POWER TECHNOLOGY INC/CN, S-1, 2000-11-17

POWER TECHNOLOGY INC/CN
S-1, 2000-11-17
MOTOR VEHICLE PARTS & ACCESSORIES

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<PAGE>

As filed with the U.S. Securities and Exchange Commission on November 17, 2000
Registration No. 333-_________

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Power Technology, Inc.
------------------------------------------------------------
(Exact name of registrant as specified in its charter)

Nevada
------------------------------------------------------------
(State or other jurisdiction of incorporation or organization)

541710
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(Primary Standard Industrial Classification Code Number)

88-0395816
------------------------------------------------------------
(I.R.S. Employer Identification Number)

Lee A. Balak, President
Power Technology, Inc.
1000 West Bonanza, Las Vegas, Nevada 89106 (702) 382-3385
------------------------------------------------------------
(Address, including zip code, and telephone number,
including area code, of agent for service)

Copies to:

Stephen A. Zrenda, Jr., Esq.
Stephen A. Zrenda, Jr., P.C.
100 North Broadway
2100 Bank One Center
Oklahoma City, Oklahoma 73102-8601

As soon as practicable after effective date of this Registration Statement
--------------------------------------------------------------------------
(Approximate date of commencement of proposed sale to the public)

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box: /X/

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /

<PAGE>

CALCULATION OF REGISTRATION FEE

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Title of Each Class
of Securities to Shares to be Proposed Maximum Aggregate
be Registered Registered Offering Price(1) Amount of Registration Fee (1)
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<S> <C> <C> <C>
Common Stock 25,170,000 $26,357,520 $7,327
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Common Stock from exercise of warrants

4,990,000
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Common Stock from conversion of notes

2,000,000
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Common Stock from exercise of options

299,999
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</TABLE>

--------------------------------
(1) Estimated pursuant to Rule 457(c) under the Securities Act, solely for
the purpose of calculating the registration fee, based on the closing
price of $.812 of the Company's common stock at the close of business
on November 9, 2000.

The registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the
registration statement shall become effective on such date as the Securities
and Exchange Commission acting pursuant to section 8(a), may determine.

The information in this preliminary prospectus is not complete and
may be changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. The
preliminary prospectus is not an offer to sell these securities and is not
soliciting an offer to buy these securities in any state where the offer or
sale is not permitted.

<PAGE>

PART I - INFORMATION REQUIRED IN PROSPECTUS

ITEM CROSS REFERENCE
---- ---------------
<S> <C>
Item 1. Forepart of the Registration Statement and Outside Front Cover Page
Cover Page of Prospectus. and Summary

Item 2. Inside Front and Outside Back Cover Page of Prospectus. Inside Front Cover
and Outside Back Cover

Item 3. Summary Information, Risk Factors and Ratio of Earnings Summary; and
to Fixed Charges. Risk Factors

Item 4. Use of Proceeds. Use of Proceeds

Item 5. Determination of Offering Price. Dilution

Item 6. Dilution. Dilution

Item 7. Selling Security Holders. Selling Stockholders

Item 8. Plan of Distribution. Plan of Distribution

Item 9. Description of Securities to be Registered. Description of Capital Stock

Item 10. Interests of Named Experts and Counsel. Experts

Item 11. Information with Respect to the Registrant. Where You Can Find
Additional Information

Item 12. Disclosure of Commission Position on Indemnification for Part II, Item 14
Securities Act Liabilities.

</TABLE>

<PAGE>

SUBJECT TO COMPLETION, NOVEMBER 17, 2000

PROSPECTUS

POWER TECHNOLOGY, INC.

32,459,999 shares

Common Stock

This Prospectus related to the resale of up to 32,459,999 shares of
the Common Stock of Power Technology, Inc., a Nevada corporation (the
"Company") by the Selling Stockholders at a selling price to be determined by
market factors at the time of their resale in the over-the-counter market at
their then prevailing market price or in negotiated transactions.

The Company presently has 18,509,305 shares issued and outstanding as
of the date of the Prospectus. The Company may issue up to 25,000,000 shares
of Common Stock to Swartz Private Equity, L.L.C. ("Swartz") based upon its
Investment Agreement with the Company dated April 17, 2000; which shares are
offered for resale by this Prospectus. This Prospectus also offers the resale
of up to 490,000 shares of Common Stock that may be acquired from the Company
by Swartz upon the exercise of its outstanding warrant to purchase these
shares from the Company. This Prospectus also offers the resale of up to
2,500,000 shares of Common Stock of the Company that may be acquired by Swartz
through the exercise of additional warrants that may be issued to Swartz
during the term of its Investment Agreement with the Company. In addition,
this Prospectus covers the resale of 4,000,000 shares of Common Stock of the
Company to be acquired by certain Noteholders, who presently hold $1,000,000 of
the Series A Convertible Notes of the Company and warrants to purchase shares
of the Company at $.60 per share. The Prospectus also covers the resale of up
to 170,000 shares of Common Stock acquired by a consultant to the Company in
exchange for previous and future public relations services, and 299,999 shares
of Common Stock issuable to consultants upon their exercise of stock options
exercisable at prices ranging from $.625 to $4.00 per share.

The Company will receive no proceeds from the resale of the shares
offered by the Selling Stockholders. However, we will receive approximately
$13,225,000 of the proceeds from the sale of the shares to the Selling
Stockholders and the conversion of its Series A Convertible Notes, and we may
receive additional proceeds of up to $3,598,397 from the exercise by the
Selling Stockholders of shares issuable upon the exercise of any warrants and
options issued or that may be issued to the Selling Stockholders.

Our Common Stock is quoted on the over-the-counter Electronic
Bulletin Board market under the symbol PWTC. On November 9, 2000, the closing
price of the Common Stock on the NASD Electronic Bulletin Board was $.812 per
share.

Please read this Prospectus carefully. It describes our Company's
finances and business. Federal and state securities laws require that we
include in this Prospectus all the important information that you will need to
make an investment decision.

You should rely only on the information contained or incorporated by
reference in this Prospectus to make your investment decision. We have not
authorized anyone to provide you with different information. The Selling
Stockholders are not offering these securities in any state where the offer is
not permitted. You should not assume that the information in this Prospectus
is accurate as of any date other than the date on the front page of this
Prospectus or in a supplement provided by the Company.

INVESTING IN THE COMMON STOCK OF THE COMPANY INVOLVES A HIGH DEGREE
OF RISK. YOU SHOULD INVEST IN THE COMMON STOCK ONLY IF YOU CAN AFFORD TO LOSE
YOUR ENTIRE INVESTMENT. SEE "RISK FACTORS" BEGINNING ON PAGE 6 OF THIS
PROSPECTUS.

<PAGE>

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

Power Technology, Inc.
100 West Bonanza
Las Vegas, Nevada 89106
(702) 382-3385

<PAGE>

The Date of this Prospectus is _______________________ , 2000.

The following table of contents has been designed to help you find
important information contained in this Prospectus. We encourage you to read
the entire Prospectus.

TABLE OF CONTENTS

Page Page
<S> <C> <C> <C>
Prospectus Summary................................ 4 Plan of Distribution..............................33

Summary Financial Information..................... 5 Management .......................................34

Risk Factors...................................... 6 Certain Transactions..............................36

Forward-Looking Statements........................13 Principal Stockholders............................37

Use of Proceeds...................................14 Description of Capital Stock......................39

Dividend Policy...................................14 Shares Eligible for Future Sale...................41

Price Range of Common Stock ......................14 Legal Matters.....................................41

Capitalization....................................16 Experts...........................................41

Management's Discussion and Where You Can Find Additional
Analysis of Financial Condition Information.......................................42
and Results of Operations.....................17
Consolidated Financial Statements................F-1

Business..........................................25

Selling Stockholders..............................30

</TABLE>

---------------------------------------------------------

Some of the statements contained in this Prospectus, including
statements under "Prospectus Summary", Risk Factor", "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and "Business",
are forward-looking and may involve a number of risks and uncertainties.
Actual results and future events may differ significantly based upon an number
of factors, including:

- our significant historical losses and the expectation of
continuing losses;
- rapid technological change in the industry;
- our reliance on key strategic relationships;
- the impact of competitive products and services and pricing;
and
- uncertain protection of our intellectual property.

<PAGE>

PROSPECTUS SUMMARY

This summary highlights selected information contained elsewhere in
this Prospectus. This summary does not contain all of the information you should
consider before investing in our Common Stock. You should read the entire
Prospectus carefully, including "Risk Factors" and our consolidated financial
statements and notes to those consolidated financial statements before making an
investment decision.

Power Technology, Inc. (the "Company"), a Nevada corporation, was
incorporated on June 3, 1996. However, the Company did not conduct any
significant operations until March 1998 when it acquired all of the issued
and outstanding capital stock and assets of PowerTek Technology Corporation,
Inc. (formerly called Power Technology, Inc.) which is presently a
wholly-owned subsidiary of the Company. The Company changed its corporate
name from "Zepplin Production Corp." to Power Technology, Inc. during March
1998 to reflect the change in the purposes and nature of its business.

The Company is a research and development company. It is presently
engaged in research and development activities regarding (i) batteries for the
automotive and electric car industries, (2) electronic sensors, (3) pipeline
connection technology, and (4) agricultural grain drying equipment.

The business objective of the Company has been to create and
commercialize new products and to license its technologies to unaffiliated
companies to manufacture and market its products. As of the date of the
Prospectus, the Company has not completed its development activities regarding
any of its products, and has no licensing or manufacturing agreements to
commercialize its products.

<TABLE>
<CAPTION>
The Offering
<S> <C>
Common Stock outstanding
prior to the offering 18,509,305 shares (1)

Shares being offered for resale to
the public by Selling Stockholders 32,459,999

Common Stock to be outstanding
after this offering (2) 50,969,304 shares

Price per share to the public Market price at time of resale

Total proceeds raised by offering None to the Company; however, we will
receive the proceeds from the previous sale of
shares that are to be issued to the Selling
Stockholders. We may receive up to
$13,225,000 from the sale of shares to the
Selling Stockholders, including the
conversion of outstanding convertible notes,
and we may receive additional amounts of up to
$3,598,397 from the sale of shares issuable upon the
exercise of warrants and options issued to the
Selling Stockholders.
Use of proceeds from the sale of
the shares to the Selling Stockholders We plan to use the proceeds from the sale of
the shares to the Selling Stockholders for
working capital and general corporate
purposes.

Over-the-Counter Market Symbol PWTC
</TABLE>

4
<PAGE>

(1) The number of shares of Common Stock to be outstanding upon completion
of this offering is based on the number of shares outstanding as of
September 30, 2000, and excludes:

- 2,380,000 shares of Common Stock issuable upon
exercise of outstanding options at a weighted average
exercise price of $.57 per share;

- 2,000,000 additional shares of Common Stock approved
for issuance under a stock plan and bonus plan
adopted by the shareholders at the September 14,
2000, Annual Shareholders' Meeting. No options or
stock bonuses have been granted or issued under this
new plan.

SUMMARY FINANCIAL INFORMATION

The following table sets forth summary financial data for our Company.
You should read this information together with the consolidated financial
statements and the notes to those statements appearing elsewhere in this
Prospectus and the information under "Selected Financial Data" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations".

<TABLE>
<CAPTION>
Years Ended January 31,
-----------------------
Six Months
Ended
Statements of Operations Data 1997 1998 1999 2000 July 31, 2000
---- ---- ---- ---- (unaudited)
<S> <C> <C> <C> <C> <C>
Revenues $ 0 $ 0 $ 0 $ 0 $ 0

Operating expenses:

Research and development $ 0 $ 0 $ 166,936 $ 105,164 $ 188,169

General administrative $ 139,907 $ 51,374 $ 515,588 $ 803,311 $ 594,204

Total operating expenses $ 139,907 $ 51,374 $ 682,524 $ 908,475 $ 782,373

Operating loss $ (139,907) $ (51,374) $ (682,524) $ (908,475) $ (782,373)

Interest income, net $ 0 $ 0 $ 0 $ 0 $ 0

Net loss $ (139,907) $ (51,374) $ (682,524) $ (908,475) $ (782,373)

Basic and diluted net loss per
share $ (.06) $ (.02) $ (.07) $ (.05) $ (.04)

Pro forma basic and diluted
net loss per share (1) $ (.06) $ (.02) $ (.07) $ (.05) $ (.04)

Shares used in computing pro
forma basic and diluted net
loss per share (1) 2,500,000 2,500,000 9,667,208 16,817,500 17,664,000
</TABLE>

5
<PAGE>

<TABLE>
<CAPTION>
Years Ended January 31,
-----------------------
Six Months ended
July 31, 2000
Balance Sheet Data 1998 1999 2000 ----------------
---- ---- ---- (unaudited)
<S> <C> <C> <C> <C>
Cash, cash equivalents and
short-term investments $ 0 $ 60,499 $ 76,015 $ 232,114

Working capital (deficit) $ $(128,647) $ (272,785) $ (602,154)

Total assets $ 15,000 $ 169,383 $ 178,846 $ 352,256

Long-term debt, less
current portion $ 0 $ 0 $ 0 $ 0

Accumulated deficit $ (191,281) $(892,190) $(1,780,665) $(2,563,038)
</TABLE>

RISK FACTORS

You should carefully consider the risks described below together with
all of the other information included in this Prospectus before making an
investment decision. If any of the following risks actually occurs, our
business, financial condition or results of operations could be harmed. In such
an event, the trading price of our Common Stock could decline, and you may lose
all or part of your investment.

Risks Related To Our Business

IF OUR PRODUCTS AND SERVICES DO NOT BECOME WIDELY USED IN INDUSTRY, IT IS
UNLIKELY THAT WE WILL BE PROFITABLE.

Compared to other technologies, our technologies are new and unproven,
and the use of our technology by other companies is limited. In addition, we
have a limited history of offering our products and services. It is uncertain
whether our new customers will use these products and services. In order to be
successful, our products and services must meet the requirements of the industry
involved in each product, and we must convince potential customers to use our
products and services instead of competing technologies. Market acceptance will
depend on many factors, including our ability to:

- convince potential customers that our technologies are attractive
alternatives to other technologies;

- manufacture products and conduct services in sufficient
quantities with acceptable quality and at an acceptable cost;

- convince potential customers to purchase our products and
services from us rather than developing them internally; and

- place and service sufficient quantities of our products.

Because of these and other factors, our products and services may not gain
market acceptance.

WE MAY FAIL TO ESTABLISH AND EXPAND CUSTOMER RELATIONSHIPS.

We may not be successful in selling our products because our products
and services may not achieve time and cost efficiencies for our customers. We
may not be able to use existing relationships with customers in individual areas
of our business to sell products and services in multiple areas of technology.
As a result, we may not be able to take advantage of potential revenue
opportunities.

<PAGE>

OUR SUCCESS WILL DEPEND ON OUR ABILITY TO MANAGE RAPID GROWTH AND EXPANSION.

Growth in our research and development operations has placed and will
continue to place a significant strain on our operational, human and financial
resources. It is also possible that we may not experience any future growth. Our
ability to compete effectively will depend, in large part, on our ability to
hire, train and assimilate additional management, professional, scientific and
technical personnel and our ability to expand, improve and effectively use our
operating, management, marketing and financial systems to accommodate our
expanded operations. The physical expansion of our facilities to accommodate
future growth may lead to significant costs and divert management and business
development resources. If we fail effectively to anticipate, implement and
manage the changes required to sustain our growth, we may not be able to compete
successfully.

OUR PRODUCTS HAVE LENGTHY SALES CYCLES, WHICH COULD CAUSE OUR OPERATING RESULTS
TO FLUCTUATE SIGNIFICANTLY FROM QUARTER TO QUARTER.

Sales of our products and research services typically involve
significant technical evaluations and commitment of capital by the Company and
by our customers. Accordingly, the sales cycles associated with these products
are expected to be lengthy and subject to a number of significant risks,
including customers' budgetary constraints and internal acceptance reviews that
are beyond our control. Due to these lengthy and unpredictable sales cycles, our
operating results could fluctuate significantly from quarter to quarter. We
expect to continue to experience significant fluctuations in quarterly operating
results as a result of a variety of factors, such as general and industry
specific economic conditions which may affect the research and development
expenditures of our customers.

A large portion of our expenses, including expenses for facilities,
equipment and personnel, are relatively fixed. Accordingly, if revenues do not
grow as anticipated, we might not be able to correspondingly reduce our
operating expenses. Failure to achieve anticipated levels of revenues could
therefore significantly harm our operating results for a particular fiscal
period.

Due to the possibility of fluctuations in our revenues and expenses, we
believe that quarter-to-quarter comparisons of our operating results are not a
good indication of our future performance. Our operating results in some
quarters may not meet the expectations of stock market analysts and investors.
In that case, our stock price would probably decline.

WE DEPEND ON THIRD-PARTY PRODUCTS AND SERVICES, AND SOLE OR LIMITED SOURCES OF
SUPPLY TO MANUFACTURE SOME COMPONENTS OF OUR PRODUCTS.

We rely on outside vendors to manufacture many of the components and
subassemblies used in our products. Some of these components and subassemblies
are obtained from a single supplier or a limited group of suppliers. Our
reliance on outside vendors generally, and a sole or limited group of suppliers
in particular, involves several risks, including:

- the inability to obtain an adequate supply of required
components due to manufacturing capacity constraints, a
discontinuance of a product by a third-party manufacturer or
other supply constraints;

- reduced control over quality and pricing of components; and

- delays and long lead times in receiving materials from vendors.

OUR CUSTOMERS MAY RESTRICT OUR USE OF SCIENTIFIC INFORMATION.

We plan to generate and use information that is not proprietary to our
customers and that we derive from performing services for our customers.
However, our customers may not allow us to use information that we generate when
performing research services for them. Without this information, we may not be
able to develop certain technologies and may not be able to take advantage of
potential revenue opportunities.

7
<PAGE>

WE MAY NOT ACHIEVE OR SUSTAIN PROFITABILITY IN THE FUTURE.

We are at an early stage of executing our business plan. We have
incurred operating and net losses and negative cash flow from operations since
our inception. As of July 31, 2000, we had an accumulated deficit of $2,563,038.
For the years ended January 31, 1997, 1998, 1999 and 2000, and the six months
ended July 31, 2000, we had net losses of $1339,907, $51,374, $700,909, $908,475
and $782,373, respectively. We may also in the future incur operating and net
losses and negative cash flow from operations, due in part to anticipated
increases in expenses for research and product development, acquisitions of
complementary businesses and technologies and expansion of our sales and
marketing capabilities. Given our acquisition strategy, we expect significant
goodwill charges to affect our net income (loss) for the foreseeable future. We
may not be able to achieve or maintain profitability. Moreover, if we do achieve
profitability, the level of any profitability cannot be predicted and may vary
significantly from quarter to quarter.

