U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-KSB
[X] Annual report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended
September 30, 1999, or
[ ] Transition report pursuant to section 13 or 15(d) of the
Securities Exchange act of 1934 for the transition period from
to
Commission File No. 0-26347
FUTURE TECHNOLOGIES, INC.
(Name of Small Business Issuer as specified in its charter)
Minnesota 41-0985135
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
11900 Wayzata Blvd., Suite 100, Hopkins, MN 55305
(Address of Principal Executive Offices and Zip Code)
Issuer's Telephone Number: (612) 541-1155
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act:
Common Stock, Par Value $0.01
Check whether the issuer (1) filed all reports required to be
filed by sections 13 or 15(d) of the Exchange Act during the past
12 months (or such shorter period that the issuer 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 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. [X]
The issuer's revenues (consisting only of interest income) for
its most recent fiscal year: $0.
The aggregate market value of voting stock held by non-affiliates
computed on the basis of the last sale price on March 4, 1999,
was $3,480.
As of September 30, 1999, the Registrant had outstanding
1,348,089 shares of Common Stock, par value $0.01.
Documents incorporated by reference: None.
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TABLE OF CONTENTS
ITEM NUMBER AND CAPTION Page
Part I
1. Description of Business 3
2. Description of Properties 7
3. Legal Proceedings 7
4. Submission of Matters to a Vote of Security Holders 7
Part II
5. Market for Common Equity and Related Stockholder 8
Matters
6. Management's Discussion and Analysis of Financial 8
Condition and Results of Operations
7. Financial Statements 9
8. Changes in and Disagreements with Accountants 9
on Accounting and Financial Disclosure
Part III
9. Directors, Executive Officers, Promoters and Control 9
Persons; Compliance with Section 16(a) of the
Exchange Act
10. Executive Compensation 10
11. Security Ownership of Certain Beneficial Owners and 10
Management
12. Certain Relationships and Related Transactions 11
13. Exhibits and Reports on Form 8-K 11
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FORWARD-LOOKING STATEMENT NOTICE
When used in this report, the words "may," "will," "expect,"
"anticipate," "continue," "estimate," "project," "intend," and
similar expressions are intended to identify forward-looking
statements within the meaning of Section 27a of the Securities
Act of 1933 and Section 21e of the Securities Exchange Act of
1934 regarding events, conditions, and financial trends that may
affect the Company's future plans of operations, business
strategy, operating results, and financial position. Persons
reviewing this report are cautioned that any forward-looking
statements are not guarantees of future performance and are
subject to risks and uncertainties and that actual results may
differ materially from those included within the forward-looking
statements as a result of various factors. Such factors are
discussed under the headings "Item 1. Description of Business,"
and "Item 6. Management's Discussion and Analysis of Financial
Condition and Results of Operations," and also include general
economic factors and conditions that may directly or indirectly
impact the Company's financial condition or results of
operations.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
General
The Company is seeking a favorable business opportunity to
acquire. The Company has not entered into any agreement, nor
does it have any commitment or understanding to enter into or
become engaged in a transaction as of the date of this filing.
The Company continues to investigate, review, and evaluate
business opportunities as they become available and will seek to
acquire or become engaged in business opportunities at such time
as specific opportunities warrant. The Company cannot now
predict what type of business it may enter into or acquire. It
is emphasized that the business objectives discussed herein are
extremely general and are not intended to be restrictive on the
discretion of the Company's management.
It is anticipated that business opportunities will be
identified for the Company through its officers and directors and
through professional advisors including securities broker-dealers
and through members of the financial community. To a large
extent, a decision to participate in a specific business
opportunity may be made upon management's analysis regarding the
quality of the other firm's management and personnel, the asset
base of such firm or enterprise, the anticipated acceptability of
new products or marketing concepts, the merit of the firm's
business plan, and numerous other factors which are difficult, if
not impossible, to analyze through the application of any
objective criteria.
There are no plans or arrangements proposed or under
consideration for the issuance or sale of additional securities
by the Company prior to the identification of an acquisition
candidate. Consequently, management anticipates that it may be
able to participate in only one potential business venture, due
primarily to the Company's limited capital. This lack of
diversification should be considered a substantial risk, because
it will not permit the Company to offset potential losses from
one venture against gains from another.
