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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10KSB - a
Annual Report Pursuant to section 13(d) or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended December 31, 1999
International Environmental Management, Inc.
(Exact name of Small Business Issuer as specified in its Charter)
<TABLE>
<S> <C>
NEVADA 65-0861102
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(State or other jurisdiction (IRS Employee
of incorporation or organization) Identification Number)
</TABLE>
5801 Wiley Street Hollywood Florida 33023
(Address of principal executive offices and Zip code)
(954) 961-3033
(Issuer's Telephone Number)
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SECURITIES TO BE REGISTERED UNDER SECTION 12(b) OF THE ACT:
NONE
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Common Stock, Par Value $0.001 Per Share
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No___
Check if there is no disclosure of delinquent filers in response to Item 405 of
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Regulation S-B contained in this form, and no disclosure will be contained, to
the best of the 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]
State issuer's revenues for its most recent fiscal year: $661,729
State the aggregate market value of the and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 day:
The company's common stock is not listed or quoted on any exchange or quotation
service and there is no established public trading market for the Common Stock.
To the knowledge of the Company, trading to date has been irregular and
extremely limited. As of October 1, 1999, the highest of the Company's stock was
$8.75 per share. The 52 week low occurred in February of 1999, at $7.00 per
share.
State the number of shares outstanding of each of the issuer's classes of common
equity, as of December 31, 1999 - the number of outstanding shares as of
12/31/99 was 3,500,000.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I
<S> <C>
ITEM 1. DESCRIPTION OF BUSINESS ................................. 4
ITEM 2. DESCRIPTION OF THE PROPERTY ............................. 11
ITEM 3. LEGAL PROCEEDINGS........................................ 11
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS ..... 11
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS..... 11
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION..... 12
ITEM 7. FINANCIAL STATEMENT........................................... 15
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURES....................................... 15
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS . 15
ITEM 10. EXECUTIVE COMPENSATION........................................ 18
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 19
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................ 21
ITEM 13. FINANCIAL STATEMENTS AND EXHIBITS............................. 22
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
(a) Business Development
The Company was incorporated under the laws of the State of Nevada on
September 6, 1995 as Tirol Pines, Inc. On June 16, 1998, the Company acquired
the net assets of International Environmental Management, Inc. (old-IEMI) in a
reverse merger and changed its name to IEMI. The former shareholder of old-IEMI
received 1,500,000 shares of IEMI common stock representing a majority of the
company's outstanding shares.
Concurrently, on June 16, 1998, the Company entered into a merger
agreement with Broward Recycling, Inc., a Florida corporation ("BRI") which was
wholly-owned by the sole shareholders of old-IEMI. The objective of the two
transactions was to offer the shares of BRI to the public. The operations of BRI
would represent the sole operations of the company, with the former shareholder
of old-IEMI and BRI having the majority ownership and operating control of the
company.
On July 1, 1999, the sole shareholder of BRI of BRI legally transferred
his interests in BRI to IEMI. As the two entities were under common control, the
transfer was accounted for at historical cost in a manner similar to
pooling-of-interests. Following the transaction, BRI became a wholly-owned
subsidiary of IEMI.
BRI has been in the recycling business for approximately 18 years. The
Company seeks to develop its market reach through the acquisition, expansion and
integration of other recycling companies. The Company's goal is to be a
significant regional supplier of non-ferrous recyclable materials. In addition,
it has identified several other recycling opportunities in the non-ferrous
segment.
The merger agreement between IEMI and BRI was re-executed July 1,1999,
and is designated as Exhibit 8 (incorporated by reference to Form 10-sb-a filed
on October 2, 2000). The merger agreement between IEMI and BRI was intended to
resolve any then outstanding defects in the June 16, 1998 merger between IEMI
and Tirol Pines. Exhibits 1 and 2 incorporated herein by reference to the
Company's January 6, 2000 Form 10SB filing with the Commission, relate to the
merger between IEMI and Tirol Pines, whereby 1.5 million shares of Tirol Pines
was conveyed to the owner of IEMI, and whereby Tirol was the surviving
corporation, with its name changed to IEMI. The July 1999 merger between IEMI
and BRI was carried out to give effect to the purpose of the 1998 merger,
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i.e., to convey the assets, rights, and liabilities of Broward to Tirol/IEMI
(Nevada). The 1999 merger was recorded as a merger to which IEMI was a party, as
if the 1999 merger had been conducted in June of 1998 simultaneously with the
merger of IEMI (Nevada) into Tirol.
The total assets of Tirol Pines as of June 15, 1998 was $354.00, while
the total amount of liabilities were $800.00. The total assets of IEMI as of
June 15, 1998 was $68.00, while the total amount of liabilities were $0. The
total assets and liabilities of the combined entity immediately following the
transaction was assets of $422.00 and liabilities of $800.00. The names of the
25 shareholders of Tirol Pines, Inc., immediately preceding the merger, along
with the number of shares held by each shareholder, are found on the Stock
Transfer Ledger of Tirol Pines, Inc., Ex. 9 (incorporated by reference to Form
10-sb-a filed on October 2, 2000).
The number of shares issued in the transaction, and to whom, is
comprised of the following: Harold Solomon (1,500,000 shares); Shareholders 1-5
and 7-25 on Ex. 9 (50,000 shares proportionate to pre-merger holdings); Global
Asset Management, Inc. ("Global"), and Related Parties (750,000 shares held in
the name of Cede & Co; and Aida Carrisquillo, no. 6 on the Ex. 9 and/or Dennis
Jordan relative (200,000 shares held in the name of Cede & Co).
As for any other consideration paid to shareholders of Tirol Pines, IEMI
and any other amounts paid to third parties, Global Asset Management, Inc., paid
$100,000.00 to Dennis Jordan for the 750,000 shares transferred to Global at the
time of the merger. No other consideration was paid.
The percentage ownership of the former shareholders of Tirol Pines,
IEMI, and any other investors in the new entity immediately following the June
16, 1998 transaction is as follows: Former shareholders of Tirol Pines no. 1-5
and no. 7-25 on Ex. 9 (2.5%); Harold Solomon (50%); Global and related entities
(37.5%); and Dennis Jordan and/or Aida Carrisquillo (10%).
