SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB/A
AMENDMENT NO. 1
GENERAL FORM FOR REGISTRATION OF SECURITIES
Small Business Issuers
Under Section 12(b) or 12(g) of the Securities Exchange
Act of 1934
SENTRY ACCOUNTING, INC.
--------------------------------------------
(Name of Small Business Issuer in its Charter)
Florida 59-3391244
-------------------------------- ----------------------
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification Number)
321 N. Kentucky Ave., Suite 1, Lakeland, FL 33801
- ------------------------------------------- ----------------
(941) 683-5523
-------------------------
(Issuer's Telephone Number)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class to be registered: Name of each exchange on which
each class is to be registered:
N/A N/A
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock
<PAGE>
PART I
Item 1. DESCRIPTION OF BUSINESS.
INTRODUCTION
- ------------
Sentry Accounting, Inc., a Florida corporation (the "company" or "Sentry)
provides support services to private and public businesses in need of short or
long-term solutions in the areas of administration, accounting and financial
services.
BACKGROUND
- ----------
Sentry was incorporated in June, 1996 under the name Sentry Communication
Services, Inc. for the purpose of selling telephone calling cards and other
similar products. Donald R. Mastropietro served as sole director and shareholder
of Sentry Communication Services, Inc. until September 30, 1998. In October,
1996, Mr. Mastropietro determined that the telephone calling card business would
not be a successful endeavor, so he changed the name and focus of the company
and began providing accounting and financial services to various private and
public companies. From October 1996 until September 30, 1998, Sentry's revenues
came from providing basic bookkeeping and accounting services to individuals,
small businesses and start-up businesses. On September 30, 1998, TBC
Investments, Inc. purchased 2,000,000 shares of the company's restricted common
stock for $200. As the company's common stock has no par value, the purchase
price of the 2,000,000 shares was based on an agreed upon figure of $.0001 per
share. TBC Investments, Inc. acquired the majority interest in the company to
use its name and goodwill developed by the company as a basis for expanding the
company into a multi-purpose financial consulting operation covering the central
Florida area. Mr. Mastropietro continues to serve as an officer of the company.
Sentry's total assets and stockholders' equity as of December 31, 1998 are
both $5,020. There have been no bankruptcies, receiverships or similar
proceedings in this company.
BUSINESS
- --------
Sentry currently provides support services to private and public businesses in
need of short-term or long-term solutions in the areas of general bookkeeping,
payroll and payroll tax services as outlined below:
General Bookkeeping Services: This area includes (i) the day to day
bookkeeping activities of clients who have been in business and need
services that extend beyond checkbook maintenance; (ii) start-up
bookkeeping for clients who have been in business, but have lost
control of their bookkeeping function; and (iii) start-up bookkeeping
for clients who are beginning a business and require support to
establish a bookkeeping system that can be maintained by the client
once full time employees are hired.
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<PAGE>
Payroll and Payroll Tax Services: This area includes the preparation
of payroll and payroll taxes for the client that does not want to be
bothered with the complexities of payroll processing and payroll tax
filing.
During the third quarter of 1998, several of Sentry's clients developed
needs outside of the basic bookkeeping services then provided by Sentry. Based
on these discussions, the company expects to continue providing these basic
bookkeeping and accounting services, but plans to expand its array of services
to include financial consulting services, corporate services, data processing
services and secretarial services, as outlined below:
Financial Consulting Services: This area will include compliance
services for public companies relating to NASD, SEC, and federal and
state reporting requirements, including preparation and EDGAR filing
of Forms 10-KSB, 10-QSB, 8-K and other necessary documents. This area
will also include preparation and filing of federal and state income
tax returns for private and public companies.
Corporate Services: This area will include assisting clients with
initial federal and state registrations, maintaining corporate
records, preparation of minutes for shareholders and board of
directors meetings, preparation of shareholder mailings, and any other
service necessary to insure that the client is current with all
corporation requirements.
Data Processing Services: This area will include start-up services for
clients with new or upgraded computer systems, installation and
training for new software, preparation of graphs, charts, business
cards, letterhead etc., and general on-site data processing support.
Secretarial Services: This area will include all forms of secretarial
and receptionist support services.
With the increase of new businesses and reporting requirements, start-ups
and small businesses are in need of a competitively priced, competent,
dependable service provider. Sentry will provide its services efficiently and
effectively at a low cost to its business owners.
