Amendment No. 1
FORM 10-KSB
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[ ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED
JUNE 30, 2000
OR
[X] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED] for the transition period from
INCEPTION to JUNE 30, 2000
Commission file number: 000-25019
PVAXX CORPORATION
(Name of small business issuer in its charter)
COLORADO 000-25019 05-0499528
--------------- --------------------- -------------------
(State of (Commission File No.) (IRS Employer ID No.)
Incorporation)
1250 Turks Head Building
Providence, RI 02903
401-272-5800
--------------------------------------------------
(Address of Principal Executive Offices)
NADEAU & SIMMONS, P.C.
1250 TURKS HEAD BUILDING
PROVIDENCE, RI 02903
401-272-5800
--------------------------------------------------
(Name and Address of agent for service)
<PAGE>
Securities registered pursuant to Section 12(b) of the Securities
Exchange Act:
Title of each class Name of each exchange
on which registered
Not Applicable NONE
Securities registered pursuant to section 12(g) of the Securities
Exchange Act:
COMMON STOCK,
NO PAR VALUE PER SHARE NASD
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the 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 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:
$ 0.00
The aggregate market value of the 16,633,815 shares of Common Stock held by
non-affiliates was $159,276 as of June 30, 2000. For purposes of the
foregoing calculation only, each of the issuer's officers and directors is
deemed to be an affiliate. The market value of the shares was calculated
based on the book value of such shares on such date.
As of June 30, 2000, 21,322,800 shares of the issuer's Common Stock
were outstanding.
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE:
The following documents are following by reference into the annual
report:
a)-1. PVAXX Corporation's Form 10-QSB, filed August 14, 2000 for the
quarter ending June 30, 2000;
PVAXX Corporation's Form 8-K, filed July 11, 2000;
Oak Brook Capital IV, Inc.'s Form 10-QSB, filed December 22, 1999
for the quarter ending September 30, 1999;
Oak Brook Capital IV, Inc.'s Form 10-QSB/A, filed October 19, 1999 for
the quarter ending June 30, 1999;
Oak Brook's Form 10-QSB, filed August 13, 1999 for the quarter ending
June 30, 1999;
Oak Brook's Form 10-QSB/A, filed July 30, 1999 for the quarter ending
March 31, 1999;
Oak Brook's Form 10-QSB, filed May 18, 1999 for the quarter ending
March 31, 1999;
all other reports filed pursuant to section 13(a) or 15(d) since the end of
the year covered by the above annual reports.
(a)-2. All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934, as amended, subsequent to the
date hereof and prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which
de-registers all securities covered hereby then remaining unsold shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of filing of such documents, except as to any portion of any future
Annual or Quarterly Report to Stockholders which is deemed to be modified or
superseded for purposes of this Registration Statement to the extent that such
statement is replaced or modified by a statement contained in a subsequently
dated document incorporated by reference or contained in this Registration
Statement.
(a)-3 The description of the Company's common stock which is contained in the
Form 10SB12G, Registration Statement filed under Section 12 of the Securities
Exchange Act of 1934, including any amendments or reports filed for the
purpose of updating such description.
Transitional Small Business Disclosure Format: Yes [ ] No [X]
<PAGE> 1
PART I
ITEM 1. DESCRIPTION OF BUSINESS
BUSINESS DESCRIPTION
IMPORTANT FACTORS RELATED TO
FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS
The statements contained in this report that are not purely historical are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act") and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), including
statements regarding the Company's expectations, hopes, intentions or
strategies regarding the future. All forward-looking statements included
herein are based on information available to the Company on the date hereof,
and the Company assumes no obligation to update any such forward-looking
statements. It is important to note that the Company's actual results could
differ materially from those in such forward-looking statements. Among the
factors that could cause actual results to differ materially are the risk
factors which may be listed from time to time in the Company's reports on Form
10-QSB, 10-KSB and registration statements filed under the Securities Act.
Forward-looking statements encompass the (i) expectation that the Company can
secure additional capital, (ii) continued expansion of the Company's
operations through joint ventures and acquisitions, (iii) success of existing
and new marketing initiatives undertaken by the Company, and (iv) success in
controlling the cost of services provided and general administrative expenses
as a percentage of revenues.
The forward-looking statements included herein are based on current
expectations that involve a number of risks and uncertainties.
These forward-looking statements were based on assumptions that the Company
would continue to expand, that capital will be available to fund the Company's
growth at a reasonable cost, that competitive conditions within the industry
would not change materially or adversely, that demand for the Company's
services would remain strong, that there would be no material adverse change
in the Company's operations or business, and that changes in laws and
regulations or court decisions will not adversely or significantly alter the
operations of the Company. Assumptions relating to the foregoing involve
judgments with respect to, among other things, future economic, competitive,
regulatory and market conditions, and future business decisions, all of which
are difficult or impossible to predict accurately and many of which are beyond
the control of the Company. Although the Company believes that the
assumptions underlying the forward-looking statements are reasonable, any of
the assumptions could prove inaccurate and, therefore, there can be no
assurance that the forward-looking information will prove to be accurate.
<PAGE> 2
In light of the significant uncertainties inherent in the forward-looking
information included herein, the inclusion of such information should not be
regarded as a representation by the Company or any other person that the
objectives or plans of the Company will be achieved.
Nature of Activities
PVAXX CORPORATION is the parent company of the PVAXX group of companies. The
PVAXX CORPORATION group consists of:
-PVAXX Technologies Ltd, which holds patents and intellectual property;
-PVAXX Research & Development Ltd, the company undertaking all ongoing trials
and developments, which also does business as PVAXX Engineering, which
designs and manufactures all of our machinery;
-PVAXX Soft Cap Systems which manufactures and supplies capsule making
machinery; and
-PVAXX Europe, Ltd which is a dormant company with no operations.
The Company recently took possession of a newly built European HQ in England
near Malmesbury in Wiltshire, which includes:
-3000 square feet sales offices;
-2000 square feet engineering departments;
-2000 square feet development labs; and
-4000 square feet manufacturing areas.
The Product
PVAXX is a completely biodegradable polymer. We believe PVAXX represents a
genuine advance in polymer technology. Management feels that PVAXX will be a
significant contributor to the reduction of negative environmental and
ecological impacts of plastics. PVAXX offers the potential of practical
solutions to worldwide waste disposal problems, as all products manufactured
from PVAXX biodegrade into non-toxic elements when disposed of through water
immersion or in landfill.
<PAGE> 3
PVAXX is a newly formulated polymer, created by a patented process and
manufactured from the chemical raw material Polyvinyl Alcohol 'pva' and other
food-grade additives, which have been used in consumer markets for over 25
years. Thus its properties, both physical and toxicological, as well as its
environmental impact from its bio-degradation on disposal, have been studied
in depth.
PVAXX, is a stable, flexible polymer similar to other everyday polymers. It is
available in various grades suitable for most product areas. PVAXX production
consumes a very low level of energy as no external heat is introduced,
creating potentially greater environmental advantages. PVAXX is significantly
less expensive than other biodegradable polymers currently in the market.
Production
PVAXX specialized polymers are already in production. Product is currently
being shipped in 50 Kilo drums to various potential customers at a price of
$1,200 per ton. Although the Company provides samples of potential
applications accompanying the PVAXX polymer shipment, prospective customers
are responsible to complete their own trials and tests to determine whether
PVAXX will be suitable for production of their products. If suitable, PVAXX
may be used to enable the customer to produce products such as film, sheet,
wrapping and packaging materials, fibers and mouldings with no toxic effects
on the environment at an affordable cost.
The various technologies that make up PVAXX were either acquired by or
developed within PVAXX Group. Development was undertaken within the Irish
Government Research and Development Department, PERA, Leeds University and
University of North London and within our own facilities both in England and
in the Isle of Man. These entities have a wide range of experience in the
development of laboratory led research and testing of polymers and plastic
processes and products. More than a decade of associated research and over
five years of laboratory and industrial assessment has gone into the
development of PVAXX. This includes full industrial, scientific and technical
assessment throughout its development.
PVAXX offers biodegradability at a cost that is competitive when compared with
other plastics. Alternative products based on starch additives, fragment, but
may not decompose. Those polymers that do biodegrade are generally expensive
and can be difficult to process.
Target Market
PVAXX is a competitively priced material thus it can be used by the customer
to manufacture basic and premium products. These include, but are not limited
to, the following areas listed together with some consumption examples.
-Agricultural Agro-chem sachets, Mulch films, Plant pots Household Bags,
Diapers, Drinking straws, Femcare products, Hangers, Incontinence pads,
Sachets, Six pack rings Industrial Chemical sachets, Disposable clothing,
Expanded foams, Gloves.
<PAGE> 4
-Leisure Film canisters, Golf tees, Shotgun cartridges Medical Bedpans, Bowls,
Cotton buds, Hospital curtains, 'One-use' sterile products, capsules.
