UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(x) Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 2000
( ) Transition Report Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the transition period from ___ to ___
TERRA SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Utah 87-0476073
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5912 West 11600 South, Payson, Utah 84651
(Address of principal executive offices) (Zip Code)
(801) 465-1262
(Registrant's telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year,
if changed since last report)
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 ( )
The number of shares outstanding of the Registrant's common stock as of
September 30, 2000 was 17,314,793
<PAGE>
Terra Systems, Inc.
Table of Contents
PART I FINANCIAL INFORMATION 1
Item 1 Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets - September 30, 2000
and December 31, 1999 3
Condensed Consolidated Statements of Operations for the
Three and Nine Months Ended September 30, 2000 and 1999
and for the Cumulative Period February 17, 1996 (Date of
Inception) Through September 30, 2000 4
Condensed Consolidated Statements of Cash Flows for the
Three and Nine Months Ended September 30, 2000 and 1999
and for the Cumulative Period February 17, 1996 (Date of
Inception) Through September 30, 2000 5
Notes To Consolidated Financial Statements 6
Item 2 Managements Discussion and Plan of Operations 11
PART II OTHER INFORMATION 12
Item 1 Legal Proceedings 12
Item 2 Changes in Securities and Use of Proceeds 12
Item 3 Defaults Upon Senior Securities 12
Item 4 Submission of Matters to a Vote of Security Holders 12
Item 5 Other Information 12
Item 6 Exhibits and Reports on Form 8-K 12
<PAGE>
PART I- FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
TERRA SYSTEMS, INC. AND SUBSIDIARY
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2000 1999
---------- ----------
(Unaudited)
ASSETS
Current Assets
Cash $ 934 $ 1,429
Receivables 6,010 5,075
Prepaid expenses - -
---------- ----------
Total Current Assets 6,944 6,504
---------- ----------
Property and Equipment
Leasehold improvements 331,642 331,642
Furniture and equipment 687,558 687,424
Trucks and automobiles 22,000 22,000
Software 10,380 10,380
Less: Accumulated depreciation (503,696) (410,000)
---------- ----------
Net Property and Equipment 547,884 641,446
---------- ----------
Total Assets $ 554,828 $ 647,950
========== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable $ 351,975 316,183
Accounts payable to related party 270,509 200,175
Accrued liabilities 689,114 542,224
Accrued interest payable 250,509 192,946
Capital lease obligation - current portion 237,318 178,210
---------- ----------
Total Current Liabilities 1,799,425 1,429,738
---------- ----------
Long-Term Liabilities
Notes payable to stockholders - net
of current portion 656,517 756,517
Capital lease obligation - net of
current portion 21,348 95,580
---------- ----------
Total Long-Term Liabilities 677,865 852,097
---------- ----------
Stockholders' Deficit
Common stock, $0.001 par value; 100,000,000
shares authorized; shares outstanding:
September 30, 2000 - 17,314,793 shares
December 31, 1999 - 15,827,800 shares 17,315 15,828
Additional paid-in capital 4,492,247 3,589,098
Deficit accumulated during the
development stage (6,420,754) (5,210,718)
Deferred compensation (11,270) (28,093)
---------- ----------
Total Stockholders' Deficit (1,922,462) (1,633,885)
---------- ----------
Total Liabilities and Stockholders' Deficit $ 554,828 $ 647,950
========== ==========
See accompanying notes to condensed consolidated financial statements.
