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As filed with the Securities and Exchange Commission on May 23, 1997
Registration No. _______________
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
WESTERN TECHNOLOGY & RESEARCH, INC.
(Name of Small Business Issuer in its Charter)
Wyoming 83-0273780
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
801 East "A" Street, Casper, Wyoming 82601
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (307) 234-5310
Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
N/A N/A
Securities to be registered under Section 12(g) of the Act:
Common Stock, no par value per share
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(Title of Class)
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PAGE
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WESTERN TECHNOLOGY & RESEARCH, INC.
FORM 10-SB
TABLE OF CONTENTS
PART 1 Page
Item 1. Description of Business ..................................... 3
Item 2. Management's Discussion and Analysis or Plan of Operation ... 8
Item 3. Description of Property...................................... 9
Item 4. Security Ownership of Certain Beneficial Owners
and Management.............................................. 9
Item 5. Directors, Executive Officers, Promoters
and Control Persons......................................... 10
Item 6. Executive Compensation....................................... 12
Item 7. Certain Relationships and Related Transactions............... 12
Item 8. Description of Securities.................................... 12
PART II
Item 1. Market Price of and Dividends on the Registrant's
Common Equity and Other Shareholder Matters................. 14
Item 2. Legal Proceedings............................................ 15
Item 3. Changes in and Disagreements with Accountants................ 16
Item 4. Recent Sales of Unregistered Securities...................... 16
Item 5. Indemnification of Directors and Officers.................... 16
PART F/S
Financial Statements......................................... 17
PART III
Item 1. Index to Exhibits............................................ 28
Item 2. Description of Exhibits...................................... 28
PAGE
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PART I
Item 1. Description of Business
Business Development
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WESTERN TECHNOLOGY & RESEARCH, INC. (the "Company") was organized on
September 19, 1984 under the laws of the State of Wyoming, having the stated
purpose of engaging in any lawful activities. The Company was formed with the
contemplated purpose to engage in investment and business development
operations related to mineral research and exploration. The primary area of
mineral exploration concerned small (less than 10 acres) jade mining
leaseholds in Wyoming, which were never brought to the development stage. The
Company also held options on both minor gold and minor oil & gas prospects,
which were never exercised, and the options were assigned to third-parties for
nominal consideration. All these activities had ceased before 1990. All jade
mine claims were allowed to expire in 1993, for non-payment of rental fees, as
approved by unanimous action of the Board of Directors on August 19, 1993.
The Company never engaged in an active trade or business throughout the
period from 1990, until just recently. On October 15, 1996, the directors
determined that the Company should become active in seeking potential
operating businesses and business opportunities with the intent to acquire or
merge with such businesses. The Company then began to consider and
investigate potential business opportunities. The Company is considered a
development stage company and, due to its status as a "shell" corporation, its
principal business purpose is to locate and consummate a merger or acquisition
with a private entity. Because of the Company's current status having no
assets and no recent operating history, in the event the Company does
successfully acquire or merge with an operating business opportunity, it is
likely that the Company's present shareholders will experience substantial
dilution and there will be a probable change in control of the Company.
The Company is voluntarily filing its registration statement on Form
10-SB in order to make information concerning itself more readily available to
the public. Management believes that being a reporting company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), could
provide a prospective merger or acquisition candidate with additional
information concerning the Company. In addition, management believes that
this might make the Company more attractive to an operating business
opportunity as a potential business combination candidate. As a result of
filing its registration statement, the Company is obligated to file with the
Commission certain interim and periodic reports including an annual report
containing audited financial statements. The Company intends to continue to
voluntarily file these periodic reports under the Exchange Act even if its
obligation to file such reports is suspended under applicable provisions of
the Exchange Act.
Any target acquisition or merger candidate of the Company will become
subject to the same reporting requirements as the Company upon consummation of
any such business combination. Thus, in the event that the Company
successfully completes an acquisition or merger with another operating
business, the resulting combined business must provide audited financial
statements for at least the two most recent fiscal years or, in the event that
the combined operating business has been in business less than two years,
audited financial statements will be required from the period of inception of
the target acquisition or merger candidate.
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The Company's principal executive offices are located at 801 East "A"
Street, Casper, Wyoming, 82601, and its telephone number is (307) 234-5310.
Business of Issuer
The Company has no recent operating history and no representation is
made, nor is any intended, that the Company will be able to carry on future
business activities successfully. Further, there can be no assurance that the
Company will have the ability to acquire or merge with an operating business,
business opportunity or property that will be of material value to the
Company.
Management plans to investigate, research and, if justified, potentially
acquire or merge with one or more businesses or business opportunities. The
Company currently has no commitment or arrangement, written or oral, to
participate in any business opportunity and management cannot predict the
nature of any potential business opportunity it may ultimately consider.
Management will have broad discretion in its search for and negotiations with
any potential business or business opportunity.
Sources of Business Opportunities
The Company intends to use various sources in its search for potential
business opportunities including its officers and directors, consultants,
special advisors, securities broker-dealers, venture capitalists, members of
the financial community and others who may present management with unsolicited
proposals. Because of the Company's lack of capital, it may not be able to
retain on a fee basis professional firms specializing in business acquisitions
and reorganizations. Rather, the Company will most likely have to rely on
outside sources, not otherwise associated with the Company, that will accept
their compensation only after the Company has finalized a successful
acquisition or merger. To date, the Company has not engaged nor entered into
any definitive, agreements nor understandings regarding retention of any
consultant to assist the Company in its search for business opportunities, nor
is management presently in a position to actively seek or retain any
prospective consultants for these purposes.
The Company does not intend to restrict its search to any specific kind
of industry or business. The Company may investigate and ultimately acquire a
venture that is in its preliminary or development stage, is already in
operation, or in various stages of its corporate existence and development.
Management cannot predict at this time the status or nature of any venture in
which the Company may participate. A potential venture might need additional
capital or merely desire to have its shares publicly traded. The most likely
scenario for a possible business arrangement would involve the acquisition of,
or merger with, an operating business that does not need additional capital,
but which merely desires to establish a public trading market for its shares.
Management believes that the Company could provide a potential public vehicle
for a private entity interested in becoming a publicly held corporation
without the time and expense typically associated with an initial public
offering.
PAGE
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Evaluation
Once the Company has identified a particular entity as a potential
acquisition or merger candidate, management will seek to determine whether
acquisition or merger is warranted or whether further investigation is
necessary. Such determination will generally be based on management's
knowledge and experience, or with the assistance of outside advisors and
consultants evaluating the preliminary information available to them.
Management may elect to engage outside independent consultants to perform
preliminary analysis of potential business opportunities. However, because of
the Company's lack of capital it may not have the necessary funds for a
complete and exhaustive investigation of any particular opportunity.
In evaluating such potential business opportunities, the Company will
consider, to the extent relevant to the specific opportunity, several factors
including potential benefits to the Company and its shareholders; working
capital, financial requirements and availability of additional financing;
history of operation, if any; nature of present and expected competition;
quality and experience of management; need for further research, development
or exploration; potential for growth and expansion; potential for profits; and
other factors deemed relevant to the specific opportunity.
Because the Company has not located or identified any specific business
opportunity as of the date hereof, there are certain unidentified risks that
cannot be adequately expressed prior to the identification of a specific
business opportunity. There can be no assurance following consummation of any
acquisition or merger that the business venture will develop into a going
concern or, if the business is already operating, that it will continue to
operate successfully. Many of the potential business opportunities available
to the Company may involve new and untested products, processes or market
strategies which may not ultimately prove successful.
Form of Potential Acquisition or Merger
Presently, the Company cannot predict the manner in which it might
participate in a prospective business opportunity. Each separate potential
opportunity will be reviewed and, upon the basis of that review, a suitable
legal structure or method of participation will be chosen. The particular
manner in which the Company participates in a specific business opportunity
will depend upon the nature of that opportunity, the respective needs and
desires of the Company and management of the opportunity, and the relative
negotiating strength of the parties involved. Actual participation in a
business venture may take the form of an asset purchase, lease, joint venture,
license, partnership, stock purchase, reorganization, merger or consolidation.
The Company may act directly or indirectly through an interest in a
partnership, corporation, or other form of organization, however, the Company
does not intend to participate in opportunities through the purchase of
minority stock positions.