OUR OPERATIONS COULD BE INTERRUPTED BY DAMAGE TO OUR FACILITIES.

Our results of operations are dependent upon the continued use of our
laboratories and equipment. Our operations are primarily concentrated in
facilities in Las Vegas, Nevada. Natural disasters, such as floods or
earthquakes, could damage our laboratories or equipment and these events may
materially interrupt our business. We will maintain business interruption
insurance to cover lost revenues caused by such occurrences. However, this
insurance would not compensate us for the loss of opportunity and potential
adverse impact on relations with existing customers created by an inability to
meet our customers' needs in a timely manner.

RISKS RELATED TO OPERATING IN OUR INDUSTRY

THE RESEARCH INDUSTRY IS HIGHLY COMPETITIVE AND SUBJECT TO RAPID TECHNOLOGICAL
CHANGE, AND WE MAY NOT HAVE THE RESOURCES NECESSARY TO COMPETE SUCCESSFULLY.

We compete with companies in the United States and abroad that are
engaged in the development and production of new products and research services.
Academic institutions, governmental agencies and other research organizations
also are conducting research in areas in which we provide services, either on
their own or through collaborative efforts. Also, in many cases, certain
prospective customers may have internal departments which provide products and
services similar to ours, so these customers may have limited need for our
products and services. Many of our competitors have access to greater financial,
technical, research, marketing, sales, distribution, service and other resources
than we do.

Moreover, the research business is characterized by rapid and
continuous technological innovation. We anticipate that we will face increased
competition in the future as new companies enter the market and advanced
technologies become available. Our products, services and expertise may be
rendered obsolete or uneconomical by technological advances or entirely
different approaches developed by us or one or more of our competitors. For
example, advances in this information may render some of our existing approaches
to our technologies obsolete. Additionally, the existing approaches of our
competitors may be more effective than those we develop. We may not be able to
compete successfully with existing or future competitors.

OUR SUCCESS WILL DEPEND ON THE PROSPECTS OF THE INDUSTRIES AND THE EXTENT TO
WHICH THESE INDUSTRIES USE THIRD-PARTY ASSISTANCE FOR WHICH WE CONDUCT RESEARCH
WITH ONE OR MORE ASPECTS OF THEIR BUSINESS.

Our revenues are highly dependent on research and development
expenditures by the battery, sensor, welding and agricultural industries and
outsourcing of research and development projects by companies in these
industries. These expenditures are based on a wide variety of factors, including
the resources available for purchasing research equipment, the spending
priorities among various types of research and policies regarding expenditures
during recessionary periods. Our operations could be materially adversely
affected by general economic downturns in our customers' industries or any
decrease in research and development expenditures. Any decrease in spending by
such companies could cause our revenues to decline and adversely impact our
profitability.

<PAGE>

OUR SUCCESS WILL DEPEND ON OUR ABILITY TO ATTRACT AND RETAIN EXPERIENCED
SCIENTISTS AND SALES PERSONNEL.

Our future success will depend to a significant extent on our ability
to attract, retain and motivate highly skilled scientists and sales personnel.
We presently have nine full-time employees of which one is a scientist, and have
seven consulting scientists. Our ability to maintain, expand or renew existing
engagements with our customers, enter into new engagements and provide
additional services to our existing customers depends, in large part, on our
ability to hire and retain scientists with the skills necessary to keep pace
with continuing changes in technology and sales personnel who are highly
motivated. Our officers and employees are "at will" which means that they may
resign at any time, and we may dismiss them at any time. We believe that there
is a shortage of, and significant competition for, scientists with the skills
and experience in the sciences necessary to perform the services we offer. We
compete with other contract research companies and academic institutions for new
personnel. In addition, our inability to hire additional qualified personnel may
require an increase in the workload for both existing and new personnel. We may
not be successful in attracting new scientists or sales personnel or in
retaining or motivating our existing personnel.

THE INTELLECTUAL PROPERTY RIGHTS WE RELY ON TO PROTECT THE TECHNOLOGY UNDERLYING
OUR PRODUCTS AND TECHNIQUES MAY NOT BE ADEQUATE, WHICH COULD ENABLE THIRD
PARTIES TO USE OUR TECHNOLOGY OR VERY SIMILAR TECHNOLOGY AND COULD REDUCE OUR
ABILITY TO COMPETE IN THE MARKET.

Our success will depend on our ability to obtain, protect and enforce
patents on our technology and to protect our trade secrets. We also depend, in
part, on patent rights licensed to us from third parties. Any patents we own or
license may not afford meaningful protection for our technology and products.
Others may challenge our patents or the patents of our licensors and, as a
result, these patents could be narrowed, invalidated or rendered unenforceable.
In addition, current and future patent applications on which we depend may not
result in the issuance of patents in the United States or foreign countries.
Competitors may develop products similar to ours which are not covered by our
patents. Further, since there is a substantial backlog of patent applications at
the U.S. Patent and Trademark Office, the approval or rejection of our or our
competitors' patent applications may take several years.

In addition to patent protection, we also rely on copyright protection,
trade secrets, know-how, continuing technological innovation and licensing
opportunities. In an effort to maintain the confidentiality and ownership of our
trade secrets and proprietary information, we require our employees, consultants
and advisors to execute confidentiality and proprietary information agreements.
However, these agreements may not provide us with adequate protection against
improper use or disclosure of confidential information and there may not be
adequate remedies in the event of unauthorized use or disclosure. Furthermore,
like many technology companies, we may from time to time hire scientific
personnel formerly employed by other companies involved in one or more areas
similar to the activities conducted by us. In some situations, our
confidentiality and proprietary information agreements may conflict with, or be
subject to, the rights of third parties with whom our employees, consultants, or
advisors have prior employment or consulting relationships. Although we will
require our employees and consultants to maintain the confidentiality of all
confidential information of previous employers, we or these individuals may be
subject to allegations of trade secret misappropriation or other similar claims
as a result of their prior affiliations. Finally, others may independently
develop substantially equivalent proprietary information and techniques, or
otherwise gain access to our trade secrets. Our failure to protect our
proprietary information and techniques may inhibit or limit our ability to
exclude certain competitors from the market.

THE RESEARCH INDUSTRY HAS A HISTORY OF INTELLECTUAL PROPERTY LITIGATION AND WE
MAY BE INVOLVED IN INTELLECTUAL PROPERTY LAWSUITS, WHICH MAY BE EXPENSIVE.

The research industry has a history of patent and other intellectual
property litigation and will likely continue to have patent lawsuits concerning
new technologies. In order to protect or enforce our patent rights, we may have
to initiate legal proceedings against third parties. In addition, we may be sued
by others for infringing their intellectual property rights or we may find it
necessary to initiate a lawsuit seeking a declaration from a court that we do
not infringe on the proprietary rights of others. The patent positions of other
companies are generally uncertain and involve complex legal and factual
questions. No consistent policy has emerged from the U.S. Patent and Trademark
Office or the courts regarding the breadth of claims allowed or the degree of
protection afforded under patents like those we own. Legal proceedings relating
to intellectual property would be expensive, take significant time and divert
management's attention

9
<PAGE>

from other business concerns, no matter whether we win or lose. The cost of such
litigation could affect our profitability.

Further, if we do not prevail in an infringement lawsuit brought
against us, in addition to any damages we might have to pay, we could be
required to stop the infringing activity or obtain a license. Any required
license may not be available to us on acceptable terms, or at all. In addition,
some licenses may be nonexclusive, and therefore, our competitors may have
access to the same technology licensed to us. If we fail to obtain a required
license or are unable to design around a patent, we may not be able to sell some
of our products or services.

WE MAY BE SUBJECT TO LIABILITY REGARDING HAZARDOUS MATERIALS.

Our products and services as well as our research and development
processes involve the controlled use of hazardous materials. We are subject to
federal, state and local laws and regulations governing the use, manufacture,
storage, handling and disposal of such materials and certain waste products. The
risk of accidental contamination or injury from these materials cannot be
completely eliminated. In the event of such an accident, we could be held liable
for any damages that result, and any such liability could exceed our resources
and disrupt our business. In addition, we may have to incur significant costs to
comply with environmental laws and regulations related to the handling or
disposal of such materials or waste products in the future, which would require
us to spend substantial amounts of money.

INDEMNIFICATION.

The Company's Certificate of Incorporation limits the liability of its
directors an officers to the Company and its shareholders to the fullest extent
permitted by Nevada law, and provides for indemnification of the directors and
offices to such extent. See "Management-Limited Liability and Indemnification".
The Company may also obtain liability insurance. These measures will provide
additional protection to the directors and officers of the Company against
liability in connection with certain actions and omissions.

CONFLICTS OF INTEREST.

There are anticipated conflicts of interest between the Company and its
stockholders, and there may be potential conflicts of interest involving the
Company and its stockholders, some of which may affect the planned business
activities of the Company. The Board of Directors will attempt to resolve any
conflict of interest situation which may arise and which is brought to the
attention of the Board of Directors on a case-by-case basis. See "Conflicts of
Interest".

NON-ARM'S LENGTH TRANSACTIONS.

The Company may engage in transactions with its officers, directors and
shareholders. Such transactions may be considered as not having occurred at
arm's length. The Company may do business with such persons in the future, but
intends to contract with them on the same basis and upon no more favorable terms
than could be obtained from persons not affiliated with the Company.

COMPLIANCE WITH FEDERAL AND STATE SECURITIES LAWS.

The Company has sold and may offer and sell its securities in the
future, and may sponsor or act as general partner or otherwise with regard to
registered or other unregistered offerings of securities. The securities have
been and may be offered and sold in reliance upon exemptions available pursuant
to the Securities Act of 1933, as amended. There can be no assurance that such
offerings will qualify under such exemptive provisions due to, among other
things, the adequacy of disclosure and the manner of distribution of the
offering, similar offerings conducted by the Company or its affiliates in the
future or the retroactive change in any securities laws or regulations. If, and
to the extent suits for rescission are brought against the Company and
successfully concluded for failure to register other offerings made by the
Company under the Securities Act of 1933, or for acts or omissions constituting
certain prohibited practices under the Securities Exchange ct of 1934, both the
capital and assets of the Company could be adversely affected, thus jeopardizing
the ability of the Company to operate successfully. A similar risk exists as a
result of the application of state securities laws of those states in which
Shares are offered or sold. Furthermore, the time and capital of the

10
<PAGE>

Company could be expended on defending an action by investors or by state or
federal securities commission even if the Company is ultimately exonerated.

PRODUCT LIABILITY AND WARRANTY CLAIMS.

The Company has never had a significant claim brought against it for
product liability. While the Company has never incurred significant liability
for such claims, any significant occurrence in claims could have an adverse
impact on the Company. The Company believes that its product liability insurance
will be adequate and that it also may have certain rights to indemnification
from third parties. There can, however, be no assurance that claims exceeding
such coverage will not be made, that the Company will be able to obtain and
continue insurance coverage or that the Company would be successful in obtaining
indemnification from such third parties. Although the Company from time to time
will provide written limited warranties to its customers, no significant
warranty claims have been received or are expected. There can, however, be no
assurance that significant warranty claims will not be received in the future.

RISKS RELATED TO THIS OFFERING

OUR STOCK PRICE LIKELY WILL BE HIGHLY VOLATILE, AND YOUR INVESTMENT COULD
DECLINE IN VALUE.

The trading price of our Common Stock has been and will be highly
volatile and could be subject to wide fluctuations in price in response to
various factors, many of which are beyond our control, including:

- actual or anticipated variations in quarterly operating results;

- announcements of technological innovations by us or our
competitors;

- new products or services introduced or announced by us or our
competitors;

- changes in financial estimates by securities analysts;

- announcements by us or our competitors of significant
acquisitions, strategic partnerships, joint ventures or capital
commitments;

- additions or departures of key personnel;

- economic and political factors; and

- sales of our Common Stock.

In addition, the stock market in general, the over-the-counter market
and the market for technology companies in particular, have been unrelated or
disproportionate to the operating performance of those companies. These broad
market and industry factors may seriously harm the market price of our Common
Stock, regardless of our operating performance. In the past, following periods
of volatility in the market price of a company's securities results in
litigating, and a class action suit against us could result in potential
liabilities, substantial costs and the diversion of management's attention and
resources, regardless of whether we win or lose.

WE MAY INVEST OR SPEND THE PROCEEDS OF THIS OFFERING IN WAYS WITH WHICH YOU MAY
NOT AGREE.

We have not yet determined the specific allocation of the proceeds from
this offering, and we will retain broad discretion over the use of the proceeds.
You may not agree with how we spend the proceeds, and our use of the proceeds
may not yield a significant return or any return at all. For example, we may use
the proceeds to acquire new businesses or technologies which are unproven and
may not ultimately generate revenue for us.

<PAGE>

OUR EXECUTIVE OFFICERS, DIRECTORS AND PRINCIPAL STOCKHOLDERS OWN A LARGE
PERCENTAGE OF OUR VOTING STOCK AND COULD DELAY OR PREVENT A CHANGE IN OUR
CORPORATE CONTROL OR OTHER MATTERS REQUIRING STOCKHOLDER APPROVAL, EVEN IF
FAVORED BY OUR OTHER STOCKHOLDERS.

Assuming the maximum number of shares in this offering are sold by the
Company, our executive officers, directors and principal stockholders, and their
respective affiliates, will beneficially own approximately % of our
outstanding Common Stock. These stockholders, if acting together, would be
able to control substantially all matters requiring approval by our
stockholders, including the election of all directors and approval of
significant corporate transactions.

FUTURE SALES OF OUR COMMON STOCK MAY DEPRESS OUR STOCK PRICE.

The market price of our Common Stock could decline as a result of sales
of substantial amounts of our Common Stock in the public market during and after
the closing of this offering, or the perception that these sales could occur. In
addition, these factors could make it more difficult for us to raise funds
through future offerings of Common Stock. There will be 50,969,304 shares of
Common Stock outstanding immediately after this offering, assuming all of the
shares offered by this Prospectus are sold. All of the shares sold in the
offering will be freely transferable without restriction or further registration
under the Securities Act, except for any shares purchased by our "affiliates",
as defined in Rule 144 of the Securities Act. There are 5,515,005 shares of
Common Stock presently outstanding as "restricted securities" as defined in Rule
144 which will be available for sale in the future. These shares may be sold in
the future without registration under the Securities Act to the extent permitted
by Rule 144 or other exemptions under the Securities Act.

In the future, we intend to register approximately 2,000,000
additional shares of Common Stock which will be reserved for issuance upon
exercise of options or stock bonuses to be granted or reserved for grant under
our 2000 stock option and stock bonus plan. Once we register these shares,
they can be sold in the public market upon issuance, subject to restrictions
under the securities laws applicable to resales by affiliates.

<PAGE>

BECAUSE IT IS UNLIKELY THAT WE WILL PAY DIVIDENDS, YOU WILL ONLY BE ABLE TO
BENEFIT FROM HOLDING OUR STOCK IF THE STOCK PRICE APPRECIATES.

We have never paid cash dividends on our capital stock and do not
anticipate paying any cash dividends in the foreseeable future.

ABSENCE OF INDEPENDENT UNDERWRITERS-INDEMNIFICATION.

Under federal securities laws, underwriters of securities offered to
the public may be expected to take such steps as may be necessary to ensure that
the information contained in the offering documents is accurate and complete.
These steps are typically taken by a "lead underwriter" or "dealer manager" who
participates in the preparation of the offering documents. Since there is no
underwriter in this offering investors must rely on the Company regarding the
information contained in this Prospectus. See "Plan of Distribution".

APPLICABILITY OF "PENNY STOCK RULES".

Federal regulations under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), regulate the trading of so-called "penny stocks"
(the "Penny Stock Rules"), which are generally defined as any security listed on
a national securities exchange or Nasdaq, priced at less than $5.00 per share
and offered by an issuer with limited net tangible assets and revenues. In
addition, equity securities listed on Nasdaq which are priced at less than $5.00
per share are deemed penny stocks for the limited purpose of Section 15(b)(6) of
the Exchange Act which makes it unlawful for any broker-dealer to participate in
a distribution of any penny stock without the consent of the Securities and
Exchange Commission if, in the exercise of reasonable care, the broker-dealer is
aware of or should have been aware of the participation of previously sanctioned
person. Therefore, if, during the time in which the Common Stock is publicly
traded, the Common Stock is priced below $5.00 per share, trading of the Common
Stock will be subject to the provisions of Section 15(b)(6) of the Exchange Act.
In such event, it may be more difficult for the broker-dealer to sell the Common
Stock and purchasers of the Shares offered hereby may have difficulty in selling
their Shares in the future in the secondary market.

While the Company's Common Stock is traded in the future in the
over-the-counter market, and the Company fails other relevant criteria,
resulting in the Common Stock being considered penny stock, trading in the
Common Stock would be subject to the full range of Penny Stock Rules.
Accordingly, the application of the comprehensive Penny Stock Rules may make it
more difficult for broker-dealers to sell the Company's Common Stock and
purchasers of the Shares offered hereby may have difficulty in selling their
Shares in the future in the secondary trading market.

NOTE: IN ADDITION TO SUCH RISKS, BUSINESSES ARE OFTEN SUBJECT TO RISKS
NOT FORESEEN OR FULLY APPRECIATED BY MANAGEMENT. IN REVIEWING THIS PROSPECTUS,
POTENTIAL INVESTORS SHOULD KEEP IN MIND THAT OTHER POSSIBLE RISKS MAY EXIST.

FORWARD-LOOKING STATEMENTS

This Prospectus contains forward-looking statements. These
forward-looking statements are not historical facts but rather are based on
current expectations, estimates and projections about our industry, our beliefs
and our assumptions. Words such as "anticipates", "intends", "plans", "will",
"believes", "seeks", and "estimates", and

13
<PAGE>

variations of these words and similar expressions, are intended to identify
forward-looking statements. These statements are not guarantees of future
performance and are subject to risks, uncertainties and other factors, some of
which are beyond our control, are difficult to predict and could cause actual
results to differ materially from those expressed, implied or forecasted in the
forward-looking statements. In addition, the forward-looking events discussed in
this Prospectus might not occur. These risks and uncertainties include, among
others, those described in "Risk Factors" and elsewhere in this Prospectus. You
are cautioned not to place under reliance on these forward-looking statements,
which reflect our management's view only as of the date of this Prospectus.
Except as required by law, we undertake no obligation to update any
forward-looking statement, whether as a result of new information, future events
or otherwise.