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<PAGE>
TERRA SYSTEMS, INC. AND SUBSIDIARY
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Cumulative
For the Period
February 17,
For the Three Months For the Nine Months 1996 (Inception)
Ended September 30, Ended September 30, Through
------------------------ ------------------------ September 30,
2000 1999 2000 1999 2000
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Revenues $ 642 $ 73,770 $ 6,792 $ 129,690 $ 336,464
Cost of Revenues -- 74,279 2,497 105,861 307,558
----------- ----------- ----------- ----------- -----------
Gross Profit (Loss) 642 (509) 4,295 23,829 28,906
----------- ----------- ----------- ----------- -----------
Expenses
Research and development 34,424 23,833 108,073 68,955 1,300,385
General and administrative 145,990 369,269 951,008 778,566 4,176,597
Depreciation and amortization 31,233 31,411 93,696 94,513 509,677
----------- ----------- ----------- ----------- -----------
Total Expenses 211,647 424,513 1,152,777 942,034 5,986,659
----------- ----------- ----------- ----------- -----------
Loss from Operations (211,005) (425,022) (1,148,482) (918,205) (5,957,753)
----------- ----------- ----------- ----------- -----------
Nonoperating Income/
(Expenses)
Interest expense (15,503) (18,573) (61,576) (64,855) (359,057)
Interest income 11 (125) 22 -- 1,727
Loss on sale of securities -- -- -- -- (99,000)
Loss on sale of assets -- -- -- -- (6,671)
----------- ----------- ----------- ----------- -----------
Net Nonoperating Income/
(Expenses) (15,492) (18,698) (61,554) (64,855) (463,001)
----------- ----------- ----------- ----------- -----------
Net Loss $ (226,497) $ (443,720) $(1,210,036) $ (983,060) $(6,420,754)
=========== =========== =========== =========== ===========
Basic and Diluted Loss
Per Share $ (0.01) $ (0.03) $ (0.07) $ (0.06) $ (0.41)
=========== =========== =========== =========== ===========
Weighted Average Shares
Outstanding 17,150,143 15,482,409 16,623,504 15,200,548 15,600,624
=========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
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<PAGE>
TERRA SYSTEMS, INC. AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Cumulative
For the Period
February 17,
For the Nine Months 1996 (Inception)
September 30, Through
------------------------ September 30,
2000 1999 2000
----------- ----------- -----------
<S> <C> <C> <C>
Cash Flows From Operating Activities
Net loss $(1,210,036) $ (983,060) $(6,420,754)
Adjustments to reconcile net loss to
net cash used by operating activities:
Depreciation and amortization 93,696 94,513 509,677
Loss on sale of investment securities - - 99,000
Loss on sale of assets - - 6,671
Compensation paid with common stock 65,623 417,611 755,441
Consulting expense relating to
grant of stock options 560,000 - 560,000
Receivables (935) 22,236 (6,010)
Prepaid expenses - 166 -
Accounts payable 35,792 101,202 470,585
Accounts payable - related party 70,335 (631) 181,280
Accrued liabilities 146,890 99,608 689,114
Accrued interest payable 57,563 58,513 250,509
----------- ---------- ------------
Net Cash Used by Operating Activities (181,072) (189,842) (2,904,487)
----------- ---------- ------------
Cash Flows From Investing Activities
Purchase of equipment (134) (106) (662,598)
Organization costs paid - - (4,755)
Proceeds from sale of assets - - 117,715
----------- ---------- ------------
Net Cash Used by Investing Activities (134) (106) (549,638)
----------- ---------- ------------
Cash Flows From Financing Activities
Proceeds from borrowings - stockholders - - 870,111
Payments on borrowings - stockholders - (5,000) (149,750)
Proceeds from stock issuance and
subscriptions 195,835 225,460 2,899,626
Payments on capital lease obligations (15,124) (23,025) (164,928)
----------- ---------- ------------
Net Cash Provided by Financing Activities 180,711 197,435 3,455,059
----------- ---------- ------------
Net Increase (Decrease) in Cash (495) 7,487 934
Cash at Beginning of Period 1,429 4,499 -
----------- ---------- ------------
Cash at End of Period $ 934 $ 11,986 $ 934
=========== ========== ============
Supplemental Cash Flow Information
Interest Paid $ 4,013 $ -
Non-Cash Investing and Financing Activities
Conversion of notes payable to equity $ 100,000 $ -
Redemption of stock issued to officer 56,200 -
</TABLE>
See accompanying notes to condensed consolidated financial statements.
