UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended - December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from
Commission file number 0-24897
MAS ACQUISITION III CORP.
(Name of Small Business Issuer in its charter)
Delaware 35-1990562
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification Number)
1710 E. Division St., Evansville, Indiana 47711
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (812) 479-7266
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act:
Common Stock, $.001 par value per share
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(D) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
YES [ x ] NO [ ]
Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B is not contained in this form, and no disclosure
will be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-KSB or any amendment to this Form 10-KSB. [ ]
State issuer's revenues for its most recent fiscal year. $ -0-
State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the
average bid and asked prices of such stock, as of a specified date within
the past 60 days. (See definition of affiliate in Rule 12b-2 of the
Exchange Act): -0-
Note: If determining whether a person is an affiliate will involve an
unreasonable effort and expense, the issuer may calculate the aggregate
market value of the common equity held by non-affiliates on the basis of
reasonable assumptions, if the assumptions are stated.
(ISSUER INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: 8,505,670 as of December
31, 1998.
Documents Incorporated by Reference
If the following documents are incorporated by reference, briefly describe
them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.)
into which the documents is incorporated: (1) any annual report to security
holders; (2) any proxy or information statement; and (3) any prospectus
filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933
("Securities Act"). The listed documents should be clearly described for
identification purposes (e.g., annual report to security holders for
fiscal year ended December 24, 1990).
Transitional Small Business Disclosure Format (Check one):
Yes [ ]; No [ x ]
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
BUSINESS DEVELOPMENT
MAS Acquisition III Corp. (the "Company"), was incorporated on
July 31, 1996 in the State of Delaware, to engage in any lawful
corporate undertaking, including, but not limited to, selected
mergers and acquisitions. Pursuant to the Articles of Incorporation,
the Company is authorized to issue 80,000,000 shares of Common Stock
at $.001 par value and 20,000,000 shares of Preferred Stock at $.001
par value. Each holder of the Common Stock shall be entitled to one
vote for each share of Common Stock held. The Preferred Stock may be
divided into Series or Classes by the management of the Company upon
the approval of a majority vote of the Directors of the Company. As
of December 31, 1998, there are 8,505,670 shares of Common Stock and
no shares of Preferred Stock outstanding.
The Company has been in the developmental stage since inception
and has no operations to date. Other than the issuance of shares to its
shareholders, the Company never commenced any operational activities.
As such, the Company can be defined as a "shell" company, whose sole
purpose at this time is to locate and consummate a merger or acquisition
with a private entity.
The Company became a reporting company in November, 1998 on
voluntary basis because the primary attraction of the Company as a
merger partner or acquisition vehicle will be its status as a
reporting public company. Any business combination or transaction may
potentially result in a significant issuance of shares and substantial
dilution to present stockholders of the Company.
The proposed business activities described herein classify the
Company as a "blank check" company. Many states have enacted
statutes, rules and regulations limiting the sale of securities of
"blank check" companies in their respective jurisdictions.
Management does not intend to undertake any offering of the Company's
securities, either debt or equity, until such time as the Company has
successfully implemented its business plan described herein.
<PAGE>
GENERAL BUSINESS PLAN
The Company's purpose is to seek, investigate and, if such
investigation warrants, acquire an interest in business
opportunities presented to it by persons or firms who or which
desire to seek the perceived advantages of an Exchange Act
registered corporation. The Company will not restrict its search
to any specific business, industry, or geographical location and
the Company may participate in a business venture of virtually any
kind or nature. This discussion of the proposed business is
purposefully general and is not meant to be restrictive of the
Company's virtually unlimited discretion to search for and enter
into potential business opportunities. Management anticipates that
it may be able to participate in only one potential business
venture because the Company has nominal assets and limited
financial resources. See Item 7. "FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA." This lack of diversification should be
considered a substantial risk to shareholders of the Company because
it will not permit the Company to offset potential losses from one
venture against gains from another.
The Company may seek a business opportunity with entities
which have recently commenced operations, or which wish to utilize
the public marketplace in order to raise additional capital in
order to expand into new products or markets, to develop a new
product or service, or for other corporate purposes. The Company
may acquire assets and establish wholly-owned subsidiaries in
various businesses or acquire existing businesses as subsidiaries.
The Company intends to advertise and promote the Company in
newspaper, magazine and on the Internet. The Company has not yet
prepared any notices or advertisement.