USE OF PROCEEDS

The Company will not receive any of the proceeds from the sale of the
Common Stock by the Selling Stockholders. However, we estimate that the net
proceeds from the sale of our shares of Common Stock to the Selling
Stockholders will be approximately $16,823,397 before deducting the estimated
offering expenses of approximately $100,000. The proceeds to the Selling
Stockholders may vary due to changes in the market price of the Common Stock of
the Company.

We currently intend to use the net proceeds to fund our operations,
including continued research and development of existing products as well as
research and development of additional products and services. The Company
expects to issue 2,000,000 shares of its Common Stock in this offering regarding
the conversion of its $1,000,000 of outstanding Series A Convertible Notes into
Common Stock of the Company. We also may use a portion of the net proceeds to
acquire other businesses or technologies, hire additional personnel and expand
our facilities to be able to meet the growing needs of our business. Although we
have no current plans, agreements or commitments with respect to any
acquisition, we may, if the opportunity arises, use an unspecified portion of
the net proceeds to acquire or invest in products, technologies or other
companies. We intend to use the balance of the net proceeds for general
corporate purposes, including working capital. Our management may spend the
proceeds from this offering in ways which the stockholders may not deem
desirable.

The timing and amount of our actual expenditures will be based on many
factors, including cash flows from operations and the growth of our business.

Until we use the net proceeds of this offering for the above purposes,
we intend to invest the funds in short-term, investment-grade, interest-bearing
securities. We cannot predict whether the proceeds invested will yield a
favorable return.

DIVIDEND POLICY

We have never declared or paid any cash dividends on our Common Stock.
We currently intend to retain any earnings to support operations and to finance
the growth and development of our business. Therefore, we do not expect to pay
cash dividends in the foreseeable future. Any future determination relating to
our dividend policy will be made at the discretion of our board of directors and
will depend on a number of factors, including future earnings, capital
requirements, financial conditions and future prospect and other factors that
the board of directors may deem relevant.

PRICE RANGE OF COMMON STOCK

GENERAL

The Common Stock is traded on the Electronic Bulletin Board
over-the-counter market, and is quoted under the symbol PWTC.

MARKET PRICE

When the trading price of the Company's Common Stock is below $5.00 per
share, the Common Stock is considered to be "penny stocks" that are subject to
rules promulgated by the Securities and Exchange Commission (Rule 15-1 through
15g-9) under the Securities Exchange Act of 1934. These rules impose significant
requirements on brokers under these circumstances, including: (a) delivering to
customers the Commission's standardized risk disclosure document; (b) providing
to customers current bid and offers; (c) disclosing to customers the
brokers-dealer and sales

14
<PAGE>

representatives compensation; and (d) providing to customers monthly account
statements.

The following table sets forth the range of high and low sale prices
per share of the Common Stock of the Company as reported by National Quotation
Bureau, L.L.C. for the periods indicated. Prior to September 1997, there was no
public market for the trading of the Common Stock of the Company.

YEAR ENDED DECEMBER 31, 1997 HIGH BID(1)(2) LOW BID(1)(2)
---------------------------- -------------- ------------
<S> <C> <C>
4th Quarter.............................................. $ 3.125 $ .50

YEAR ENDED DECEMBER 31, 1998
----------------------------

1st Quarter (1)......................................... $ 3.4375 $ 3.025
2nd Quarter............................................. $ 5.25 $ 1.625
3rd Quarter............................................. $ 2.50 $ .625
4th Quarter............................................. $ .83 $ .25

YEAR ENDED DECEMBER 31, 1999
----------------------------

1st Quarter............................................. $ .75 $ .25
2nd Quarter............................................. $ 2.375 $ .45
3rd Quarter............................................. $ .86 $ .375
4th Quarter............................................. $ .82 $ .34375

YEAR ENDING DECEMBER 31, 2000
-----------------------------

1st Quarter............................................. $ 1.84375 $ .40
2nd Quarter............................................. $ 1.65625 $ .53125
3rd Quarter............................................. $ 1.40625 $ .625
</TABLE>

(1) During March 1998, the Company effectuated a one for five (1:5) reverse
stock split. The above prices have been revised to reflect this split.

(2) The Company is unaware of the factors which resulted in the significant
fluctuations in the prices per share during the periods being presented although
it is aware that there is a thin market for the Common Stock, that there are
frequently few shares being traded and that any sales activity significantly
impacts the market.

The closing price of the Common Stock of the Company on November 9, 2000, was
$.812 per share.

DIVIDENDS

The Company has not paid any dividends on its Common Stock and does not
expect to do so in the foreseeable future. The Company intends to apply its
earnings, if any, in expanding its operations and related activities.

The payment of cash dividends in the future will be at the discretion
of the Board of Directors and will depend

15
<PAGE>

upon such factors as earnings levels, capital requirements, the Company's
financial condition and other factors deemed relevant by the Board of Directors.
In addition, the Company's ability to pay dividends may become limited under
future loan agreements of the Company which may restrict or prohibit the payment
of dividends.

CAPITALIZATION

The following table sets forth the following information:

- our actual capitalization as of July 31, 2000 (unaudited);

- our pro forma capitalization as adjusted to reflect the receipt
of net proceeds from our sale of 30,859,999 shares of Common
Stock to the Selling Stockholders and the conversion of their
Series A Convertible Notes, less the estimated offering expenses.

<TABLE>
<CAPTION>
July 31, 2000
---------------------------
Pro Forma
Actual As Adjusted
----------- -----------
<S> <C> <C>
Long-term obligations, less current portion $ 0 $ 0

Stockholders' equity:

Common Stock, $0.001 par value; 25,000,000 shares authorized at
July 31, 2000;

Issued and outstanding Common Stock, actual; 17,664,000 shares.................... $ 17,664 -----

Shares of Common Stock issued and outstanding, pro forma as adjusted;
50,969,304........................................................................ $ ----- $ 50,969

Preferred Stock, $.01 par value; 1,000,000 shares to be authorized; none issued $ ----- -----

Additional paid-in capital........................................................ $ 2,062,362 18,781,932

Accumulated deficit............................................................... $(2,563,038) $(2,563,038)

Total stockholders' equity ....................................................... $ (483,012) $16,218,894

</TABLE>

The number of shares of Common Stock referenced above excludes as of
September 30, 2000:

- 2,380,000 shares of Common Stock issuable upon exercise of
outstanding options at a weighted average exercise price of $.57
per share.

- 2,000,000 additional shares of Common Stock recently approved
for issuance under its 2000 stock option and stock bonus plan.
No options or stock bonuses have been granted under this plan
as of September 30, 2000.

16
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN AND OPERATION

The following discussion is intended to assist in an understanding of
the Company's consolidated financial position for its fiscal years ended January
31, 1998, 1999 and 2000 and for the six month periods ended July 31, 1999 and
2000, and the results of its operations for the periods then ended.

You should read the following discussion and analysis of financial
condition and results of operations of the Company together with the financial
statements and notes to the consolidated financial statements which appear
elsewhere in this Prospectus. This discussion contains forward-looking
statements that involve risks and uncertainties. As a result of many factors,
such as those set forth under "Risk Factors" and elsewhere in this Prospectus,
our actual

17
<PAGE>

results may differ materially from those anticipated in these forward-looking
statements.

GENERAL

Power Technology, Inc. (the "Company"), a Nevada corporation, was
incorporated on June 3, 1996.

The Company is in the development stage of developing its batteries
and other products. The Company is in the process of building its initial
prototypes of its batteries, but has not commenced any commercial production or
sales of batteries, pipeline connection equipment, alloy sensors or grain drying
equipment.

Historically, the Company has used capital contributions from various
stockholders to fund its operations. To this point, the Company has not had
adequate funds to commercially produce, market and sell its batteries, pipeline
connection equipment and alloy sensors.

There are no assurances that the Company will be able to obtain a
profitable level of operations.

SIX MONTHS ENDED JULY 31, 2000, COMPARED WITH SIX MONTHS ENDED JULY 31, 1999

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JULY 31
---------------------------
2000 1999
----------- ------------
(unaudited) (unaudited)
<S> <C> <C>
Revenues.............................................. $ 0 $ 0
General and administrative expenses................... 594,204 251,294
Research and Development.............................. 188,169 53,324
----------- ------------
Net income (loss)..................................... $ (782,373) $ (304,618)
Net income (loss) per share........................... $ (.04) $ (.04)
</TABLE>

REVENUES.

The Company had no revenues during the first six months of 2000 and
1999, and is in the development stage.

GENERAL AND ADMINISTRATIVE EXPENSES.

General and administrative expenses increased approximately 236% to
$594,204 in the six month period ended July 31, 2000, from $251,294 in 1999.
This increase is principally attributable to increased activity by the
consultants to the Company.

RESEARCH AND DEVELOPMENT COSTS.

Research and development costs increased approximately 353% during the
first six months of fiscal 2000 to $188,373 compared to the first six months of
1999 from $53,324.

RESULTS OF OPERATIONS.

The net loss of the Company increased to $782,373 during the six month
period ended July 31, 2000, as compared with a loss of $304,618 during the same
period of 1999, an increase of approximately 257%, and was due primarily to the
increase in general and administrative expenses, its research and development
activities and lack of revenues.

18
<PAGE>

YEAR ENDED DECEMBER 31, 2000 COMPARED TO 1999

The following table sets forth certain operating information regarding
the Company:

Year Ended Year Ended
January 31, 2000 January 31, 1999
---------------- ----------------
<S> <C> <C>
Revenues $ 0 $ 0
General and adminis-
trative expense $ 803,311 $ 515,588
Research and
development $ 105,164 $ 166,936
Interest expense $ $ (16,916)
Net Loss $(908,475) $(700,909)
Net Loss Per Share $ (.05) (.07)

</TABLE>

REVENUES.

Total revenues for fiscal years 2000 and 1999 were $0, as the
operations of the Company continued to be focused on research and development.
To date, the Company has not established any commercial products nor commenced
any commercial production operations.

GENERAL AND ADMINISTRATIVE EXPENSES.

General and administrative expenses increased from $515,588 in fiscal
year 1999 to $803,311 during the fiscal year ended January 31, 2000, an
increase of approximately 55.8%. The principal reason for the increase was the
issuance of common stock of the Company in exchange for consulting services,
the value of the stock ($329,001) being charged to administrative expense,
compared to $134,799 being charged during fiscal 1999.

RESEARCH AND DEVELOPMENT EXPENSES.

Research and development expenses decreased from $166,936 in fiscal
year 1999 to $105,164 during the fiscal year ended January 31, 2000, a
decrease of approximately 37%, as a result of decreased research activities
regarding the Company's battery development.

INTEREST EXPENSE.

Interest expense decreased from $16,916 in fiscal 1999 to $0 during
the fiscal year ended January 31, 2000, because stockholder indebtedness,
including interest, was exchanged for common stock during the fiscal year.

NET LOSS.

The net loss of the Company increased from $700,909 during fiscal
year 1999 compared to a net loss of $908,475 during the fiscal year ended
January 31, 2000, an increase of approximately 29.6%. The increase in the net
loss of the Company is attributable primarily to an increase in general and
administrative expenses of the Company during the fiscal year ended January
31, 2000, and its continued lack of revenues.

CAPITAL RESOURCES.

The Company's capital resources have been provided primarily by
capital contributions and loans from its stockholders. The Company raised
$690,000 in capital during fiscal 1999 through a limited offering of its
Common Stock and warrants which have been used to purchase additional
equipment, to further develop its products, to establish its marketing
activities, and to provide additional working capital to fund operations. The
Company did not conduct any securities offerings during the fiscal year ended
January 31, 2000; however, $258,500 in stockholder debt and

<PAGE>

interest was exchange for 1,034,000 shares of Common Stock and $40,000 was
realized through the exercise of a stock option by a consultant to the Company.

WORKING CAPITAL AND LIQUIDITY.

At January 31, 2000, the Company had negative working capital of
approximately $207,220 compared to January 31, 1999, in the amount of $128,647
The Company believes that it will be necessary to increase it working capital
to continue its research and development activities which may be achieved by
incurring additional indebtedness from stockholders or others (see Note 6) or
by the sale of Common Stock or other securities of the Company.

The ability of the Company to satisfy its obligations will depend in
part upon its ability to successfully complete the offer and sale of
additional shares of its Common Stock and in part upon its ability to reach a
profitable level of operations.

On April 17, 2000, we entered into an Investment Agreement with the
Swartz Private Equity, L.L.C. ("Swartz") to raise up to $35,000,000 through a
series of sales of Common Stock. The dollar amount of each sale is limited by
the trading volume and he total number of issued and outstanding shares of
Common Stock of the Company. In order to sell shares to the Swartz there must
be an effective registration statement on file with the SEC covering the
resale of the shares by the Swartz and we must meet certain other conditions.

<PAGE>

YEAR ENDED JANUARY 31, 1999, COMPARED TO 1998

The following table sets forth certain operating information on the
Company:

<TABLE>
<CAPTION>
Year Ended Year Ended
January 31, 1999 January 31, 1998
---------------- ----------------
<S> <C> <C>
Revenues $ 0 $ 0
General and adminis- $ 515,588 $ 51,374
trative expense
Net Loss $(700,909) $ (51,574)
Net Loss Per Share $ (.07) $ (.02)
</TABLE>

REVENUES.

Total revenues for fiscal years 1999 and 1998 were $0, as the
operations of the Company continued to be focused on research and development.
To date, the Company has not established any commercial products nor commenced
any commercial production operations.

GENERAL AND ADMINISTRATIVE EXPENSES.

General and administrative expenses increased from $51,374 in fiscal
year 1998 to $515,588 during the fiscal year ended January 31, 1999, an
increase of approximately 1,003%. The principal reason for the increase was
the issuance of Common Stock of the Company in exchange for consulting
services, the value of the stock being charged to administrative expense.

RESEARCH AND DEVELOPMENT EXPENSES.

Research and development expenses decreased from $166,936 in fiscal
year 1999 to $105,164 during the fiscal year ended January 31, 2000, a decrease
of approximately 37%, as a result of decreased research activities regarding the
Company's battery development.

INTEREST EXPENSE.

Interest expense decreased from $16,916 in fiscal 1999 to $0 during the
fiscal year ended January 31, 2000, because stockholder indebtedness, including
interest, was exchanged for common stock during the fiscal year.

NET LOSS.

The net loss of the Company increased from $51,574 during fiscal year
1998 compared to a net loss of $700,909 during the fiscal year ended January
31, 1999, an increase of approximately 1,359%. The increase in the net loss of
the Company is attributable primarily to an increase in general and
administrative expenses of the Company during the fiscal year ended January
31, 1999, and its continued lack of revenues.

PLAN OF OPERATIONS

Because of the costs of development of its battery systems and other
products, and the continuing costs of its battery prototype production, the
Company expects that it will incur a loss during its fiscal year ending
January 31, 2001.

The Company believes that additional equity capital will be required
to accomplish its plan of operations during the next 12 months. As a result,
the Company is offering to sell its Common Stock to further capitalize the
Company, and may also borrow from banks and others to the extent necessary to
provide liquidity for its operations, although no arrangements for any
additional borrowings have been made.

The Company has maintained its research and development activities
and the associated costs consistent with its plan of operations in order to
develop its batteries and other products for proposed commercial production.
However, the Company expects to continue the development of its batteries and
other products to incorporate technical changes and improvements. In addition,
as the Company establishes its marketing activities, the Company will incur
additional operating and equipments costs.

The Company's plan of operations provides for an expansion of its
battery business, and research and development regarding its other products.
The scope of this expansion is dependent upon the amount of additional
capitalization to be realized by the Company in its present securities
offering, the amount of credit lines that may become available to finance such
activities, and its ability to enter into agreements with licensees, joint
venture partners, and others. To the extent that the operations of the Company
substantially increase, it will be necessary to make significant changes in
the number of additional employees of the Company.

FORWARD LOOKING STATEMENTS

When used in the Prospectus and in our other filings with the SEC, in
our press releases and in oral statements made with the approval of one of our
authorized executive officers, the works or phrases "will likely result",
"plans", "will continue", "is anticipated", "estimated", "expect", "project"
or "outlook" or similar expressions (including confirmations by one of our
authorized executive officers of any such expressions made by a third party
with respect to us) are intended to identify "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. We
caution readers not to place undue reliance on any such statements, each of
which speaks only as of the date made. Such statements are subject to certain
risks and uncertainties, including but not limited to our history of losses,
our limited operating history, our need for additional financing, rapid
technological change, and an evolving and uncertain market for on-line
commerce, that could cause actual results to differ materially from historical

<PAGE>

earnings and those presently anticipated or projected. Factors that may cause
actual results to differ materially from those contemplated by such
forward-looking statements include, among others, the factors described in the
Risk Factors section of this Prospectus. We undertake no obligation to release
publicly revisions we made to any forward-looking statements to reflect events
or circumstances occurring after the date of such statements. All written and
oral forward-looking statements made after the date of this Prospectus and
attributable to us or persons acting on our behalf are expressly qualified in
their entirety by this discussion.

UNCERTAINTIES:

DEVELOPMENT STAGE COMPANY.

The Company is in the development stage. There is no assurance that
te Company's activities will be profitable. The likelihood of the success of
the Company must also be considered in light of the problems, expenses,
difficulties, complications, delays and all of the inherent risks frequently
encountered in the formation and operation of a relatively new business.

COSTS OF CONDUCTING BUSINESS.

The Company will be required to incur substantial costs for research
and development and equipment, establishing production and marketing
operations, and related costs. A substantial portion of those costs must be
paid whether or not any of its batteries or other products prove to be
commercially successful on a broad scale. The ability to generate a profit
depends, among other factors, on the amount of equipment acquisition costs
incurred, the amount of revenues from the sale of batteries and other products
by the Company, and its operating costs.

COMPETITION.

The battery business is highly competitive. Companies in the industry
have substantially greater financial, marketing, and technical resources than
the Company. Further, the entry into this industry does not necessarily
require a large capital expenditure and, accordingly, it can be expected that
additional competitors may enter the industry in the future. It may be
particularly difficult for a relatively small independent company to compete
with larger companies which have significantly greater resources. There can be
no assurance that the Company will be able to successfully compete if such an
environment develops.

TECHNOLOGICAL CHANGE.

The Company expects that many new technologies and products will be
introduced in the battery industry over the next several years. The Company's
success will depend, among other things, on its ability to develop maintain a
competitive position technologically. There can be no assurance that the
Company will have access to subsequently developed technology by other
persons. Technological advances by a competitor may result in the Company's
present or future products becoming noncompetitive or obsolete. The Company
cannot be assured that competitors will not develop functionally similar or
superior batteries, which event could have an adverse effect on the Company's
business.