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<PAGE>
TERRA SYSTEMS, INC. AND SUBSIDIARY
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1-INTERIM FINANCIAL STATEMENTS
The accompanying financial statements have been prepared by the
Company, and are unaudited. In the opinion of management, the
accompanying unaudited financial statements contain all necessary
adjustments for fair presentation, consisting of normal recurring
adjustments except as disclosed herein.
The accompanying unaudited interim financial statements have been
condensed pursuant to the rules and regulations of the Securities and
Exchange Commission; therefore, certain information and disclosures
generally included in financial statements have been condensed or
omitted. These financial statements should be read in connection with
the Company's annual financial statements included in the Company's
annual report on Form 10-KSB as of December 31, 1999. The financial
position and results of operations of the interim periods presented
are not necessarily indicative of the results to be expected for the
year ended December 31, 2000.
NOTE 2-RELATED PARTY TRANSACTIONS
The Company entered into capital and operating lease obligations with
a company under common ownership. The Company has violated its lease
agreements by being delinquent in its payments regarding these
leases. At September 30, 2000, the Company owed this related party
$212,507 in delinquent rent, executory fees, late fees, sales tax and
cash advances. Certain Officers of the Company have from time to time
advanced the Company funds used for operating expenses. At September
30, 2000, the Company owed these Officers $58,002. Total amounts due
to Related Parties as shown on the balance sheet at September 30,
2000 are $270,509. All amounts are due on demand with no interest.
NOTE 3-STOCK RIGHTS
On March 29, 2000, the Company entered into an agreement with a
corporation for consultation and advisory services related to
business management and marketing. In consideration for the services
to be provided, the Company agreed to grant to the corporation the
right to purchase 50,000 equity units at a purchase price of $5.00
per unit. Each unit consists of 20 freely tradable common shares and
the option to purchase five shares at $0.50, five shares at $0.75,
five shares at $1.00, and five shares at $1.25 - all freely tradeable
shares. The option to purchase the 1,000,000 shares may not be
exercised after March 22, 2001, unless the corporation arranges for
an acceptable second offering agreed to by the Company, in which the
option shall automatically extend for an additional two years and
expire on March 22, 2003.
The agreement for services shall be in effect from March 22, 2000 and
shall continue in effect for a period of six months. The agreement
may be renewed for a three-month period thereafter, upon mutual
agreement of the parties.
The Company measured compensation under this stock-based agreement
using the fair value at the grant date consistent with SFAS No. 123,
Accounting for Stock-Based Compensation. Under this method, the
Company recognized consulting expense of $560,000. The fair value of
$11.20 for each equity unit granted was estimated on the date of
grant using the Black-Scholes option pricing model with the following
assumptions: dividend yield of 0.0%; expected volatility of 145.00%
risk-free rate of 6.13% and expected life of options of 1.0 year.
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<PAGE>
Upon grant of the rights, the corporation exercised its right and
purchased 20,000 equity units. The Company received $100,000 for the
delivery of 400,000 unrestricted shares of common stock and issued
options to purchase an additional 100,000 shares at $0.50, 100,000
shares at $0.75, 100,000 shares at $1.00 and 100,000 shares at $1.25.
In connection with the consulting agreement, the corporation will
recommend the Company to potential investors. A finder's fee will be
paid to the corporation as a percentage of funds obtained. A finder's
fee of $150,000 would be paid on $5,000,000 obtained. An additional
1% would be owed on any additional funds obtained over the
$5,000,000. The corporation may elect to obtain all or part of its
fee in shares of the Company's stock. The stock will be valued at 80%
of its most recent bid price for purposes of conversion to cash
value.
NOTE 4-STOCK OPTIONS
The Company accounts for its stock options issued to directors,
officers and employees under Accounting Principles Board Opinion No.
25 and related interpretations ("APB 25"). Under APB 25, compensation
expense is recognized if an option's exercise price on the
measurement date is below the fair value of the Company's common
stock. The Company accounts for options and warrants issued to
non-employees in accordance with SFAS No. 123, Accounting for
Stock-Based Compensation" (SFAS 123) which requires these options and
warrants to be accounted for at their fair value.