Selection of a Business
The Company anticipates that businesses for possible
acquisition will be referred by various sources, including its
officers and directors, professional advisors, securities broker-
dealers, venture
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capitalists, members of the financial community, and others who
may present unsolicited proposals. The Company will not engage
in any general solicitation or advertising for a business
opportunity, and will rely on personal contacts of its officers
and directors and their affiliates, as well as indirect
associations between them and other business and professional
people. By relying on "word of mouth", the Company may be
limited in the number of potential acquisitions it can identify.
While it is not presently anticipated that the Company will
engage unaffiliated professional firms specializing in business
acquisitions or reorganizations, such firms may be retained if
management deems it in the best interest of the Company.
Compensation to a finder or business acquisition firm may
take various forms, including one-time cash payments, payments
based on a percentage of revenues or product sales volume,
payments involving issuance of securities (including those of the
Company), or any combination of these or other compensation
arrangements. Consequently, the Company is currently unable to
predict the cost of utilizing such services.
The Company will not restrict its search to any particular
business, industry, or geographical location, and management
reserves the right to evaluate and enter into any type of
business in any location. The Company may participate in a newly
organized business venture or a more established company entering
a new phase of growth or in need of additional capital to
overcome existing financial problems. Participation in a new
business venture entails greater risks since in many instances
management of such a venture will not have proved its ability,
the eventual market of such venture's product or services will
likely not be established, and the profitability of the venture
will be unproved and cannot be predicted accurately. If the
Company participates in a more established firm with existing
financial problems, it may be subjected to risk because the
financial resources of the Company may not be adequate to
eliminate or reverse the circumstances leading to such financial
problems.
In seeking a business venture, the decision of management
will not be controlled by an attempt to take advantage of any
anticipated or perceived appeal of a specific industry,
management group, product, or industry, but will be based on the
business objective of seeking long-term capital appreciation in
the real value of the Company.
The analysis of new businesses will be undertaken by or
under the supervision of the officers and directors. In
analyzing prospective businesses, management will consider, to
the extent applicable, the available technical, financial, and
managerial resources; working capital and other prospects for the
future; the nature of present and expected competition; the
quality and experience of management services which may be
available and the depth of that management; the potential for
further research, development, or exploration; the potential for
growth and expansion; the potential for profit; the perceived
public recognition or acceptance of products, services, or trade
or service marks; name identification; and other relevant
factors.
The decision to participate in a specific business may be
based on management's analysis of the quality of the other firm's
management and personnel, the anticipated acceptability of new
products or marketing concepts, the merit of technological
changes, and other factors which are difficult, if not
impossible, to analyze through any objective criteria. It is
anticipated that the results of operations of a specific firm may
not necessarily be indicative of the potential for the future
because of the requirement to substantially shift marketing
approaches, expand significantly, change product emphasis, change
or substantially augment management, and other factors.
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The Company will analyze all available factors and make a
determination based on a composite of available facts, without
reliance on any single factor. The period within which the
Company may participate in a business cannot be predicted and
will depend on circumstances beyond the Company's control,
including the availability of businesses, the time required for
the Company to complete its investigation and analysis of
prospective businesses, the time required to prepare appropriate
documents and agreements providing for the Company's
participation, and other circumstances.
Acquisition of a Business
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, or other reorganization with another corporation
or entity; joint venture; license; purchase and sale of assets;
or purchase and sale of stock, the exact nature of which cannot
now be predicted. Notwithstanding the above, the Company does
not intend to participate in a business through the purchase of
minority stock positions. On the consummation of a transaction,
it is likely that the present management and shareholders of the
Company will not be in control of the Company. In addition, a
majority or all of the Company's directors may, as part of the
terms of the acquisition transaction, resign and be replaced by
new directors without a vote of the Company's shareholders.
