UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 2002
or
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 333-48312
AMERICAN LEISURE HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
FREEWILLPC.COM, INC.
(Former name of registrant)
Nevada 75-2877111
------ ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Park 80 Plaza East
Saddlebrook, New Jersey 07663
----------------------- -----
(Address of principal executive offices) (Zip Code)
(201) 226-2060
(Registrant's telephone number, including area code)
Check 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, and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
As of August 16, 2002, there were 6,685,974 shares of the
Registrant's common stock, par value $0.001 issued and outstanding.
AMERICAN LEISURE HOLDINGS, INC.
JUNE 30, 2002 QUARTERLY REPORT ON FORM 10-QSB
TABLE OF CONTENTS
Page Number
Special Note Regarding Forward Looking Information .............................................2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements ...........................................................................3
Item 2. Management's Plan of Operations................................................................11
PART II - OTHER INFORMATION
Item 1. Legal Proceedings..............................................................................13
Item 2. Changes in Securities and Use of Proceeds......................................................13
Item 3. Defaults Upon Senior Securities................................................................14
Item 4. Submission of Matters to a Vote of Security Holders............................................14
Item 5. Other Information..............................................................................15
Item 6. Exhibits and Reports on Form 8-K...............................................................16
References in this report to "we", "us", "our" and similar terms means
American Leisure Holdings, Inc., a Nevada corporation, formerly FreewillPC.com,
Inc.
1
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
The following cautionary statements identify important factors that
could cause our actual results to differ materially from those projected in the
forward-looking statements made in this Quarterly Report on Form 10-QSB. Any
statements about our beliefs, plans, objectives, expectations, assumptions or
future events or performance are not historical facts and may be
forward-looking. These statements are often, but not always, made through the
use of words or phrases such as "will likely", "are expected to", "should", "is
anticipated", "estimated", "intends", "plans", "projection" and "outlook". Any
forward-looking statements are qualified in their entirety by reference to
various factors discussed throughout this Quarterly Report and discussed from
time to time in our filings with the Securities and Exchange Commission. Among
the significant factors that could cause our actual results to differ materially
from those expressed in the forward-looking statements are:
o the potential risk of delay in implementing our business plan;
o the market for our travel and leisure services; and
o the need for additional financing.
Because the factors referred to above could cause actual results or
outcomes to differ materially from those expressed in any forward-looking
statements, persons should not place undue reliance on any of these
forward-looking statements. In addition, any forward-looking statement speaks
only as of the date on which it is made, and we undertake no obligation to
update any forward-looking statement or statements to reflect events or
circumstances after the date on which the statement is made, to reflect the
occurrence of unanticipated events or otherwise. New factors emerge from time to
time, and it is not possible for us to predict which will arise or to assess
with any precision the impact of each factor on our business or the extent to
which any factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements.
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Condensed Balance Sheets as of June 30, 2002 and December 31, 2001..............................4
Condensed Statement of Operations
for the six months ended June 30, 2002 and 2001 and three
months ended June 30, 2002 .....................................................................5
Statement of Stockholders' Equity and Accumulated Deficit
From June 13, 2000 to June 30, 2002 .........................................................6
Statement of Cash Flows
for the six months ended June 30, 2002 and from June 13, 2000 to June 30, 2001 ..............7
Notes to Interim Condensed Financial Statements.................................................8
3
FREEWILLPC.COM, INC.