In the course of the merger, 950,000 shares were issued pursuant to Rule
144 and are currently held as follows:
<TABLE>
<CAPTION>
Class Beneficial Number of Shares Natural Persons Officer
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Owner Beneficially Held (Director)
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<S> <C> <C>
Common Sam & Raquel Benson 15,000 Individual
Common Maurice Burke 12,500 Individual
</TABLE>
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<TABLE>
<S> <C> <C>
Common Leanardo Castro 5,000 Individual
Common I.O. Marcus 5,000 Individual
Common Jose Pedro Pires 1,500 Individual
Common Henry Watson 6,000 Individual
Common Adrian Yeap 10,000 Individual
Common Kent Whitesel 33,795 Individual
Common Anthony Caliendo 10,000 Individual
Common Independent Securities 200,000 Corporation Jordan
Common GAMP/GAP Escrow 5,000 Corporation Haynes
Common GAP FBO Hampden Kent Group LLC 85,000 Corporation Haynes
Common DVV, Inc 64,500 Corporation Van Vort
Common Investments Plus 12,500 Corporation Gross
Common Opportunity Int'l Group 47,900 Corporation Gross
Common GAMP, Inc 86,305 Corporation Haynes
Common GAMP/GAP Ltd. 150,000 Corporation Haynes
Common Barry Herman 200,000
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Total 950,000
</TABLE>
(b) Business of the Issuer
Through its subsidiary, ("BRI") the Company operated in Hollywood
Florida during the September 6, 1995 through July 1, 1999 period, operating as
Broward Recycling. The company purchased various recyclable metals from the
general public. It sorted and prepared the material to be sold to a wholesaler.
The wholesaler then shipped the material directly to the mills, which are the
end users of the recycled material. The material is melted and manufactured into
new end products. IEMI, as the parent of Broward, currently engages in the same
recycling business.
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Through its subsidiary, BRI, the Company currently operates one
recycling location in South Florida. This operation currently services three
counties: Miami-Dade, Broward, and Palm Beach, for a total population served of
5,000,000 people. The Company is a recycling reclamation and processing facility
which processes up to six tons of recyclable material per day. Such material
includes aluminum, copper, brass, stainless steel, and other non-ferrous
materials. In addition, the Company processes five to ten tons of aluminum cans
per month. The purpose of recycling reclamation and processing facilities is to
process recyclable material so that it may be reused by businesses in the
manufacturing of consumable goods. The Company's primary goal is to create
several divisions which each offer a distinct recycling reclamation product.
Ninety five percent of the material that IEMI purchases is purchased
from the general public, generally small businesses. The company does a very
small amount of business with large industrial accounts. The small business
customers deliver their scrap materials to IEMI. These small business customers
are [a] plumbers who recycle their copper tubing and old brass fixtures; [b] air
conditioning repair services who deliver parts from old units; [c] local garages
which deliver cast aluminum wheels, automobile radiators, aluminum evaporator
coils and assorted aluminum. IEMI does not have any contracts with counties in
Florida at this time. The company does not have contracts with its small
business clients. The company pays its small accounts in cash.
IEMI is not tied to one particular source to sell material. Prices are
determined by local conditions. The company sells its material to the buyer that
offers the highest price, most favorable terms of payment, and most favorable
pickup service. The company does not have in place any purchase agreements for
its finished material.
The market for the company's raw finished goods includes the local
entities to whom it sells, and an overseas market. The local market includes
purchasers such as Titan Recycling and Arrow Recycling. The overseas market
includes International Global Metals and East Coast Scrap Metal.
IEMI complies with environmental regulations by obtaining all of the
necessary permits and licenses to operate its facility. The company has current
local City of Hollywood licenses, a regional Broward County license, and a State
of Florida certification to conduct business as a Secondary Metals recycling
facility. No additional licenses or permits beyond those in place are required
for the company's operations at this time. As the Company grows and expands its
business, it may in the future accept material that requires special handling.
IEMI would at that time acquire any necessary licenses or permits.
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The industry is highly fragmented and ripe for consolidation through
acquisition. The Company believes that its subsidiary, BRI, has the experience
necessary to acquire solid companies in this profitable and growing industry.
The company filed a Form 10-SB to create the potential for capital formation to
implement the company's proposed acquisition plan. It is anticipated by
management of the company that liquidity of the company's shares, combined with
a potentially favorable market response to the company, will facilitate the
company as it moves forward to implement its acquisition plan.
Beginning in early 1990, Broward had a large contract with the City of
Hollywood, Florida. That contract was discontinued in March 16, 1996. As a
consequence of that loss, Broward's auditors in 1997 expressed its doubts about
the viability of Broward as a going concern. Accordingly, the Company embarked
upon a plan to acquire capital and enhance the liquidity of the Company's shares
with a view to moving beyond this concern. In this regard, the Company received
paid in capital in cash and notes in 1999 and 2000.
The Company intends to establish a central processing facility and have
two or three recycling facilities on line which should enable the Company to
expand the number of recyclable items it handles such as newspaper, cardboard,
glass bottles and plastic. As the Company develops these facilities, it will be
in a position to expand its wholesale recycling business. For example, the
Company currently purchases copper, brass and aluminum from plumbing and air
conditioning repair businesses as well as radiators from car radiator shops and
local garages. Using this strategy, the Company believes that within two or
three years, it can position itself to operate as a profitable, integrated
recycling business.
The Company's primary business objective is to enhance its revenue
growth through the acquisition and consolidation of other scrap metal
businesses. Acquisition targets should have a successful operating history which
means a record of growth and profitability. Management intends to retain the
owners and experienced management of such acquisitions because their knowledge
and expertise can provide immediate entry in the market. In addition,
acquisition targets should be located in major market areas and should either be
the leader in its respective market, or have the potential to assume the first
or second position in that market. The Company will prefer target facilities
located along the southeast Florida economic area or having access to
transportation. The company prefers to merge with or acquire facilities that are
close to a highway or expressway. IEMI intends to acquire facilities with clear
access to at least one major roadway. Such locations facilitate receipt of raw
materials and resale of raw finished
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goods. This would enable the Company to ship large volumes of material to major
consumers.
Another strategy of the Company is to develop the capacity to recycle
products other than non-ferrous metals. This could be accomplished through the
establishment of a central processing facility, with two to three recycling
facilities on line. This should enable the Company to expand its wholesale
recycling business and to develop a ferrous (steel) recycling division. The
wholesale division will work with existing businesses.
