UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the quarterly period ended June 30, 2000
-------------
Bridge Technology, Inc.
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(Exact name of small business issuer as specified in its charter)
Nevada 59-3065437
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(State or other jurisdiction of incorporation (IRS Employer
or organization) Identification No.)
12601 Monarch Street, Garden Grove, CA 92841
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(Address of principal executive offices)
(714) 891-6508
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(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes [X] No []
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act
after the distribution of securities under a plan confirmed by a court.
Yes [X] No []
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date
10,853,186
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Transitional Small Business Disclosure Format (Check one): Yes [] No [X]
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<PAGE>
PART 1 FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Bridge Technology, Inc. and Subsidiaries
Consolidated Balance Sheets
DEC. 31 JUN. 30
1999 2000
(Audited) (Unaudited)
------------ ------------
<S> <C> <C>
Assets
Current assets:
Cash $ 2,900,029 $ 3,011,256
Accounts receivable less allowance
for doubtful accounts of $112,911
and $114,756 5,793,882 10,059,473
Subscription receivable 75,000 -
Advances to employees 1,200 -
Other receivables 39,082 90,268
Inventory, less provision of $168,101
and $168,101 3,157,433 8,899,046
Due from related party 28,107 40,473
Due from other shareholders of CMS - 525,735
Other current assets 110,284 242,158
------------ -------------
Total current assets 12,105,017 22,868,409
Property and equipment, net 801,881 888,564
Goodwill, net of amortization of $279,797 - 2,904,777
Purchased intangibles 200,000 390,000
Related party receivable 250,000 225,000
Deferred income tax 70,750 68,109
Other assets 105,908 150,644
------------ -------------
Total assets $ 13,533,556 $ 27,495,503
============ =============
Liabilities and Shareholder's Equity
Current liabilities:
Accounts payable $ 5,289,936 $ 10,929,246
Accured taxes payable 307,804 564,465
Accrued liabilities 862,506 456,099
Bank loans payable 97,905 2,029,400
Current portion of note payable 150,155 74,680
Loans from related parties - 2,800,000
Other current liabilities 43,405 85,868
------------- -------------
Total current liabilities 6,751,711 16,939,758
Notes payable, less current portion 727,643 776,778
------------ -------------
Total liabilities 7,479,354 17,716,536
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Minority interest 38,552 650,593
Shareholder's equity:
Common stock; par value $0.01 per share,
authorized 100,000,000 shares,
10,442,186 shares and 10,853,186 shares
outstanding at December 31, 1999 and
June 30, 2000 104,422 108,532
Additional paid-in capital 6,721,852 9,288,158
Treasury stock (2,000) (2,000)
Accumulated deficit (744,415) (207,131)
Accumulated other comprehensive income (64,209) (59,185)
------------- -------------
Total shareholder's equity 6,015,650 9,128,374
------------- -------------
Total liabilities and shareholder's
equity $ 13,533,556 $ 27,495,503
============= =============
See accompanying summary of accounting policies and notes to consolidated
financial statements.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Bridge Technology, Inc. and Subsidiaries
Consolidated Statements of Operations
Three Months Ended Six Months Ended
-------------------------- ---------------------------
June 30, June 30, June 30, June 30,
1999 2000 1999 2000
------------ ------------- ------------- -------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net sales $ 7,183,806 $ 25,503,867 $ 16,771,900 $ 47,254,830
Cost of sales 5,744,752 22,304,818 13,855,705 42,153,043
------------ ------------- ------------- -------------
Gross profit 1,439,054 3,199,049 2,916,195 5,101,787
Research and development 100,210 211,861 157,896 403,576
Selling, general and
administrative expense 1,083,921 1,898,116 2,173,217 3,557,574
----------- ------------- ------------- -------------
Income from operations 254,923 1,089,072 585,082 1,140,637
Other income (expense):
Interest income
(expense), net 8,327 (106,733) 13,588 (158,125)
Other income 49,605 46,630 52,415 114,442
----------- ------------- ------------- -------------
Income before income
taxes 312,855 1,028,969 651,085 1,096,954
Income taxes provision 122,797 270,210 244,473 341,482
----------- ------------- ------------- -------------
Net income 190,058 758,759 406,612 755,472
Minority interest - (157,391) - (218,188)
----------- ------------- ------------- -------------
Net income applicable to
common shares $ 190,058 $ 601,368 $ 406,612 $ 537,284
=========== ============= ============= =============
Basic weighted average
number of common
stock outstanding 9,556,417 10,635,637 9,265,087 10,548,087
=========== ============= ============== ============
Basic earnings per share $ 0.02 $ 0.06 $ 0.04 $ 0.05
=========== ============= ============== ============
Diluted weighted average
number of common
stock outstanding 11,416,648 11,047,451 11,125,317 10,959,901
=========== ============= ============== ============
Diluted income per share $ 0.02 $ 0.05 $ 0.04 $ 0.05
=========== ============= ============== ============
Comprehensive income
and its components
consist of the
following:
Net income $ 190,058 $ 601,368 $ 406,612 $ 537,284
Foreign currency
translation
adjustment,
net of tax (1,429) 8,566 16,621 5,024
----------- ------------ ------------ -----------
Comprehensive
income $ 188,629 $ 609,934 $ 423,233 $ 542,308
=========== ============ ============ ===========
See accompanying summary of accounting policies and notes to consolidated
financial statements.