CONDENSED BALANCE SHEETS
For the period from June 30, 2002 and year ended December 31, 2001
June 30, 2002 December 31, 2001
(Unaudited) (Audited)
--------------- -----------------
ASSETS
CURRENT ASSETS:
Cash $ 0 $ 4,957
Accounts receivable 0 13,093
Prepaid expenses 0 43,700
--------- ---------
Total current assets 0 61,750
PROPERTY AND EQUIPMENT:
Website (net amortization respectively) 0 4,722
--------- ---------
TOTAL ASSETS $ 0 $ 66,472
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable $ 0 $ 11,825
Loan - related party 3,119
---------
TOTAL LIABILITIES $ 14,944
STOCKHOLDERS' EQUITY
Common stock, $0.001 par value,
25,000,000 authorized, 4,600,000
and 4,580,000 shares issued and
outstanding at June 30, 2002 and
December 31, 2001 respectively 4,600 4,580
Additional paid-in-capital 102,537 96,056
Deficit accumulated during the
development stage (107,137) (49,108)
--------- ---------
Total Stockholders' Equity 0 51,528
--------- ---------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 0 $ 66,472
========= =========
See notes to unaudited condensed financial statements
4
FREEWILLPC.COM, INC.
CONDENSED STATEMENT OF OPERATIONS
Six months ended June 30, 2002 and 2001 and three
months ended June 30, 2002
Three months Six months Six months
ended ended ended
June 30, 2002 June 30, 2002 June 30, 2001
(Unaudited) (Unaudited) (Unaudited)
---------------- ----------------- ----------------
REVENUE:
Sales $ 0 $ 0 $ 4,242
COST OF SALES: 0 271 3,297
----------- ----------- -----------
GROSS PROFIT 0 (271) 945
OPERATING EXPENSE:
Depreciation and amortization 556 1,389 1,667
General and administrative 1,460 54,356 1,904
Impairment Loss 2,013 2,013 0
----------- ----------- -----------
Total Operating Expense 4,029 57,758 3,571
----------- ----------- -----------
NET LOSS ($ 4,029) ($ 58,029) ($ 2,626)
=========== =========== ===========
Weighted average shares outstanding 4,596,000 4,596,000 4,200,000
=========== =========== ===========
Loss per share - basic and diluted ($ 0.00) ($ 0.01) ($ 0.00)
=========== =========== ===========
See notes to unaudited condensed financial statements
5
FREEWILLPC.COM, INC.
STATEMENT OF STOCKHOLDERS' EQUITY AND ACCUMULATED DEFICIT
For the period from June 13, 2000 (date of inception) to June 30, 2002
Common Stock
------------- Paid In Accumulated
Shares Amount Capital Deficit Total
-----------------------------------------------------------------
Balance - June 13, 2000
(date of inception) 0 0 0 0 0
Shares issued on
June 13, 2000 for:
Cash 500,000 $ 500 $ 500
Services 3,500,000 3,500 3,500
June 15, 2000 for:
Website development 200,000 200 9,800 10,000
Paid in capital by shareholder 600 600
Net Loss - December 31, 2000 (9,012) (9,012)
-----------------------------------------------------------------
Balance
December 31, 2000 4,200,000 $ 4,200 $ 10,400 ($9,012) $ 5,588
Sale of common stock 380,000 380 94,620 95,000
Expenses of offering (10,164) (10,164)
Paid in capital by shareholder 1,200 1,200
Net Loss (40,096) (40,096)
-----------------------------------------------------------------
Balance
December 31, 2001 4,580,000 $ 4,580 $ 96,056 ($49,108) $ 51,528
Stock issued for services 20,000 20 5,980 6,000
Paid in capital by shareholder 500 500
Net Loss (58,028) (58,028)
-----------------------------------------------------------------
Balance - June 30, 2002 4,600,000 $ 4,600 $ 102,536 ($107,136) $ 0
See notes to unaudited condensed financial statements
6
FREEWILLPC.COM, INC.