The Company anticipates that the selection of a business
opportunity in which to participate will be complex and extremely
risky. Due to general economic conditions, rapid technological
advances being made in some industries and shortages of available
capital, management believes that there are numerous firms seeking
the perceived benefits of a publicly registered corporation. Such
perceived benefits may include facilitating or improving the terms
on which additional equity financing may be sought, providing
liquidity for incentive stock options or similar benefits to key
employees, providing liquidity (subject to restrictions of
applicable statutes), for all shareholders and other factors.
Potentially, available business opportunities may occur in many
different industries and at various stages of development, all of
which will make the task of comparative investigation and analysis
of such business opportunities extremely difficult and complex.
<PAGE>
The Company has, and will continue to have, no capital with
which to provide the owners of business opportunities with any
significant cash or other assets. However, management believes the
Company will be able to offer owners of acquisition candidates the
opportunity to acquire a controlling ownership interest in a
publicly registered company without incurring the cost and time
required to conduct an initial public offering. The owners of the
business opportunities will, however, incur significant legal and
accounting costs in connection with acquisition of a business
opportunity, including the costs of preparing Form 8-K's, 10-K's or
10-KSB's, agreements and related reports and documents. The
Securities Exchange Act of 1934 (the "34 Act"), specifically
requires that any merger or acquisition candidate comply with all
applicable reporting requirements, which include providing audited
financial statements to be included within the numerous filings
relevant to complying with the 34 Act. Nevertheless, the officers
and directors of the Company have not conducted market research and
are not aware of statistical data which would support the perceived
benefits of a merger or acquisition transaction for the owners of
a business opportunity.
The analysis of new business opportunities will be undertaken
by, or under the supervision of, the officers and directors of the
Company. Aaron Tsai, President of the Company will be the key person
in the search, review and negotiation with potential acquisition or
merger candidates. Management intends to concentrate on identifying
preliminary prospective business opportunities which may be brought
to its attention through present associations of the Company's
officers and directors, or by the Company's shareholder. In
analyzing prospective business opportunities, management will
consider such matters as the available technical, financial and
managerial resources; working capital and other financial
requirements; history of operations, if any; prospects for the
future; nature of present and expected competition; the quality and
experience of management services which may be available and the
depth of that management; the potential for further research,
development, or exploration; specific risk factors not now
foreseeable but which then may be anticipated to impact the proposed
activities of the Company; the potential for growth or expansion; the
potential for profit; the perceived public recognition of acceptance
of products, services, or trades; name identification; and other
relevant factors. Officers and directors of the Company do not
expect to meet personally with management and key personnel of the
business opportunity as part of their investigation due to lack of
capital. To the extent possible, the Company intends to utilize
written reports and investigation to evaluate the above factors.
The Company will not acquire or merge with any company for which
audited financial statements cannot be obtained within a reasonable
period of time after closing of the proposed transaction.
<PAGE>
The Officers of the Company have limited experience in managing
companies similar to the Company and shall rely upon their own efforts
and, to a much lesser extent, the efforts of the Company's shareholder,
in accomplishing the business purposes of the Company. The Company may
from time to time utilize outside consultants or advisors to effectuate
its business purposes described herein. No policies have been adopted
regarding use of such consultants or advisors, the criteria to be used
in selecting such consultants or advisors, the services to be provided,
the term of service, or regarding the total amount of fees that may be
paid. However, because of the limited resources of the Company, it is
likely that any such fee the Company agrees to pay would be paid in
stock and not in cash.
The Company will not restrict its search for any specific kind
of firms, but may acquire a venture which is in its preliminary or
development stage, which is already in operation, or in essentially
any stage of its corporate life. It is impossible to predict at
this time the status of any business in which the Company may
become engaged, in that such business may need to seek additional
capital, may desire to have its shares publicly traded, or may seek
other perceived advantages which the Company may offer. However,
the Company does not intend to obtain funds in one or more private
placements to finance the operation of any acquired business
opportunity until such time as the Company has successfully
consummated such a merger or acquisition.
It is anticipated that the Company will incur nominal expenses
in the implementation of its business plan described herein.
Because the Company has no capital with which to pay these
anticipated expenses, present management of the Company will pay
these charges with their personal funds, as interest free loans to
the Company. However, the only opportunity which management has to
have these loans repaid will be from a prospective merger or
acquisition candidate. Management has agreed among themselves that
the repayment of any loans made on behalf of the Company will not
impede, or be made conditional in any manner, to consummation of a
proposed transaction.