The Company also intends to have a container service division located in
South East Florida, if negotiations proceed successfully. The potential value of
the market for this service is $5-$10 billion, within the Company's operating
geographic range. The source for this statement is the October 26, 1996 edition
of "Waste News;" article entitled "Chicago Firm Targets Larger Scrap Industry,"
author, Tom Andreoli. Principal users of this service are real estate
developers, who need containers on site to remove construction debris. To enter
this market, the Company must build a facility, acquire a small fleet of trucks,
and acquire containers. The cost of this undertaking is projected at
approximately $750,000.
As the Company grows, it intends to establish a solid waste-brush and
yard waste composting facility. Municipalities are coming to the realization
that incineration and land filling are not the most environmentally sound ways
of handling their solid waste, trash and brush material. (Brush material is yard
waste such as tree trimmings, grass clippings, and associate shrubs, weeds, or
other plant life.) The Company believes this business segment of the market has
a potential value of $250-$500 million. To implement this strategy, the Company
must build the facility referenced in the preceding paragraph. The Company
projects that entry into this industry sector would be feasible in the third or
fourth quarter of the year 2000.
Consulting services are yet another strategy for growth in the industry.
Many, if not most, of the communities in the U.S. are imposing mandatory
recycling requirements on the businesses community. The Company intends to
position itself to respond to this emerging market offering recycling consulting
services to assist businesses in compliance with governmental regulations. To
implement this strategy, the Company must employ two consultants.
A final strategy for growth would be entry into the solid waste and
landfill management business. The Company perceives a window of opportunity to
acquire smaller privately owned landfills. There are several hundred of these
landfills nationwide and are selling in the $3 million to $10 million range.
Such an acquisition would provide
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immediate cash flow and substantial net profit to the Company's operations.
Management believes it is essential to get a solid waste landfill division on
line as soon as possible.
The Company has no product, or product in development, which would
materially impact its financial and operating condition. The Company is not
dependent upon the availability or raw materials in order to operate. The
Company does not rely on any patents, copyrights, trademarks, or other
intellectual property in order to operate. The Company's operations are not
affected by seasonal changes. The Company does not maintain a material amount of
production inventory. The Company does not extend terms to customers. The
Company is not dependent upon a single customer or a small group of customers.
The largest customer of the Company purchases less than 5% of the Company's
production. There is no back log in the Company's production. The Company does
not rely on government contracts for its revenues.
The Company is aware there is significant competition in the recycling
industry. The Company will be competing with numerous companies that already
have a substantial share of the market as well as greater management and
technological resources. Competitors also may have greater financial resources
than that of the Company. Current local competition and local conditions are as
follows. The Company's local market is primarily in Miami-Dade, Broward and Palm
Beach counties. There are several dozen small to medium size scrap metal
recycling dealers. There are five or six larger dealers and a few wholesale
companies that ship all of their material direct to the mills who are the end
users. Many of the small and medium size operations buy and sell on a weekly
basis and do not have the resources to compete with the few larger operations.
It is a highly fragmented industry. The Company believes this market is ready
for consolidation. Each small and medium size operation can only handle what is
delivered to them or they can pick-up in a very small radius from their location
The Company's goal is to become the number one regional scrap metal recycling
operation in the south Florida area.
The Company is not regulated by any federal or state regulatory agency
with regard to environmental matters.
The Company employs two full time managerial staff at the parent level,
and five full and part time non-management employees at the subsidiary level.
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ITEM 2. DESCRIPTION OF PROPERTY
The Company owns its headquarters and operating facility at 5801 Wiley
Street Hollywood, Florida 33023. The estimated value of the land and building is
$225,000. The company owns operating equipment with a depreciated value of
approximately $50,000.
ITEM 3. LEGAL PROCEEDINGS.
The Company is not a party to any litigation nor, to the knowledge of
management, is any litigation pending or threatened against the Company. The
Company is not a party to any other legal proceedings which would have a
material impact on the Company's operations and/or financial condition, nor is
the Company aware of any such threatened proceeding.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no submissions of matters to a vote of security holders.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
At December 31 1999, there were 34 holders of Common Stock. The
Company's Common Stock is not listed or quoted on any exchange or quotation
service and there is no established public trading market for the Common Stock.
To the knowledge of the Company, trading to date has been irregular and
extremely limited. As of October 1, 1999, the highest price of the Company's
stock was $8.75 per share. The 52 week low occurred in February of 1999, at
$7.00 per share.
The Company will seek a market maker to submit an application with
NASDAQ's OTC Bulletin Board to have its Common Stock quoted. In order to be
approved for OTC Bulletin Board quotation, the Company must be current in
reporting pursuant to the Securities and Exchange Act of 1934. The Company will
seek to encourage at least one market maker for the Common Stock. Making a
market involves maintaining bid and ask quotations and being able, as principal,
to effect transactions in reasonable quantities at those quoted prices, subject
to various securities laws and other regulatory requirements.
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The development of a public market having the desirable characteristics
of depth, liquidity and orderliness depends upon the presence in the marketplace
of a sufficient number of willing buyers and sellers at any given time, over
which neither the Company nor any market maker has any control. Accordingly,
there can be no assurance that an active and liquid trading market for the
Common Stock will develop, or if a market develops, that it will continue.
The Board of Directors may consider paying dividends in the future and
will periodically review its policy regarding dividends. Declaration of
dividends, if any, by the Board of Directors will depend upon a number of
factors, including capital requirements, investment opportunities available to
the Company or the Bank, capital requirements, regulatory limitations, the
Company's results of operations and financial condition, tax considerations and
general economic conditions, as well as other relevant factors. No assurances
can be given, however, that any dividends will be declared, what amount the
dividends will be, or whether such dividends, once commenced, will continue to
be paid. The Company may pay stock dividends in lieu of, or in addition to, cash
dividends. The Company has not paid any dividends since its inception, however,
it intends to pay dividends as soon as business operations permit.
ITEM 6. MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
ASSUMPTIONS
The following management's discussion and analysis or plan of operation
is based on the enclosed financial statements exhibit.
The Company acquired Broward Recycling, Inc. on July 1, 1999. The
financial statements reflect the condition of the Company and the acquisition as
occurred in the prior periods being discussed.
RESULTS OF OPERATIONS
Year ended December 31, 1999, compared to Year Ended December 31, 1998.
IEMI's net revenues for Year Ended 1999 increased by 18% compared to 1998 (The
1999 numbers for comparison are Broward Recycling, prior to the acquisition by
IEMI in June of 1999).