STATEMENT OF CASH FLOWS
For the period from June 13, 2000 (date of inception) and
Six months ended June 30, 2002
Period from
Six months Inception
ended (June 13, 2000)
June 30, 2002 to June 30, 2001
(Unaudited) (Unaudited)
---------------- -----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($58,029) ($11,638)
Adjustments to reconcile net loss to net
cash (used) provided by operating activities:
Increase (decrease) in accounts payable (14,943) 3,254
Decrease in accounts receivable 13,093
Items not requiring cash:
Stock issued for services 6,000 3,500
Amortization 1,389 3,612
Paid in capital by shareholder 500 1,200
Impairment Loss 3,333
-------- --------
NET CASH (USED) BY
OPERATING ACTIVITIES: ($48,657) ($ 72)
CASH FLOWS FROM INVESTING ACTIVITIES:
Advertising expenses 43,700 0
CASH FLOWS FROM FINANCING ACTIVITIES:
Offering costs 0 500
-------- --------
Total cash flows from financing activities 0 500
-------- --------
NET INCREASE (DECREASE) IN CASH ($ 4,957) $ 428
CASH, BEGINNING OF PERIOD $ 4,957 0
-------- --------
CASH, END OF PERIOD $ 0 $ 428
======== ========
See notes to unaudited condensed financial statements
7
FREEWILLPC.COM, INC.
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
June 30, 2002
Note A - Presentation
The condensed balance sheet of the Company as of June 30, 2002, the related
condensed statements of operations for the six months ended June 30, 2002 and
2001, the statement of stockholders' equity and accumulated deficit for the
period June 13, 2000 (date of inception) to June 30, 2002, and the statements of
cash flows for the six months ended June 30, 2002 and 2001, included in the
condensed financial statements include all adjustments (consisting of normal,
recurring adjustments) necessary to summarize fairly the Company's financial
position and results of operations and cash flows. The results of operations for
the six months ended June 30, 2002 are not necessarily indicative of the results
of operations for the full year or any other interim period. The information
included in this Form 10-QSB should be read in conjunction with Management's
Discussion and Analysis and Financial Statements and notes thereto included in
the Company's December 31, 2001 Form 10-KSB.
Note B - Going Concern
The accompanying financial statements have been presented on the basis that the
Company is a going concern, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. For reasons
discussed below, realization of assets and satisfaction of liabilities is
subject to uncertainty. Resolution of disputed liabilities of recently acquired
companies could materially change accompanying financial statements when
combined.
The ability of the company to continue as a going concern is contingent upon,
among other things, the ability to
1. Fully implement the agreed upon purchase and acquisitions.
2. Develop an appropriate business plan and strategic direction for the
Company's planned future operations, including conservation of
available capital and working capital as the Company seeks to develop
and exploit its asset portfolio.
3. Generate adequate sources of working capital and other liquidity as
necessary to meet future obligations.
The Company's current plan is to concentrate on further acquisitions and mergers
that will not involve substantial capital requirements or large overhead
expenses for the Company.
The Company believes that the cash that it currently has available or will
receive as part of recent mergers and acquisitions will be inadequate to supply
the necessary working capital for the remainder of calendar 2002. Additional
working capital will be necessary to meet the contemplated cash needs.
In the event that the Company completes its acquisition of and merger with
currently planned additional companies, the newly existing Company will require
additional working capital to meet these potential cash needs.
CHANGE IN CONTROL OF REGISTRANT
On June 14, 2002, in connection with the closing of the acquisition of American
Leisure
8
Holdings, Inc., a Nevada corporation ("ALH") by FreewillPC.com, Inc.
(the "Registrant"), as more fully described in Item 2 below, Malcolm J. Wright
and his family acquired the beneficial ownership of 360,000 shares of Series A
Preferred Stock and 1,970,813 shares of Common Stock of the Registrant as
consideration for their beneficial ownership interests in ALH. Roger Maddock
acquired the beneficial ownership of 505,000 shares of Series A Preferred Stock
and 2,287,616 shares of Common Stock of the Registrant as consideration for his
beneficial ownership interests in ALH. Mr. Wright and his family and Mr. Maddock
control a majority of the voting power of the Registrant.