In connection with the Company's acquisition of a business,
the present shareholders of the Company, including officers and
directors, may, as a negotiated element of the acquisition, sell
a portion or all of the Company's Common Stock held by them at a
significant premium over their original investment in the
Company. As a result of such sales, affiliates of the entity
participating in the business reorganization with the Company
would acquire a higher percentage of equity ownership in the
Company. Management does not intend to actively negotiate for or
otherwise require the purchase of all or any portion of its stock
as a condition to or in connection with any proposed merger or
acquisition. Although the Company's present shareholders did not
acquire their shares of Common Stock with a view towards any
subsequent sale in connection with a business reorganization, it
is not unusual for affiliates of the entity participating in the
reorganization to negotiate to purchase shares held by the
present shareholders in order to reduce the amount of shares held
by persons no longer affiliated with the Company and thereby
reduce the potential adverse impact on the public market in the
Company's common stock that could result from substantial sales
of such shares after the business reorganization. Public
investors will not receive any portion of the premium that may be
paid in the foregoing circumstances. Furthermore, the Company's
shareholders may not be afforded an opportunity to approve or
consent to any particular stock buy-out transaction.
In the event sales of shares by present shareholders of the
Company, including officers and directors, is a negotiated
element of a future acquisition, a conflict of interest may arise
because directors will be negotiating for the acquisition on
behalf of the Company and for sale of their shares for their own
respective accounts. Where a business opportunity is well suited
for acquisition by the Company, but affiliates of the business
opportunity impose a condition that management sell their shares
at a price which is unacceptable to them, management may not
sacrifice their financial interest for the Company to complete
the transaction. Where the business opportunity is not well
suited, but the price offered management for their shares is
high, Management will be tempted to effect the acquisition to
realize a substantial gain on their shares in the Company.
Management has not adopted any policy for resolving the foregoing
potential conflicts, should they arise, and does not intend to
obtain an independent appraisal to determine whether any price
that may be offered for their shares is fair. Stockholders must
rely, instead, on the obligation of management to fulfill its
fiduciary duty under state law to act in the best interests of
the Company and its stockholders.
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It is anticipated that any securities issued in any such
reorganization would be issued in reliance on exemptions from
registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of the
transaction, the Company may agree to register such securities
either at the time the transaction is consummated, under certain
conditions, or at specified times thereafter. Although the terms
of such registration rights and the number of securities, if any,
which may be registered cannot be predicted, it may be expected
that registration of securities by the Company in these
circumstances would entail substantial expense to the Company.
The issuance of substantial additional securities and their
potential sale into any trading market which may develop in the
Company's securities may have a depressive effect on such market.
While the actual terms of a transaction to which the Company
may be a party cannot be predicted, it may be expected that the
parties to the business transaction will find it desirable to
structure the acquisition as a so-called "tax-free" event under
sections 351 or 368(a) of the Internal Revenue Code of 1986, (the
"Code"). In order to obtain tax-free treatment under section 351
of the Code, it would be necessary for the owners of the acquired
business to own 80% or more of the voting stock of the surviving
entity. In such event, the shareholders of the Company would
retain less than 20% of the issued and outstanding shares of the
surviving entity. Section 368(a)(1) of the Code provides for tax-
free treatment of certain business reorganizations between
corporate entities where one corporation is merged with or
acquires the securities or assets of another corporation.
Generally, the Company will be the acquiring corporation in such
a business reorganization, and the tax-free status of the
transaction will not depend on the issuance of any specific
amount of the Company's voting securities. It is not uncommon,
however, that as a negotiated element of a transaction completed
in reliance on section 368, the acquiring corporation issue
securities in such an amount that the shareholders of the
acquired corporation will hold 50% or more of the voting stock of
the surviving entity. Consequently, there is a substantial
possibility that the shareholders of the Company immediately
prior to the transaction would retain less than 50% of the issued
and outstanding shares of the surviving entity. Therefore,
regardless of the form of the business acquisition, it may be
anticipated that stockholders immediately prior to the
transaction will experience a significant reduction in their
percentage of ownership in the Company.
Notwithstanding the fact that the Company is technically the
acquiring entity in the foregoing circumstances, generally
accepted accounting principles will ordinarily require that such
transaction be accounted for as if the Company had been acquired
by the other entity owning the business and, therefore, will not
permit a write-up in the carrying value of the assets of the
other company.
The manner in which the Company participates in a business
will depend on the nature of the business, the respective needs
and desires of the Company and other parties, the management of
the business, and the relative negotiating strength of the
Company and such other management.
The Company will participate in a business only after the
negotiation and execution of appropriate written agreements.
