SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-KSB
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the year ended December 31, 1999Commission File No. 000-26953
BACH-HAUSER, INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0390697
(State of organization) (I.R.S. Employer Identification No.)
2080 E. Flamingo Rd., Suite 112, Las Vegas, NV 89119
(Address of principal executive offices)
Registrant's telephone number, including area code (702) 650-5660
Securities registered under Section 12(g) of the Exchange Act:
Common stock, $0.001 par value per share
Check whether the issuer (1) filed all reports required to be
file by Section 13 or 15(d) of the Exchange Act during the past
12 months and (2) has been subject to such filing requirements
for the past 90 days. No X
Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B not contained in this form, and no
disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any
amendments to this Form 10-KSB. [ X ]
Issuer's Revenue during the year ended December 31, 1999: $ 0
As of December 31, 1999, the registrant had 19,500,000 shares of
its common stock, $0.001 par value, outstanding. Aggregate market
value of the voting and non-voting common equity held by non-
affiliates based on the price of N/A per share (the selling or
average bid and asked price) as of December 31, 1999: $3,705,000.
DOCUMENTS INCORPORATED BY REFERENCE:
The Company's amended Form 10-SB/A, filed on August 13, 1999, and
the exhibits attached thereto, are incorporated by reference.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
Background
Bach-Hauser, Inc. (the "Company") is a Nevada corporation formed
on October 10, 1995. Its principal place of business is located
at 2080 E. Flamingo Rd., Suite 112, Las Vegas, NV 89119. The
Company was organized to engage in any lawful corporate business,
including but not limited to, participating in mergers with and
acquisitions of other companies. The Company has been in the
developmental stage since inception and has no operating history
other than organizational matters.
On October 16, 1995, the Company issued 6,000,000 shares of its
Common Stock, at a price of $0.001 per share, to its three
founders. The initial founders gifted some of their shares to a
total of 5 persons, who then gifted some of their shares to a
total of 23 additional persons. All of these transfers were
issued in accordance with the exemption from registration
requirements of Section 5 of the Securities Exchange Act of 1934,
as amended, as provided in Section 4 of the Act.
On April 29, 1999, the Company approved reorganizing the capital
structure by forward splitting the outstanding shares of the
corporation on a 2.5:1. The forward split had a net result of
7,500,000 shares held by non-officers and 7,500,000 restricted
shares held by officers for a total of 15,000,000 issued and
outstanding shares.
Originally the Company's primary focus was to seek a viable
company or companies with whom it could merge or acquire. On
September 3, 1999, the Company announced that it had entered into
a licensing agreement with TCR Environmental Corp, a corporation
incorporated under the laws of the Province of Ontario, Canada.
TCR is engaged in the design, construction, the equipping and
operation of waste management facilities for the recycling,
composting and disposing of municipal and institutional solid
waste, and the sale or other disposition of the resultant compost
and recycled products. TCR currently operates a waste-processing
facility in the Town of Aylmer, in the Province of Ontario,
Canada, which will serve as a model for the turn-key waste-
processing facility proposed by TCR to be manufactured and
marketed throughout the world.
Under the terms of the agreement, the Company was granted the
exclusive license to distribute, use and sell the products
throughout the world, with the exception of Canada, and to use
the information and knowledge of TCR in conjunction with the
products. The agreement also grants the Company the exclusive
rights to use and exploit the information and knowledge in the
distribution of the products. The agreement is to remain in full
force and effect for a period of 25 years, with an option to
extend the term for a period of 25 years. As consideration for
the license, the Company issued 4,500,000 shares of its common
stock to TCR.
The Board of Directors has elected to begin implementing the
Company's principal business purpose, described below under "Item
6, Plan of Operation". The Company is still in its development
stage and has not generated any revenues.
ITEM 2. DESCRIPTION OF PROPERTY.
The Company neither owns nor leases any real property at this
time. The Company does have the use of a limited amount of office
space from its Resident Agent, at no cost to the Company, and
Management expects this arrangement to continue. The Company pays
its own charges for long distance telephone calls and other
miscellaneous secretarial, photocopying, and similar expenses.
This is a verbal agreement between the Resident Agent and the
Board of Directors.
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 action by
or against the Company has been threatened.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No such matters were submitted during the most recent quarter.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.
Market Price
The Company's common stock is quoted on the over-the-counter
market in the United States under the symbol BHAS. The quotations
reflect inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions.
Qtr. Ended Low/Bid High/Ask
June 30, 1999 6.25 6.25
September 30, 5.50 7.00
1999
December 31, 0.19 0.37
1999
Source: America Online.
The Company's common stock is considered a "penny stock" under
the Commission rules.