Because of the Company's current status and recent inactive status for
the prior eight years, and its concomitant lack of assets or relevant
operating history, it is likely that any potential merger or acquisition with
another operating business will require substantial dilution of the Company's
existing shareholders. There will probably be a change in control of the
Company, with the incoming owners of the targeted merger or acquisition
candidate taking over control of the Company. Management has not established
any guidelines as to the amount of control it will offer to prospective
business opportunity candidates, since this issue will depend to a large
degree on the economic strength and desirability of each candidate, and correspo
nding relative bargaining power of the parties. However, management will
endeavor to negotiate the best possible terms for the benefit of the Company's
shareholders as the case arises.
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Management does not have any plans to borrow funds to compensate any
persons, consultants, promoters, or affiliates in conjunction with its efforts
to find and acquire or merge with another business opportunity. Management
does not have any plans to borrow funds to pay compensation to any prospective
business opportunity, or shareholders, management, creditors, or other
potential parties to the acquisition or merger. In either case, it is
unlikely that the Company would be able to borrow significant funds for such
purposes from any conventional lending sources. In all probability, a public
sale of the Company's securities would also be unfeasible, and management does
not contemplate any form of new public offering at this time. In the event
that the Company does need to raise capital, it would most likely have to rely
on the private sale of its securities. Such a private sale would be limited
to persons exempt under the Commission's Regulation D or other rule or
provision for exemption, if any applies. However, no private sales are
contemplated by the Company's management at this time. If a private sale of
the Company's securities is deemed appropriate in the future, management will
endeavor to acquire funds on the best terms available to the Company.
However, there can be no assurance that the Company will be able to obtain
funding when and if needed, or that such funding, if available, can be
obtained on terms reasonable or acceptable to the Company. The Company does
not anticipate using Regulation S promulgated under the Securities Act of 1933
to raise any funds any time within the next year, subject only to its
potential applicability after consummation of a merger or acquisition.
Although not presently anticipated by management, there is a remote
possibility that the Company might sell its securities to its management or
affiliates.
In the event of a successful acquisition or merger, a finder's fee, in
the form of cash or securities of the Company, may be paid to persons
instrumental in facilitating the transaction. The Company has not established
any criteria or limits for the determination of a finder's fee, although most
likely an appropriate finder's fee will be negotiated between the parties,
including the potential business opportunity candidate, based upon economic
considerations and reasonable value as estimated and mutually agreed at that
time. A finder's fee would only be payable upon completion of the proposed
acquisition or merger in the normal case, and management does not contemplate
any other arrangement at this time. Management has not actively undertaken a
search for, nor retention of, any finder's fee arrangement with any person.
It is possible that a potential merger or acquisition candidate would have its
own finder's fee arrangement, or other similar business brokerage or
investment banking arrangement, whereupon the terms may be governed by a
pre-existing contract; in such case, the Company may be limited in its ability
to affect the terms of compensation, but most likely the terms would be
disclosed and subject to approval pursuant to submission of the proposed
transaction to a vote of the Company's shareholders. Management cannot
predict any other terms of a finder's fee arrangement at this time. It would
be unlikely that a finder's fee payable to an affiliate of the Company would
be proposed because of the potential conflict of interest issues. If such a
fee arrangement was proposed, independent management and directors would
negotiate the best terms available to the Company so as not to compromise the
fiduciary duties of the affiliate in the proposed transaction, and the Company
would require that the proposed arrangement would be submitted to the
shareholders for prior ratification in an appropriate manner.
PAGE
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Management does not contemplate that the Company would acquire or merge
with a business entity in which any affiliates of the Company have an
interest. Any such related party transaction, however remote, would be
submitted for approval by an independent quorum of the Board of Directors and
the proposed transaction would be submitted to the shareholders for prior
ratification in an appropriate manner. None of the Company's managers,
directors, or other affiliated parties have had any contact, discussions, or
other understandings regarding any particular business opportunity at this
time, regardless of any potential conflict of interest issues. Accordingly,
the potential conflict of interest is merely a remote theoretical possibility
at this time.
Rights of Shareholders
It is presently anticipated by management that prior to consummating a
possible acquisition or merger, the Company will seek to have the transaction
ratified by shareholders in the appropriate manner. Most likely, this would
require a general or special shareholder's meeting called for such purpose,
wherein all shareholder's would be entitled to vote in person or by proxy. In
the notice of such a shareholder's meeting and proxy statement, the Company
will provide shareholders complete disclosure documentation concerning a
potential acquisition of merger candidate, including financial information
about the target and all material terms of the acquisition or merger
transaction.
Competition
Because the Company has not identified any potential acquisition or
merger candidate, it is unable to evaluate the type and extent of its likely
competition. The Company is aware that there are several other public
companies with only nominal assets that are also searching for operating
businesses and other business opportunities as potential acquisition or merger
candidates. The Company will be in direct competition with these other public
companies in its search for business opportunities and, due to the Company's
lack of funds, it may be difficult to successfully compete with these other
companies.
Employees
As of the date hereof, the Company does not have any employees and has
no plans for retaining employees until such time as the Company's business
warrants the expense, or until the Company successfully acquires or merges
with an operating business. The Company may find it necessary to periodically
hire part-time clerical help on an as-needed basis.
Facilities
The Company is currently using as its principal place of business the
business offices of its President located in Casper, Wyoming. Although the
Company has no written agreement and pays no rent for the use of this
facility, it is contemplated that at such future time as an acquisition or
merger transaction may be completed, the Company will secure commercial office
space from which it will conduct its business. Until such an acquisition or
merger, the Company lacks any basis for determining the kinds of office space
or other facilities necessary for its future business. The Company has no
current plans to secure such commercial office space. It is also possible
that a merger or acquisition candidate would have adequate existing facilities
upon completion of such a transaction, and the Company's principal offices may
be transferred to such existing facilities.
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Industry Segments
No information is presented regarding industry segments. The Company is
presently a development stage company seeking a potential acquisition of or
merger with a yet to be identified business opportunity. Reference is made to
the statements of income included herein in response to Part F/S of this Form
10-SB for a report of the Company's operating history for the past two fiscal
years.
Item 2. Management's Discussion and Analysis or Plan of Operation
The Company is considered a development stage company with no assets or
capital and with no operations or income since approximately 1990. The costs
and expenses associated with the preparation and filing of this registration
statement and other operations of the Company have been paid for by a
shareholder and a consultant of the Company, specifically Zenith S. Merritt
and H. DeWorth Williams (see Item 4, Security Ownership of Certain Beneficial
Owners and Management - Z.S. Merritt is the controlling shareholder). It is
anticipated that the Company will require only nominal capital to maintain the
corporate viability of the Company and necessary funds will most likely be
provided by the Company's existing shareholders or its officers and directors
in the immediate future. However, unless the Company is able to facilitate an
acquisition of or merger with an operating business or is able to obtain
significant outside financing, there is substantial doubt about its ability to
continue as a going concern.
In the opinion of management, inflation has not and will not have a
material effect on the operations of the Company until such time as the
Company successfully completes an acquisition or merger. At that time,
management will evaluate the possible effects of inflation on the Company as
it relates to its business and operations following a successful acquisition
or merger.
Plan of Operation
During the next twelve months, the Company will actively seek out and
investigate possible business opportunities with the intent to acquire or
merge with one or more business ventures. In its search for business
opportunities, management will follow the procedures outlined in Item 1 above.
Because the Company lacks finds, it may be necessary for the officers and
directors to either advance funds to the Company or to accrue expenses until
such time as a successful business consolidation can be made. Management
intends to hold expenses to a minimum and to obtain services on a contingency
basis when possible. Further, the Company's directors will defer any
compensation until such time as an acquisition or merger can be accomplished
and will strive to have the business opportunity provide their remuneration.
However, if the Company engages outside advisors or consultants in its search
for business opportunities, it may be necessary for the Company to attempt to
raise additional funds. As of the date hereof, the Company has not made any
arrangements or definitive agreements to use outside advisors or consultants
or to raise any capital. In the event the Company does need to raise capital
most likely the only method available to the Company would be the private sale
of its securities. Because of the nature of the Company as a development stage
company, it is unlikely that it could make a public sale of securities or be
able to borrow any significant sum from either a commercial or private lender.
There can be no assurance that the Company will be able to obtain additional
funding when and if needed, or that such funding, if available, can be
obtained on terms acceptable to the Company.
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The Company does not intend to use any employees, with the possible
exception of part-time clerical assistance on an as-needed basis. Outside
advisors or consultants will be used only if they can be obtained for minimal
cost or on a deferred payment basis. Management is confident that it will be
able to operate in this manner and to continue its search for business
opportunities during the next twelve months.