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The Company's significant revenue improvement is almost entirely directly
related to local sales and marketing efforts, and expansion of its international
business segments. During the fourth quarter, 1999, IEMI started recycling
cruise ship aluminum cans from international (mainly Caribbean) ports, which is
continuing and has also started its own pick up service for a targeted
commercial customer group.
The Company expects revenue for the future to be up significantly as management
continues to infuse capital, following its business plan. Revenue is partly a
function of the mix of material types and the instability of the metals markets,
which is difficult to predict. Revenue is also subject to the impact of the
economic conditions in the various geographic regions that the Company services,
both domestically and internationally. The Company is on target to exceed $1.0
million in sales and expects to reach this Year 2000 business objective.
The total Cost and expenses for the Company were up only 8% for 1999 versus 1998
Year end time frame. The Company's losses were reduced by $42,000 or
approximately 26%.
The actual loss for 1999 was $117,185. On a per share basis, the Company lost
less than $ (.06) per common share in 1999 and an improvement of about $.05 per
share. The loss improvement is attributable to increased sales and an aggressive
marketing program, designed to increase the company's operating range.
The Company's administrative expenses have increased significantly, year over
year, due to its current business plan and model, which includes an aggressive
marketing and acquisition plan.
The loss is attributable to the expansion and acquisition plan the Company has
put forward for the year 2000.
That process has translated into very expensive general and administrative
expenses. Without the acquisition expenses, the Company would have been
profitable in the second quarter. The Company has filed its Form 10-SB with the
Securities and Exchange Commission and has made three amendments to that filing.
The Company expects the gross profit percentage to increase several points in
the third quarter and for that trend to continue during the remainder of 2000.
IEMI's gross margin percentages in any period varies dependent on the product
mix, as well as the need of the metals market, supply and demand. The Company is
implementing new cost control measures to increase gross margin. Various other
factors such as metals yield and
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inventory levels will also continue to affect the amount of cost of sales and
the variability of gross margin percentages.
A worst case scenario involving a critical supplier of raw materials
would be the partial or complete shutdown of the supplier and its resulting
inability to provide materials to the Company on a timely basis. Where efforts
to work with suppliers continue, contingency planning has emphasized the
identification of secondary sources.
Spending on its acquisition plan will continue throughout 2000.
The Company does not expect a change in tax rate and anticipates no corporate
income tax for year 2000.
It became a fully reporting firm on February 6, 2000.
IEMI is not currently party to any legal proceedings.
The Company continues to receive financial support from its venture capitalist
and is committed to receiving funds in excess of $550,000 during the year 2000.
Liquidity and Capital Resources
The Company has in recent years financed its operations primarily with
loans directly from and/or guaranteed by the principle shareholders. The Company
anticipates that revenues from operations will be able to satisfy the Company's
cash requirements. Periodic equity financing has assisted the Company in working
towards this goal during the subsequent six month period. No assurance can be
given, however, that additional debt or equity financing will not be required or
will be available if required
Present cash on hand is not sufficient to meet the Company's operating plan as
stated in the original management discussion and analysis. Although each month
the company is improving its position, the Company will continue to seek equity
funding during the next six month period to meet its business objectives. The
alternative financial support will come from Global Capital Group.
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ITEM 7. FINANCIAL STATEMENTS
The following table sets forth the current year and last two years of operating
data from the Company's South Florida market area.
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS DATA
YEAR ENDED DECEMBER 31,
1997 1998 1999
----------------------------------------
<S> <C> <C> <C>
TOTAL REVENUE $718,178 $560,152 $ 661,729
TOTAL COSTS AND EXPENSES $721291 $ 720,106 $ 778,914
PROFIT (LOSS) FROM OPERATIONS $(3,113) $(159,954) $(117,185)
NET PROFIT (LOSS) APPLICABLE TO COMMON
SHAREHOLDERS $(3,113) $(159,954) $(117,185)
NET PROFIT (LOSS) PER COMMON SHARE $(0.0013) $(0.1019) $(0.0546)
BALANCE SHEET DATA
YEAR ENDED DECEMBER 31,
WORKING CAPITAL $(254,031) $(239,925) $ 111,281
TOTAL ASSETS $155,217 $154,979 $ 324,034
TOTAL LIABILITIES $300,575 $ 494,292 $223,390
STOCKHOLDERS' EQUITY (ACCUMULATED DEFICIT) $(145,358) $(339,313) $ 100,644
</TABLE>
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
None.
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS
The Board of Directors of the Company is currently composed of five
members, each of whom serves for a term of one year. Executive officers are
elected annually by the Board of Directors and serve at the Board's discretion.
The following table sets forth information with respect to the directors and
executive officers of the Company.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
NAME AGE POSITION CURRENT TERM EXPIRES
---- --- -------- ------------ -------
</TABLE>
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<TABLE>
<S> <C> <C> <C> <C>
Harold Solomon 45 Chairman, CEO, Pres July 1999 2000
George R. Keller, Jr. 44 Director July 1999 2000
Francis LaTorre 31 Director July 1999 2000
Anthony Caliendo 30 Director July 1999 2000
Sam Benson 43 Director July 1999 2000
</TABLE>
All directors hold office until the next annual meeting of the Company
(currently expected to be held during the first Monday of December 2000) and
until their successors are elected and qualified, subject to earlier removal and
replacement by the shareholders. Officers hold office until the first meeting of
directors following the annual meeting of shareholders and until their
successors are elected and qualified, subject to earlier removal and replacement
by the Board of Directors. All of the directors reside in the State of Florida.
Harold Solomon currently serves as Chairman of the Board, CEO and President of
the Company. Mr. Solomon founded BRI in 1980 and has been overseeing its
operation since it was formed. He transformed BRI from an old fashioned
"junkyard" into a complete non-ferrous scrap metal recycling facility. Mr.
Solomon, with 19 years experience in the field of recycling, has also instituted
programs for inventory control, process management and quality control
procedures. He is responsible for the hiring and training of employees, and for
the Company's public relations, marketing and advertising. Prior to forming BRI,
Mr. Solomon was the Director of Admission and Records at Florida International
University. He was part of the team that formed the University's North Miami
campus and initiated many of the procedures in the Admission and Records office
that helped the new campus grow and prosper. Mr. Solomon holds a B.A. in History
and Educational Administration, with a Minor in Music Education, from Florida
International University. Mr. Solomon also currently serves as the President of
the Hollywood Philharmonic Orchestra.