CONTRACTS.

The Company has no current contracts for the manufacture or sale of
its batteries or other products, and has no back-log. There can be no
assurance that the Company will be able to obtain sufficient and suitable
contracts for its business plan.

FLUCTUATIONS IN OPERATING RESULTS.

The Company's revenues and results of operations may vary
significantly in the future. The Company's revenues and results of operations
are difficult to forecast and could be materially adversely affected by many
factors, some of which are outside the control of the Company, including,
among others, the expected relatively long sales and implementation cycles for
the Company's products; the size and timing of individual license transactions
and joint

<PAGE>

venture arrangements; seasonality of revenues; changes in the Company's
operating expenses; changes in the mix of products sold; timing of
introduction or enhancement of products by the Company or its competitors;
market acceptance of new products; technological changes in technology;
personnel changes and difficulties in attracting and retaining qualified
sales, marketing, technical and consulting personnel; changes in customers'
budgeting cycles; quality control of products sold; and economic conditions
generally and in specific industry segments, particularly the automotive
industry.

There can be no assurance that the Company's products will achieve
broad market acceptance or that the Company will be successful in marketing
its products or enhancements thereto. In the event that the Company's current
or future competitors release new products that have more advanced features,
offer better performance or are more price competitive than the Company's
products, demand for the Company's products would decline. A decline in demand
for, or market acceptance of, the Company's batteries or other products as a
result of competition, technological change, or other factors would have a
material adverse effect on the Company's business, financial condition or
results of operations.

MANAGEMENT OF EXPANDING OPERATIONS.

The Company's business may grow rapidly. In addition, the Company may
experience significant growth in the number of its employees, the scope of its
operating and financial systems and the geographic area of its operations,
which will place a significant strain on the Company's management. The
Company's future results of operations will depend in part on the ability of
its officers and other key employees to continue to implement and expand its
operational, customer support and financial control systems and to expand,
train and manage its employee base. In order to successfully manage its future
growth, if any, the Company will be required to hire additional general and
administrative personnel and to augment its existing financial and management
systems or to implement new such systems. There can be no assurance that the
existing and new management will be able to augment or to implement such
systems efficiently or on a timely basis, and the failure to do so could have
a material adverse effect on the Company's business, financial condition or
results of operations. There can be no assurance that the Company will be able
to manage any future expansion successfully, and any inability to do so would
have a material adverse effect on the Company's business, financial condition
or results of operations. In addition, the Company believes that its future
success will also depend to a significant extent upon its ability to attract,
train and retain highly skilled technical, management, sales, marketing and
consulting personnel. Competition for such personnel is intense, and the
Company expects that such competition will continue for the foreseeable
future. There can be no assurance that the Company will be successful in
attracting or retaining such personnel, and the failure to attract or retain
such personnel could have a material adverse effect on the Company's business,
financial condition or results of operations.

RAW MATERIALS

The basic raw materials and components for the batteries and other
products being developed by the Company are readily available. The Company
does not expect to experience any material delays in obtaining timely delivery
of its materials and components.

SEASONALITY

The Company does not expect to experience material seasonal
variations in revenues or operating costs, except that sales activity for its
batteries may increase in the summer and winter seasons which is expected to
cause the operations of the Company to increase during such periods.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Short-term investments. Our future interest income will be sensitive
to changes in the general level of U.S. interest rates, particularly since a
significant portion our investments are and will be in short-term marketable
securities. Due to the nature and maturity of our short-term investments, we
have concluded that there is no material market risk exposure.

<PAGE>

Inflation. We do not believe that inflation has had a material
impact o our business or operating results during the periods presented.

RECENT ACCOUNT AND PRONOUNCEMENTS

SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities, will be effective January 1, 2001. This statement establishes
accounting and reporting standards requiring that every derivative instrument,
including certain derivative instruments imbedded in other contracts, be
recorded in the balance sheet as either an asset or liability measured at its
fair value. The statement also requires that changes in the derivative's fair
value be recognized in earnings unless specific hedge accounting criteria are
met. We believe the adoption of SFAS No. 133 will not have an effect on the
financial statements because we do not engage in derivative or hedging
activities.

In December 1999, the Securities and Exchange Commission released
Staff Accounting Bulletin No. 101, Revenue Recognition in Financial
Statements, which provides guidance on the recognition, presentation and
disclosure of revenue in material impact on our financial statements.

<PAGE>

PART I

BUSINESS

DESCRIPTION OF BUSINESS.

Power Technology, Inc. (the "Company"), a Nevada corporation, was
incorporated on June 3, 1996. However, the Company did not conduct any
significant operations until March 1998 when it acquired all of the issued and
outstanding capital stock and assets of PowerTek Technology Corporation, Inc.
(formerly called Power Technology, Inc.) which is presently a wholly-owned
subsidiary of the Company. The Company changed its corporate name from
"Zepplin Production Corp." to Power Technology, Inc. during March 1998 to
reflect the change in the purposes and nature of its business.

BATTERIES

The primary business of the Company has been to develop advanced
technology for batteries to be used in the automotive and electric car
industry, and other uses. Its battery technology has recently passed from the
"proof of principle" stage to the "preliminary prototype" stage of development.

The goal of the Company has been the development of batteries that
(i) are substantially lighter than conventional car batteries, (ii) have a
high charge/quicker recharge rate, (iii) provide greater range, (iv) will be
more cost effective, and (v) will be more environmentally friendly.

Electric cars currently being produced have battery packs that last
between 25,000 and 30,00 miles, weight about 1,100 pounds, require a two to
eight hour recharge period using a 220-volt outlet (or six to ten hours using
a 110-volt outlet) and cost about $3,000 to $20,000 to replace. These
operating and recharge statistics only apply to electric cars or batteries
operating at room temperature. At higher temperatures, like those found on
sun-soaked asphalt highways (approximately 50% of North America), battery life
of conventional batteries is drastically diminished. At lower temperatures
(the other half of North America), there is power loss in conventional
batteries. Using today's state-of-the-art technology, the 1998 electric
vehicles will run on lead-acid batteries and carry two people about 50 miles
on a hot day. In order to meet the demands being placed on auto makers for
electric cars, management expects significant demand for an advanced battery
that: (1) has a quicker recharge rate; (2) is lighter weight with higher
energy density; (3) is more cost effective; and (4) carries a charge for
distances longer than two hundred miles in any temperature.

The strategy of the Company has been to develop automotive battery
products that have technological advantages over available alternatives and
that are capable of being produced commercially on an economically competitive
basis. The Company intends to continue its development efforts to be funded in
part through licensees and industrial joint venture partners in order to
broaden and build upon its products and technological base.

The Company recognizes the need to protect its technology and has a
patent pending covering its battery structure and materials.

The importance of electric vehicles in the Untied States and abroad
has increased because of concerns regarding air pollution, global climatic
changes, ozone layer depletion, noise abatement and dependence on imported
oil. However, because of the costs and limited range of currently available
batteries, the production and sales of electric vehicles has been very
limited. There appears to be substantial demand for a high power, durable,
high charge/discharge rate battery for electric cars and other hybrid electric
vehicles (such as two and three wheeled vehicles that are numerous in Europe
and third world countries) that are more cost effective, lighter and smaller.

The Company's future business prospects are substantially dependent
upon the ability of the Company, its joint

<PAGE>

venture partners and licensees to develop, manufacture and sell products based
on the Company's battery technologies. Additional development efforts will be
required before products based on the Company's technologies can be
manufactured and sold commercially. There can be no assurance that certain
products based on the Company's technologies can be manufactured cost
effectively on a commercial scale, that such products will gain market
acceptance or that competing products and technologies will not render
products based on the Company's technologies obsolete or noncompetitive.

In certain fields, the Company may enter into licensing or joint
venture agreements with established companies. Any revenues or profits which
may be derived by the Company from these arrangements will be substantially
dependent upon the willingness and ability of the Company's licensees and
joint venture partners to devote their financial resources and manufacturing
and marketing capabilities to commercialize products based on the Company's
technologies.

The Company's ability to compete effectively with other companies
will depend, in part, on its ability to protect and maintain the proprietary
nature of its technology. There can be no assurance that the Company's patents
or other proprietary rights will be determined to be valid or enforceable if
challenged in court or administrative proceedings or that the Company patents
or other proprietary rights, even if determined to be valid, will be broad
enough in scope to enable the Company to prevent third parties from producing
products using similar technologies or processes. There can also be no
assurance that the Company will not become involved in disputes with respect
to the patents or proprietary rights of third parties.

BATTERY TECHNOLOGY

The battery being developed by the Company is an electrochemical
battery of the type having a positive plate, a negative plate, an electrolyte
contacting and bridging the plates, and a transducer in contact with the
plate(s) to apply electronic energy to the plate(s). Each plate is comprised
of a rigid metal structure which significantly increases the exposed surface
area of the plates for the electrolyte to be in contact. The metal structure
of the plates are specially coated with an electrically conductive metal.

Electrochemical batteries typically include a pair of oppositely
charged plates (positive and negative) with electrolyte to convey ions from
one plate to the other when the circuit is completed. This is a well developed
technology, typically utilizing a lead-acid electrolyte which is more
expensive, more volatile, and environmentally unfavorable than the Company's
battery technology.

Because the capability of a battery is directly related to the
surface area of its plates which is in contact with electrolyte, their
capability is usually enhanced by sculpting their surfaces to increase and
open up their surface areas. The technology of the Company further increases
the surface areas of the plates without compromising their strength or
resistence to vibration, erosion and loss of material. Because the Company's
plates can be placed closer together due to their rigidity, the size of the
battery and the amount of required electrolyte is significantly reduced. For
this reason, it also increases the power density for both the weight and size
of the battery.

The physical movement of electrolyte at the interface of the plates
is increased which materially enhances the ion migration and transfer between
the plates. Stagnation of electrolyte at the plates of conventional batteries
is a problem because it inhibits the transfer and migration of ions between
the plates, commonly known as ion depletion.

Based upon these technologies, the batteries of the Company are
smaller and lighter weight and provide increased electrical charge/discharge,
higher power, durability, and environmental acceptability.

PROTOTYPE BATTERIES

The Company is in the process of producing preliminary prototype
versions of its battery that will be built and tested in a variety of
configurations. Preliminary testing by the Company indicates that various
configurations of the battery meet or exceed some of the performance goals
established by major governmental and industry groups for electric vehicle
batteries. The Company also believes its battery has a number of applications
other than electric vehicles, such as hybrid powered vehicles, portable power
tools, electric power management, uninterruptible power and
26
<PAGE>

for starting, lighting and ignition ("SLI") batteries for automobiles,
aircraft and marine craft. The Company is designing various prototype
batteries for such applications.

GLOSSARY OF TECHNICAL TERMS. Certain technical terms used herein
have the following meanings:

Cycle Life - the number of times a rechargeable battery can be
charged and discharged.

Electrode (battery) - the chemically active portions of a battery.

Energy Density - the amount of energy stored in a specific volume or
weight.

EV (Electric Vehicle) - a vehicle propelled exclusively by an electric
drive system powered by an electrochemical energy storage device,
typically a rechargeable battery.

HEV (Hybrid Electric Vehicle) - a vehicle that is propelled both by an
electrochemical energy storage device coupled to an electric drive and
an auxiliary power unit powered by a conventional fuel such as
reformulated gasoline, direct injection diesel or compressed natural
gas.

Hydrides - solid materials that store hydrogen.

Power Density - the amount of power a battery can delivery per unit
volume or weight.

BATTERY COMPETITION

The market for batteries and other proposed products of the Company
is highly competitive, subject to rapid change and significantly affected by
new product introductions and other market activities of industry
participants. The Company's proposed battery products are targeted at an
emerging market of electric powered automobiles and other vehicles, and the
Company's competitors offer a variety of products and services to address this
market. Further, the Company currently faces direct and indirect competition
from traditional batteries.

The battery industry is mature, well-established and highly
competitive. The industry is characterized by a few major domestic and foreign
producers including Exide, Delphi, A.C. Delco, Johnson Controls, Inc., GNB,
Electrosource, Inc., Energy Conversion Devices, Inc., Hawker and Yuasa, all of
which have substantially greater financial resources than the Company.
Accordingly, the Company's ability to succeed in this market depends upon its
ability to demonstrate superior performance and cost attributes of its
technology. The Company has historically concentrated its activities in the
electric vehicle segment of the market with a view to demonstrating improved
energy to weight and longer battery life in comparison to traditional
lead-acid batteries. The principal competitors of the Company in the electric
vehicle market have directed their efforts to other battery types, such as
nickel-cadmium, nickel-metal hydride, nickel-iron and sodium-sulfur batteries,
rather than lead-acid formulations, although at least one major automobile
manufacturer and one major battery company are known to have research and
development projects underway to develop lead-acid batteries for electric
vehicles.

In the future, because there are relatively low barriers to entry in
the battery industry, the Company could experience additional competition from
other established or emerging companies as the market continues to develop and
expand. Many potential competitors may have well-established relationships
with the Company's potential customers, have extensive knowledge of the
industry, better name recognition and significantly greater financial,
technical, sales, marketing and other resources and are capable of offering
batteries which have multiple applications. It is also possible that new
competitors or alliances among competitors may emerge and rapidly acquire
significant market share. The Company also expects that competition will
increase as a result of industry consolidations. The Company's competitors may
be able to respond more quickly to new or emerging technologies and changes in
customer requirements, or to devote greater resources to the development,
promotion and sale of their battery products.

Increased competition may result in price reductions, reduced gross
margins and loss of market share, any of which could adversely affect the
Company's business, financial condition or results of operations. There can be
no assurance that the Company will be able to compete successfully against
current or future competitors or that

<PAGE>

competitive pressure will not adversely affect its business, financial
condition or results of operations.

The Company believes that the principal competitive factors affecting
its market include features such as functionality, weight, adaptability, ease
of use, product reputation, quality, price, performance, customer service and
support, effectiveness of sales and marketing efforts and company reputation.
Although the Company believes that it will compete favorably with respect to
such factors, there can be no assurance that the Company can establish a
competitive position against current and potential competitors, especially
those with greater financial, marketing, service, support, technical and other
resources than the Company.

PIPELINE CONNECTION TECHNOLOGY

The Company is conducting research and development operations
regarding its patented pipeline connection technology. The Company is
developing equipment designed to join large diameter pipe utilizing magnetic
pulse methods, a cold form method joining a metal sleeve around the ends of
two abutting pipes.

A hinged magnetic work coil developed by the Company is clamped
around the sleeve joining two pipes to produce a ringed shaped crimping force
forcing a uniform joint with uniform stress distributions. The pipes may have
annular grooved ends, grooved to approximately 1/3 of its depth, to be gripped
by the grooves of the sleeve. A pressure sensitive adhesive may be applied to
the pipe ends to improve the performance and seal of the splice. When the
magnetic pulse is applied by the equipment, it instantly crushes the sleeve
onto the pipe and into the shallow grooves milled into the pipe ends, which
improves its pullout resistence.

This pipeline connection technology is particularly useful for
joining oil and gas pipelines, oil and gas well casings, and other large pipe
connections such as those at refineries, chemical plants and other industrial
operations. Because arc welding or other forms of extreme heat are hazardous
which are avoided by the Company's technology, there are substantial
advantages in safety, avoidance of property damage, and avoidance of
microcracks that can form splits and rupture under stress. The cold magnetic
impulse method creates a uniform joint connection between pipes. The process
is significantly faster than arc welding, requires less operator skill than
welding, and avoids costly and complicated post-welding inspections. The
magnetic impulse method also has the advantage that it can be performed in the
field in any weather condition.

The Company's pipeline connection technology is based upon the
principle that whenever a rapidly changing magnetic flux cuts across a
conductive material, such as the grooved sleeve to be used by the Company, a
current is induced in the material. The current is proportional to the initial
intensity and time rate of change of the magnetic flux. The induced current
creates an associated magnetic field of such polarity as to oppose the
magnetic field of such polarity as to oppose the magnetic field producing the
current, creating very significant forces of repulsion. This effect is
commonly called "Lenz's Law of Repulsion". This repulsion force of the
Company's work coil pinches the conductive sleeve around the pipes.

The Company intends to construct a preliminary prototype of its
pipeline connection equipment during 1998, and intends to seek a joint venture
partner to further develop and market its equipment.

ALLOY SENSOR TECHNOLOGY

The Company is conducting research and development operations
regarding its patented alloy sensor technology.

The Company has been developing its alloy sensor technology as a
permanently installed water detection device to check for the presence of
water in storage tanks, fuel tanks and other systems. The alloy sensor is
mounted on a valve socket that is connected to a meter. A plug inserted into
the value permits periodic inspection and reads the meter. Only a short time
is necessary to check a number of fuel tanks, for example by the use of the
plug and single ammeter without opening a drain valve (unless it is necessary
to drain detected water out of the tank).

The alloy sensors of the Company provides positive detection of water
wherever needed and can be connected to a flow system or moisture alarms to
detect leaks.
28
<PAGE>

GRAIN DRYING TECHNOLOGY

The Company is researching and developing microwave technology to
effectively dry grain to acceptable levels for storage and sale. The MicroDry
process is being designed to move grain within the harvesting machinery
(combine) via air pressure resulting in less damage to crops and lower
maintenance costs because of fewer moving parts within the harvester. The
MicroDry process is being developed for a more efficient, cost effective and
improved grain drying during harvesting.

These technological advancements should significantly increase the
productivity and profitability of grain farming. For example, grain such as
wheat, soybeans, and corn all have a certain moisture content. To be properly
stored, grain must be dried to the proper moisture level to prevent spoilage
and mold, some of which is toxic to humans and livestock. While wheat and
soybeans typically are harvested at lower moisture levels and are therefore
easier to dry to safe levels in the field and after harvesting, corn in the
United States is typically harvested at an average of 25% moisture content and
must be dried to 10% to 15% moisture content for safe storage and acceptance
at elevators for sale. Since grain and corn farming is a commodity processing
business, there is little or no control over the price received for the
product. If there is any influence over price, it is based on the farmers
ability to hold inventory until the market prices have improved or produce a
product that will not be discounted due to damage or excessive moisture
content. Accordingly bottom line profitability is based substantially on
marginal improvements and productivity and the ability to lower costs.
Currently, producers have to sell at current grain prices, regardless of
whether they are favorable or not, pay dockage at grain elevator in order to
have the grain dried there for storage, or purchased portable driers for their
farms which adds significantly to fuel requirements of a modern farm and
introduces another time consuming phase in the entire harvesting and grain
preparation process.