Item 3. Description of Property
The information required by this Item 3 is not applicable to this Form
10-SB due to the fact that the Company does not own or control any material
property.
Item 4. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information, to the best knowledge of the
Company as of April 30, 1997, with respect to each person known by the Company
to own beneficially more than 5% of the Company's outstanding common stock,
each director of the Company and all directors and officers of the Company as
a group.
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class
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Z.S. Merritt 253,400 50.7%
801 East A Street
Casper, Wyoming 82601
Sharon K. Fowler 42,500 8.5%
M13740 Box 1
Evansville, Wyoming 82636
Donn Douglas 40,000 8.0%
6445 East Ohio Avenue, Suite 350
Denver, Colorado 80226
Michael Ford 40,000 8.0%
1001 East Bayaud #1402
Denver, Colorado 80209
H. Jean Baker & Phyllis L. Baker 32,500 6.5%
P.O. Box 1314
Riverton, Wyoming 82501
Management:
Z.S. Merritt 253,400 50.7%
801 East A Street
Casper, Wyoming 82601
Thomas M. Hockaday 500 0.1%
1560 Nottingham
Casper, Wyoming 82609
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Note: The Company has combined related parties for purposes of determining
beneficial ownership with regard to H. Jean Baker and Phyllis L. Baker, Sharon
K. Fowler, and Z. S. Merritt, above, to determine aggregate controlled
shares. The Company has been advised that each of the other persons listed
above has sole voting power over the shares indicated above. Percent of Class
(third column above) is based on 500,000 shares of common stock outstanding on
April 30, 1997.
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Item 5. Directors, Executive Officers, Promoters and Control Persons
The directors and executive officers of the Company and their respective ages
are as follows:
Name Age Position
- ---- --- --------
Zenith S. Merritt 69 President and Director
Thomas M. Hockaday 62 Secretary-Treasurer and Director
Jo Juliano-Smith 55 Director
All directors hold office until the next annual meeting of stockholders
and until their successors have been duly elected and qualified. There are no
agreements with respect to the election of directors. The Company has not
compensated its directors for service on the Board of Directors or any
committee thereof. As of the date hereof, no director has accrued any
expenses or compensation. Officers are appointed annually by the Board of
Directors and each executive officer serves at the discretion of the Board of
Directors. The Company does not have any standing committees at this time.
No director, officer, affiliate or promoter of the Company has, within
the past five years, filed any bankruptcy petition, been convicted in or been
the subject of any pending criminal proceedings, or is any such person the
subject or any order, judgment or decree involving the violation of any state
or federal securities laws.
The business experience of each of the persons listed above during the
past five years is as follows:
Z.S. Merritt has been President and a director of the Company since
December 15, 1994. For the last five years (and previously), Mr. Merritt has
also provided independent consulting services as a geologist and landman, as
well as acting as the owner and real estate broker for Merit Realty in Casper,
Wyoming. Mr. Merritt studied geology at the University of Wyoming, where he
received both a bachelor's and master's degree in geology.
Thomas M. Hockaday has been Vice President and a director of the Company
since December 15, 1994. For the last five years (and previously), Mr.
Hockaday worked as a real estate sales representative and investment advisor
for Merit Realty in Casper, Wyoming. Mr. Hockaday attended the Community
College of Cedar Rapids, Iowa, for two years, and has eighteen years of
continuing professional education in banking and financial studies.
Jo Juliano Smith has been a director of the Company since April 1, 1997.
She has over fifteen years of experience as a paralegal, and in recent years
has also worked as a substance abuse counselor. She has been educated at the
University of Utah.
PAGE
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Item 6. Executive Compensation
The Company has not had a bonus, profit sharing, or deferred compensation
plan for the benefit of its employees, officers or directors. The Company has
not paid any salaries or other compensation to its officers, directors or
employees for the years ended December 31, 1995 and 1996, nor at any time
during 1997. Further, the Company has not entered into an employment agreement
with any of its officers, directors or any other persons and no such
agreements are anticipated in the immediate future. It is intended that the
Company's directors will defer any compensation until such time as an
acquisition or merger can be accomplished and will strive to have the business
opportunity provide their remuneration. As of the date hereof, no person has
accrued any compensation from the Company.
Item 7. Certain Relationships and Related Transactions
During the Company's last two fiscal years, there have not been any
transactions between the Company and any officer, director, nominee for
election as director, or any shareholder owning greater than five percent (5%)
of the Company's outstanding shares, nor any member of the above referenced
individuals' immediate family.
Item 8. Description of Securities
Common Stock
The Company is authorized to issue 50,000,000 shares of common stock, no
par value, of which 500,000 shares are issued and outstanding as of the date
hereof. All shares of common stock have equal rights and privileges with
respect to voting, liquidation and dividend rights. Each share of common stock
entitles the holder thereof to (i) one non-cumulative vote for each share held
of record on all matters submitted to a vote of the stockholders; (ii) to
participate equally and to receive any and all such dividends as may be
declared by the Board of Directors out of funds legally available therefor;
and (iii) to participate pro rata in any distribution of assets available for
distribution upon liquidation of the Company. Stockholders of the Company have
no pre-emptive rights to acquire additional shares of common stock or any
other securities. The common stock is not subject to redemption and carries no
subscription or conversion rights. All outstanding shares of common stock are
fully paid and non-assessable.
Preferred Stock
The Company does not have any preferred stock, authorized or issued.
PART II
Item 10. Market Price of and Dividends on the Registrant's Common Equity and
Other Shareholder Matters
No shares of the Company's common stock have previously been registered
with the Securities and Exchange Commission (the "Commission") or any state
securities agency or authority. The Company has made an application to the
NASD for the Company's shares to be quoted on the OTC Bulletin Board. The
Company's application to the NASD consists of current corporate information,
financial statements and other documents as required by Rule 15c2-1-1 of the
Securities Exchange Act of 1934, as amended. Inclusion on the OTC Bulletin
Board permits price quotations for the Company's shares to be published by
such service.
<PAGE> 12
The Company's common shares are currently quoted at one-eighth (1/8th),
but there has not been any reported trading activity at that price. The
Company is not aware of any established trading market for its common stock
nor is there any record of any reported trades in the public market in recent
years. The Company's common stock has never traded in a public market since
1988.
If and when the Company's common stock is traded in the over-the-counter
market, most likely the shares will be subject to the provisions of Section
15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), commonly referred to as the "penny stock" rule. Section 15(g)
sets forth certain requirements for transactions in penny stocks and Rule
15g-9(d)(l) incorporates the definition of penny stock as that used in Rule
3a51-1 of the Exchange Act.
The Commission generally defines penny stock to be any equity security
that has a market price less than $5.00 per share, subject to certain
exceptions. Rule 3a51-1 provides that any equity security is considered to be
a penny stock unless that security is: registered and traded on a national
securities exchange meeting specified criteria set by the Commission;
authorized for quotation on The NASDAQ Stock Market; issued by a registered
investment company; excluded from the definition on the basis of price (at
least $5.00 per share) or the issuer's net tangible assets; or exempted from
the definition by the Commission. If the Company's shares are deemed to be a
penny stock, trading in the shares will be subject to additional sales
practice requirements on broker-dealers who sell penny stocks to persons other
than established customers and accredited investors, generally persons with
assets in excess of $1,000,000 or annual income exceeding $200,000, or
$300,000 together with their spouse.
For transactions covered by these rules, broker-dealers must make a
special suitability determination for the purchase of such securities and must
have received the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny stock, unless
exempt, the rules require the delivery, prior to the first transaction, of a
risk disclosure document relating to the penny stock market. A broker-dealer
also must disclose the commissions payable to both the broker-dealer and the
registered representative, and current quotations for the securities. Finally,
monthly statements must be sent disclosing recent price information for the
penny stocks held in the account and information on the limited market in
penny stocks. Consequently, these rules may restrict the ability of broker
dealers to trade and/or maintain a market in the Company's common stock and
may affect the ability of shareholders to sell their shares.
As of April 30, 1997 there were 43 holders of record of the Company's
common stock.
As of the date hereof, the Company has issued and outstanding 500,000
shares of common stock. Of this total, all shares were issued in transactions
more than three years ago. (A forward 5-for-1 stock split occurred on January
19, 1996, increasing the number of shares held by existing shareholders, which
is not deemed a "new" issuance.) Thus, all shares are deemed to have been
issued more than three years ago and may be sold or otherwise transferred
without restriction pursuant to the terms of Rule 144 ("Rule 144") of the
Securities Act of 1933, as amended (the "Act"), unless held by an affiliate or
controlling shareholder of the Company. Of these shares, the Company has
identified 253,900 shares as being held by affiliates of the Company. The
remaining 246,100 shares are deemed free from restrictions and may be sold
and/or transferred without further registration under the Act.