PVAXX has been test marketed using a UK chemical/polymer distributor, enabling
the Company to refine such things as packaging, grades and pricing. The
manufacturing division is currently capable of producing up to 10,000 tons per
annum of PVAXX. Management believes the Company has the ability to
manufacture further production capacity to increase production by a further
20,000 tons per annum every 14 weeks when required. The raw materials used to
produce PVAXX are all sourced from the major manufacturers such as, Nippon
Gohsei, Omya, ECC, Chang Cheung, Unichema , Jordan Carbonate, etc.
Sales and Marketing
Markets
Eight percent of US household waste, over 13 million tons per year, is made up
of plastics and is consigned to landfill. This is repeated throughout the
developed world.
"....studies now confirm only 20 per cent of plastic waste could be
recycled.." said Mr. Reg. McCabe director of the Plastics Industries
Association of Ireland......in the light of growing public concern about
additional landfill sites.....business called on Government to help out with
136,000 tons of plastic packaging waste which are produced each year... PERA
has completed a detailed market study for the Company showing an immediate
market of 30 million tons in areas where PVAXX is cheaper or has other
attributes that make it immediately superior to current polymers being used
on the market today.
Marketing Plan
Management believes the Company offers a solution to customers and policy
makers by offering the option of an environmentally friendly polymer such as
PVAXX.
Press, Public Relations and Lobbying
Given the range of applications in all kinds of sectors in many parts of the
world, Management feels the public relations potential for PVAXX is
significant. The Company is beginning to create a multi language media
relations program embracing both trade and technical media, together with
national newspapers and magazines in appropriate sectors, such as food,
fashion, pharmaceuticals etc.
Recent production of PVAXX has presented the opportunity for a media event in
which we can effectively demonstrate the biodegradability of PVAXX. We can
also supply all media and key people we target with a small case of samples
that enables them to carry out their own experiments.
<PAGE> 5
Environmental attributes such as complete biodegradability are regularly
sought after by industry and policy makers especially due to plastic related
issues such as:
-Low environmental rating from cradle to grave;
-Endocrine mimicry; and
-Waste and packaging problems including landfill over capacity, incineration
and dioxin issue, take back requirements, recycling requirements, agricultural
leaching etc.
Due to new research on phthalates and similar plastics that can cause
endocrine mimicry, policy makers are looking at substitutes for such plastics
to justify a ban. In addition, governments are also looking to find solutions
to the high volumes of plastic waste accumulating in their landfills, the
toxicity problems of plastic residue in soil, groundwater or via leaching
directly into foodstuffs, and to the dioxin emissions when plastics are
burned. These issues have led to interim solutions such as recycling, take
back policies etc., but policy makers believe that the ultimate solution
remains the complete biodegradability of plastics.
Marketing Strategy
In order to properly inform policy makers of the existence and benefits of
PVAXX, Management intends to employ a two-tiered approach as follows:
(i) First, all relevant actors at the senior government level will be
personally informed of the environmental attributes of PVAXX. As the debate
on plastic products and waste develops, PVAXX must be seen developing in a
pro-active industry producing a new, environmentally safe product;
Provided the Company convinces officials through sound research, development
and environmental proof, new legislation adopted in its favor will likely be
forthcoming, so long as the informing process has been conducted in a
professional and diplomatic manner; and
(ii)Second, local and state governments and local authorities must also be
approached.
Throughout the entire informational process, new elements or developments must
be integrated into the strategy and used to influence each actor. In addition,
we hope to forge alliances with parties also interested in changing national
legislation to benefit cleaner plastics. These parties could be industry
federations or representatives as well as respected non-governmental
organizations.
<PAGE> 6
Interactive Website
A live website, initially cast in 5 languages, with an active inquiry office
and updateable news section, is available as part of our marketing strategy.
The selling of PVAXX via the Internet, supported by our technical centre at
www.pvaxx.com, provides 24-hour access to sales and technical information.
PVAXX has already started to appoint polymer and chemical distribution agents,
therefore increasing active promotion of PVAXX worldwide.
There is no advertising on our web site, nor are we entertaining potential
advertising at this time. Accordingly, the Company has not been involved in
the negotiation of preliminary agreements or understandings with any
advertisers.
Profile Document
We plan to produce a publication about PVAXX and the environment. It is
reflective of the website; but will be presented specifically for individuals
who influence the purchase of plastics.
Advertising
Through advertising, the Company has an opportunity to gain exposure both to
potential purchasers and those who can influence purchases. Media coverage of
the Company will provide useful additional advertising for the product. We
intend to place announcements of our product development in the FT, the Wall
Street Journal, Paris Match etc. together with product advertisements in
magazines in sectors such as food and drink, pharmaceuticals, etc.
Advertising Expenditure
We have budgeted approximately $160,000 for advertising with a possible growth
from earnings to $800,000. We hope to have good exposure that will enable us
to put PVAXX forward as a visible global brand. Of course, there can be no
assurances that such advertising budget can be generated through the offering,
internal operations or growth from earnings.
Competitive and Environmental Issues
General
The biodegradable plastics industry in which the Company operates is highly
competitive. Some of the company's principal competitors in certain business
lines are substantially larger and better capitalized than the Company.
Because of these resources, these companies may be better able than the
Company to obtain new customers and to pursue new business opportunities or
to survive periods of industry consolidation.
<PAGE> 7
Plastics have considerable utility but also result in significant amounts of
waste--both during manufacture and following their use as products.
Unfortunately this waste has a highly visible profile which, combined with its
indefinite lifespan, does not allow the problem to diminish. As environmental
issues become increasingly voiced, the use and disposal of traditional plastic
materials (which currently are non biodegradable,) are becoming a cause for
concern. Public opinion, i.e. regarding the threat to the environment, has
caused the European Union to outline quality standards for products,
production standards and pollution levels which will enable countries within
the EU to tighten their legislation.
Incineration
Apart from requiring considerable amounts of energy, incineration will also
produce vast quantities of gases, contributing to the 'greenhouse effect'.
PVC, one of the commonest pollutants, when combusted produces hydrogen
chloride, requiring expensive materials in the construction of incinerators
along with downstream acid gas scrubbing equipment. Overall, incineration is
expensive and creates further pollution.
Landfill
Land fill sites are expensive in terms of construction and management and tie
up valuable land for indefinite periods. They are filling up and closing at a
high rate so reducing the number of available sites.
Recycling
Recycling requires the physical separation on each waste site of all plastic
from non plastic material. This process then has to be followed by the
attempted sorting and segregation of different types of plastic from each
other, without the benefit of chemical analysis. Next, the waste is
transported to the recycling site for treating and re-analyzing before
re-inclusion into a manufacturing process.
Recycling is a time consuming and expensive task that is open to accidental
miss-sorting and subsequent abortive processing. To quote the British Plastics
Federation Statistics Handbook:-"the problem for industry is that reprocess
feedstocks are often of inconsistent quality and there remain concerns about
incorporating reclaimed material into food or technical applications."
The problem is not confined to Western Europe. In the USA, where household
waste stands at 190 million tons per annum, thirteen million of this
represents plastic products which are delivered to landfill. Because of such
pollution issues Japan now exports its waste and countries like Canada,
Australia and France are in a similar position.
<PAGE> 8
Other Degradable Polymers
Many plastics are now being marketed, at least partially, on their
environmental merits. This may be for very different reasons based upon the
following list of some degradable polymer manufacturers being divided into
Synthetic polymers, Starch-based polymers, Biopolymers and Biocompostibles as
follows:
Synthetic Polymers
-Carbonnages de France - have developed a polyurethane material used for
mortuary shrouds.
-Union Carbide - have developed Caprolactone polyester for tree seedling
containers.
Starch-based Polymers
-Warner-Lambert, USA. - 'Novon' product claimed to be suitable as a
replacement for PS and PE in disposable product applications e.g. injection
moulding of pharmaceutical capsules.
Biopolymers
(Plastic materials produced by micro-organisms)
-Monsanto, England - 'Biopol' (predominately polyhydroybutyrate)--promoted as
'Nature's Plastic'. Basically a thermoplastic linear polyester used for
bottles and mouldings. This relatively stiff material produced by biological
fermentation of sugars to produce carbohydrates from which 'Biopol' is
manufactured. Fully biodegradable.
Biocompostibles
(standard plastics with a starch additive)
-There are many companies in this category, but as only the starch additive
biodegrades and the starch loaded derivatives do not fully biodegrade, they
leave small particles of undegraded polyethylene, or other polymer and cause
ecological dangers which have been under investigation.
ITEM 2. DESCRIPTION OF PROPERTY
Administrative Offices
Our corporate headquarters are located at 12730 New Brittany Boulevard, Ft.
Myers, Florida 33907, (941) 274-9355. Our transfer agent is Our transfer
agent is Computershare Trust Company, 12039 West Alameda Parkway, Suite Z-2,
Lakewood CO 80228, telephone: (303) 986-5400.
<PAGE> 9
The Company executed a 3-Year Lease Agreement on May 23, 2000 with S.W.