Employee Options -- During the nine months ended September 30, 2000,
an employee exercised 500,000 stock options for 500,000 shares of
common stock by converting notes payable in the amount of $100,000,
or $0.20 per share.
Non Employee Options -- As discussed in Note 3, the Company entered
into an agreement with a corporation for consultation and advisory
services related to business management and marketing. In
consideration for the services to be provided, the Company agreed to
grant to the corporation the right to purchase 50,000 equity units.
Upon grant of the rights, the corporation exercised its right and
purchased 20,000 equity units. Accordingly, the Company issued
options to purchase 100,000 shares of common stock at $0.50, 100,000
shares at $0.75, 100,000 shares at $1.00 and 100,000 shares at $1.25.
Also discussed in note 3, the Company recognized consulting expense
of $560,000 in connection with the grant of the stock rights.
Accordingly, any consulting expense associated with the grant of the
400,000 stock options mentioned above was previously recognized.
Outstanding Stock Options -- A summary of the status of the Company's
stock options as of September 30, 2000 and 1999 and changes during
the nine months then ended is as follows:
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<PAGE>
<TABLE>
<CAPTION>
For the Nine Months Ended For the Nine Months Ended
September 30, 2000 September 30, 1999
----------------------- ------------------------
Weighted- Weighted-
Average Average
Shares Exercise Price Shares Exercise Price
--------- ------------ --------- -----------
<S> <C> <C> <C> <C>
Outstanding at beginning of period 2,250,000 $ 0.20 - $ -
Forfeited - - (250,000) 0.20
Exercised (500,000) 0.20 - -
Granted 400,000 0.88 2,500,000 0.20
--------- ---------
Outstanding at period end 2,150,000 0.33 2,250,000 0.20
========= =========
Options exercisable at period end 2,150,000 $0.33 2,250,000 $ 0.20
========= =========
Weighted-average fair value of
options granted during the period $ 0.21 $ 0.20
========= =========
</TABLE>
NOTE 5-STOCKHOLDERS' EQUITY
During the nine months ended September 30, 2000, an officer of the
Company, who had been issued 150,000 shares of contingently issued
stock, left the Company, and forfeited 50,000 shares of non-vested
common stock valued at $56,200.
Common Stock Issued for Cash -- During the nine months ended
September 30, 2000, the Company issued 376,673 shares of common stock
for proceeds of $95,835 at prices ranging from $0.25 to $0.30 per share.
Common Stock Issued for Services -- During the nine months ended
September 30, 2000, the Company issued 260,320 shares of stock for
consulting services valued at $105,000 at prices ranging from $0.25
to $1.00 per share.
Common Stock Issued for the Conversion of Debt -- During the nine
months ended September 30, 2000, a stockholder exercised 500,000
options. The Company issued 500,000 shares of common stock for the
conversion of notes payable to stockholders in the amount of $100,000
or $0.20 per share.
Stock Rights Exercised -- As discussed in Note 3, the Company granted
stock rights in connection with a consulting agreement. The Company
recognized consulting expense of $560,000 in connection with the
grant of these stock rights. Upon grant of the rights, the
corporation exercised its right and the Company issued 400,000 shares
of common stock for $100,000 or $0.25 per share.
NOTE 6-CONTINGENCIES
Terra Systems, Inc. Versus a Former Director/Officer and Other
Stockholders -- The Company has filed a complaint against a former
director and officer and other stockholders of the Company (the
defendants) for using various forms of improper conduct and
misrepresentations concerning their qualifications and intentions to
obtain a significant number of the Company's shares. The Company is
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<PAGE>
seeking a declaration by the court that none of the defendants have
any right, title to or ownership of the Company's stock originally
issued to the defendants. The defendants claim the Company and
certain of its officers have engaged in fraudulent and conspiratorial
conduct and have filed a counterclaim seeking the following: a
dismissal of the Company's complaint, unspecified amount of damages
resulting from the Company's refusal on March 1, 1997 to tender
shares to the defendants that the defendants were entitled to sell,
the removal of certain restrictions on the Company's stock, $60,000
for breach of an employment contract and interest, compensatory
damages and punitive damages in unspecified amounts, and together
with attorney fees.