ACQUISITION OF OPPORTUNITIES
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, reorganization, joint venture, or licensing
agreement with another corporation or entity. It may also acquire
stock or assets of an existing business. On the consummation of a
transaction, it is probable that the present management and
shareholders of the Company will no longer be in control of the
Company. In addition, the Company's directors may, as part of the
terms of the acquisition transaction, resign and be replaced by new
directors without a vote of the Company's shareholders or may sell
their stock in the Company. Any and all such sales will only be
made in compliance with the securities laws of the United States
and any applicable state.
<PAGE>
It is anticipated that any securities issued in any such
reorganization would be issued in reliance upon exemption from
registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of its
transaction, the Company may agree to register all or a part of
such securities immediately after the transaction is consummated or
at specified times thereafter. If such registration occurs, of
which there can be no assurance, it will be undertaken by the
surviving entity after the Company has successfully consummated a
merger or acquisition and the Company is no longer considered a
"shell" company. Until such time as this occurs, the Company does
not intend to register any additional securities. The issuance of
substantial additional securities and their potential sale into any
trading market which may develop in the Company's securities may
have a depressive effect on the value of the Company's securities
in the future, if such a market develops, of which there is no
assurance.
While the actual terms of a transaction to which the Company
may be a party cannot be predicted, it may be expected that the
parties to the business transaction will find it desirable to avoid
the creation of a taxable event and thereby structure the
acquisition in a so-called "tax-free" reorganization under Sections
368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In
order to obtain tax-free treatment under the Code, it may be
necessary for the owners of the acquired business to own 80% or
more of the voting stock of the surviving entity. In such event,
the shareholders of the Company, would retain less than 20% of the
issued and outstanding shares of the surviving entity, which would
result in significant dilution in the equity of such shareholders.
As part of the Company's investigation, officers and directors
of the Company may personally meet with management and key personnel,
may visit and inspect material facilities, obtain analysis of
verification of certain information provided, check references of
management and key personnel, and take other reasonable investigative
measures, to the extent of the Company's limited financial resources
and management expertise. The manner in which the Company participates
in an opportunity will depend on the nature of the opportunity, the
respective needs and desires of the Company and other parties, the
management of the opportunity and the relative negotiation strength of
the Company and such other management.
With respect to any merger or acquisition, negotiations with
target company management is expected to focus on the percentage of
the Company which the target company shareholders would acquire in
exchange for all of their shareholdings in the target company.
Depending upon, among other things, the target company's assets and
liabilities, the Company's shareholders will in all likelihood hold
a substantially lesser percentage ownership interest in the Company
following any merger or acquisition. The percentage ownership may
be subject to significant reduction in the event the Company
acquires a target company with substantial assets. Any merger or
acquisition effected by the Company can be expected to have a
significant dilutive effect on the percentage of shares held by the
Company's then shareholders.
<PAGE>
The Company will participate in a business opportunity only
after the negotiation and execution of appropriate written
agreements. Although the terms of such agreements cannot be
predicted, generally such agreements will require some specific
representations and warranties by all of the parties thereto, will
specify certain events of default, will detail the terms of closing
and the conditions which must be satisfied by each of the parties
prior to and after such closing, will outline the manner of bearing
costs, including costs associated with the Company's attorneys and
accountants, will set forth remedies on default and will include
miscellaneous other terms.
As stated hereinabove, the Company will not acquire or merge
with any entity which cannot provide independent audited financial
statements within a reasonable period of time after closing of the
proposed transaction. The Company is subject to all of the
reporting requirements included in the 1934 Act. Included in these
requirements is the affirmative duty of the Company to file
independent audited financial statements as part of its Form 8-K to
be filed with the Securities and Exchange Commission upon
consummation of a merger or acquisition, as well as the Company's
audited financial statements included in its annual report on Form
10-K (or 10-KSB, as applicable). If such audited financial
statements are not available at closing, or within time parameters
necessary to insure the Company's compliance with the requirements
of the 1934 Act, or if the audited financial statements provided do
not conform to the representations made by the candidate to be
acquired in the closing documents, the closing documents will
provide that the proposed transaction will be voidable, at the
discretion of the present management of the Company. If such
transaction is voided, the agreement will also contain a provision
providing for the acquisition entity to reimburse the Company for
all costs associated with the proposed transaction.
