SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
[ ] Transitional Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1998
Commission File No. 000-23301
3PM HOLDING CORP.
-----------------
(Name of small business issuer in its charter)
Colorado 84-1284185
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, Colorado 80111
(303) 741-1118
--------------
(Address, including zip code and telephone number, including area
code, of registrant's executive offices)
Securities registered under Section 12(b) of the Exchange Act:
none
Securities registered under to Section 12(g) of the Exchange Act:
Common Stock
------------
(Title of class)
Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
Company was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
----- -----
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure
will be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-KSB or any amendment to this
Form 10-KSB. x
-----
Issuer's revenues for its most recent fiscal year: $ -0-
(Continued on Following Page)
<PAGE>
State the aggregate market value of the voting stock held by non-
affiliates, computed by reference to the price at which the stock
was sold, or the average bid and asked prices of such stock, as of
a specified date within the past 60 days: As of March 29, 1999: $0.
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: As of
March 29, 1999 there were 500,000 shares of the Company's common
stock issued and outstanding.
Documents Incorporated by Reference: None
This Form 10-KSB consists of Twenty-Seven Pages.
Exhibit Index is Located at Page Twenty-Six.
2
<PAGE>
TABLE OF CONTENTS
FORM 10-KSB ANNUAL REPORT
3PM HOLDING CORP.
PAGE
----
Facing Page
Index
PART I
Item 1. Description of Business..................... 4
Item 2. Description of Property..................... 6
Item 3. Legal Proceedings........................... 6
Item 4. Submission of Matters to a Vote of
Security Holders........................ 6
PART II
Item 5. Market for the Registrant's Common Equity
and Related Stockholder Matters......... 6
Item 6. Management's Discussion and Analysis of
Financial Condition and Results of
Operations.............................. 7
Item 7 Financial Statements........................ 8
Item 8. Changes in and Disagreements on Accounting
and Financial Disclosure................ 20
PART III
Item 9. Directors, Executive Officers, Promoters
and Control Persons, Compliance with
Section 16(a) of the Exchange Act....... 20
Item 10. Executive Compensation...................... 21
Item 11. Security Ownership of Certain Beneficial
Owners and Management................... 23
Item 12. Certain Relationships and Related
Transactions............................ 23
PART IV
Item 13. Exhibits and Reports of Form 8-K............ 24
SIGNATURES............................................. 25
3
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
3PM Holding Corp. (the "Company"), was incorporated on October
19, 1994, under the laws of the State of Colorado under the name
3PM, Inc. to engage in any lawful corporate undertaking. The
Company has been in the developmental stage since inception and
initially was engaged in the business of retail service and repair
of electronic equipment under franchises. The Company acquired the
rights to purchase five franchises, two of which were acquired and
operated in the Denver Metropolitan area. In April 1997, the
Company's Board of Directors elected to terminate the initial
business plan, sold its repair franchises and rights thereto, and
adopted a plan consistent with the plan outlined hereinbelow. The
Company will seek out, investigate and possibly acquire an interest
in business opportunities. As such, the Company can be defined as
a "shell" company, whose sole purpose at this time is to locate and
consummate a merger or acquisition with a private entity. The
Board of Directors of the Company has elected to commence
implementation of the Company's principal business purpose,
described below herein.
The proposed business activities of the Company classify it as
a "blank check" company. Many states have enacted statutes, rules
and regulations limiting the sale of securities of "blank check"
companies in their respective jurisdictions. Management does not
intend to undertake any efforts to cause a market to develop in the
Company's securities until such time as the Company has
successfully implemented its business plan described herein.
Relevant thereto, each shareholder of the Company has executed and
delivered a "lock-up" letter agreement, affirming that they shall
not sell their respective shares of the Company's common stock
until such time as the Company has successfully consummated a
merger or acquisition and the Company is no longer classified as a
"blank check" company. In order to provide further assurances that
no trading will occur in the Company's securities until a merger or
acquisition has been consummated, each shareholder has agreed to
place their respective stock certificate with the Company's legal
counsel, who will not release these respective certificates until
such time as legal counsel has confirmed that a merger or
acquisition has been successfully consummated. However, while
management believes that the procedures established to preclude any
sale of the Company's securities prior to closing of a merger or
acquisition will be sufficient, there can be no assurances that the
procedures established relevant herein will unequivocally limit any
shareholder's ability to sell their respective securities before
such closing.