On October 9, 1999, the Court entered a partial summary judgment
against one of the defendants in favor of the Company on all of its
claims. The Court found that the damages sought against the defendant
and an award of reasonable attorney's fees, and expenses incurred in
connection with the case shall be determined at a future date. The
Court also found that the Company is entitled to a partial summary
judgment against the defendant for securities fraud, including
recission and restitution of the issuance of one million Terra
Systems shares and additional damages to be determined in further
proceedings before the Court. The amount of damages to be awarded has
not yet been determined.
The Company denies all material allegations against the Company and
intends to fully defend the counterclaim of the defendants and
prosecute the Company's claims and actions against the defendants.
This litigation is still in the discovery phase and the ultimate
outcome cannot presently be determined
Threatened Litigation -- The Company and certain Officers and
Directors of the Company received notice from a litigant's legal
counsel of threatened litigation. The litigant contends that certain
current Officers and Directors held and sold a number of Xullux
shares that were free trading prior to the merger of Xullux and Terra
Systems. The alleged sale may have impacted the value of the
litigant's Terra Systems restricted publicly issued shares in the
company. The litigant claims that the defendant's ownership and
alleged sale of Xullux stock was not disclosed to him at or during
the time he contributed certain assets and other equipment to Terra
Systems in exchange for the Terra Systems restricted stock. The
litigant seeks to return 125,000 shares to Terra Systems for value
and seeks other monetary and punitive damages in an amount of not
less than $1,500,000 including additional costs and attorney's fees.
The Company denies all of the material allegations and claims of the
litigant. Currently, the ultimate outcome of this situation cannot
presently be determined.
Based on the uncertain outcome of these contingencies, no provision
for any loss or gain that may result upon adjudication has been made
in the accompanying financial statements, and the possible effect it
will have on future financial statements is unknown.
NOTE 7-BUSINESS CONDITION
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. During
the three month periods ended September 2000 and 1999, the Company
incurred net losses of $226,497 and $443,720, respectively. During
the nine month periods ended September 2000 and 1999, the Company
incurred net losses of $1,210,036 and $983,060, respectively. As of
-9-
<PAGE>
September 2000, the Company's losses accumulated from inception
totaled $6,420,754. These factors, among others, indicate that the
Company may be unable to continue as a going concern for a reasonable
period of time. The financial statements do not include any
adjustments relating to the recoverability and classification of
recorded asset amounts or the amount and classification of
liabilities that might be necessary should the Company be unable to
continue as a going concern. The Company's ability to continue as a
going concern is dependent upon its ability to generate sufficient
cash flow to me meet its obligations on a timely basis, to obtain
additional financing as may be required, and ultimately to attain
successful operations.
The Company's management is in the process of negotiating various
agreements to perform research on and the development of pneumatic
conveyance systems to handle materials in a bulk state in industrial
research and processing. Management also intends to use capital and
debt financing as needed to supplement the cash flows that
potentially could be generated through the successful negotiation of
agreements. As discussed in Note 3, the Company entered into an
agreement with a corporation for consultation and advisory services
related to business management and marketing. As a result of this
agreement, the Company received $100,000 for the issuance of common
stock and options. This agreement allows for additional cash proceeds
through the issuance of additional common stock and options. Aside
from this agreement, the Company obtained additional cash proceeds of
$95,835 through the issuance of common stock.
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<PAGE>
Item 2. Management's Discussion and Plan of Operation
Forward-Looking Statements
This Quarterly Report contains forward-looking statements about our business,
financial condition and prospects that reflect our assumptions and beliefs
based on information currently available. We can give no assurance that the
expectations indicated by such forward-looking statements will be realized.
If any of our assumptions should prove incorrect, or if any of the risks and
uncertainties underlying such expectations should materialize, our actual
results may differ materially from those indicated by the forward-looking
statements.