Effective August 11, 1993, the Securities and Exchange Commission
adopted Rule 15g-9, which established the definition of a "penny
stock," for purposes relevant to the Company, as any equity
security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to
certain exceptions. For any transaction involving a penny stock,
unless exempt, the rules require: (i) that a broker or dealer
approve a person's account for transactions in penny stocks; and
(ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve
a person's account for transactions in penny stocks, the broker
or dealer must (i) obtain financial information and investment
experience and objectives of the person; and (ii) make a
reasonable determination that the transactions in penny stocks
are suitable for that person and that person has sufficient
knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks. The broker
or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prepared by the Commission relating
to the penny stock market, which, in highlight form, (i) sets
forth the basis on which the broker or dealer made the
suitability determination; and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to
the transaction. Disclosure also has to be made about the risks
of investing in penny stocks in both public offerings and in
secondary trading, and about commissions payable to both the
broker-dealer and the registered representative, current
quotations for the securities and the rights and remedies
available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in
the account and information on the limited market in penny
stocks.
The National Association of Securities Dealers, Inc. (the
"NASD"), which administers NASDAQ, has recently made changes in
the criteria for initial listing on the NASDAQ Small Cap market
and for continued listing. For initial listing, a company must
have net tangible assets of $4 million, market capitalization of
$50 million or net income of $750,000 in the most recently
completed fiscal year or in two of the last three fiscal years.
For initial listing, the common stock must also have a minimum
bid price of $4 per share. In order to continue to be included on
NASDAQ, a company must maintain $2,000,000 in net tangible assets
and a $1,000,000 market value of its publicly-traded securities.
In addition, continued inclusion requires two market-makers and a
minimum bid price of $1.00 per share.
Management intends to strongly consider undertaking a transaction
with any merger or acquisition candidate which will allow the
Company's securities to be traded without the aforesaid
limitations. However, there can be no assurances that, upon a
successful merger or acquisition, the Company will qualify its
securities for listing on NASDAQ or some other national exchange,
or be able to maintain the maintenance criteria necessary to
insure continued listing. The failure of the Company to qualify
its securities or to meet the relevant maintenance criteria after
such qualification in the future may result in the discontinuance
of the inclusion of the Company's securities on a national
exchange. In such events, trading, if any, in the Company's
securities may then continue in the non-NASDAQ over-the-counter
market. As a result, a shareholder may find it more difficult to
dispose of, or to obtain accurate quotations as to the market
value of, the Company's securities.
Holders
There are 20 holders of the Company's Common Stock. On October
16, 1995, the Company issued 6,000,000 of its $0.001 par value
Common Stock for $6,000 in cash. On April 29, 1999, the stock
underwent a 2.5:1 forward stock split, resulting in a total of
15,000,000 shares issued and outstanding. All of the issued and
outstanding shares of the Company's Common Stock were issued in
accordance with the exemption from registration afforded by
Section 4(2) of the Securities Act of 1933.
Dividends
The Registrant has not paid any dividends to date, and has no
plans to do so in the immediate future.
Recent Sales of Unregistered Securities.
With respect to the issuances and transfers made, the Registrant
relied on Section 4(2) of the Securities Act of 1933, as amended.
No advertising or general solicitation was employed in offering
the shares. The securities were offered for investment only and
not for the purpose of resale or distribution, and the transfer
thereof was appropriately restricted.
During August 1999, the Company issued 4,500,000 shares of its
common stock pursuant to the terms of the licensing agreement
with TCR Environmental Corp. valued at $0.001 per share. This
issuance was exempt from registration pursuant to Section 4(2) of
the Securities Act of 1933, as amended.
In general, under Rule 144 adopted pursuant to the Securities Act
of 1933, a person (or persons whose shares are aggregated) who
has satisfied a one year holding period, under certain
circumstances, may sell within any three-month period a number of
shares which does not exceed the greater of one percent of the
then outstanding Common Stock or the average weekly trading
volume during the four calendar weeks prior to such sale. Rule
144 also permits, under certain circumstances, the sale of shares
without any quantity limitation by a person who has satisfied a
two-year holding period and who is not, and has not been for the
preceding three months, an affiliate of the Company.
ITEM 6. MANAGEMENT'S PLAN OF OPERATION
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and
"forward-looking statements" as that term is defined in Section
27A of the Securities Act of 1933 as amended (the "Securities
Act"), and Section 21E of the Securities Exchange Act of 1934 as
amended (the "Exchange Act"). All statements that are included in
this filing, other than statements of historical fact, are
forward-looking statements. Although Management believes that
the expectations reflected in these forward-looking statements
are reasonable, it can give no assurance that such expectations
will prove to have been correct. Important factors that could
cause actual results to differ materially from the expectations
are disclosed in this Statement, including, without limitation,
in conjunction with those forward-looking statements contained in
this Statement.
Plan of Operation
The Company's plan of operation is to provide customers with the
highest quality service to meet their specific needs for the cost-
effective processing, recycling and disposal of municipal,
industrial, commercial and institutional solid waste and to meet
landfill reduction goals.