</TABLE>
- PAGE 3 -
<PAGE>
<TABLE>
<CAPTION>
Bridge Technology, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
Increase (Decrease) in Cash and Cash Equivalents
Six Months Ended
-------------------------
June 30, June 30,
1999 2000
----------- -----------
(Unaudited) (Unaudited)
<S> <C> <C>
Cashflows from operating activities
Net income (loss) $ 406,612 $ 537,284
Adjustments to reconcile net income to
net cash provided by (used in)
operating activities:
Depreciation and amortization 89,542 377,831
Provision for doubtful accounts 14,813 1,845
Stock in exchange for services - 3,666
Increase (decrease) from changes in
operating assets and liabilities:
Trade receivables 3,378,417 37,110
Inventory (501,986) 5,260,911
Other receivables 103,624 (3,431)
Advances to employees 27,500 1,200
Prepaid and other assets 30,903 (113,998)
Related party receivable (200,000) 25,000
Other assets (7,785) (44,738)
Accounts payable (2,290,857) (7,618,372)
Accured liabilities (1,048,414) (739,410)
Income taxes payable 156,437 156,302
Other liabilities (23,969) 42,464
Payable to employee (41,161) -
Due from other shareholders of CMS - (1,673,510)
Due from related party (2,197) (12,366)
Minority interest - 218,188
------------ ------------
Net cash provided by (used in) operating
activities 91,479 (3,544,024)
------------ ------------
Cash flows from investing activities
Purchase of property, plant and equipment (336,131) (112,119)
Purchased intangibles (150,000) -
Acquisition of CMS, net of cash acquired - (5,293,164)
------------ ------------
Net cash used in investing activities (486,131) (5,405,283)
------------ ------------
Cash flows from financing activities
Proceeds form loans payable - 2,291,500
Repayments on loans payable (481,858) (386,346)
Proceeds from issuance of common stock 850,000 -
Proceeds form exercise of warrants - 36,750
Proceeds form related party loans - 2,900,000
Repayments of related party loans - (100,000)
Stock subscription colllected 25,000 4,316,645
Stock repurchase (2,000) -
------------ ------------
Net cash provided by financing activities 391,142 9,058,549
------------ ------------
Effect of exchange rate changes on cash 16,621 1,985
------------ ------------
Net increase in cash and cash equivalents 13,111 111,227
Cash and cash equivalents, beginning of year 2,115,727 2,900,029
------------ ------------
Cash and cash equivalents, end of year $ 2,128,838 $ 3,011,256
============ ============
Supplemental information:
Cash paid during the year for:
Interest $ 24,260 172,776
Income taxes 92,194 84,821
============ ============
</TABLE>
Supplemental disclosure of non-cash activities:
In October 1999, the Company issued 50,000 warrants to purchase common stock at
$5.00 per share to a public relations firm in exchange for public relations
services starting from November 1, 1999 to April 30, 2000. The contract has
since been extended to April 30, 2001. Accordingly, an expense $3,666 on a pro
rata basis was recognized and included as a general and administrative expense.
