SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 KSB/A
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended September 30, 2000
Commission File No. 0-27175
ADVANCE TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Nevada 95-475536
(State or other (I.R.S. Employer
Jurisdiction of Incorporation Identification No.)
or organization)
716 Yarmouth Road # 215
Palos Verdes Estates, CA 90275
(Address of principal executive offices)
Registrant's telephone number, including area code:
(310) 265-7776
Securities Registered Pursuant to Section 12(b) of the Act:
Title of each class
Common
Name of Each exchange on which registered
National Association of Securities Dealers
Securities registered pursuant to Section 12(g) of the Act:
_________________________________
Indicate by check mark whether the
Registrant (1) has 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
Advance Technologies, Inc. Form 10 KSB/A
Indicate by check mark if disclosure of
delinquent filers pursuant to item 405 of Regulation
S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in
definitive proxy or information statements
incorporated by reference in part III of this Form
10-KSB or any amendment to this Form 10-KSB. [X]
The aggregate market value of voting stock
held by non-affiliates of the Registrant as of September 30,
2000 was approximately $3,859,384.50
On September 30, 2000, approximately 2,572,923
Shares of the Registrant's Common Stock, $0.001 par
value, were outstanding.
Documents Incorporated by Reference
(1) Financial Statements for September 30,
2000
(2) Except for the historical information
presented, the matters discussed in this Form 10 KSB
include forward-looking statements that involve
risks and uncertainties. The Company's actual
results could differ materially from those discussed
herein. Factors that could cause or contribute to
such differences include, but are not limited to,
those discussed under the caption "Factors That
May Affect Future Results" under "Management's
Discussion and Analysis of Financial Condition and
Results of Operations" in the Company's 2000
Financial Statements, which is incorporated by
reference in this Form 10-KSB.
Advance Technologies, Inc. Form 10 KSB/A 2
ADVANCE TECHNOLOGIES, INC.
TABLE OF CONTENTS
Page
PART I
Item 1. BUSINESS . . . . . . . . . . . . . . . . . . 3
Item 2. PROPERTIES . . . . . . . . . . . . . . . . . 6
Item 3. LEGAL PROCEEDINGS . . . . . . . . . . . . . 6
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS . . . . . . . . . . . . . . . . . . . 6
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS . . . . . . . . . . . . 6
Item 6. SELECTED FINANCIAL DATA . . . . . . . . . . 6
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS . . . . 7
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA . . . . . . . . . . . . . . . . . . . . 7
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE. . . . . 7
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT . . . . . . . . . . . . . . . . . 7
Item 11. EXECUTIVE COMPENSATION . . . . . . . . . . . 8
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT . . . . . . . . . . . . . . . 9
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 9
Advance Technologies, Inc. Form 10 KSB/A 3
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
REPORT . . . . . . . . . . . . . . . . . . . 10
SIGNATURES . . . . . . . . . . . . . . . . . 11
PART I
Item 1. Business
Introduction
Advance Technologies, Inc. ("the Company") The Company
was organized under the laws of the State of Delaware under
the name PWB Industries, Inc., the articles of incorporation
were issued June 16, 1969. The name was changed to Sun
Energy, Inc. ("The Company"), which merged with Sto Med,
Inc. on February 22, 1996 changing its name to Sto Med, Inc.
("The Company") and domicile to the State of Nevada. On
February 23, 1996, Sto Med, Inc., a privately held California
corporation, was acquired by Sto Med, Inc. ("The Company")
the California Corporation acquisition was rescinded on
August 23rd 1997. Sto Med Inc. ("The Company") the Nevada
corporation changed its name to Advance Technologies, Inc.,
("The Company") on August 23rd 1997. On September 27,
1999 the "Company" acquired Seacrest Industries of Nevada,
also known as Infrared Systems International.
