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
Water Petroleum and Environmental Technologies Company
(Name of Small Business Issuer in its charter)
Nevada
04-3365594
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5882 S. 900 E., Suite 202, Salt Lake City, Utah 84117
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: 801-269-9500
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
_____________________________ ______________________________
_____________________________ ______________________________
Securities to be registered under Section 12(g) of the Act:
Common, $.0001 par value
(Title of Class)
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INFORMATION REQUIRED IN REGISTRATION STATEMENT
This Form 10-SB contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform
Act of 1995. For this purpose any statements contained in this
Form 10-SB that are not statements of historical fact may be
deemed to be forward-looking statements. Without limiting the
foregoing, words such as Amay,@ Awill,@ Aexpect,@ Abelieve,@
Aanticipate,@ Aestimate@ or Acontinue@ or comparable terminology
are intended to identify forward-looking statements. These
statements by their nature involve substantial risks and
uncertainties, and actual results may differ materially depending
on a variety of factors, many of which are not within the
Company's control. These factors include but are not limited to
economic conditions generally and in the industries in which the
Company may participate; competition within the Company's chosen
industry, including competition from much larger competitors;
technological advances and failure by the Company to successfully
develop business relationships.
PART I
Item 1. Description of Business.
Water Petroleum & Environmental Technologies Company,
(AWTPE@ or the ACompany@) was originally incorporated in Nevada
on April 24, 1997 for the purpose of developing a patent to be
used in the field of water petroleum separation. The Company was
not successful in its intended business operations and became
inactive after 1998.
The Company has not had active business operations since
1998 and is considered a development stage company. The Company
intends to seek, investigate, and if warranted, acquire an
interest in a business opportunity. The Company does not propose
to restrict its search for a business opportunity to any
particular industry or geographical area and may, therefore,
engage in essentially any business in any industry. The Company
has unrestricted discretion in seeking and participating in a
business opportunity, subject to the availability of such
opportunities, economic conditions and other factors.
The selection of a business opportunity in which to
participate is complex and extremely risky and will be made by
management in the exercise of its business judgment. There is no
assurance that the Company will be able to identify and acquire
any business opportunity which will ultimately prove to be
beneficial to the Company and its shareholders.
The activities of the Company are subject to several
significant risks which arise primarily as a result of the fact
that the Company has no specific business and may acquire or
participate in a business opportunity based on the decision of
management which will, in all probability, act without the
consent, vote, or approval of the Company's shareholders.
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Reports to Security Holders
Prior to the filing of this registration statement on Form
10-SB, the Company was not subject to the reporting requirements
of Section 12(a) or 15(d) of the Exchange Act. Upon
effectiveness of this registration statement, the Company will
file annual and quarterly reports with the Securities and
Exchange Commission (ASEC@). The public may read and copy any
materials filed by the Company with the SEC at the SEC's Public
Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549.
The public may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. The Company
is an electronic filer and the SEC maintains an Internet site
that contains reports and other information regarding the Company
which may be viewed at http://www.sec.gov.
Sources of Opportunities
It is anticipated that business opportunities may be
available to the Company from various sources, including its
officers and directors, professional advisers, securities broker-
dealers, venture capitalists, members of the financial community,
and others who may present unsolicited proposals.
The Company will seek a potential business opportunity from
all known sources, but will rely principally on personal contacts
of its officers and directors as well as indirect associations
between them and other business and professional people.
Although the Company does not anticipate engaging professional
firms specializing in business acquisitions or reorganizations,
if management deems it in the best interests of the Company, such
firms may be retained. In some instances, the Company may
publish notices or advertisements seeking a potential business
opportunity in financial or trade publications.
Criteria
The Company will not restrict its search to any particular
business, industry or geographical location. The Company may
acquire a business opportunity or enter into a business in any
industry and in any stage of development. The Company may enter
into a business or opportunity involving a Astart up@ or new
company. The Company may acquire a business opportunity in
various stages of its operation.
In seeking a business venture, the decision of management of
the Company will not be controlled by an attempt to take
advantage of an anticipated or perceived appeal of a specific
industry, management group, or product or industry, but will be
based upon the business objective of seeking long-term capital
appreciation in the real value of the Company.
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In analyzing prospective business opportunities, management
will consider such matters as the available technical, financial
and managerial resources; working capital and other financial
requirements; the history of operations, if any; prospects for
the future; the nature of present and expected competition; the
quality and experience of management services which may be
available and the depth of the management; the potential for
further research, development or exploration; the potential for
growth and expansion; the potential for profit; the perceived
public recognition or acceptance of products, services, trade or
service marks, name identification; and other relevant factors.