Through the licensing agreement, the Company, through the TCR
Total Recycling System, is able to offer municipalities and
counties with a population of 100,000 or more an affordable
environmental solution to waste disposal, including a waste
management plant which incorporates the collection and processing
of waste into three streams:
1. recyclables
2. organic compostables
3. residuals (for landfill or waste-to-energy recovery)
The TCR Total Recycling System is a two-bag system. It differs
from conventional waste management and recycling methods in that
the custom-built recovery facility receives mixed loads of
municipal, commercial and industrial sold waste contained in both
Blue and Black Bags. The use of a two-bag system provides a
simple, efficient and cost-effective solution to waste
management. Blue Bags (recyclable items) allow easy
identification and total recovery of assets, while the opening
and sorting of Black Bag contents (balance of the waste stream)
ensures total recovery of recyclable items which would otherwise
be lost to landfill.
Municipal waste is received in the materials recovery facility
and is separated into two processing categories - recyclables and
household waste. Blue Bag contents (recyclables) are sorted and
conveyed to a baler further processing, then internally brokered
to end users. Black Bag contents (wet waste) are sorted to
recover any recyclable material and processed to remove non-
compostable contaminants.
Any organic material retrieved from sorting Black Bag contents is
conveyed to a low speed, high torque shredder. The organic
material, cut to optimize size for composting, is then conveyed
to a high speed composting unit. Computerized control and
monitoring of the compost, by a computer-controlled robot which
turns and irrigates the material, ensures specific conditions are
maintained throughout the 28-day composting process. The Company
monitors moisture content, temperature, pH, oxygen, and carbon to
nitrogen ratios to ensure optimum conditions for anaerobic
decomposition and the elimination of human/plant pathogens.
Water that comes into contact with any stage of the compost
process (ie. Storm water from curing pad) is kept onsite to
eliminate impacts, stored in a retention pond, and used back in
the process to ensure optimum moisture levels. Odor control is
maintained through the use of enzymatic mist, hygiene, and an
award winning bio-filter system. The stabilized compost is then
tested and stockpiled before being shipped to end users. The end
result is high quality compost which can be supplied to customers
at a very attractive price.
Management believes that the TCR Total Recycling System
dramatically increases the amount of recyclable material
recovered while eliminating the need for different collection
trucks, specialized equipment and Blue Boxes. With its potential
for an 80% diversion away from landfill, the Company's
alternative to the costly and ineffective Blue Box program
reduces long-term maintenance costs for existing landfill sites.
In conventional systems, many recyclable items and organic
compostables are lost when the traditional Black Bag goes
directly to landfill. The TCR Total Recycling System ensures
improperly disposed items are recovered.
Current Trends
Current trends show that stakeholder roles and responsibilities
are changing. As government budgets continue to be down-sized,
industry is increasingly being expected to contribute solutions
through stewardship initiatives. While corporations are re-
assessing their waste production and disposal attitudes, they are
looking for opportunities to divert waste away from landfill and
towards more responsible alternatives. In addition, there is a
more informed, concerned and involved public which is also
playing a key role in the evolution of the waste management
industry.
The most obvious reasons for recycling are the environmental
benefits. Using recycled rather than virgin materials uses less
energy, emits less pollution and reduces the use of non-renewable
resources. Producing compost reduces pollution and provides a
capable soil amendment. Land uses have made soil susceptible to
processes that diminish its organic content.
A soil's organic content is essential for retaining moisture,
aiding water infiltration, retaining carbon, nutrient storage and
supply, cation exchange, and structural stability to combat
erosion and compaction. Compost from municipal waste has shown to
be a capable amendment. Furthermore, compost used on agricultural
land has shown to improve crop resistance to disease.
The demand for compost is high, with markets existing in
agriculture (mixed into the soil or as a mulch on farms, as a
peat substitute in greenhouses), nurseries, landscaping, land
reclamation, golf courses, and the gardening industry. A survey
conducted by the Composting Council in Canada showed that 70% of
respondents either agreed or strongly agreed that compost made
from municipal waste is an acceptable product.
The alternatives to landfill, recycling, and composting, is
incineration. With incineration, the left-over residue material
is classified as hazardous waste and must itself be dumped. At
the same time there is increasing public opposition to air
pollution associated with incineration. However recent
innovations have shown that with high enough temperatures and
improved scrubbing, incineration is potentially viable.
Another noticeable trend involves transportation issues. The
design of the next generation of waste collection vehicles and
systems is being studied carefully. The ability to use on vehicle
to collect more than one stream of waste materials simultaneously
(i.e., one truck to collect recyclables, organics and garbage) is
very attractive and represents considerable savings in fuel,
maintenance and other related costs. There are, of course,
additional environmental benefits associated with reduce fuel
consumption and lower levels of air pollution. Management
believes that the TCR Total Recycling System provides
municipalities with a foolproof method of meeting government
mandates for diverting from landfill by 50%, while converting
recyclable solid waste into marketable commodities. Management
believes that the system provides a solution to the environmental
problems that befall the traditional methods of waste disposal.