Although the terms of such agreements cannot be predicted,
generally such agreements will require specific representations
and warranties by all of the parties thereto, will specify
certain events of default, will detail the terms of closing and
the conditions which must be satisfied by each of the parties
prior to such closing, will outline the manner of bearing costs
if the transaction is not closed, will set forth remedies on
default, and will include miscellaneous other terms.
Operation of Business After Acquisition
The Company's operation following its acquisition of a
business will be dependent on the nature of the business and the
interest acquired. The Company is unable to predict whether the
Company will
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be in control of the business or whether present management will
be in control of the Company following the acquisition. It may
be expected that the business will present various risks, which
cannot be predicted at the present time.
Governmental Regulation
It is impossible to predict the government regulation, if
any, to which the Company may be subject until it has acquired an
interest in a business. The use of assets and/or conduct of
businesses which the Company may acquire could subject it to
environmental, public health and safety, land use, trade, or
other governmental regulations and state or local taxation. In
selecting a business in which to acquire an interest, management
will endeavor to ascertain, to the extent of the limited
resources of the Company, the effects of such government
regulation on the prospective business of the Company. In
certain circumstances, however, such as the acquisition of an
interest in a new or start-up business activity, it may not be
possible to predict with any degree of accuracy the impact of
government regulation. The inability to ascertain the effect of
government regulation on a prospective business activity will
make the acquisition of an interest in such business a higher
risk.
Competition
The Company will be involved in intense competition with
other business entities, many of which will have a competitive
edge over the Company by virtue of their stronger financial
resources and prior experience in business. There is no
assurance that the Company will be successful in obtaining
suitable investments
Employees
The Company is a development stage company and currently has
no employees. The sole executive officer, who is not compensated
for his time contributed to the Company, will devote only such
time to the affairs of the Company as he deems appropriate, which
is estimated to be approximately 20 hours per month. Management
of the Company expects to use consultants, attorneys, and
accountants as necessary, and does not anticipate a need to
engage any full-time employees so long as it is seeking and
evaluating businesses. The need for employees and their
availability will be addressed in connection with a decision
whether or not to acquire or participate in a specific business
industry.
ITEM 2. DESCRIPTION OF PROPERTIES
The Company uses offices at 11900 Wayzata Blvd., Suite 100,
Hopkins, MN 55305, provided by an officer and director of the
Company at no charge.
ITEM 3. LEGAL PROCEEDINGS
The Company is not a party to any material pending legal
proceedings, and to the best of its knowledge, no such
proceedings by or against the Company have been threatened.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders in the
last quarter of the fiscal year ended September 30, 1999.
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PART III
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There is presently no established trading market for the
Company's common stock.
All shares of common stock outstanding may be sold without
restriction under Rule 144(k) promulgated under the Securities
Act of 1933, except 1,000,000 shares, which are held by the sole
officer and director of the Company. After March 5, 2000, shares
held by the sole officer and director may be sold subject to
complying with all of the terms and conditions of Rule 144.
Since its inception, no dividends have been paid on the
Company's common stock. The Company intends to retain any
earnings for use in its business activities, so it is not
expected that any dividends on the common stock will be declared
and paid in the foreseeable future.
At September 30, 1999, there were approximately 135 holders
of record of the Company's Common Stock.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION
AND RESULTS OF OPERATIONS
Results of Operations
Years Ended September 30, 1999 and 1998
The Company had no revenue for the years ended September 30,
1999 and 1998.
General and administrative expenses for year ended September
30, 1999, were $9,890, and the Company had no such expenses
during the corresponding year end in 1998. General and
administrative expenses during the year ended September 30, 1999,
consisted of fees and related expenses associated with reviving
the Company. The Company realized a net loss of $9,890 for the
fiscal year 1999, and no net income or loss for the corresponding
period in 1998.
The Company does not expect to generate any meaningful
revenue or incur operating expenses unless and until it acquires
an interest in an operating company.
Liquidity and Capital Resources
At September 30, 1999, the Company had $110 working capital.
Management believes that the Company has sufficient cash and
short-term investments to meet the anticipated needs of the
Company's operations through at least the next 12 months.
However, there can be no assurances to that effect, as the
Company has no revenues and the Company's need for capital may
change dramatically if it acquires an interest in a business
opportunity during that period. The Company's current operating
plan is to (i) handle the administrative and reporting
requirements of a public company; and (ii) search for potential
businesses, products, technologies and companies for acquisition.