Generally, the Company will analyze all available factors in
the circumstances and make a determination based upon a composite
of available facts, without reliance upon any single factor as
controlling.
Methods of Participation of Acquisition
Specific business opportunities will be reviewed and, on the
basis of that review, the legal structure or method of
participation deemed by management to be suitable will be
selected. Such structures and methods may include, but are not
limited to, leases, purchase and sale agreements, licenses, joint
ventures, other contractual arrangements, and may involve a
reorganization, merger or consolidation transaction. The Company
may act directly or indirectly through an interest in a
partnership, corporation, or other form of organization.
Procedures
As part of the Company's investigation of business
opportunities, officers and directors may meet personally with
management and key personnel of the firm sponsoring the business
opportunity, visit and inspect material facilities, obtain
independent analysis or verification of certain information
provided, check references of management and key personnel, and
conduct other reasonable measures.
The Company will generally request that it be provided with
written materials regarding the business opportunity containing
such items as a description of product, service and company
history; management resumes; financial information; available
projections with related assumptions upon which they are based;
an explanation of proprietary products and services; evidence of
existing patents, trademarks or service marks or rights thereto;
present and proposed forms of compensation to management; a
description of transactions between the prospective entity and
its affiliates; relevant analysis of risks and competitive
conditions; a financial plan of operation and estimated capital
requirements; and other information deemed relevant.
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Competition
The Company expects to encounter substantial competition in
its efforts to acquire a business opportunity. The primary
competition is from other companies organized and funded for
similar purposes, small venture capital partnerships and
corporations, small business investment companies and wealthy
individuals.
Employees
The Company does not currently have any employees but relies
upon the efforts of its officers and directors to conduct the
business of the Company.
Item 2. Management's Discussion And Analysis Of Financial
Statements
Plan of Operation
The Company has no cash and has experienced losses from
inception. As of April 30, 2000, the Company had outstanding
liabilities in the amount of $4,530. The Company has no material
commitments for capital expenditures for the next twelve months.
As of the date of this Form 10-SB, the Company has yet to
generate positive cash flow. Since inception, the Company has
primarily financed its operations through the sale of common
stock.
The Company believes that its current cash needs can be met
with the cash on hand or from loans from officers and directors
for at least the next twelve months. However, should the Company
obtain a business opportunity, it may be necessary to raise
additional capital. This may be accomplished by selling common
stock of the Company or debt financing.
Management of the Company intends to actively seek business
opportunities for the Company during the next twelve months.
Item 3. Description of Property
The Company does not currently own any property. The
Company utilizes office space on a rent-free basis in the office
of one of its officers located at5882 S. 900 E., Suite 202, Salt
Lake City, Utah 84117. This arrangement is expected to continue
until such time as the Company becomes involved in a business
opportunity which necessitates expansion or relocation.
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Item 4. Security Ownership of Certain Beneficial Owners and
Management; Changes in Control
The following table sets forth as of July 18, 2000, the name
and the number of shares of the Registrant's Common Stock, par
value $.0001 per share, held of record or beneficially by each
person who held of record, or was known by the Registrant to own
beneficially, more than 5% of the 5,242,924 issued and
outstanding shares of the Registrant's Common Stock, and the name
and shareholdings of each director and of all officers and
directors as a group.
Title of Name and Address of Amount and Nature of Percentage of Class
Class Beneficial Owner Beneficial Ownership
Common Curtis Olsen (1) -0- -0-
5882 South 900 East, Suite 202
Salt Lake City, UT 84121
Common Allison Olsen (1) -0- -0-
5882 South 900 East, Suite 202
Salt Lake City, UT 84121
Common Kip Eardley 320,000 6.1%
5882 S. 900 E.
Salt Lake City, UT 84117
Common Neal M. Brown 344,800 6.5%
34 Rice Road
Hingham, MA 02043
Common John Chymboryk 406,240 7.7%
5882 S. 900 E.
Salt Lake City, UT 84117
Common Milagro Holdings 4,000,000 76.3%
57 W. 200 S., Suite 310
Salt Lake City, UT 84101
Common Officers and Directors -0- -0-%
as a Group: 2 people
(1) Officer and/or director.