In May 2000, the Company acquired five patents, including design and tooling
from an unrelated entity for $190,000, in exchange for 40,000 shares of common
stock at market price of $4.75 per share.
In May 2000, the Company exercised an option to acquire the remaining 30%
interest in CMS Technology Limited (CMS) in exchange for 360,000 shares of the
Company's common stock at a market price of $6.50 per share. The acquisition
was effective May 15, 2000. The fair market value of 30% interest of CMS
amounted to $1,824,050. Consequently the Company recognized goodwill of
$515,950, which will be amortized over a five-year period on a straight line
basis.
See accompanying summary of accounting policies and notes to consolidated
financial statements.
- PAGE 4 -
<PAGE>
Bridge Technology, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
(Unaudited)
Organization and Business
Bridge Technology, Inc. ("The Company") was incorporated under the laws of the
State of Nevada on April 15, 1969. Starting from April 1997, the Company
registered to do business in the State of California and is primarily engaged
in development and distribution of various hardware, software, and peripheral
products used in computer systems and sales to value added resellers and system
integrators. The Company started to enter into wireless internet business in
1999.
The Company has the following subsidiaries:
Bridge R&D, Inc. 100% Established on June 1, 1997
Newcorp Technology Limited (in Japan) 100% Merged on November 1, 1997
PTI Enclosures, Inc. 100% Merged on December 14, 1998
Newcorp Technologies, Inc. (USA) 100% Established on March 23, 1999
Pacific Bridge Net 80% Established on August 16, 1999
Autec Power Systems, Inc. 100% Merged on December 1, 1999
CMS Technology Limited 90% Acquired on January 3, 2000 (60%)
Acquired on May 15, 2000 (30%)
Note 1. Basis of Presentation
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-QSB and
Article 10 of Regulation S-X. Accordingly, they do not include all the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring adjustments) considered necessary
for fair presentation have been included. Operating results for the three
month and six month periods ended June 30, 2000 are not necessarily indicative
of the results that may be expected for the year ending December 31, 2000.
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form 10-KSB for
the year ended December 31, 1999.
Note 2. Income Taxes
As of December 31, 1999, for federal income tax purposes, the Company had
approximately $180,000 in net operating loss carryforwards expiring through
2018. Additionally, one of the subsidiaries of the Company has net operating
loss carryforwards, not included above, which are separate return year losses
in the amount of approximately $77,000 and will begin to expire in 2008. The
annual utilization of the operating loss carryforward may be significantly
limited due to the adverse resolution, if any, with respect to the loss
carryover provisions of Internal Revenue Code Section 382 in connection with
certain stock issuances by the Company.
Note 3. Shareholders' Equity
In October 1999, the Company issued 50,000 warrants to purchase common stock at
$5.00 per share to a public relations firm in exchange for public relations
services starting from November 1, 1999 to April 30, 2000. The contract has
since been extended to April 30, 2001. Accordingly, an expense of $3,666 on a
pro rata basis was recognized and included as a general and administrative
expense.
- PAGE 5 -
<PAGE>
Note 3. Shareholders' Equity (Continued)
In January 2000, a key employee of the Company exercised 10,000 warrants with
an exercise price of $3.50 per share in exchange for 10,000 shares of common
stock. The Company accordingly received proceeds of $35,000 from the
employee.
In April 2000, an employee of the Company exercised 1,000 warrants with an
exercise price of $1.75 per share in exchange for 1,000 shares of common
stock. The Company accordingly received proceeds of $1,750 from the employee.
In May 2000, the Company acquired five patents, including design and tooling
from an unrelated entity for $190,000, in exchange for 40,000 shares of common
stock at market price of $4.75 per share.
In May 2000, the Company exercised an option to acquire the remaining 30%
interest in CMS Technology Limited (CMS) in exchange for 360,000 shares of the
Company's common stock at a market price of $6.50 per share.
Note 4. Acquisition of CMS Technology Limited
In December 1999, the Company entered into an acquisition agreement with CMS
Technology Limited (CMS), a related party company incorporated under the laws
of Hong Kong Special Administrative Region, to acquire 60% equity interest for
cash of $6 million subject to a valuation report that will be performed by a
third party appraisal firm. Funding of acquisition has been obtained from the
following sources: $2.9 million from the Company's related parties, and
$1.55 million from the Company's line of credit. The remaining $1.55 million
was financed from the Company's working capital.