The Company
The Registrant through its wholly owned subsidiary
SEACREST INDUSTRIES, INC., and through its president
and director Mr. Gary Ball was granted an exclusive world-
wide license agreement for the use of US patent number
5,534,694 by Hughes Aircraft Company, for a key optical
element of the Infrared Aircraft Landing System. Gary Ball
founder and CEO of Infrared Systems International (ISI) a/k/a
Seacrest Industries International, Inc. in 1992 formed the
company for the singular purpose of providing manufacturing
and sales support for the unique Infrared System called
Enhanced Vision System (EVS). While employed by Electro-
Advance Technologies, Inc. Form 10 KSB/A 4
Optical Systems, a segment of Hughes Aircraft Company, as
senior Program Manager and engineer, he led the research and
development team responsible for the development of the
Enhanced Vision System (EVS). This technology was designed
to allow aircraft pilots to actually "see" the airport
environment through cloud ceiling or surface fog. The factor
of enhanced safety, alone, is generating an enormous demand
for this type of system, which, in the future, could become part
of the Minimum Equipment List (MEL) required for
commercial aircraft carrying more than a designated number
of passengers (FAA Part-91, -121, & -135 markets). Millions of
dollars have been expended in the development of this
technology by many major Corporations.
In June of 1992, Gary E Ball was employed as the Program
Manager of EVS at Hughes Aircraft Company where he
developed the technology, including the principal patent,
licensed to the Company. In October of 1995, in connection
with certain strategic business decisions being made by Hughes
Aircraft, Hughes Aircraft offered Mr. Gary E. Ball a license of
the EVS technology. The license included the patent submitted
by Mr. Gary E. Ball and others, together with proprietary data
related to the technology, proprietary business agreements,
and unrestricted use of the licensed information and EVS
knowledge acquired while Mr. Gary Ball was at Hughes
Aircraft.
The license agreement with Hughes required prepayment of
($25,000) and a royalty on each licensed product sold. The
license is exclusive and limited to the use of the technology
relating to commercial aircraft licensed to operate by the
United States Federal Aviation Administration or equivalent
regulatory agency elsewhere. This agreement requires the
consent of Hughes Aircraft to sublicense the technology, which
consent will not be unreasonably withheld.
In July of 1997, ISI entered into a license agreement with
Kollsman, Inc. which contemplates the payment of a royalty to
ISI based upon the number of licensed products sold by
Kollsman and requires the personal consulting services of Mr.
Gary E. Ball for which the Company will receive
compensation. This agreement entitles ISI to an advanced
royalty of $5,000 per month plus time and expenses for
consulting service as well as an initial $20,000 advance
Advance Technologies, Inc. Form 10 KSB/A 5
payment. The royalty based upon sales increases, as the
number of systems sold increases.
Kollsman, Inc. is a commercial avionics and electronics
company that designs, develops and manufactures flight
instruments. It is a leading developer of Forward Looking
Infrared Systems. These systems have primarily been utilized
in military applications. The system designed by Kollsman
that utilizes the Company's technology is based upon an
infrared sensor unit placed in the nose of the aircraft. Output
from the sensor unit is transmitted through a video interface
onto a heads-up-display located on the aircraft's flight deck.
The image displays the approach on a high quality black and
white television image projected onto a combining glass in
front of the Captain. The result is that night vision is
enhanced and a pilot has the ability to see through fog, smoke,
haze, rain and snow. In addition to improved situational
awareness of the airport, traffic and surrounding terrain, the
takeoff and landing "Minima" results in fewer diversions,
cancellations and delays.
In October of 1997, Gulfstream, the leading manufacturer of
large business aircraft, and Kollsman announced the signing of
a memorandum of understanding to utilize the Company's
technology on Gulfstream IV-SP and Gulfstream V aircraft.
Gulfstream announced it is preparing for pre-prototype flight
tests whose goal is to utilize the technology where the visual
ceiling is no more than 50 feet and the runway visual range is
no more than 700 feet.
While the Company's primary efforts are directed toward
supporting the Kollsman license, the Company is pursuing
other areas of development for the Enhanced Vision System
(EVS) Technology. Not only can the technology be used in a
variety of cameras to reveal images through clouds or smoke
but also to reveal critical characteristics that would otherwise
not be seen in paintings and livestock. There are a multitude of
medical applications, applications for preventive maintenance,
uses in underwater imaging systems and emergency vehicle
warning systems, ground transportation (commercial and
recreational), fire fighting, vehicle, airborne and man-portable,
and all types of maritime transportation.
Advance Technologies, Inc. Form 10 KSB/A 6
Item 2. Properties
The Company's executive offices are located in
Palos Verdes Estates, California.