Enterprise Associates, Inc. to cover the 2,491 square foot corporate
headquarter location. The Lease Agreement expires on May 31, 2003 and
contains the following payment terms:
Year 1
Quarter Base Rent CAM Tax Monthly
1st Qtr. $ 6,000.00 $ 4,387.50 $ 623.25 $ 3,670.25
2nd Qtr. $ 6,000.00 $ 3,887.50 $ 623.25 $ 3,670.25
3rd Qtr. $ 7,150.00 $ 4,390.00 $ 695.50 $ 4,095.13
4th Qtr. $ 8,100.00 $ 4,390.00 $ 749.50 $ 4,163.33
Year 2 $ 33,695.00 $ 18,262.40 $ 3,118 $ 4,589.55
Year 3 $ 35,043.84 $ 18,992.90 $ 3,242 $ 4,773.25
ITEM 3. LEGAL PROCEEDINGS
No material legal proceedings to which the Company (or any of its directors
and officers in their capacities as such) is party or to which property of
the Company is subject is pending and no such material proceeding is known by
management of the Company to be contemplated.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable
<PAGE> 10
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There has been no public trading market for the Company's Common Stock.
Holders of Common Stock are entitled to receive such dividends as may be
declared by the Company's Board of Directors. No dividends on the Common
Stock have been paid by the Company, nor does the Company anticipate that
dividends will be paid in the foreseeable future.
ITEM 6. SELECTED FINANCIAL DATA
Not applicable
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OR
PLAN OF OPERATION
The following discussion should be read in conjunction with the Financial
Statements and notes thereto.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
June 30, 2000
=====================================
YEAR ENDING JUNE 30, 2000
=====================================
Except for historical information, the discussion in this Form SB-2 contains
forward-looking statements that involve risks and uncertainties. These
statements may refer to the Company's future plans, objectives, expectations
and intentions. These statements may be identified by the use of words such as
"expect", "anticipate", "believe", "intend", "plan" and similar expressions.
The Company's actual results could differ materially from those anticipated in
such forward-looking statements. Factors that could contribute to these
differences include, but are not limited to, the risks discussed in the
section titled "Market Risks and other Business Factors" later in this Form
SB-2.
<PAGE> 11
Plan of Operation
The Company is producing a range of biodegradable polymers that may assist
various customers produce agricultural, pharmaceutical, adhesives and food
market products. The Company has spent the past several years developing its
technology and is now delivering polymer for various customers operating in
the following industries:
-Pharmaceutical;
-Industrial;
-Retail;
-Household;
-Agricultural;
-Leisure and Distributors.
Next 12 Months of Operations
(i) We intend to appoint a global distributor and ship significant production
quantities to customers late in the first quarter of 2001. Average selling
prices will be $1,200 per ton for non-pharmaceutical grade and $9,000 per ton
for pharmaceutical grade. Should the company need additional financing prior
to achieving greater levels of sales, the President and majority shareholder
may contribute additional capital to the company, or the company may decide to
raise capital through the sale of equity. The Company will have the ability
to increase its production capacity 10,000 tons with every $1,000,000 raised
in connection with this offering. Presently, the Company has the ability to
produce 10,000 tons at its facility located at Kemble Business Park, Nr
Malmesbury, Wiltshire, UK.
(ii) We have completed all necessary product research and development needed
to perform during the next 12 months. PVAXX specialized polymers are already
in production. Product is being shipped in 50 Kilo drums to various
potential customers. Although the Company provides samples of potential
applications accompanying the PVAXX polymer shipment, prospective customers
are responsible to complete their own trials and tests to determine whether
PVAXX will be suitable for production of their products. If suitable, PVAXX
may be used to enable the customer to produce products such as film, sheet,
wrapping and packaging materials, fibers and mouldings with no toxic effects
on the environment at an affordable cost;
<PAGE> 12
(iii) We anticipate establishing an additional production facility in Dubai,
UAE that will have the ability to produce 10,000 tons of PVAXX with every
$1,000,000 raised in connection with this offering. The purchase and/or lease
of significant equipment in connection with this facility is fully factored
into the production of 10,000 tons for every $1,000,000 raised; and
(iv) We do not expect significant changes in the number of employees.
All PVAXX components have received EU and FDA approval for human consumption,
via pharmaceuticals or food, allowing e.g. gelatine replacement in drug
capsules and fertilizer and seed coatings.
We anticipate initial sales will be to the Italian market, where new
legislation to ban a number of plastic applications is currently in the
implementation phase. A development partner in each market sector has been
identified and these customers will receive first deliveries. The pharma
sector is being developed over the mid-term, and offers higher-margin
opportunities. A PVAXX consumer awareness program will be also be implemented
during this period, and a trade marketing program will support the
distributor sales effort.
Liquidity and Capital Resources
The Company remains in the development stage and, since inception, has
experienced no significant change in liquidity or capital resources or
stockholder's equity. The Company's balance sheet as of June 30, 2000,
reflects a current asset value of $441,589, and a total asset value of
$1,225,804 in the form of cash and capitalized organizational costs.
The Company is hereby registering for the sale of equity in connection with
the sale of 2,400,000 shares at approximately $10.00/share. The Company does
not have any underwriting commitments for such sale of equity and cannot
provide assurances that it will raise significant proceeds from this offering
and may receive no or nominal proceeds, significantly restricting the
Company's activities and plan of operations.
<PAGE> 13
Notwithstanding the steps taken by us to raise additional capital, our
immediate cash requirements are significant. We cannot assure you that we will
be able to successfully realize cash flow from operations or that such cash
flow will be sufficient. We believe that our existing and anticipated capital
resources will enable us to fund our planned operations through Fiscal 2001.
In addition, our annual and quarterly operating results may be affected by a
number of factors, including the following:
- our ability to manage inventories, shortages of components or labor;
- the degree of automation used in the assembly process;
- fluctuations in material costs and the mix of material costs versus labor;
- manufacturing and overhead costs;
- price competition;
- the inability to pass on excess costs to customers;
- the timing of expenditures in anticipation of increased sales; and
- customer product delivery requirements.
Any one of these factors, or a combination thereof, could adversely affect us.
The Company believes that obtaining $1,000,000 of net proceeds from this
offering will permit it to continue meeting its working capital obligations
and fund the further development of its business for at least the next 12
months that will allow for an increase in production of not less than 10,000
tons of PVAXX. There can be no assurance that any additional financing will be
available to the Company on acceptable terms, or at all. If adequate funds are
not available, the Company may be required to delay, scale back or eliminate
its research, engineering and development or manufacturing programs or obtain
funds through arrangements with partners or others that may require the
Company to relinquish rights to certain of its technologies or potential
products or other assets. Accordingly, the inability to obtain such financing
could have a material adverse effect on the Company's business, financial
condition and results of operations.
Evolving Industry Standards; Rapid Technological Changes
The Company's success in its business will depend in part upon its continued
ability to enhance its existing products, to introduce new products quickly
and cost effectively to meet evolving customer needs, to achieve market
acceptance for new product offerings and to respond to emerging industry
standards and other technological changes. There can be no assurance that the
Company will be able to respond effectively to technological changes or new
industry standards. Moreover, there can be no assurance that competitors of
the Company will not develop competitive products, or that any such
competitive products will not have an adverse effect upon the Company's
operating results. There can also be no assurance that the Company will be
successful in refining, enhancing and developing its operating strategies and
products going forward, that the costs associated with refining, enhancing and
developing such strategies and products will not increase significantly in
future periods or that the Company's existing technology will not become
obsolete as a result of ongoing technological developments in the marketplace.
<PAGE> 14
Volatility of Stock Price
The Company believes factors such as the Company's liquidity and financial
resources, quarter to quarter and year-to-year variations in financial results
could cause the market price of the Company's common stock to fluctuate
substantially. Any adverse announcement with respect to such matters or any
shortfall in revenue or earnings from levels expected by management could
have an immediate and material adverse effect on the trading price of the
Company's common stock in any given period. As a result, the market for the
Company's common stock may experience material adverse price and volume
fluctuations and an investment in the Company's common stock is not suitable
for any investor who is unwilling to assume the risk associated with any such
price and volume fluctuations.
Sufficiency of Cash Flows
The Company believes that current cash balances and any cash generated from
operations and from available debt or equity financing will be sufficient to
meet its cash needs for working capital and capital expenditures for at least
the next twelve months. Thereafter, if cash generated from operations is
insufficient to satisfy the Company's liquidity requirements, management may
seek to sell additional equity or obtain credit facilities. The sale of
additional equity could result in additional dilution to the Company's
shareholders. A portion of the Company's cash may be used to acquire or invest
in complementary businesses or products or to obtain the right to use
complementary technologies. From time to time, in the ordinary course of
business, the Company evaluates potential acquisitions of such businesses,
products or technologies.
Results of Operations
No revenues were received by the Company through June 30.