At present, the Company has no understandings, commitments or
agreements with respect to the acquisition of any business,
product, technology or company and there can be no assurance that
the Company will identify any such business, product, technology
or company suitable for acquisition in the future. Further,
there can be no assurance
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that the Company would be successful in consummating any
acquisition on favorable terms or that it will be able to
profitably manage the business, product, technology or company it
acquires.
ITEM 7. FINANCIAL STATEMENTS
The financial statements of the Company appear at the end of
this report beginning with the Index to Financial Statements on
page F-1.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
On December 6, 1999, Thomas Lewis and Associates, P.A., the
Company's independent certified public accounting firm declined
to be re-appointed as the Company's auditors for the Fiscal year
ended September 30, 1999.
During the fiscal year ended September 30, 1999, and the
interim period subsequent to September 30, 1999, there have been
no disagreements with Thomas Lewis and Associates, on any matter
of accounting principles or practices, financial statement
disclosure or auditing scope or procedure or any reportable
events.
Thomas Lewis and Associates' report on the Company's
financial report as of and for the years ended September 30, 1998
and 1997 contained no adverse opinion or disclaimer of opinion
and, further, was not qualified or modified as to uncertainty,
audit scope or accounting principles.
Thomas Lewis and Associates P.A. has furnished a letter,
dated December 6, 1999, addressed to the U. S. Securities and
Exchange Commission stating that it agrees with the above
statements.
On December 6, 1999, the Company appointed the independent
certified accounting firm of S. W. Hatfield, CPA of Dallas, Texas
as the Company's auditors as of and for the year ended September
30, 1999, effective immediately.
During the fiscal years ended September 30, 1998 and 1997
and the interim period subsequent to September 30, 1999, there
have been no consultations with S. W. Hatfield, CPA, on any
matters of accounting principles to a specific transaction,
either completed or proposed, or the type of audit opinion that
might be rendered on the Company's financial statements.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Directors and Officers
The following table sets forth the names, ages, and
positions with the Company for the sole director and officer of
the Company.
Name Age Positions (1) Since
Craig Laughlin 49 President and Director 1999
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All executive officers are elected by the Board and hold
office until the next Annual Meeting of stockholders and until
their successors are elected and qualify.
The following is information on the business experience of
each director and officer.
Craig Laughlin is the founder and President of SRC Funding,
Inc., which structures venture capital financing for early stage
companies. Mr. Laughlin has been a consultant in the areas of
mergers, acquisitions, and early stage financing since 1986. Mr.
Laughlin has also served as a member of the board of directors
since May 1990, of Century Controls International, Inc., a
publicly held company engaged in the business of designing,
manufacturing, and marketing a line of proprietary control
devices used in the management of large commercial and industrial
steam boilers and of certain manufacturing processes.
ITEM 10. EXECUTIVE COMPENSATION
The Company has no agreement or understanding, express or
implied, with any officer, director, or principal stockholder, or
their affiliates or associates, regarding employment with the
Company or compensation for services. The Company has no plan,
agreement, or understanding, express or implied, with any
officer, director, or principal stockholder, or their affiliates
or associates, regarding the issuance to such persons of any
shares of the Company's authorized and unissued common stock.
There is no understanding between the Company and any of its
present stockholders regarding the sale of a portion or all of
the common stock currently held by them in connection with any
future participation by the Company in a business. There are no
other plans, understandings, or arrangements whereby any of the
Company's officers, directors, or principal stockholders, or any
of their affiliates or associates, would receive funds, stock, or
other assets in connection with the Company's participation in a
business. No advances have been made or contemplated by the
Company to any of its officers, directors, or principal
stockholders, or any of their affiliates or associates.
There is no policy that prevents management from adopting a
plan or agreement in the future that would provide for cash or
stock based compensation for services rendered to the Company.