Effective May 19, 1998, the Company entered into a letter of
intent with Northwood Sports, Inc., a Canadian corporation
("Northwood"), whereby the Company agreed in principle to acquire
4
<PAGE>
all of the issued and outstanding shares of Northwood in exchange
for issuance by the Company of previously unissued "restricted"
common stock. The relevant terms of the proposed transaction
require the Company to (i) undertake a "forward split" of its
common stock, whereby 2.4 shares of common stock shall be issued in
exchange for each share of common stock issued and outstanding, in
order to establish the number of issued and outstanding common
shares of the Company at Closing to be 1,200,000 shares; (ii) issue
to the Northwood shareholders an aggregate of 4,800,000
"restricted" common shares (post split), representing 80% of the
Company's then outstanding common stock, in exchange for all of the
issued and outstanding shares of Northwood.
The proposed transaction is subject to satisfaction of certain
conditions, including completion of due diligence activities, the
approval of the transaction by all of the Northwood shareholders
and the approval of the proposed transaction by the shareholders of
the Company. The aforesaid transaction has not closed as of the
date of this report due primarily to certain issues relating to
Northwood. As of the date of this report, management is continuing
discussions with management of Northwood concerning the proposed
transaction, but there can be no assurances that such transaction
will be successfully closed. In this regard, management is
continuing to review prospective merger or acquisition candidates,
but as of the date of this report, there is no agreement between
the Company and any third party providing for the Company to merge
or acquire any assets.
During the fiscal year ended December 31, 1997, the Company
filed a registration statement with the Securities and Exchange
Commission on Form 10-SB pursuant to the rules and regulations
included under the Securities Exchange Act of 1934, as amended,
wherein the Company caused to be registered its common stock. This
registration statement became effective on or about January 29,
1998. The purpose of the registration statement was management's
belief that the primary attraction of the Company as a merger
partner or acquisition vehicle will be its status as a public
company. Any business combination or transaction will likely
result in a significant issuance of shares and substantial dilution
to present stockholders of the Company.
Employees
During the fiscal year ended December 31, 1998, the Company
had no full time employees. The Company's President and Secretary
have agreed to allocate a portion of their time to the activities
of the Company, without compensation. These officers anticipate
that the business plan of the Company can be implemented by their
devoting approximately 20 hours per month to the business affairs
of the Company and, consequently, conflicts of interest may arise
with respect to the limited time commitment by such officers.
5
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY
Facilities. The Company operates from its offices at 5650
Greenwood Plaza Blvd., Suite 216, Englewood, Colorado 80111. This
space is provided to the Company on a rent free basis by the
President of the Company and it is anticipated that this
arrangement will remain until such time as the Company successfully
consummates a merger or acquisition. Management believes that this
space will meet the Company's needs for the foreseeable future.
Other Property. The Company has no properties and at this
time has no agreements to acquire any properties. The Company
intends to attempt to acquire assets or a business in exchange for
its securities which assets or business is determined to be
desirable for its objectives.
ITEM 3. LEGAL PROCEEDINGS
There are no material legal proceedings which are pending or
have been threatened against the Company of which management is
aware.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
SHAREHOLDER MATTERS
(a) Market Information. There is presently no trading market
for the common or preferred equity of the Company.
(b) Holders. There are ten (10) holders of the Company's
Common Stock.
As of the date of this report, all of the shares of the
Company's Common Stock are eligible for sale under Rule 144
promulgated under the Securities Act of 1933, as amended, subject
to certain limitations included in said Rule. In general, under
Rule 144, a person (or persons whose shares are aggregated), who
has satisfied a one year holding period, under certain
circumstances, may sell within any three month period a number of
shares which does not exceed the greater of one percent of the then
outstanding Common Stock or the average weekly trading volume
during the four calendar weeks prior to such sale. Rule 144 also
permits, under certain circumstances, the sale of shares without
any quantity limitation by a person who has satisfied a two year
holding period and who is not, and has not been for the preceding
three months, an affiliate of the Company.