Income Taxes
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes" issued
by the Financial Accounting Standards Board, under which deferred tax assets
and liabilities are provided on differences between the carrying amounts for
financial reporting and the tax basis of assets and liabilities for income tax
purposes using the enacted tax rates. Under SFAS 109, deferred tax assets may
be recognized for temporary differences that will result in deductible amounts
in future periods. A valuation allowance is recognized if on the weight of
available evidence it is more likely than not that some portion or the entire
deferred tax asset will not be realized.
ITEM 8. FINANCIAL STATEMENTS
The financial statements are included beginning at F-2. See page F-1
for the Index to the Financial Statements.
<PAGE> F-1
PVAXX CORPORATION (FORMERLY OAKBROOK CAPITAL IV) & SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
June 30, 2000
The following financial statements include a balance sheet as of June 30,
2000, statements of operations and deficit accumulated during development
stage, statements of changes in stockholders' equity and statements of
cash flows for the years ended June 30, 2000 and 1999 respectively, and
for the period from May 1, 1998 (inception) through June 30, 2000.
PVAXX CORPORATION & SUBSIDIARIES
Index to Financial Statements ...........................1
Report of Independent Auditor ...........................2
Balance Sheet ...........................................3
Statements of Operations & Deficit Accumulated
During Development Stage.................................4
Statements of Changes in Stockholders' Equity ...........5
Statements of Cash Flows ................................6
Notes to Financial Statements ...........................7
<PAGE> F-1
September 20, 2000
Shareholders and Board of Directors
PVAXX CORPORATION
Fort Myers, Florida
REPORT OF INDEPENDENT AUDITOR
We have audited the accompanying balance sheet of PVAXX Corporation
(formerly Oakbrook Capital IV) & Subsidiaries (a development stage
company) as of June 30, 2000, and the related statements of operations
and deficit accumulated during the development stage, changes in
shareholders' equity, and cash flows for the years ended June 30, 2000
and 1999, respectively and for the period from May 1, 1998 (inception)
through June 30, 2000. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of PVAXX
Corporation & Subsidiaries as of June 30, 2000, the results of operations
during the development stage, and its cash flows for the years ended June
30, 2000 and 1999 respectively, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that
the company will continue as a going concern. As discussed in Note #1 to
the financial statements, the Company and all of its subsidiaries are in
a development stage, and have yet to realize any revenue. This raises
substantial doubt about the company's ability to continue as a going
concern. Management's plan in regard to these matters are discussed in
Note #9 The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
/s/ Dennis W. Bersch, CPA
DENNIS W. BERSCH, CPA
Milwaukee, WI
<PAGE> F-2
PVAXX CORPORATION (Formerly Oakbrook IV) & SUBSIDIARIES
(Development Stage Companies)
(With Auditor's Report of September 20, 2000)
BALANCE SHEET
June 30, 2000
ASSETS
------
<TABLE>
<S> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 118,631
Restricted cash and cash equivalents (Note 6) 299,970
VAT tax refund receivable 22,989
----------
Total current assets $ 441,589
FIXED ASSETS:
Machinery & equipment $ 596,851
Office equipment 9,698
Furniture & fixtures 45,496
Motor vehicles 51,648
Less accumulated depreciation (20,000)
----------
Net fixed assets 683,694
OTHER ASSETS:
Prepaid expenses $ 31,469
Deposits 4,349
Patent rights (Note 1) 64,703
----------
Total other assets $ 100,521
----------
Total assets $1,225,804
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 125,667
Current portion of long-term
liabilities (Note 10) 132,446
Accrued wages-officers 180,000
Other accrued liabilities 109,565
----------
Total current liabilities $ 547,678
LONG TERM LIABILITIES:
Notes payable (Note 10) $ 4,427
Capital lease to related parties (Note 10) 516,226
Loans payable to officers/directors (Note 3) 95,971
----------
Total long term liabilities $ 616,624
----------
Total liabilities $1,164,302
(SHAREHOLDERS' EQUITY) (Exhibit 3)
Preferred stock-no par value,
10,000,000 shares authorized, issued
and outstanding $ 100,000
Common stock-no par value, 40,000,000
shares authorized, 21,322,800 issued and
outstanding of which 90,000 shares are in
escrow (Note #6) 204,200
Paid in Capital 217,914
Accumulated other comprehensive income 8,882
Deficit accumulated during the
development stage (469,494)
----------
Total equity 61,502
----------
Total liabilities and equity $1,225,804
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> F-3
PVAXX CORPORATION (formerly Oak Brook Capital IV) and Subsidiaries
(Development Stage Companies)
(With Auditor's Report of September 20, 2000)
STATEMENT OF OPERATIONS AND DEFICIT ACCUMULATED DURING
DEVELOPMENT STAGE
For the years ended June 30, 2000 and 1999 and
from May 1, 1998 (Inception) thru June 30, 2000
<TABLE>
<CAPTION>
September 30, September 30, Since
2000 1999 Inception
<S> <C> <C> <C>
REVENUE $ - $ - $ -
Direct costs - - -
------------ ------------ -----------
Gross Profit $ - $ - $ -
OPERATING EXPENSES
Development costs $ 40,222 - $ 40,222
Finance costs 22,647 22,647
Administrative costs 384,192 - 384,192
------------ ------------ -----------
Total operating expenses 447,061 - $ 457,286
------------ ------------ -----------
Operating income (loss) $ (447,061) - $ (457,286)
OTHER INCOME AND (EXPENSES) (12,208) - (12,208)
------------ ------------ -----------
Net Operating Income (loss) $ (459,269) - $ (469,494)
INCOME TAXES - - -
------------ ------------ -----------
Deficit accumulated during the
development stage $ (459,269) - $ (469,494)
------------ ------------ -----------
PER SHARE INFORMATION
Weighted average number of
common shares outstanding 11,249,356 1,228,000 11,249,356
Profit (loss) per share $ (0.04) - (0.04)
------------ ------------ -----------
Fully diluted shares 21,249,356 - 21,249,356
Profit (loss) per fully diluted
share $ (0.02) - $ (0.02)
------------ ------------ -----------
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE> F-4
PVAXX CORPORATION (formerly Oak Brook Capital IV) and Subsidiaries
(Development Stage Companies)
(With Auditor's Report of September 20, 2000)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
From inception through June 30, 2000
<TABLE>
<CAPTION>
Shares Issued
---------------------
Accumulated
Common Preferred Common Preferred Paid-in Comprehensive Retained
Stock Stock Stock Stock Capital Income Earnings Equity
---------- --------- -------- --------- -------- ------------- --------
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Equity at Inception-
Oakbrook IV - - $ - $ - $ - $ - $ - $ -
Issuance of common stock
for services 5/5/98 1,228,000 - $ 4,200 - - - - 4,200
Net loss for the period - - - - - - (10,225) (10,225)
---------- --------- -------- --------- -------- ------------- ---------- -----------
Balance at 6/30/99 1,228,000 - $ 4,200 $ - $ - $ - $ (10,225) (6,025)
Net loss for the period - - - - - - - -
---------- --------- -------- --------- -------- ------------- ---------- -----------
Balance at 6/30/99 1,228,000 - $ 4,200 $ - - - (10,225) (6,025)
Acquisition of subsidiary
corporation by PVAXX
Issuance of common
stock 3/31/00 20,000,000 - $200,000 $ - $(217,914) - - 417,914
Issuance of preferred
stock 3/31/00 - 10,000,000 - $ 100,000 - - - 100,000
Shares issued by
Oakbrook IV 5/19/00 94,800 - - - - - - -
Reverse merger with
Oak Brook IV
Shares issued by
Oakbrook 5/19/00 20,000,000 10,000,000 200,000 100,000 217,914 - - 517,914
Oakbrook shares acquired
by PVAXX
PVAXX common stock
acquired 5/19/00 (20,000,000) - (200,000) - (217,914) - - (417,914)
PVAXX preferred stock
acquired 5/19/00 - (10,000,000) - (100,000) - - - (100,000)
Foreign currency
translation adjustment - - - - - 8,882 - 8,882
Net loss for the period - - - - - - (469,269) (469,269)
----------- ----------- --------- -------- -------- --------- --------- -----------
Balance at 6/30/2000 21,322,800 10,000,000 204,200 100,000 217,914 8,882 (469,269) 61,502
----------- ----------- --------- -------- -------- --------- --------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> F-5
PVAXX CORPORATION (formerly Oak Brook Capital IV) and Subsidiaries
(Development Stage Companies)
(With Auditor's Report of September 20, 2000)
STATEMENT OF CASH FLOWS
For the years ended June 30, 2000 and 1999 and
from May 1, 1998 (Inception) thru June 30, 1999
<TABLE>
<CAPTION>
Since
2000 1999 Inception
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (459,269) $ - $ (469,464)
Adjustments to reconcile net loss to
net cash provided by (used in) operating
activities:
Depreciation & amortization $ 20,000 $ - $ 20,000
(Increase) in VAT taxes receivable (22,900) - (22,990)
(Increase) in other assets (35,817) - (35,817)
(Increase) in accounts payable 115,443 - 125,667
Increase in accrued liabilities 109,565 - 109,565
Increase in accrued officer wages 180,000 - 180,000
-------------- ------------ ------------
Net cash provided by (used in) operating
activities $ (92,978) $ - $ (93,068)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase/investment of intangible patent (64,703) - (64,703)
Purchase of equipment and improvements - - -
-------------- ------------ ------------
Net cash provided by (used in) investing
activities $ (64,703) $ - $ (64,703)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes & loans payable $ - - 7,097
Increase in loans to Officers/Directors 95,971 - 95,971
Proceeds from notes & loans payable-
related parties
Repayments of notes & loans payable (57,692) - (57,692)
Proceeds from sale of common stock - - 417,914
Proceeds from sale of preferred stock - - 100,000
Sale of common stock for services 4,200 - 4,200
Cash restricted by investor - - (299,970)
-------------- ------------- ------------
Net cash provided by (used in) financing
activities 42,479 - 267,520
-------------- ------------- ------------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 8,882 - 8,882
-------------- ------------- ------------
Increase in Cash and Cash Equivalents (106,320) - 118,631
Cash at beginning of period - - -
-------------- ------------- ------------
Cash at end of period $ (106,320) - 118,631
-------------- ------------- ------------
Supplemental information:
Interest expense $ 12,208 - 12,208
Income tax expense - - -
Noncash investing and financing
transactions:
Acquisition of equipment $ (703,693) (703,693)
Capital equipment lease 703,693 703,693
-------------- ------------- ------------
Total $ - - -
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> F-6
PVAXX CORPORATION (FORMERLY OAKBROOK CAPITAL IV) & SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
AS OF JUNE 30, 2000
NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
HISTORY OF THE REPORTING ENTITY
Originally named Oakbrook Capital IV, (Oakbrook IV) the original company
reporting herein was formed in May 1998 in Colorado, with 40,000,000
shares of common and 10,000,000 shares of preferred stock authorized. It
was registered with the SEC as one of a series of blank check companies
seeking a business combination with an operating company. On May 19,
2000, Oakbrook IV entered into a share exchange agreement accounted for
as a pooling of interests, with PVAXX Corporation, a development stage
company.