The acquisition was effective January 3, 2000. The acquisition transaction was
accounted for under the purchase method. The fair market value of 60% equity
interest in CMS Technology Limited amounted to $3,331,416, consequently, the
Company recognized a goodwill of $2,668,584, which will be amortized over a
five year period on a straight line basis.
At the same time, a director and shareholder of the Company acquired 10% of
equity interest in CMS. In accordance with the acquisition agreement, the
Company has an option to acquire the remaining 30% of equity interest in CMS in
exchange for 360,000 shares of the Company's common stock.
In May 2000, the Company exercised the option to acquire the remaining 30%
interest in CMS Technology Limited (CMS) in exchange for 360,000 shares of the
Company's common stock at a market price of $6.50 per share. The acquisition
was effective May 15, 2000. The fair market value of 30% interest of CMS
amounted to $1,824,050. Consequently the Company recognized goodwill of
$515,950, which will be amortized over a five-year period on a straight line
basis.
The Company recognized an amortization charge of $146,328 for the three months
ended June 30, 2000 and $279,757 for the six months ended June 30, 2000.
- PAGE 6 -
<PAGE>
Note 4. Acquisition of CMS Technology Limited (Continued)
The condensed pro forma statements of operations for the six months ended June
30, 1999 and 2000 were presented as follows:
<TABLE>
<CAPTION>
CMS Bridge Pro Forma
June 30, June 30, June 30,
1999 1999 1999
------------ ------------ ------------
<S> <C> <C> <C>
Revenue $ 25,767,242 $ 17,136,094 $ 42,903,336
============ ============ ============
Net income $ 287,898 $ 324,637 $ 612,535
============ ============
Adjustment:
Amortization of goodwill 318,454
------------
Pro forma net income $ 294,081
============
CMS Bridge Pro Forma
June 30, June 30, June 30,
2000 2000 2000
------------ ------------ ------------
Revenue $ 27,413,090 $ 19,841,740 $ 47,254,830
============ ============ ============
Net income $ 876,224 $ 189,043 $ 1,065,267
============ ============
Adjustment:
Amortization of goodwill 318,454
------------
Pro forma net income $ 746,813
============
</TABLE>
Note 5. Commitments
In April 2000, the Company increased its revolving line of credit facility to
an aggregate amount of principal not to exceed $3,000,000.
- PAGE 7 -
<PAGE>
Bridge Technology, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
(Unaudited)
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Except for historical information contained herein, the matters set forth in
this report are forward-looking statements within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Act of 1995. These
forward-looking statements are subject to risks and uncertainties that may
cause actual results to differ materially. The Company disclaims any
obligations to update these forward-looking statements.
Results of Operations for the Three Months Ended June 30, 2000 as Compared to
the Three Months Ended June 30, 1999
------------------------------------------------------------------------------
Net sales of $25,503,867 for the three months ended June 30, 2000 increased by
$18,320,061 (255%) over net sales of $7,183,806 for the same period of 1999.
The increase was due primarily to the inclusion of CMS Technologies Limited
revenue for the period ended June 30, 2000.
Gross profit for the three months ended June 30, 2000 was $3,199,049, a 122%
increase when compared to $1,439,054 for the three months ended June 30, 1999,
reflecting higher volume of revenue attributed to the inclusion of
CMS Technology Limited for the period ended June 30, 2000. Gross profit as a
percentage of net sales declined from 20% for the three months ended June 30,
1999 to 12.5% for the three months ended June 30, 2000. The decrease is
principally due to lower margin of CMS Technology Limited.
Research and development expenses increased by $111,651 to $211,861 in the
three months ended June 30, 2000, compared to $100,210 for the three months
ended June 30, 1999. This represents a 111% increase and is due to Autec
investing extra resources to develop improved products.