Item 3. Legal Proceedings
There are no legal proceedings known or pending against
the Registrant or its subsidiary
Item 4. Submission of Matters to a Vote of
Security Holders
There were no shareholders meetings held in the period
ending September 30, 2000.
PART II
Item 5. Market for Registrant's Common Equity
and Related Stockholder Matters
The Company is currently trading, OTC, on
the Nationals Association of Securities Dealers "Pink
Sheets" with the high bid at $1.75 per share and the low bid
of $1.375 per share during the last quarter. Additional
information required by this item may be found in
the Company's 2000 Financial Statements and is
incorporated herein by reference.
On October 4, 1999 there was an escrow established by the
Company at Pacific Stock Transfer Company for 50,204,102
Shares of preferred stock for the exchange of Seacrest
Industries, Inc. common stock in conjunction with its
acquisition. As of September 30, 2000 43,123,202 shares of
Seacrest had been exchanged
Advance Technologies, Inc. Form 10 KSB/A 7
Item 6. Selected Financial Data
The information required by this item is set forth in the
Company's 2000 Financial Statements and is incorporated
herein by reference.
Item 7. Management's Discussion and Analysis of Financial
Condition and Reports of Operation
The information required by this item is set forth in the
Company's 2000 Financial Statements and is incorporated
herein by reference.
Item 8. Financial Statements and Supplemental Data
The financial statements required by this item are
included in the Company's 2000 Financial Statements
and are incorporated by reference. With the exception
of the aforementioned information and the information
incorporated in Items 5, 6 and 7, the Company's
2000 Financial Statement is not to be deemed filed
as part of this Form 10-KSB Annual Report. The
report of the Company's Independent Auditors on
the Company's consolidated financial statement is
included in the Company's 2000 Financial Statement and is
incorporated by reference. The report of the Company's
Independent Auditors on the financial statement schedule
required by this item is included herein.
Item 9. Changes in and Disagreements with
Accountants on Accounting Financial Disclosure
PART III
Item 10. Directors and Executive Officers of the
Registrant
GARY E. BALL Age 63, residing in Beverly Hills, California is
married. He attended California State University at Long
Advance Technologies, Inc. Form 10 KSB/A 8
Beach graduating in 1967 BSEE and MSEE, went on to
perform Graduate Studies at University of Southern
California. He has specialized in product design, development,
and management for North American Aviation, Autonetics
Division. Technical Manager in charge of the Pave Track
program for Ford Aerospace. Program Manager for Northrop
Electro-Mechanical in charge of business development on
several classified DOD programs, including the AMRAAM
effort. Program Manager for Hughes Aircraft where he
developed the Infrared Enhanced Vision System, reporting to
the President of EDSG as directed by General Motors and
directed all non-core business. He is a member of NATO
NIAG study group on Aircraft Integration. He has authored
several articles for trade publications, the last 4 years he has
provided consulting services to 10 U.S. and foreign
corporations in the field of IR technology.
GARY L. BANE Age 63, residing in Santa Barbara, California
is married. He attended University of Southern California
attaining BS Mechanical and Aeronautical (1960) MS Control
Systems and Instrumentation (1966) MS Systems Management
(1968). University of California, Los Angeles studying Deep
Submergence Vehicle, Oceanography and Offshore Systems
Engineering. Stanford University Executive Institute of
Management of High Technology Companies. Mr. Bane is a
specialist in the development and management of Deep Ocean
and offshore technology projects. He recently retired from
Rockwell after 30 years as director of Ocean Systems. While at
Rockwell he successfully managed significant technical
solutions and advanced state-of-the-art programs for a number
of classified programs. He was General Manager of Interstate
Electronics; Oceanic Division where he was responsible for
profit and loss and R and D for offshore oil drilling and
recovery projects.
WENDY BALL Age 54, residing in Beverly Hills, California is
married. She graduated from University of Southern
California, BS cum Laude. Her career has been focused on
retail merchandising, where she has demonstrated exceptional
skills in management, team building and communications. She
was a key employee at Neiman Marcus Beverly Hills where she
increased sales 400% in the Christian Lacroix Boutique and
was a key buyer in New York. She was an account executive
for Carolee Jewelry for Southern California, Arizona and Utah
Advance Technologies, Inc. Form 10 KSB/A 9
increasing sales 84%. She was co-owner Brava Specialty
Clothing Store in Redondo Beach, California.