On October 15, 1998, the company entered into a consulting agreement with
Progressive Ventures International, Inc. to assist the Company in accomplishing
its goals. Specific services provided by Progressive included writing the
business plan and research and development of the company's marketing
strategies. The consulting agreement called for a fee of $4,600; $1,000 of which
was paid in cash and $3,600 which was paid by the issuance of the company's
common stock at $.03 per share for a total of 120,000 shares.
Page 3
<PAGE>
GROWTH STRATEGY
- ---------------
Sentry's strategy is to build its infrastructure to provide the opportunity
for "one-stop shopping" for its clients in areas of financial, accounting and
administrative services.
Since October 1996, Sentry has provided services to approximately ten
clients in West Central Florida. While Sentry's business is not currently
dependent upon one or a few of these clients, there is the possibility that the
loss of several of these clients could negatively affect the business. Sentry
does not anticipate the loss of any of its clients and further expects that its
business will increase due to the associated businesses of its current customer
base. It is Sentry's intention to increase its business in the West Central
Florida area during 1999. In late 1999, Sentry intends to expand to Orlando and
the Bradenton/Sarasota areas that are within a two-hour driving distance and
where the company has already provided services on a limited basis. Once these
areas are established, Sentry intends to further expand into other larger
metropolitan areas of Florida including Jacksonville, Miami and Ft. Lauderdale.
Although the company has not yet provided services in these areas, management
believes its business will be easily expanded in these areas due to the large
number of personal contacts that exist between the company and other unrelated
personal and small business service providers.
The anticipated costs to be incurred during the next twelve months are
approximately $155,000. These costs include all operational expenses including
sales, marketing and general administrative expenses. Expansions are anticipated
to begin on or about April 1, 1999. Sentry will not begin expansion until such
time as $15,000 is available to fund advertising and computer equipment
purchase.
MARKETING AND ADVERTISING
- -------------------------
Assuming the successful completion of funding, Sentry's marketing strategy
consists of three concurrent areas of concentration:
1. Sentry will aggressively advertise on AM and FM radio stations, and in
the local newspapers and business publications. These ads will be geared to the
entrepreneur and young business owner in need of support to maintain compliance
with all reporting requirements, so the business owner can concentrate on the
successful growth of his business.
2. Sentry will also use direct marketing techniques relying on mailing
lists currently available and will use flyer distribution.
3. Sentry's management believes that a job well done is the best form of
advertising and will rely on references from existing clients.
Page 4
<PAGE>
COMPETITION
- -----------
The accounting and financial consulting industries are highly competitive.
The company's primary sources of competition include small CPA practices and
independent bookkeeping and tax preparation firms. Some of these firms may have
substantially greater financial, technical, personnel and other resources than
Sentry and may have more established reputations for success. Several of these
competitors may have the financial resources necessary to enable them to
withstand substantial price competition or downturns in their markets.
Accordingly, Sentry's ability to compete will depend on its ability to complete
its expansion of services and geographical locations within a timely manner.
There can be no assurance that Sentry will be able to compete successfully or
that it will be able to successfully enhance its lines of services or adapt them
satisfactorily.
SEASONALITY
- -----------
Sentry's business is diversified and as such, management does not
anticipate seasonal up or downturns.
WORKFORCE
- ---------
Sentry's management currently consists of two employees. While no plan has
been established about future hires, management believes that most of its
workforce will be leased from established employee leasing firms or will be
performed by consultants.
TRADEMARKS
- ----------
The Company has no registered trademarks or tradenames.
GOVERNMENT REGULATION
- ---------------------
State and Local Regulations. The company is subject to state, county and
city licensing requirements, taxes and other local standards as may be required.
Other. The company is subject to regulation under the Americans with
Disabilities Act (the "ADA"), the Civil Rights Act of 1964, as amended, and the
Occupational Safety and Health Act. The company's offices will comply with the
ADA.
INSURANCE COVERAGE
- ------------------
The company intends to maintain comprehensive liability and general
liability insurance to insure its assets and operations subject to a $10,000
deductible per occurrence. The company also intends to maintain property
insurance subject to a $5,000 deductible per occurrence with a cap of $1
million. Sentry does not maintain errors and omissions insurance.
Page 5
<PAGE>
Item 2. MANAGEMENT'S DICSUSSION AND ANALYSIS OR PLAN OF OPERATION.