<PAGE> 13
The 253,900 shares presently held by affiliates or controlling
shareholders of the Company may be sold pursuant to Rule 144, subject to the
volume and other limitations set forth under Rule 144. In general, under Rule
144 as currently in effect, a person (or persons whose shares are aggregated)
who has beneficially owned restricted shares of the Company for at least two
years, including any person who may be deemed to be an "affiliate" of the
Company (as the term "affiliate" is defined under the Act), is entitled to
sell, within any three-month period, an amount of shares that does not exceed
the greater of (i) the average weekly trading volume in the Company's common
stock during the four calendar weeks preceding such sale, or (ii) 1% of the
shares then outstanding. A person who is not deemed to be an "affiliate" of
the Company and who has held restricted shares for at least three years would
be entitled to sell such shares without regard to the resale limitations of
Rule 144.
Dividend Policy
The Company has not declared or paid cash dividends or made distributions
in the past, and the Company does not anticipate that it will pay cash
dividends or make distributions in the foreseeable future. The Company
currently intends to retain and reinvest future earnings, if any, to finance
its operations.
Item 2. Legal Proceedings
The Company is currently not a party to any material pending legal
proceedings and no such action by, or to the best of its knowledge, against
the Company has been threatened. The Company was inactive from 1990 through
the present date of this Form 10-SB. A small prior judgment, as reported in
the balance sheet for 1996 (See Part F/S - notes payable of $16,047), has
since been settled and released in full. In the absence of any other known
litigation matters pending or threatened, the Company believes that all
litigation matters are currently resolved.
Item 3. Changes in and Disagreements with Accountants
Item 3 is not applicable to this Form 10-SB.
Item 4.Recent Sales of Unregistered Securities
All issues of securities by the Company were made more than three years
ago.
Item 5. Indemnification of Directors and Officers
The Company has not made any provision for the indemnification of its
officers or directors. The Articles of Incorporation and by-laws do not have
any provisions for indemnification. Neither the Company's Articles of
Incorporation nor by-laws makes provisions for the purchase of liability
insurance on behalf of its officers or directors. The Company does not
maintain any such liability insurance.
Transfer Agent
The Company has designated Interstate Transfer Company, 56 West 400
South, Suite 260, Salt Lake City, Utah, 84101, as its transfer agent.
<PAGE> 14
PART F/S
Financial Statements and Supplementary Data
The Company's financial statements for the years ended December 31, 1994,
1995, 1996 and February 28, 1997, have been examined to the extent indicated
in their reports by Jones, Jensen & Company, independent certified
accountants, and have been prepared in accordance with generally accepted
accounting principles and pursuant to Regulation S-B as promulgated by the
Securities and Exchange Commission and are included herein, on the following
twenty-seven (27) pages, in response to Part F/S of this Form 10-SB.
PART III
Item 1. Index to Exhibits
The following exhibits are filed with this Registration Statement:
Exhibit No. Exhibit Name
- ----------- ------------
2(I) Articles of Incorporation and all amendments pertaining thereto
2(ii) By-laws
4 Specimen Stock Certificate
Item 2. Description of Exhibits
See Item 1 above.
PAGE
<PAGE> 15
CONTENTS
WESTERN TECHNOLOGY & RESEARCH, INC.
FINANCIAL STATEMENTS
February 28, 1997 and December 31, 1996
Independent Auditors' Report................................................16
Balance Sheets..............................................................17
Statements of Operations....................................................18
Statements of Stockholders' Equity (Deficit)................................19
Statements of Cash Flows....................................................20
Notes to the Financial Statements...........................................21
CONTENTS
WESTERN TECHNOLOGY & RESEARCH, INC.
FINANCIAL STATEMENTS
August 15, 1996, December 31, 1995 and 1994
Independent Auditors' Report................................................23
Balance Sheets..............................................................24
Statements of Operations....................................................25
Statements of Stockholders' Equity (Deficit)................................26
Statements of Cash Flows....................................................27
Notes to the Financial Statements...........................................28
PAGE
<PAGE> 16
[Jones, Jensen & Company Letterhead]
Independent Auditors Report
- ---------------------------
The Board of Directors
Western Technology & Research, Inc.
(A Development Stage Company)
Casper, Wyoming
We have audited the accompanying balance sheets of Western Technology &
Research, Inc. (A Development Stage Company) as of February 28, 1997 and
December 31, 1996 and the related statements of operations, stockholders'
equity (deficit) and cash flows for the two months ended February 28, 1997 and
for the years ended December 31, 1996 and 1995 and from inception on September
19, 1984 through February 28, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial condition of Western Technology &
Research, Inc. (A Development Stage Company)as of February 28, 1997, and
December 31, 1996 and the results of its operations and its cash flows for the
two months ended February 28, 1997 and for the years ended December 31, 1996
and 1995 in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 5 to the
financial statements, the Company has incurred losses from its inception
through February 28, 1997 and it has not established revenues sufficient to
cover its operating costs and to allow it to continue as a going concern,
which raises substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 5. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/S/ Jones, Jensen & Company
- ------------------------------------
Jones, Jensen & Company
March 24, 1997
50 South Main Street, Suite 1450
Salt Lake City, Utah 84144
PAGE
<PAGE> 17
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Balance Sheets
<TABLE>
<CAPTION>
ASSETS
February 28, December 31,
1997 1996
------------- -------------
<S> <C> <C>
CURRENT ASSETS
Cash...................... $ - -
------------- -------------
Total Current Assets - -
------------- -------------
TOTAL ASSETS $ - $ -
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable.......... $ 143 $ 143
Current portion of notes
payable (Note 4) - 16,047
------------- -------------
Total Current Liabilities 143 16,190
------------- -------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, 50,000,000 shares
authorized at no par value,
500,000 shares issued
and outstanding 92,960 92,960
Deficit accumulated during
the development stage (93,103) (109,150)
------------- -------------
Total Stockholders'
Equity (Deficit) (143) (16,190)
------------- -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQITY (DEFICIT) $ - -
============= =============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 21
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
From Inception
For the
Two September 19,
Months Ended For the Years Ended
1984 through
February 28, December
31, February 28,
1997 1996
1995 1997
----------- ------------
- ------------ ------------
<S> <C> <C>
<C> <C>
REVENUE.................................. $ - $ - $
- - $ -
----------- ------------
- ------------ ------------
EXPENSES................................. - -
- - -
----------- ------------
- ------------ ------------
NET INCOME (LOSS) FROM OPERATIONS........ - -
- - -
----------- ------------
- ------------ ------------
GAIN (LOSS) ON DISCONTINUED OPERATIONS... 16,047 33,300
(3,253) (93,103)
----------- ------------
- ------------ ------------
INCOME (LOSS) PRIOR TO INCOME TAXES...... 16,047 33,300
(3,253) (93,103)
PROVISION FORM INCOME TAXES (NOTE 1)..... - -
- - -
----------- ------------
- ------------ ------------
NET INCOME (LOSS) $ 16,047 $ 33,300 $
(3,253) $ (93,103)
=========== ============
============ ============
NET LOSS PER SHARE....................... $ 0.03 $ 0.07 $
(0.00)
=========== ============
============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 19
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
<TABLE>
<CAPTION>
Deficit
Accumulated
Common
Stock During the
- ---------------------------- Development
Shares
Amount Stage
-----------
- ------------ ------------
<S> <C>
<C> <C>
