Form 10-KSB
U.S. Securities and Exchange Commission
Washington, D.C. 20549
(Mark One)
[X] Annual report under section 13 or 15(d) of the Securities Exchange Act of
1934 For the fiscal year ended December 31, 1998.
[ ] Transition report pursuant section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from ...................to..................
Commission file number: 0-23687
I Tech Holdings Group, Inc.
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(Exact name of small business issuer as specified in its charter)
Colorado 84-1379282
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1620 York Street, Denver, Colorado 80206
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number, (303) 436-1847
NONE
(Former name, former address and former fiscal year,
if changed since last report)
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:
Check if there is no 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]
State issuer's revenues for its most recent fiscal year: $500.00
State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.) $65,000.
Note: If determining whether a person is an affiliate will involve an
unreasonable effort and expense, the issuer may calculate the aggregate market
value of the common equity held by non-affiliates on the basis of reasonable
assumptions, if the assumptions are stated.
<PAGE>
(Issuers involved in bankruptcy proceeding during the past five years)
Check whether the issuer has 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 [ ] No [ ] NOT APPLICABLE
(Applicable only to corporate registrants)
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 2,080,000.
Documents incorporated by reference
If the following documents are incorporated by reference, briefly describe them
and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into
which the document is incorporated: (1) any annual report to security holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant to
Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"). The listed
documents should be clearly described for identification purposes (e.g., annual
report to security holders for fiscal year ended December 24, 1990).
Transitional Small Business Disclosure Format (check one):Yes.[X]; No...
In accordance with paragraph H of the General Instructions the registrant
has elected to provide the information set forth under "Information Required in
Annual Report of Transitional Small Business Issuers."
PART I
Alternative 1.
The Company has elected to furnish the information required by Questions 1,
3, 4, 11, 14- 20, 28-43, 45, and 47-50 of Model A of Form 1-A, as follows:
THE COMPANY
1. Exact corporate name: I-Tech Holdings Group, Inc.
State and date of incorporation: Colorado - December 6, 1994.
Street address of principal office: 1620 York Street, Denver, Colorado 80206
Company Telephone Number: 303-436-1847 Fiscal Year: December 31
Person(s) to contact at Company: Clark Burch
Telephone Number (if different from above:) N/A
BUSINESS AND PROPERTIES/
3. With respect to the business of the Company and its properties:
(a) Describe in detail what business the Company does and proposes to do,
including what products or goods are or will be produced or services that are or
will be rendered.
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With the emergence of the popularity of the Internet, many companies are
now placing information about their business of Internet sites. Developing and
establishing an Internet location and the techniques necessary to design and
complete the electronic signals and accompanying graphics is a sophisticated
process and needs the skills of a person experienced in computers, electronics,
graphics, and motion video. As a result, those persons who have devoted their
skills to this new profession, are termed "webmasters."
The principals of the Company each have had more than 10 years experience
in computer programing and in film and video production which gives the Company
the foundation of the Company's enterprise. The Company is engaged in the
business of producing, on a contract basis, customized Internet websites and
pages for its clients. In furtherance of the business plan the Company has
established a web site as its initial marketing thrust. The Company's internet
web site may be found on "www. bwn.net/i-tech" The Company also attracts
prospective clients through word of mouth, and using their respective business
contacts in the Denver, Colorado area. The Company's e-mail address is:
"[email protected]"
The establishment of a web site on the Internet is a two-step sequence. The
first step is to design and produce the pages necessary to appear on the
Internet. This involves a combination of text and graphics, as well as "links"
to each successive page appearing after the initial or cover page. The second
step is to insert the pages of the product to actually appear on internet, most
generally on the world-wide web, commonly know as "www." In order for the pages
to appear on the web, enabling viewers to see them, the company must establish a
stand-alone computer containing the web pages, or, in the alternative, engage a
"host" which will establish the pages for the customer on a contract basis. The
Company does not act as a "host" for the web pages. There are literally hundreds
of web hosts operating around the world. A list of such hosts are readily
available on the world-wide web.
In general, at this time, most of the companies in the Denver metropolitan
area and in the state of Colorado, offering web site design are small and
comprised of one or two individuals. There are many sole practitioners in the
business of web site design. This is not to say that these companies and
individuals are not extremely competent and offer a good deal of competition for
the Company. It is the goal of the Company to become one of the best, but not
necessarily the largest, web designers in Colorado.
The Company initially raised only a small amount of operating capital. The
Company registered its common shares under the provisions of the Securities
Exchange Act of 1934 to provide a central source where information on the
activities of the Company may be obtained by the general public. Except for the
shares owned by affiliates of the Company, the common shares of the Company are
freely tradeable having been issued under the exemption to registration provided
by Regulation D, Rule 504 of the Securities Act of 1933, as amended. The common
shares of the Company are not currently trading on any exchange or trading
medium. The Company has no plans at the date of this report to trade the common
shares of the Company as soon as practical and as soon as a legitimate market
develops.
<PAGE>
The Company is currently designing websites for its clients utilizing the
graphics arts programs of MS Publisher, Word Perfect, and MS Word. The websites
design and execution also uses clipart programs of ClickArt, The Instant Image
Resource.
The Company may attempt to raise additional working capital, when required,
in one or more of various means including but not necessarily limited to debt
instruments, convertible debentures, equities and joint venture enterprises.