PVAXX Corporation, formed in Florida in 2000, is the parent corporation
of PVAXX Research & Development LTD, PVAXX, (Europe) LTD, and PVAXX
Technologies LTD. PVAXX Corporation purchased net business assets at
fair value of PVAXX Research & Development LTD and PVAXX Technologies LTD
in exchange for 10,000,000 shares of its Preferred and 20,000,000 shares
of its Common stock. The net business assets consisted of two patent
applications described below, current liabilities, and a vehicle. This
transaction was accounted for as a combination of entities under common
control. The PVAXX companies were owned and controlled by the acquiring
Company's President and Chairman of the Board of Directors, Henry
Stevens. The only activities of any of these companies to date have been
development stage activities.
The role of each of the subsidiary companies is as follows:
* PVAXX Technologies, Ltd. is the holder of unlimited rights to
manufacture, process, and sell poly vinyl alcohol products governed
by patents issued under International Publication Numbers WO
98/26911 on June 25, 1998 and WO 00/12615 on March 9, 2000
* PVAXX Research and Development Ltd. performs research into product
improvements and applications. Doing business as PVAXX Engineering,
it produces machines forming the product into pellets, which are
then sold to converters. Under the trade style PVAXX SoftCap
Systems it manufactures and sells capsule making machinery
* PVAXX Europe Ltd. is a dormant company.
In conjunction with the share exchange agreement, consummating a reverse
merger, Oakbrook IV, changed its name to PVAXX Corporation, and the newly
named PVAXX and all of the subsidiaries have changed their respective
fiscal year-ends to June 30.
<PAGE> F-7
PRINCIPLES OF CONSOLIDATION
These financial statements include the combined accounts of the Colorado
corporation, Oak Brook Capital IV, and the former Florida corporation,
PVAXX Corporation They are consolidated with the three 100% owned UK
subsidiary corporations (PVAXX Technologies, Ltd., PVAXX Research &
Development, Ltd. and PVAXX Europe, Ltd.). After conversion of UK
currency to US dollars, all significant inter-company accounts and
transactions have been eliminated.
FOREIGN CURRENCY TRANSLATION AND TRANSACTIONS
The financial position and results of operations of the company's foreign
subsidiaries are determined using the local currency as the functional
currency. Assets and liabilities of these subsidiaries are translated at
the exchange rate in effect as of the balance sheet date. Income
statement accounts are translated at the average rate of exchange
prevailing during the period. Translation adjustments arising from the
use of differing exchange rates from period to period are included in the
accumulated other comprehensive income account in shareholder's equity
section.
USE OF ESTIMATES
The process of preparing financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reporting of amounts of assets
and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period.
CASH AND CASH EQUIVALENTS
Highly liquid assets with a maturity date of three (3) months or less
from the date of acquisition are treated as cash or cash equivalents.
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost less accumulated depreciation.
Depreciation is computed using straight-line and accelerated methods over
estimated useful lives of the property. Estimated useful lives of
property & equipment are as follows:
Machinery & equipment 3 to 15 years
Office equipment 5 years
Furniture & fixtures 5 to 7 years
Motor vehicles 5 years
The amortization of leasehold improvements is based on the shorter of the
lease term or the life of the improvement.
Betterments and large renewals, which extend the life of an asset, are
capitalized whereas maintenance and repairs and small renewals are
expensed as incurred.
<PAGE> F-8
VAT TAXES RECEIVABLE
The United Kingdom subsidiaries are required to pay a Value Added Tax
(VAT) on purchases made from certain vendors. The company receives a tax
refund for the VAT paid to various vendors.
OTHER ACCRUED LIABILITIES
Other accrued consist of accrued employee wages, and payroll taxes, due
as the balance sheet date.
INTANGIBLES
The patents were acquired from a related party in exchange for stock in
the PVAXX group of companies. The patents were valued at their
historical cost at the date of acquisition and the stock was valued at
the historical cost of the patent. Intangible assets such as patents on
other intellectual property are recorded at cost if it is determinable at
the date of acquisition. Such intangible assets are amortized over
estimated useful lives based on the nature of the item. The Company will
begin amortizing its patent when it emerges from the development stage.
In accordance with SFAS 121, "Accounting for Impairment of Long-Lived
Assets and Long-Lives Assets to be Disposed of", intangibles are
evaluated for impairment when events or changes in circumstances indicate
that the carrying amounts of the assets may not be recoverable through
the estimated undiscounted future cash flows resulting from the use of
these assets. When any such impairment exists, the related assets are
written down to fair value.
The company has not generated any revenue relating to its patents due to
the fact that its operations are in the development stage. Although
there is substantial doubt about the company's ability to continue as a
going concern as described in Note #9, the company has just acquired the
patents and it is actively engaged in promoting and developing this
technology. At this time there are no events and conditions that exist
to indicate that the asset maybe impaired. However, should the company's
efforts to negotiate successful long-term revenue contracts for its
products, the company will realize an impairment loss on the write-down
of the patent to its fair value.
INCOME TAXES
The Company uses the asset and liability method as identified in SFAS
109, Accounting for Income Taxes.
The consolidated Company has a net operating loss carryforward (NOL) of
$469,494 available to future periods due to losses generated since its
inception through June 30, 2000. The net operating losses and credits
expire at various dates beginning in 2018 and continuing through 2020.
This NOL would result in a tax debit based on application of appropriate
UK and US tax rates if offsetting profits were anticipated. Because the
Company and its subsidiaries are in the development stages, there is no
assurance that future operations will generate a profit or income,
therefore the company recognizes a valuation adjustment which completely
offsets the deferred tax asset related to the net operating loss
carryforward.
<PAGE> F-9
STOCK EXCHANGED FOR SERVICES
The issuance of equity instruments in exchange for goods or services are
accounted for based upon the fair value of the goods or services
received. The services exchanged for equity shown on the statements of
changes of stockholder's equity were valued at $.003/share because it was
determined that $4,200 worth of legal services had been provided to set
up the Oak Brook IV shell.
CONVERTIBLE PREFERRED STOCK
The Company issued convertible preferred stock relating to the
transaction discussed above and in Note 3. The preferred stock does not
have voting rights, and is noncumulative, nonparticipating and has
preference up to its par value upon liquidation. The stock maybe
converted 1 for 1 for common stock at the discretion of holder.
NOTE 2 - ACCOUNTS RECEIVABLE
Management believes all receivables are due and collectible and no
reserve for un-collectable amounts is necessary.
NOTE 3 - RELATED PARTY TRANSACTIONS
As discussed in Note #1, the Company effectively acquired PVAXX Research
& Development LTD and PVAXX Technology, from a company owned and
controlled by Henry Stevens, the present majority shareholder of PVAXX
Corporation. The ultimate consideration for the transaction is the
10,000,000 shares of Preferred stock and 20,000,000 shares of Common
stock held by Henry Stevens and others whose PVAXX Florida corporation
shares were exchanged.