Balance at inception, September 19, 1984 - $
- - $ -
Net income for the period ended December 31, 1984 -
- - -
-----------
- ------------ ------------
Balance, December 31, 1984 -
- - -
Common stock issued for cash at $0.10 per share 110,400
11,040 -
Common stock issued for cash at $0.20 per share 105,000
21,000 -
Common stock issued for debt at $0.20 per share 500
100 -
Net income the year ended December 31, 1985 -
- - 3,644
-----------
- ------------ ------------
Balance, December 31, 1985 215,900
32,140 3,644
Common stock issued for cash at $0.20 per share 40,000
8,000 -
Net loss for the year ended December 31, 1986 -
- - (5,461)
-----------
- ------------ ------------
Balance, December 31, 1986 255,900
40,140 (1,817)
Net loss for the year ended December 31, 1987 -
- - (10,815)
-----------
- ------------ ------------
Balance, December 31, 1987 255,900
40,140 (12,632)
Common stock issued for cash at $0.20 per share 15,000
3,000 -
Common stock issued for property at $0.20 per share 30,000
6,000 -
Net loss for year ended December 31, 1988 -
- - (20,494)
-----------
- ------------ ------------
Balance, December 31, 1988 300,900
49,140 (33,126)
Net loss for the year ended December 31, 1989 -
- - (30,603)
-----------
- ------------ ------------
Balance, December 31, 1989 300,900
49,140 (63,729)
Common stock issued for cash at $0.20 per share 5,000
1,000 -
Common stock issued in lieu of salary at $0.20
per share 10,000
2,000 -
Common stock issued for services at $0.20 per share 160,000
32,000 -
Common stock issued for note extension at $0.20
per share 5,000
1,000 -
Common stock issued for debt at $0.20 per share 6,600
1,320 -
Net loss for year ended December 31, 1990 -
- - (29,601)
-----------
- ------------ ------------
Balance, December 31, 1990 487,500
86,460 (93,330)
Net income for the year ended December 31, 1991 -
- - 1,504
-----------
- ------------ ------------
Balance, December 31, 1991 487,500
86,460 (91,826)
Net loss for the year ended December 31, 1992 -
- - (3,579)
-----------
- ------------ ------------
Balance, December 31, 1992 487,500
86,460 (95,405)
Net loss for the year ended December 31, 1993 -
- - (46,710)
-----------
- ------------ ------------
Balance, December 31, 1993 487,500
86,460 (142,115)
Common stock issued for cash payments made on
behalf of the Company at $0.20 per share 12,500
2,500 -
Net income for the year ended December 31, 1994 -
- - 2,918
-----------
- ------------ ------------
Balance, December 31, 1994 500,000
88,960 (139,197)
Net loss for the year ended December 31, 1995 -
- - (3,253)
-----------
- ------------ ------------
Balance, December 31, 1995 500,000
88,960 (142,450)
Services paid on the Company's behalf contributed
to capital -
4,000 -
Net income for the year ended December 31, 1996 -
- - 33,300
-----------
- ------------ ------------
Balance, December 31, 1996 500,000
92,960 (109,150)
Net income for the period ended February 28, 1997 -
- - 16,047
-----------
- ------------ ------------
Balance, February 28, 1997 500,000 $
92,960 $ (93,103)
===========
============ ============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
<PAGE> 20
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
From Inception
For the
two On September 19,
Months Ended For the Years
Ended 1984 through
February 28, December
31, February 28,
1997 1996
1995 1997
------------ -----------
- ----------- ------------
<S> <C> <C>
<C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 16,047 $ 33,300 $
(3,253) $ (93,103)
Adjustments to reconcile net income
to cash flows:
Depreciation - -
- - 36,988
(Gain) loss on disposal of assets - -
- - 35,779
Common stock issued for services - 4,000
- - 56,380
Interest accrued on note payable - 211
3,189 12,720
Income from debt release (16,142) (37,654)
- - (64,909)
Changes in operating assets and
Liabilities:
(Increase) decrease in accounts
receivable and related receivables - -
- - (9,599)
(Increase) decrease in inventory - -
- - (2,745)
(Increase) decrease in other assets - -
- - (105)
Increase (decrease) in accounts payable 95 143
- - 317
----------- -----------
- ----------- -----------
Net cash provided (used)
By Operating Activities - -
(64) (28,277)
----------- -----------
- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets - -
- - (63,617)
Sale of fixed assets - -
- - 3,300
----------- -----------
- ----------- -----------
Net cash provided (used)
By Investing Activities - -
- - (60,317)
----------- -----------
- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of note payable - -
- - (42,390)
Issuance of stock for cash - -
- - 36,580
Proceeds from note payable - -
- - 94,404
----------- -----------
- ----------- -----------
Net cash provided (used)
By Financing Activities - -
- - 88,594
----------- -----------
- ----------- -----------
NET INCREASE (DECREASE) IN CASH - -
(64) -
CASH AT BEGINNING OF PERIOD - -
64 -
----------- -----------
- ------------ -----------
CASH AT END OF PERIOD $ - $ - $
- - $ -
=========== ===========
============ ===========
CASH PAID DURING THE YEAR FOR:
Interest $ - $ - $
- - $ -
Income taxes $ - $ - $
- - $ -
NON CASH FINANCING ACTIVITIES
Issuance of stock for services $ - $ 4,000 $
- - $ 56,380
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 21
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Notes to the Financial Statements
February 28, 1997 and December 31, 1996
NOTE 1- ORGANIZATION AND DESCRIPTION OF BUSINESS
Western Technology & Research, Inc.,(The Company) was organized under the
laws of the State of Wyoming on September 19, 1984. The Company was
incorporated for the purpose of mineral research and development. The Company
is presently inactive and all assets have been disposed of, accordingly the
Company is classified as a development stage company.
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. Loss Per Share
The computation of loss per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.
c. Provision for Texas
At February 28, 1997 the Company has net operating loss carry forwards of
approximately $93,000 that may be offset against future taxable income through
2012. No tax benefit has been reported in the financial statements, because
the Company believes there is a 50% or greater chance the carry forwards are
offset by a valuation allowance of the same amount.
d. Cash Equivalents
The Company considers all highly investments with a maturity of three
months or less when purchased to be cash equivalents.
e. 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 and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
period. Actual results could differ from those estimates.
f. Forward Stock Split
On January 19, 1996, the Company's common stock was forward split on a 5
shares for 1 basis. The accompanying financial statements reflect the forward
stock split on a retroactive basis.
Note 3- DISCONTINUED OPERATIONS
During 1993 the Company discontinued operations, and was reclassified as
a development stage company. All revenues generated by the Company have been
netted against the expenses and are grouped into the discontinued operations
line on the statement of operations.
<PAGE> 22
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Notes to the Financial Statements
February 28, 1997 and December 31, 1996
NOTE 4- NOTES PAYABLE
February 28, December 31,
1997 1996
----------- -----------
Notes payable Physician's Reliance
Marketing Company, a default
judgement was entered on
September 2, 1994 (Note 6).
$ - $ 16,047
----------- -----------
$ - $ (16,047)
=========== ===========
NOTE 5- GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. The
Company has incurred losses from its inception through February 28, 1997. It
has not established revenues sufficient to cover its operating costs and to
allow it to continue as a going concern. Management intends to seed a merger
with an existing, operating company. Currently management is committed to
cover all operating and other costs until such a merger is complete.
NOTE 6- DEFAULT JUDGEMENT
On September 2, 1994 a default judgement was entered against the Company
be the United States Bankruptcy Court for the Northern District of Georgia,
Atlanta Division. The judgement calls for payment of the $10,000 principal,
plus pre-judgement interest in the amount of $3,106, plus attorney's fees in
the amount of $1,310, plus post-judgement interest from the date of the
judgement. The entire amount of the principal, fees and interest have been
outstanding from the date of the default judgement until the United States
Bankruptcy Court canceled the default judgement on February 28, 1997.
PAGE
<PAGE> 23
[Jones, Jensen & Company Letterhead]
Independent Auditors Report
- ---------------------------
The Board of Directors
Western Technology & Research, Inc.