However, there is no assurance whatsoever that such working capital will be
needed or available to the Company in any of the above various forms, and if
available that the provisions of the capital will be attractive to the Company.
(b) Describe how these products or services are to be produced or rendered
and how and when the Company intends to carry out its activities. If the Company
plans to offer a new product(s), state the present stage of development,
including whether or not a working prototype(s) is in existence. Indicate if
completion of development of the product would require a material amount of the
resources of the Company, and the estimated amount. If the Company is or is
expected to be dependent upon one or a limited number of suppliers for essential
raw materials, energy or other items, describe. Describe any major existing
supply contracts.
The Company produces its website products on computers. The Company owns no
computer equipment and will necessarily depend upon utilization of equipment
owned by the principals of the Company who have agreed to allow the use of such
computers at a modest rental fee of $50.00 per month for two state-of-the-art
computers capable of producing programing for Internet websites, such fee being
predicated only if revenues of the Company permit. At present, the Company uses
one (1) P-2,233, MMX, 64RAM, 512 Cache, Zipdrive, 4.3gig hddrive, CDRom; and one
(1) O- 120,32RAM, 256 Cache, 3.5 F.Drive, 1.3 hddrive, CDRom.
(c) Describe the industry in which the Company is selling or expects to
sell its products or services and, where applicable, any recognized trends
within that industry. Describe that part of the industry and the geographic area
in which the business competes or will compete.
Indicate whether competition is or is expected to be by price, service, or
other basis. Indicate (by attached table if appropriate) the current or
anticipated prices or price ranges for the Company's products or services, or
the formula for determining prices, and how these prices compare with those of
competitors' products or services, including a description of any variations in
product or service features. Name the principal competitors that the Company has
or expects to have in its area of competition. Indicate the relative size and
financial and market strengths of the Company's competitors in the area of
competition in which the Company is or will be operating. State why the Company
believes it can effectively compete with these and other companies in its area
of competition.
Creating websites for clients is a highly personalized business. Most any
business can use a website for various reasons: education, sales, marketing, and
simply informational purposes. The company has not designated any specific
industry or business segment as its sales thrust, believing that a wider range
of prospects would generate the largest amount of business. The Company has not
projected any definite revenues for the Company based upon its business
<PAGE>
activities of designing and establishing Internet sites for clients. The Company
charges approximately $1,000 plus $200 per page as the initial charge for the
design and preparation of the pages for a web site. In addition to these
charges, specific and specialized art work and graphics will carry an additional
charge the amount of which will be determined by the costs of artists supplying
such graphics on a contractual basis. The Company believes it can complete in
the website designing business because of the intrinsic value of the design
abilities of its officers and directors. The Company's own website is a
practical example of the Company's work product.
(d) Describe specifically the marketing strategies the Company is employing
or will employ in penetrating its market or in developing a new market. Set
forth in response to Question 4 below the timing and size of the results of this
effort which will be necessary in order for the Company to be profitable.
Indicate how and by whom its products or services are or will be marketed (such
as by advertising, personal contact by sales representatives, etc.), how its
marketing structure operates or will operate and the basis of its marketing
approach, including any market studies. Name any customers that account for, or
based upon existing orders will account for a major portion (20% or more) of the
Company's sales. Describe any major existing sales contracts.
The Company is currently relying solely on the marketing efforts of its
officers and directors and the presence of its website on the internet.
(e) State the backlog of written firm orders for products and/or services
as of a recent date (within the last 90 days) and compare it with the backlog of
a year ago from that date:
As of: __012__/ __01_/__98__ $____-0-_______
(a recent date)
As of: __012__/___01_/__97__ $____-0-_______
(one year earlier)
Explain the reason for significant variations between the two figures, if
any. Indicate what types and amounts of orders are included in the backlog
figures. State the size of typical orders. If the Company's sales are
seasonal or cyclical, explain.
The Company has not yet set its major marketing effort in place, that of
advertising and developing a marketing plan. The Company believes its main
source of clients might well be in the areas of specialized websites utilizing
motion videos which the current officers and directors are skilled in doing. Mr.
Clark Burch, the Secretary of the Company is an experienced motion picture and
video writer-producer-director and his talents as such might be unusually suited
to provide an impact in the production of websites which normally would not
occur/
(f) State the number of the Company's recent employees and the number of
employees it anticipates it will have within the next 12 months. Also, indicate
the number of type of employee (i.e., clerical, operations, administrative,
etc.) The Company will use, whether or not any of them are subject to collective
bargaining agreements, and the expiration date(s) of any collective bargaining
agreement(s). If the Company's employees are on strike, or have been in the past
<PAGE>
three years, or are threatening to strike, describe the dispute. Indicate any
supplemental benefits or incentive arrangements the Company has or will have
with its employees.
The only employees of the Company at this time are its President and
Secretary. The Company has made no determination about additional employees. If
the revenues of the Company are obtained through its sales, the Company
estimates that it may need to hire up to three staff employees in a clerical
jobs. Additionally, the Company may employ contract sales persons or
organizations on a commission basis to assist in its marketing.
(g) Describe generally the principal properties (such as real estate, plant
and equipment, patents, etc.) That the Company owns, indicating also what
properties it leases and a summary of the terms under those leases, including
the amount of payments, expiration dates and the terms of any renewal options.