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There are no contracts or other arrangements that could
result in a change of control of the Company.
Item 5. Directors, Executive Officers, Promoters and Control
Persons.
The following table sets forth as of July 18, 2000, the
name, age, and position of each executive officer and director
and the term of office of each director of the Corporation.
Name Age Position Director or Officer Since
Curtis Olsen 30 President September 11, 1999
Allison Olsen 29 Secretary/Treasurer June 25, 2000
All officers hold their positions at the will of the Board
of Directors. All directors hold their positions for one year or
until their successors are elected and qualified.
Set forth below is certain biographical information
regarding each of the Company's executive officers and directors:
Curtis Olsen, Director and President. Mr. Olsen has been
active in the mortgage business for the past six years as a
wholesale and retail representative. Mr. Olsen currently owns
his own financial advisory company working in debt consolidation.
Mr. Olsen also works with various land developers in seeking
interim and long term financing for residential developments.
Allison Olsen, Director and Secretary/Treasurer. Ms. Olsen
is currently a homemaker and has been for the past three years.
Prior to that, Ms. Olsen was a retail training supervisor for
Smith's Food Store for eleven years.
To the knowledge of management, during the past five years,
no present or former directors, executive officer or person
nominated to become a director or an executive officer of the
Company:
(1) filed a petition under the federal bankruptcy laws or
any state insolvency law, nor had a receiver, fiscal agent or
similar officer appointed by a court for the business or property
of such person, or any partnership in which he was a general
partner at or within two years before the time of such filing, or
any corporation or business association of which he was an
executive officer at or within two years before the time of such
filing;
(2) was convicted in a criminal proceeding or named subject
of a pending criminal proceeding (excluding traffic violations or
other minor offenses);
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(3) was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining him
from or otherwise limiting, the following activities:
(i) acting as a futures commission merchant,
introducing broker, commodity trading advisor, commodity pool
operator, floor broker, leverage transaction merchant, associated
person of any of the foregoing, or as an investment advisor,
underwriter, broker or dealer in securities, or as an affiliate
person, director or employee of any investment company, or
engaging in or continuing any conduct or practice in connection
with such activity;
(ii) engaging in any type of business practice; or
(iii) engaging in any activity in connection with the
purchase or sale of any security or commodity or in connection
with any violation of federal or state securities laws or federal
commodities laws;
(4) was the subject of any order, judgment, or decree, not
subsequently reversed, suspended, or vacated, of any federal or
state authority barring, suspending, or otherwise limiting for
more than 60 days the right of such person to engage in any
activity described above under this Item, or to be associated
with persons engaged in any such activity.
(5) was found by a court of competent jurisdiction in a
civil action or by the Securities and Exchange Commission to have
violated any federal or state securities law, and the judgment in
such civil action or finding by the Securities and Exchange
Commission has not been subsequently reversed, suspended, or
vacated
(6) was found by a court of competent jurisdiction in a
civil action or by the Commodity Futures Trading Commission to
have violated any federal Commodities law, and the judgment in
such civil action or finding by the Commodity Futures Trading
Commission has not been subsequently reversed, suspended or
vacated.
Item 6. Executive Compensation.
No compensation has been paid to any officer or director of
the Company in the past three years. There are no compensatory
plans or arrangements, including payments to be received from the
Company, with respect to any officers or directors of the Company
which would in any way result in payments to any such person
because of his resignation, retirement, or other termination of
such person's employment with the Company, or any change in
control of the Company, or a change in the person's
responsibilities following a change in control of the Company.
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The Company has no arrangements for the remuneration of its
officers and directors, except that they will be entitled to
receive reimbursement for actual, demonstrable out-of-pocket
expenses, including travel expenses, if any, made on the
Company's behalf in the investigation of business opportunities.
No remuneration has been paid to the Company's officers or
directors prior to the filing of this Form 10-SB. There are no
agreements or understandings with respect to the amount or
remuneration those officers and directors are expected to receive
in the future. Management takes no salaries from the Company and
does not anticipate receiving any salaries in the foreseeable
future.
Compensation of Directors
None.
Employment Contracts and Termination of Employment and Change in
Control Arrangement
There are no employment contracts between the Company and
any of its officers or directors. Management takes no salaries
from the Company and does not anticipate receiving any salaries
in the foreseeable future.
There are no compensatory plans or arrangements, including
payments to be received from the Company, with respect to any
person named in Cash Compensation set out above which would in
any way result in payments to any such person's employment with
the company or its subsidiaries, or any change in control of the
Company, or a change in the person's responsibilities following a
change in control of the Company.