6
<PAGE>
(c) Dividends.
(1) The Company has not paid any dividends on its Common
Stock. The Company does not foresee that the Company will have the
ability to pay a dividend on its Common Stock in the fiscal year
ended December 31, 1998, unless the Company successfully
consummates a merger or acquisition and the relevant candidate has
sufficient assets available to undertake issuance of such a
dividend and management elects to do so, of which there can be no
assurance.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with
the Company's audited financial statements and notes thereto
included herein. In connection with, and because it desires to
take advantage of, the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, the Company cautions
readers regarding certain forward looking statements in the
following discussion and elsewhere in this report and in any other
statement made by, or on the behalf of the Company, whether or not
in future filings with the Securities and Exchange Commission.
Forward looking statements are statements not based on historical
information and which relate to future operations, strategies,
financial results or other developments. Forward looking
statements are necessarily based upon estimates and assumptions
that are inherently subject to significant business, economic and
competitive uncertainties and contingencies, many of which are
beyond the Company's control and many of which, with respect to
future business decisions, are subject to change. These
uncertainties and contingencies can affect actual results and could
cause actual results to differ materially from those expressed in
any forward looking statements made by, or on behalf of, the
Company. The Company disclaims any obligation to update forward
looking statements.
(a) Plan of Operation.
------------------
The Company intends to seek to acquire assets or shares of an
entity actively engaged in business, in exchange for its
securities. As of the date of this report, management of the
Company has had preliminary discussions with potential merger or
acquisition candidates, but there is no definitive agreement
between the Company and any third party relevant thereto. In the
event the Company does enter into an agreement with such a third
party, the Board of Directors does intend to obtain certain
assurances of value of the target entity assets prior to
consummating such a transaction, with further assurances that an
audited financial statement would be provided within sixty days
after closing of such a transaction. Closing documents relative
thereto will include representations that the value of the assets
7
<PAGE>
conveyed to or otherwise so transferred will not materially differ
from the representations included in such closing documents, or the
transaction will be voidable.
The Company has no full time employees. The Company's
President and Secretary have agreed to allocate a portion of their
time to the activities of the Company, without compensation. These
officers anticipate that the business plan of the Company can be
implemented by their devoting approximately 20 hours per month to
the business affairs of the Company and, consequently, conflicts of
interest may arise with respect to the limited time commitment by
such officers.
Because the Company presently has nominal overhead or other
material financial obligations, management of the Company believes
that the Company's short term cash requirements can be satisfied by
management injecting whatever nominal amounts of cash into the
Company to cover these incidental expenses. There are no
assurances whatsoever that any additional cash will be made
available to the Company through any means.
Year 2000 Disclosure
Many existing computer programs use only two digits to
identify a year in the date field. These programs were designed
and developed without considering the impact of the upcoming change
in the century. If not corrected, many computer applications could
fail or create erroneous results by or at the Year 2000. As a
result, many companies will be required to undertake major projects
to address the Year 2000 issue. Because the Company has no assets,
including any personal property such as computers, it is not
anticipated that the Company will incur any negative impact as a
result of this potential problem. However, it is possible that
this issue may have an impact on the Company after the Company
successfully consummates a merger or acquisition. Management
intends to address this potential problem with any prospective
merger or acquisition candidate. There can be no assurances that
new management of the Company will be able to avoid a problem in
this regard after a merger or acquisition is so consummated.
ITEM 7. FINANCIAL STATEMENTS
8
<PAGE>
3PM HOLDING CORP.
FINANCIAL STATEMENTS
with
INDEPENDENT AUDITORS' REPORT
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
AND FOR THE PERIOD JANUARY 1, 1997 (INCEPTION)
THROUGH DECEMBER 31, 1998
9
<PAGE>
3PM HOLDING CORP.
TABLE OF CONTENTS
Page
----
Independent Auditors' Report 1
Balance Sheet 2
Statement of Operations 3
Statement of Changes in Stockholders' Equity 4
Statement of Cash Flows 5
Notes to Financial Statements 6-9
10
<PAGE>
Kish, Leake & Associates P.C.