Indicate what properties the Company intends to acquire in the immediate future,
the cost of such acquisitions and the sources of financing it expects to use in
obtaining these properties, whether by purchase, lease or otherwise.
The Company owns no properties and does not contemplate any such ownership
in the near future.
(h) Indicate the extent to which the Company's operations depend or are
expected to depend upon patents, copyrights, trade secrets, know-how or other
proprietary information and the steps undertaken to secure and protect this
intellectual property, including any use of confidentiality agreements,
covenants-not-to-compete and the like. Summarize the principal terms and
expiration dates of any significant license agreements. Indicate the amounts
expended by the Company for research and development during the last fiscal
year, the amount expected to be spent this year and what percentage of revenues
research and development expenditures were for the last fiscal year.
The Company does not depend on patents, copyrights, trade secrets, or
proprietary know-how. The Company anticipates that some of its website
production and other materials will be copyrighted. The Company expended no
monies for research and development in previous years.
(i) If the Company's business, products, or properties are subject to
material regulation (including environmental regulation) by federal, state, or
local governmental agencies, indicate the nature and extent of regulation and
its effects or potential effects upon the Company.
The Company is not subject to governmental regulation in its internet
publishing efforts other than local state and municipal sales tax licenses.
(j) State the names of any subsidiaries of the Company, their business
purposes and ownership, and indicate which are included in the Financial
Statements attached hereto. If not included, or if included by not consolidated,
please explain.
NONE
(k) Summarize the material events in the development of the Company
(including any material mergers or acquisitions) during the past five years, or
<PAGE>
for whatever lesser period the Company has been in existence. Discuss any
pending or anticipated mergers, acquisitions, spin-offs or recapitalizations. If
the Company has recently undergone a stock split, stock dividend or
recapitalization in anticipation of this offering, describe (and adjust
historical per share figures elsewhere in this Offering Circular accordingly).
The Company is unable to ascertain what this last sentence means as this is not
an offering. Shares have already been sold.
The Company continues to be substantially a start-up company which,
although having been incorporated in 1994, has had no operations to this date
other than the preparatory efforts by its officers and directors in the work of
identifying its markets, producing a website for a client, and gathering of
information preliminary to designing its advertising campaigns.
In December of 1998, the directors of the Company deemed it in the best
interests of the Company to issue 150,000 shares of its Series 2 preferred stock
in exchange for cancellation of 18,300,000 shares of its common stock. The
preferences of the of the Series 2 common stock are the same as the preferred
stock then issued and outstanding.
4.
(a)If the Company was not profitable during its last fiscal year, list
below in chronological order the events which in management's opinion must or
should occur or the milestones which in management's opinion the Company must or
should reach in order for the Company to become profitable, and indicate the
expected manner of occurrence or the expected method by which the Company will
achieve the milestones.
- --------------------------------------------------------------------------------
Date or number of
months after receipt
Expected manner of occurrence of proceeds when
Event of Milestone or method of achievement should be accomplished
- --------------------------------------------------------------------------------
Continued development Officers' efforts 3 months
of design techniques
Preparation of advertising Officers' efforts 2 months
(b) State the probable consequences to the Company of delays in achieving
each of the events or milestones within the above time schedule, and
particularly the effect of any delays upon the Company's liquidity in view of
the Company's then anticipated level of operating costs. (See Question No. 11)
If the Company is unable to meet its deadline in the accomplishments of the
above milestones, the Company may be faced with the raising of additional equity
funds to continue its business plan. In this case there is no assurance
whatsoever that the Company will have these funds available. If not, the Company
may not be able to continue its operation.
<PAGE>
11. Indicate whether the Company is having or anticipates having within the
next 12 months any cash flow or liquidity problems and whether or not it is in
default or in breach of any note, loan, lease or other indebtedness or financing
arrangement requiring the Company to make payments. Indicate if a significant
amount of the Company's trade payables have not been paid within the stated
trade term. State whether the Company is subject to any unsatisfied judgments,
liens or settlement obligations and the amounts thereof. Indicate the Company's
plans to resolve any such problems.
The Company has no debt and no judgements pending or otherwise.
DIVIDENDS, DISTRIBUTIONS AND REDEMPTIONS
28. If the Company has within the last five years paid dividends, made
distributions upon its stock or redeemed any securities, explain how much and
when:
NONE
OFFICERS AND KEY PERSONNEL OF THE COMPANY
29. Chief Executive Officer: Title: President
Name: Gerald H. Trumbule Age: 56
Office Street Address: 1620 York St. Telephone No: 303-436-1847
Denver, CO 80206
GERALD H. TRUMBULE, Ph.D. has been the President of the Company since
January 2, 1997. Since 1979, Dr. Trumbule has been and currently is the
President of The Education Centers of Colorado, a private company which supplies
corporate computer training and support. Dr. Trumbule was the founder and
director of the Western States Film Institute and has directed over 50
commercials and documentaries in film and video. Dr. Trumbule was formerly the
founder and director of Sebastian House, Inc., a non-profit educational
corporation; Assistant Professor of Psychology, University of Toronto, Ontario;
Fellow, Institute of Neurological Sciences, University of Pennsylvania; and
Research Assistant, Walter Reed Army Institute of Research and NASA Space
Research Laboratory, College Park, MD. Dr. Trumbule's degrees include B.S.