Item 7. Certain Relationships and Related Transactions.
Although there are no current related party transactions,
the Company's officers and directors and major shareholders have
made an oral undertaking to make loans to the Company in amounts
sufficient to enable the Company to satisfy its reporting
requirements and other obligations incumbent on it as a public
company, and to commence, on a limited basis, the process of
investigating possible merger and acquisition candidates. Any
such loans will be interest free and are intended to be repaid at
a future date, if or when the Company shall have sufficient
funds. The potential loans are intended to provide for the
payment of filing fees, professional fees, printing and copying
fees and other miscellaneous fees.
The Company utilizes office space provided by Curtis Olsen,
an officer and director of the Company, at no charge to the
Company.
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Item 8. Description of the Securities.
Common Stock
The Company is presently authorized to issue 75,000,000
shares of $.0001 par value common stock. All shares, when
issued, will be fully paid and nonassessable. All shares are
equal to each other with respect to liquidation and dividend
rights. Holders of voting shares are entitled to one vote for
each share they own at any Shareholders' meeting.
Holders of shares of common stock are entitled to receive
such dividends as may be declared by the Board of Directors out
of funds legally available therefor, and upon liquidation are
entitled to participate pro-rata in a distribution of assets
available for such distribution to Shareholders. There are no
conversion, preemptive or other subscription rights or privileges
with respect to any shares.
The common stock of the Company does not have cumulative
voting rights which means that the holders of more than 50% of
the voting shares voting for election of directors may elect all
of the directors if they choose to do so. In such event, the
holders of the remaining shares aggregating less than 50% will
not be able to elect any directors.
Preferred Stock
The Company is also authorized to issue 25,000,000 shares of
$.0001 par value preferred stock with the rights, preferences and
privileges of such preferred stock to be designated by the board
of directors of the Company. As of the date of this report, no
shares of preferred stock have been issued.
Warrants
The Company has 1,271 A Warrants and 1,271 B Warrants
outstanding. Each A warrant can be converted to one share of
common stock at $2.25 per share and each B warrant can be
converted to one shares of common stock at $4.00 per share. No
value was assigned to the warrants on the issue date. The
Company can redeem the warrants after a 30 days notice at $.02
each.
Transfer Agent
The Company has appointed Atlas Stock Transfer, 5899 South
State Street, Murray, Utah 84107, as the transfer agent and
registrar for the Company's securities.
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PART II
Item 1. Market Price of and Dividends on the Registrant's Common
Equity and Other Shareholder Matters.
The Company is currently trading on the NQB Pink Sheets
under the symbol WTPE. As of July 18, 2000, there were 41
shareholders holding 5,242,924 shares of common stock. Of the
issued and outstanding common stock, 188,124 are free trading,
the balance are restricted stock as that term is used in Rule
144.
YEAR CLOSING BID CLOSING ASK
HIGH LOW HIGH LOW
1998
1-20-98 thru
3-31-98 .03125 .01 None None
Second Quarter .03125 .03125 .125 .125
Third Quarter .03125 .03125 .125 .125
Fourth Quarter .03125 .03125 None None
1999
First Quarter .03125 .01 1.125 .0625
Second Quarter .02 .01 .25 .25
Third Quarter .02 .02 .25 .25
10-1-99 thru
12-20-99 .03125 .01 .625 .21875
12-21-99 thru
12-31-99 .25 .25 None None
(After a 1 for 50 Reverse Split)
2000
First Quarter .25 .25 10.25 10.25
Second Quarter .25 .03 10.25 4.25
The above quotations, as provided by the National Quotation
Bureau, LLC., represent prices between dealers and do not include
retail markup, markdown or commission. In addition, these
quotations do not represent actual transactions.
During the second quarter of 2000, the Company effected a
four to one forward split of its issued and outstanding common
stock.
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The Company has not paid, nor declared, any dividends since
its inception and does not intend to declare any such dividends
in the foreseeable future. The Company's ability to pay
dividends is subject to limitations imposed by Nevada law. Under
Nevada law, dividends maybe paid to the extent that the
corporation's assets exceed its liabilities and it is able to pay
its debts as they become due in the usual course of business.
Item 2. Legal Proceedings.