The company has met its cash requirements to date through funds derived
from operations. It is believed that the company will be able to continue
meeting its cash requirements through funds derived from operations until it
initiates its complete business plan which includes an expansion of operations
within West Central Florida. It is anticipated that this expansion will begin in
the third quarter 1999, at which time approximately $15,000 of additional funds
will be required to pay for advertising and to acquire additional computer
equipment. It is anticipated that these funds will be raised through debt
financing. Discussions have been held with two potential funding sources. After
completion of this debt funding, the company anticipates meeting its cash
requirements from operations, however, there can be no assurance that the
company will be able to raise the required funds to facilitate the expansions
proposed. The company has no plan to spend funds for any product research or
research and development. The company does not anticipate the sale or purchase
of plant or significant equipment other than the computer equipment discussed
above. The company intends to lease its employees from an established
employee-leasing firm and does not expect to hire any significant number of
employees during the next twelve months. Based on the company's financial
projections, cash requirements for operational expenses and capital acquisitions
for the next twelve months are approximately $170,000.
As of December 31, 1998, Sentry had cash totaling $989. Over the next
twelve months, it is anticipated that Sentry will incur operating expenses,
including salaries, of approximately $155,000 that it believes will be provided
through operational revenue. The company will be required to again raise funds
of approximately $25,000 as it begins its expansion outside of the West Central
Florida market. The company anticipates these funds to be raised through equity
financing from a private individual, although no commitment has been obtained.
There can be no assurance that funds from operations and outside sources will be
sufficient in the near term or that conditions and circumstances herein may
result in additional cash requirements by the company just to sustain
operations. In the event of such developments, obtaining financing under such
conditions may not be possible, or even if additional capital may be otherwise
available, the terms on which such capital may be available may not be
commercially feasible or advantageous.
Item 3. PROPERTIES.
The company's corporate office is located at 321 N. Kentucky Avenue, Suite
1, Lakeland, Florida 33801 and is provided at no charge to the company by the
company's President. Management believes this facility is adequate for its
current level of operations.
Page 6
<PAGE>
Item 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
<TABLE>
<CAPTION>
Amount
Name and Address Beneficially Percent
Title of Class of Owner Owned of Class
- -------------- -------- ----- --------
<S> <C> <C> <C>
Common Teresa B. Crowley,
Chairman, Chief Exec.
Officer, President and
Secretary
321 N. Kentucky Avenue, #1
Lakeland, FL 33801 2,000,000* 80.2890%
Common Donald R. Mastropietro,
Vice President
321 N. Kentucky Avenue, #1
Lakeland, FL 33801 1,000 00.0004%
All Officers and Directors
As a Group (2 persons) 2,001,000 80.2894%
</TABLE>
* Held in the name of TBC Investments, Inc., a Florida corporation solely
owned by Teresa B. Crowley.
Neither the officers nor director, nor the security holder listed above,
owns any warrants, options or rights.
Item 5. DIRECTORS AND EXECUTIVE OFFICERS.
Teresa B. Crowley - Chairman, Chief Executive Officer, President and Secretary
- ------------------------------------------------------------------------------
Ms. Crowley has served as Chairman, Chief Executive Officer, President and
Secretary of Sentry Accounting, Inc. since September 30, 1998, at which time she
purchased control of Sentry. Ms. Crowley also currently serves as co-founder,
Vice-President and Director of Peerless Consultants, Inc., a privately owned,
Florida corporation specializing in financial and public company consulting
since March, 1996. From January, 1995 to December, 1996, Ms. Crowley served as
Secretary of Technology Holdings. She served as Secretary and Director of
Treasure Rockhound Ranches, Inc. from August 1993 to December 1996. Previously,
Ms. Crowley served as Secretary of EVRO Corporation, parent company of
Technology Holdings, from October 19, 1992 until her resignation on March 14,
1995. On March 14, 1995, she was elected as Assistant Secretary of the Company
Page 7
<PAGE>
and served in that capacity until her resignation on May 31, 1995. Ms. Crowley
has worked as a consultant to publicly and privately owned companies, assisting
them with organizational structure, corporate filings, staffing and
policy/procedures implementation. There is no key man insurance on the life of
Ms. Crowley.
Donald R. Mastropietro - Vice President and Treasurer
- -----------------------------------------------------
Mr. Mastropietro has served as Vice President and Treasurer of Sentry
Accounting, Inc. since September 30, 1998. From inception to that date, Mr.