Certified Public Accountants
J.D.Kish, C.P.A., M.B.A. 7901 E Belleview Ave - Suite 220
James D. Leake, C.P.A., M.T. Englewood, Colorado 80111
--------------------- Telephone (303) 779-5006
Arleen R. Brogan, C.P.A. Facsimile (303) 779-5724
Independent Auditors' Report
Board of Directors
3PM Holding Corp.
We have audited the accompanying balance sheet of 3PM Holding Corp., (a
Developmental Stage Company), as of December 31, 1998, and the related
statements of operations, changes in stockholders' equity, and cash flows for
the fiscal years ended December 31, 1998 and 1997 and the period January 1, 1997
(Inception) through December 31, 1998. 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 audit.
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 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 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 3PM Holding Corp., as of
December 31, 1998, and the results of its operations and its cash flows for
the fiscal years ended December 31, 1998 and 1997 and the period January 1, 1997
(Inception) through December 31, 1998 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 deficiency in working capital
as of December 31, 1998 and the Company's operating loss since inception raise
substantial doubt about its ability to continue as a going concern.
Management's plans concerning these matters are described in Note 7. The
financial statements do not include any adjustments that might result from the
outcome of these uncertainties.
s/Kish, Leake & Associates, P.C.
Kish, Leake & Associates, P.C.
Certified Public Accountants
Englewood, Colorado
March 18, 1999
-1-
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<PAGE>
<TABLE>
3PM Holding Corp.
Balance Sheet
- ------------------------------------------------------------------------------
<CAPTION>
Audited
December
31, 1998
--------
<S> <C>
ASSETS
Current Assets:
Cash $ 131
--------
TOTAL ASSETS 131
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Current Liabilities:
Accounts Payable Trade 4,365
Notes Payable Related Party 74,710
Accrued Interest Payable 15,315
--------
Total Current Liabilities 94,390
--------
TOTAL LIABILITIES 94,390
--------
SHAREHOLDERS' EQUITY
Preferred Stock, Par Value $.01;
Authorized 20,000,000 Shares 12/31/96 and 9/30/97;
Issued and Outstanding 0 Shares 12/31/96 and 9/30/97. 0
Common Stock
Authorized: 100,000 Shares 12/31/96 $.001 Par Value,
100,000,000 Shares 9/30/97 $.0001 Par Value.
Issued and Outstanding 50,000 Shares 12/31/96,
500,000 Shares 9/30/97. 50
Additional Paid In Capital 59,950
Retained Deficit (154,259)
--------
TOTAL SHAREHOLDERS' EQUITY (94,259)
--------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 131
========
<FN>
The Accompanying Notes Are An Integral Part Of These Financial
Statements.
</TABLE>
-2-
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<PAGE>
<TABLE>
3PM Holding Corp.
Statement Of Operations
- ------------------------------------------------------------------------------
<CAPTION>
January
1, 1997
Audited Audited (Inception)
Year Ended Year Ended through
December December December
31, 1998 31, 1997 31, 1998
-------- -------- --------
<S> <C> <C> <C>
REVENUE: $ 0 $ 0 $ 0
EXPENSES:
Administrative Expense 25 0 25
Bank Charges 111 37 148
Professional Fees 9,365 2,288 11,653
Total 9,501 2,325 11,826
-------- -------- --------
Net Income From Operations (9,501) (2,325) (11,826)
-------- -------- --------
Other Income ( Expense):
Interest Income 0 0 0
Interest Expense (4,487) (4,171) (8,658)
-------- -------- --------
Total Other Income (Expense) (4,487) (4,171) (8,658)
-------- -------- --------
Net Income (Loss) Before Taxes ($13,988) ($ 6,496) ($20,484)
======== ======== ========
Income Tax 0 0 0
-------- -------- --------
Net Income (Loss) ($13,988) ($ 6,496) ($20,484)
======== ======== ========
Basic Earnings (Loss) Per Common Share ($0.03) ($0.01) ($0.04)
======== ======== ========
Common Shares Outstanding 500,000 500,000 500,000
======== ======== ========
<FN>
The Accompanying Notes Are An Integral Part Of These Financial Statements.
</TABLE>
-3-
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<PAGE>
<TABLE>
3PM Holding Corp.