Also, in connection with the Registrant's acquisition of ALH, Vyrtex Limited a
UK company, which had acquired 3,830,000 shares of Common Stock of the
Registrant, surrendered 3,791,700 shares of Common Stock, as required under the
terms of the acquisition of ALH.
The Registrant's Series A Preferred Stock has the following rights, privileges
and preferences:
o The Series A Preferred Stock has a liquidation value of $10.00 per
share;
o The holders of Series A Preferred Stock are entitled to cumulative
dividends at the rate of $1.20 per share per year;
o The liquidation rights of the holders of Series A Preferred Stock are
senior to the holders of Common Stock;
o Each share of Series A Preferred Stock is convertible, at the option
of the holder, into ten shares of Common Stock. The conversion rate is
adjusted for stock splits and dividends, and similar events, or if the
market price of the Common Stock is below $1.00, subject to certain
limitations.
o The holders of Series A Preferred Stock have voting rights with the
holders of Common Stock as a single class based on the conversion
rate. Currently, each share of Series A Preferred Stock is entitled to
ten votes.
o The Registrant may redeem all of the Series A Preferred stock
outstanding, if any, in June 2007, equal to the liquidation value plus
any accrued and unpaid dividends.
ACQUISITION OR DISPOSITION OF ASSETS
On June 14, 2002, the Registrant completed the acquisition of ALH. The
acquisition was completed by the purchase of 99% of the outstanding capital
stock of ALH. As consideration, the Registrant issued 880,000 shares of Series A
Preferred Stock and 4,819,665 shares of the Registrant's Common Stock. The
Registrant anticipates acquiring the remaining outstanding capital stock of ALH
for 197,000 shares of Common Stock. ALH is a holding company which has the
following subsidiary companies:
o American Professional Management Group, Inc., a Florida corporation,
which is the owner of a motel near Orlando, Florida.
9
o Sunstone Golf Resort, Inc., a Florida corporation, which owns 163
acres of land, with planning permission to develop a 799 vacation home
destination resort, near Orlando Florida.
o Leisureshare International PLC, a UK corporation, which is the holding
company of Leisureshare International Espanol S. A. a Spanish leisure
development company, Orlando Holidays, Inc., a licensed seller of
travel, Welcome to Orlando, Inc., an Orlando meet and greet company
and American Travel and Marketing Group, Inc. a company specializing
in the formation of Travel Clubs and the sale of travel related
services to those clubs based in Miami Florida.
o American Leisure, Inc., a Florida corporation, a holding company which
business includes two wholly-owned subsidiaries as follows:
o I-Drive Limo's, Inc., which owns and operates limousines; and
o American Leisure Homes, Inc., which, through a joint venture, is
in the business of offering vacation ownership properties for
sale in Orlando, Florida.
OTHER EVENTS
On June 26, 2002, the Registrant's Board of Directors was increased to six
members. The current Board of Directors consists of James Leaderer, The Rt. Hon.
Edward Seaga, Williston Clover, William Chiles, Malcolm J. Wright and Gillian M
Wright. Mr. Chiles was appointed as the Chairman of the Board.
Note C - Merger
The mergers and acquisitions will all be accounted for as "purchase"
transactions in accordance with generally accepted accounting principles. After
the mergers and acquisitions are complete, the results of operations of all the
entities above will be included in the consolidated financial statements of
American Leisure Holdings, Inc. The purchase price will be allocated based on
the fair value of the assets acquired and the liabilities assumed by the
combined company.
The fair value assigned to any intangible assets acquired will be based on a
valuation prepared by an independent third party appraisal company.
Note D - Combined Pro Forma Disclosure
As noted above, the merger of FreeWillPC.com and American Leisure Holdings, Inc.
occurred June 14, 2002, less than one month before the quarter ended June 30,
2002.
Audited financial statements for American Leisure Holdings, Inc. and
subsidiaries for the year ended December 31, 2001 and unaudited information for
the six months and quarter ended June 30, 2002 will be provided with the Form 8K
which is due on August 28, 2002.