Psychology - University of Maryland 1965, M.S. Experimental Psychology -
University of Pennsylvania 1966, and Ph.D. Physiological Psychology (ABD) -
University of Pennsylvania 1970.
Name of employers, titles and dates of positions held during past five years
with an indication of job responsibilities:
Also a Director of the Company? [x] Yes [ ] No
Indicate amount of time to be spend on Company matters if less than full
time: Four days per month until fully operational.
31. Chief Financial Officer: Title: Secretary
Name: Clark Burch Age: 56
<PAGE>
Office Street Address: 1620 York Street Telephone No: 303-436-1847
Denver, CO 80206
Name of employers, titles and dates of position held during past five years with
an indication of job responsibilities:
CLARK BURCH has been the Secretary and a Director of the Company since
January 2, 1997, and prior to that he was the President of the Company from
inception. He is a video producer- director of television productions. Mr. Burch
has been, and currently is, the President of ArtsWorth, Inc., a music and video
production company. Mr. Burch has produced and directed 110 half-hour programs
of "Comminatcha Live", a cable television series now in its third re-run. He has
produced the following video music productions: "Queen of the Night" - Julie
Young, performer 1985; "The Big Thompson" - Chuck Pyle, performer; and "Life
Explodes" - The Live Explodes Band. Mr. Burch obtained a Bachelor of Arts Degree
from Mankato State University in 1966. He is a member of the Rocky Mountain
Music Association, Denver, Colorado. From 1982 to 1985, Mr. Burch was actively
engaged as a licensed real estate agent.
Also a Director of the Company? [X] Yes [ ] No
Indicate amount of time to be spend on Company matters if less than full
time: Four days a month until fully operational.
DIRECTORS OF THE COMPANY
33. Number of Directors: 2.
If Directors are not elected annually, or are elected under a voting trust
or other arrangement, explain: NOT APPLICABLE.
34. Information concerning outside or other Directors (i.e., those not
described above): NOT APPLICABLE.
35. (a) Have any of the Officers or Directors ever worked for or managed a
company (including a separate subsidiary or division of a larger enterprise) in
the same business as the Company?
[ ] Yes [x] No
(b) If any of the Officers, Directors or other key personnel have ever worked
for or managed a company in the same business or industry as the Company or in a
related business or industry, describe what precautions, if any, (including the
obtaining of releases or consents from prior employers) have been taken to
preclude claims by prior employers for conversion or theft of trade secrets,
know-how or other proprietary information.
The officers and directors have never worked for or been involved in the
operation of another company which is devoted to the development of websites for
use on the internet.
<PAGE>
(c) If the Company has never conducted operations or is otherwise in the
development stage, indicate whether any of the Officers or Directors has ever
managed any other company in the start-up or development stage and describe the
circumstances, including relevant dates.
The officers and directors of the Company have never managed any other
company in the development stage similar to the operations of the Company.
(d) If any of the Company's key personnel are not employees but are consultants
or other independent contractors, state the details of their engagement by the
Company.
NONE
(e) If the Company has key man life insurance policies on any of its Officers,
Directors or key personnel, explain, including the names of the persons insured,
the amount of insurance, whether the insurance proceeds are payable to the
Company and whether there are arrangements that require the proceeds to be used
to redeem securities or pay benefits to the estate of the insured person or a
surviving spouse.
NONE
36. If a petition under the Bankruptcy Act or any State insolvency law was
filed by or against the Company or its Officers, Directors or other key
personnel, or a receiver, fiscal agent or similar officer was appointed by
a court for the business or property of any such persons, or any
partnership in which any of such persons was a general partner at or within
the past five years, or any corporation or business association of which
any such person was an executive officer at or within the past five years,
set forth below the name of such persons, and the nature and date of such
actions.
NOT APPLICABLE.
PRINCIPAL STOCKHOLDERS
37. Principal owners of the Company (those who beneficially own directly or
indirectly 10% or more of the common and preferred stock presently
outstanding) starting with the largest common stockholder. Include
separately all common stock issuable upon conversion of convertible
securities (identifying them by asterisk) and show average price per share
as if conversion has occurred. Indicate by footnote if the price paid was
for a consideration other than cash and the nature of any such
consideration.
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Average No. of Shares
Class Price No. of % Held After %
of Per Shares of Offering if All of
Shares Share Now Held Total Securities Sold Total
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Name: Gerald H. Trumbule Common $0005 50,000 2% 2% 2%
Office Street Address:
1620 York St.
Denver, CO 80206
Telephone No:
303.436-1847
Principal occupation:
Computer Consultant
Name: Clark Burch Common $.0005 50,000 2% 2% 2%
Office Street Address:
1620 York St.
Denver, CO 80206
Telephone No:
303-436-1847
Principal occupation:
Multi-Media Consultant
Video Producter
</TABLE>
38. Number of shares beneficially owned by Officers and Directors as a group:
100,000
MANAGEMENT RELATIONSHIPS, TRANSACTIONS AND REMUNERATION
39.(a) If any of the Officers, Directors, key personnel or principal
stockholders are related by blood or marriage, please describe. NOT APPLICABLE
(b) If the Company has made loans to or is doing business with any of its
Officers, Directors, key personnel or 10% stockholders, or any of their
relatives (or any entity controlled directly or indirectly by any such persons)
within the last two years, or proposes to do so within the future, explain.