Mastropietro was sole owner, Chairman, Chief Executive Officer, President,
Secretary and Treasurer of the company. Mr. Mastropietro also is Director, Chief
Financial Officer, Treasurer and Executive Vice President of Treasure Rockhound
Ranches, Inc., an owner/operator of RV parks and has served in that capacity
since February 1993. From October 1972 until February 1993, Mr. Mastropietro
held several positions with Teltronics, Inc., a publicly held company which
manufactures equipment for the telecommunications industry, his last position
being that of Chief Financial Officer, Treasurer and Vice President. In these
positions, Mr. Mastropietro has either performed or supervised all day-to-day
financial activities including bookkeeping, payroll preparation, payroll tax
filings, preparation of financial statements and the filing of same with the
Commission. Mr. Mastropietro graduated from Ohio Northern University with a
degree in Business Administration with a concentration in accounting. There is
no key man insurance on the life of Mr. Mastropietro.
Item 6. EXECUTIVE COMPENSATION.
Name of Individual Capacity Year First Elected
- ------------------ -------- ------------------
Teresa B. Crowley President 1998
Donald R. Mastropietro Vice President 1996
Ms. Crowley is employed by the company at an annual salary of $48,000
beginning in January, 1999. In 1998, Ms. Crowley received $3,000. Ms. Crowley
does not have an employment agreement with the company.
Mr. Mastropietro is employed by the company at an annual salary of $40,000
beginning in January, 1999. In 1996, Mr. Mastropietro received no compensation.
In 1997 and 1998, Mr. Mastropietro received $12,650 and $10,500 respectively.
Mr. Mastropietro does not have an employment agreement with the company.
Sentry's directors are not compensated and the company has no compensation
plan for its directors. The company's directors are elected by the shareholders
at an annual meeting. The last annual meeting was held on April 7, 1998 at which
time one of the two available seats was filled by Mr. Mastropietro. On September
30, 1998, by unanimous vote of the board, Ms. Crowley was added to the board to
serve until the next annual meeting or until her successor was duly qualified
and Mr. Mastropietro resigned.
Page 8
<PAGE>
Item 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The control shareholder of the company is TBC Investments, Inc. TBC
Investments, Inc. is a private investment corporation, solely owned by Teresa B.
Crowley, organized for the purposes of making investments in small businesses.
Ms. Crowley also serves as the Chairman, President, Chief Executive Officer and
Secretary of Sentry.
Currently, Sentry has no policy regarding entering into future transactions
with affiliates and intends that any future transactions with affiliates would
be on the same terms and conditions as with a non-affiliated party.
Item 8. DESCRIPTION OF SECURITIES.
The company is authorized to issue 50,000,000 shares of no par value common
stock. The holders of each share are entitled to one vote for each share held,
and are entitled to dividends when and as declared by the Board of Directors. At
December 30, 1998, common shares issued and outstanding totaled 2,491,000. The
company has not paid and does not anticipate paying dividends in the future on
its common stock.
PART II
Item 1. LEGAL PROCEEDINGS.
The company does not currently have nor are there any anticipated or
threatened lawsuits.
Item 2. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER SHAREHOLDER MATTERS.
The company anticipates that its common stock will be listed on the OTC
Bulletin Board. To date, the company has not obtained a symbol and there has
been no trading activity.
The company has approximately 26 shareholders of record.
The company has not paid, nor does it anticipate paying dividends in the
foreseeable future.
Item 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
None.
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<PAGE>
Item 4. RECENT SALES OF UNREGISTERED SECURITIES.
The following securities were sold in reliance upon Section 4(2) of the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder. The company kept 100% of the proceeds from the sale of securities
and no underwriters were used and no commissions or discounts were paid.