10
ITEM 2. MANAGEMENT'S PLAN OF OPERATIONS
The following discussion and analysis should be read in conjunction
with the Financial Statements and Notes thereto appearing elsewhere in this
Quarterly Report. Certain statements in this Quarterly Report, which are not
statements of historical fact, are forward-looking statements. See "Special Note
Regarding Forward-Looking Information" on Page 2.
General
We have been designed and structured to own, control and direct a
series of companies in the travel and tourism industries so that we can achieve
significant vertical and horizontal integration in the sourcing of, and the
delivery of, corporate and vacation travel services. Our mission is to:
o own and operate vacation hotel/resort properties,
o build large travel club membership bases through various travel
club programs,
o build a large membership base in our vacation and travel clubs,
and
o promote our resort assets and sell travel services and vacation
ownership to those club members and other corporate and vacation
travelers.
Acquisitions
In June 2002, we acquired control of several travel related companies,
described below:
American Leisure, Inc. ("ALI")
ALI will be the holding company for all of our Leisure Travel
divisions. It will also package holidays and vacations and sell these within the
trade and through its own tour operations.
Sunstone Golf Resort, Inc. ("SGR")
SGR is currently in the planning stage as a 799 unit vacation
destination resort in Orlando, Florida proposed for the commencement of
development in the spring of 2003. We intend to provide development and
financing support for the development of the resort.
American Travel & Marketing Group, Inc. ("ATMG")
We believe that ATMG will generate significant travel business through
the creation of clubs comprised of affinity based travelers. ATMG has developed
a travel club system and travel incentive strategy that creates and fulfills the
travel and incentive needs of corporations, organizations and associations with
significant member databases.
Once the infrastructure has been finalized to communicate and sell to
its affinity-based club databases, we anticipate that ATMG will derive
substantial revenue from annual membership fees and commissions earned on the
sale of travel services.
Leisureshare International, PLC ("LIP")
LIP, and its subsidiary, Leisureshare International, Inc., a vacation
marketing company, will be dedicated to sales of vacation properties and
vacation club memberships.
In July 2002, we entered into a contract to acquire a controlling
interest of HTS Holdings, Inc., the parent to, among other companies, Hickory
Travel Services, In, which will focus on the fulfillment of all of our
companies' travel needs. We anticipate completing the acquisition in the Fall of
2002.
11
Strategy
Our business model is based on four basic premises:
o Club Creation and Administration. We intend to promote and
service both travel clubs and vacation clubs to derive membership
dues revenue, travel commissions revenue and prospects for
conversion of travel club members to vacation club members. To
enhance membership benefits, we intend to affiliate with vacation
exchange programs and provide finance to members.
o Resort Real Estate. In addition to our current vacation resort
assets, we intend to purchase additional vacation resort assets,
particularly in the Caribbean and Florida resort areas where the
demand for vacation property is strong the majority of the year.
Such resorts assets will likely include the following:
o properties suitable for convergent use for vacation club,
such as suites, one bedroom and two bedroom units;
o properties with contiguous vacant land suitable for further
expansion;
o properties that have consistently sustained at least
break-even occupancy;
o for developable land, acreage suitable for hotel, vacation
resort and/or vacation club development in prime locations
with room for a substantial amenity packages; and
o locations that have appeal throughout the year rather than
limited "seasonal" attraction.
o Vacation Ownership. We intend to market vacation assets and
vacation club memberships to the general public. The membership
bases of our vacation and travel clubs and guests staying at our
resort assets will likely provide an ongoing source of prospects
for our vacation assets and vacation club membership sales.