(This includes sales or lease of goods, property or services to or from the
Company, employment or stock purchase contracts, etc.) State the principal terms
of any significant loans, agreements, leases, financing or other arrangements.
NONE
(c) If any of the Company's Officers, Directors, key personnel or 10%
stockholders has guaranteed or co-signed any of the Company's bank debt or other
obligations, including any indebtedness to be retired from the proceeds of this
offering, explain and state the amounts involved.
NONE.
40.(a) List all remuneration by the Company to Officers, Directors and key
personnel for the last fiscal year:
<PAGE>
No remuneration was paid to the officers or directors of the Company during
the past fiscal year.
41. (a) Number of shares subject to issuance under presently outstanding stock
purchase agreements, stock options, warrants or rights: shares ( % of total
shares to be outstanding after the completion of the offering if all securities
sold, assuming exercise of options and conversion of convertible securities).
Indicate which have been approved by shareholders. State the expiration dates,
exercise prices and other basic terms for these securities:
NOT APPLICABLE.
(b) Number of common shares subject to issuance under existing stock purchase or
option plans but not yet covered by outstanding purchase agreements, options or
warrants: shares.
NOT APPLICABLE.
(c) Describe the extent to which future stock purchase agreements, stock
options, warrants or rights must be approved by shareholders.
NOT APPLICABLE.
42. If the business is highly dependent on the services of certain key
personnel, describe any arrangements to assure that these persons will remain
with the Company and not compete upon any termination.
The business of the company is highly dependent upon the services of the
officers and directors of the Company. If these persons were not available for
any reason, the Company feels it would not be difficult to find other persons
with like-in-kind abilities, but it is undetermined whether the Company could
attract such persons at the price or salary which the Company might be able to
pay. The Company has no non-compete agreements with its officers and directors
and in the absence of such agreements, the Company is at risk with respect to
the competitiveness of its officers and directors if such persons decide to
leave the employ of the Company and seek other employment with companies which
may be in a position to compete. After reviewing the above, investors should
consider whether or not the compensation to management and other key personnel
directly or indirectly, is reasonable in view of the present stage of the
Company's development.
LITIGATION
43. Describe any past, pending or threatened litigation or administrative action
which has had or may have a material effect upon the Company's business,
financial condition, or operations, including any litigation or action involving
the Company's Officers, Directors or other key personnel. State the names of the
principal parties, the nature and current status of the matters, and amounts
involved. Give an evaluation by management or counsel, to the extent feasible,
of the merits of the proceedings or litigation and the potential impact on the
Company's business, financial condition, or operations.
<PAGE>
The Company is not subject to or engaged in any litigation of any kind and
none is anticipated.
MISCELLANEOUS FACTORS
45. Describe any other material factors, either adverse or favorable, that will
or could affect the Company or its business (for example, discuss any defaults
under major contracts, any breach of bylaw provisions, etc.) or which are
necessary to make any other information in this Offering Circular [registration
statement in this case as this is not an offering circular] not misleading or
incomplete.
The Company has had only a small success in its its marketing plan and the
operation of its business. It has sold only one contract for the production of a
website. The Company anticipates that its growth, if any, may well take longer
than originally anticipated at the time of its formation. The Company feels that
the reason for its lack of progress of its business plan is the lack of sales
for the production of websites for its prospective clients. In order for the
company grow as intended, the Company must expand its sales efforts.
Year 2000 Issues. The business of the Company, the design and development
of internet web sites, may be impacted only slightly by the anticipated problems
of its computers being unable to categorically assemble the use and
implementation of the year "2000" in its internal computations. The business of
the Company requires no use of accounting or computation programs. It is
estimated that the business of the Company will be impacted only by any adverse
impact upon its clients and customers, the effect of which is not ascertainable
at this time. Web sites, as designed and installed by the Company for its
clients, are inherently a graphics arts endeavor, and are generally used as a
sales, advertising and information medium.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
CERTAIN RELEVANT FACTORS
47. If the Company's financial statements show losses from operations, explain
the causes underlying these losses and what steps the Company has taken or is
taking to address these causes.
The Company has had little and no profits since its commencement. This is
due primarily to the Company's activities encompassing substantially developing
the technique for design of websites. Of the Company cannot increase its sales ,
the Company will be in serious difficulty in continuing its business plan. The
prospect of raising more capital for the continuation of the Company will need
to be considered seriously.
48. Describe any trends in the Company's historical operating results. Indicate
any changes now occurring in the underlying economics of the industry or the
Company's business which, in the opinion of Management, will have a significant
impact (either favorable or adverse) upon the Company's results of operations
within the next 12 months, and give a rough estimate of the probable extent of
the impact, if possible.
The Company has ascertained that the design and production of websites for
the internet has become more sophisticated over the past year. Clients are
demanding better and more complex designs for their respective websites. The
<PAGE>
Company believes that this will continue to increase and become more complex.
The management of the Company believes that this may work to the advantage of
the Company in that the members of management may well be able to present
techniques that others cannot or find difficult, i.e. the production of video
segments which can be incorporated into the websites.