No legal proceedings are threatened or pending against the
Company or any of its officers or directors. Further none of the
Company's officers or directors or affiliates of the Company are
parties against the Company or have any material interests in
actions that are adverse to the Company's interests.
During September 1999, the Company sold its remaining assets
to a related party in exchange for the assumption of $175,695 of
its liabilities. As of the date of this report, $34,376 of the
liabilities have not been satisfied by the purchaser and
creditors may make claims against the Company if they are not
settled or satisfied in the future. The Company has received no
indication that claims may be made against them.
Item 3. Changes in and Disagreements with Accountants.
None.
Item 4. Recent Sales of Unregistered Securities.
On April 25,1997, the Company issued 124,260 shares of its
common stock for assets and services to the Company's founders.
The Company relied upon Section 4(2) of the Securities Act of
1933 to effect the transaction. The shares were issued in a
private transaction that did not involve any public solicitation
or sales.
On September 13, 1997, the Company issued 22,480 shares of
its common stock for net cash of $108,911. The Company relied
upon Regulation D, Rule 504 to effect the offering of its Common
Stock.
From September to December, 1997, the Company issued 2,890
shares of its common stock to individuals for services valued at
$16.00 per share for a total cash value of $46,249. The Company
relied upon Section 4(2) of the Securities Act of 1933 to effect
the transaction. The shares were issued in a private transaction
that did not involve any public solicitation or sales.
On December 29, 1997, the Company issued 901 shares of
common stock to individuals for cash of $35,151. The Company
relied upon Regulation D, Rule 504 to effect the offering of its
Common Stock.
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On March 5, 1998, the Company issued 200 shares of common
stock for cash of $10,000. The Company relied upon Section 4(2)
of the Securities Act of 1933 to effect the transaction. The
shares were issued in a private transaction that did not involve
any public solicitation or sales.
During October and November, 1999, the Company issued
160,000 shares of common stock for services valued at $.01 per
share for a total services valued at $1,584. The Company relied
upon Section 4(2) of the Securities Act of 1933 to effect the
transaction. The shares were issued in a private transaction
that did not involve any public solicitation or sales.
On December 31, 1999, the Company issued 1,000,000 shares of
common stock for payment of a debt in the amount of $44,160. The
Company relied upon Section 4(2) of the Securities Act of 1933 to
effect the transaction. The shares were issued in a private
transaction that did not involve any public solicitation or
sales.
Item 5. Indemnification of Directors and Officers.
There are no provisions in the Nevada corporate law or the
Articles of Incorporation of the Company requiring the
corporation to indemnify any of the Company's officers and
directors.
The Articles of Incorporation of the Company provide
indemnification as follows:
As the Board of Directors may from time to time provide in
the By-laws or by resolution, the corporation may indemnify its
officers, directors, agents and other persons to the full extent
permitted by the laws of the State of Nevada.
The registrant's Articles of Incorporation limit liability
of its Officers and Directors to the full extent permitted by the
Nevada Business Corporation Act.
(a) Section 78.751 of the Nevada Business Corporation Act
provides that each corporation shall have the following powers:
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1. A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, except an
action by or in the right of the corporation, by reason of
the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses, including
attorneys' fees, judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in
connection with the action, suitor proceeding if he acted in
good faith and in a manner which he reasonably believed to
be in or not opposed to the best interest of the
corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct
was unlawful. The
termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo
contenders or its equivalent, does not, of itself create a
presumption that the person did not act in good faith and in
a manner which he reasonably believed to be in or not
opposed to the best interests of the corporation, and that,
with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason
of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses, including
amounts paid in settlement and attorneys' fees actually and
reasonably incurred by him in connection with the defense or
settlement of the action or suit if he acted in good faith
and in a manner which he reasonably believed to be in or not
opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue or
matter as to which such a person has been adjudged by a
court of competent jurisdiction, after exhaustion of all
appeals therefrom, to be liable to the corporation or for
amounts paid in settlement to the corporation, unless and
only to the extent that the court in which the action or
suit was brought or other court of competent jurisdiction,
determines upon application that in view of all the
circumstances of the case, the person is fairly and
reasonably entitled to indemnity for such expenses as the
court deems proper.
3. To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding
referred to in subsections 1 and 2, or in defense of any
claim, issue or matter therein, he must be indemnified by
the corporation against expenses, including attorneys' fees,
actually and reasonably incurred by him in connection with
the defense.