The President, and another officer, advanced $95,971 to the Company on a
short-term basis with no interest. These amounts have not accrued any
imputed interest and are expected to be repaid shortly after the balance
sheet date.
The patent rights owned by PVAXX Technologies, Ltd., were developed by
and acquired from a company owned by the President, Henry Stevens, and
are carried at their actual cost of $68,018.
The Company entered into an Employment Agreement dated March 20, 2000
with Henry Stevens, the Company's President and Chairman of the Board of
Directors. The Agreement is for a term of five years and renewable by the
Company.
Under the Agreement, the Company agrees to pay the following amounts:
a) $50,000 per month net of all taxes;
b) Use of a motor vehicle at the choice of the
employee;
c) Use of residential facilities in the Fort
Myers area at a rental not to exceed
$36,000 per annum; and
d) The Company will establish a performance
related share option program, under which
the company's board of directors will
determine participation commensurate with
the employee's position. However, as of
balance sheet date, the Company has not
officially established a share option plan.
<PAGE> F-10
No payments have been made under the Agreement as of the date of the
financial statements.
NOTE 4 - RISKS AND UNCERTAINTIES
The Company's future operating results may be affected by a number of
factors. The ability of the Company to raise the capital necessary to
continue to develop and bring its products to market is not assured. The
product being developed by PVAXX will be sold in a highly competitive
global market in which it will need to demonstrate performance
characteristics sought by customers, at a competitive price which will
yield a profit after production and distribution costs. Estimates of the
size of the market, and the company's eventual market share may not be
realized, and the effect of competition cannot be determined.
NOTE 5 - COMMITMENTS AND CONTINGENT LIABILITIES
LEASED FACILITIES - OPERATING LEASE
The Company has entered into a three (3) year operating lease for office
space in the Fort Myers area with an unrelated party. Under the terms of
this lease, effective June 1, 2000 the Company is obligated for monthly
base rental amounts plus sales tax and Common Area Maintenance (CAM)
charges. Under the terms of the lease, the Company is obligated to keep
and maintain the leased premises, including fixtures and improvements, in
good condition.
The Company is obligated for the following rent payments over the lease
term:
<TABLE>
<CAPTION>
Total Monthly Sales
Rent Base Rent CAM Tax
<S> <C> <C> <C> <C>
Year 1
1st quarter $11,013 $2,000 $1,463 $208
2nd quarter 11,013 2,000 1,463 208
3rd quarter 12,285 2,400 1,463 232
4th quarter 13,239 2,700 1,463 250
Year 2 55,080 2,808 1,522 260
Year 3 57,276 2,920 1,583 270
</TABLE>
EMPLOYEE COMPENSATION
In addition to the employment contract with the President disclosed in
Note 3, an arrangement with the Vice-president provides for a salary of
$10,000 monthly for one year, and $15,000 thereafter.
<PAGE> F-11
NOTE 6 - RESTRICTED CASH
On March 3, 2000, the former PVAXX executed an agreement with an
unrelated individual who transferred $299,970 to an escrow agent in
exchange for 90,000 share block of the 20,000,000 shares of common stock
issued as discussed in Notes 1 and 3. Under the terms of the escrow
agreement, updated and signed on August 4, 2000, the funds will be
released to the company when the exchanged shares of the new PVAXX
Corporation are tradable on a U.S. national exchange at not less than
$5.00 per share. If this is not achieved, the funds may be released to
the investor six (6) months after the effective date (August 4, 2000) of
the agreement, upon return of the 90,000 shares
Which would be held as treasury stock. As of balance sheet date the
90,000 shares of stock as well as the $299,970 remain in the custody of
the escrow agent.
NOTE 7 - FAIR VALUES OF FINANCIAL INSTRUMENTS
The carrying amounts reported in the consolidated balance sheet for cash
and cash equivalents, restricted cash, receivables, accounts payable,
accrued expenses and other liabilities, approximate fair value because of
immediate or short-term maturity of these financial instruments. The
underlying carrying amount reported for long-term debt and capital leases
approximates fair value because, in general, the interest on the
underlying instruments fluctuates with market rates.
NOTE 8 - EARNINGS PER SHARE
Basic earnings per share are computed by dividing earnings available to
common stockholders by the weighted average number of common shares
outstanding during the period. Diluted earnings per share reflect per
share amounts that would have resulted if all preferred stock had been
converted to common stock. The following reflects amounts reported in
the financial statements:
<TABLE>
<CAPTION>
For the period ended June 30, 2000
----------------------------------
Income Shares Per-share
(Numerator) (Denominator) Amount
<S> <C> <C> <C>
Income available to common
stockholders
-basic earnings per share $(459,269) 11,249,356 $ (0.04)
Effect of dilutive securities
-convertible preferred
stock 10,000,000
----------------------------------------
Income available to common
stockholders
-fully diluted earnings
per share $(459,269) 21,249,356 $ (0.02)
----------------------------------------
----------------------------------------
For the period ended June 30, 2000
----------------------------------
Income available to common
stockholders
-basic earnings per share $ - 1,228,000 $ -
From inception
----------------------------------
Income available to common
stockholders
-basic earnings per share $(469,494) 11,249,356 $ (0.04)
Effect of dilutive securities
-convertible preferred
stock 10,000,000
-----------------------------------------
Income available to common
stockholders
-fully diluted earnings
per share $(469,494) 21,249,356 $ (0.02)
-----------------------------------------
</TABLE>
<PAGE> F-12
NOTE 9 - GOING CONCERN CONSIDERATIONS
The ability of the Company to emerge from the development stage and to
develop into a going concern is dependent on the success of the Company
in negotiating long-term revenue contracts and acquiring additional
equity capital. However, there can be no assurance that the Company will
be successful in accomplishing its objectives. The financial statements
do not include any adjustments that might be necessary should the
company, be unable to continue as a going concern.
The company is addressing the substantial doubt about its ability to
continue as a going concern through the deferral of cash payments to the
principal shareholders, through the negotiation of anticipated private
placements with additional investors, and by taking steps to register
shares for sale on the public market in order to generate additional
working capital, in order for the company to expand its operations and to
bring it's product to the market. In addition, certain of the company's
officers and shareholders have agreed that they will advance to the
company some additional funds that the company needs for operating
capital. Although, as of the balance sheet date of June 30, 2000, the
Company had not entered into any revenue-producing contracts, several
successful field tests of various products have been conducted, and
management expects to have successfully negotiated several contracts
before the end of this fiscal year.
NOTE 10 - LONG TERM LIABILITIES
Long-term liabilities include a three-year capital lease dated May 1, 2000 with
a related party, for equipment, office furniture and vehicles, and an automobile
note with an unrelated party. Depreciation expense for leased assets is
included in depreciation expense for owned assets.
The gross amounts of assets recorded under capital leases are listed in the
table below:
Machinery & equipment $ 596,851
Furniture & fixtures 45,496
Motor vehicles 59,293
-----------
Total Assets acquired 701,640
Less accumulated depreciation (18,322)
-----------
Net leased assets $ 683,318
-----------
-----------
The future minimum lease payments and the obligations owed on the
automobile note are listed in the table below.
<TABLE>
<CAPTION>
Capital Lease Auto note
<S> <C> <C>
2001 $ 129,776 $ 2,670
2002 134,405 3,170
2003 381,821 1,491
--------- -------
CURRENT 129,776 2,670
LONG TERM 516,226 4,427
--------- -------
TOTAL $ 646,002 $ 7,097
</TABLE>
PVAXX CORPORATION IS THE GUARANTOR OF THESE LEASES.
<PAGE> 15
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not Applicable.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Exchange Act, requires the Company's officers,
directors and persons who beneficially own more than ten percent of the Common
Stock to file reports of securities ownership and changes in such ownership
with the Securities and Exchange Commission. Officers, directors and greater
than ten percent beneficial owners also are required by rules promulgated by
the Securities and Exchange Commission to furnish the Company with copies of
all Section 16(a) forms they file.
Based solely upon review of the copies of such forms furnished to the
Company, or written representations that no Form 5 filings were required, the
Company believes that during 1999 all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were complied with on a timely basis.
Committees of the Board
------------------------------------
The Board of Directors delegates certain of its authority to a Compensation
Committee and an Audit Committee. There are currently vacancies on both of
these committees. The Board expects to fill such vacancies after it has
filled the vacancies on the Board of Directors.
The primary function of the Compensation Committee will be to review and make
recommendations to the Board with respect to the compensation, including
bonuses, of the Company's officers and to administer the Company's
Compensatory Stock Consulting Plan.
The function of the Audit Committee is to review and approve the scope of
audit procedures employed by the Company's independent auditors, to review and
approve the audit reports rendered by both the Company's independent auditors
and to approve the audit fee charged by the independent auditors. The Audit
Committee will report to the Board of Directors with respect to such matters
and recommends the selection of independent auditors.
<PAGE> 16
Management
Members of Management will devote their full time and attention to the
operations of the Company.