On acquisition of a business, it is possible that current
management will resign and be replaced by persons associated with
the business acquired, particularly if the Company participates
in a business by effecting a stock exchange, merger, or
consolidation as discussed under "Item 1. Business." In the
event that any member of current management remains after
effecting a business acquisition, that member's time commitment
and compensation will likely be adjusted based on the nature and
location of such business and the services required, which cannot
now be foreseen.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth as of September 30, 1999, the
number and percentage of the outstanding shares of common stock
that were beneficially owned by (i) each person who is currently
a director of the Company, (ii) each executive officer, (iii) all
current directors and executive officers of the Company as a
group and (iv) each person who, to the knowledge of the Company,
is the beneficial owner of more than 5% of the outstanding common
stock. Craig Laughlin is the ole officer, director, and 5%
stockholder of the Company. Except as otherwise indicated, the
person named in the table has sole
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voting and dispositive power with respect to all shares
beneficially owned, subject to community property laws where
applicable.
Common Percent
Shares of
Class
Name and Address
Craig Laughlin 1,000,000 74.0
11900 Wayzata Blvd., Suite 100
Hopkins, MN 55305
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On March 6, 1999, the Company sold 1,000,000 shares of
common stock to Craig Laughlin, the sole officer and director of
the Company, for $10,000. No underwriter or broker was involved
in the offering, and no commissions were paid on the sale of the
shares. The shares were offered and sold in reliance on the
exemption set forth in Section 4(2) of the Securities Act of
1933. Except for the sale and purchase of the Company's common
stock described above there are no proposed transactions and no
transactions during the past two years to which the Company was a
party and in which any officer, director, or principal
stockholder, or their affiliates or associates, was also a party.
ITEM 13.
EXHIBITS AND REPORTS ON FORM 8-K
Copies of the following documents are included as exhibits
to this report pursuant to Item 601 of Regulation S-B.
Exhibits.
Exhibit SEC Ref. Title of Document Location
No. No.
1 (3)(i) Articles of Incorporation, as amended * Fm 10-SB
Page E-1
2 (3)(ii) By-Laws * Fm 10-SB
Page E-3
3 (16) Letter dated December 6, 1999 from Fm 8-K
Thomas Lewis and Associates, P.A. * Page E-1
3 (27) Financial Data Schedules **
* Exhibit No.'s 1 and 2 are incorporated herein by this
reference to the Company's Registration Statement on Form 10-SB
filed with the Securities and Exchange Commission on June 14,
1999. Exhibit
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No. 3 is incorporated by reference to the Company's Current
Report on Form 8-K dated December 6, 1999 and filed with the
Securities and Exchange Commission on December 9, 1999.
** The Financial Data Schedule is presented only in the
electronic filing with the Securities and Exchange Commission.
FORM 8-K FILINGS
On December 9, 1999, the Company filed with the Securities
and Exchange Commission a Current Report on Form 8-K dated
December 6, 1999, reporting under Item 4 a change in the
Company's independent auditors.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act,
the registrant caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
FUTURE TECHNOLOGIES, INC.
Date: December 21, 1999 By: /s/ Craig Laughlin, President
In accordance with the Exchange Act, this report has been
signed by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Dated: December 21, 1999 /s/ Craig Laughlin, Director
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FUTURE TECHNOLOGIES, INC.
Financial Statements
September 30, 1999 and 1998
CONTENTS
Independent Auditors' Reports F-2
Balance Sheets F-4
Statements of Operations F-5
Statement of Changes in Stockholders' Equity F-6
Statements of Cash Flows F-7
Notes to the Financial Statements F-8
F-1
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S. W. HATFIELD, CPA
certified public accountants
Member: American Institute of Certified Public Accountants
SEC Practice Section
Information Technology Section
Texas Society of Certified Public Accountants
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors and Stockholders
Future Technologies, Inc.
We have audited the accompanying balance sheet of Future
Technologies, Inc. (a Minnesota corporation ) as of September 30,
1999 and the related statements of operations and comprehensive
income, changes in stockholders' equity and cash flows for the
year then ended. 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 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 Future Technologies, Inc. as of September 30, 1999 and the
related statements of operations and its cash flows for the year
then ended, 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 A to the financial statements, the Company has no viable
operations or significant assets and is dependent upon
significant shareholders to provide sufficient working capital to
maintain the integrity of the corporate entity. These
circumstances create substantial doubt about the Company's
ability to continue as a going concern and are discussed in Note
A. The financial statements do not contain any adjustments that
might result from the outcome of these uncertainties.