Statement Of Shareholders' Equity
- ------------------------------------------------------------------------------
<CAPTION>
Number Of Additional
Common Common Paid-In Retained
Shares ** Stock Capital Earnings Total
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Balance At December 31, 1994 500,000 $ 50 $ 59,950 ($ 14,212) $ 45,788
Net Loss December 31, 1995 (66,726) (66,726)
-------- -------- -------- -------- --------
Balance At December 31, 1995 500,000 50 59,950 (80,938) (20,938)
Net Loss December 31, 1996 (52,837) (52,837)
-------- -------- -------- -------- --------
Balance At December 31, 1996 500,000 50 59,950 (133,775) (73,775)
Net Loss December 31, 1997 (6,496) (6,496)
-------- -------- -------- -------- --------
Balance At December 31, 1997 500,000 50 59,950 (140,271) (80,271)
Net Loss December 31, 1998 (13,988) (13,988)
-------- -------- -------- -------- --------
Balance At December 31, 1998 500,000 $ 50 $ 59,950 ($154,259) ($94,259)
======== ======== ======== ======== ========
** Reflects 10 for 1 Stock Split.
<FN>
The Accompanying Notes Are An Integral Part Of These Financial Statements.
</TABLE>
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<PAGE>
<TABLE>
3PM Holding Corp.
Statement Of Cash Flows
- ------------------------------------------------------------------------------
<CAPTION>
January
1, 1997
Audited Audited (Inception)
Year Ended Year Ended through
December December December
31, 1998 31, 1997 31, 1998
-------- -------- --------
<S> <C> <C> <C>
Net Income (Loss) ($13,988) ($ 6,496) ($20,484)
-------- -------- --------
Items Not Affecting Cash Flow:
Depreciation & Amortization 0 0 0
-------- -------- --------
Total (13,988) (6,496) (20,484)
Increase (Decrease) In Accounts
Payable Trade 2,365 (2,391) (26)
Increase (Decrease) In Other
Accrued Expenses 4,483 4,171 8,654
-------- -------- --------
Net Cash Flows Provided From Operations (7,140) (4,716) (11,856)
-------- -------- --------
Cash Flows From Investing Activities:
Net Cash Flows Provided From
Investing Activities 0 0 0
-------- -------- --------
Cash Flows From Financing Activities:
Advances Received From Shareholder 5,200 2,000 7,200
Issuance of Stock 0 0 0
-------- -------- --------
Net Cash Flows Provided From
Financing Activities 5,200 2,000 7,200
-------- -------- --------
Net Increase In Cash (1,940) (2,716) (4,656)
Cash At Beginning Of Period 2,071 4,787 4,787
-------- -------- --------
Cash At End Of Period $ 131 $ 2,071 $ 131
======== ======== ========
Summary Of Non-Cash Investing
And Financing Activities: $ 0
========
<FN>
The Accompanying Notes Are An Integral Part Of These Financial Statements.
</TABLE>
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<PAGE>
3PM Holding Corp.
(A Development Stage Company)
Notes to Financial Statements
For The Years Ended December 31, 1998 and 1997
______________________________________________
Note 1 - Organization and Summary of Significant Accounting Policies
____________________________________________________________________
Organization
On October 19, 1994, 3PM Holding Corp. (The Company), was incorporated under
the laws of Colorado. The Company's primary purpose is any lawful business or
activity.
The Company purchased three VCR Doctor franchises whose primary purpose is the
operation of retail VCR repair stores. In April 1996, company management sold
the VCR Doctor franchise and the related assets for $25,000 in the form of a
note. The sale agreement was completed in May 1996 with a down payment and 48
monthly payments, however, the note was defaulted on and written off. Losses
applicable to the discontinued franchise operations segment were $7,117 in
1996. There were no assets or liabilities from the franchise operations
remaining after the sale and the Company ceased operations.
On January 1, 1997 the Company's management decided to search for a merger or
acquisition candidate and, therefore, has entered into the development stage.
Development Stage
The Company is currently in the developmental stage and has no significant
operations to date.
Property and Equipment
Furniture and equipment are stated at cost and are depreciated over their
estimated economic lives. Depreciation is computed using the straight-line
method.
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3PM Holding Corp.