(A Development Stage Company)
Casper, Wyoming
We have audited the accompanying balance sheets of Western Technology &
Research, Inc. (A Development Stage Company) as of August 15, 1996 and
December 31, 1995 and the related statements of operations, stockholders'
equity (deficit) and cash flows for the period ended August 15, 1996 and the
years ended December 31, 1995 and 1994 and from inception on September 19,
1984 through August 15, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial condition of Western Technology &
Research, Inc. (A Development Stage Company)as of August 15, 1996 and December
31, 1995 and the results of its operations and its cash flows for the period
ended August 15, 1996 and for the years ended December 31, 1995 and 1994 in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements, the Company has incurred losses from its inception
through August 15, 1996 and it has not established revenues sufficient to
cover its operating costs and to allow it to continue as a going concern,
which raises substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 6. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/S/ Jones, Jensen & Company
- ------------------------------------
Jones, Jensen & Company
August 19, 1996
50 South Main Street, Suite 1450
Salt Lake City, Utah 84144
PAGE
<PAGE> 24
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Balance Sheets
<TABLE>
<CAPTION>
ASSETS
August 15, December 31,
1996 1995
------------- -------------
<S> <C> <C>
CURRENT ASSETS
Cash...................... $ - -
------------- -------------
Total Current Assets - -
------------- -------------
TOTAL ASSETS $ - $ -
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable.......... $ - $ 175
Accrued interest payable
(Note 5)................. - 7,187
Current portion of notes
payable (Note 4)......... 15,836 15,322
------------- -------------
Total Current Liabilities 15,836 22,684
------------- -------------
LONG-TERM DEBT
(Notes 4, 5 and 7) ....... - 30,806
------------- -------------
Total Liabilities 15,836 53,490
------------- -------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, 50,000,000 shares
authorized at no par value,
500,000 shares issued
and outstanding 88,960 88,960
Deficit accumulated during
the development stage (104,796) (142,450)
------------- -------------
Total Stockholders'
Equity (Deficit) (15,836) (53,490)
------------- -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQITY (DEFICIT) $ - -
============= =============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 25
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
From Inception
For
the September 19,
Period Ended For the Years
Ended 1984 through
August 15, December
31, August 15,
1996 1995
1994 1996
----------- ------------
- ------------ ------------
<S> <C> <C>
<C> <C>
REVENUE.................................. $ - $ - $
- - $ -
----------- ------------
- ------------ ------------
EXPENSES................................. - -
- - -
----------- ------------
- ------------ ------------
NET INCOME (LOSS) FROM OPERATIONS........ - -
- - -
----------- ------------
- ------------ ------------
GAIN (LOSS) ON DISCONTINUED OPERATIONS... 37,654 (3,253)
2,918 (104,796)
----------- ------------
- ------------ ------------
INCOME (LOSS) PRIOR TO INCOME TAXES...... 37,654 (3,253)
2,918 (104,796)
PROVISION FORM INCOME TAXES (NOTE 1)..... - -
- - -
----------- ------------
- ------------ ------------
NET INCOME (LOSS) $ 37,654 $ (3,253) $
2,918 $ (104,796)
=========== ============
============ ============
NET LOSS PER SHARE....................... $ 0.08 $ (0.00) $
(0.02)
=========== ============
============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 26
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
<TABLE>
<CAPTION>
Deficit
Accumulated
Common
Stock During the
- ---------------------------- Development
Shares Amount
Stage
-----------
- ------------ ------------
<S> <C>
<C> <C>
Balance at inception, September 19, 1984 - $
- - $ -
Net income for the period ended December 31, 1984 -
- - -
-----------
- ------------ ------------
Balance, December 31, 1984 -
- - -
Common stock issued for cash at $0.10 per share 110,400
11,040 -
Common stock issued for cash at $0.20 per share 105,000
21,000 -
Common stock issued for debt at $0.20 per share 500
100 -
Net income the year ended December 31, 1985 -
- - 3,644
-----------
- ------------ ------------
Balance, December 31, 1985 215,900
32,140 3,644
Common stock issued for cash at $0.20 per share 40,000
8,000 -
Net loss for the year ended December 31, 1986 -
- - (5,461)
-----------
- ------------ ------------
Balance, December 31, 1986 255,900
40,140 (1,817)
Net loss for the year ended December 31, 1987 -
- - (10,815)
-----------
- ------------ ------------
Balance, December 31, 1987 255,900
40,140 (12,632)
Common stock issued for cash at $0.20 per share 15,000 3,000
-
Common stock issued for property at $0.20 per share 30,000
6,000 -
Net loss for year ended December 31, 1988 -
- - (20,494)
-----------
- ------------ ------------
Balance, December 31, 1988 300,900
49,140 (33,126)
Net loss for the year ended December 31, 1989 -
- - (30,603)
-----------
- ------------ ------------
Balance, December 31, 1989 300,900
49,140 (63,729)
Common stock issued for cash at $0.20 per share 5,000
1,000 -
Common stock issued in lieu of salary at $0.20
per share 10,000
2,000 -
Common stock issued for services at $0.20 per share 160,000
32,000 -
Common stock issued for note extension at $0.20
per share 5,000
1,000 -
Common stock issued for debt at $0.20 per share 6,600
1,320 -
Net loss for year ended December 31, 1990 -
- - (29,601)
-----------
- ------------ ------------
Balance, December 31, 1990 487,500
86,460 (93,330)
Net income for the year ended December 31, 1991 -
- - 1,504
-----------
- ------------ ------------
Balance, December 31, 1991 487,500
86,460 (91,826)
Net loss for the year ended December 31, 1992 -
- - (3,579)
-----------
- ------------ ------------
Balance, December 31, 1992 487,500
86,460 (95,405)
Net loss for the year ended December 31, 1993 -
- - (46,710)
-----------
- ------------ ------------
Balance, December 31, 1993 487,500
86,460 (142,115)
Common stock issued for cash payments made on
behalf of the Company at $0.20 per share 12,500
2,500 -
Net income for the year ended December 31, 1994 -
- - 2,918
-----------
- ------------ ------------
Balance, December 31, 1994 500,000
88,960 (139,197)
Net loss for the year ended December 31, 1995 -
- - (3,253)
-----------
- ------------ ------------
Balance, December 31, 1995 500,000
88,960 (142,450)
Net income for the period ended
August 15, 1996 -
- - 37,654
-----------
- ------------ ------------
Balance, August 15, 1996 500,000
88,960 (142,450)
===========
============ ============
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
<PAGE> 27
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
From Inception
For
the On September 19,
Period Ended For the Years
Ended 1984 through
August 15, December
31, August 15,
1996 1995
1994 1996
------------ -----------
- ----------- ------------
<S> <C> <C>
<C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 37,654 $ (3,253) $
2,918) $ (104,796)
Adjustments to reconcile net income
to cash flows:
Depreciation - -
- - 36,988
(Gain) loss on disposal of assets - -
42,022 35,779
Common stock issued for services - -
2,500 52,380
Interest accrued on note payable 1,644 3,189
7,061 14,153
Income from debt release (39,298) -
(11,208) (50,506)
Changes in operating assets and
Liabilities:
(Increase) decrease in accounts
receivable and related receivables - -
- - (9,599)
(Increase) decrease in inventory - -
- - (2,745)
(Increase) decrease in other assets - -
- - (105)
Increase (decrease) in accounts payable - -
(2,448) 174
----------- -----------
- ----------- -----------
Net cash provided (used)
By Operating Activities - (64)
40,845 (28,277)
----------- -----------
- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets - -
- - (63,617)
Sale of fixed assets - -
- - 3,300
----------- -----------
- ----------- -----------
Net cash provided (used)
By Investing Activities - -
- - (60,317)
----------- -----------
- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of note payable - -
(40,847) (42,390)
Issuance of stock for cash - -
- - 36,580
Proceeds from note payable - -
- - 94,404
----------- -----------
- ----------- -----------
Net cash provided (used)
By Financing Activities - -
(40,847) 88,594
----------- -----------
- ----------- -----------
NET INCREASE (DECREASE) IN CASH - (64)
(2) -
CASH AT BEGINNING OF PERIOD - 64
66 -
----------- -----------
- ------------ -----------
CASH AT END OF PERIOD $ - $ - $
64 $ -
=========== ===========
============ ===========
CASH PAID DURING THE YEAR FOR:
Interest $ - $ - $
50 $ -
Income taxes $ - $ - $
- - $ -
NON CASH FINANCING ACTIVITIES
Issuance of stock for services $ - $ - $
2,500 $ 52,380
</TABLE>
[The accompanying notes are an integral part of these financial statements.]
PAGE
<PAGE> 28
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Notes to the Financial Statements
August 15, 1996 and December 31, 1995
NOTE 1- ORGANIZATION AND DESCRIPTION OF BUSINESS
Western Technology & Research, Inc.,(The Company) was organized under the
laws of the State of Wyoming on September 19, 1984. The Company was
incorporated for the purpose of mineral research and development. The Company
is presently inactive and all assets have been disposed of, accordingly the
Company is classified as a development stage company.
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. Loss Per Share
The computation of loss per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.
c. Provision for Texas
At August 15, 1996 the Company has net operating loss carry forwards of
approximately $89,000 that may be offset against future taxable income through
2010. No tax benefit has been reported in the financial statements, because
the Company believes there is a 50% or greater chance the carry forwards are
offset by a valuation allowance of the same amount.
d. Cash Equivalents
The Company considers all highly investments with a maturity of three
months or less when purchased to be cash equivalents.
e. 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 and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
period. Actual results could differ from those estimates.
f. Forward Stock Split
On December 27, 1995, the Company's common stock was forward split on a 5
shares for 1 basis. The accompanying financial statements reflect the forward
stock split on a retroactive basis.