The key factors that are not within our control and that may have a direct
bearing on operating results include, but are not limited to, acceptance of
our services, our ability to expand our customer base, our ability to raise
capital in the future, the retention of key employees and changes in the
regulation of our industry.
There may be other risks and circumstances that we are unable to predict.
When used in this Quarterly Report, words such as, "believes," "expects,"
"intends," "plans," "anticipates," "estimates" and similar expressions are
intended to identify forward-looking statements, although there may be
certain forward-looking statements not accompanied by such
expressions. All forward-looking statements are intended to be covered by
the safe harbor created by Section 21E of the Securities Exchange Act of
1934.
General
Terra Systems, Inc. ("Terra" or the "Company"), a UTAH corporation, was
incorporated on February 16, 1996. We develop and commercialize low-pressure
pneumatic conveyance systems. These low-pressure systems are used in
connection with the pulverization, moisture control, classification,
transport and processing of bulk materials. A small sampling of the bulk
materials that can be processed, dried, classified, etc. consist of coal,
gypsum, black sands, and agricultural products, such as corn, rice, and
wheat. Terra's mission is to continue the development of low-pressure,
pneumatic conveyance systems and access the commercial markets.
Results of Operations
During the third quarter 2000, Terra Systems, Inc. did not generate revenues.
The Company has been able to generate testing and product development
revenues in past fiscal periods, but has been limited in the scope of
potential clients that could be contacted until the patent filing process was
completed. During the third quarter 2000, we received notification that all
31 claims made to the United States Patent Office have been allowed.
Notification from patent counsel that patent allowances were granted will
substantially enhance Terra's ability to pursue and enter into project
development contracts. It is expected that the full patent will be issued in
the first quarter of 2001. During the third quarter 2000, there were no
significant elements of income/loss that did not arise from continuing
operations.
Future Business
We are currently involved in discussions with PacifiCorp and General Electric
regarding pulverized coal processing for the utility industry. Preliminary
discussions are underway with management and engineering personnel of both
companies. Our technology has the ability to produce low ash, low moisture,
and ultra fine coal, which enhance the combustion process, while reducing
unburned carbon and NOx emissions. It is anticipated that strategic business
alliances will be formed to take advantage of Terra Systems' patented
technology.
We have engaged with P.S.G. LLC (Product Service Group) in a project that
will clean up a low-level radioactive waste site. A successful initial
presentation was made at Terra Systems headquarters at Payson, Utah on
October 13, 2000. The follow-up presentation will be made in Denver to
Morrison-Knudsen Corp by mid-November, 2000. In this presentation, Terra
will propose a total bulk handling system that will extract, transport,
pulverize, treat, bind, and load-out into containment the low-level
radioactive material. Should our proposal be accepted, we would envision
engineering and feasibility funds to be made available in November of 2000.
Construction and on-site operation would take place in 2001. The final scope
of this project for Terra Systems would be in the 5 million US dollar range
and take approximately 20 months to complete. This project could lead to
similar future clean-up activity with PSG, who contracts with Morrison-
Knudsen.
Liquidity and Capital Resources
Given Terra's current cash flows, it will be difficult for Terra Systems,
Inc. to continue as a going concern. While recent developments regarding
patent issuance will allow Terra Systems to more aggressively pursue revenue,
and cash, generating contracts by year-end 2000, it may be necessary to raise
additional funds and/or reduce cash expenditures in the next 12 months.
Funds could be generated through the issuance of additional stock, or through
the sale of existing plant and office equipment. Cash expenditures could be
reduced through the lay-off of personnel and the elimination of employee
benefits.
-11-
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings-None
Item 2. Changes in Securities and Use of Proceeds- None
Item 3. Defaults Upon Senior Securities- None
Item 4. Submission of Matters to a Vote of Security Holders- None
Item 5. Other Information- None
Item 6. Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed by the Registrant during the quarter
ended September 30, 2000.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TERRA SYSTEMS, INC.
(Registrant)
Date: November 13, 2000 /s/ Clayton Timothy
-----------------------------
Clayton Timothy
Chairman of the Board
Chief Executive Officer
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