(A Developmental Stage Company)
Notes to Financial Statements
For The Years Ended December 31, 1998 and 1997
______________________________________________
Statement of Cash Flows
For purposes of the statement of cash flows, the Company considers demand
deposits and highly liquid-debt instruments purchased with a maturity of three
months or less to be cash equivalents.
Cash paid for interest in 1998 and 1997 was -0-.
Cash paid for income taxes in 1998 and 1997 was -0-.
There were no non-cash transactions.
Net Income (Loss) Per Common Stock
The net income (loss) per common share is computed by dividing the net income
(loss) for the period by the weighted average number of shares outstanding at
December 31, 1998 and 1997.
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. Actual results could differ from those
estimates.
Note 2 - Capital Stock
______________________
Common Stock:
The Company initially authorized 100,000 shares of $.001 par value common
stock.
In September 1996 the Company amended and restated its Articles of
Incorporation and authorized 100,000,000 shares of $.0001 par value common
stock.
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3PM Holding Corp.
(A Developmental Stage Company)
Notes to Financial Statements
For The Years Ended December 31, 1998 and 1997
______________________________________________
The Company has declared no dividends through December 31, 1998 and 1997.
On September 15, 1997 the board and the shareholders of the Company adopted a
forward stock split of the then issued and outstanding common stock, whereby
10 shares of common stock were issued in exchange for each share then issued
and outstanding. The Company's authorized capital remained the same.
Preferred Stock:
In September 1996 the Company amended and restated its Articles of
Incorporation and authorized 20,000,000 shares $.01 par value non-voting
preferred stock, the rights and preferences of which to be determined by the
Board of Directors at the time of issuance.
Note 3 - Notes Payable
______________________
The Company maintains a $5,000 line of credit. The amount outstanding under
this line at December 31, 1998 was $-0- bearing a 10.75% annual interest rate.
Shareholders of the Company made unsecured demand loans to the Company bearing
simple interest at 6% annually.
Note 4 - Rent Leases
____________________
The Company leased two retail spaces for repairs of VCRs. Both operating
leases expired December 31, 1997, however the franchises were sold in April
1996 and the lease agreements were settled.
Note 5 - Related Party Events
_____________________________
Shareholders in the Company loaned money to the Company at various times
during the year.
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<PAGE>
3PM Holding Corp.
(A Developmental State Company)
Notes to Financial Statements
For The Years Ended December 31, 1998 and 1997
______________________________________________
Note 6 - Income Taxes
_____________________
In 1995 the Company elected to have its income taxed under section 1372 of
the Internal Revenue code which provides that, in lieu of corporation income
taxes, the shareholders are taxed on their proportionate share of the
Company's taxable income. Therefore, no provision or liability for federal
or state income taxes are included in the financial statements for the year
ended December 31, 1997. On January 1, 1998 this election was revoked and
the Corporation is now subject to Federal and State income taxation.
Income taxes are provided for the tax effects of transactions reported
on the financial statements and consist of taxes currently due plus
deferred taxes related primarily to differences between the recorded book
basis and tax basis of assets and liabilities for financial and income tax
reporting. The deferred tax assets and liabilities represent the future tax
return consequences of those differences, which will either be taxable or
deductible when the assets and liabilities are recovered or settled. Deferred
taxes are also recognized for operating losses that are available to offset
future income and tax credits that are available to offset federal income
taxes.
Due to the Company's net operating loss in the year ended December 31, 1998 of
$13,988 there are no income taxes currently due. As of December 31, 1998 the
Company has a deferred tax asset of $2,798 primarily from its net operating
loss carry forward which has been fully reserved through a valuation
allowance.
The change in the valuation allowance at December 31, 1998 was $2,798.
At December 31, 1998, the Company had a net operating loss carryforward
available for financial statement and Federal income tax purposes of
approximately $13,988 which, if not used, will expire in varying amounts
during the year 2013.
Note 7 - Basis of Presentation
______________________________
In the course of its development activities, the Company has sustained
continuing losses and expects such losses to continue in the foreseeable
future. The Company's ability to continue as a going concern is dependent
upon finding a successful merger or acquisition candidate.
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<PAGE>
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
None
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.