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4. Any indemnification under subsections 1 and 2, unless
ordered by a court or advanced pursuant to subsection 5,
must be made by the corporation only as authorized in the
specific case upon a determination that indemnification of
the director, officer, employee or agent is proper in the
circumstances. The determination must be made: (a) By the
stockholders; (b) By the board of directors by majority vote
of a quorum consisting of directors who were not parties to
the act, suit or proceeding; (c) If a majority vote of a
quorum consisting of directors who were not parties to the
act, suit or proceeding so orders, by independent legal
counsel, in a written opinion; or (d) If a quorum consisting
of directors who were not parties to the act, suit or
proceeding cannot be obtained, by independent legal counsel
in a written opinion.
5. The certificate or articles of incorporation, the bylaws
or an agreement made by the corporation may provide that the
expenses of officers and directors incurred in defending a
civil or criminal action, suit or proceeding must be paid by
the corporation as they are incurred and in advance of the
final disposition of the action, suit or proceeding, upon
receipt of an undertaking by or on behalf of the director or
officer to repay the amount if it is ultimately determined
by a court of competent jurisdiction that he is not entitled
to be indemnified by the corporation. The provisions of
this subsection do not affect any rights to advancement of
expenses to which corporate personnel other than directors
or officers may be entitled under any contract or otherwise
by law.
6. The indemnification and advancement of expenses
authorized in or ordered by a court pursuant to this
section: (a) Does not exclude any other rights to which a
person seeking indemnification or advancement of expenses
may be entitled under the certificate or articles of
incorporation or any bylaw, agreement, vote of stockholders
or disinterested directors or otherwise, for either an
action in his official capacity or an action in another
capacity while holding his office, except that
indemnification, unless ordered by a court pursuant to
subsection 2 or for the advancement of expenses made
pursuant to subsection 5, may not be made to or on behalf of
any director or officer if a final adjudication establishes
that his acts or omissions involved intentional misconduct,
fraud or a knowing violation of the law and was material to
the cause of action. (b) Continues for a person who has
ceased to be a director, officer, employee or agent and
inures to the benefit of the heirs, executors and
administrators of such a person.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to officers and directors
of the Company pursuant to the provisions of the Company's
Certificate of Incorporation, the Company has been informed that
in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act of 1933 and is therefore unenforceable.
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WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
FINANCIAL STATEMENTS AND REPORT
OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
April 30, 2000 and December 31, 1999
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Board of Directors
Water Petroleum and Environmental Technologies Company
Salt Lake City, Utah
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have audited the accompanying balance sheets of Water
Petroleum and Environmental Technologies Company ( development
stage company) at April 30, 2000 and December 31, 1999 and the
statements of operations, stockholders' equity, and cash flows
for the four months ended April 30, 2000 and the years ended
December 31, 1999 and 1998 the period April 24, 1997 (date of
inception) to April 30, 2000. 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 audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the balance sheet is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the balance sheet. An audit also
includes assessing the accounting principles used and significant
estimates made by management as well as evaluating the overall
balance sheet presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of Water Petroleum and Environmental Technologies Company at
April 30, 2000 and the results of operations and cash flows
for the four months ended April 30, 2000 and the years ended
December 31, 1999 and 1998 and the period April 24, 1997 (date of
inception) to April 30, 2000, in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. The Company
does not have sufficient working capital to pay its liabilities
or for any of its future planned activity which raises
substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are
described in Note 7. These financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
May 18, 2000
Salt Lake City, Utah
17
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
BALANCE SHEETS
April 30, 2000 and December 31, 1999
Apr 30, Dec 31,
2000 1999
ASSETS
CURRENT ASSETS
Cash $ - $ -
Total Current Assets $ - $ -
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable 4,530 2,730
Total Current Liabilities 4,530 2,730
CONTINGENT LIABILITIES - Note 6 - -
STOCKHOLDERS' EQUITY
Preferred stock
25,000,000 shares authorized, at $0.0001
par value - none out - -
Common stock
75,000,000 shares authorized, at $0.0001
par value
1,310,731 shares issued and outstanding 131 131
Capital in excess of par value 321,512 321,512
Accumulated deficit during development
stage (326,173) (324,373)
Total Stockholders' Deficiency (4,530) (2,730)
$ - $ -
The accompanying notes are an integral part of these financial
statements.