<PAGE>
The Company does not intends to provide the Company's security
holders with any complete disclosure documents, including audited
financial statements, concerning an acquisition or merger candidate and
its business prior to the consummation of any acquisition or merger
transaction.
COMPETITION
The Company will remain an insignificant participant among the
firms which engage in the acquisition of business opportunities.
There are many established venture capital and financial concerns
which have significantly greater financial and personnel resources
and technical expertise than the Company. In view of the Company's
combined extremely limited financial resources and limited
management availability, the Company will continue to be at a
significant competitive disadvantage compared to the Company's
competitors.
<PAGE>
IITEM 2. DESCRIPTION OF PROPERTY.
The Company currently maintains a mailing address at 1710 E.
Division St., Evansville, Indiana 47711, which is the address of its
President. The Company pays no rent for the use of this mailing
address. The Company does not believe that it will need to maintain
an office at any time in the foreseeable future in order to carry
out its plan of operations described herein.
<PAGE>
ITEM 3. LEGAL PROCEEDINGS.
The Company is not a party to any legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted during the fourth quarter of the calendar
year covered by this report to a vote of security holders.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
(a) Market Information.
There is not market for the Company's securities.
(b) Holders.
As of December 31, 1998, there were approximately 145 holder of
the Company's Common Stock.
(c) Dividends.
The Company has never paid a cash dividend on its Common Stock
and has no present intention to declare or pay cash dividends on
the Common Stock in the foreseeable future. The Company intends
to retain any earnings which it may realize in the foreseeable
future to finance its operations. Future dividends, if any, will
depend on earnings, financing requirements and other factors.
<PAGE>
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITIONS.
The following discussion should be read in conjunction with the
information contained in the financial statements of the Company
and the Notes thereto appearing elsewhere herein.
Results of Operations - July 31, 1996 (Inception) through December 31, 1998.
The Company is considered to be in the development stage as
defined in Statement of Financial Accounting Standards No. 7.
There have been no operations since incorporation.
Liquidity and Capital Resources.
The Company issued 8,505,670 shares of its Common Stock.
The Company has no operating history and no material assets. The Company
has $-0- in cash as of December 31, 1998.
Year 2000 Issue
Year 2000 issues are not currently material to the Company's business,
operations or financial condition, and the Company does not currently
anticipate that it will incur any material expenses to remediate Year
2000 issues it may encounter. However, Year 2000 issues may become
material to the Company following its completion of a business combination
transaction. In that event, the Company will be required to adopt a
plan and a budget for addressing such issues.
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
<TABLE>
<CAPTION>
(1) Financial Statements Page
<S> <C>
Report of Independent Auditors F-1
Balance Sheet at December 31, 1998 F-2
Statements of Operations for the Years ended
December 31, 1997 and 1998, and the
period from Inception (July 31, 1996) to
December 31, 1998 F-3
Statement of changes in Stockholders' Equity
for the period from Inception (July 31, 1996),
through December 31, 1998 F-4
Statements of Cash Flows for the Years ended
December 31, 1997 and 1998, and the
period from Inception (July 31, 1996) to
December 31, 1998 F-5
Notes to Financial Statements F-6
</TABLE>
<PAGE>
TUBBS & BARTNICK, P.A.
- ----------------------------
CERTIFIED PUBLIC ACCOUNTANTS
REPORT OF INDEPENDENT AUDITORS
Shareholders and Board of Directors
MAS Acquisition III Corp.
We have audited the accompanying balance sheet of MAS Acquisition III Corp.
(a development stage Company) as of December 31, 1998, and the related
statements of operations, changes in stockholders' equity, and cash flows
for each of the years ended December 31, 1997 and 1998, and the period from
July 31, 1996 (date of inception) to December 31, 1998. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we 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. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of MAS Acquisition III Corp.
(a development stage Company) as of December 31, 1998, and the results of its
operations, and its cash flows for each of the years ended December 31, 1997
and 1998, and the period from July 31, 1996 (date of inception) to December
31, 1998 in conformity with generally accepted accounting principles.
/s/ Tubbs & Bartnick, P.A.
Tubbs & Bartnick, P.A.