Competition
Most competitors either operate a blue box MRF and a centralized
compost facility or a wet-dry facility. Those that operate a blue
box MRF and centralized compost facility do not have the ability
to sort mixed waste. Those companies that operate a wet-dry
facility have demonstrated comparable processing volumes with
lesser diversion percentages, and cost taxpayers millions. As
most competitors have not constructed and/or operated facilities
that allow for a totally integrated system, management believes
the Company is left with a sales and marketing advantage.
Year 2000 Compliance
The Company is aware of the issues associated with the
programming code in existing computer systems as the year 2000
approaches. The Company has assessed these issues as they relate
to the Company, and since the Company currently has no operating
business and does not use any computers, and since it has no
customers, suppliers or other constituents, it does not believe
that there are any material year 2000 issues to disclose in this
Form 10-KSB.
Regulation and Taxation
The Investment Company Act of 1940 classifies as an "investment
company" an issuer which (a) is or holds itself out as being
engaged primarily in the business of investing, reinvesting or
trading securities, or (b) is engaged or proposes to engage in
the business of investing, reinvesting, owning, holding, or
trading in securities, and owns or proposes to acquire investment
securities having a value exceeding 40 percent of the value of
its total assets. While the Company does not intend to engage in
such activities, the Company may obtain and hold a minority
interest in a number of development stage enterprises. The
Company could be expected to incur significant registration and
compliance costs if required to register under the Investment
Company Act of 1940. Accordingly, management will continue to
review the Company's activities from time to time with a view
toward reducing the likelihood the Company could be classified as
an "investment company".
The Company intends to structure a merger or acquisition in such
manner as to minimize Federal and state tax consequences to the
Company and to any target company.
Employees
The Company's only employees at the present time are its officers
and directors, who will devote as much time as the Board of
Directors determine is necessary to carry out the affairs of the
Company. (See "Item 9").
Subsequent Events
On April 24, 2000, the Company approved reorganizing the capital
structure by forward splitting the outstanding shares of the
corporation on a 2:1 basis. The forward split had a net result of
39,000,000 shares issued and outstanding.
On May 1, 2000 and May 10, 2000, the Board of Directors adopted
resolutions to issue 400,000 shares of common stock as partial
payments for legal services rendered to the Company. The stock
was issued pursuant to the filing of Forms S-8 with the
Securities and Exchange Commission.
ITEM 7. FINANCIAL STATEMENTS.
The financial statements and supplemental data required by this
Item 7 follow the index of financial statements appearing at Item
13 of this Form 10-SB.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
1. i. The Company's principal accountant was
dismissed on January 26, 2000
ii. The principal accountant's report on the financial
statements for the past two years was modified as to uncertainty
that the Company will continue as a going concern.
iii. The decision to change accountants was approved by the board
of directors.
iv. A. There were no disagreements with the former
accountant on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure,
which, if not resolved to the former accountants satisfaction,
would have caused it to make reference to the subject matter of
the disagreement(s) in connection with its report.
2. A new accountant has been engaged as the principal
accountant to audit the issuer's financial statements. The new
accountant is Merdinger, Fruchter, Rosen & Corso, P.C. and was
engaged as of June 10, 2000. Neither the Company nor anyone
acting on its behalf consulted the new accountant regarding:
ii. the application of accounting principles to a specific
completed or contemplated transaction, or the type of audit
opinion that might be rendered on the small business issuer's
financial statements, as part of the process of deciding as to
the accounting, auditing or financial reporting issue, or
iii. any matter that was the subject of a disagreement or event
identified in response to paragraph 1(iv) of this Item.
3. The Company has provided the former accountant with a copy
of the disclosures it is making in response to this Item. The
Company has requested the former accountant to furnish a letter
addressed to the Commission stating that it agrees with the
statements made by the Company. The Company has filed the letter
as an exhibit to the registration statement containing this
disclosure.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS
DIRECTORS AND EXECUTIVE OFFICERS.
The members of the Board of Directors of the Company serve until
the next annual meeting of the stockholders, or until their
successors have been elected. The officers serve at the pleasure
of the Board of Directors.
There are no agreements for any officer or director to resign at
the request of any other person, and none of the officers or
directors named below are acting on behalf of, or at the
direction of, any other person.
The Company's officers and directors will devote their time to
the business on an "as-needed" basis, which is expected to
require 5-10 hours per month.
Information as to the directors and executive officers of the
Company is as follows:
Name/Address Age Position
Peter L. Preston 65 President/Director
1561 #3 Hwy
Cayuga, Ontario Canada
N0A 1E0
Fern Hill 48 Secretary/Treasurer/Director
1 Willow Dr. Aylmer
West
Aylmer, Ontario Canada
N5H 3A8
Peter L. Preston; President
Since December 1999, Mr. Preston has been President and Chairman
of the Board for the Company.
Mr. Preston has been involved in sales training, administration
and executive decision making. He was very successful in the
field of insurance sales and administration. Mr. Preston was
successful in the Provincial election of 1995 and was elected as
the representative for one of the largest ridings in Ontario.
Many pieces of legislation introduced, or worked on by Mr.