The following table sets forth the ages of and positions and offices presently
held by each Director of the Company. For information about ownership of the
Company's Securities by each director, see "BENEFICIAL OWNERSHIP OF PVAXX
SECURITIES."
<TABLE>
<CAPTION>
Date First
Became Positions and Offices
Name Age Director With the Company
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Henry Stevens(1) 37 June 26, 2000 President and Director
Bryan Wade(1) 53 June 26, 2000 Vice President, Secretary and
Director
--------------------------------------------------------------------------------
</TABLE>
(1) The persons listed are the sole officers and directors of the Company.
The board plans to adopt stock option plans and incentive-based restricted
stock plans for officers, directors and employees of the Company although
terms and conditions have not been established or agreed upon. Otherwise,
management has no plans to issue any additional securities to management,
promoters or their affiliates or associates and will do so only if such
issuance is in the best interests of shareholders of the Company and complies
with all applicable federal and state securities rules and regulations.
Although the Company has a very large amount of authorized but unissued common
and preferred stock that may be issued without further shareholder approval or
notice, it is the intention of the Company to avoid inhibiting certain
transactions with prospective acquisition or merger candidates, based upon the
perception by such candidate that the biodegradable plastics industry is
rapidly expanding and may not afford the opportunity to proxy shareholders
each time our management needs to authorize additional shares.
<PAGE> 17
Personal Biographies and Summary of Experience
HENRY STEVENS, President and Director
From 1979 to 1986, Mr. Stevens was the Agricultural Manager in Bisley, UK.
From there, Mr. Stevens was a design consultant in packaging development at
Deranged Design from 1987 to 1993. It was here that Mr. Stevens first became
involved with PVA polymers. He was Managing Director at Churchill Technology
(IOM) Ltd., which is a PVA technology company. He then served as Managing
Director of FIP Holdings, Ltd., which is a PVA development company until
1997. In 1998, Mr. Stevens began serving as Managing Director of PVAXX
Group. His experience with PVA materials, particularly in young companies,
will certainly be a valuable tool in PVAXX's development.
Mr. Stevens is a director and shareholder of Jumik Investments, Inc., and
investment holding company that he controls and manages.
BRYAN WADE, Vice President and Director
Mr. Wade has extensive sales and marketing experience, beginning in 1985, when
he served as Director of Multi-National Sales and Marketing at CFS. Mr. Wade
held similar positions in Weststar Marketing and SAS Marketing Ltd. In 1995
Mr. Wade was sent to America to establish the US arm of SAS Ltd. SAS Inc.
started trading in February of 1996, selling a US made product into the motor
industry in Florida, By the following year, SAS Inc. had achieved the position
as the number one distributor for this product throughout the United States.
Early in 2000, Mr. Wade joined PVAXX as a Vice President, overseeing all sales
and marketing for the company. Still acting as the President of SAS Inc.,
his role in the Company is more on an advisory basis with regard to sales and
administration.
LAURENCE CALLOW, Chief Executive Officer
Mr. Callow is a successful General Manager with a marketing and business
development background in OTC healthcare, fmcg and food technology where he
has helped to establish a new high-technology sweetener production plant from
scratch in Dubai, U.A.E. He also helped launch a new sweetener business for
Tate & Lyle in Jeddah, Saudi Arabia, developed the European Marketing Strategy
for a sweetener product for Tate & Lyle in a joint venture with Johnson &
Johnson, and has introduced a new pace and focus to the Category Development
Trade Marketing Team at Pepsico Food International by reorganizing the
function to significantly reduce cost.
Mr. Callow was Managing Director and Vice President -Group Business
Development for Concept Foods International from 1998-Present. He was also
the General Manager, Sales and Marketing-USC Middle East/Africa/Asia and
European Marketing Manager for Tate & Lyle
<PAGE> 18
International from 1994-1998, was Business Development Director for Holmes &
Marchant Healthcare from 1992-1994, was Senior Trade Marketing Manager for
Pepsico Foods International from 1990-1992, was the Group Brand Manager for
GD Searle Pharmaceuticals from 1984-1989 and was Brand Manager for Warner
Lambert Healthcare from 1980-1884.
Mr. Callow received a BSc (Hons) in Business Administration from Aston
University, U.K. He is a Member of the Chartered Institute of Marketing
(MCIM) and completed the Senior Executive Development Programme while
employed at Tate & Lyle.
JAMES Q. MATHIAS, ESQ., Vice President, Marketing
Mr. Mathias served as Director of Penchant Foods (London W3) from 1992-2000,
where he directed expertise in all aspects of business management, buying,
marketing, logistics, branding, packaging and new product development and
sales. He was also Product Marketing Manager for Sony (VE) London from
1989-1991, and was Brand Manager for Times Corporation (London W7) from
1987-1989.
Mr. Mathias received a Post-graduate Diploma in Marketing from Bristol
Polytechnic in 1987 and a Business Studies-HND from Brighton Polytechnic in
1985.
---------------------------------------------------------
<PAGE> 19
Management Loans and Borrowing
The Company's executive officers and directors do not plan to negotiate loan
agreements, nor do they have understandings between the Company and third
parties. Certain of the Company's officers and shareholders have verbally
agreed that they will advance to the Company some additional funds that the
Company needs for operating capital. The Company will not borrow any funds
from anyone other than its current shareholders for the purpose of repaying
advances made by the shareholders, and the Company will not borrow any funds
to make any payments to the Company's promoters, management or their
affiliates or associates.
Consultants
The Company is a development stage company and currently has limited
employees. Management of the Company expects to use attorneys and accountants
as necessary. The need for additional employees and their availability will
be addressed in connection with the decision whether or not to commence
certain business objectives.
Since Company management has no current plans to use any outside consultants
or advisors, 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.
<PAGE> 20
Board of Directors
Colorado provides that a corporation's board of directors may be divided into
various classes with staggered terms of office. Our directors are elected for
a term of three years and until their successors are elected and qualified.
Number of Directors
Our board of directors currently consists of two directors. The number of
directors on our board may only be changed by a vote of a majority of our
directors, subject to the rights of the holders of any outstanding series of
our Company's preferred stock to elect additional directors.
Removal of Directors
Our directors, or the entire board, may be removed for cause by the
affirmative vote of the holders of at least 50% of the outstanding shares of
common stock entitled to vote in the election of directors, voting as a single
class and subject to the rights of the holders of any outstanding series of
our Company's preferred stock.
Filling Vacancies on the Board of Directors
Any newly created directorships in our board of directors, resulting from any
increase in the number of authorized directors or any vacancies, may be filled
by a majority of the remaining members of such board of directors, even though
less than a quorum, or in the case of our company, by a sole remaining
director, subject to the rights of holders of any outstanding series of
preferred stock. Newly created directorships or decreases in directorships in
our board of directors are to be apportioned among the classes of directors so
as to make all classes as nearly equal in number as practicable, provided that
no decreases in the number of directors in our board of directors may shorten
the term of any director then in office.
To the extent reasonably possible, any newly created directorship will be
added to the class of directors whose term of office is to expire at the
latest date following the creation of that directorship, unless otherwise
provided for by resolution of the majority of the directors then in office.
Any newly eliminated directorship will be subtracted from the class whose
office is to expire at the earliest date following the elimination of the
directorship, unless otherwise provided for by resolution of the majority of
the directors then in office.
<PAGE> 21
Ability to Call Special Meetings
Special meetings of our Company's stockholders may be called by our board of
directors, by affirmative vote of a majority of the total number of authorized
directors at that time, regardless of any vacancies, or by the chief
executive officer.
Advance Notice Provisions for Stockholder Nominations and Proposals
Our bylaws allow stockholders to nominate candidates for election to the board
of directors at any annual or any special stockholder meeting at which the
board of directors has determined that directors will be elected. In
addition, the bylaws allow stockholders to propose business to be brought
before any annual stockholder meeting. However, nominations and proposals may
only be made by a stockholder who has given timely written notice to the
Secretary of our Company before the annual or special stockholder meeting.
Under our Company's bylaws, to be timely, notice of stockholder nominations or
proposals to be made at an annual stockholder meeting must be received by the
Secretary of our Company no less than 60 days nor more than 90 days before the
first anniversary of the preceding year's annual stockholder meeting. If the
date of the annual meeting is more than 30 days before or more than 60 days
after the anniversary of the preceding year's annual stockholder meeting,
notice will also be timely if delivered within 10 days of the date on which
public announcement of the meeting was first made by our Company.
In addition, if the number of directors to be elected is increased and no
public announcement is made by us naming all of the nominees or specifying the
size of the increased board of directors at least 70 days before the first
anniversary of the preceding year's annual meeting, or, if the date of the
annual meeting is more than 30 days before or 60 days after the anniversary
of the preceding year's annual meeting, at least 70 days before the annual
meeting, a stockholder's notice will be considered timely, with respect to the
nominees for any new positions created by the increase, if it is delivered to
the Secretary of our company within 10 days of the date on which public
announcement of the meeting was first made by us.