George R. Keller, Jr. currently serves as a Director/Treasurer. Mr. Keller is
the Assistant Director, Department of Safety and Emergency Service for Broward
County. Mr. Keller previously served as the Director of the Department of
Development Administration of the City of Hollywood, Florida. He was also
previously employed by the Urban and Regional Research Center in Gainesville.
Mr. Keller held the following positions in the City of Hollywood: Assistant City
Manager
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(Interim City Manager), Director or Development Administration, Planning
Administrator, Community Development Director and Post Disaster Recovery
Director. Much of Mr. Keller's work experience has been in the areas of land use
planning, zoning, real estate development, urban redevelopment economic
development, annexation, emergency management and code enforcement. Recently, in
the spring of 1999, Mr. Keller completed the Community Emergency Response Team
(CFRT) training program available to local residents. Other professional
memberships and affiliations include: the International City/County Manager's
Association, American Institute of Certified Planners (AICP), American Planning
Association, Hollywood Housing Authority (former Commissioner), 1990 Price
Waterhouse/South Florida Business Journal "Up & Comers" Award, Florida Real
Estate License (inactive), Juvenile Diabetes Foundation and Broward County
Humane Society. He holds a B.S. Degree in Urban Geography and a M.A.T. Degree in
Urban Geography and Urban and Regional Planning from the University of Florida,
Gainesville, Florida
Francis LaTorre serves as a Director. He is a Loan Consultant to South Florida
Mortgage Consultants, Inc., and a realtor for Broward Real Estate Sales Co.,
Inc. He previously worked in sales for Galacticomm., Inc. While active duty in
the US Navy, Mr. LaTorre received the Hospital Corpsman Certificate with honors
from the Naval School of Health Sciences, San Diego. Mr. LaTorre is a 1995
graduate of Columbia College. Mr. LaTorre also serves as Chairperson of the
finance committee of the Hollywood Philharmonic Orchestra.
Anthony Caliendo currently serves as a Director/V.P. Sales & Marketing. He is
presently a Sales Manager for Global Asset Partners, of Nassau, Bahamas, an
asset management company. (See, "Conflicts of Interest".) He has previously
served as a loan officer for K&B Capitol, and as Finance Manager for Royal Palm
Homes, both in Boca Raton, Florida. He also held various management positions
with Bally's Fitness Corp. Mr. Caliendo held both General Manager and District
Manager positions with Bally's Fitness Corp. in Chicago, from 1987 to 1990. At
age 18, he was the youngest G.M. in Bally's history and as District Manager, he
was recognized for his managerial and marketing skills by earning Manager of the
Year, Employee.- of the Year and Salesman of the Year Awards, in addition to
winning Bally's Annual National Sales Contest.
As General Manager of two different World Gym locations in Chicago in 1992
and 1993, Mr. Caliendo oversaw Human Resources, Marketing and Sales, exceeded
sales projections of over $2 million, and helped to make the World Gym the
fastest growing fitness facility in Chicago. In 1994, as a General Securities
Representative (NASD I Series Seven) for a small boutique investment banking
firm in South Florida, Mr. Caliendo became the top producer within 4 months,
recruited brokers and conducted
-17-
<PAGE> 18
training courses and raised equity in excess of $2 million. At present, Mr.
Caliendo serves as the Vice President of Investor Relations for Royal Palm
Homes, a real estate development company in South Florida. He is also a Loan
Officer for K&B Capital Corp., currently engaged in several commercial finance
ventures and residential mortgages, and also serves as a Sales Manager for
Global Asset Partners, working in Investment Banking Financing and training new
Account Executives.
Sam Benson currently servers as a Director/Secretary. Mr. Benson graduated in
1978 from the University of Miami with a B.B.A. in International Finance and
Marketing, From 1978 to 1982 Mr. Benson worked for Quaker Oats. First to set up
major accounts for Quaker Oats in South Florida, he was then the Southeast
United States liaison for these major accounts. From 1982 to 1986 Mr. Benson
attended medical school, graduating in 1986 with his M.D. degree. From 1986 to
1989 Mr. Benson participated with a South Florida pediatrician. From 1989 to
present Mr. Benson has worked for Elise Undergarment in various management
capacities. For the past year he has been responsible for their locating and
building a facility in Urnanl Mexico.
ITEM 10. EXECUTIVE COMPENSATION.
Mr. Solomon is compensated at the rate of $120,000 per year plus customary
benefits.
Mr. Albert Massucco, Jr., is compensated at the rate of $65,000 per year.
Mr. Solomon and Mr. Massucco are the only members of management of the Company
who receive regular salaried compensation.
All officers and directors will be reimbursed for any expenses incurred on
behalf of the Company. Directors will be reimbursed for expenses pertaining to
attendance at meetings, including travel, lodging and meals.
-18-
<PAGE> 19
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth, as of August 1, 2000, the shares of common stock
beneficially owned by each person who was a beneficial owner of more than five
percent of the outstanding shares of common stock and by directors and executive
officers.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
NUMBER OF SHARES PER CENT OF
CLASS OF SHARES BENEFICIAL OWNER BENEFICIALLY HELD BENEFICIAL OWNERSHIP
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Harold Solomon 1,500,000 42.9%
5801 Wiley Street
Hollywood
FL 33023
-----------------------------------------------------------------------------------------------
Common Global Capital 225,000 6.4%
Group, Inc.
225 Mizner Blvd
Boca Raton
FL 33432
David Van Vort
President
-----------------------------------------------------------------------------------------------
Common Global Capital 215,000 6.1%
Management
Group Inc
14999 W. Palmetto
Park Road
Boca Raton
FL 33486
William Haynes
President
-----------------------------------------------------------------------------------------------
</TABLE>
-19-
<PAGE> 20
<TABLE>
<S> <C> <C> <C>
-----------------------------------------------------------------------------------------------
Common DVV Investments Inc. 180,000 5.1%
428 Wavecrest Ct.
Boca Raton
FL 334323
Jeff Monroe
President
-----------------------------------------------------------------------------------------------
Common Palmetto Art 130,000 3.7%
Associates, Inc.
3094 Westbury H
Deerfield Beech
FL 33442
Karina Vidal
President
-----------------------------------------------------------------------------------------------
Common Q Capital, Inc. 125,000 3.6%
5551 Marbella Dr.
Boca Raton
FL 33433
Karina Vidal
President
-----------------------------------------------------------------------------------------------
Common Opportunity Int'l 172,900 4.9%
Group, Inc.