49. If the Company sells a product or products and has had significant sales
during its last fiscal year, state the existing gross margin (net sales less
cost of such sales as presented in accordance with generally accepted accounting
principals) as a percentage of sales for the last fiscal year: %. What is the
anticipated gross margin for next year of operations? Approximately %. If this
is expected to change, explain. Also, if reasonably current gross margin figures
are available for the industry, indicate these figures and the source or sources
from which they are obtained.
The Company has had only one sale and small revenues.
50. Foreign sales as a percent of total sales for last fiscal year: %. Domestic
government sales as a percent of total domestic sales for last fiscal year: %.
Explain the nature of these sales, including any anticipated changes:
The Company has had no foreign sales or revenues therefrom and does not
contemplate any such sales or revenues in the future.
PART II
Item 1. Market Price of and Dividends on the Registrant's Common Equity and
Other shareholder matters.
Information required by Item 201 of Regulation S-B.
(a) Market Information. There is no current market price on the Company's
common stock as the shares are not trading at the time of this report.
(b) Holders. At the date of December 31, there are 43 holders of the common
equity of the Company.
(c) Dividends. The Company has paid no dividends and does not contemplate
any dividends during the next two fiscal years.
Item 2. Legal Proceedings
If the registrant uses either Alternative 2 or Alternative 3 of this form,
furnish the information required by Item 103 of Regulation S-B.
<PAGE>
NOT APPLICABLE. The registrant is using Alternative 1.
Item 3. Changes in and Disagreements with Accountants
Furnish the information required by Item 304 of Regulation S-B.
There have been no changes of and no disagreement with accountants on
accounting and financial disclosure.
Item 4. Submission of Matters to a Vote of Security Holders
If any matter was submitted during the fourth quarter of the fiscal year
covered by this report to a vote of security holders, through the solicitation
of proxies or otherwise, furnish the following information:
No matter was submitted to the securities holders as described above.
Item 5. Compliance with Section 16(a) of the Exchange Act
Gerald H. Trumbule, President and Director. No changes since registration.
Clark Burch, Secretary and Director. No changes since registration.
Mansfield Consultants Limited exchanged 18,300,000 shares of no par common
stock for 150,000 shares of no par preferred stock on December 21, 1998,
reducing the shares of common stock held by Mansfield Consultants Limited to
50,000 shares at the date of this report.
Item 6. Reports on form 8-K
State whether any reports on Form 8-K were filed during the last quarter of
the period covered by this report, listing the times reported, any financial
statement filed and the dates of such report.
No Current Reports on Form 8-K were filed during the last fiscal
quarter-year.
PART F/S
Furnish the information required by Item 310 of Regulation S-B.
The audited financial statements for the fiscal year ended December 31,
1998, follow:
<PAGE>
I-Tech Holdings Group, Inc.
FINANCIAL STATEMENTS
with
Independent Auditors' Report
For the Years Ended December 31, 1998 and 1997
<PAGE>
I-Tech Holdings Group, Inc.
TABLE OF CONTENTS
Page
----
Independent Auditors' Report F-1
Financial Statements
Balance Sheet F-2
Statement of Operations F-3
Statement of Cash Flows F-4
Statement of Shareholder's Equity F-5 - F-6
Notes to the Financial Statements F-7 - F-9
<PAGE>
Kish * Leake & Associates, P.C.
Certified Public Accountants
Independent Auditor's Report
----------------------------
We have audited the accompanying balance sheet of I-Tech Holdings Group, Inc. (a
Developmental Stage Company), at December 31, 1998 and 1997, and the related
statement of operations, shareholders' equity, and cash flows for the year ended
December 31, 1998 and 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our 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 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 I-Tech Holdings Group, Inc. at
December 31, 1998 and 1997 and the results of its operations and its cash flows
for the years ended December 31, 1998 and 1997, in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 4 to the financial
statements, the Company is in the development stage and has no operations as of
December 31, 1998. The lack of sufficient working capital to operate as of
December 31, 1998 raises substantial doubt about its ability to continue as a
going concern. Management's plans concerning these matters are also described in
Note 4. 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
January 22, 1999
F-1
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Balance Sheet
- --------------------------------------------------------------------------------
December
31, 1998
--------
ASSETS
Current Assets - Cash $ 3,272
========
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES - Due To Related Entity For Rent $ 2,600
--------
SHAREHOLDERS' EQUITY
Preferred Stock, No Par Value,
Non Voting, Authorized 5,000,000 shares;
Issued and Outstanding 300,000 Shares 3,000
Issued and Outstanding 150,000 Series 2 Shares 9,150
Common Stock, No Par Value
Authorized 50,000,000 shares; Issued and
Outstanding 2,080,000 Shares 1,330
(Deficit) Accumulated During The Development Stage (12,808)
--------
TOTAL SHAREHOLDERS' EQUITY 672
--------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 3,272
========
The Accompanying Notes Are An Integral Part Of These Financial Statements.