<TABLE>
<CAPTION>
ISSUE NO. OF
DATE TITLE SHARES SHARES ISSUED TO CONSID. AMOUNT
- ---- ----- ------ ---------------- ------- ------
<S> <C> <C> <C> <C> <C>
11/12/98 Common 93,500 Stacy L. Bagley Cash $2,875
11/12/98 Common 94,000 Harold C. Bray Cash 2,925
11/12/98 Common 1,000 Raymond J. Carapella Cash 100
11/12/98 Common 500 Eugene Cassidy Cash 50
11/12/98 Common 500 David Covey Cash 50
11/12/98 Common 1,000 Sharon Coykendall Cash 100
11/12/98 Common 1,000 Joy B. Day Cash 100
11/12/98 Common 2,000 Jerry Diamond Cash 200
11/12/98 Common 500 Richard J. Diamond Cash 50
11/12/98 Common 500 Edward Forsythe Cash 50
11/12/98 Common 500 James Garland Cash 50
11/12/98 Common 1,000 Richard T. Grimes Cash 100
11/12/98 Common 1,000 Allen Hardy Cash 100
11/12/98 Common 1,000 Ricky A. Howe Cash 100
11/12/98 Common 1,000 Kathleen Lewis Cash 100
11/12/98 Common 1,000 James Mastropietro Cash 100
11/12/98 Common 85,000 Melan Properties, Inc. Cash 2,550
11/12/98 Common 120,000 Progressive Ventures Services 3,600
11/12/98 Common 1,500 Mario Scarpa Cash 150
11/12/98 Common 500 Nancy Schwartz Cash 50
11/12/98 Common 80,000 Janet Tucker Cash 3,100
11/12/98 Common 500 Betty Verplanck Cash 50
11/12/98 Common 1,000 William J. Hoge, Jr. Cash 100
11/12/98 Common 1,500 Terry N. Williams Cash 150
</TABLE>
Mr. Mastropietro was issued 1,000 restricted common shares of the company
in April 1996 as founder shares which he purchased for $100. TBC Investments,
Inc. purchased 2,000,000 restricted common shares of the company in October 1998
as control shares for $200.
Sentry Accounting, Inc. had two offerings under Rule 504; the first
offering was from October 16, 1998 through October 28, 1998 for $10,200 at $.03
per share and the second offering was from November 2, 1998 to November 10, 1998
for $5,000 at $.10 per share. All shares available under the first offering were
sold for a total of $10,200; however, only $3,000 was raised under the second
offering for an aggregate of $13,200. The company inadvertently failed to file a
Form D on its first offering and filed a single Form D after the second offering
which included all funds raised under both offerings. Of the 23 investors who
participated in the offerings, seven were accredited and 16 were non-accredited.
Page 10
<PAGE>
All investors were provided an investment package that included a detailed
subscription agreement detailing the company's business plan and other corporate
information, a purchaser questionnaire and current financial statements. All
investors were encouraged to speak directly with the company's officers to
answer any questions or to ask to inspect any other corporate documents.
Progressive Ventures International, Inc. received a total of 120,000 shares
of the company's common stock issued pursuant to Rule 504 in exchange for
services rendered under a consulting agreement dated October 15, 1998. To assist
the company in accomplishing its goals, Progressive provided specific services
including writing the business plan and research and development of the
marketing and advertising goals of the company. The consulting agreement called
for a fee of $4,600; $1,000 of which was paid in cash and $3,600 which was paid
by the issuance of the company's common stock at $.03 per share for a total of
120,000 shares.
The principals of the two business entities listed in the above table are
as follows: C. R. Kenner is President, Secretary and sole director of Melan
Properties, Inc. and Richard J. Diamond is President, Secretary and sole
director of Progressive Ventures International, Inc.
Item 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Florida law permits the indemnification of officers and directors who,
while acting in good faith, on behalf of the corporation, are made a party to or
are threatened in an action as a result thereof.
The Articles of Incorporation of the company provide that "if in the
judgment of a majority of the entire Board of Directors (excluding from such
majority any director under consideration for indemnification), the criteria set
forth in 607.0850(1) or (2), Florida Statutes, as then in effect, have been met,
then the corporation shall indemnify any director, officer, employee, or agent
thereof, whether current or former, together with his or her personal
representatives, devisees or heirs, in the manner and to the extent contemplated
by 607,0850, as then in effect, or by any successor law thereto."