18
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
STATEMENTS OF OPERATIONS
For the Four Months Ended April 30, 2000 and the Years
Ended December 31, 1999 and 1998 and the Period April 24, 1997
(Date of Inception ) to April 30, 2000
Apr 30, Dec 31, Dec 31, Apr 24, 1997 to
2000 1999 1998 Apr 30, 2000
REVENUES $ - $ - $ - $ -
EXPENSES 1,800 43,129 139,031 553,764
NET LOSS - before other income (1,800) (43,129) (139,031) (553,764)
GAIN ON SALE OF ASSETS - note 3 - 227,591 - 227,591
NET INCOME (LOSS) $ (1,800) $ 184,462 $(139,031) $ (326,173)
NET LOSS PER COMMON
SHARE
Basic $ - $ .59 $ (.92)
AVERAGE OUTSTANDING
SHARES
Basic 1,310,731 310,731 150,731
The accompanying notes are an integral part of these financial
statements.
19
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Period April 24, 1997 (Date of Inception ) to April 30, 2000
Capital in
Common Stock Excess of Accumulated
Shares Amount Par Value Deficit
Balance April 24, 1997
(date of inception) - $ - $ - $ -
Issuance of common stock for assets
and services at $0.50 -
April 25, 1997 124,260 13 61,832 -
Issuance of common stock for cash
at $4.84 - net of offering
costs - September 13, 1997 22,480 2 108,911 -
Issuance of common stock for
services at $16.00 -
Sept to Dec 1997 2,890 - 46,249 -
Issuance of common stock for cash
at $39.01 - December 29, 1997 901 - 35,151 -
Net operating loss for the period
April 24, 1997 to December 31, 1997 - - - (369,804)
Issuance of common stock for cash
at $50.00 - March 5, 1998 200 - 10,000 -
Net operating loss for the year ended
December 31, 1998 - - - (139,031)
Balance December 31, 1998 150,731 15 262,143 (508,835)
Issuance of common stock for
services at $0.01 -
October and November 1999 160,000 16 1,584 -
Contribution to capital in cash -
related parties - - 13,625 -
Issuance of common stock for
payment of debt at $.044 -
December 31, 1999 1,000,000 100 44,160 -
Net operating profit for the
year ended December 31, 1999 - - - 184,462
Balance December 31, 1999 1,310,731 131 321,512 (324,373)
Net operating loss for the four
months ended April 30, 2000 - - - (1,800)
Balance April 30, 2000 1,310,731 $ 131 $ 321,512 $ 326,173
The accompanying notes are an integral part of these financial statement
20
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
(Development Stage Company)
STATEMENT OF CASH FLOWS
For the Four Months Ended April 30, 2000 and the Years Ended
December 31, 1999 and 1998 and the Period April 24, 1997
( Date of Inception) to April 30, 2000
Apr 30, Dec 31, Dec 31, April 24, 1997
2000 1999 1998 to Apr 30, 2000
CASH FLOWS FROM
OPERATING ACTIVITIES
Net profit (loss) $ (1,800) $ 184,462 $ (139,031) $(326,173)
Adjustments to reconcile net
profit (loss) to net cash
provided by operating activities
Depreciation and amortization - 11,154 11,154 33,462
Bad debts - - - 10,100
Issuance of common stock for
expenses - 1,600 - 97,322
Changes in accounts payable 1,800 5,062 105,111 219,311
Gain on sale of assets - note 3 - (227,591) - (227,591)
Net Cash Used by Operations - (25,313) (22,766) (193,569)
CASH FLOWS FROM INVESTING
ACTIVITIES
- - - -
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from loans - - 22,980 25,880
Contributions to capital - cash
- related parties - 13,625 - 13,625
Proceeds from issuance of
common stock - - 10,000 154,064
Net Increase (Decrease) in Cash - (11,688) 10,214 -
Cash at Beginning of Period - 11,688 1,474 -
Cash at End of Period $ - $ - $ 11,688 -
NON CASH OPERATING ACTIVITIES
Issuance of 124,260 shares of common stock
for assets and services - 1997 $ 61,845
Issuance of 2,890 shares of common stock
for services - 1997 46,249
Issuance of 160,000 shares of common stock for services - 1999 1,600
Issuance of 1,000,000 shares of common stock
for payment of debt - 1999 44,260
The accompanying notes are an integral part of these financial
statements.
21
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
The Company was incorporated under the laws of the state of
Nevada on April 24, 1997 with 75,000,000 authorized common shares
at a par value of $.0001 and 25,000,000 authorized preferred
shares at a par value of $.0001. The Company was organized for
the purpose of developing a patent to be used in the field of
water petroleum separation.