Preston have been or are about to become law. Mr. Preston left
the political field to become more involved with the environment.
Mr. Preston was introduced to the Total Recycling System while
serving the people of Ontario and recognized it for what it was,
a way to deal with household waste other than putting it into the
ground to foul the earth. His love for the outdoors has induced
him to apply all his efforts to doing what he can to save the
earth for future generations.
From 1989 to 1995, Mr. Preston was President of Peter Preston and
Associates, an insurance brokerage firm.
From June 1995 to June 1999, Mr. Preston was a Member of
Provincial Parliament, Province of Ontario.
From June 1999 to September 1999, Mr. Preston was chairman of the
board of an innovative, waste recycling company in Canada.
Fern Hill; Secretary/Treasurer
Since December 1999, Ms. Hill has been the secretary/treasurer of
the Company.
From June 1997 to August 1999, Ms. Hill was employed as an office
manager for Environmental Corp., where she ran all aspects of the
office, developed company procedure manuals, set recording
standard for daily tonnage and material processing. She also
maintained all record keeping including human resources,
bookkeeping, various government requirements and compliance.
Form January 1997 to June 1997, Ms. Hill was employed at Honda
Canada as an administrator at the Customer Response Center. There
she served as the liaison to the President for customer
relations, handling customer inquiries and preparing
correspondence for the department manager.
From January 1996 to December 1996, Ms. Hill was employed at Eli
Lilly Canada, Inc. as an administrator in Customer Care, where
she scheduled appointments and itineraries, organizing meetings
for the Customer Care Manager. She also prepared correspondence
and presentations for the Sales & Marketing Department. She was
the bilingual administrator reporting to the Senior Medical
Information Associate, liaising with medical professionals and
the general public to address their inquiries. She prepared
documents for the Medical Reference Library and facilitated in a
new product launch for the Diabetes Care Team.
From 1994 to 1996, Ms. Hill was employed as an office
administrator at DBS Satellite Inc., where she was responsible
for all aspects of the general office administration as well as
reception, accounting procedures, customer service and
correspondence.
From 1990 to 1993, Ms. Hill was a manager at Regency Business
Centres, where she supervised the daily office services provided
to 20 companies leasing office space in the business center. She
reported directly to the CEO and President. She was also
responsible for presenting the facilities to prospective tenants
and negotiating leases.
ITEM 10. EXECUTIVE COMPENSATION
None of the Company's officers and/or directors receive any
compensation for their respective services rendered to the
Company, nor have they received such compensation in the past.
They both have agreed to act without compensation until
authorized by the Board of Directors, which is not expected to
occur until the Registrant has generated revenues from operations
after consummation of a merger or acquisition. As of the date of
this registration statement, the Company has no funds available
to pay directors. Further, none of the directors are accruing any
compensation pursuant to any agreement with the Company.
It is anticipated that Management will be compensated with stock
options and/or salary, if a business combination is completed.
The details of the stock options and/or salary have not yet been
completed. It is expected that these details will be one of the
items to be negotiated as part of the combination.
It is possible that, after the Company successfully consummates a
merger or acquisition with an unaffiliated entity, that entity
may desire to employ or retain one or more members of the
Company's management for the purposes of providing services to
the surviving entity, or otherwise provide other compensation to
such persons. However, the Company has adopted a policy whereby
the offer of any post-transaction remuneration to members of
management will not be a consideration in the Company's decision
to undertake any proposed transaction. Each member of management
has agreed to disclose to the Company's Board of Directors any
discussions concerning possible compensation to be paid to them
by any entity which proposes to undertake a transaction with the
Company and further, to abstain from voting on such transaction.
Therefore, as a practical matter, if each member of the Company's
Board of Directors is offered compensation in any form from any
prospective merger or acquisition candidate, the proposed
transaction will not be approved by the Company's Board of
Directors but will be submitted to a vote of the shareholders as
a result of the inability of the Board to affirmatively approve
such a transaction.
It is possible that persons associated with management may refer
a prospective merger or acquisition candidate to the Company. In
the event the Company consummates a transaction with any entity
referred by associates of management, it is possible that such an
associate will be compensated for their referral in the form of a
finder's fee. It is anticipated that this fee will be either in
the form of restricted common stock issued by the Company as part
of the terms of the proposed transaction, or will be in the form
of cash consideration. However, if such compensation is in the
form of cash, such payment will be tendered by the acquisition or
merger candidate, because the Company has insufficient cash
available. The amount of such finder's fee cannot be determined
as of the date of this registration statement, but is expected to
be comparable to consideration normally paid in like
transactions. No member of management of the Company will receive
any finders fee, either directly or indirectly, as a result of
their respective efforts to implement the Company's business plan
outlined herein. Persons "associated" with management is meant to
refer to persons with whom management may have had other business
dealings, but who are not affiliated with or relatives of
management.