9953 Ramblewood
Drive
Coral Springs
FL 33071
Rochelle Gross
President
-----------------------------------------------------------------------------------------------
Common Kent Whitesel 43,795 1.3%
-----------------------------------------------------------------------------------------------
Common Anthony Caliendo 10,000 0.3%
-----------------------------------------------------------------------------------------------
Common Independent 200,000 5.7%
Securities, Jordan,
Director
-----------------------------------------------------------------------------------------------
</TABLE>
-20-
<PAGE> 21
<TABLE>
<S> <C> <C> <C>
-----------------------------------------------------------------------------------------------
Common GAMP/GAP Escrow, 5,000 0.1%
William Haynes,
Director
-----------------------------------------------------------------------------------------------
Common GAP FBO Hampden Kent 85,000 2.4%
Group, LLC, William
Haynes, Director
-----------------------------------------------------------------------------------------------
Common DVV, Inc., 64,500 1.8%
David Van Vort,
Director
-----------------------------------------------------------------------------------------------
Common Investments Plus, 12,500 .4%
Rochelle Gross,
Director
-----------------------------------------------------------------------------------------------
Common GAMP, Inc., William 86,305 2.5%
Haynes, Director
-----------------------------------------------------------------------------------------------
Common GAMP/GAP Ltd., 150,000 4.3%
William Haynes,
Director
-----------------------------------------------------------------------------------------------
Common Barry Herman 200,000 5.7%
-----------------------------------------------------------------------------------------------
</TABLE>
The shareholders identified above other than Mr. Solomon and Mr. Herman comprise
a group as that term is defined in Section 13(d)(3) of the Exchange Act.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company was incorporated on September 6, 1995. Since its
incorporation, the Company has issued 3,500,000 shares of its Common Stock. A
majority of these shares are held by the Company's President and CEO.
On June 2, 1999, the Company entered into a Consulting Agreement with
Global Capital Management, Inc. ("Global"), whereby Global will offer strategic
advice regarding
-21-
<PAGE> 22
capitalization, capital structure, potential investors, corporate transactions,
in order to implement the Company's business plan. Pursuant to the Consulting
Agreement, Global received 200,000 shares of the Company's common stock, and
Global's right to hold the shares was renewed in the 1999 Consulting Agreement.
The consulting agreement is Ex. 6 to the Form 10SB (previously filed,
incorporated by reference to January 6, 2000 submission).
In addition, Global received the right to purchase up to $950,000 of the
stock in the limited offering conducted by the Company in late 1999 and early
2000, pursuant to Rule 504 which stock was issued without restrictive legend.
The application of Rule 504 to the offering is discussed under Item 8 within the
Company's Amended Form 10-SB Registration Statement. The shares were issued
effective September 11, 2000 and January 23, 2000.
The Company has entered into loan transactions with certain related
parties, as set forth on the unaudited consolidated financial statements for the
period ended September 30, 1999. The parties to the loans are as follows (1998
dollar amount of loan followed by name): $18,194, Betsy Firger, private mortgage
holder; $25,000, George Klien, shareholder; $115,134, Dr. Joseph Rosaler,
private mortgage holder; $60,000, Robert Elmore, business associate; $11,125, Al
Massucco, Sr., relative of employee; $12,348, Diane Hasett, relative of
employee.
Mr. Anthony Caliendo, a director of the Company, is employed as a Sales
Manager for Global Asset Partners, a Bahamian asset management company. Global
Asset Partners, Ltd., is affiliated with Global Capital Management, Inc. through
certain common ownership.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8K
Please see attached Consolidated Financial Statements - December 31, 1999 and
1998 - for International Environmental Management, Inc.
The exhibits that are required to be filed herein are incorporated by reference.
-22-
<PAGE> 23
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
<PAGE> 24
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
INDEPENDENT AUDITORS' REPORT 1
CONSOLIDATED BALANCE SHEET 2
CONSOLIDATED STATEMENT OF OPERATIONS 3
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY 4
CONSOLIDATED STATEMENT OF CASH FLOWS 5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 6 - 9
</TABLE>
<PAGE> 25
BAUM & COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
1515 UNIVERSITY DRIVE - SUITE 209
CORAL SPRINGS, FLORIDA 33071
(954) 752-1712
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
International Environmental Management, Inc. and Subsidiary
Hollywood, Florida
We have audited the accompanying balance sheets of International Environmental
Management, Inc. and Subsidiary as of December 31, 1999 and 1998 and the related
statements of operations, stockholders' equity and cash flows for the years
ended December 31, 1999 and 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our 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 International Environmental
Management, Inc. and Subsidiary as of December 31, 1999 and 1998 in conformity
with generally accepted accounting principles.
/s/ Baum & Company, P.A.