Page 11
<PAGE>
SENTRY ACCOUNTING, INC
FINANCIAL STATEMENTS
DECEMBER 31, 1998
<PAGE>
TABLE OF CONTENTS
Page
--------------
Accountants' Report F-1
Balance Sheet F-2
Statement of Operations F-3
Statement of Changes in Stockholders' Equity F-4
Statement of Cash Flows F-5
Notes to Financial Statements F-6
<PAGE>
GUIDA & JIMENEZ, PA
CERTIFIED PUBLIC ACCOUNTANTS
1308 West Sligh Avenue
Tampa, Florida 33604
Report of Independent Certified Public Accountants
To the Board of Directors
Sentry Accounting, Inc
Lakeland, Florida
We have audited the accompanying balance sheet of Sentry Accounting, Inc. as of
December 31, 1998, and the related statements of operations, stockholders'
equity, and cash flows for each of the years in the two-year period ended
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 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 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 Sentry Accounting, Inc. at
December 31, 1998 and the results of operations and its cash flow for each of
the years in the two-year period ended December 31, 1998, in conformity with
generally accepted principles.
/s/ Guida & Jimenez
- --------------------
Guida & Jimenez
Tampa, Florida
January 29, 1999
F-1
<PAGE>
SENTRY ACCOUNTING, INC.
BALANCE SHEET
December 31, 1998
ASSETS
Cash $ 989
Other receivables
637
Prepaid expenses 1,900
--------
Total current assets 3,526
Deferred taxes - noncurrent
(net of valuation allowance of $304) 1,494
--------
TOTAL ASSETS $ 5,020
========
STOCKHOLDERS' EQUITY
Common stock, no par value, 50,000,000 shares authorized,
2,491,000 shares issued and outstanding 85,500
Accumulated deficit (80,480)
--------
5,020
--------
TOTAL STOCKHOLDERS' EQUITY $ 5,020
========
See accompanying notes and accountants' report.
F-2
<PAGE>
SENTRY ACCOUNTING, INC.
STATEMENT OF OPERATIONS
Years ended December 31, 1998 and 1997
1998 1997
--------- ---------
Revenue $ 23,000 $ 15,072
General & Administrative Expenses 100,465 21,640
--------- ---------
Operating Loss (77,465) (6,568)
Other Income/Expenses
Interest Expense (65) --
Loss on Sale of Stock -- (2,017)
--------- ---------
Net Loss Before Tax Benefit (77,530) (8,585)
Income Tax Benefit (1,216) (916)
--------- ---------
Net Loss $ (76,314) $ (7,669)
========= =========
See accompanying nots and accountants' report.
F-3
<PAGE>
<TABLE>
<CAPTION>
SENTRY ACCOUNTING, INC.
STATEMENT OF STOCKHOLDERS' EQUITY
From Inception (June 21, 1996) To December 31, 1998
Retained
Common Stock Earnings
----------------------------- (Accumulated
Shares Amount Deficit) Total
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
BALANCE, December 31, 1996 1,000 100 3,503 3,603
Net loss -- -- (7,669) (7,669)
--------- --------- --------- ---------
BALANCE, December 31, 1997 1,000 100 (4,166) (4,066)
Private sale of shares 2,000,000 68,600 -- 68,600
Reg. D, Rule 504 Offering:
For services rendered 120,000 3,600 -- 3,600
For shares sold 370,000 13,200 -- 13,200
Net loss -- -- (76,314) (76,314)
--------- --------- --------- ---------
BALANCE, December 31, 1998 2,491,000 $ 85,500 $ (80,480) $ 5,020
========= ========= ========= =========
See accompanying notes and accountants' report.
F-4
</TABLE>
<PAGE>
SENTRY ACCOUNTING, INC.
STATEMENT OF CASH FLOWS
Years ended December 31, 1998 and 1997
1998 1997
-------- --------
OPERATING ACTIVITIES
Cash received from clients $ 24,050 $ 14,023
Cash paid to:
Suppliers and employees (36,425) (15,810)
Lenders (65) --
Taxing authorities -- (745)
-------- --------
Net Cash Provided by (Used by)
Operating Activities (12,440) (2,532)
-------- --------
INVESTING ACTIVITIES
Proceeds from sale of marketable securities -- 2,358
-------- --------
Net Cash Provided by (Used by)
Investing Activities -- 2,358
-------- --------
FINANCING ACTIVITIES
Sale of capital stock 13,400 --
-------- --------
Net Cash Provided by (Used by)
Financing Activities 13,400 --
-------- --------
Net Increase (Decrease) in Cash 960 (174)
Cash at Beginning of Period 29 203
-------- --------
Cash at End of Period $ 989 $ 29
======== ========
See accompanying notes and accountants' report.