Certified Public Accountants
Boca Raton, Florida
January 11, 1999
2300 GLADES ROAD, SUITE 415E, BOCA RATON, FL 33431, TEL (561) 361-
0330, FAX (561) 368-7720
(Member - AICPA Division for CPA Firms)
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Balance Sheet
As of December 31, 1998
ASSETS
Current assets:
Total current assets $ -
Other assets:
Organization costs net of amortization of $45 45
-------
Total assets $ 45
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
Stockholders' equity:
Preferred stock, $.001 par value
20,000,000 shares authorized
none issued or outstanding $ -
Common stock, $.001 par value,
80,000,000 shares authorized,
8,505,670 shares issued and
outstanding 96
Deficit accumulated during the
development stage (51)
------
Total liabilities and stockholders' equity $ 45
======
Read the accompanying notes to the financial statements.
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Statements of Operations
For the Years Ended December 31, 1997 and 1998 and
the Period From Inception (July 31, 1996) to December 31, 1998
Year Year Inception
Ended Ended to
December 31, December 31, December 31,
1997 1998 1998
------------ ------------ ------------
Revenue $ - $ - $ -
Costs and expenses:
General and Administrative 22 20 51
--------- -------- --------
Net (loss) $ (22) $ (20) $ (51)
========= ======== ========
Per share information:
Weighted average number
of common shares
outstanding 8,502,825 8,504,368 8,502,398
========= ========= =========
Basic (loss) per share $ (.00) $ (.00) $ (.00)
======= ======= ========
Read the accompanying notes to the financial statements.
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the Period From (Inception) July 31, 1996, through
December 31, 1998
Deficit Accumulated
During the
Common Stock Development Stage Total
---------------- ------------------- -----
Shares Amount
------ ------
Shares issued at inception
for organization costs
aggregating $90 8,500,000 $ 90 $ - $ 90
Net (loss) for the period - - (9) (9)
--------- ------- -------- --------
Balance December 31, 1996 8,500,000 90 (9) 81
Shares issued for
services at $.001
per share during
January, 1997 500 1 1
Gift shares issued
during March, 1997 at
$.001 per share 3,100 3 3
Net (loss) for the period - - (22) (22)
--------- ------- -------- --------
Balance December 31, 1997 8,503,600 94 (31) 63
Gift shares issued
during September, 1998 at
$.001 per share 2,070 2 2
Net (loss) for the period - - (20) (20)
--------- ------- -------- --------
Balance December 31, 1998 8,505,670 $ 96 $ (51) $ 45
========= ======= ======== ========
Read the accompanying notes to the financial statements.
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Statements of Cash Flows
For the Years Ended December 31, 1997 and 1998, and
the Period From Inception (July 31, 1996) to December 31, 1998
Year Year Inception
Ended Ended to
December 31, December 31, December 31,
1997 1998 1998
------------ ------------ ------------
Cash Flows From Operating Activities:
Net (loss) $ (22) $ (20) $ (51)
Adjustments to reconcile net (loss) to
net cash used in operating activities:
Amortization 18 18 45
Issuance of common stock for services 1 - 1
Gift shares issued 3 2 5
--------- --------- ---------
Net cash provided by (used in)
operations - - -
--------- --------- ---------
Cash flows from investing activities:
Net cash provided by (used in)
investing activities - - -
--------- --------- ---------
Cash flows from financing activities:
Net cash provided by (used in)
financing activities - - -
--------- --------- ---------
Net increase (decrease) in cash and
cash equivalents - - -
--------- --------- ---------
Beginning cash and cash equivalents - - -
--------- --------- ---------
Ending cash and cash equivalents $ - $ - $ -
========= ========= =========
Supplemental cash flow information:
Cash paid for: Income taxes - - -
Interest - - -
Non-cash investing an financing
activities:
Common shares issued for organization
costs $ - $ - $ 90
Read the accompanying notes to the financial statements.
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Notes to Financial Statements
As of December 31, 1998
Note 1. SIGNIFICANT ACCOUNTING POLICIES
Organization
The Company was incorporated on July 31, 1996, in the State of Delaware. The
Company is in the development stage and its intent is to locate suitable
business ventures to acquire. The Company has had no significant business
activity to date and has chosen December 31, as a year end.
Cash and cash equivalents
Cash and cash equivalents consist of cash and other highly liquid debt
instruments with an original maturity of less than three months.
Intangible assets
The cost of intangible assets is amortized using the straight line method
over the estimated useful economic life (five years for organization costs).