No retirement, pension, profit sharing, stock option or insurance
programs or other similar programs have been adopted by the
Registrant for the benefit of its employees.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The following table sets forth each person known to the Company,
as of June 19, 2000, to be a beneficial owner of five percent
(5%) or more of the Company's common stock, by the Company's
directors individually, and by all of the Company's directors and
executive officers as a group. Except as noted, each person has
sole voting and investment power with respect to the shares
shown. (Note: Theses are post-split shares as of April 24, 2000)
Title of Name/Address Shares Percentage
Class of Owner Beneficially Ownership
Owned
Common David Christensen 5,000,000 12.69%
7900 Four Seasons Drive
Las Vegas, NV 89129
Common Bobby Combs 5,000,000 12.69%
6669 Five Pennies
Circle
Las Vegas, NV 89129
Common TCR Environmental Corp. 9,000,000 19.04%
25 Toronto Street,
Suite 300
Toronto, Ontario,
Canada
M5C 2R1
Common Total Ownership over 5% 7,500,000 19.04%
and Officers and
Directors
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Board of Directors has passed a resolution which contains a
policy that the Company will not seek an acquisition or merger
with any entity in which any of the Company's Officers,
Directors, principal shareholders or their affiliates or
associates serve as officer or director or hold any ownership
interest. Management is not aware of any circumstances under
which this policy may be changed through their own initiative.
The proposed business activities described herein classify the
Company as a "blank check" company. Many states have enacted
statutes, rules and regulations limiting the sale of securities
of "blank check" companies in their respective jurisdictions.
ITEM 13. FINANCIAL STATEMENTS AND EXHIBITS.
FINANCIAL STATEMENTS
Report of Independent Auditor, Merdinger, Fruchter,
Rosen, Corso, P.C., dated June 12, 2000
Balance Sheet as of December 31, 1999.
Statement of Operation for the year ended December 31,
1999.
Statement of Stockholders' Equity for the year ended
December 31, 1999.
Statement of Cash Flows for the year ended December 31,
1999.
Notes to Financial Statements
INDEPENDENT AUDITORS' REPORT
TO THE BOARD OF DIRECTORS OF BACH-HAUSER, INC.:
We have audited the accompanying balance sheet of Bach-Hauser,
Inc. (A Development Stage Company) as of December 31, 1999 and
the related statements of operations, stockholder's equity
(deficiency) and cash flows for the year then ended, and for
the period from October 10, 1995 (inception) to December 31,
1999. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used
and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our 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 Bach-Hauser, Inc. as of December 31, 1999 and the
results of its operations and its cash flows for the years then
ended, and for the period from October 10, 1995 (inception) to
December 31, 1999 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern. As
discussed in Note 1 of the accompanying financial statements,
the Company has no established source of revenue, which raises
substantial doubt about its ability to continue as a going
concern. Management's plan in regard to these matters is also
discussed in Note 1. These financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
The December 31, 1998 financial statements of Bach-Hauser, Inc.
were audited by other accountants whose report was dated July
2, 1999.
MERDINGER, FRUCHTER ROSEN & CORSO,
P.C.
Certified Public Accountants
New York, New York
June 21, 2000
BACH-HAUSER, INC.
(A Development Stage Company)
BALANCE SHEETS
<TABLE>
<S> <C> <C>
December 31,
-------------------------
1999 1998
----------- -----------
ASSETS
OTHER ASSETS
Intangible Assets $ 4,500 $ -
----------- ----------
TOTAL ASSETS $ 4,500 $ -
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES - officers advances $ 1,075 $ 1,075
----------- ----------
STOCKHOLDERS' EQUITY (DEFICIENCY):
Common stock, $.001 par value;
50,000,000 shares authorized;
shares issued and outstanding at
December 31, 1998 - 30,000,000 shares - 6,000
December 31, 1999 - 39,000,000 shares 10,500 -
Deficit accumulated during the development stage (7,075) (7,075)
----------- ----------
TOTAL STOCKHOLDERS' EQUITY (DEFICIENCY) 3,425 (1,075)
----------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIENCY) $ 4,500 $ -
=========== ==========
</TABLE>
The accompanying notes are an integral part of the financial
statements
-2-
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
<TABLE>
<S> <C> <C> <C>
For the
Period from
October 10,
1995
For the Year Ended (inception)
December 31, to
--------------------------- December 31,
1999 1998 1999
------------ ------------ -----------
REVENUE $ - $ - $ -
GENERAL, SELLING AND ADMINISTRATIVE - 1,075 (7,075)
EXPENSES
----------- ------------ -----------
LOSS BEFORE TAXES - (1,075) (7,075)
PROVISION FOR INCOME TAXES - - -
----------- ------------ -----------
NET LOSS $ - $ (1,075) $ (7,075)
=========== ============ ===========
NET LOSS PER COMMON SHARE - basic and $ (.00) $ (.00) $ (.00)
diluted
=========== ============ ===========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - basic and diluted 36,000,000 30,000,000 31,411,765
=========== ============ ===========
</TABLE>
The accompanying notes are an integral part of the financial
statements.