The Company's MicroDry equipment is being developed to retrofit to
existing combines to allow for the use of microwave technology in conjunction
with the heat already generated by the combine in order to dry the grain
during harvesting, saving the farmer money, time and allowing them to hold
their grain until commodity prices are most favorable.

Currently, the grain harvester has an elevator duct that lifts the
grain into the storage tank located at the top of the harvester. The MicroDry
process would replace this duct with an air lift structure that would begin
the drying process while lifting the corn, or other grain, to the tank by
using the warm air. The MicroDry process is being designed to be a highly
effective, efficient, and less damaging means of moving grain within the
harvesting combine and through additional procedures that are involved in the
harvesting process.

The MicroDry process will result in an efficient and effective
process for drying grain both during the harvesting procedure and immediately
following the combining of grain using microwave technology and sources of
heat and energy that are freely available during the combining process. The
new technology which the Company is seeking to develop should be more
appealing to farmers and other users of grain moving and drying equipment than
the existing portable grain driers or the cost of paying grain elevators to
dry harvested grain. The use of heat and energy sources already available as a
result of the harvesting process in combination with microwave technology will
result in more fuel efficiency and savings, a reduction in labor intensive
farm grain drying and dockage fees at grain elevators.

RESEARCH AND DEVELOPMENT

The Company has committed, and expects to continue to commit in the
future, substantial resources for the development of its products. Research
and development efforts are directed at improving the performance and
expanding the capability of its prospective products. Although the Company
expects that certain of its products will be developed internally, the Company
may, based on timing and cost considerations, acquire technology and products
from third parties or retain consultants.

The Company's future success will depend in part upon its ability to
enhance its current products and to develop and introduce new products on a
timely basis that keep pace with technological developments, emerging industry
standards and the increasingly sophisticated needs of its future customers.
There can be no assurance that the Company will be successful in developing or
marketing product enhancements or new products that respond to technological
change or evolving industry standards, that the Company will not experience
difficulties that could delay or prevent the

<PAGE>
successful development, introduction and marketing of these products or that
its new products or enhancements will adequately meet the requirements of the
marketplace and achieve market acceptance. If the Company is unable, for
technological or other reasons, to develop and introduce new products or
enhancements, the Company's business, financial condition or results of
operations could be materially adversely affected.

PROPRIETARY RIGHTS AND LICENSING

The Company's success is heavily dependent upon proprietary
technology. The Company will rely primarily on a combination of patents, trade
secrets, confidentiality procedures and contractual provisions with its
employees, consultants and business partners and in its license agreements to
protect its proprietary rights. In addition to its patents, the Company seeks
to protect its products, documentation and other written materials under trade
secret and copyright laws, which afford only limited protection. Despite the
Company's efforts to protect its proprietary rights, unauthorized parties may
attempt to reverse engineer or otherwise copy aspects of the Company's
products or to obtain and use information that the Company regards as
proprietary. While the Company is not aware that any of its products infringe
upon the proprietary rights of third parties, there can be no assurance that
third parties will not claim infringement by the Company with respect to
current or future products.

EMPLOYEES

As of September 30, 2000, the Company had nine (9) employees and
four (4) consultants. Of the total, seven (7) were engaged in product research
and development, and two (2) were in finance and administration. None of the
Company's employees is represented by a labor union with respect to his or her
employment by the Company. The Company has experienced no organized work
stoppages and believes its relationship with its employees is good. The
Company believes that its future success will also depend to a significant
extent upon its ability to attract, train and retain highly skilled technical,
management, sales, marketing and consulting personnel. Competition for such
personnel in the industry in the United States is intense. There can be no
assurance that the Company will be successful in attracting or retaining such
personnel, and the failure to attract or retain such personnel could have a
material adverse effect on the Company's business or results of operations.

BANKING ARRANGEMENTS

The Company has no banking arrangements for a line of credit or other
borrowings to finance the Company. The Company intends to rely primarily upon
equity financing and joint ventures to finance its operations.

SELLING STOCKHOLDERS

The following table provides certain information with respect to the
Selling Stockholders' beneficial ownership of our Common Stock as of September
30, 2000, and as adjusted to give effect to the sale of all of the shares
offered hereby. The Selling Stockholders currently are not affiliates of ours,
except for the present Investment Agreement between Swartz and the Company.
The Selling Stockholders are not or were not affiliated with registered
broker-dealers. See "Plan of Distribution". The Selling Stockholders possess
sole voting and investment power with respect to the securities shown.

The following persons are the Selling Stockholders of the Company who
are offering their shares of Common Stock to the public.

Number of Percent of class
Number of Shares shares offered by owned by
Name Owned before Offering Selling Stockholders Selling Stockholder
---- --------------------- -------------------- -------------------
<S> <C> <C> <C>
Swartz Private
Equity, L.L.C. 81,185 27,990,000(1)(2) 54.9%(7)

Global Alliance
Partners 0 2,100,000(3) 4.1%

Bentley Capital
Investment Group,
Ltd. (3) 0 800,000(3) 1.6%

Maxim Capital
Management
International (3) 0 800,000(3) 1.6%

Doreta Kleva 0 300,000(3) .06%

IC Holdings 170,000(4) 170,000 .08%

IC Holdings II, LLC 0 99,000(5) .05%

IC Holdings III, LLC 0 200,000(6) 1.1%

</TABLE>
----------------------------
30
<PAGE>

(1) Assumes the exercise of all warrants, options and other stock
acquisition rights of the Selling Stockholders as of September 30,
2000.

(2) Represents (i) 25,000,000 shares of Common Stock that the Company may
request Swartz to purchase under its Investment Agreement dated April
17, 2000; (ii) a warrant for 490,000 shares of Common Stock exercisable
at $.66 per share; and (iii) additional warrants to purchase up to
2,500,000 shares of Common Stock that may be issued to Swartz during
the offering period.

(3) Represents the shares issuable to the Selling Stockholder for the
conversion of their Series A Convertible Note of the Company, and the
exercise of their warrant at $.60 per share.

(4) Represents Common Stock issuable for public relations services provided
to the Company.

(5) Represents an option to purchase 99,999 shares of Common Stock of the
Company, exercisable at prices ranging from $2.00 to $4.00 per share.

(6) Represents an option to purchase 200,000 shares of Common Stock at
$.625 per share.

PUT RIGHTS

On April 17, 2000, we entered into an Investment Agreement with
Swartz. The Investment Agreement entitles us to issue and sell our Common
Stock to Swartz Private Equity, L.L.C. ("Swartz") for up to an aggregate of
$35,000,000 from time to time during the three-year period beginning on the
effective date of this Prospectus. Each election by us to sell stock to
Swartz is referred to as a put right.

In order to invoke a put right, we must have an effective
registration statement on file with the SEC registering the resale of the
shares of Common Stock that may be issued as a consequence of the exercise of
the put right. We must also give at least 10 but not more than 20 business
days' advance notice to the Swartz of the date on which we intend to exercise
a particular put right and we must indicate the maximum number of shares of
Common Stock that we intend to sell to the Swartz. At our option, we may also
designate a maximum dollar amount of Common Stock (not to exceed $2,000,000)
that we will sell under the put and/or minimum purchase price per common
share at which Swartz may purchase shares under the put. The minimum purchase
price may not exceed 80% of the closing bid price of our Common Stock on the
date on which we give the Swartz advance notice of our exercise of a put
right. The number of shares of common stock we may sell to Swartz in a put
may not exceed the lesser of (i) 15% of the aggregate daily reported trading
volume of our common shares, excluding certain block trades of our common
stock, during the 20 business days after the date of our put notice,
excluding any trading days in which the common stock trades below a priced
based upon a minimum price, if any, that we specify in our put notice; (ii)
15% of the aggregate daily reported trading volume of our common shares,
excluding certain block trades of our common stock, during the 20 business
days before the put date, or (iii) a number of shares that, when added to the
number of shares acquired by Swartz under the investment agreement during the
31 days preceding the put date, would exceed 9.99% of our total number of
shares of common stock outstanding (as calculated under Section 13(d) of the
Securities Exchange Act of 1934).

For each share of Common Stock, Swartz will pay us the lesser of:

(a) the market price for such share, minus $.25, or
(b) 91% of the market price for the share;

provided, however, that the Swartz may not pay us less than the designated
minimum per share price, if any, that we indicate in our notice.

Market price is defined as the lowest closing bid price for the
Common Stock on its principal market during the pricing period. The pricing
period is defined as the 20 business days immediately following the day we
exercise the put right.

WARRANTS

Within five business days after the end of each pricing period, we
are required to issue and deliver to Swartz a warrant to purchase a number of
shares of Common Stock equal to 10% of the common shares issued to Swartz in
the applicable put. Each warrant will be exercisable at a price that will
initially equal 120% of the market price on the date on which we exercised the
put rights. Each warrant will be immediately exercisable and have a term
beginning on the date of issuance and ending five years thereafter.

Limitations and conditions precedent to our put rights. Swartz is not
required to acquire and pay for any shares of Common Stock with respect to any
particular put for which, between the date we give advance notice of an
intended put and the date the particular put closes:

(a) we have announced or implemented a stock split or combination
of our Common Stock;
(b) we have paid a Common Stock dividend;

<PAGE>

(c) we have made a distribution of all or any portion of our
assets or evidences of indebtedness to the holders of our
Common Stock; or
(d) we have consummated a major transaction, such as a sale of all
or substantially all our assets or a merger or tender or
exchange offer that results in a change of control of the
Company.

SHORT SALES

Swartz and its affiliates are prohibited from engaging in short sales
of our Common Stock unless Swartz has received a put notice under which shares
have not yet been issued and the amount of shares involved in the short sale
does not exceed the number of shares specified in the put notice.

CANCELLATION OF PUTS

We must cancel a particular put between the date of the advance put
notice and the last day of the pricing period if:

(a) we discover an undisclosed material fact that represents a
material misstatement or omission from this Prospectus;
(b) the registration statement registering resales of the common
shares becomes ineffective; or
(c) our shares are delisted from the then primary exchange.

If the put is canceled, it will continue to be effective, but the
pricing period for the put will terminate on the date notice of cancellation
of the put is given to Swartz. Because the pricing period will be shortened,
the number of shares Swartz will be required to purchase in the canceled put
will be smaller than it would have been had the put not be canceled.

SHAREHOLDER APPROVAL

Under the Investment Agreement, we may sell Swartz a number of shares
that is more than 20% of our shares outstanding on the date of this
Prospectus. If we become listed on the NASDAQ Small Cap Market or NASDAQ
National Market, we may be required to obtain shareholder approval to issue
some or all of the shares to Swartz. As we are currently a NASD Electronic
Bulletin Board company, we do not need shareholder approval.

TERMINATION OF INVESTMENT AGREEMENT

We may terminate our right to initial further puts or terminate the
Investment Agreement at any time by providing Swartz with notice of such
intention to terminate; however, any such termination will not affect any
other rights or obligations we have concerning the Investment Agreement or any
related agreement.

RESTRICTIVE COVENANTS

During the term of the Investment Agreement and for a period of one
year after the Investment Agreement is terminated, we are prohibited from
engaging in certain transactions. These include the issuance of any equity
securities, or debt securities convertible into equity securities, for cash
in a private transaction without obtaining the prior written approval of
Swartz. We are also prohibited from entering into any private equity line
type agreements similar to the Investment Agreement (April 17, 2000) through
one year after the Investment Agreement is terminated.

SWARTZ'S RIGHT OF INDEMNIFICATION

We have agreed to indemnify Swartz (including its stockholders,
officers, directors, employees, investors and agents) from all liability and
losses resulting from any misrepresentations or breaches we make in connection
with the Investment Agreement, our registration rights agreement, other
related agreements, or the registration statement.

HOLDERS OF SERIES A CONVERTIBLE WARRANTS

The Company previously sold $1,000,000 of its Series A Convertible
Notes which are convertible into 2,000,000

<PAGE>

shares of its Common Stock. The holders were also granted warrants to purchase
2,000,000 shares of Common Stock at an exercise price of $.60 per share. The
holders of the Notes, assuming they exercise their warrants, may offer up to
4,000,000 shares of Common Stock through this Prospectus.

PLAN OF DISTRIBUTION

The Selling Stockholders are free to offer and sell its common shares
at such times, in such manner and at such prices as it may determine. The
types of transactions in which the common shares are sold may include
transactions in the over-the-counter market (including block transactions),
negotiated transactions, the settlement of short sales of common shares of a
combination of such methods of sale. The sales will be at market prices
prevailing at the time of sale or at negotiated prices. Such transactions may
or may not involve brokers or dealers. The Selling Stockholders have advised
us that they have not entered into agreements, understandings or arrangements
with any underwriters or broker-dealers regarding the sale of their shares.
The Selling Stockholders do not have an underwriter or coordinating broker
acting in connection with the proposed sale of the common shares.

The Selling Stockholders may sell their shares directly to
purchasers or to or though broker-dealers, which may act as agents or
principals. These broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders. They may
also receive compensation from the purchasers of common shares for whom such
broker-dealer may act as agents or to whom they sell as principal, or both
(which compensation as to a particular broker-dealer might be in excess of
customary commissions). Swartz is, and each remaining Selling Stockholder and
any broker-dealer that assists in the sale of the Common Stock may be deemed
to be, an underwriter within the meaning of Section 2(a)(11) of the
Securities Act. Any commissions received by such broker-dealers and any
profit on the resale of the common shares sold by them while acting as
principals might be deemed to be underwriting discounts or commissions. The
Selling Stockholders may agree to indemnify broker-dealers for transactions
involving sales of the Common Stock against certain liabilities, including
liabilities arising under the Securities Act.

Because the Selling Stockholders are and may be deemed to be an
"underwriter" within the meaning of Section 2(a)(11) of the Securities Act,
the Selling Stockholders will be subject to prospectus delivery requirements.

We have informed the Selling Stockholders that the anti-manipulation
rules of the SEC, including Regulation M promulgated under the Securities and
Exchange Act, may apply to their sales in the market and has provided the
Selling Stockholders with a copy of such rules and regulations.

The Selling Stockholders also may resell a portion of the common
shares in open market transactions in reliance upon Rule 144 under the
Securities Act, provided they meet the criteria and conform to the
requirements of such Rule.

We are responsible for all costs, expenses and fees incurred in
registering the shares offered hereby. The Selling Stockholders are
responsible for brokerage commissions and other expenses, if any, attributable
to the sale of such securities.

<PAGE>

MANAGEMENT

DIRECTORS AND OFFICERS

The directors and officers of the Company are as follows:

Name(1)(2) Age Position
---------- --- --------
<S> <C> <C>
Lee A. Balak 46 Director and President
Alvin A. Snaper 71 Director, Vice President - Development, Secretary and Treasurer
William E. McNerney 67 Director and Executive Vice President
Ulf J. Lindqwister 41 Vice President - Business Development
F. Bryson Farrill 72 Director
Hugo P. Pomrehn, Ph.D. 62 Director

</TABLE>

---------------
(1) The Company presently has no executive committee, nominating committee
or audit committee of the Board of Directors.

(2) The officers of the Company hold office until their successors are
elected and qualified, or until their death, resignation or removal.

The background and principal occupations of each Director and Officer of the
Company are as follows:

Mr. Balak became a director and the President of the Company during
February 1996. From February 2000 to the present Mr. Balak has been a director
and the President of Fluidic/Microwave Systems, Inc., a Nevada corporation.
From 1993 to the present, Mr. Balak has been the owner and President of No. 90
Corporate Ventures, a Canadian corporation located in Vancouver, B.C. From
1983 to 1993, he was a corporate finance consultant. From 1977 to 1982, he was
a registered representative of Canarim Investment Corporation (currently named
Canacord Investment Corporation). While employed by Canarim Investment
Corporation, Mr. Balak was the subject of an administrative proceeding by the
British Columbia Securities Commission regarding various alleged violations of
the Securities Act, S.B.C. 1985, c.83 of British Columbia (the "Act"); and in
November 1990, he undertook and agreed that certain trading exemptions under
the Act would not apply or be available for a period of three years and that
he would not be a director or officer of any reporting issuer for a period of
three years, which period was subsequently reduced to February, 1992, by a
variance order. In 1991, he was discharged in bankruptcy by the Supreme Court
of British Columbia. Mr. Balak attended the University of Winnipeg.

Mr. Snaper became a director, Vice President-Development, Secretary
and Treasurer of the Company in March 1998; and has been a director and
President of PowerTek Technologies Corporation, Inc., a subsidiary of the
Company, since its incorporation in 1996. From February 2000 to the present,
Mr. Snaper has been a director and Treasurer of Fluidic/Microwave Systems,
Inc., a Nevada corporation. From 1979 to 1983, he was a director of American
Methyland Homogenized Fuels Corporation. From 1980 to the present, he has been
the Vice President of Neo-Dyne Research, Inc., a research and development
company. From 1985 to the present, he has also been the Vice President of
Inventrex Corp. Mr. Snapper was a founder of Advanced Patent Technology, Inc.,
a public company now known as Alliance Gaming, and was its Vice President and
Director of Research and Development from 1968 to 1980. From 1952 to 1955, he
was the chief Chemist for McGraw Colorgraph Company, a division of the
Carnation Company. From 1949 to 1951, he was employed by the Bakelite Division
of Union Carbide, where he assisted in its development of the pilot plant for
plastics manufacture. During his 30 years of scientific research and
development, Mr. Snapper's interdisciplinary technology activities have
resulted in over 600 patents, products, processes and innovations. He has been
awarded the Design News Best Patent of the year award on three separate
occasions. Mr. Snaper graduated from McGill University with a bachelor of
science degree in 1950. He is a registered professional engineer in the State
of California.

Mr. McNerney became a director and Executive Vice President of the
Company in March 1998. From February 2000 to the present, Mr. McNerney has
been a director and Secretary of Fluidic/Microwave Systems, Inc., a Nevada
corporation. From 1993 to the present, he has been the owner and Chief
Executive Officer of Revolutionary Technology Industries, Inc. From 1984 to
1993, he was retired. From 1974 to 1984, Mr. McNerney owned an oil and

<PAGE>

gas operating company, Golden Exploration, Inc. From 1954 to 1976, Mr.
McNerney was a pilot employed by Northwest Airlines.

Mr. Farrill became a director of the Company on October 25, 1999.
From 1990 to the present, Mr. Farrill has been a financial consultant to high
technology companies and other companies. Mr. Farrill is a director of
Future link Distributing, Inc. From 1968 to 1964, he was the President and
Chairman of McLeod Young Weir International, a brokerage firm until it was
acquired by Scotia Capital Markets. From 1962 to 1979, he was employed by
McCleod Young Weir Ltd in Toronto, and was a director and member of its
executive committee from 1964 to 1989. Mr. Farrill received a B.A. decree
in political science and economics from the University of Toronto in 1951.

