SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-SB/A
Amendment No. 1
General Form for Registration of Securities of
Small Business Issuers Under Section 12(b) or (g) of
The Securities Exchange Act of 1934
FOURTHCAI, INC.
-------------------------------
(Name of Small Business Issuer)
NEVADA 86-0979534
-------------- ---------------------
(State of (I.R.S. Employer
Incorporation) Identification Number)
10245 East Via Linda, Scottsdale, Arizona 85258
-----------------------------------------------------------
(Address of Principal Executive Offices Including Zip Code)
(480) 421 2882
--------------------------
(Issuers Telephone Number)
Securities to be registered pursuant to Section 12(b) of the Act: NONE
Securities to be registered pursuant to Section 12(g) of the Act:
COMMON STOCK
$.0001 par value
(Title of Class)
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PART I
ITEM 1. BUSINESS
Fourthcai, Inc., was incorporated in The State of Nevada on September 3,
1999. Its purpose is to engage in any lawful corporate activity, which includes
mergers and acquisitions. The issuer is in a development stage and has no
operations to date other than issuing of shares to the original shareholders. It
was formed to provide a method for a private domestic or foreign company to
become a public reporting company thereby causing their shares to be qualified
to trade in the domestic secondary markets.
There have been no bankruptcy, receivership or similar proceeding in the
Company's history.
There has been no material reclassification or merger in the Company's
short history.
The issuer will attempt to locate another business for the purpose of
merging that company into the issuer. It is possible that the company will
become a wholly owned subsidiary of the issuer or it may sell or transfer assets
into the issuer and not merge. The issuer is not able to know if it will be
successful in locating and merging with or acquiring another entity.
There are certain benefits to being a reporting company with a publicly
traded class of stock. They are perceived as follows:
* increased ability to raise capital
* enhanced visibility in the financial community particularly helpful to
raise debt if needed
* presence in the capital markets of the United States
* ability to use registered securities to acquire other companies and or
their assets
* improved competitive position
* increased corporate prestige
* key employees compensation through stock options
* shareholder liquidity and corporate valuation
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An entity may be interested in merging with the issuer if it is interested
in using public securities to make acquisitions of other companies or one that
is interested in becoming public without substantial dilution of its stock.
Other targeted companies may be those which have not been able to locate an
underwriter with acceptable terms; one that feels it can raise capital on more
favorable terms as a public entity or a foreign company seeking entry into the
United States stock markets.
The Company's business has numerous associated risks such as; competition,
no operating history, lack of any agreements with possible targeted companies,
management control, lack of market research, stock dilution, taxation, target
company's need for audited financial, conflicts of interest (this issue is
discussed in ITEM 5) and possible computer problems.
The business of seeking mergers with other companies or acquiring other
companies is highly competitive. There are many large corporations and venture
capital firms that seek other entities with which to merge or acquire. These
corporations and venture capital firms are better financed than the issuer and
have more expertise in the field of mergers and acquisitions. The issuer will
not be a significant competitor in this field.
The issuer is without operating history. It has no revenue and limited
assets. The Company will in all likelihood operate at a loss and will be unable
to reverse that situation until a merger or acquisition occurs. There is no
targeted company nor any assurance the company will be able to close a business
transaction needed to reverse its anticipated losses.
The issuer has no current agreement with respect to a merger or acquisition
with a targeted company. There is no assurance that the Company will be
successful in its plan to merge or acquire another entity. There has been no
industry identification by management nor has there been a business model
established consisting of the required operating history, assets and revenues of
a target company. Therefore, the issuer may enter into an agreement which may
result in a business combination with an entity without significant operating
history, revenues or assets precluding the potential for current earnings or
increased net worth.
The management of the issuer consists of its only officer. He will devote a
portion of his time to the business of the Company attempting to locate and
close with a potential targeted company. There is neither compensation paid nor
an agreement to enter into such a contract in the future. The loss of this
individual could adversely affect the Company's development and its continued
operations.
The Company has performed limited research in an attempt to determine
whether demand exists for these types of transactions. Even if further research
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determines that the demand does in fact exist, there is no assurance that the
issuer will be able to conclude a transaction.
The successful conclusion of an acquisition or merger by the issuer will
probably result in the issuance of securities to the shareholders of the
targeted company. This transaction will cause, in all probability, the
shareholders of the targeted company gaining control of the issuer and a change
in the existing management. It is the intention of the issuer to structure a
transaction with a targeted company to minimize the state and federal tax
consequences as they apply to both parties. There can be no assurance that all
the statutory requirements can be met in the proposed reorganization or that the
parties will receive tax benefits desired in a transfer of stock or assets.
The issuer will seek those companies, which have audited financial
statements or assure the issuer that said statements will be furnished within
sixty days of closing. If audited financial statements are not available at
closing, the issuer will require representations that the statements, when
audited, will not materially differ from the unaudited statements presented.
There are no assurances that a viable candidate for merger will agree with the
issuer's request, which would result in the failure of the transaction to close.