F-5
<PAGE>
SENTRY ACCOUNTING, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1998
NOTE 1: ORGANIZATION AND HISTORY
Sentry Accounting, Inc., a Florida corporation ("Sentry" or the "Company") was
incorporated on June 21, 1996, by Donald R. Mastropietro, its sole shareholder.
Sentry, formerly known as Sentry Communication Services, Inc., was formed for
the purpose of selling telephone calling cards and other similar products. In
October 1996, it was determined that the telephone calling card business would
not be a successful endeavor. In light of this fact, the Company changed its
name and its focus and began providing accounting and financial services to
various private and public companies. From October 1996 until the present,
Sentry's sole form of revenue has been derived from providing accounting
services. On September 30, 1998, Sentry issued 2,000,000 shares of its common
stock in exchange for a 30 day, non-interest-bearing promissory note totaling
$200 to TBC Investments, Inc ("TBC"), which was paid in full in October, 1998.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of Sentry Accounting, Inc. (the
Company) is presented to assist in understanding the Company's financial
statements. The financial statements and notes are representations of the
Company's management who is responsible for their integrity and objectivity.
These accounting policies conform to generally accepted accounting principles
and have been consistently applied in the preparation of the financial
statements.
Cash and Cash Equivalents
-------------------------
For purposes of the statement of cash flows, the Company considers all
short-term debt securities purchased with a maturity of three months or less to
be cash equivalents.
Amortization of Organizational Costs
------------------------------------
The costs of organizing and preparing the Company to execute its business
objectives are expensed as incurred under SOP 98-5.
Income Taxes
------------
Deferred income taxes are provided for temporary differences between financial
statement and income tax reporting, primarily from temporary deductible
differences and net operating loss carryforwards.
F-6
<PAGE>
SENTRY ACCOUNTING, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1998
NOTE 3: COMMON STOCK
The Company has 50,000,000 shares of common stock authorized with no par value,
of which 2,491,000 shares have been issued as of December 31, 1998.
The stockholder's equity section reflects the initial issuance of 1,000 shares
of common stock, which were issued to Donald R. Mastropietro for a consideration
of $100. On September 30, 1998, 2,000,000 shares of common stock were sold to
TBC Investments, Inc. at a substantial discount for $200. $68,400 representing
the discount was recorded to compensation expense for 1998.
In October and November 1998 the Company conducted two stock offerings covered
under Regulation D, Rule 504. The Company's first offering, which took place
during the period from October 16 through October 28, 1998, consisted of 340,000
shares of common stock at $0.03 per share totaling $10,200. The Company's second
offering, which took place during the period from November 2 through November
10, 1998, consisted of 30,000 of common stock at $0.10 per share totaling
$3,000.
On October 15, 1998, the Company entered into a consulting agreement with
Progressive Ventures International, Inc. ("Progressive"), whereby Progressive
would perform certain consulting services for the Company in exchange for a fee
of $4,600. Payment for said fee was made by the payment of $1,000 in cash and
the issuance of 120,000 shares of common stock at $0.03 per share, issued
pursuant to regulation D, Rule 504. Said issuance was made as a part of the
Company's first offering which took place during the period from October 16
through October 28, 1998. Of the $3,600, $2,300 had been invoiced by Progressive
by December 31, 1998, leaving a prepaid expense balance of $1,300 as reflected
on the accompanying Balance Sheet.
(This space intentionally left blank)
F-7
<PAGE>
SENTRY ACCOUNTING, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1998
NOTE 4: INCOME TAXES
Net deferred tax assets in the accompanying balance sheet includes the following
components:
Net operating loss carryforward - 1997 $ 204
Net operating loss carryforward - 1998 1,216
Temporary deductible differences 378
-------
Total deferred tax asset 1,798
Less: valuation allowance (304)
-------
Net deferred tax asset $ 1,494
=======
The Company's net operating losses available for carryforward to offset future
taxable income for income tax reporting purposes expire in the years 2018 and
2019.
F-8
<PAGE>
PART III
Item 1. INDEX TO EXHIBITS.
Exhibit Description of Document
- ------- -----------------------
3(i) Articles of Incorporation filed June 27, 1996.*
3(ii) Articles of Amendment to the Articles of Incorporation filed
November 25, 1996.*
3(iii) Bylaws.*
10.0 Consulting Agreement between Sentry Accounting, Inc. and
Progressive Ventures International, Inc. dated October 15,
1998.**
23.0 Consent of Accountants.*
27.0 Financial Data Schedule.*
99.0 Stock Certificate, Form of.*
* Previously submitted.