They are stated at cost less accumulated amortization. The Company reviews for
the impairment of long-lived assets and certain identifiable intangibles
whenever events or changes in circumstances indicate that the carrying value
of the asset may not be recoverable. An impairment loss would be recognized
when estimated future cash flows expected to result from the use of the asset
and its eventual disposition is less than its carrying amount. No such
impairment losses have been identified in the periods presented.
Net loss per share
Basic loss per share is computed by dividing the net loss for the period by
the weighted average number of common shares outstanding for the period.
Common stock equivalents are excluded from the computation as their effect
would be anti-dilutive. Shares issued at inception are considered to be
outstanding for the entire period presented.
Use of estimates
The preparation of the Company's financial statements requires management to
make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ from
these estimates.
<PAGE>
MAS Acquisition III Corp.
(A Development Stage Company)
Notes to Financial Statements
As of December 31, 1998
(Continued)
Note 2. STOCKHOLDERS' EQUITY
At inception the Company issued 8,500,000 shares of its $.001 par value common
stock to an officer as reimbursement of organization costs paid by the officer.
Fair value used for this transaction of $90 is based upon the actual cost of
incorporation.
During January, 1997 the Company issued 500 shares of its $.001 par value
common stock to directors as compensation valued at $1.
During March, 1997 the Company issued 3,100 shares of its common stock to 31
foreign citizens as a gift with an aggregate fair value of $3.
During September, 1998 the Company issued 2,070 shares of its common stock to
foreign citizens as a gift with an aggregate fair value of $2.
Note 3. INCOME TAXES
Deferred income taxes may arise from temporary differences resulting from
income and expense items reported for financial accounting and tax purposes in
different periods. Deferred taxes are classified as current or non-current,
depending on the classifications of the assets and liabilities to which they
relate. Deferred taxes arising from temporary differences that are not related
to an asset or liability are classified as current or non-current depending on
the periods in which the temporary differences are expected to reverse. The
deferred tax asset related to the operating loss carryforward has been fully
reserved.
The Company's net operating loss carryforwards expire in 2011 through 2013.
<PAGE>
ITEM 8. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
<PAGE>
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
OFFICERS AND DIRECTORS
The following table sets forth certain information concerning
each of the Company's directors and executive officers:
<TABLE>
<CAPTION>
<S> <C> <C>
Name Age Position
Aaron Tsai 29 Chairman of the Board, President, Chief
Executive Officer, and Treasurer
Chia-Lun Tsai 53 Vice President and Director
</TABLE>
Aaron Tsai has previously served as President, Chief Executive
Officer, Treasurer and as a Director of the Company since inception
and is serving the same positions since August 7, 1998. Mr. Tsai is
President and Director of MAS Financial Corp., Aimex Camera Corp.,
Aimex Distributing Corp., Aimex Marketing Corp., American Multimedia,
Inc., Aimex Imaging Corp. and Auto Stack Pacific Rim Ltd. Mr. Tsai is
Vice President and Director of Hunan Restaurant of Indiana, Inc. and
Hunan Restaurant of Boonville, Inc. Mr. Tsai was President and Director
of Aimex International Corporation, Aimex Camera (HK) Limited, Aimex
Capital/Finance, Ltd. and Multi Access Systems, Inc. Mr. Tsai has
served as President, Chief Executive Officer and a Director of Aimex
Camera Inc.
Mr. Chia-Lun Tsai has previously served as Vice President and a
Director of the Company since inception and is serving the same positions
since August 7, 1998. Mr. Tsai is a Director of MAS Financial Corp.
since August 1995 and Aimex Camera Corp. since December 1996. Mr. Tsai
is owner and manager of Hunan Restaurant of Indiana, Inc. and Hunan
Restaurant of Boonville, Inc. Mr. Tsai was an owner and manager of Hunan
Restaurant from 1986 until 1993. Mr. Tsai was Vice President and a
Director of Aimex International Corporation and Aimex Camera Inc.
The blank check companies that Aaron Tsai served as President and
Director and Chia-Lun Tsai served as Vice President and Director are
MAS Acquisition I Corp., MAS Acquisition II Corp., MAS Acquisition IV
Corp., MAS Acquisition V Corp., MAS Acquisition VI Corp., MAS Acquisition
VII Corp., MAS Acquisition VIII Corp., MAS Acquisition IX Corp., MAS
Acquisition X Corp., MAS Acquisition XI Corp., MAS Acquisition XII Corp.,
MAS Acquisition XIII Corp., MAS Acquisition XIV Corp., MAS Acquisition XV
Corp., MAS Acquisition XVI Corp. and Multi Access Systems, Inc.