S. W. HATFIELD, CPA
Dallas, Texas
December 7, 1999
Use our past to assist your future sm
P. O. Box 820395 9002 Green Oaks Circle, 2nd Floor
Dallas, Texas 75382-0395 Dallas, Texas 75243-7212
214-342-9635 (voice) (fax) 214-342-9601
800-244-639 [email protected]
F-2
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
FUTURE TECHNOLOGIES, INC.
We have audited the accompanying balance sheet of Future
Technologies, Inc. (a Minnesota corporation ) as of September 30,
1998 and the related statements of operations and comprehensive
income, changes in stockholders' equity and cash flows for the
year then ending. 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 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 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 Future Technologies, Inc. as of September 30, 1998 and the
related statements of operations and cash flows for the year then
ended, in conformity with generally accepted accounting
principles.
THOMAS LEWIS & ASSOCIATES, P.A.
Minneapolis, Minnesota
June 2, 1999
F-3
<PAGE>
FUTURE TECHNOLOGIES, INC.
BALANCE SHEETS
September 30, 1999 and 1998
ASSETS
1999 1998
Current assets
Cash on hand and in bank $ 1,010 $ -
TOTAL ASSETS $ 1,010 $ -
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable - trade $ 900 $ -
Total liabilities - -
Commitments and contingencies
Stockholders' equity
Preferred stock - $0.01 par value.
5,000,000 shares authorized.
None issued and outstanding - -
Common stock - $0.01 par value.
45,000,000 shares authorized.
1,348,089 and 348,089 shares issued
and outstanding, respectively 13,481 3,481
Additional paid-in capital 49,405 49,405
Accumulated deficit (62,776) (52,886)
Total stockholders' equity 110 -
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,010 $ -
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE>
FUTURE TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
Years ended September 30, 1999 and 1998
1999 1998
Net revenues $ - $ -
Operating expenses
General and administrative expenses 938 -
Legal and professional fees 8,952 -
Total operating expenses 9,890 -
Loss from continuing operations
before income taxes (9,890) -
Income tax benefit (expense) - -
Net Loss (9,890) -
Other comprehensive income - -
Comprehensive Income (Loss) $ (9,890) $ -
Loss per weighted-average share
of common stock outstanding,
computed on net loss - basic
and fully diluted $ (0.01) nil
Weighted-average number of
common shares outstanding -
basic and fully diluted 925,115 352,512
The accompanying notes are an integral part of these financial statements.
F-5
<PAGE>
FUTURE TECHNOLOGIES, INC.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Years ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
Additional
Common Stock paid-in Accumulated
Shares Amount capital deficit Total
<S> <C> <C> <C> <C> <C>
Balances at October 1, 1997,
as originally presented 352,512 $ 35,251 $ 17,635 $ (52,886) $ -
Correction of cumulative
clerical errors found in
Fiscal 1999 reconciliation
of shareholder's listing (4,423) (442) 442 - -
February 1999 restatement of
par value from $0.10 to $0.01 - (31,328) 31,328 - -
Balances at October 1, 1997
as restated 348,089 3,481 49,405 (52,886) -
Net loss for the year - - - - -
Balances at September 30, 1998 348,089 3,481 49,405 (52,886) -
Sale of common stock subject
to a private placement 1,000,000 10,000 - - 10,000
Net loss for the year - - - (9,890) (9,890)
Balances at September 30, 1999 1,348,089 $ 13,481 $ 49,405 $ (62,776) $ 110
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-6
<PAGE>
FUTURE TECHNOLOGIES, INC.
STATEMENTS OF CASH FLOWS
Years ended September 30, 1999 and 1998
1999 1998
Cash flows from operating activities
Net loss for the period $ (9,890) $ -
Adjustments to reconcile net loss to net
cash provided by operating activities
Increase in accounts payable - trade 900 -
Net cash used in operating activities (8,990) -
Cash flows from investing activities - -
Cash flows from financing activities
Proceeds from sale of common stock 10,000 -
Net cash provided by financing activities 10,000 -
Increase in Cash 1,010 -
Cash at beginning of period - -
Cash at end of period $ 1,010 $ -
Supplemental disclosure of interest
and income taxes paid
Interest paid for the period $ - $ -
Income taxes paid for the period $ - $ -
The accompanying notes are an integral part of these financial statements.