Mr. Lindqwister became the Vice President - Business Development of
the Company in May 2000. From 1997 to the present, he has been the President
of Gist Incorporated, a consultant regarding corporate valuations, negotiation
of mergers and acquisitions and management services. From Septemper 1999 to
April 2000, he was the president and a director of Mirage Computers, Inc., a
publicly traded computer company (symbol MIRG). From 1988 to July 1999, Mr.
Lindqwister was employed by the Jet Propulsion Laboratory in Pasadena,
California, engaged in the development of global GPS network stations. Mr.
Lindqwister received a B.A. degree in physics from Temple University in 1982,
a Ph.D. in physics from Princeton University in 1988, and a MBA degree from
U.C.L.A. in 1999.

Dr. Pomrehn became a director of the Company during July 1998. Dr.
Pomrehn is the Chairman of the Board and a director of Stayhealthy
Incorporated, a closely held health products company. From November 1997 to
August 1999, he was the Executive Vice President of Special Projects of
American Technologies Group, Inc. ("ATG"), a public company engaged in
research and development activities; and has been a consultant to ATG since
August 1999 to the present. Dr. Pomrehn previously served as President, Chief
Operating Officer, Vice Chairman and a director of ATG from April 1995 to
November 1997. He was appointed as Under Secretary of Energy by President
George Bush in 1992. He was employed by Bechtel Corporation from 1967 to 1992,
and was a Vice President and Manager of its Los Angeles regional office from
1990 to 1992. Dr. Pomrehn graduated from the University of Southern California
with a bachelor of science degree in mechanical engineering in 1960; received
a masters degree in mechanical engineering from George Washington University
in 1965; received a masters degree in industrial engineering from the
University of Southern California in 1969; and received a doctorate in
engineering from the University of Southern California in 1975. Dr. Pomrehn is
a member of the American Nuclear Society and American Society of Mechanical
Engineers, and is a registered professional mechanical and nuclear engineer in
the State of California.

COMMITTEES OF THE BOARD OF DIRECTORS

STOCK PLAN COMMITTEE

A Stock Plan Committee of the Board of Directors administers the
Company's Stock Option, SAR and Stock Bonus Plan (the "Plan"). Messrs. Lee A.
Balak, Alvin A. Snaper, and William E. McNerney serve as members of the
Committee.

OTHER COMMITTEES

The Company does not have an audit committee, compensation committee,
nominating committee, an executive committee of the Board of Directors, or any
other committees. However, the Board of Directors may establish various
committees during the 2001 fiscal year.

COMPENSATION OF DIRECTORS

Each non-employee director will receive $500 for each Board meeting
attended, and for each committee meeting attended on days other than those on
which the Board meets, and will receive reimbursement of travel expenses.
Directors of the Company have not received any compensation in their capacity
as directors as of the date hereof, except reimbursement of travel expenses.

COMPENSATION OF EXECUTIVE OFFICERS

<PAGE>

The following table sets forth the total cash compensation, paid or
accrued, by the Company during its fiscal year ended January 31, 2000, to each
executive officer and all executive officers as a group for services in all
capacities to the Company.

Cash Compensation(1) Stock Compensation
--------------------- ------------------
<S> <C> <C>
Lee A. Balak..................................................... $ 0 $ 92,000 (4)

William E. McNerney.............................................. $ 0 $ 18,000 (5)

Alvin A. Snaper.................................................. $ 0 $ 92,000 (4)

All executive officers as a group (3 persons) (2) (3) $ 0 $ 202,000

</TABLE>

----------------------------

(1) Personal benefits received by the Company's executive officers are
valued below the levels which would otherwise require disclosure under
the rules of the U.S. Securities and Exchange Commission. See
"Transactions with Management".

(2) The Company does not currently provide any contingent or deferred forms
of compensation arrangements, annuities, pension or retirement
benefits.

(3) The Company has no employment contracts with its executive officers or
employees; however, the Company has a consulting agreement with William
E. McNerney, the Executive Vice President and a director of the
Company, and with Hugo P. Pomrehn, a director of the Company.

(4) Represents a year-end stock bonus of 200,000 shares of Common Stock
that was awarded by the Board of Directors as compensation, in lieu of
salary and bonuses, effective December 31, 1999.

(5) Represents 30,000 shares of Common Stock issued under the terms of the
consulting agreement between Mr. McNerney and the Company.

CERTAIN TRANSACTIONS

In June 1998, the Company leased approximately 5,000 square feet of
offices and research facilities on a month-to-month basis for $2,000 per month
from Mr. Alvin A. Snaper, a director, Vice President, Secretary and Treasurer
of the Company and his partner. During the fiscal years ended January 31, 1999
and 2000, the Company paid $24,000 and $24,000, respectively in lease payments
for these facilities.

Mr. Lee A. Balak, the President and a director of the Company, had
previously loaned and advanced approximately $258,500 to the Company as of
December 22, 1999, for research and development fees. The research and
development fees were paid by the Company in part to Neo-Dyne Research, Inc.
("Neo-Dyne"), a research and development company owned by Alvin A. Snaper, a
director and a Vice President, Secretary and Treasurer of the Company.
Neo-Dyne has conducted substantially all of the research and development
activities regarding the principal products of the Company, including its
batteries, its pipeline connection technology, and its allow sensor
technology, which provided continuity for such services. On December 22, 1999,
the Company authorized the issuance of 1,034,000 shares of restricted Common
Stock at $.25 per share to Mr. Balak in exchange for the cancellation of this
debt, including accrued interest.

<PAGE>

In June 1999, the Company acquired rights to advanced microwave
technology designed to reduce the moisture content of agricultural products,
from Alvin A. Snaper and William E. McNerney, directors and officers of the
Company, who each received 100,000 shares of restricted Common Stock of the
Company in exchange for this technology.

Effective April 1, 1999, the Company entered into a consulting
agreement for a term of one year with William E. McNerney, a director and Vice
President of the Company for $5,000 per month, payable quarterly in the Common
Stock of the Company, in lieu of cash, valued at 85% of its lowest closing bid
price during the quarter. During the year ended January 31, 2000, the Company
issued 30,000 shares of Common Stock to Mr. McNerney, and issued 53,055 shares
of Common Stock to him during fiscal 2001, under the terms of the consulting
agreement. This consulting agreement was renewed for one year effective March
31, 2000. Mr. McNerney receives no salary or other compensation from the
Company as a director and officer, except reimbursement of expenses.

The Company entered into a consulting agreement with Mr. Hugo P.
Pomrehn, a director of the Company, effective September 1, 1998, for research
and development services. The consulting fee is charged at a rate of $150 per
hour, and he is reimbursed for travel and other expenses. During the year
ended January 31, 2000, Mr. Pomrehn received 50,000 shares of restricted
common stock as compensation from the Company.

Effective April 15, 2000, the Company agreed to compensate Ulf J.
Lindqwister, Vice President - Business Development, through a salary of $5,000
per month and though the monthly issuance of 5,000 shares of restricted Common
Stock of the Company for his services, or to Gist Incorporated, his personal
consulting company. As of September 30, 2000, 16,250 shares of Common Stock
have been issued to Gist Incorporated, a consulting company wholly owned by
Mr. Lindqwister.

PRINCIPAL STOCKHOLDERS

The total number of shares of Common Stock of the Company
beneficially owned by each of the officers and directors, and all of such
directors and officers as a group, and their percentage ownership of the
outstanding Common Stock of the Company as of September 30, 2000, are as
follows:

SHARES PERCENT OF PERCENT OF
MANAGEMENT BENEFICIALLY COMMON STOCK COMMON STOCK
SHAREHOLDERS(1) OWNED(1) BEFORE OFFERING AFTER OFFERING
--------------- ------------ --------------- --------------
<S> <C> <C> <C>
Lee A. Balak . . . . . . . . . . . . . . . 4,702,000 25.4% 9.5%
15 Ocean View Road
Lions Bay, B.C. V0N 2E0
Canada

Bryson F. Farrill. . . . . . . . . . . . . 0 0% 0%
305 Old Oaks Road
Fairfield, Connecticut 06432

William E. McNerney. . . . . . . . . . . . 724,471 3.9% 1.5%
953 E. Sahara, #9B
Las Vegas, Nevada 89104

Hugo P. Pomrehn, Ph.D. . . . . . . . . . . 50,000 0.3% .01%
5211 Dartmouth Avenue
Westminster, California 92683

Alvin A. Snaper. . . . . . . . . . . . . . 954,155 5.2% 1.9%
2800 Cameo Circle
Las Vegas, Nevada 89107

<PAGE>

Ulf J. Lindqwister . . . . . . . . . . . . 26,250 .001% .001%
9717 Royal Lamb Drive
Las Vegas, Nevada 89145

Directors and officers as a group
(6 persons, including the above) . . . . 6,456,876 34.8% 13.1%

</TABLE>

-------------------

(1) Except as otherwise noted, it is believed by the Company that all
persons have full voting and investment power with respect to the
shares indicated. Under the rules of the Securities and Exchange
Commission, a person (or group of persons) is deemed to be a
"beneficial owner" of a security if he or she, directly or
indirectly, has or shares the power to vote or to direct the voting
of such security, or the power to dispose of or to direct the
disposition of such security. Accordingly, more than one person may
be deemed to be a beneficial owner of the same security. A person is
also deemed to be a beneficial owner of any security which that
person has the right to acquire within 60 days, such as options or
warrants to purchase the Common Stock of the Company.

The following table sets forth information with respect to the
beneficial ownership of the Company's Common Stock by each shareholder who
beneficially owns more than five percent (5%) of the Company's Common Stock,
the number of shares beneficially owned by each and the percent of outstanding
Common Stock so owned of record as of September 30, 2000. It is believed by
the Company that all persons listed have sole voting and investment power with
respect to their shares, except as otherwise indicated.

SHARES PERCENT
NAME AND ADDRESS TITLE OF OUTSTANDING BENEFICIALLY
OF BENEFICIAL OWNER CLASS COMMON STOCK OWNED
------------------- -------- ------------- ------------
<S> <C> <C> <C>
Lee A. Balak Common Stock 4,702,000 25.4%
15 Ocean View Road
Lions Bay, B.C. V0N 2E0
Canada

Global Alliance Partners Common Stock 2,100,000(1) 10.2%
c/o Buser Management
Todistrasse 51
Postfach 1059
8039 Zurich
Switzerland

Alvin A. Snaper Common Stock 954,155 5.2%
2800 Cameo Circle
Las Vegas, Nevada 89107

Cede & Co. Common Stock 11,395,927(2) 61.6%
P.O. Box 222
Bowling Green Station
New York, New York 10274

</TABLE>
---------------------------

(1) Represents a warrant held by Global Alliance Partners to purchase
1,050,000 shares of Common Stock of the Company, exercisable at $.50
per share until January 28, 2001, and the conversion of its Series A
Convertible Note into 1,050,000 shares of Common Stock.

<PAGE>

(2) Cede & Co. is a depository that holds securities as nominee for various
broker-dealers and others to facilitate stock transfers.

DESCRIPTION OF CAPITAL STOCK

AUTHORIZED AND OUTSTANDING CAPITAL STOCK

Our authorized capital stock as of September 30, 2000, consisted of
25,000,000 shares of Common Stock, of which 18,509,305 were issued and
outstanding. As of September 30, 2000, our outstanding Common Stock was held
of record by a total of 35 stockholders.

Our Articles of Incorporation will be amended to provide for total of
authorized capital consisting of 100,000,000 shares of Common Stock, $.001 par
value, and 1,000,000 shares of preferred stock, $.001 par value, as approved by
the shareholders of the Company at their annual meeting held on September 14,
2000.

COMMON STOCK

The holders of Common Stock are entitled to one vote per share on all
matters submitted to a vote of our stockholders and do not have cumulative
voting rights. Accordingly, holders of a majority of the shares of Common
Stock entitled to vote in any election of directors may elect all of the
directors standing for election. Subject to preferences that may be applicable
to any preferred stock outstanding at the time, the holders of outstanding
shares of Common Stock are entitled to receive ratably any dividends out of
assets legally available therefor as our board of directors may from time to
time determine. Upon liquidation, dissolution or winding up of the Company,
holders of our Common Stock are entitled to share ratably in all assets
remaining after payment of liabilities and the liquidation preference of any
then outstanding shares of preferred stock. Holders of Common Stock have no
preemptive or conversion rights or other subscription rights. There are no
redemption or sinking fund provisions applicable to the Common Stock. All
outstanding shares of Common Stock are fully paid and nonassessable.

PREFERRED STOCK

According to our proposed Amendment to the Articles of Incorporation,
our board of directors will have the authority, without further action by the
stockholders, to issue up to 1,000,000 shares of preferred stock, in one or
more series. Our board shall determine the rights, preferences, privileges and
restrictions of the preferred stock, including dividend rights, conversion
rights, voting rights, terms of redemption, liquidation preferences, sinking
fund terms and the number of shares constituting any series or the designation
of any series. The issuance of preferred stock could diminish voting power of
holders of Common Stock, and the likelihood that holders of preferred stock
will receive dividend payments and payments upon liquidation may have the
effect of delaying, deferring or preventing a change in control of the
Company, which could depress the market price of our Common Stock. We have no
present plan to issue any shares of preferred stock.

OUTSTANDING WARRANTS

We had warrants outstanding to purchase 2,000,000 shares of Common
Stock at exercise price of $.60 per share, which expire on or before January
28, 2001, which were issued to the holders of our Series A Convertible Notes.

There is also an outstanding warrant to Swartz Private Equity, L.L.C.
("Swartz") to purchase 490,000 share of our Common Stock at a price of $.66
per share. These warrants were issued to Swartz in consideration of its
commitment to enter into an Investment Agreement. The warrant expires on April
17, 2005. Swartz has the right to have the Common Stock issuable upon exercise
of the warrant included on any registration statement we file, other than a
registration statement covering an employee stock plan or a registration
statement filed in connection with a business combination or reclassification
of our securities.

<PAGE>

Each of the warrants contain provisions for the adjustment of the
exercise price and the aggregate number of shares issuable upon the exercise
of the warrants in the event of stock dividends, stock splits,
reorganizations and reclassifications and consolidations.

SERIES A CONVERTIBLE NOTES

The Company has issued $600,000 of its Series A Convertible Notes
(the "Notes"). The Notes are convertible into the Common Stock of the Company
at $.50 per share for a total of 2,000,000 shares of Common Stock upon full
conversion, with interest at the rate of 10% per annum payable in Common
Stock of the Company at $.50 per share.

OUTSTANDING STOCK OPTIONS

The Company presently has issued and outstanding stock options to
purchase 2,629,999 shares of Common Stock at exercise prices ranging from
$.40 to $4.00 per share.

ANTI-TAKEOVER PROVISIONS OF NEVADA LAW

We may become subject to Sections 78.411 to 78.444 of the Nevada
General Corporation Law. In general, the statute prohibits a Nevada
corporation with 200 or more stockholders of record from engaging in any
business combination with any interested stockholder for a period of three
years following the date that the stockholder became an interested
stockholder unless:

(1) prior to that date, our board of directors approved either the
business combination or the transaction that resulted in the
stockholder becoming an interested stockholder;

(2) upon consummation of the transaction that resulted in the
stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced,
excluding those shares owned by persons who are directors and
also officers, and by employee stock plans in which shares
held subject to the plan will be tendered in a tender or
exchange offer; or

(3) on or subsequent to that date, the business combination is
approved by our board of directors and is authorized at an
annual or special meeting of stockholders, and not by written
consent, by the affirmative vote of at least two-thirds of the
outstanding voting stock not owned by the interested
stockholder.

Section 78.416 defines "business combination" to include:

- any merger or consolidation involving the corporation and
the interested stockholder;

- any sale, transfer, pledge or other disposition involving the
interested stockholder of 5% or more of the aggregate market
value of the assets of the corporation, or more than 5% of the
market value of all outstanding shares of the Company, or
representing 10% or more of the earning power or net income of
the Company;

- subject to exceptions, any transaction that results in the
issuance or transfer by the corporation of any stock of the
corporation to the interested stockholder; and

- the receipt by the interested stockholder of the benefit of
any loans, advances, guarantees, pledges or other financial
benefits provided by or through the corporation.

In general, Section 78.423 defines an interested stockholder as any
entity or person beneficially owning 10% or more of the outstanding voting
stock of the corporation and any entity or person affiliated with or
controlling or controlled by the entity or person.

<PAGE>

Nevada law may have the effect of deterring hostile takeovers or
delaying changes in control of our management, which could depress the market
price of our Common Stock.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is Pacific
Stock Transfer Company in Las Vegas, Nevada.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, we may have up to 50,969,304
shares of Common Stock outstanding. Of these shares, the 32,459,999 shares
sold in this offering in addition to the current public "float" of 11,994,300
shares which will be freely tradable without restriction under the Securities
Act, unless purchased by our "affiliates", as that term is defined in Rule
144 under the Securities Act. There are 5,515,005 shares of restricted Common
Stock of the Company which are issued and outstanding that will become
eligible for sale in the future.

RULE 144

In general, under Rule 144 a person (or persons whose shares are
aggregated) who has beneficially owned shares for at least one year is
entitled to sell within any three-month period a number of shares that does
not exceed the greater of

- 1% of the then outstanding shares of our Common Stock
(approximately 509,693 shares immediately after this
total offering), or

- the average weekly trading volume during the four calendar
weeks preceding such sale, subject to the filing of a Form 144
with respect to the sale.

A person (or persons whose shares are aggregated) who is not deemed
to have been our affiliate at any time during the 90 days immediately
preceding the sale who has beneficially owned his or her shares for at least
two years is entitled to sell these shares pursuant to Rule 144(k) without
regard to the limitations described above. Affiliates must always sell
pursuant to Rule 144, even after the applicable holding periods have been
satisfied.

We cannot estimate the number of shares that will be sold under Rule
144, as this will depend on the market price for our Common Stock, the
personal circumstances of the sellers and other factors. Any future sale of
substantial amounts of our Common Stock in the open market may adversely
affect the market price of our Common Stock.

STOCK OPTIONS

We intend to file a registration statement on From S-8 under the
Securities Act to register up to 2,000,000 shares of our Common Stock that
may become subject to outstanding options or reserved for issuance under our
2000 Stock Option, SAR and Stock Bonus Plan following the effectiveness of
such registration statement, which permits the resale of these shares by
nonaffiliates in the public market without restriction under the Securities
Act.

LEGAL MATTERS

Stephen A. Zrenda, Jr., P.C., Oklahoma City, Oklahoma, has provided
us with an opinion as to the validity of the Common Stock offered under this
Prospectus.