In December 1997 MAS Acquisition I Corp. merged with Sloan Electronics,
Inc. and renamed to Sloan Electronics, Inc. and in October 1997 MAS
Acquisition II Corp. renamed to ThermoTek Environmental, Inc. Both Sloan
Electronics, Inc. and TermoTek Environmental Inc. are under control of new
controlling persons. On July 25, 1997, MAS Acquisition IV Corp. was renamed
Aimex Distributing Corp. and on July 25, 1997, MAS Acquisition V was renamed
Aimex Marketing Corp. Both Aimex Distributing Corp. and Aimex Marketing Corp.
markets and distributes cameras and are no longer blank check companies. Mr.
Aaron Tsai is President, Director and the principle shareholder of Aimex
Marketing Corp. and Aimex Distributing Corp.
<PAGE>
PRIOR BLANK CHECK OFFERINGS
Mr. Aaron Tsai was involved in a number of blank check offerings
described below. On September 11, 1996, Multi Access Systems Inc. gifted
23,600 shares of its common stock in reliance on Regulation S to non-U.S.
persons for the purpose of increasing the number of shareholders. Multi Access
Systems Inc. has not merged with or acquired any business. Mr. Aaron Tsai is
the principle shareholder of MAS Acquisition II Corp., MAS Acquisition IV Corp.,
MAS Acquisition V Corp., MAS Acquisition VI Corp., MAS Acquisition VII Corp.,
MAS Acquisition VIII Corp., MAS Acquisition IX Corp., MAS Acquisition X Corp.,
MAS Acquisition XI Corp., MAS Acquisition XII Corp., MAS Acquisition XIII
Corp., MAS Acquisition XIV Corp., MAS Acquisition XV Corp. and MAS
Acquisition XVI Corp. and in March 1997 each of these companies gifted
3,100 shares of its common stock, respectively, in reliance on Regulation S
to non-U.S. persons for the purpose of increasing the number of shareholders.
In September 1998 MAS Acquisition VI Corp. gifted 3,070 shares of its common
stock in reliance on Regulation S to non-U.S. persons for the purpose of
increasing the number of shareholders.
Mr. Chia-Lun Tsai is the father of Mr. Aaron Tsai.
The Officers and Directors identified in above table are the Company's
only promoters.
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION.
None of the Company's current officers or directors receive
any compensation for their respective services rendered unto the
Company, nor have they received such compensation in the past.
They all have agreed to act without compensation until authorized
by the Board of Directors, which is not expected to occur until the
Company has generated revenues from operations after consummation
of a merger or acquisition. The Company currently has no funds
available to pay officer or directors. Further, none of the officer
or directors are accruing any compensation pursuant to any agreement
with the Company.
It is possible that, after the Company successfully
consummates a merger or acquisition with an unaffiliated entity,
that entity may desire to employ or retain one or a number of
members of the Company's management for the purposes of providing
services to the surviving entity, or otherwise provide other
compensation to such persons. However, the Company has adopted a
policy whereby the offer of any post-transaction remuneration to
members of management will not be a consideration in the Company's
decision to undertake any proposed transaction. Each member of
management has agreed to disclose to the Company's Board of
Directors any discussions concerning possible compensation to be
paid to them by any entity which proposes to undertake a
transaction with the Company and further, to abstain from voting on
such transaction. Therefore, as a practical matter, if each member
of the Company's Board of Directors is offered compensation in any
form from any prospective merger or acquisition candidate, the
proposed transaction will not be approved by the Company's Board of
Directors as a result of the inability of the Board to
affirmatively approve such a transaction.
It is possible that persons associated with management may
refer a prospective merger or acquisition candidate to the Company.
In the event the Company consummates a transaction with any entity
referred by associates of management, it is possible that such an
associate will be compensated for their referral in the form of a
finder's fee. It is anticipated that this fee will be either in
the form of restricted common stock issued by the Company as part
of the terms of the proposed transaction, or will be in the form of
cash consideration. However, if such compensation is in the form
of cash, such payment will be tendered by the acquisition or merger
candidate, because the Company has insufficient cash available.
The amount of such finder's fee cannot be determined as of the date
of this registration statement, but is expected to be comparable to
consideration normally paid in like transactions. No member of
management of the Company will receive any finders fee, either
directly or indirectly, as a result of their respective efforts to
implement the Company's business plan outlined herein.