Selling, general and administrative expenses increased by $814,195 to
$1,898,116 in the three months ended June 30, 2000 compared to $1,083,921 for
the three months ended June 30, 1999. Part of the increase can be attributed
to a goodwill amortization charge of $146,328 included in selling, general and
administrative expenses in the three months ended June 30, 2000 as a result of
the acquisition of CMS Technology Limited. As a percentage of revenue, these
expenses decreased from 15% in the three months ended June 30, 1999 to 7.4% in
the three months ended June 30, 2000. The decline is largely due to the
inclusion of CMS Technology Limited for the three months ended June 30, 2000
and lower selling, general and administrative expenses relative to revenue for
the three months ended June 30, 2000 compared to the same period in 1999.
Operating results increased from income of $254,923 in the three months ended
June 30, 1999 to income of $1,089,072 in the three months ended June 30, 2000.
The increase principally reflects the lower selling, general and
administrative expenses relative to revenue. Income from operations as a
percentage of revenue increased from 3.5% in the three months ended June 30,
1999 to 4.3% in the three months ended June 30, 2000.
Net interest declined $115,060 from income of $8,327 in the three months ended
June 30, 1999 compared to the expense of $106,733 in the three months ended
June 30, 2000. Other income decreased from $49,605 in the three months ended
June 30, 1999, compared to the $46,630 in the three months ended June 30,
2000.
Net income increased from $190,058 or $0.02 per share for the three months
ended June 30, 1999 compared to $601,368 or $0.06 per share on a higher number
of shares outstanding for the three months ended June 30, 2000.
- PAGE 8 -
<PAGE>
Results of Operations for the Six Months Ended June 30, 2000 as Compared to
the Six Months Ended June 30, 1999
-----------------------------------------------------------------------------
Net sales of $47,254,830 for the six months ended June 30, 2000 increased by
$30,482,930 (182%) over net sales of $16,771,900 for the same period of 1999.
The increase was due primarily to the inclusion of CMS Technologies Limited
revenue for the period ended June 30, 2000.
Gross profit for the six months ended June 30, 2000 was $5,101,787, a 75%
increase when compared to $2,916,195 for the six months ended June 30, 1999,
reflecting higher volume of revenue attributed to the inclusion of
CMS Technology Limited for the period ended June 30, 2000. Gross profit as a
percentage of net sales declined from 17% for the six months ended June 30,
1999 to 11% for the six months ended June 30, 2000. The decrease is
principally due to lower margin of CMS Technology Limited.
Research and development expenses increased by $245,680 to $403,576 in the six
months ended June 30, 2000, compared to $157,896 for the six months ended June
30, 1999. This represents a 156% increase and is due to Autec investing extra
resources to develop improved products.
Selling, general and administrative expenses increased by $1,384,357 to
$3,557,574 in the six months ended June 30, 2000 compared to $2,173,217 for
the six months ended June 30, 1999. Part of the increase can be attributed to
a goodwill amortization charge of $279,757 included in selling, general and
administrative expenses in the six months ended June 30, 2000 as a result of
the acquisition of CMS Technology Limited. As a percentage of revenue, these
expenses decreased from 13% in the six months ended June 30, 1999 to 7.5% in
the six months ended June 30, 2000. The decline is largely due to the
inclusion of CMS Technology Limited for the six months ended June 30, 2000 and
lower selling, general and administrative expenses relative to revenue for the
six months ended June 30, 2000 compared to the same period in 1999.
Operating results increased from income of $585,082 in the six months ended
June 30, 1999 to income of $1,140,637 in the six months ended June 30, 2000.
The increase principally reflects the lower selling, general and
administrative expenses relative to revenue. Income from operations as a
percentage of revenue decreased from 3.5% in the six months ended June 30,
1999 to 2.4% in the six months ended June 30, 2000.
Net interest declined $171,713 from income of $13,588 in the six months ended
June 30, 1999 compared to the expense of $158,125 in the six months ended June
30, 2000. Other income increased from $52,415 in the six months ended June
30, 1999, compared to the $114,442 in the six months ended June 30, 2000.
Net income increased from $406,612 or $0.04 per share for the six months ended
June 30, 1999 compared to an income of $537,284 or $0.05 per share on a higher
number of shares outstanding for the six months ended June 30, 2000.