Revenues from the sale of vacation assets and vacation club
memberships is expected to be a substantial component in our
ability to capitalize the front end of developments and the
equity requirement for resort acquisitions.
o Travel Services. We intend to capitalize on the travel
requirements of servicing the travel clubs and vacation clubs to
garner significant group purchasing, branding and third party
branding power. By actively focusing on the demand side coupled
with having the structure to fulfill the travel requirements both
at our resort assets and at other venues, we will seek to obtain
seamless vertical and horizontal integration of services such
that the traveler's entire range of needs can be fulfilled or
provided by us.
Cash Flow Requirements
We will require substantial capital to adequately finance our proposed
acquisitions, meet our obligations under our business model, and provide for our
working capital. We anticipate that we will require approximately $22.5 million
over the next twelve months to fully implement our business model. We anticipate
that we will use such funds as follows:
Program Development and Implementation Costs $16,500,000
Payoff Debt $ 3,000,000
Acquisition Costs $ 1,000,000
Working Capital $ 2,000,000
12
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In June, 2001, Rock Investment Trust, P.L.C., a British limited
liability company, and RIT, L.C., a related Florida limited liability company,
filed suit against Malcolm J. Wright, American Vacation Resorts, Inc., American
Leisure, Inc., Inversora Tetuan, S.A., Sunstone Golf Resort, Inc., and SunGate
Resort Villas, Inc., seeking either the return of an alleged $500,000 investment
or ownership interest in one or more of the defendant entities equivalent to the
alleged investment amount. Defendants have denied all claims and Mr. Wright,
American Vacation Resorts, Inc., American Leisure, Inc., Inversora Tetuan, S.A.,
Sunstone Golf Resort, Inc., and SunGate Resort Villas, Inc. have counterclaimed
against Rock Investment Trust and its principal, Roger Smee, seeking damages in
excess of $10 million, assuming success on all aspects of the litigation. The
litigation is in the discovery phase and is not currently set for trial. While
many depositions and other discovery of facts remains to be done, based on the
status of the record developed thus far, counsel believes that Rock Investment
Trust's and RIT's claims are without merit and that the counterclaim will be
successful. The amount of damages which may be recovered on the counterclaim is
subject to a variety of factors and considerations.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Issuance of Senior Securities
On June 14, 2002, in connection with the closing of the acquisition of
American Leisure Corporation (formerly American Leisure Holdings, Inc.) ("ALC"),
we authorized the issuance of up to 1,000,000 shares of Series A Preferred
Stock, of which 880,000 were issued to certain debt holders of ALC. Our Series A
Preferred Stock has the following rights, privileges and preferences:
o The Series A Preferred Stock has a liquidation value of $10.00
per share, which is senior to the liquidation rights of our
common shareholders;
o The holders of Series A Preferred Stock are entitled to
cumulative dividends at the rate of $1.20 per share per year,
which such dividends must be paid before any dividends may be
paid to our common shareholders;
o Each share of Series A Preferred Stock is convertible, at the
option of the holder, into ten shares of Common Stock. The
conversion rate is adjusted for stock splits and dividends, and
similar events, or if the market price of the Common Stock is
below $1.00, subject to certain limitations.
o The holders of Series A Preferred Stock have voting rights with
our common shareholders as a single class based on the conversion
rate. Currently, each share of Series A Preferred Stock is
entitled to ten votes.
o We may redeem all of the Series A Preferred stock outstanding, if
any, in June 2007, equal to the liquidation value plus any
accrued and unpaid dividends.
Sales of Our Equity Securities Not Registered Under the Securities Act of 1933
On May 15, 2002, our Board of Directors authorized the issuance of
20,000 shares of our common stock to Tripoint Capital in connection with its
compensation for advisory services provided to us. These securities were sold
under the exemptions from registration provided by Section 4(2) of the Act and
Regulation D promulgated under the Act. Neither we nor any person acting on our
behalf offered or sold the securities by means of any form of general
solicitation or general advertising. Tripoint Capital represented in writing
that it acquired the securities for its own account. A legend was placed on the
certificates stating that the securities have not been registered under the
Securities Act and cannot be sold or otherwise transferred without an effective
registration or an applicable exemption.