Note 3- DISCONTINUED OPERATIONS
During 1993 the Company discontinued operations, and was reclassified as
a development stage company. All revenues generated by the Company have been
netted against the expenses and are grouped into the discontinued operations
line on the statement of operations.
<PAGE> 29
WESTERN TECHNOLOGY & RESEARCH, INC.
(A Development Stage Company)
Notes to the Financial Statements
August 15, 1996 and December 31, 1995
NOTE 4- NOTES PAYABLE
August 15, December 31,
1996 1995
----------- -----------
Note payable to The Hawks Company
bearing interest at 8%, is due on
demand and is unsecured. $ - $ 30,806
Notes payable Physician's Reliance
Marketing Company, a default
judgement was entered on
September 2, 1994 (Note 6). 15,836 15,322
---------- ----------
Less Current Portion (15,836) (15,322)
---------- ----------
$ (15,836) $ 30,806
========== ==========
NOTE 5- RELEASE OF DEBT
On May 20, 1996 the Hawks Company discharged the Company of any and all
liability on the agreement and the note in the amount of $30,806, plus any
accumulated interest.
NOTE 6- GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. The
Company has incurred losses from its inception through August 15, 1996. It has
not established revenues sufficient to cover its operating costs and to allow
it to continue as a going concern. Management intends to seed a merger with an
existing, operating company. Currently management is committed to cover all
operating and other costs until such a merger is complete.
NOTE 7- DEFAULT JUDGEMENT
On September 2, 1994 a default judgement was entered against the Company
be the United States Bankruptcy Court for the Northern District of Georgia,
Atlanta Division. The judgement calls for payment of the $10,000 principal,
plus pre-judgement interest in the amount of $3,106, plus attorney's fees in
the amount of $1,310, plus post-judgement interest from the date of the
judgement. The entire amount of the principal, fees and interest have been
outstanding from the date of the default judgement and are currently due in
full.
PAGE
<PAGE> 30
PART III
Item 1. Index to Exhibits
The following exhibits are filed with this Registration Statement:
Exhibit No. Exhibit Name
----------- ------------
2(i) Articles of Incorporation and all
amendments pertaining thereto
2(ii) By-laws
4 Specimen Stock Certificate
27 Financial Data Schedule
Item 2. Description of Exhibits
See Item 1 above.
PAGE
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
WESTERN TECHNOLOGY & RESEARCH, INC.
(Registrant)
By: /s/ Zenith S. Merritt
-----------------------------------
Date: May __, 1997 ZENITH S. MERRITT, President
<PAGE> 1
Exhibit No. 2(i) Articles of Incorporation and all amendments
pertaining thereto
STATE OF WYOMING
OFFICE OF THE
SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
WESTERN TECHNOLOGY & RESEARCH, INC.
I, THYRA THOMSON, Secretary of State of the State of Wyoming, hereby
certify that the prerequisites for the issuance of this certificate have been
fulfilled in compliance with law, and are found to conform to law.
ACCORDINGLY, the undersigned, by virtue of the authority vested in me by
law, hereby issues this Certificate. office.
[Great Seal of the State of Wyoming]
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the Great
Seal of the State of Wyoming. Done at Cheyenne, the Capital, this nineteenth
day of September A.D. 1984.
/S/ Thyra Thomson
- ------------------------------------
Secretary of State
By: /S/[illegible signature]
PAGE
<PAGE> 2
ARTICLES OF INCORPORATION
OF
WESTERN TECHNOLOGY & RESEARCH, INC.
We, the undersigned natural persons of the age of 21 years or more acting
as incorporators of a corporation under the Wyoming Business Corporation Act,
adopt the following Articles of Incorporation for such corporation:
FIRST: The name of the corporation is WESTERN TECHNOLOGY & RESEARCH, INC.
SECOND: The period of duration is perpetual.
THIRD: The corporation shall have unlimited power to engage in and to do
any lawful act concerning any and all lawful businesses for which corporations
may be organized under the Wyoming Business Corporation Act.
FOURTH: The aggregate number of shares which the corporation shall have
the authority to issue shall be 100,000 shares of Common Stock with no per
value to be voting stock, fully non-assessable.
FIFTH: The corporation will not commence business until consideration of
the value of at least $500.00 has been received for the issuance of shares.
SIXTH: There are no provisions limiting or denying the shareholders the
preemptive right to acquire additional or treasury shares of the corporation.
SEVENTH: There are no provisions for the regulation of the internal
affairs of the corporation.
EIGHT: The address of the initial registered office of the corporation is
513 East Main Street, Riverton, Wyoming 82501. The name of its registered
agent at such address is NetteBall Girard Lanson.
NINTH: The number of directors constituting the initial Board of
Directors of the corporation is two (2), and the name and address of the
persons who are to serve as directors until the first annual meeting of
shareholders, or until their successors are elected and qualified are:
H. Jean Baker 735 East Sunset #1, Riverton, WY
Phyllis L. Baker 735 East Sunset #1, Riverton, WY
TENTH: The number of directors to be elected at the annual meetings of
shareholders next following the time when the shares of the corporation become
owned beneficially or of record by more than two (2) shareholders, or at a
special meeting called for the election of the directors after such time, is
three (3).
ELEVENTH: The name and address of each incorporator is:
H. Jean Baker 735 East Sunset #1, Riverton, WY
Phyllis L. Baker 725 East Sunset #1, Riverton, WY
Incorporation in duplicate on this 17th day of September, 1984.
/S/ H. Jean Baker
/S/ Phyllis L. Baker
<PAGE> 3
STATE OF WYOMING )
) SS.
COUNTY OF FREMONT )
On this 11th day of September , 1984, before me personally appeared H.
Jean Baker, who being by me duly sworn did say that he is the person who
executed the foregoing instrument as an incorporator, and that the statements
therein contained are true to his best knowledge or belief.
/S/ Deborah L. Halpain
Notary Public
My Commission Expires: Mar. 9, 1986
STATE OF COLORADO )
) ss.
COUNTY OF CLEARCREEK )
On this 17th day of September, 1994, before me personally appeared
Phyllis L. Baker, who being by me duly sworn did say that she is the person
who executed the foregoing instrument as ans incorporator, and that the
statements therein contained are true to her knowledge or belief.
/S/ Krista A. Whittle
Notary Public
15th & Miner, Idaho Springs, CO
My Commission Expires: 9/12/87
PAGE
<PAGE> 4
AMENDMENT TO ARTICLES OF INCORPORATION
FOR
WESTERN TECHNOLOGY & RESEARCH, INC.
Pursuant to the provisions of the Wyoming Business Corporation Act. The
undersigned corporation hereby adopts the following Articles of Amendment to
it's Articles of Incorporation.
FIRST: The name of the corporation is WESTERN TECHNOLOGY & RESEARCH, INC.
SECOND: The following amendment to the Articles of Incorporation was duly
adopted by the shareholders of the Corporation. Article IV of the Articles of
Incorporation is hereby amended as follows:
ARTICLE IV
AUTHORIZED CAPITAL
That the authorized capital of the Company be Fifty Million (50,000,000)
shares of common stock with no par value, non-assessable.
THIRD: The foregoing amendment to the Articles of Incorporation was
adopted by the shareholders of the corporation on the 19th day of January,
1996 in the manner prescribed by the laws of the State of Wyoming.
FOURTH: The number of shares outstanding on said date was 100,000 shares
and the number of shares entitled to vote, therefore, was 100,000 shares.
FIFTH: The number of shares voted for said was 100,000 shares and the
number of shares voted against such amendment was zero shares.
April 9, 1994
BY:/S/ Z. S. Merritt, President & CEO
STATE OF WYOMING )
) ss.
COUNTY OF NATRONA )
On this 9th day of April, 1996, before me personally appeared Z. S.
Merritt, who being by me duly sworn, did say that he is the person who
executed the foregoing instrument as an incorporator, and that the statements
therein contained are true to the best of his knowledge or belief.
/S/ Thomas M. Hocksday
Notary Public
My Commission Expires: 9/11/99
Exhibit No. 2(ii)
<PAGE> 1
BYLAWS
OF
WESTERN TECHNOLOGY & RESEARCH, INC.
ARTICLES I. OFFICES
The principal office of the Corporation in the State of Wyoming shall be
located at Riverton, Fremont County, Wyoming. The Corporation may have such
other offices within the State of Wyoming, as the Board of Directors may
designate or as the business of the Corporation may require from time to time.