Item 11. Executive Compensation
Other than information provided in the
Company's 1999 Financial Statements incorporated
herein, executive officers and directors have
received no other compensation.
Item 12. Security Ownership of Certain
Beneficial Owners and Management
Title (1)Name & (2)Amount & Percent of
Of Class Address of Nature of Class
Beneficial Owner Beneficial Ownership
Preferred Gary E. Ball 9,240,000 Issued Shares 18.4
28 Santa Cruz Court
Manhattan Beach, CA 90266
Preferred Gary L. Bane 364,000 Issue Shares 1.0
2015 Edgewater
Santa Barbara, CA 93109
Preferred Wendy Ball 9,240,000 Issued Shares 18.4
28 Santa Cruz Court
Manhattan Beach, CA 90266
Item 13. Certain Relationships and Related Transactions
Gary E. Ball and Wendy Ball are married.
The consideration exchanged under the Plan was negotiated
between the directors and executive officers of the Registrant,
the Board of Directors of SEACREST INDUSTRIES, INC.
(the board of directors of the Registrant, are the same board of
directors as that of SEACREST INDUSTRIES, INC.) and the
Advance Technologies, Inc. Form 10 KSB/A 10
SEACREST INDUSTRIES, INC. Stockholders, and the Board
of Directors of the Registrant used criteria used in similar
proposals involving the Registrant in the past, including the
relative value of the assets of the Registrant; its present and
past business operations; future potential of SEACREST
INDUSTRIES, INC.; its management; and the potential
benefit to the stockholders of the Registrant. The members of
the Board of Directors determined in their good faith that the
consideration for the exchange was reasonable, under these
circumstances.
PART IV
Item 14. Exhibits, Financial Statement
Schedules, and Reports on Form 8-K
The following documents are filed as part of this
Form 10-KSB Annual Report:
1) Financial Statements
Advance Technologies, Inc.
(a Development Stage Company)
Consolidated Financial Statements
September 30, 2000
C O N T E N T S
Independent Auditor's Report 3
Consolidated Balance Sheets 4
Consolidated Statements of Operations 5
Consolidated Statements of Stockholders' Equity 6
Consolidated Statements of Cash Flows 7
Notes to the Consolidated Financial Statements 8
Chesholm & Associates
Certified Public Accounts
A Professional P.O. Box 540216 Office (801) 292-8756
Corporation North Salt Lake, Utah 84054 Fax (801) 292-8809
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Advance Technologies, Inc.
We have audited the accompanying consolidated balance sheet
of Advance Technologies, Inc. (a Development Stage Company)
as of September 30, 2000 and the related statements of
operations, stockholders' equity and cash flows for the years
ended September 30, 2000 and 1999 and from inception on October
1, 1985 though September 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 audits. The financial statements for the
period October 1, 1985 through September 30, 1995 were audited by
other accountants, who expressed an unqualified opinion on their
report dated February 12, 1996.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Advance Technologies, Inc. (a Development Stage
Company) as of September 30, 2000 and the results of its
operations and cash flows for the years ended September
30, 2000 and 1999 and from inception on October 1, 1985 through
September 30, 2000 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 2 to the financial statements, the Company has
minimal assets and is dependent upon financing to continue
operations. These factors raise substantial doubt about its
ability to continue as a going concern. Management's plans in
regard to these matters are also described in the Note 2. The
financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ Chisholm & Associates
Salt Lake City, Utah
December 27, 2000 Fin 3
Advance Technologies, Inc.