-----------------------------------
July 15, 2000
Coral Springs, Florida
<PAGE> 26
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
ASSETS
1999 1998
----------- ---------
<S> <C> <C>
Current Assets
Cash on hand $ 1,571 $ 1,856
Inventory 19,167 4,728
Receivables 126,500 - 0 -
----------- ---------
147,238 6,584
Property, Plant and Equipment
(Net of $108,920 and $109,199 of accumulated depreciation,
respectively) 170,473 141,485
Other Assets
Deferred costs (net of $1,227 and $640 of accumulated
amortization, respectively) 5,983 6,570
Deposits 340 340
----------- ---------
Total Assets $ 324,034 $ 154,979
=========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes Payable - Current Portion $ - 0 - $ 111,831
Accounts payable and accrued expenses 8,203 82,604
Cash overdraft 2,818 3,411
Customer deposits 18,152 23,284
Payroll taxes 6,784 - 0 -
Shareholders' Loans - 0 - 160,280
----------- ---------
Total Current Liabilities 35,957 381,410
Long Term Liabilities
Notes Payable 187,433 112,882
----------- ---------
Total Liabilities 223,390 494,292
----------- ---------
Stockholders' Equity
Common Stock, $.001 Par Value 3,500,000 and 2,500,000
Shares, respectively, authorized 25,000,000 Issued and
Outstanding 3,500 2,500
Additional paid in capital 679,471 23,668
Accumulated deficit (582,327) (365,481)
----------- ---------
Total Equity 100,644 (339,313)
----------- ---------
Total Liabilities and Stockholders' Equity $ 324,034 $ 154,979
=========== =========
</TABLE>
SEE ACCOUNTANTS' REPORT AND ACCOMPANYING FOOTNOTES
-2-
<PAGE> 27
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31,1999 and 1998
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Revenues $ 661,729 $ 560,152
Cost of Goods Sold 457,830 429,462
----------- -----------
Gross Profit 203,899 130,690
----------- -----------
Salaries and Wages 164,360 68,440
Legal and Accounting 12,224 82,838
Other General and Administrative Expenses 144,500 139,366
----------- -----------
Total Operating Expenses 321,084 290,644
----------- -----------
Income (Loss) Before Other Income and (Expense)
and Provision for Income Taxes (117,185) (159,954)
Other Income (Expense)
Interest Expense (32,865) (33,696)
----------- -----------
Income (Loss) Before Provision For Income Taxes (150,050) (193,650)
Provision for Income Taxes - 0 - - 0 -
----------- -----------
Net Income (Loss) (150,050) (193,650)
=========== ===========
Loss Per Common Share (0.0546) (0.1019)
=========== ===========
Weighted Average Common Shares Outstanding 2,750,000 1,900,000
=========== ===========
</TABLE>
SEE ACCOUNTANTS' REPORT AND ACCOMPANYING FOOTNOTES
-3-
<PAGE> 28
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
ADDITIONAL
COMMON STOCK PAID-IN ACCUMULATED
# SHARES AMOUNT CAPITAL DEFICIT
--------- -------- ------------ ---------------
<S> <C> <C> <C> <C>
December 31, 1997 1,000,000 $ 1,000 $ 25,000 $ (171,458)
Issuance of common stock 1,500,000 1,500
Adjustments to capital to reflect
acquisition of subsidiary -- (1,432) (373)
Net (Loss) December 31, 1998
--------- -------- ------------ ---------------
December 31, 1998 2,500,000 $ 2,500 23,668 (365,481)
--------- -------- ------------ ---------------
Issuance of common stock 1,000,000 1,000 655,803 --
Distribution to Shareholders -- (66,796)
Net (Loss) December 31, 1999 (150,050)
--------- -------- ------------ ---------------
December 31, 1999 3,500,000 $ 3,500 $ 679,471 $ (582,327)
========= ======== ============ ===============
</TABLE>
SEE ACCOUNTANTS' REPORT AND ACCOMPANYING FOOTNOTES
-4-
<PAGE> 29
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
STATEMENTS OF CASH FLOW
FOR THE YEAR ENDED DECEMBER 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Cash Flow from Operating Activities
Net (Loss) $ (150,050) $ (193,650)
Adjustments to reconcile net loss to net cash used for operating
activities:
Depreciation 9,512 6,984
Amortization 587 640
Changes in assets and liabilities:
(Increase) in inventory (14,439) (220)
(Increase) in receivables (126,500) - 0 -
Decrease in loans receivable 34,500 - 0 -
(Decrease) Increase in notes payable (146,331) 44,579
(Decrease) Increase in accounts payable (74,401) 42,026
(Decrease) in cash overdrafts (593) (3,110)
(Decrease) in customer deposits (5,132) (3,616)
(Decrease) Increase in shareholder loans (160,280) 41,892
Increase in taxes payable 6,784 - 0 -
----------- -----------
Net cash used in operating activities (626,343) (64,475)
----------- -----------
Cash flows from investing activities
Acquisition of property, plant, and equipment (38,500) - 0 -
----------- -----------
Cash flows from financing activities:
Proceeds from additional paid-in capital and
common stock 656,803 68
Distributions to shareholders (66,796) - 0 -
Proceeds from notes and loans 74,551 71,946
----------- -----------
Net cash flows from financing activities 664,558 72,014
----------- -----------
Net increase (decrease) in cash (285) (44)
Cash - beginning 1,856 1,900
----------- -----------
Cash - ending $ 1,571 $ 1,856
=========== ===========
</TABLE>
SEE ACCOUNTANTS' REPORT AND ACCOMPANYING FOOTNOTES
-5-
<PAGE> 30
SEE ACCOUNTANTS' REPORT AND ACCOMPANYING FOOTNOTES
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUSINESS AND ORGANIZATION
IEMI is in the business of collecting and processing scrap metal through
its wholly-owned subsidiary Broward Recycling Inc. (a Florida
Corporation). IEMI was organized in 1998. On June 16, 1998, IEMI
acquired the non-operating public shell of Tirol Pines, a Nevada
corporation, in a transaction accounted for as as recapitalization. The
only former shareholder of IEMI received 1,500,000 shares common stock
representing a majority of the company's outstanding shares.
Also on June 16, 1998, the company entered into a merger agreement with
Broward Recycling, Inc. (BRI), a company incorporate d in the state of
Florida on July 1, 1981 and which was wholly-owned by the former
shareholder of IEMI. The objective of the two transactions was to offer
the shares of BRI to the public. The operations of BRI would represent
the sole operations of the company, with the former shareholder of IEMI
and BRI having majority ownership and operating control of the company.
On July 1, 1999, the sole shareholder of BRI legally transferred his
interests in BRI to IEMI. As the two entities were under common control,
the transfer was accounted for at historical cost in a manner similar to
a pooling of interests. Following the transaction, BRI became a
wholly-owned subsidiary of IEMI.
BASIS OF PRESENTATION
These financial statements present the operations of IEMI and BRI on a
consolidated basis as though the companies had been combined from the
beginning of the periods presented. The effects of all significant
intercompany accounts and transactions have been eliminated.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiary Broward Recycling, Inc. All
significant intercompany accounts and transactions have been eliminated.
ORGANIZATIONAL COSTS
The Company and its subsidiaries are amortizing their deferred costs
over a five year period on a straight line basis. Amortization expense
for the year ended December 31, 1999 was $587.
USE OF ESTIMATES
The accounting and reporting policies of the Company are in conformity
with generally accepted accounting principles. The presentation of
financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
period. Actual
-6-
<PAGE> 31
results can differ from those estimates.
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INVENTORIES
Inventories (stated at the lower of cost or market value) consist of
scrap metal.
FIXED ASSETS
Fixed Assets are stated at cost and depreciated over their estimated
allowable useful lives (5 to 39 years), utilizing both the straight-line
and declining balance methods. Expenditures for major renewals and
betterments that extend the useful lives of fixed assets are
capitalized. Expenditures for maintenance and repairs are charged to
expense as incurred.