ARTICLE II. SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of the shareholders shall
be held on the second Monday of September of each year, beginning with the
year 1985, at the hour of 2:00 p.m., in the City of Riverton, State of
Wyoming, for the purpose of electing Directors and for the transaction of such
other business as may come before the meeting.
Section 2. Notice. A notice setting out the time and place of such
annual meeting shall be mailed to each shareholder of record of his last known
address, at least ten (10) days prior to the annual meeting.
Section 3. Special Meetings. Special meetings of the shareholders shall
be held at the same place as the annual meeting as herein provided. Such
meetings may be called at any time by the President, any two Directors or the
holders of one-half (½) of the outstanding shares of the capital stock of
the Corporation. A notice setting out the time and place of such special
meeting shall be mailed to each shareholder of record at his last known
address, at lest ten (10) days prior to the special meeting.
Section 4. Quorum. A majority of the stock issued and outstanding shall
constitute a quorum for the transaction of business at any meeting of the
shareholders.
Section 5. Voting. Each shareholder shall be entitled to one vote for
each share of stock in his own name on the books of the Corporation whether
represented in person or by proxy. All proxies shall be in writing and
properly signed.
ARTICLE III. STOCK
Section 1. Certificate. Certificate of stock shall be in a form adopted
by the Board of Directors and signed by the Secretary-Treasurer and shall be
attested by the Corporate Seal.
Section 2. Number of Certificates. All certificates shall be
consecutively numbered. The name of the person owning the shares represented
thereby, with a number of such shares and the date of issue, shall be entered
on the Corporation's books.
Section 3. Transfer of Certificates [Repealed by Board on 10/15/96]
PAGE
<PAGE> 2
Section 4. Lost certificates. A duplicate certificate may be issued in
replacement of a lost, stolen or destroyed certificate only after receipt of
shareholder's Affidavit in the format required by the Board of Directors, and
after the shareholder requesting such replacement certificate files a bond in
the amount and form satisfactory to the Board of Directors.
ARTICLE IV. DIRECTORS
Section 1. Election, Number and Tenure. The Board of Directors shall be
chosen annually by the shareholders at their annual meeting to manage the
affairs of the Corporation. Their term of office shall be for one year or
until their Successors are so chosen.
Section 2. Vacancies. Vacancies in the Board of Directors for reason of
death, resignation or other causes shall be filled by the remaining Directors
choosing from among the shareholders a Director to fill the unexpired term.
Section 3. Regular Meetings. Regular meetings of the Board of Directors
shall be held without notice other than this Bylaw immediately after and at
the same place as the annual meeting of shareholders. The Board of directors
may provide by resolution, the time and place for holding additional regular
meetings without other notices than such resolution.
Section 4. Duties. The Directors shall have the general management and
control of the business and affairs of the Corporation and shall exercise all
the powers that may be exercised or performed by the Corporation under the
Wyoming Business Corporation Act, the articles of Incorporation and the
Bylaws. The act of the majority of the Directors at any meeting shall be the
act of the Board of Directors.
ARTICLE V. OFFICERS
Section 1. Number. The officers of the Corporation shall be a President,
and Secretary-Treasurer, each of whom shall be elected by the Board of
Directors. Such other officers and assistant officers as may be deemed
necessary may be elected or appointed by the Board of Directors.
Section 2. Duties of the President. The President shall preside at all
meetings of the Directors and shareholders and shall have general charges of
and control over the affairs of the Corporation subject to a Board of
Directors. The President may sign checks and execute contracts and make loans
on behalf of the Corporation.
Section 3. Duties of the Secretary-Treasurer. The Secretary-Treasurer
shall sign all certificates of stock of the Corporation; shall keep a record
of the minutes of the proceedings of meetings of Shareholders and Directors;
shall give notice as required in these Bylaws of all special meetings and
shall have custody of all books, records and papers of the Corporation.
Section 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the
board of Directors for the unexpired deration of the term.
Section 5. Removal. Any officer or assistant officer elected or
appointed by the Board of Directors may be removed by the Board whenever in
its judgment the best interests of the Corporation would be served thereby.
<PAGE> 3
ARTICLE VI. CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 1. Contracts. The Board of Directors may authorize any officer
or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the Corporation, and
such authority may be general or confined to specific instances, as designated
by resolution of the Board.
Section 2. Loans. Only the President may execute loans on behalf of the
Corporation. No other loans shall be contracted on behalf of the Corporation
and no evidence of indebtedness shall be issued in its name by any other
officers unless authorized by a resolution of the Board of Directors. Such
authority may be general or confined to specific instances.
Section 3. Checks, Drafts, Etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the Corporation, shall be signed by the President unless otherwise
determined by resolution of the Board of Directors.
Section 4. Deposits. All funds of the Corporation not otherwise employed
shall be deposited in such bank or banks as may be designated from time to
time by the Board of Directors.
ARTICLE VII. FISCAL YEAR
The fiscal year of the Corporation shall begin on the first day of
January and end on the last day of December of each year.
ARTICLE VIII. DIVIDENDS
The Board of Directors may from time to time declare, and the Corporation
may pay, dividends on its outstanding shares in the manner and upon the terms
and conditions provided by law.
ARTICLE IX. SEAL
The Corporation Seal of this Corporation shall be a circular seal
inscribed thereon with the bane of the Corporation, and the state of
incorporation and the words, "Corporation Seal". The seal shall be stamped or
affixed to such documents as may be prescribed by law of custom or by the
Board of Directors.
ARTICLE X. NOTICE OF WAIVER
Whenever any notice is required to be given to any shareholder or
directors of the Corporation under the Provisions of these Bylaws, under the
provisions of the Wyoming Business Corporation Act, a Waiver thereof in
writing, signed by the time stated therein, shall be deemed equivalent to the
giving of such notice.
ARTICLE XI. AMENDMENTS
The Bylaws may be altered, amended or repealed and new Bylaws may be
adopted by the Board of Directors at any regular or special meeting of the
Board of Directors.
/S/ H. Jean Baker, Secretary-Treasurer
<PAGE>
Exhibit No. 4 - SPECIMEN STOCK CERTIFICATE
INCORPORATED UNDER THE LAWS OF
WYOMING
No. SPECIMEN SHARES: SPECIMEN
WESTERN TECHNOLOGY & RESEARCH, INC.
Riverton, Wyoming
This Certifies that ----------SPECIMEN-------------- is the owner of
- --------------------VOID-------------------- Shares of the Capital Stock of
WESTERN TECHNOLOGY & RESEARCH, INC., transferable only on the books of the
Corporation by the holder hereof in person or by Attorney upon surrender of
this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and to be sealed with the Seal of the
Corporation this ----- day of ----------- A.D. 19xx.
/s/---------------------- [Corporate Seal] /s/-------------------------
President Secretary-Treasurer
SHARES
No Par Value
EACH
[ARTICLE] 5
[CIK] 0001035901
[NAME] WESTERN TECHNOLOGY & RESEARCH INC.
<TABLE>
<S> <C> <C>
[PERIOD-TYPE] 2-MOS 12-MOS
[FISCAL-YEAR-END] DEC-31-1997 DEC-31-1996
[PERIOD-END] FEB-28-1997 DEC-31-1996
[CASH] 0 0
[SECURITIES] 0 0
[RECEIVABLES] 0 0
[ALLOWANCES] 0 0
[INVENTORY] 0 0
[CURRENT-ASSETS] 0 0
[PP&E] 0 0
[DEPRECIATION] 0 0
[TOTAL-ASSETS] 0 0
[CURRENT-LIABILITIES] 143 16,190
[BONDS] 0 0
[PREFERRED-MANDATORY] 0 0
[PREFERRED] 0 0
[COMMON] 92,960 92,960
[OTHER-SE] (93,103) (109,150)
[TOTAL-LIABILITY-AND-EQUITY] 0 0
[SALES] 0 0
[TOTAL-REVENUES] 0 0
[CGS] 0 0
[TOTAL-COSTS] 0 0
[OTHER-EXPENSES] 0 0
[LOSS-PROVISION] 0 0
[INTEREST-EXPENSE] 0 0
[INCOME-PRETAX] 0 0
[INCOME-TAX] 0 0
[INCOME-CONTINUING] 0 0
[DISCONTINUED] 16,047 33,300
[EXTRAORDINARY] 0 0
[CHANGES] 0 0
[NET-INCOME] 16,047 33,300
[EPS-PRIMARY] 0.03 0.07
[EPS-DILUTED] 0.03 0.07
</TABLE>