F-7
<PAGE>
FUTURE TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE A - ORGANIZATION AND DESCRIPTION OF BUSINESS
Future Technologies, Inc. (Company) was initially formed under
the laws of the State of Minnesota as Land Corporation of
America, Inc. on June 20, 1972 for the purpose of developing
parcels of land into mobile home parks and to sell the developed
lots to owners of mobile homes. On November 30, 1977, the
Company changed its corporate name to Future Homes, Inc. The
Company operated successfully until the late-1970's when an
economic recession caused significant difficulty in the financing
of mobile homes for purchasers. The Company began to suffer
operating losses through the early-1980's and, in 1983, closed
five (5) of its six (6) operating locations. On June 10, 1989,
the Company assigned all remaining assets to its creditors and
became inactive.
On February 8, 1999, the Company restated its Articles of
Incorporation in the State of Minnesota, increased the authorized
number of shares which may be issued in the form of both
preferred and common stock, changed its stated par value to $0.01
per share and adopted new corporate by-laws. Additionally, this
restatement changed the corporate name to Future Technologies,
Inc.
The Company successfully completed a public offering of its
common stock in 1973 whereby 160,000 shares were sold at a gross
price of $2.50 per share.
The current business purpose of the Company is to seek out and
obtain a merger, acquisition or outright sale transaction whereby
the Company's stockholders will benefit. The Company is not
engaged in any negotiations and has not undertaken any steps to
initiate the search for a merger or acquisition candidate.
With the disposition of all operations in 1989, the Company
became fully dependent upon the support of its controlling
shareholders for the maintenance of its corporate status and to
provide all working capital support for the Company's behalf.
The controlling shareholders intend to continue the funding of
necessary expenses to sustain the corporate entity.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect certain reported
amounts and disclosures. Accordingly, actual results could
differ from those estimates.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. Cash and cash equivalents
The Company considers all cash on hand and in banks,
including accounts in book overdraft positions, certificates
of deposit and other highly-liquid investments with
maturities of three months or less, when purchased, to be
cash and cash equivalents.
Cash overdraft positions may occur from time to time due to
the timing of making bank deposits and releasing checks, in
accordance with the Company's cash management policies.
F-8
<PAGE>
FUTURE TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
2. Income taxes
The Company uses the asset and liability method of accounting
for income taxes. At September 30, 1999 and 1998,
respectively, the deferred tax asset and deferred tax
liability accounts, as recorded when material to the
financial statements, are entirely the result of temporary
differences. Temporary differences represent differences in
the recognition of assets and liabilities for tax and
financial reporting purposes, primarily accumulated
depreciation and amortization, allowance for doubtful
accounts and vacation accruals.
Due to the provisions of Internal Revenue Code Section 338,
the Company will have no net operating loss carryforwards
available to offset financial statement or tax return taxable
income in future periods as a result of a change in control
involving 50 percentage points or more of the issued and
outstanding securities of the Company.
3. Earnings (loss) per share
Basic earnings (loss) per share is computed by dividing the
net income (loss) by the weighted-average number of shares of
common stock and common stock equivalents (primarily
outstanding options and warrants). Common stock equivalents
represent the dilutive effect of the assumed exercise of the
outstanding stock options and warrants, using the treasury
stock method. The calculation of fully diluted earnings
(loss) per share assumes the dilutive effect of the exercise
of outstanding options and warrants at either the beginning
of the respective period presented or the date of issuance,
whichever is later. As of September 30, 1999 and 1998, the
Company has no outstanding warrants and options issued and
outstanding.
NOTE C - COMMON STOCK TRANSACTIONS
On March 5, 1999, the Company issued approximately 1,000,000
shares of restricted, unregistered common stock, pursuant to a
private placement letter to its President for proceeds of $10,000
cash. The proceeds were designated by the Company's Board of
Directors "to pay for legal, accounting and other expenses
associated with the Company's plan to position itself to make an
acquisition of an existing business opportunity".
F-9
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,010
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,010
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,010
<CURRENT-LIABILITIES> 900
<BONDS> 0
0
0
<COMMON> 13,481
<OTHER-SE> (13,371)
<TOTAL-LIABILITY-AND-EQUITY> 1,010
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 9,890
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (9,890)
<INCOME-TAX> 0
<INCOME-CONTINUING> (8,890)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (9,890)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