- PAGE 9 -
<PAGE>
Liquidity and Capital Resources
Since current management acquired control of the Company in early 1997, the
Company has financed its operations with internally generated cash and with
the private placement of its securities totaling in excess of $2,600,000 to a
limited number of accredited investors with knowledge of the Company's
operations and plans to expand.
The Company is expected to augment its initial investment in DVD (digital
versatile disk), including an OPU (optical pickup unit) in order to commence
manufacturing in China and France. In addition the Company is in the process
of restructuring and financing its Pacific Bridge Net subsidiary. The Company
is also negotiating for a $20,000,000 private placement of its securities for
current and future plans. There is no assurance that financing can be
obtained and if available that the terms would be acceptable to the Company.
Based on these results the Company is actively seeking OEM customers and
manufacturing facilities in China and France.
The Company's capital requirements have been and will continue to be
significant and its cash and cash equivalents have been sufficient to cover
its cash flow from operations. At June 30, 2000, the Company had working
capital of $5,928,651 and cash of $3,011,256 compared to a working capital of
$5,544,024 and cash of $2,900,029 at December 31, 1999. Since restarting
operations, the Company has satisfied its working capital requirements with
cash generated through operations and the issuance of equity securities, and
obtaining working capital bank loans.
Net cash used in operating activities in the six months ended June 30, 2000
was $3,544,024 as compared to $91,479 provided by operating activities in the
six months ended June 30, 1999, the difference is mainly due to decrease in
accounts payable, and an increase in amounts owing from other shareholders of
CMS.
Net cash used in investing activities in the six months ended June 30, 1999
was $486,131 for the purchase of fixed assets and intangible assets in Japan,
as compared to $112,119 for the purchase of fixed assets in the six months
ended June 30, 2000. The acquisition of CMS Technology Limited accounted for
$5,293,164 cash used for the acquisition, net of cash acquired.
Net cash provided by financing activities in the six months ended June 30,
1999 was $391,142 as compared to $9,058,549 in the six months ended June 30,
2000. The change is attributable to the fact that in the first six months of
1999 there was only one private placement of $850,000 as opposed to an
increase in proceeds from loans and proceeds from related party in the first
six months of 2000.
The Company believes that it can fund the growth of its core business with
internally generated cash flow in addition to substantial cash receipts from
the private sale of its common stock.
Effects of Inflation
--------------------
The Company believes that inflation has not had a material effect on its net
sales and results of operations.
- PAGE 10 -
<PAGE>
Effects of Fluctuation in Foreign Exchange Rates
------------------------------------------------
The Company continues to buy products and services from foreign suppliers.
The Company contracts for such products and services denominated by U.S.
dollars, thus eliminating the possible effect of currency fluctuations. The
Company's wholly-owned subsidiary, Newcorp Technology (Japan), was subject to
such currency fluctuations and subsequently suffered losses due mainly to the
decline of Japanese yen from 106 Yen/dollar to present rate of 138.29
Yen/dollar. The Company's newly acquired subsidiary, CMS Technology Limited,
is subject to foreign currency fluctuation. However, the fluctuation is
immaterial.
- PAGE 11 -
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceeding
There are no legal proceedings either against the Company or
against third parties.
Item 2. Changes in Securities and Use of Proceeds
An employee of the Company in April 2000 exercised warrants to purchase
1,000 shares of the Company's common stock at $1.75 per share. The Company used
the proceed as an addition to its working capital.
The Company exchanged 360,000 shares of common stock in May 2000 for 30% of
CMS Technology Ltd. of Hong Kong increasing its percentage interest to 90%.
The Company exchanged 40,000 shares of common stock in May 2000 for 5
startrack design patents for palm top and hand held wireless trackball
applications from A-Link Co. Ltd., Taiwan, ROC.
Item 3. Defaults upon Senior Securities
There are no defaults upon senior securities.
Item 4. Submission of Matters to a Vote of Security Holders
There are no matters submitted to a vote of security holders.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
There are no exhibits and reports on Form 8-K.
SIGNATURES
Bridge Technology, Inc.
Registrant
8-15-2000 Winston Gu
Date ____________________ __________________________
Signature
Winston Gu, CEO
8-15-2000 John T. Gauthier
Date ____________________ __________________________
Signature
John T. Gauthier, CFO
- PAGE 12 -