Directors are elected for one-year terms or until the next
annual meeting of shareholders and until their successors are duly
elected and qualified. Officers continue in office at the pleasure
of the Board of Directors.
The Directors and Officers of the Company as of the date of
this report are as follows:
Name Age Position
- ------------------ --- ---------------------
Gregory J. Simonds 48 President, Director
Gregory W. Skufca 41 Secretary/Treasurer &
Director
All Directors of the Company will hold office until the next
annual meeting of the shareholders and until successors have been
elected and qualified. Officers of the Company are elected by the
Board of Directors and hold office until their death or until they
resign or are removed from office.
There are no family relationships among the officers and
directors. There is no arrangement or understanding between the
Company (or any of its directors or officers) and any other person
pursuant to which such person was or is to be selected as a
director or officer.
(b) Resumes:
Gregory J. Simonds, is President and a director of the
Company, positions he has held since the Company's inception. In
addition to his positions with the Company, since June 1991, Mr.
Simonds has been self-employed, acting as a consultant to various
different companies, both public and private, as well as managing
his own investment portfolio. Mr. Simonds is also President and a
director of Buckeye Oil and Gas, Inc., a Colorado corporation,
which intends to file a Form 10-SB with the Securities and Exchange
Commission and, thereafter, adopt a business plan similar to that
of the Company to seek and consummate a merger or acquisition with
a private entity. In March 1990, Mr. Simonds, together with Mr.
Skufca, formed GS2 Partnership, a Colorado general partnership, for
20
<PAGE>
the purposes of providing funding to start-up and development stage
companies. Mr. Simonds received a Bachelor of Science degree from
New England College, Henniker, New Hampshire in 1973. Mr. Simonds
devotes only such time as necessary to the business of the Company,
which time is not expected to exceed 20 hours per month.
Gregory W. Skufca, is Secretary/Treasurer and a director of
the Company, positions he has held since the Company's inception.
In addition to his positions with the Company, since January 1989,
Mr. Skufca is also the President of Financial Communications,
Englewood, Colorado, a sole proprietorship engaged in assisting
public and private investors, assisting in the obtaining and
structuring of venture capital financing and public relations.
Prior, from May 1987 through January 1989, Mr. Skufca served as a
loan officer and consultant with Skufca-Meyer Financial Corp.,
Lakewood, Colorado, a small privately held lender specializing in
residential mortgages and corporate financing. In March 1990, Mr.
Skufca, together with Mr. Simonds, formed GS2 Partnership, a
Colorado general partnership, for the purposes of providing funding
to start-up and development stage companies. Further, Mr. Skufca
is President and a director of Zaba International, Inc., f/k/a HA
Spinnaker, Inc., a Colorado corporation, whose principal business
is the same as that of the Company. Mr. Skufca obtained a
Bachelor's degree from the University of Colorado at Boulder in
1980. He devotes only such time as necessary to the business of
the Company, which is not expected to exceed 20 hours per month.
Section 16(a) of the Securities Exchange Act of 1934 requires
the Company's officers, directors and person who own more than 10%
of the Company's Common Stock to file reports of ownership and
changes in ownership with the Securities and Exchange Commission.
All of the aforesaid persons are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they
file.
Because there were no changes in the security holdings of any
officer, director or principal shareholder of the Company, no
reports were required to be filed.
ITEM 10. EXECUTIVE COMPENSATION.
Remuneration
The following table reflects all forms of compensation for
services to the Company for the years ended December 31, 1998 and
1997 of the chief executive officer of the Company.
21
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
____________________________
Annual Compensation Awards Payouts
_____________________ ____________________ _______
Securities
Other Under- All
Name Annual Restricted lying Other
and Compen- Stock Options/ LTIP Compen-
Principal Salary Bonus sation Award(s) SARs Payouts sation
Position Year ($) ($) ($) ($) (#) ($) ($)
__________ ____ ______ _____ ______ ________ _______ _______ ______
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Gregory J. (1)(2)
Simonds, 1998 $ 0 $ 0 $ 0 $ 0 0 $ 0 $ 0
President 1997 0 0 0 0 0 0 0
& Director
_________________________
<F1>
(1) Mr. Simonds did not receive any salary during the fiscal year ended
December 31, 1998 from the Company.