EXPERTS

G. Brad Beckstead, independent auditor, has audited our consolidated
financial statements as of January 31, 2000. Crouch, Bierwolf & Chisolm,
independent auditors, has audited our financial statements for each of our
fiscal years ended January 31, 1997, 1998 and 1999. We have included our
financial statements in this Prospectus and

<PAGE>

elsewhere in the registration statement in reliance on reports given upon
their authority as experts in accounting and auditing.

With respect to the unaudited financial statements of the Company for
the six month period ended July 31, 2000, appearing herein, such statements
have not been audited by G. Brad Beckstead, C.P.A. or by Crouch, Bierwolf &
Chisolm, and they do not express an opinion on them. Because the unaudited
financial statements of the Company for the six month period ended July 31,
2000, included herein were prepared by management of the Company, there is no
assurance that material differences will not occur in such information upon
audit although the Company believes that such information is correct and
complete to the best of its knowledge and belief. The Company has made all
adjustments which in the opinion of management are necessary in order to make
the unaudited financial statements not misleading.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed with the Securities and Exchange Commission a
registration statement on From S-1 under the Securities Act with respect to
the shares of Common Stock offered under this Prospectus. This Prospectus
does not contain all of the information in the registration statement and the
exhibits and schedules to the registration statement. For further information
with respect to us and our Common Stock, we refer you to the registration
statement and to the exhibits and schedules to the registration statement.
Statements contained in this Prospectus as to the contents of any contract or
any other document referred to are not necessarily complete, and in each
instance, we refer you to the copy of the contract or other document filed as
an exhibit to the registration statement. Each of these statements is
qualified in all respects by this reference. You may inspect a copy of the
registration statement without charge at the SEC's principal office in
Washington, D.C., and copies of all or any part of the registration statement
may be obtained from the Public Reference Section of the SEC, 450 Fifth
Street, N.W., Washington, D.C. 20549, upon payment of fees prescribed by the
SEC. The SEC maintains a World Wide Web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the SEC. The address of the Web site is
http://www.sec.gov. The SEC's toll free investor information service can be
reached at 1-800-SEC-0330.

We are subject to the information reporting requirements of the
Securities Exchange Act of 1934, as amended, and we file reports, proxy
statements and other information with the SEC.

We intend to furnish our stockholders with annual reports containing
financial statements audited by our independent public accountants and
quarterly reports for the first three fiscal quarters of each fiscal year
containing unaudited interim financial information. Our telephone number is
(702) 382-3385.

<PAGE>

G. BRAD BECKSTEAD
CERTIFIED PUBLIC ACCOUNTANT
330 E. Warm Springs
Las Vegas, NV 89119
702.528.1984
425.928.2877efax

INDEPENDENT AUDITOR'S REPORT

To the Board of Directors and Stockholders
of Power Technology, Inc.

I have audited the accompanying consolidated balance sheet of Power
Technology, Inc. (a development stage company) as of January 31, 2000 and the
related consolidated statements of operations, stockholders' equity and cash
flows for the year then ended. These financial statements are the
responsibility of the Company's management. My responsibility is to express
an opinion on these financial statements based on my audit.

I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audits 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. I believe that my audit provides a
reasonable basis for my opinion.

In my opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Power
Technology, Inc. (a development stage company) as of January 31, 2000 and the
results of its operations, stockholders' equity and cash flows for the year
then ended in conformity with generally accepted accounting principles.

The financial statements of Power Technology, Inc. as of January 31, 1999 and
January 19, 1996 (date of inception) through January 31, 1999, were audited
by other auditors whose report dated April 19, 1999, expressed an unqualified
opinion on those statements.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in
Note 2 to the financial statements, the Company has had recurring operating
losses for the past several years. These factors raise substantial doubt
about its ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2. The consolidated
financial statements do not include any adjustments that might result from
the outcome of this uncertainty.

/s/ G. Brad Beckstead

Las Vegas, Nevada
May 2, 2000

F-1

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Consolidated Balance Sheets

ASSETS

January 31, January 31, July 31,
1999 2000 2000
(Audited) (Audited) (Unaudited)
<S> <C> <C> <C>
Current Assets
Cash $ 60,499 $ 76,015 $ 232,114
Accounts receivable 2,500 - 1,000
--------------------------------------------------
Total current assets 62,999 76,015 233,114

Property & Equipment, Net (Note 3) 11,384 12,831 18,142
--------------------------------------------------

Other Assets
Prepaid expenses 20,000 20,000 20,000
Organizational costs (Note 1) 10,000 5,000 2,500
Patents (Note 8) 65,000 65,000 78,500
--------------------------------------------------
95,000 90,000 101,000
--------------------------------------------------

$ 169,383 $ 178,846 $ 352,256
==================================================

LIABILITIES AND STOCKHOLDERS' EQUITY

<S> <C> <C> <C>
Current Liabilities
Accounts payable - trade $ 10,492 $ 5,184 $ -
Advances from MicroDri (Note 6) - 86,067 53,003
Accrued expenses 16,469 16,469 16,469
Loan payable (Note 6) 164,685 110,000 165,036
--------------------------------------------------
Total current liabilities 191,646 217,720 234,508

Convertible debt (Note 7) - 65,515 600,760
--------------------------------------------------

191,646 283,235 835,268

Common stock, $.001 par value;
25,000,000 shares authorized;
12,535,000, 16,817,500 and 17,664,000
shares issued and outstanding as of,
1/31/99, 1/31/00 and 7/31/00,
respectively 12,535 16,818 17,664
Additional paid-in capital 857,392 1,659,458 2,062,362
Deficit accumulated during the
development stage (892,190) (1,800,665) (2,563,038)
Prior period adjustment (Note 8) - 20,000 -
--------------------------------------------------
(22,263) (104,389) (483,012)
--------------------------------------------------

$ 169,383 $ 178,846 $ 352,256
==================================================
</TABLE>

F-2

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Consolidated Statements of Operations

For the years ended For the six months ended
January 31, January 31, July 31, July 31,
1999 2000 1999 2000
(Audited) (Audited) (Unaudited) (Unaudited)
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues $ - $ - $ - $ -

Expenses
General & Administrative 515,588 803,111 251,294 594,204
Research & Development 166,936 105,164 53,324 188,169
--------------------------------------------------------------------------

Net Operating Loss (682,524) (908,275) (304,618) (782,373)

Other Expenses
Interest expense (16,469) - - -
Loss on foreign currency
translation (1,916) - - -
--------------------------------------------------------------------------

Net loss $ (700,909) $ (908,275) $ (304,618) $ (782,373)
==========================================================================

Weighted average shares
outstanding 9,667,208 16,817,500 7,517,350 17,663,500
==========================================================================

Loss per share $ (.07) $ (.05) $ (.04) $ (.04)

==========================================================================
</TABLE>

F-3

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity

Deficit
Accumulated
Additional During Prior Total
Paid-in Development Period Stockholders'
Shares Amount Capital Stage Adjustment Equity
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance, January 19, 1996 2,500,000 $ 2,500 $ 22,500 $ - $ - $ 25,000
Net loss - - - (139,907) - (139,907)
----------------------------------------------------------------------------------------
Balance, January 31, 1997 2,500,000 2,500 22,500 (139,907) - (114,907)

Net loss - - - (51,374) - (51,374)
----------------------------------------------------------------------------------------
Balance, January 31, 1998 2,500,000 2,500 22,500 (191,281) - (166,281)

Reorganization of Company,
Reverse acquisition of 2,800,000 2,800 (2,573) - - 227
Zepplin, Inc.
Common stock issued for cash 6,900,000 6,900 683,100 - - 690,000
Common stock issued for 200,000 200 19,800 - - 20,000
patents
Common stock issued for 134,700 135 134,565 - - 134,700
services
Net loss - - - (700,909) - (700,909)
----------------------------------------------------------------------------------------
Balance, January 31, 1999 12,534,700 12,535 857,392 (892,190) - (22,263)

Common stock issued for cash 2,900,000 2,900 287,099 - - 290,000
Common stock issued for 548,800 549 329,001 - - 329,550
services
Common stock issued to
stockholder in exchange for 1,034,000 1,034 205,766 - - 206,800
debt
Prior period adjustment (200,000) (200) (19,800) - 20,000 (20,000)
Net loss - - - (908,475) - (908,475)
----------------------------------------------------------------------------------------
Balance, January 31, 2000 16,817,500 $ 16,818 $ 1,659,458 $ (1,800,665) $ 20,000 $ 104,389
========================================================================================
</TABLE>

F-4

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Consolidated Statements of Cash Flows

For the years ended For the six months ended
January 31, January 31, July 31, July 31,
1999 2000 1999 2000
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash Flows from Operating Activities
Net loss $ (700,909) $ (908,475) $ (304,618) $ (782,373)

Less non-cash items:
Prior period adjustment - 20,000 - -
Depreciation and amortization expense 7,137 7,272 2,500 2,500
(Increase) decrease in accounts receivable (2,500) 2,500 (1,000) (1,000)
(Increase) decrease in prepaid expenses (20,000) - - -
Increase (decrease) in accounts payable (6,104) (5,308) 49,215 (5,184)
Increase (decrease) in accounts payable - related
party - (99,170) - 535,245
Increase (decrease) in accrued expenses 16,469 - - -
Common stock issued for services 134,700 516,349 - -
----------------------------------------------------------------------
NET CASH USED BY OPERATING ACTIVITIES (571,207) (466,832) (253,903) (250,812)
----------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Equipment (13,294) (3,719) (3,719) (5,311)
Cash paid for patent (45,000) - - -
Investment in technology - - - (13,500)
Advances from (repayments to) MicroDri - 86,067 - (35,539)
Loan payable - related party - 110,000 - 57,511
----------------------------------------------------------------------
NET CASH PROVIDED (USED) BY FINANCING
ACTIVITIES
(58,294) 192,348 (3,719) 3,161
----------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Cash from issuance of stock 690,000 290,000 302,250 403,750
----------------------------------------------------------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 690,000 290,000 302,250 403,750
----------------------------------------------------------------------

INCREASE IN CASH 60,499 15,516 44,628 156,099
Cash at Beginning of Period - 60,499 60,499 76,015

----------------------------------------------------------------------
Cash at End of Period $ 60,499 $ 76,015 $ 105,127 $ 232,114
======================================================================

Supplemental Non-Cash Financing Transactions:
Interest $ - $ - $ - $ -
Income taxes $ - $ - $ - $ -
</TABLE>

F-5

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Notes to Consolidated Financial Statements

NOTE 1 - Summary Of Significant Accounting Policies

a. Organization

The Company was incorporated under the name of Zeppelin
Production Corporation on June 3, 1996 under the laws of the State of
Nevada. The Company was organized to provide aerial photography and
advertising promotion through the use of helium filled remote control
blimps, however, operations were never secured.

Pursuant to a plan of reorganization and acquisition
agreement dated February 15, 1998, the Company acquired PowerTek
Technology, Inc. (PowerTek) and changed its name to Power Technology,
Inc. Because the management and operations of PowerTek became the
management and operations of Zeppelin, this business combination has
been recorded as a reverse acquisition.

PowerTek was incorporated under the laws of the State of
Nevada on January 19, 1996. The Company was organized primarily for the
purpose of developing an advanced battery technology for use in the
growing electric car industry. As of the date of these statements, the
Company has been able to advance the battery technology to a proof of
principle stage and is currently seeking additional capital to finance
the development of the technology to a preliminary prototype stage.

b. Recognition of Revenue

The Company recognizes income and expense on the accrual
basis of accounting.

c. Earnings (Loss) Per Share

The computation of earnings per share of common stock is
based on the weighted average number of shares outstanding at the date
of the financial statements.

d. Cash and Cash Equivalents

The Company considers all highly liquid investments with
maturities of three months or less to be cash equivalents.

e. Provision for Income Taxes

No provision for income taxes have been recorded due to net
operating loss carryforwards totaling approximately $2,563,038 that
will be offset against future taxable income. These NOL carryforwards
will begin to expire in the year 2012. No tax benefit has been reported
in the financial statements because the Company believes there is a 50%
or greater chance the carryforward will expire unused.

F-6

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Notes to Consolidated Financial Statements

NOTE 1 - Summary Of Significant Accounting Policies (continued)

f. Principles of Consolidation

These financial statements include the books of Power
Technology, Inc (formerly Zeppelin) and its wholly owned subsidiary
PowerTek Technologies, Inc. All intercompany transactions and balances
have been eliminated in the consolidation.

g. Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and expenses during the reporting
period. In these financial statements, assets, liabilities and expenses
involve extensive reliance on management's estimates. Actual results
could differ from those estimates.

h. Organizational Costs

Organizational costs are amortized over a period of 60
months. Amortization expense for the years ended December 31, 1999 and
1998 is $2,500 per year.

NOTE 2 - Going Concern

The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern. The
Company has had recurring operating losses for the past several years
and is dependent upon financing to continue operations. The financial
statements do not include any adjustments that might result from the
outcome of this uncertainty. It is the intent of management to obtain
additional working capital and a profitable level of operations.

NOTE 3 - Property and Equipment

Property and equipment consists of the following at July
31, 2000, January 31, 2000 and 1999:

For the six
For the years ended months ended
January 31, January 31, July 31,
1999 2000 2000
--------------------------------------------------
<S> <C> <C> <C>
Office equipment $ 8,863 $ 10,773 $ 16,084
Manufacturing equipment 4,076 4,076 4,076
Leasehold improvements 2,164 2,164 2,164
--------------------------------------------------
Accumulated depreciation (3,719) (4,182) (4,182)
--------------------------------------------------
Net property & equipment $ 11,384 $ 12,831 $ 18,142
==================================================
</TABLE>

Depreciation expense for the period ended July 31, 2000,
January 31, 2000 and 1999 is $0, $2,272 and $1,910, respectively.

F-7

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Notes to Consolidated Financial Statements

NOTE 4 - Capitalization

Prior to the reverse acquisition of Power Technology, Inc.
(formerly Zepplin Production Corp.) and PowerTek Technology, Inc.
(PowerTek) the Company authorized 2,500,000 shares at a par value of
$.01 and had 2,500,000 issued and outstanding. The par value in these
financial statements have been retroactively restated to show the new
par value $0.001.

In the reverse acquisition, the 2,500,000 shares of
PowerTek were exchanged for 5,000,000 shares of Power Technology, Inc.
(formerly Zepplin Production Corp.). The total number of
post-acquisition shares authorized are 25,000,000 at a par value of
$.001. Total number of post-acquisition shares issued and outstanding
were 5,300,000 shares.

During June 1998, the Company issued 200,000 shares of
Common Stock for patents valued at $20,000.

During November 1998, the Company issued 134,700 shares of
Common Stock in exchange for services valued at $134,700.

On December 22, 1999, the Company issued 1,034,000 shares
of restricted Common Stock at $.25 per share to Mr. Lee A. Balak, the
President and a director of the Company, in exchange for cancellation
of a $258,500 note, including accrued interest.

During the year ended January 31, 1999, the Company issued
6,900,000 shares of Common Stock for cash of $690,000.

During the year ended January 31, 2000, the Company issued
2,900,000 shares of Common Stock for cash of $290,000.

During the year ended January 31, 2000, the Company issued
548,800 shares of Common Stock in exchange for services valued at
$329,550.

During the six months ended July 31, 2000, the Company
issued 846,000 of Common Stock for cash in the amount of $403,750.

NOTE 5 - Development Stage Company

The Company is a development stage company as defined in
Financial Accounting Standards Board Statement No. 7. It is
concentrating substantially all of its efforts in raising capital in
order to generate significant operations.

NOTE 6 - Accounts and Loans Payable - Related Party

The Company had $65,515 of research and development fees
paid for by a majority shareholder. The balance was non-interest
bearing through January 31, 1999. For the year ended January 31, 2000,
the balance was interest bearing at 10% per annum. The Company intends
to repay the balance within one year.

F-8

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Notes to Consolidated Financial Statements

NOTE 6 - Accounts and Loans Payable - Related Party (continued)

The Company had $86,067 of research and development fees
advanced by MicroDri, L.P., a related entity with common shareholders
and management. The Company will continue to perform research and
development procedures which will be invoiced against the fee
advancements.

Mr. Lee A. Balak, the President and a director of the
Company, loaned and advanced approximately $258,500 to the Company as
of December 22, 1999, for research and development fees. The research
and development fees were paid by the Company to Neo-Dyne Research,
Inc. ("Neo-Dyne"), a research and development company owned by Alvin
A. Snaper, also a director, Vice President, Secretary and Treasurer of
the Company. Neo-Dyne has conducted substantially all of the research
and development activities regarding the principal products of the
Company, including its batteries, pipeline connection technology, and
its allow sensor technology. On December 22, 1999, the Company
authorized the issuance of 1,034,000 shares of restricted Common Stock
at $.25 per share to Mr. Balak in exchange for the cancellation of the
$258,500 debt, including accrued interest.

Mr. Lee A. Balak, the President and a director of the
Company, loaned $110,000 to the Company. The note is due on demand,
and the balance is non-interest bearing through January 31, 2000.

The Company rents a facility in Las Vegas, Nevada from
Bonanza West Properties, a partnership 50% owned by Alvin A. Snaper, a
director and Vice President of the Company. Rents for the year ended
January 31, 2000 totaled approximately $24,000.

NOTE 7 - Series A Convertible Notes

The Company has issued $600,000 of its Series A Convertible
Notes (the "Notes"). The Notes are convertible into the Common Stock
of the Company at $.50 per share for a total of 1,200,000 shares of
Common Stock upon full conversion, with interest at the rate of 10%
per annum payable in Common Stock of the Company at $.50 per share.

NOTE 8 - Patents

On June 9, 1998, the Company acquired patent number
4,107,997 issued by the U.S. Patent office in 1978. The Company paid
$45,000 and 100,000 shares of Common Stock valued at $10,000 for the
patent. The patent is for an alloy sensor which generates a current
when in contact with water or other aqueous composition.

Also during 1998, the Company acquired patent number
5,442,846 for 100,000 shares of Common Stock valued at $10,000. This
patent is a procedure and apparatus for cold joining of metallic
pipes.

F-9

<PAGE>

POWER TECHNOLOGY, INC.
(A Development Stage Company)
Notes to Consolidated Financial Statements

NOTE 9 - Prior Period Adjustment

An adjustment in the amount of $20,000 has been recorded on
the books as of January 31, 2000. The adjustment is due to an
over-reported shareholders' equity amount in the prior year ended
January 31, 1999. The entry has been recorded to reduce additional
paid-in capital and to offset the overstated expense in the prior
year.