** Submitted herewith.
Item 2. DESCRIPTION OF EXHIBITS.
The required exhibits are attached hereto, as noted in Item 1 above.
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
SENTRY ACCOUNTING, INC.
Date: May 3, 1999 By: /s/ Teresa B. Crowley
-------------- ------------------------------
Teresa B. Crowley, President
Page 12
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made this 15th day of
October, 1998, by and between Sentry Accounting, Inc., a Florida corporation
whose business address is 1509 S. Florida Avenue, Suite 2, Lakeland, FL 33803
(the "Company"), and Progressive Ventures International, Inc., whose business
address is 1726 E. 7th Avenue, Tampa, FL 33605 (the "Consultant").
BACKGROUND INFORMATION
The Company desires to move forward with its proposed business plan and
intends to hire Consultant in that regard. The Consultant has agreed to consult
with the officers and directors of the Company and to assist the Company in
accomplishing its goals, including (i) preparing the necessary documentation to
become listed on the OTC Bulletin Board, (ii) preparing the necessary
documentation to become listed with Standard & Poors, (iii) and any other
services requested from time to time by the Company.
THEREFORE, the parties agree as follows:
OPERATIVE PROVISIONS
SECTION 1
CONSIDERATION AND TERM
1. Consideration. The Company shall pay the Consultant for services
performed under this Agreement a total of $4,600, as follows: $1,000 in cash and
$3,600 in the form of common stock of the Company, issued under the anticipated
504 offering at $.03 per share (or 120,000 shares).
2. Term. The term of this Agreement shall be for six months from the date
of the Agreement.
SECTION 2
MISCELLANEOUS
3. Entire Agreement. This instrument contains the entire agreement of the
parties. There are no representations or warranties other than as contained
herein. The Company shall indemnify and hold harmless the Consultant from and
against any losses, claims, damages or liabilities related to or arising out of,
any services rendered to the Company pursuant to the terms of this Agreement. No
waiver or modification hereof shall be valid unless executed in writing with the
same formalities as this Agreement. Waiver of the breach of any term or
condition of this Agreement shall not be deemed a waiver of any other or
subsequent breach, whether of like or of a different nature.
<PAGE>
4. Florida Law. This Agreement shall be construed according to the laws of
the State of Florida (exclusive of the conflicts of law provisions thereof) and
shall be binding upon the parties hereto, their successors and assigns.
5. Venue. The Consultant and the Company each agree that any legal or
equitable action or proceeding with respect to this Agreement shall be brought
in any Federal or State court of competent jurisdiction located in the County of
Hillsborough, City of Tampa, and, by execution and delivery of this Agreement,
each accepts for themselves and their property, generally and unconditionally,
the exclusive jurisdiction of the aforesaid courts and any related appellate
court with respect to this Agreement, and irrevocably agree to be bound by any
judgment rendered thereby in connection with this Agreement, and irrevocably
waive any obligation they may not or hereafter have as to the venue of any such
action or proceeding brought in such a court or that such court is an
inconvenient forum. The Company and the Consultant each consent to the service
of process of any of the aforementioned courts in any such action or proceeding
by mailing of copies thereof by registered mail, postage prepaid, such service
to become effective three business days after such mailing. In any such
proceeding, the prevailing party shall be entitled to an award of fees and
disbursements of counsel.
6. Waive Jury Trial. The Company and the Consultant each hereby waive trial
by jury in any judicial proceeding brought by either of them with respect to
this agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
SENTRY ACCOUNTING, INC.
By: /s/ Teresa B. Crowley
-----------------------------------
Teresa B. Crowley, President
PROGRESSIVE VENTURES
INTERNATIONAL, INC.
By: /s/ Richard J. Diamond
-----------------------------------
Richard J. Diamond, President
Exhibit 23.0
GUIDA & JIMENEZ, PA
CERTIFIED PUBLIC ACCOUNTANTS
1308 West Sligh Avenue
Tampa, Florida 33604
Consent Of Independent Certified Public Accountant
We hereby consent to the use in this Registration Statement on Form 10 of our
report included herein dated January 29, 1999, relating to the financial
statements of Sentry Accounting, Inc.
/s/ Guida & Jimenez
-----------------------------------------
Guida & Jimenez, P.A.
Tampa, Florida
February 3, 1999