(a Development Stage Company)
Consolidated Balance Sheets
Assets
September 30,
2000
Current assets
Cash $ 1,646
Prepaid License (Note 4) 12,500
__________
Total Current Assets 14,146
__________
Property & Equipment 23,835
(net of accumulated depreciation)(Note 8)
Total Assets $ 37,981
__________
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable $ 27,291
Accrued wages 7,000
Accrued interest 2,816
Note Payable-Officer (Note 7) 49,500
Advance Royalties (Note 5) 25,000
__________
Total Current Liabilities 111,607
__________
Long Term Debt
Line of Credit (Note 9) 79,500
Total Liabilities 191,107
__________
Stockholders' Equity
Common Stock, authorized 100,000,000 shares of $.001
par value, issued and outstanding 2,572,923 shares 2,573
Preferred Stock, Series A authorized 100,000,000
shares of $.001 par value, issued and outstanding
50,204,102 shares 50,204
Additional Paid in Capital 446,496
Deficit Accumulated During the Development Stage (652,399)
__________
Total Stockholders' Equity (153,126)
__________
Total Liabilities and Stockholders' Equity $ 37,981
__________
The accompanying notes are an
integral part of these financial statements Fin 4
Advance Technologies, Inc.
(a Development Stage Company)
Consolidated Statements of Operations
Cumulative
For the Total since
Years ended inception of
September 30, development
2000 1999 stage
________ ________ __________
Revenues: $ - $ - $ -
Expenses:
Depreciation & Amortization 14,665 - 14,665
Interest 2,816 - 2,816
Organization Costs - 11,331 11,331
Research & Development 11,250 - 11,250
General and administrative 73,068 78,795 551,638
________ ________ __________
Total Expenses 101,799 91,126 591,700
________ ________ __________
Net (Loss) $ (101,799) $(90,126) (591,700)
________ ________ __________
Net Loss Per Share $ (0.03) $ (0.07) (1.85)
________ ________ __________
Weighted average shares outstanding
2,572,923 1,322,924 319,374
________ ________ __________
The accompanying notes are an
integral part of these financial statements Fin 5
Advance Technologies, Inc.
(a Development Stage Company)
Consolidated Statement of Stockholders' Equity
Deficit
Accumulated
Additional During the
Common Stock paid-in Preferred Stock Development
Shares Amount capital Shares Amount Stage
______ ______ _______ _______ ______ __________
Balance, October 1, 1985
(beginning of the development stage)
6,487 $ 7 $58,161 $ - $ - $ (60,701)
Shares issued for coal royalties at $0.01
4,369 4 1,525 - - -
Shares issued for services at $0.25
554 1 4,849 - - -
Shares issued for services at $0.03
1,601 2 1,680 - - -
Shares issued for services at $0.25
1,274 1 11,145 - - -
Shares issued for services at $0.01
2,290 2 798 - - -
Shares issued for services at $0.25
37,203 37 325,487 - - -
Preferred shares issued for services
- - - 10,048 1,004 -
Expiration of preferred shares
- - 1,004 (10,048) 1,004) -
Net loss since the beginning of the development
stage at October 1, 1985
- - - - - (344,001)
______ ______ _______ _______ ______ __________
Balance, September 30, 1995
53,778 54 404,649 - - (404,702)
Shares issued for services at $0.25
5,714 6 49,994 - - -
Fractional shares adjustment
(6) (1) - - - -
Net loss for the year ended September 30, 1996
- - - - - (50,000)
______ ______ _______ _______ ______ __________
Balance September 30, 1996
59,486 59 454,643 - - (454,702)
Shares issued for services at $0.25
609 1 5,324 - - -
Net loss for the year ended September 30, 1997
- - - - - (5,325)
______ ______ _______ _______ ______ __________
Balance September 30, 1997
60,095 60 459,967 - - (460,027)
Shares issued for services at $0.001
12,828 13 436 - - -
Net loss for the year ended September 30, 1998
- - - - - (447)
______ ______ _______ _______ ______ __________
Balance September 30, 1998
72,923 73 460,403 - - (460,474)
Shares issued for cash at $0.01
2,500,000 2,500 22,500 - - -
Shares issued for common stock of SeaCrest
Industries Corporation at $0.001
- - (36,407)50,204,102 50,204 -
Net loss for the year ended September 30, 1999
- - - - - (90,126)
______ ______ _______ _______ ______ __________
Balance September 30, 1999
2,572,923 2,573 446,496 50,204,102 50,204 (550,600)
Net loss for the year ended September 30, 2000
- - - - - (101,799)
______ ______ _______ _______ ______ __________
Balance September 30, 2000
2,572,923 $2,573 $446,496 50,204,102 $50,204 $ (652,399)
______ ______ _______ _______ ______ __________
The accompanying notes are an
integral part of these financial statements Fin 6
Advance Technologies, Inc.