F-2
<PAGE>
<TABLE>
<CAPTION>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Statement Of Operations
- -----------------------------------------------------------------------------------------
December
6, 1994
(Inception)
Year Ended Year Ended Through
December December December
31, 1998 31, 1997 31, 1998
-------- -------- --------
<S> <C> <C> <C>
Revenue $ 500 $ 0 $ 500
------------ ------------ ------------
Consulting 0 0 380
Fees 0 265 265
Legal & Accounting 2,850 3,750 6,600
Office 1,499 122 1,621
Rent 1,200 1,100 2,400
Stock Transfer 1,062 980 2,042
------------ ------------ ------------
Total Expenses 6,611 6,217 13,308
------------ ------------ ------------
Net (Loss) ($ 6,111) ($ 6,217) (12,808)
============ ============ ============
Basic (Loss) Per Common Share ($ 0.00) ($ 0.00)
============ ============
Weighted Average Common Shares Outstanding 2,080,000 13,713,333
============ ============
The Accompanying Notes Are An Integral Part Of These Financial Statements.
F-3
</TABLE>
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Statement Of Cash Flow
- --------------------------------------------------------------------------------
December
6, 1994
(Inception)
Year Ended Year Ended Through
December December December
31, 1998 31, 1996 31, 1998
-------- -------- --------
Net (Loss) ($ 6,111) ($ 6,217) ($12,808)
-------- -------- --------
Plus Items Not Affecting Cash Flow: 0 0 0
Stock Issued For Services 380
Increase In Accounts Payable 1,500 1,100 2,600
-------- -------- --------
Net Cash Flows From Operations (4,611) (5,117) (9,828)
-------- -------- --------
Cash Flows From Investing Activities:
Net Cash Flows From Investing: 0 0 0
-------- -------- --------
Cash Flows From Financing Activities:
Common Stock Issued For Cash 0 10,000 10,000
Contributed Capital 0 0 100
Preferred Stock Issued For Cash 0 3,000 3,000
-------- -------- --------
Net Cash Flows From Financing: 0 13,000 13,100
-------- -------- --------
Net Increase (Decrease) In Cash (4,611) 7,883 3,272
Cash At Beginning Of Period 7,883 0 0
-------- -------- --------
Cash At End Of Period $ 3,272 $ 7,883 $ 3,272
======== ======== ========
Summary Of Non-Cash Investing And Financing
Activities:
Common Stock Issued For Services $ 0 $ 0 $ 380
======== ======== ========
Series 2 Preferred Stock Issued in Exchange
For 18,300,000 Shares of Common Stock $ 9,150 $ 0 $ 9,150
======== ======== ========
The Accompanying Notes Are An Integral Part Of These Financial Statements.
F-4
<PAGE>
<TABLE>
<CAPTION>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Statement Of Shareholders' Equity
- -------------------------------------------------------------------------------------------------------------
Number Of
Number Of Number Of Shares
Shares Shares Series 2 Common Preferred
Common Preferred Preferred Stock Stock
------ --------- --------- ----- -----
<S> <C> <C> <C> <C> <C>
Balance At December 6, 1994 0 0 0 $ 0 $ 0
June 15, 1995 issued
380,000 Shares Of No Par Value
Common Stock for services valued at
$380 or $.001 per share 380,000 380
Additional Capital Contribution 100
Net (Loss)
----------- ----------- ----------- ----------- -----------
Balance At December 31, 1995 380,000 0 0 480 0
Net (Loss)
----------- ----------- ----------- ----------- -----------
Balance At December 31, 1996 380,000 0 0 480 0
January 2, 1997 issued
300,000 Shares Of No Par Value
Preferred Stock for $3,000 or
$.01 per share 300,000 3,000
March & May, 1997 issued
20,000,000 Shares Of No Par Value
Common Stock for $10,000 or
$.0005 per share 20,000,000 10,000
Net (Loss)
----------- ----------- ----------- ----------- -----------
Balance At December 31, 1997 20,380,000 300,000 0 10,480 3,000
Series 2 Preferred Stock Exchanged
For Common Stock (18,300,000) 150,000 (9,150)
Net (Loss)
----------- ----------- ----------- ----------- -----------
Balance At December 31, 1998 2,080,000 300,000 150,000 $ 1,330 $ 3,000
=========== =========== =========== =========== ===========
F-5
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Statement Of Shareholders' Equity (Continued)
- --------------------------------------------------------------------------------
Net (Loss)
Accumulated
Series 2 During The
Preferred Development
Stock Stage Total
----- ----- -----
Balance At December 6, 1994 $ 0 $ 0 $ 0
June 15, 1995 issued
380,000 Shares Of No Par Value
Common Stock for services valued at
$380 or $.001 per share 380
Additional Capital Contribution 100
Net (Loss) (380) (380)
----------- ----------- -----------
Balance At December 31, 1995 0 (380) 100
Net (Loss) (100) (100)
----------- ----------- -----------
Balance At December 31, 1996 0 (480) 0
January 2, 1997 issued
300,000 Shares Of No Par Value
Preferred Stock for $3,000 or
$.01 per share 3,000
March & May, 1997 issued
20,000,000 Shares Of No Par Value
Common Stock for $10,000 or
$.0005 per share 10,000
Net (Loss) (6,217) (6,217)
----------- ----------- -----------
Balance At December 31, 1997 0 (6,697) 6,783
Series 2 Preferred Stock Exchanged
For Common Stock 9,150 0
Net (Loss) (6,111) (6,111)
----------- ----------- -----------
Balance At December 31, 1998 $ 9,150 ($ 12,808) $ 672
=========== =========== ===========
The Accompanying Notes Are An Integral Part Of These Financial Statements.