NOTE 10 - Commitments

In connection with the acquisition of patent number
5,442,846, the Company is committed to a 3% royalty on gross sales.

NOTE 11 - Subsequent Events

The Company entered into an Investment Agreement dated
April 17, 2000 (the "Agreement") with Swartz Private Equity, LLC of
Roswell, Georgia ("SPE"). The Agreement provides for SPE to commit to
purchase up to an aggregate of $35,000,000 of the Common Stock of the
Company, as requested from time to time by the Company as its equity
capital needs arise during the term of the Agreement. Upon written
notice from the Company, SPE is committed to purchase Common Stock of
the Company at a purchase price equal to the lesser of the (i) then
current market price minus $.25, or (ii) 91% of the then current
market price. Market price is defined to mean the lowest bid price for
Common Stock on the last business day during a pricing period (the
date following the notice from the Company and ending on the 20th day
thereafter). Unless the Company specifically requests SPE to purchase
its Common Stock by written notification to SPE, SPE has no right to
acquire any securities of the Company and the Company has no
obligation to offer and sell its securities to SPE. Under the terms of
the Agreement, the Company has issued to SPE a warrant to purchase
490,000 shares of the Common Stock of the Company at an initial
exercise price of $.8125 per share, subject to adjustment, payable in
cash or in a cashless exercise based upon a formula adjusted by such
exercise price and the average closing price for five trading days
prior to the exercise date, (with price reset provisions) during a
term of five years. The Company will be issuing additional warrants to
SPE to purchase a number of shares equal to 10% of each purchase of
shares made by SPE during the term of the Agreement. The shares of
Common Stock and warrants of the Company to be issued to SPE are
covered by a Registration Rights Agreement requiring the Company to
file a registration statement with the U.S. Securities and Exchange
Commission to register such securities under the Securities Act of
1933.

F-10

<PAGE>

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE
NOT AUTHORIZED ANYONE TO PROVIDE INFORMATION DIFFERENT FROM THAT CONTAINED IN
THIS PROSPECTUS. WE ARE OFFERING TO SELL, AND SEEKING OFFERS TO BUY, SHARES
OF COMMON STOCK ONLY IN JURISDICTIONS WHERE OFFERS AND SALES ARE PERMITTED.
THE INFORMATION CONTAINED IN THIS PROSPECTUS IS ACCURATE ONLY AS OF THE DATE
OF THIS PROSPECTUS REGARDLESS OF THE TIME OF DELIVERY OF THIS PROSPECTUS, OR
OF ANY SALE OF OUR COMMON STOCK.

---------

TABLE OF CONTENTS

PAGE
----

<S> <C>

Prospectus Summary ...........................................................4
Summary Financial Information.................................................5
Risk Factors..................................................................6
Forward-Looking Statements.................................................. 13
Use of Proceeds..............................................................14
Dividend Policy..............................................................14
Price Range of Common Stock..................................................14
Capitalization...............................................................16
Management's Discussion and Analysis of
Financial Condition and Results of Operations...........................17
Business.....................................................................25
Selling Stockholders.........................................................30
Plan of Distribution.........................................................33
Management...................................................................34
Certain Transactions.........................................................36
Principal Stockholders.......................................................37
Description of Capital Stock.................................................39
Shares Eligible for Future Sale..............................................41
Legal Matters................................................................41
Experts......................................................................41
Where You Can Find Additional Information....................................42
Consolidated Financial Statements...........................................F-1

</TABLE>

UNTIL ____________, 2000 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS THAT BUY, SELL OR TRADE IN THESE SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
DEALERS ARE ALSO OBLIGATED TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

POWER TECHNOLOGY, INC.

32,459,999 SHARES

COMMON STOCK

PROSPECTUS

____________, 2000

<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The expenses to be paid by the Registrant are as follows. All
amounts other than the SEC registration fee are estimates.

<TABLE>
<CAPTION>
AMOUNT
TO BE PAID
----------
<S> <C>

SEC registration fee $ 7,327
Legal fees and expenses 70,000
Accounting fees and expenses 10,000
Printing and engraving 1,000
Blue Sky fees and expenses (including legal fees) 5,000
Transfer agent fees 500
Miscellaneous 10,000
----------
Total $ 103,827
==========

</TABLE>

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 78.7502 of the Nevada corporation law [Title 7, Section 78 NRS]
authorizes a corporation to indemnifY directors and officers who were or are a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, except an action by or in the right of the corporation, by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses, including
attorneys' fees, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with the action, suit or proceeding
if he acted in good faith and in a manner which he reasonably believed to be
in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction or upon a plea of nolo contendere or
its equivalent, does not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the corporation, and that, with respect
to any criminal action or proceeding, he had reasonable cause to believe that
his conduct was unlawful.

A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a judgment in its
favor by reason of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses,
including amounts paid in settlement by attorneys' fees actually and
reasonably incurred by him in connection with the defense or settlement of
the action or suit if he acted in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation. Indemnification may not be made for any claim, issue or matter
as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals therefrom, to be liable to the
corporation or for amounts paid in settlement to the corporation, unless and
only to the extent that the court in which the action or suit was brought or
other court of competent jurisdiction determines upon application that in
view of all the circumstances of the case, the person is fairly and
reasonably entitled to indemnity for such expenses as the court deems proper.

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To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections 1 and 2, or in the
defense of any claim, issue or matter therein, the corporation shall
indemnify him against expenses, including attorneys' fees, actually and
reasonably incurred by him in connection with the defense.

The Twelfth Article of the Articles of Incorporation of the Company
provides that no director or officer of the Company shall be personally
liable to the Company or any of its stockholders for damages for breach of
fiduciary duty as a director or officer involving any act or omission of any
such director or officer, provided, however, that the foregoing provision
shall not eliminate or limit the liability of a director or officer (i) for
violation of law, or (ii) the payment of dividends in violation of Section
78.300 of the Nevada General Corporation Law. Any repeal or modification of
this Articles by the stockholders of the Company shall be prospective only
and shall not adversely affect any limitation on the personal liability of a
director or officer of the Company for acts or omissions to such repeal or
modification.

Article VI of the Bylaws of the Company provides that the Company
shall indemnify all of its officers and directors, past, present and future,
against any and all expenses incurred by them, including but not limited to
legal fees, judgments and penalties which may be incurred, rendered or levied
in any legal action brought against any or all of them for or on account of
any act or omission alleged to have been committed while acting within the
scope of their duties as officers or directors of the Company.

The indemnification provisions in the Registrant's Articles of
Incorporation and in its Bylaws may be sufficiently broad to permit
indemnification of the Registrant's directors and executive officers for
liabilities arising under the Securities Act. The Registrant, with approval
by the Registrant's Board of Directors, expects to obtain directors' and
officers' liability insurance. Reference is made to the following documents
filed as exhibits to this registration statement by incorporation by
referenced to the Exhibits to the Form 10-SB of the Registrant regarding
relevant indemnification provisions described above and elsewhere herein:

DOCUMENT EXHIBIT NUMBER
-------- --------------
<S> <C>

Articles of Incorporation of Registrant, and Amendment 3(i) and 3(ii)
Bylaws of Registrant 3(iii)

</TABLE>

The Company has not entered into indemnification agreements with the
Company's directors and officers.

The rights of indemnification described above are not exclusive of
any other rights of indemnification to which the persons indemnified may be
entitled under any bylaw, agreement, vote of stockholders or directors or
otherwise.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

In connection with the organization of the Company in 1996, the
Company issued 300,000 shares of its Common Stock for $6,000 in reliance upon
Section 4(2) of the Securities Act of 1933.

In 1997, the Company issued 700,000 shares of its Common Stock for
$35,000 in a limited offering made in reliance upon Rule 504 of Regulation D
under the Securities Act of 1933.

In January 1998, in connection with the reorganization of the
Company, the Company issued 3,500,000 shares to Lee Balak, 900,000 shares to
Alvin Snaper, and 600,000 shares to William McNerney in reliance upon Section
4(2) of the Securities Act of 1933.

In April 1998, the Company entered an investor relations consulting
agreement which provided for monthly compensation of $3,000 per month, and
granted stock options for 100,000 shares of Common Stock at prices ranging
from $2.00 to $4.00 pre share for a term of five years in reliance upon
Section 4(2) of the Securities Act of 1933.

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<PAGE>

In April 1998, the Company entered into a marketing consulting
agreement and agreed to issue $5,000 of its Common Stock monthly for a period
of one year, to be registered under a From S-8 registration statement.

In May 1998, the Company issued 5,000,000 shares of its Common Stock
to the stockholders of PowerTek Technology Corporation, Inc. in exchange for
all of its issued and outstanding stock and its assets in reliance upon
Section 4(2) of the Securities Act of 1933.

In June 1998, the Company acquired the patent to its alloy sensor
technology from Alvin A. Snaper in exchange for 100,000 shares of its Common
Stock in reliance upon Section 4(2) of the Securities Act of 1933.

In June 1998, the Company acquired a patent to its pipeline
connection technology from Advanced Transmission Line in exchange for 100,000
shares of its Common Stock in reliance upon Section 4(2) of the Securities
Act of 1933.

In June 1998, the Company issued 12,000 shares of Common Stock as a
referral fee made in reliance upon Section 4(2) of the Securities Act of 1933.

In June 1998, the Company entered into a financial consulting
agreement and agreed to issue $5,000 of its Common Stock monthly, and granted
an option to acquire 200,000 shares exercisable at $4.00 per share for a
period of two years in reliance upon Section 4(2) of the Securities Act of
1933.

During 1998, the Company offered and sold 6,000,000 shares of its
Common Stock for $600,000 in a limited offering made in reliance upon Rule
504 of Regulation D under the Securities Act of 1933.

In January 2000 and in November 2000, the Company offered and sold
$1,000,000 of its Series A Convertible Notes convertible into 2,000,000 shares
of Common Stock and Warrants with an exercise price of $.60 per share covering
2,000,000 shares of Common Stock which expire January 28, 2001 to four foreign
(non-U.S.) investors in reliance upon Regulation S under the Securities Act of
1933.

In April 2000, the Company issued a warrant to purchase 490,000
shares of its Common Stock at $.8125 to Swartz Private Equity, L.L.C. in
reliance upon Section 4(2) under the Securities Act of 1933.

In May 2000, the Company issued 55,555 shares of Common Stock to
William E. McNerney for consulting services in reliance upon Section 4(2) of
the Securities Act of 1933.

In June 2000, the Company issued 225,000 shares of Common Stock to
Seaway Trading, Inc. for consulting services in reliance upon Section 4(2) of
the Securities Act of 1933.

In September 2000, the Company issued 16,250 shares of Common Stock
to Ulf J. Lindqwister, Gist Incorporated, a consulting company, as
compensation for services in reliance upon Section 4(2) of the Securities Act
of 1933.

In October 2000, the Company issued 37,500 shares of Common Stock to
Swartz Private Equity, L.L.C. under the terms of its Investment Agreement
dated April 17, 2000, in reliance upon Section 4(2) of the Securities Act of
1933.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

NUMBER DESCRIPTION
------ -----------
<S> <C>

3(i) Articles of Incorporation of the Registrant The Articles of Incorporation are incorporated herein by
reference to Exhibit 3(i) to the Form 10-SB of the Registrant
(File No. 0-24857)

3(ii) Amendment to Articles of Incorporation The Amendment to the Articles of Incorporation are
incorporated herein by reference to Exhibit 3(ii) to the Form 10-

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<PAGE>
SB of the Registrant (File No. 0-24857)

3(iii) By-Laws of the Registrant The By-Laws are incorporated herein by reference to Exhibit
3(iii) to the Form 10-SB of the Registrant (File No. 0-24857)

5. Legal opinion of Stephen A. Zrenda, Jr., P.C.

10. Material Contracts

10(a) Plan of Reorganization and Acquisition dated 2/15/98 is
incorporated herein by reference to Exhibit 6(a) to the Form
10-SB of the Registrant (File No. 0-24857)

10(b) Various consulting agreements with Registrant are incorporated
herein by reference to the Form S-8 Registration Statement (File
No. 333-66845) of the Registrant

10(c) Consulting agreement with SeaWay Trading, Inc. dated April
19, 1999 is incorporated by reference to Exhibit 10 (c) to the
Form 10-KSB of the Registrant for its fiscal year ended January
31, 1999

10(d) Consulting agreement with William McNerney/RevTec of April
1, 1999 is incorporated by reference to Exhibit 10(d) to the Form
10-KSB of the Registrant for its fiscal year ended January 31,
1999

10(e) Various consulting agreements are incorporated by reference to
Exhibit 4.1 of the Form S-8 registration statement of the
Registrant (File No. 333-66845)

10(f) Investment agreement dated April 17, 2000, with Swartz Private
Equity, L.L.C. is incorporated herein by reference to the Form 8-K
of the Registrant filed on May 23, 2000.

10(g) Registration Rights Agreement with Swartz Private Equity, LLC
dated April 17,2000.

10(h) Warrant issued to Swartz Private Equity, LLC dated April 17,
2000, to purchase 490,000 shares of the Common Stock of the
Registrant.

10(i) Form of purchase Warrant(s) to be issued to Swartz Private
Equity, LLC under terms of Investment Agreement dated April
17, 2000.

10(j) Series A Convertible Note in the amount of $75,000 and
Warrant to purchase 150,000 shares of Common Stock of the
Company is incorporated by reference to Exhibit 10(a) to the
Form 10-QSB of the registrant for the period ended April 30,
2000.

10(k) Series A Convertible Note in the amount of $525,000 and
Warrant to purchase 1,050,000 shares of Common Stock of the
Company is incorporated by reference to Exhibit 10(b) to the
Form 10-QSB of the registrant for the period ended April 30,

II-4

<PAGE>

2000.

10(l) Technology Development and Support Agreement with B.C.
Research, Inc. dated May 3, 2000.

11. Statement re: computation of per share
earnings Reference is made to the Consolidated Statements of Operations
of the Registrant which are incorporated by reference herein.

21. A description of the subsidiary of the
Registrant A description of the subsidiary of the Registrant is incorporated
herein by reference to Exhibit 21 of the Form S-8 Registration
Statement (333-66845) of the Registrant

23.1 Consent of G. Brad Beckstead,
independent auditor

23.2 Consent of Crouch, Bierwolf & Chisolm,
independent auditors

23.3 Consent of Stephen A. Zrenda, Jr., P.C.

24.1 Powers of Attorney (see signature pages)

27. Financial Data Schedule

(b) Financial Statement Schedules Previously filed.

</TABLE>

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide certificates
in such denominations and registered in such names as required by the
purchasers to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the SEC
such indemnification is against public policy as expressed in the Act, and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with
the securities being registered, the Registrant will, unless in the opinion
of counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.

The undersigned Registrant hereby undertakes:

A. (1) To file, during any period in which offers or sales are being
made, post-effective amendment to this registration statement:

1. To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;

2. To reflect in the prospectus any facts or events
arising after the effective date of the

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<PAGE>

registration statement (or the most recent
post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change
in the information set forth in the registration
statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered
(if the total dollar value of securities offered
would not exceed that which was registered) and any
deviation from the low or high end of the estimated
maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20% change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement.

3. To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;

4. That, for the purpose of determining any liability
under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona
fide offering thereof.

5. To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.

6. For purposes of determining any liability under the
Securities Act of 1933 the information omitted from
the form of Prospectus filed as part of this
registration statement in reliance upon Rule 430A and
contained in a form of Prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4), or
497(h) under the Securities Act of 1933 shall be
deemed to be part of this registration statement as
of the time it was declared effective.

POWERS OF ATTORNEY

We, the undersigned directors and/or officers of Power Technology,
Inc. (the "Company"), hereby severally constitute and appoint Lee A. Balak,
President and Chief Executive Officer, with William E. McNerney, Vice
President, and each of them individually, with full powers of substitution
and resubstitution, our true and lawful attorneys, with full powers to them
and each of them to sign for us, in our names and in the capacities indicated
below, the Registration Statement on Form S-1 filed with the SEC, and any and
all amendments to said Registration Statement (including post-effective
amendments), and any registration statement filed pursuant to Rule 462(b)
under the Securities Act of 1933 in connection with the registration under
the Securities Act of 1933 of the Company's Common Stock, and to file or
cause to be filed the same, with all exhibits thereto and other documents in
connection therewith, with the SEC, granting unto said attorneys, and each of
the, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as each of them might or could do in person, and hereby
ratifying and confirming all that said attorneys, and each of the, or their
substitute or substitutes, shall do or cause to be done by virtue of this
Power of Attorney.

SIGNATURE TITLE(S)
--------- --------

/s/ Lee A. Balak President, Chief Executive Officer,
----------------------------- Chief Financial Officer, and Director
Lee A. Balak

/s/ Alvin A. Snaper Vice President, Secretary,
----------------------------- Treasurer and Director
Alvin A. Snaper

/s/ William E. McNerney Vice President and Director
-----------------------------
William E. McNerney

/s/ Hugo P. Pomrehn Director
-----------------------------
Hugo P. Pomrehn

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<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Las Vegas,
State of Nevada, on November 13, 2000.

POWER TECHNOLOGY, INC.
---------------------------
(Registrant)

/s/ Lee A. Balak
---------------------------
By: Lee A. Balak, President

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in their
capacities on November 13, 2000.

/s/ Lee A. Balak /s/ Alvin A. Snaper
-------------------------------------------- ----------------------------------------
Lee A. Balak Alvin A. Snaper
Director, President, Chief Financial Officer Director and Vice President-Development,
and Principal Accounting Officer Treasurer and Secretary

/s/ Hugo P. Pomrehn /s/ William E. McNerney
-------------------------------------------- ----------------------------------------
Hugo P. Pomrehn William E. McNerney
Director Director and Executive Vice President

</TABLE>

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<PAGE>

INDEX TO EXHIBITS

NUMBER DESCRIPTION
------ -----------
<S> <C>
5 Opinion of Stephen A. Zrenda, Jr., P.C.

10(g) Registration Rights Agreement with Swartz Private Equity, LLC dated
April 17, 2000.

10(h) Warrant issued to Swartz Private Equity, LLC dated April 17, 2000, to
purchase 490,000 shares of the Common Stock of the Registrant.

10(i) Form of purchase Warrant(s) to be issued to Swartz Private Equity, LLC
under terms of Investment Agreement dated April 17, 2000.

10(l) Technology Development and Support Agreement with B.C. Research,
Inc. dated May 3, 2000.

23.1 Consent of G. Brad Beckstead

23.2 Consent of Crouch, Bierwolf & Chisholm

23.3 Consent of Stephen A. Zrenda, Jr., P.C.

</TABLE>