Under our bylaws, to be timely, notice of a stockholder nomination to be made
at a special stockholder meeting must be received no less than 60 days nor
more than 90 days before a special meeting at which directors are to be
elected or within 10 days of the date on which public announcement of the
special meeting was first made by our Company.
<PAGE> 22
A stockholder's notice to us must set forth all of the following:
-all information required to be disclosed in solicitations of proxies for
election of directors, or information otherwise required by applicable law,
relating to any person that the stockholder proposes to nominate for election
or reelection as a director, including that person's written consent to being
named in the proxy statement as a nominee and to serving as a director if
elected
-a brief description of the business the stockholder proposes to bring before
the meeting, the reasons for conducting that business at that meeting and any
material interest of the stockholder in the business proposed
-the stockholder's name and address as they appear on our books and the class
and number of shares which are beneficially owned by the stockholder
-The chairman of our stockholder meeting will have the power to determine
whether the nomination or proposal was made by the stockholder in accordance
with the advance notice procedures set forth in our bylaws.
-If the chairman determines that the nomination or proposal is not in
compliance with advance notice procedures, the chairman may declare that the
defective proposal or nomination will be disregarded.
Director Compensation
The directors of our Company, who are all executive officers as well, are not
compensated for serving.
Limitation of Liability and Indemnification
Our Articles of Incorporation provide that a director of our Company shall not
be personally liable to the Company or any of its shareholders for monetary
damages for breach of fiduciary duty as a director, except for liability:
(i) for any breach of the director's duty of loyalty to the Company or its
shareholders,
(ii) for acts or omissions not in good faith or which involve gross
negligence, intentional misconduct or a knowing violation of law,
(iii) for any unlawful distribution as set forth in the Colorado Model Business
Corporation Act of Colorado; or
<PAGE> 23
(iv) for any transaction from which the director derived an improper personal
benefit. These provisions may have the effect in certain circumstances of
reducing the likelihood of derivative litigation against directors. While
these provisions may eliminate the right to recover monetary damages from
directors in various circumstances, rights to seek injunctive or other
non-monetary relief is not eliminated.
<PAGE> 24
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE FOR PVAXX
Long Term Compensation
_______________________________________________________________________
Annual Compensat. Awards Payouts
_______________________________________________________________________
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Rest. All
Name and Annual Stock LTIP Other
Principal Calend. Comp. Award(s)Opt. P/outs Comp.
Position Year Salary Bonus($) ($) ($) SARs(#) ($) ($)
_______________________________________________________________________
Director
Stevens, 1999 0 0 - - - - -
Henry (annualized)
1998 0 0 - - - - -
Director
Wade, 1999 0 0 - - - - -
Bryan (annualized)
1998 0 0 - - - - -
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of PVAXX Common Stock as of July 10, 2000 by (i) each person
known by PVAXX to own beneficially more than 5% of the outstanding Common
Stock, (ii) each director, and (iii) all executive officers and directors as
a group. Each person has sole voting and sole investment or dispositive power
with respect to the shares shown except as noted.
<TABLE>
<CAPTION>
----------------------------------------------------
<S> <C> <C> <C>
COMMON STOCK
----------------------------------------------------
Name and address # of % of
of beneficial owner shares Class Options
--------------------------------------------------------------------------------
Jumik Investments, Inc. 16,613,815 77.9000% -
Henry Stevens, Majority
and Controlling Shareholder
Henry Stevens 10,000 00.0005% -
All Officers and
Directors as a Group 16,623,815 77.9600% -
PREFERRED STOCK
----------------------------------------------------
Jumik Investments, Inc 10,000,000 100.000% -
Henry Stevens, Majority
and Controlling Shareholder
</TABLE>
<PAGE> 25
The beneficial owners have sole voting and investment power with respect to
the ownership and potential disposition of their securities.
Our management has advised that we may acquire additional shares of our common
stock from time to time in the open market at prices prevailing at the time
of such purchases.
Our company's key personnel bring a broad range of private and public
management, corporate finance and technical skills to the Company.
DIVIDENDS
The Company has never paid dividends with respect to the Common Stock and
currently does not have any plans to pay cash dividends in the future. There
are no contractual restrictions on the Company's present or future ability to
pay dividends. Future dividend policy is subject to the discretion of the
Board of Directors and is dependent upon a number of factors, including future
earnings, capital requirements and the financial condition of the Company.
The Colorado Corporation Code provides that a corporation may not pay
dividends if the payment would reduce the remaining net assets of the
corporation below the corporation's stated capital plus amounts constituting
a liquidation preference to other security holders.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Other than their employment agreements with the Company (refer to
"Management-Employment Contracts" above), no material transactions involving
the directors, senior officers or principal holders of the Company's
securities have occurred since the Company was incorporated except for several
loans previously made to the Company by the Company's principals.
The Company intends to indemnify its officers and directors to the full extent
permitted by Colorado law. Under Colorado law, a corporation may indemnify its
agents for expenses and amounts paid in third party actions and, upon court
approval in derivative actions, if the agents acted in good faith and with
reasonable care. A majority vote of the Board of Directors, approval of the
stockholder or court approval is required to effectuate indemnification.
Insofar as indemnification for liabilities arising under the Securities Act,
as amended, may be permitted to officers, directors or persons controlling the
Company, the Company has been advised that, in the opinion of the Securities
and Exchange Commission, such indemnification is against public policy as
expressed in such Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Company of expenses incurred or paid by an officer, director or
controlling person of the Company in the successful defense of any action,
suit or proceeding) is asserted by such officer, director or controlling
person in connection with the securities being registered, the Company will,
unless in the opinion of its 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
<PAGE> 26
expressed in such Act and will be governed by the final adjudication of such
issue.
Transactions between the Company and its officers, directors, employees and
affiliates will be on terms no less favorable to the Company than can be
obtained from unaffiliated parties. Any such transactions will be subject to
the approval of a majority of the disinterested members of the Board of
Directors.
PART IV
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
The following documents are filed herewith or have been included as exhibits
to previous filings with the Commission and are incorporated herein by this
reference:
Exhibit No. Exhibit
x 2.10 Agreement and Plan of Share Exchange
x 2.11 Articles of Share Exchange
# 3(a) Articles of Incorporation
# 3(b) Bylaws
# 4(a) Agreements Defining Certain Rights of
Shareholders
# 4(b) Specimen Stock Certificate
x 5.10 Legal Opinion (Nadeau & Simmons, P.C.) -
Investment Representation Letter
7 Not applicable
9 Not applicable
11 Not applicable
14 Not applicable
16 Not applicable
21 Not applicable
x 23.1 Consent of Counsel
(contained in Exhibit 5.1)
<PAGE> 27
## 24.1 Consent of CPA.
27 Financial Data Schedule
28 Not applicable
## 99.1 Safe Harbor Compliance Statement
____________________________
x filed herewith
# previously filed
## incorporated herein by reference from Registrant's Definitive
Information Statement, filed on Schedule 14C on June 12, 2000.
(b) REPORTS ON FORM 8-K
The Company filed the following reports on Form 8-K during the last quarter
of the 1999 fiscal year.
July 11, 2000-Form 8-K Filed for Item 1, Change in Control
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this annual report on Form 10KSB to be signed on
its behalf by the undersigned hereunto duly authorized.
PVAXX CORPORATION
By: /s/ Henry Stevens
________________________________
HENRY STEVENS
Chairman
Date: December 18, 2000
<PAGE> 26
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears
below constitutes and appoints Henry Stevens, his true and lawful
attorneys-in-fact and agents with full power of substitution and
re-substitution, for then and in their name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this registration statement and to file the same with all
exhibits thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully to all
intents and purposes as they might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
This power of attorney may be executed in counterparts.
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on
the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- -------- -------------------------
<S> <C> <C>
/s/ Bryan Wade Secretary December 18,2000
</TABLE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
EXHIBITS
TO
FORM 10-KSB
---------------------------
PVAXX CORPORATION
EXHIBIT INDEX
(a) EXHIBITS
The following documents are filed herewith or have been included as exhibits
to previous filings with the Commission and are incorporated herein by this
reference:
Exhibit No. Exhibit
x 2.10 Agreement and Plan of Share Exchange
x 2.11 Articles of Share Exchange
# 3(a) Articles of Incorporation
# 3(b) Bylaws
# 4(a) Agreements Defining Certain Rights of
Shareholders
# 4(b) Specimen Stock Certificate
x 5.10 Legal Opinion (Nadeau & Simmons, P.C.) -
Investment Representation Letter
7 Not applicable
9 Not applicable
11 Not applicable
14 Not applicable
16 Not applicable
21 Not applicable
x 23.1 Consent of Counsel
(contained in Exhibit 5.1)
<PAGE>
## 24.1 Consent of CPA.
27 Financial Data Schedule
28 Not applicable
## 99.1 Safe Harbor Compliance Statement
____________________________
x filed herewith
# previously filed
## incorporated herein by reference from Registrant's Definitive
Information Statement, filed on Schedule 14C on June 12, 2000.