(a Development Stage Company)
Consolidated Statement of Cash Flows
October 1,
(inception of
For the development
year ended stage) to
September 30, September 30,
2000 1999 2000
_______ _______ _______
Cash Flows from Operating
Activities
Net loss $(101,799) $(90,126) $(591,700)
Adjustments to reconcile
net loss to net cash
provided by operations:
Depreciation &
Amortization 14,665 - 14,665
Decrease in Prepaids 2,180 - 2,180
Increase in Accounts Payable
& accrued expenses 31,045 6,064 37,109
Stock issued for services - - 399,775
Organization Costs - 11,331 11,331
_______ _______ _______
Net cash flows provided
(used) by operating activities
(53,909) (72,731) (126,640)
_______ _______ _______
Cash Flows from Investment
Activities:
Purchase of Equipment (26,000) - (26,000)
Investment in Subsidiary - 286 286
_______ _______ _______
Net cash flows provided
(used) by investing activities
(26,000) 286 (25,714)
Cash Flows from Financing
Activities:
Cash paid on officer loan - (12,000) (12,000)
Proceeds from
Loan from officer 1,500 60,000 61,500
Proceeds from
Line of Credit 79,500 - 79,500
Net proceeds
from issuance of stock - 25,000 25,000
_______ _______ _______
Net cash flows provided
(used) by operating activities
81,000 73,000 154,000
_______ _______ ________
Net increase
(decrease) in cash 1,091 555 1,646
Cash, beginning of year 555 - -
_______ _______ _______
Cash, end of year $ 1,646 $ 555 $ 1,646
_______ _______ _______
The accompanying notes are an
integral part of these financial statements Fin 7
Advance Technologies, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2000
NOTE 1 - Summary of Significant Accounting Policies
a. Organization
The Company was organized under the laws of the state of
Delaware on June 16, 1969 as PWB Industries, Inc. On November
10, 1975, the Company changed its name to Sun Energy, Inc. At
that time the Company began operations in the oil and gas lease
industry. By 1985 the Company discontinued its operations and
became dormant. On March 6, 1996 the Company attempted a
merger that eventually failed. On August 23, 1997 the Company
changed its name to Advance Technologies, Inc. and moved its
state of domicile to the state of Nevada.
On September 27, 1999 pursuant to a plan of acquisition, the
Company exchanged 50,204,102 shares of its Series "A" preferred
stock for SeaCrest Industries Corporation's 50,204,102 shares of
common stock. This acquisition has been accounted for using the
purchase method of a business combination.
The company is currently engaged in the development of a night
vision system with applications in the military as well as civil.
The company has an agreement with a Taiwan company wherein they
are jointly developing the night vision system for use in Class A
coaches. The company is also involved in the development of other
Electro-optical mechanical devices.
b. Accounting Method
The Company recognizes income and expense on the accrual
basis of accounting.
c. Consolidation
The consolidated financial statements include the accounts
of Advanced Techologies, Inc. and SeaCrest Industries
Corporation, a wholly owned subsidiary. Intercompany
transactions have been eliminated.
Fin 8
d. Earnings (Loss) Per Share
The computation of earnings per share of common stock is
based on the weighted average number of shares outstanding at
the date of the financial statements.
e. Cash and Cash Equivalents
The Company considers all highly liquid investments with
maturities of three months or less to
be cash equivalents.
f. Provision for Income Taxes
No provision for income taxes has been recorded due to net
operating loss carryforwards totaling approximately $(636,000)
that will be offset against future taxable income. These NOL
carryforwards begin to expire in the year 2004 No tax benefit has
been reported in the financial statements because the Company
believes there is a 50% or greater chance the carryforward will
expire unused.
Deferred tax assets and the valuation account is as follows:
September 30,
2000
_________
Deferred tax asset:
NOL carrryforward $ 216,000
Valuation allowance (216,000)
___________
Total $ -
___________
g. Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect reported amounts of
assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements and expenses
during the reporting period. In these financial statements,
assets and liabilities involve extensive reliance on management's
estimates. Actual result could differ from those estimates.