The Company plans to compensate Aaron Tsai, President of the
Company between 800,000 to 1,500,000 shares of Common Stock of the
Company for his services in connection with completion of an
acquisition or merger. The Company does not intend to compensate any
other Officers and Directors of the Company or consultants in
connection with completion of an acquisition or merger in any form
other than in form of Common Stock to the President of the Company
and in form of finders fee to the consultant(s).
No retirement, pension, profit sharing, stock option or
insurance programs or other similar programs have been adopted by
the Company for the benefit of its employees.
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT.
PRINCIPLE STOCKHOLDERS
The following table sets forth certain information as of December
31, 1998 regarding the beneficial ownership of the Company's Common
Stock by (i) each stockholder known by the Company to be the
beneficial owner of more than 5% of the Company's Common Stock, (ii)
by each Director and executive officer of the Company and (iii) by
all executive officer and Directors of the Company as a group. Each
of the persons named in the table has sole voting and investment
power with respect to Common Stock beneficially owned.
<TABLE>
<CAPTION>
Number of Percentage of
Name and Address Shares Owned Shares owned
<S> <C> <C>
Aaron Tsai 8,500,000 99.93%
c/o MAS Acquisition III Corp.
1710 E. Division St.
Evansville, IN 47711
Chia-Lun Tsai 0 *
c/o MAS Acquisition III Corp.
1710 E. Division St.
Evansville, IN 47711
All Directors & Officers 8,500,000 *
as a group (2 persons)
</TABLE>
* Less than 1%
<PAGE>
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
There have been no related party transactions, or any other
transactions or relationships required to be disclosed pursuant to
Item 404 of Regulation S-B.
<PAGE>
PART IV
ITEM 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
REPORTS ON FORM 8-K.
(a) Financial Statements are contained in Item 7.
(b) Reports on Form 8-K
No reports on Form 8-K have been filed during the last quarter of
the period covered by this report.
(c) Exhibits.
(3.1) Articles of Incorporation as filed with the Form
10-SB Registration Statement on September 16, 1998.
(3.2) Bylaws of the Company as filed with the Form
10-SB Registration Statement on September 16, 1998.
(4.1) Specimen Common Stock Certificate
<PAGE>
Specimen Common Stock Certificate
NUMBER SHARES
MAS Acquisition III Corp.
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
PAR VALUE $0.001
COMMON STOCK
THIS CERTIFIES THAT
is the owner of
FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK PAR VALUE OF
$0.001 EACH OF
MAS Acquisition III Corp.
transferable on the books of the Corporation in person or by duly authorized
attorney upon surrender of this Certificate properly endorsed.
Witness the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.
DATED:
MAS
ACQUISITION
III CORP.
--------------
CORPORATE SEAL
--------------
PRESIDENT DELAWARE SECRETARY
<PAGE>
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - _____ Custodian ______
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN(J/T) - as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act ______________________
in common (State)
Additional abbreviations may also be used though not in the above list.
For Value Received ___________________________________ hereby sell, assign and
transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
_______________________________________________________________________________
_______________________________________________________________________________
__________________________________________________________________________Shares
of the Capital stock represented by the within Certificate, and do hereby
irrevocably constitute and
appoint ________________________________________________________________Attorney
to transfer the said Stock on the books of the within-named Corporation with
full power of substitution in the premises.
Dated _________________________
X______________________________________
SIGNATURE GUARANTEE ______________________________________
(BY BANK, BROKER, CORPORATE OFFICER) NOTICE: THE SIGNATURE TO THIS
AGREEMENT MUST CORRESPOND WITH THE
NAME AS WRITTEN UPON THE FACE OF THE
CERTIFICATE, IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT, OR
ANY CHANGE WHATEVER.
Exhibit (4.1)
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
MAS ACQUISITION III CORP.
Date: January 18, 1999
By: /s/ Aaron Tsai
__________________________________
Aaron Tsai
President, Chief Executive Officer
Treasurer and Director
Date: January 18, 1999
By: /s/ Chia-Lun Tsai
_________________________________
Chia-Lun Tsai
Vice President and Director
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Balance Sheet at December 31, 1998 and the Statement of Operations for the
year ended December 31, 1998 and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 45
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 96
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 45
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 20
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (20)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (20)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