On May 20, 2002, our Board of Directors authorized the issuance of up
to 3,000,000 shares of our common stock pursuant to a private placement at the
purchase price of $1.50 per share. We sold 36,009 shares in such private
13
placement. These securities were sold under the exemptions from registration
provided by Regulation S promulgated under the Securities Act (the "Act").
Neither we nor any person acting on our behalf offered or sold the securities by
means of any form of general solicitation or general advertising. Each investor
represented in writing that he or she acquired the securities for his or her own
account. A legend was placed on the certificates stating that the securities
have not been registered under the Securities Act and cannot be sold or
otherwise transferred without an effective registration or an applicable
exemption.
On May 20, 2002, our Board of Directors authorized the issuance of
5,000 shares of our common stock to James Leaderer in connection with his
compensation for serving as our president and chief executive officer. These
securities were sold under the exemptions from registration provided by Section
4(2) of the Act and Regulation D promulgated under the Act. Neither we nor any
person acting on our behalf offered or sold the securities by means of any form
of general solicitation or general advertising. Mr. Leaderer represented in
writing that he acquired the securities for his own account. A legend was placed
on the certificates stating that the securities have not been registered under
the Securities Act and cannot be sold or otherwise transferred without an
effective registration or an applicable exemption.
On June 14, 2002, we completed the acquisition of American Leisure
Corporation (formerly American Leisure Holdings, Inc.) ("ALC"). The acquisition
was completed by the purchase of 99% of the outstanding capital stock of ALC. As
consideration, we issued 880,000 shares of our Series A Preferred Stock and
4,819,665 shares of our common stock. These securities were sold under the
exemptions from registration provided by Section 4(2) of the Act and Regulation
D and Regulation S promulgated under the Act. Neither we nor any person acting
on our behalf offered or sold the securities by means of any form of general
solicitation or general advertising. Each purchaser represented in writing that
he or she acquired the securities for his or her own account. A legend was
placed on the certificates stating that the securities have not been registered
under the Securities Act and cannot be sold or otherwise transferred without an
effective registration or an applicable exemption.
ITEM 3. DEFAULTS IN SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On May 11, 2002, a shareholder owning a majority of our outstanding
common stock, acting by written consent, appointed James Leaderer to serve as
our sole director.
On May 11, 2002, our sole director authorized the adoption of the
Amended and Restated Articles of Incorporation and Amended and Restated Bylaws
and recommended that holders of record of our common stock as of May 13, 2002,
approve, by written consent, such adoption. On May 13, 2002, a shareholder
owning a majority of our outstanding common stock, acting by written consent,
approved the adoption of the Amended and Restated Articles of Incorporation and
Amended and Restated Bylaws, copies of which are annexed to this Form 10-QSB as
exhibits.
On June 8, 2002, our sole director authorized the adoption of the
amendment to our Amended and Restated Articles of Incorporation and recommended
that holders of record of our common stock as of June 9, 2002, approve, by
written consent, such adoption. On June 9, 2002, shareholders owning a majority
of our outstanding voting stock, acting by written consent, approved the
adoption of the amendment to our Amended and Restated Articles of Incorporation,
a copy of which is annexed to this Form 10-QSB as an exhibit.
14
ITEM 5. OTHER INFORMATION
Form 8-K; Item 4; Changes in Registrant's Certifying Accountants
On August 12, 2002, we appointed the accounting firm of Marc Lumer &
Company of San Francisco, California, as the principal independent accountants
for the quarters ended June 30, 2002 and September 30, 2002 and for the fiscal
year ended December 31, 2002 to replace J.S. Osborn, P.C. who was dismissed as
the principal independent accountants effective with such appointment. The
decision to change the principal independent accountants has not yet been
approved by our Board of Directors.
During the two most recent fiscal years and interim period subsequent
through the quarter ended March 31, 2002, there have been no disagreements with
J.S. Osborn, P.C., on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure or any other
reportable events.