Fin 9
Advance Technologies, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2000
NOTE 2 - Going Concern
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern. The
Company has few assets and has had recurring operating losses and
is dependent upon financing to continue operations. The
financial statements do not include any adjustments that might
result from the outcome of this uncertainty. It is management's
plan to finish development of its night vision technology and
begin to market their product to generate the necessary revenue.
NOTE 3 - Development Stage Company
The Company is a development stage company as defined in
Financial Accounting Standards Board Statement No. 7. It is
concentrating substantially all of its efforts in raising capital
and developing its business operations in order to generate
significant revenues.
NOTE 4 - Prepaid License Agreement
SeaCrest Industries Corporation, formerly Infrared Systems
International, Inc., entered into a licensing agreement with
Hughes Aircraft Company for an infrared landing aid system.
Hughes Aircraft Company was paid $25,000 on October 25, 1995 upon
commencement of the agreement. There is also a $1,000 royalty
payment due to Hughes Aircraft Company for each unit sold. The
first twenty units sold, $20,000, will be deducted from the
original $25,000 deposit. There were no units sold during the
2000 fiscal year and the project is currently on hold status, but
is yet a viable project, therefore management has amortized
$12,500 of the original $25,000 prepaid expense.
Fin 10
NOTE 5 - Advanced Royalties
SeaCrest Industries Corporation, formerly Infrared Systems
International, Inc., entered into a licensing agreement for
marketing and distributing of infrared aircraft landing systems.
Seacrest received $25,000 in advances. These royalty revenues
have been deferred until future revenue streams, if any occur,
and has been recorded as a liability.
NOTE 6 - Stock Transactions
On December 2, 1998 and August 23, 1997, the Company's board
of directors authorized a reverse stock split, 1 share for 35
shares and 1 share for 10 shares, respectively. The financial
statements have been retroactively restated to show the effects
of the reverse stock split.
NOTE 7 - Related Party Transactions
Since the Company does not have the necessary operating
revenue to sustain operations, stock has been issued for service.
Some of the parties receiving stock are related parties,
including officers of the Company.
During 1999, an officer of the Company advanced $60,000 to
cover expenses. $12,000 was subsequently paid back leaving a note
payable of $48,000 at September 30, 1999. During the fiscal
year 2000, this officer advanced $1,500 to the company and the
balance of the note payable is $49,500. The note payable-officer
is considered a current liability with no provisions for
interest.
During 1999, the officers of the Company paid their own
travel expenses. The amount payable to the officers at September
30, 1999 is $4,846, which was subsequently paid in fiscal 2000,
leaving a balance of $0.
Fin 11
NOTE 8 - Property & Equipment
Property & Equipment consists of the following at September 30,
2000:
Equipment-Lens $26,000
Accumulated Depreciation (2,165)
_________
Net Property & Equipment $23,835
_________
Expenditures for property and equipment and for renewals and
betterments, which extend the originally estimated economic life
of assets or convert the assets to a new use, are capitalized at
cost. Expenditures for maintenance, repairs and other renewals of
items are charged to expense. When items are disposed of the cost
and accumulated depreciation are eliminated from the accounts,
and an gain or loss is included in the results of operations.
The provision for depreciation is calculated using the
straight-line method over the estimated useful lives of the
assets. The useful lives of equipment are 5 years. Depreciation
expense for the year ended September 30, 2000 is $2,165.
NOTE 9 - Line of Credit
The Company has negotiated a Line of Credit with a
corporation, wherein the Company has a credit limit of $125,000.
The Company received advances of $79,500 as of September 30,
2000, and has recorded accrued interest of $2,816 in connection
with the advances. The principal and interest is due January 1,
2004.
NOTE 10 - Subsequent Events
In October 2000, the Company received $49,000 from a Taiwan
corporation pursuant to an agreement to jointly develop a night
vision system to be used by Class A coaches. The agreement
provides for the receipt of $96,000 in working capital and
equipment to be provided from the Taiwan company valued at
$100,000.
Fin 12
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the Company has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Advance Technologies, Inc.
Date: 1/19/2001 By: /s/ Gary E. Ball
Gary E. Ball
President, Director
Advance Technologies, Inc. Form 10 KSB/A 11