F-6
</TABLE>
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Notes to Financial Statements
At December 31, 1998 and 1997
- -----------------------------
Note 1 - Organization and Summary of Significant Accounting Policies
- --------------------------------------------------------------------
Organization:
- -------------
On December 6, 1994, I-Tech Holdings Group, Inc. ("the Company") was
incorporated under the laws of Colorado, to engage in the business of
environmental technologies of all types and manufacturing products related to
environmental technologies. The Company may also engage in any business which is
permitted by the Colorado Business Corporation Act, as designated by the board
of directors of the Company. In January 1997, the Company elected to engage in
the business of consulting services to develop web sites for business and
industry.
Developmental Stage:
The Company is currently in the developmental stage and has no significant
operations to date.
Income Taxes:
At December 31, 1998 and 1997, the company had net operating loss carry forwards
available for financial statement and Federal income tax purposes of
approximately $10,408 which, if not used, will expire beginning in the year
2008.
The Company follows Financial Accounting Standards Board Statement No. 109,
"Accounting for Income Taxes" (SFAS #109), which requires, among other things,
an asset and liability approach to calculating deferred income taxes. As of
December 31, 1998, the Company has a deferred tax asset of $2,082 primarily for
its net operating loss carry forward which has been fully reserved through a
valuation allowance. The change in the valuation allowance from December 31,
1997 to December 31, 1998 was $1,004.
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 and taxes in the period ended December 31, 1998 and 1997
was $-0-.
F-7
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Notes to Financial Statements
At December 31, 1998 and 1997
- -----------------------------
Net (Loss) Per Common Share:
The net (loss) per common share is computed by dividing the net (Loss) for the
period by the weighted average number of shares outstanding at December 31, 1998
and 1997.
Note 2 - Capital Stock
- ----------------------
Common Stock:
The Company initially authorized 50,000,000 shares of no par value common stock.
On June 15, 1995 380,000 shares of no par common stock were issued for services
valued at $380 or $.001 per share. In March and May 1997 the Company issued an
additional 20,000,000 shares of common stock for $10,000 or $.0005 per share.
Preferred Stock
The Company initially authorized 5,000,000 shares of no par value, non-voting
preferred stock.
On January 22, 1997, the Company issued 300,000 shares of its preferred stock
for $3,000 or $.01 per share. The Directors have assigned the following
preferences to the issued and outstanding shares of Preferred Stock: (I) the
Preferred Stock shall be non-voting, (ii) the holders of the stock as a group
have the right to receive, prorata, upon dissolution or winding up of the
Company, 10% of the assets of the Company prior to division and distribution of
assets to the holders of the Company's Common Stock.
On December , 1998, the Company issued 150,000 shares of series 2 preferred
stock in exchange for the cancellation of 18,300,000 shares of its common stock.
The Directors have assigned the following preferences to the issued and
outstanding shares of Preferred Stock: (I) the Preferred Stock shall be
non-voting, (ii) the holders of the stock as a group have the right to receive,
prorata, upon dissolution or winding up of the Company, 10% of the assets of the
Company prior to division and distribution of assets to the holders of the
Company's Common Stock.
The Company has declared no dividends through December 31, 1998.
F-8
<PAGE>
I-Tech Holdings Group, Inc.
(A Development Stage Company)
Notes to Financial Statements
At December 31, 1998 and 1997
- -----------------------------
Note 3 - Related Party Events
- -----------------------------
The Company presently maintains its principal offices at an address provided by
a related party at a monthly rental of $100 per month, plus any expenses of
telephone, fax, and secretarial services, commencing February 1, 1997. The
office is located at 1629 York Street, Denver, Colorado 80206.
Note 4 - 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 plans to continue financing its operations with stock sales and in
the longer term, revenues from its operations. The Company's ability to continue
as a going concern is dependent upon the successful completion of its offering
of common stock, additional financing and, ultimately, upon achieving profitable
operations.
F-9
<PAGE>
PART III
Item 1. Index to Exhibits
Exhibits required in Part III of Form 1-A
Exhibit Number: Description
Exhibit No. 2. Plan of Acquisition Not Applicable
Exhibit No. 3. Charter and Bylaws Previously Filed
Exhibit No. 5. Voting trust agreement Not applicable
Exhibit No. 6. Material contracts Not applicable
Exhibit No. 7. Material foreign patents Not applicable
Exhibit No. 11. Statement re: computation
of per share earnings Not applicable
Exhibit No. 24. Power of attorney Not applicable
Exhibit No. 27. Financial Data Schedule Attached
- --------------------------------------------------------------------------------
Signatures
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
I-TECH HOLDING GROUP, INC.
(Registrant)
Date: February 24, 1999
/s/ Clark Burch
-----------------------------------
Clark Burch, Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 3,272
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,272
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,272
<CURRENT-LIABILITIES> 2,600
<BONDS> 0
0
12,150
<COMMON> 1,330
<OTHER-SE> (12,808)
<TOTAL-LIABILITY-AND-EQUITY> 3,272
<SALES> 500
<TOTAL-REVENUES> 500
<CGS> 0
<TOTAL-COSTS> 6,611
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (6,611)
<INCOME-TAX> 0
<INCOME-CONTINUING> (6,611)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,611)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