-3-
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY)
<TABLE>
<S> <C> <C> <C> <C>
Deficit
Accumulated
Common Stock During
-------------------------- Development
Shares Amount Stage Total
------------ ------------ ------------ ---------
Balance at January 1,
1998 30,000,000 $ 6,000 $ (6,000) $ -
Net income (loss) - - (1,075) (1,075)
----------- ------------ ------------- -----------
Balance at December 31,
1998 30,000,000 6,000 (7,075) (1,075)
Stock issued for
intangibles 9,000,000 4,500 - 4,500
Net income (loss) - - - -
----------- ------------ ------------- -----------
Balance at December 31,
1999 39,000,000 $ 10,500 $ (7,075) $ 3,425
=========== ============ ============= ===========
</TABLE>
The accompanying notes are an integral part of the financial
statements.
-4-
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
<TABLE>
<S> <C> <C> <C>
For the
Period from
October 10,
1995
For the Year ended (inception)
December 31, to
-------------------------- December 31,
1999 1998 1999
------------- ----------- -----------
CASH FLOW FROM OPERATING ACTIVITIES:
Net Loss $ - $ (1,075) $ (7,075)
Changes in Assets and Liabilities
Increase in advances payable - 1,075 1,075
------------ ----------- ----------
Net Cash (Used in) Operating - - (6,000)
Activities
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
Issuance of common stock for cash - - 6,000
------------ ----------- ----------
NET CHANGE IN CASH AND CASH EQUIVALENTS - - -
CASH AND CASH EQUIVALENTS
- beginning of period - - -
------------ ----------- ----------
CASH AND CASH EQUIVALENTS
- end of period $ - $ - $ -
=========== =========== ==========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the year -
Interest paid $ - $ - $ -
=========== =========== ==========
Income taxes paid $ - $ - $ -
=========== =========== ==========
</TABLE>
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCIAL ACTIVITIES:
During the year ended December 31, 1999:
Common stock totaling 4,500,000 shares were issued to
acquire the worldwide rights to TCR Environmental Corp.'s
proprietary waste management /conversion system.
The accompanying notes are an integral part of the financial
statements.
-5-
BACH-HAUSER, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND DECEMBER 31, 1998
NOTE 1 - DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING
POLICIES
Nature of Operations
Bach-Hauser, Inc.
("Company") is currently a development stage company
under the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 7. The Company
was incorporated under the laws of the State of
Nevada on October 10, 1995.
Basis of Presentation
The accompanying financial statements have be
en prepared in conformity with generally accepted
accounting principles, which contemplate
continuation of the Company as a going concern.
However, the Company has no established source of
revenue. This factor raises substantial doubt about
the Company's ability to continue as a going
concern. Without realization of additional capital,
it would be unlikely for the Company to continue as
a going concern. The financial statements do not
include any adjustments relating to the
recoverability and classification of recorded asset
amounts, or amounts and classification of
liabilities that might be necessary should the
Company be unable to continue in existence.
Use of Estimates
The preparation of financial statements in co
nformity with generally accepted accounting
principles requires management to make estimates and
assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial
statements and the reported amounts of revenue and
expenses during the reporting period. Actual
results could differ from those estimates.
Intangible Assets
Organization costs are recorded at cost.
Amortization is computed using the straight-line
method over five years.
Cash and Cash Equivalents
The Company considers all highly liquid inves
tments purchased with original maturities of three
months or less to be cash equivalents.
Concentration of Credit Risk
From time to time the Company places its cash
in what it believes to be credit-worthy financial
institutions. However, cash balances exceed FDIC
insured levels at various times during the year.
Organization Costs
In accordance with American Institutes of Cer
tified Public Accountants' Statement of Position 98-
5 `Reporting on the Costs of Start-Up Activities',
the Company expenses, as incurred, costs related to
organizational and start-up activities.
- 6 -
BACH-HAUSER, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND DECEMBER 31, 1998
NOTE 1 - DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING
POLICIES (Continued)
Income Taxes
Income taxes are provided for based on the li
ability method of accounting pursuant to SFAS No.
109, "Accounting for Income Taxes". Deferred income
taxes, if any, are recorded to reflect the tax
consequences on future years of differences between
the tax bases of assets and liabilities and their
financial reporting amounts at each year-end.
Long-Lived Assets
Long-lived assets and certain identifiable in
tangibles to be held and used are reviewed for
impairment whenever events or changes in
circumstances indicate that the related carrying
amount may not be recoverable. When required,
impairment losses on assets to be held and used are
recognized based on the fair value of the assets and
long-lived assets to be disposed of are reported at
the lower carrying amount or fair value less cost to
sell.
Loss Per Share
During 1998, the Company adopted SFAS No. 128,
"Earnings Per Share," which requires presentation of
basic loss per share ("Basic LPS") and diluted loss
per share ("Diluted LPS"). The computation of Basic
LPS is computed by dividing loss available to common
stockholders by the weighted average number of
outstanding common shares during the period.