J.S. Osborn, P.C.'s report on the financial statements for each of the
past two years contained a qualification about our ability to continue as a
going concern. Except for the foregoing going concern qualification, J.S.
Osborn, P.C.'s report on the financial statements for each of the past two years
contained no adverse opinion or disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles.
We have provided J.S. Osborn, P.C. with a copy of this disclosure, and
requested that J.S. Osborn, P.C. furnish a letter to the Commission stating
whether it agrees with the above statements. (A copy of that letter is filed as
Exhibit 16 to this Form 10-QSB).
Form 8-K; Item 9; Regulation FD Disclosure
In accordance with 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, our Chief Executive Officer and
Chief Financial Officer executed the following written statements which
statements accompanied the filing with the Securities and Exchange Commission of
this Quarterly Report on Form 10-QSB:
Certification Pursuant To 18 U.S.C. Section 1350,
As Adopted Pursuant To
Section 906 of The Sarbanes-Oxley Act of 2002
I, L. William Chiles, Chief Executive Officer of American Leisure Holdings, Inc.
(the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that:
o the Company's Quarterly Report on Form 10-QSB for the fiscal
quarter ended June 30, 2002, as filed with the Securities and
Exchange Commission on the date hereof (the "Report") fully
complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
o the information contained in the Report fairly presents, in all
material respects, the financial condition and result of
operations of the Company for the periods presented therein.
Certification Pursuant To 18 U.S.C. Section 1350,
As Adopted Pursuant To
Section 906 of The Sarbanes-Oxley Act of 2002
I, Malcolm J. Wright, Chief Financial Officer of American Leisure Holdings, Inc.
(the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that:
o the Company's Quarterly Report on Form 10-QSB for the fiscal
quarter ended June 30, 2002, as filed with the Securities and
Exchange Commission on the date hereof (the "Report") fully
complies with the
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requirements of Section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and
o the information contained in the Report fairly presents, in all
material respects, the financial condition and result of
operations of the Company for the periods presented therein.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
3.1 Amended and Restated Articles of Incorporation of FreewillPC.com,
Inc. dated July 24, 2002*
3.2 Certificate of Amendment to Amended and Restated Articles of
Incorporation of FreewillPC.com, Inc. dated July 24, 2002*
3.3 Certificate of Designations of Series and Determination of Rights
and Preferences of Series A Preferred Stock of FreewillPC.com,
Inc.*
3.4 Amended and Restated Bylaws of FreewillPC.com, Inc. adopted May
13, 2002*
4.1 Form of Common Stock Certificate*
4.2 Form of Series A Preferred Stock Certificate*
10.1 Stock Purchase Agreement by and among FreewillPC.com, Inc., et al,
dated June 14, 2002 (incorporated by reference to the Current
Report on Form 8-K filed with the Securities and Exchange
Commission on June 28, 2002)
10.2 Stock Option Agreement by and among American Leisure Holdings,
Inc. and L. William Chiles dated July 15, 2002*
16.1 Letter to J.S. Osborn, P.C. re: change of certifying accountants*
21.1 List of Subsidiaries*
* annexed hereto
(b) Reports on Form 8-K.
On May 24, 2002, we filed a Current Report on Form 8-K disclosing the
change in control of our common stock.
On June 28,2002, we filed a Current Report on Form 8-K disclosing the
change in control of our common stock, the acquisition of American Leisure
Corporation, formerly known as American Leisure Holdings, Inc., and the
appointment of five additional members of our Board of Directors.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
AMERICAN LEISURE HOLDINGS, INC.
Dated: August 19, 2002 By: /s/ L. William Chiles
----------------------
L. William Chiles
Chief Executive Officer
Dated: August 19, 2002 By: /s/ Malcolm J. Wright
----------------------
Malcolm J. Wright
Chief Financial Officer
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