On December 8, 1999 the shareholders of the Company approved a
reverse stock split to be effective December 20, 1999 of one
share for 50 shares outstanding. This report has been prepared
showing after stock split shares from inception.
The Company is in the development stage and became inactive
after 1998.
During June and December 1997 the company completed two
regulation D stock offerings of 23,381 after stock split shares
of its common capital stock for cash.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
The Company recognizes income and expenses based on the accrual
method of accounting.
Dividend Policy
The Company has not yet adopted a policy regarding payment of
dividends.
Income Taxes
On April 30, 2000, the Company had a cumulative net operating
loss carry forward of $326,173. The tax benefit from the loss
carry forward has been fully offset by a valuation reserve
because the use of the future tax benefit is doubtful since the
Company has no operations. The loss carryforward will expire
beginning in years 2013 through 2021.
Basic and Diluted Net Income (Loss) Per Share
Basic net income (loss) per share amounts are computed based on
the weighted average number of shares actually outstanding, after
the stock split. Diluted net income (loss) per share amounts are
computed using the weighted average number of common shares and
common equivalent shares outstanding as if shares had been issued
on the exercise of the preferred share rights unless the
exercise becomes antidilutive and then only the basic per share
amounts are shown in the report.
22
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
NOTES TO FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial
statements in accordance with generally accepted accounting
principles. Those estimates and assumptions affect the reported
amounts of the assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were
assumed in preparing these financial statements.
Financial instruments
The carrying amounts of financial instruments, including accounts
payable, at April 30, 2000 are considered by management to be
their estimated fair values. These values are not necessarily
indicative of the amounts that the Company could realize in a
current market exchange.
Comprehensive Income
The Company adopted Statement of Financial Accounting Standards
No. 130. The adoption of this standard had no impact on the total
stockholder's equity on December 31, 1999.
Recent Accounting Pronouncements
The Company does not expect that the adoption of other recent
accounting pronouncements will
have a material impact on its financial statements.
3. SALE OF ASSETS
During September 1999 the Company sold its remaining assets to a
related party in exchange for the assumption of $175,695 of its
liabilities. $34,376 of the liabilities had not been satisfied by
the purchaser at the report date and the creditors may make
claims against the Company if they are not settled or satisfied
in the future.
4. WARRANTS ISSUED
During December 1997 the Company issued 63,550 (pre split) shares
for cash and services. Each share included one A warrant and one
B warrant exercisable within 60 months after October 15, 1997.
Each A warrant can be converted to one share of common stock at
$2.25 per share. Each B warrant can be converted to one share of
common stock at $4.00 per share. No value was assigned to the
warrants on the issue date.
The Company can redeem the warrants after a 30 day notice at $.02
each.
23
<PAGE>
WATER PETROLEUM AND ENVIRONMENTAL TECHNOLOGIES COMPANY
( Development Stage Company )
NOTES TO FINANCIAL STATEMENTS (Continued)
5. RELATED PARTY TRANSACTIONS
Related parties have acquired 80% of the outstanding stock of the
Company.
6. CONTINGENT LIABILITIES
See note 3
7. GOING CONCERN
The Company does not have sufficient working capital to pay its
liabilities and for any future planned activity.
Continuation of the Company as a going concern is dependent upon
obtaining additional working capital and the management of the
Company has developed a strategy, which it believes will
accomplish this objective through additional equity funding and
long term debt which will enable the Company to continue
operations for the next year.
There is no assurance that the management can be successful in
this effort.
24
<PAGE>
PART III
Item 1. Index and Description of Exhibits.
Exhibit
Number Title of Document Location
1 Articles of Incorporation See Attached
2 Bylaws See Attached
3 A & B Warrant Specimen See Attached
4 Financial Data Schedule See Attached
25
<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, thereunto duly authorized.
WATER PETROLEUM AND ENVIRONMENTAL
TECHNOLOGIES COMPANY
Date: June 20, 2000 By: /s/ Curtis Olsen, President
Date: June 20, 2000 By: /s/ Allison Olsen, Secretary and Treasurer
In accordance with the Exchange Act, this report has been
signed below by the following persons on behalf of the registrant
and in the capacities and on the dates indicated.
Date: June 20, 2000 By: /s/ Curtis Olsen
Director
Date: June 20, 2000 By: /s/ Allison Olsen
Director
26
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