Diluted LPS gives effect to all diluted potential
common shares outstanding during the period. The
computation of Diluted LPS does not assume
conversion, exercise or contingent exercise of
securities that would have an antidilutive effect on
earnings.
On April 24, 2000, the Company effected a 2 f
or 1 stock split. All share and per share amounts
presented in the financial statements give
retroactive effect to this stock split.
Comprehensive Income
In June 1998, the FASB issued Statement of Financial
Accounting Standards No. 130, "Reporting
Comprehensive Income". SFAS No. 130 establishes
standards for the reporting and display of
comprehensive income and its components in the
financial statements. As of December 31, 1999 and
1998, and for the period from October 10, 1995
(inception) to December 31, 1999, the Company has no
items that represent comprehensive income and,
therefore, has not included a schedule of
comprehensive income in the accompanying financial
statements.
Impact of Year 2000 Issue
As of December 31, 1999, the Company does not have
any computer systems or customers and suppliers.
Therefore, the issue of the year 2000 has no effect
on the Company's current activities.
- 7 -
BACH-HAUSER, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND DECEMBER 31, 1998
NOTE 2 - RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or
personal property. A director provides office
services without charge. Such costs are immaterial
to the financial statements and, accordingly, have
not been reflected therein. The officers and
directors of the Company are involved in other
business activities and may, in the future, become
involved in other business opportunities. If a
business opportunity becomes available for the
Company, such persons may face a conflict in
selecting between the Company and their other
business interests. The Company has not formulated a
policy for the resolution of such conflicts.
NOTE 3 - INCOME TAXES
The reconciliation of the effective income tax rate
to the federal statutory rate is as follows:
<TABLE>
<S> <C> <C> <C>
For the
Period from
October 10,
1995
(inception)
December 31, to
----------------------- December 31,
1999 1998 1999
----------- ----------- ----------
Federal Income Tax Rate 34.00 % 34.00 % 34.00 %
Effect of Valuation
Allowance (34.00)% (34.00)% (34.00) %
---------- ---------- ----------
Effective Income Tax
Rate 0.00 % 0.00 % 0.00 %
========== ========== ==========
</TABLE>
Deferred tax assets and liabilities reflect the net
effect of temporary differences between the carrying
amounts of assets and liabilities for financial
reporting purposes and amounts used for income tax
purposes. Significant components of the Company's
deferred tax assets and liabilities are as follows:
- 8 -
BACH-HAUSER, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND DECEMBER 31, 1998
NOTE 3 - INCOME TAXES (Continued)
<TABLE>
<S> <C> <C> <C>
For the
Period from
October 10,
1995
(inception)
December 31, to
----------------------- December 31,
1999 1998 1999
----------- ---------- -----------
Net operating loss $ 2,406 $ 2,406 $ 2,406
carry forward
Valuation allowance (2,406) (2,406) (2,406)
----------- ----------- -----------
Net deferred tax asset $ - $ - $ -
=========== =========== ===========
</TABLE>
At December 31, 1999 and 1998, the Company has
provided a valuation allowance for the deferred tax
asset since management has not been able to determine
whether that asset is realizable. The net change in
the valuation allowance for the years ended December
31, 1999 and 1998 increased by $-0- and $366,
respectively. Net operating loss carryforwards
expire in various amounts in 2015 and 2019.
NOTE 4 - INTANGIBLE ASSETS
Intangible assets consist of property rights which
will be amortized over an estimated useful life of ten
years.
NOTE 5 - STOCKHOLDERS' EQUITY
Year 1999 Forward Stock Split
On April 29, 1999, the Board of the Company authorized
an amendment to the Company's Articles of
Incorporation approving a forward stock split of the
outstanding shares of the Common Stock on the basis of
two-and-a-half new shares of Common Stock for each
share of outstanding Common Stock. The Amendment was
approved at the Special Meeting of the Board of
Directors held on April 29, 1999. This action did not
change the par value of the common Stock of $.001 per
share or the number of authorized shares of the Common
Stock from 50,000,000.
Recent Issuances of Common Stock
On April 29, 1999, the Board of Directors approved the
issuance of 4,500,000 shares to purchase the worldwide
(excluding Canada) rights to TCR Environmental Corp.'s
proprietary waste management/conversion system.
- 9 -
BACH-HAUSER, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND DECEMBER 31, 1998
NOTE 6 - SUBSEQUENT EVENTS
Legal Consulting Plans
On May 1, 2000 and May 10, 2000, the Board of
Directors adopted resolutions to issue 400,000 shares
of common stock as partial payments for legal
services rendered to the Corporation. The stock will
be issued pursuant to the filing of Form S-8 with the
Securities and Exchange Commission.
Stock Split
On April 24, 2000, the Board of Directors authorized
a 2 for 1 stock split.
-10-
EXHIBITS
27 - Financial Data Schedule
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange
Act, the Registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
Bach-Hauser, Inc.
By:/s/ Peter Preston
Peter Preston, President
Date: June 26, 2000