CUSTOMER DEPOSITS
The Company obtained advances and deposits from certain vendors for
working capital purposes. These deposits are periodically applied to
accounts receivable.
Revenue Recognition
Revenue is recognized upon the sale of scrap metal.
Earnings (Loss) Per Share
Primary earnings per common share are computed by dividing the net
income (loss) by the weighted average number of shares of common stock
outstanding during the year. The number of shares used for the fiscal
year ended December 31, 1999 was 2,750,000.
NOTE 2 - PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <C> <C>
Land $ 50,000 $ 50,000
Building 127,058 127,058
Machinery and equipment 90,615 73,536
Furniture and fixtures 11,720 - 0 -
---------- ----------
Total 279,393 $ 250,594
Less: Accumulated Depreciation (108,920) ( 109,109)
---------- ----------
Net Property Plant and Equipment $ 170,473 $ 141,485
========== ==========
</TABLE>
NOTE 3 - LEASING COMMITMENTS
The Company has entered into various leases for equipment in 1999 under
agreements classified as capital leases. Assets under capital leases in
accordance with FASB 13 are capitalized using interest
-7-
<PAGE> 32
rates appropriate at the inception of the lease.
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
NOTE 3 - LEASING COMMITMENTS (CONTINUED)
The following is a schedule of future minimum lease payments under the
capital leases together with the present value of the net minimum lease
payments as of December 31, 1999.
<TABLE>
<CAPTION>
Year ending December 31:
<S> <C>
2000 $ 9,252
2001 8,065
2002 8,042
2003 8,623
--------
Total future minimum lease payments $ 33,982
========
</TABLE>
NOTE 4 - NOTES PAYABLE
Notes Payable consist of the following:
<TABLE>
<S> <C>
Note Payable, individual, 12.9%
interest, secured by mortgage on Company
land and building, monthly payments
$1,460, matures September 2013. The
principal and interest of the 1997
balance was refinanced in 1998 $ 112,552
Note incurred to settle a litigation
payable in monthly installments of $1,200
Unsecured and non-interest bearing 38,400
Capitalized equipment leases secured by
equipment 36,481
---------
Total notes payable and leases payable $ 187,433
=========
</TABLE>
NOTE 5 - INCOME TAXES
Under FASB 109 deferred tax assets and liabilities are recognized for
the estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing
-8-
<PAGE> 33
assets and liabilities and their respective tax bases. The Company has
net operating losses (NOL's) of
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
NOTE 5 - INCOME TAXES (CONTINUED)
approximately $300,000 expiring through 2014.
<TABLE>
<S> <C>
Deferred tax benefit $ 100,000
Valuation allowance (100,000)
---------
Net Benefit $ - 0 -
=========
</TABLE>
Due to uncertainty of utilizing the NOL and recognizing the deferred tax
benefit an offsetting valuation allowance has been provided.
NOTE 6 - CAPITAL TRANSACTIONS
On May 22, 1998, the Company amended its Articles of Incorporation to
increase its authorized shares of common stock from 25,000 shares to
25,000,000. Additionally the Board of Directors approved a 40 to 1
forward stock split of its common stock thereby increasing the number of
outstanding shares from 25,000 to 1,000,000. A further 1,500,000 shares
were issued on June 16, 1998, and 1,000,000 shares were issued during
1999.
NOTE 7 - PRIVATE PLACEMENT MEMORANDUM
The Company pursuant to Regulation D of the Securities and Exchange Act
of 1933 conducted a private placement of $1,000,000. The offering
consists of 2,000,000 shares at $.50 per share.
NOTE 8 - SUPPLEMENTAL CASH FLOW INFORMATION
The Company acquired $34,553 of equipment subject to a capitalized lease
obligation.
<TABLE>
<CAPTION>
1999 1998
-------- --------
<S> <C> <C>
Taxes paid $ - 0 - $ - 0 -
Interest expense $ 12,064 $ - 0 -
</TABLE>
-9-
<PAGE> 34
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC.
By: /s/ Harold Solomon
----------------------------------------------------
Harold Solomon
President
By: /s/ George R. Keller Jr.
----------------------------------------------------
George R. Keller, Jr.
Director
By: /s/ Francis La Torre
----------------------------------------------------
Francis La Torre
Director
By: /s/ Anthony Caliendo
----------------------------------------------------
Anthony Caliendo
Director
By: /s/ Sam Benson
----------------------------------------------------
Sam Benson
President
Dated: December 18, 2000
-23-
<PAGE> 35
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC.
INDEX TO EXHIBITS
ITEM 1. INDEX TO EXHIBITS
See Index to Exhibits (previously filed Form 10 SB-a on January 6, 2000,
incorporated herein by reference)
ITEM 2. DESCRIPTION OF EXHIBITS
<TABLE>
<CAPTION>
Exhibit Description
No.
<S> <C>
1. STOCK EXCHANGE AND MERGER AGREEMENT BETWEEN TYROL PINES, INC. AND
Registrant (previously filed, incorporated herein by reference to
January 6, 2000 submission).
2. Articles of Merger Between Tyrol Pines, Inc. and Registrant
(previously filed, incorporated herein by reference to January 6,
2000 submission).
3. Articles of Incorporation of Registrant (f/k/a/Tyrol Pines, Inc.)
(previously filed, incorporated herein by reference to January 6,
2000 submission).
4. By-Laws of Registrant (f/k/a/Tyrol Pines, Inc.) (previously
filed, incorporated herein by reference to January 6, 2000
submission).
5. Subscription Agreements Between Global Capital Group, Inc. and
Registrant, and between Global Capital Management Group, Inc. and
Registrant (previously filed, incorporated herein by reference to
January 6, 2000 submission).
6. Consulting Agreement between Global Capital Management Group,
Inc. and Registrant (previously filed, incorporated herein by
reference to January 6, 2000 submission).
7. Subsidiaries of Registrant (previously filed, incorporated herein
by reference to January 6, 2000 submission).
8. Merger Agreement between IEMI (Nevada) and Broward Recycling
(previously filed, incorporated herein by reference to October 2,
2000 10-sb-a
</TABLE>
-24-
<PAGE> 36
<TABLE>
<S> <C>
submission)
9. Stock Transfer Ledger of Tirol Pines (previously filed,
incorporated herein by reference to October 2, 2000 10-sb-a
submission)
</TABLE>
-25-
