued) June 30, 2002 NOTE 3 - RELATED PARTY TRANSACTIONS Office Space The Company pays rent of $ 1,100 per month on a month-to-month basis for office space in the personal residence of a related party. Rent expense for the three months ended June 30, 2002 and 2001 was $3,300 and $3,300, respectively. Accounts Payable Accounts payable consist of unpaid consulting expenses for Chief Executive Officer in the amount of $171,220 at June 30, 2002. Employment Agreements During October 1999, the Company signed an employment contract with its Chief Executive Officer, whereby, the Company agreed to pay him $150,000 per year for five years. Compensation expense associated with this contract amounted to $150,000 for the year ended December 31, 2001. The Company agreed to pay its Secretary $2,500 per month as compensation. Compensation expense associated with this agreement amounted to $7,500 for the three months ended June 30, 2002. NOTE 4 INCOME TAXES The Company has a net operating loss carryover at December 31, 2001 of approximately $1,225,959 which begin to expire in 2020. The potential tax benefit of the loss carryover has been offset by a valuation allowance of the same amount. NOTE 5 - GOING CONCERN The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established revenues sufficient to cover its operating costs and allow it to continue as a going concern. It is the intent of the Company to earn revenues from investment banking services. Until sufficient revenues are earned to operate profitably, management intends to issue additional shares of its common stock for cash, services, or expenses paid on behalf of the Company. 14 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. We are a development stage company without significant assets or clients. We were formed to engage in the business of providing consulting services to companies with respect to finance, mergers, acquisitions, raising capital in the public markets and marketing on the internet. We registered an initial public offering consisting of 300 units at $ 2,000 per unit. This registration statement was renewed in October, 2000 and continues through November, 2002. A copy of the prospectus may be obtained on our web site under "stock offer". Our website address is www.strategic-partners-inc.com. Pending conclusion of this offering we have limited liquidity and capital resources. We have not yet begun operations Besides continuing our public offering we are investigating potential investments and seeking new clients. The primary goal is to have sufficient cash to employ support staff that will compliment the sales efforts of our officers and directors. With quality employees we will be able to carry out business in a profitable manner. The first milestone we hope to achieve with this offering is the raising of at least $300,000. If the maximum units are sold we will lease offices and purchase adequate equipment to facilitate full scale operations. The budget is set forth in the use of proceeds section of the prospectus. The second milestone is to generate income from fees of not less than $300,000 for the first year following the conclusion of the offering. This level of income will allow us to continue in business and expand on this client base. We have identified potential clients that will generate fee income allowing us to achieve our financial objectives. 15 PART II - OTHER INFORMATION ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K (b) There were no reports filed by us on Form 8-K for the quarter ended June 30, 2002. SIGNATURES In accordance with the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. STRATEGIC PARTNERS, INC. Dated: 8/14/2002 ------- By: /s/ Frank J. Weinstock --------------------------------- Frank J. Weinstock, President, Director, Chief Executive Officer By: /s/ Richard D. Spencer --------------------------------- Richard D. Spencer, Director, Chief Financial Officer 16

STRATEGIC PARTNERS INC 10-Q