<F2>
(2) It is not anticipated that any executive officer of the Company
will receive compensation exceeding $100,000 during 1999, except in
the event the Company successfully consummates a business
combination.
</TABLE>
The Company maintains a policy whereby the directors of the
Company may be compensated for out of pocket expenses incurred by
each of them in the performance of their relevant duties. The
Company did not reimburse any director for such expenses during the
fiscal year ended December 31, 1998.
In addition to the cash compensation set forth above, the
Company reimburses each executive officer for expenses incurred on
behalf of the Company on an out-of-pocket basis. The Company
cannot determine, without undue expense, the exact amount of such
expense reimbursement. However, the Company believes that such
reimbursements did not exceed, in the aggregate, $1,000 during
fiscal year 1998.
There are no bonus or incentive plans in effect, nor are there
any understandings in place concerning additional compensation to
the Company's officers.
22
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
(a) and (b) Security Ownership of Certain Beneficial Owners
and Management.
The table below lists the beneficial ownership of the
Company's voting securities by each person known by the Company to
be the beneficial owner of more than 5% of such securities, as well
as by all directors and officers of the issuer. Unless otherwise
indicated, the shareholders listed possess sole voting and
investment power with respect to the shares shown.
Name and Amount and
Address of Nature of
Title Beneficial Beneficial Percent of
of Class Owner Owner Class
________ _________________________ __________ __________
Common Greg Simonds 160,000 32%
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, CO 80111
Common Greg Skufca 160,000 32%
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, CO 80111
Common All Officers and 320,000 64%
Directors as a
Group (2 persons)
__________________
The balance of the Company's outstanding Common Shares are
held by 8 persons.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In December 1995, GS2 Partnership, a Colorado general
partnership in which Messrs. Simonds and Skufca are the general
partners, loaned the Company the principal amounts of $69,510. GS2
Partnership was formed in 1990 to provide both start-up and
development stage companies with capital to implement their
business plans. The loan is unsecured, accrues interest at the
rate of 6% per annum and is due upon demand. This loan related to
the business activities of the Company described in Part I, Item 1,
prior to the adoption of the Company's present business plan
described herein above.
23
<PAGE>
However, it is the intention of Messrs. Simonds and Skufca to
forgive this indebtedness if necessary in order to effectuate a
merger or acquisition which the Company's Board of Directors
believes to be in the best interests of the Company and its
shareholders.
There have been no other related party transactions, or any
other transactions or relationships required to be disclosed
pursuant to Item 404 of Regulation S-B.
PART IV
Item 13. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
--------
3.1* Certificate and Articles of Incorporation
3.2* Bylaws
EX-27 Financial Data Schedule
* Filed with the Securities and Exchange Commission in the Exhibits
to Form 10-SB, filed on October 13, 1998 and are incorporated by
reference herein.
(b) Reports on Form 8-K
-------------------
The Company did not file any reports on Form 8-K during the
last quarter of the fiscal year ended December 31, 1998.
24
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on
March 29, 1999.
3PM HOLDING CORP.
(Registrant)
By: s/Gregory J. Simonds
-------------------------------
Gregory J. Simonds, President
By: s/Gregory W. Skufca
-------------------------------
Gregory W. Skufca, 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 indicated on March 29, 1999.
s/Gregory J. Simonds
- ------------------------------
Gregory J. Simonds, Director
s/Gregory W. Skufca
- ------------------------------
Gregory W. Skufca, Director
25
<PAGE>
3PM HOLDING CORP.
Exhibit Index to Annual Report on Form 10-KSB
For the Fiscal Year Ended December 31, 1998
EXHIBITS Page No.
EX-27 Financial Data Schedule . . . . . . . . . . . 27
26
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
AUDITED FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 131
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 131
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 131
<CURRENT-LIABILITIES> 94,390
<BONDS> 0
0
0
<COMMON> 50
<OTHER-SE> (94,309)
<TOTAL-LIABILITY-AND-EQUITY> 131
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 9,501
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,487
<INCOME-PRETAX> (13,988)
<INCOME-TAX> 0
<INCOME-CONTINUING> (13,988)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13,988)
<EPS-PRIMARY> (.03)
<EPS-DILUTED> 0
</TABLE>