The issuer will require that the targeted company be computer compliant for
the year 2000. If the target is not compliant it will be necessary to disclose
what steps it intends to take in order to eliminate any business disruption
created by noncompliance. There can be no assurance that the company will not
close a transaction with a company that has not or is unable to correct the year
2000 computer problems. The impact of said transaction could be very difficult
to ascertain.
The issuer does not believe it could be subject to regulation under the
Investment Company Act, because it will not be engaged in the business of
investing or trading securities. However, if the Company engages in operations
which result in it holding passive investments in more than one other company,
in could be subject to the regulations found in the Investment Company Act of
1940 and it would have to register under said act which could result in
significant registration and compliance costs.
The issuer has no full time employees. The president of the Company will
devote a portion of his time to the activities of the issuer without
compensation.
The Company will send an annual report to its security holders, which shall
contain audited financial statements. The issuer is electronically filing this
Registration Statement with the Securities Exchange Commission, without an
obligation to do so under the Securities Act of 1934, to comply with the
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reporting requirements as promulgated by the commission. As such, the Company
will advise the shareholders that the SEC maintains an Internet site that
contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC at http://www.sec.gov.
ITEM 2. MANAGEMENT'S PLAN OF OPERATION
During the next twelve months the issuer intends to locate, analyze,
acquire or merge with a targeted company. At this time, the issuer has no
company in mind. There has been no negotiation with any company neither on
behalf of the issuer nor by any officer, director or agent of the issuer
regarding any type of acquisition or merger. The issuer will solicit targeted
companies through the utilization of contacts in business and professional
communities. The issuer intends to solicit directly or may engage consultants or
advisors to assist it in reaching its objective. Payment will be made to these
consultants and advisors if a successful acquisition or merger occurs because of
their efforts. The payment may consist of cash or some stock in the surviving
entity or a combination of both.
The satisfaction of the issuer's cash requirements for the next twelve
months will be met in that Corporate Architects, Inc., the issuer's principal
shareholder, has agreed to advance to the Company the additional funds needed
for operations and those amounts designated for costs associated with a search
for and completion of an acquisition. The principal shareholder has no
expectation of reimbursement of the funds advanced unless the new owners of the
Company decide to pay all or a portion thereof. A limit as to the minimum or
maximum amounts advanced by the principal shareholder has not been set. The
issuer will not borrow funds to pay management, agents, consultants, advisors or
promoters. The Company will not merge with, acquire or purchase assets of an
entity in which the Company's officers, directors or shareholders or any
affiliate or agent hold an equity position or is an officer or director.
The Company's business plan is to locate certain companies that may wish to
merge with the issuer in some fashion. This targeted company would desire the
perceived advantages of a merger with a public, reporting company. The perceived
advantages may enhance the company's ability to attract investment, utilize
securities for acquisition, provide liquidity and numerous other benefits. No
particular industry has been identified nor is this search confined to a
specific geographical area. It is not anticipated by management that the Company
will be able to participate in any more than one merger because of its limited
assets and resources.
The issuer may merge or acquire a company in early stage development
needing additional capital to launch new products, increase marketing or improve
quality. The utilization of the public market may be beneficial in raising the
required capital.
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The issuer does not have nor will it acquire capital to supply targeted
companies. It is the position of management that it can present to the candidate
the opportunity to acquire controlling interest in a public company without the
substantial costs, both in time and money, of an initial public offering.
Management has performed only limited research in this area.
The officer and director of the issuer will undertake the responsibility of
finding and analyzing new business opportunities. He will perform this task
individually and possibly with the help of other consultants and agents. The
agents or consultants will not receive a cash fee from the issuer said fee will
have to be assumed by the target company. The officer is experienced in the
analysis of companies and will be able to determine the existence of the primary
requirements of a good business structure consisting of financial, management,
products, distribution, need for further research and development, growth
potential and other material requirements. The issuer will have total discretion
in determining the type of company best suited for a business combination.
The issuer will be subject to all the reporting requirements of the
Securities Exchange Act. Said Act requires, among other things, that a reporting
company file its audited financial statements. The issuer will not merge or
acquire a company that does not have or will not have audited financials within
a reasonable period of time, to meet the requirements of the Exchange Act. If
the merger candidate is unable to produce audited financial statements within
sixty days from the filing of the 8 K announcing the consummation of the merger
or said financial statements fail to comply with the Exchange Act, the closing
documents will provide for the dissolution of the transaction.
A target company may want to establish a public trading market for its
securities. It may desire to avoid what it perceives to be an adverse
consequence of undertaking its own public offering. It is possible to meet this
objective by entering into a transaction with the issuer. The adverse
consequences may be perceived to be, loss of control, substantial expense and
loss of time attempting to conclude an underwriting or the inability to retain
an underwriter with acceptable terms
A business candidate may have pre-existing agreements with outside
advisors, attorneys and accountants and the continuation of those agreements may
be required before the candidate will agree to close a transaction with the
issuer. These existing agreements may be a factor in the determination by the
issuer to go forward.
The conclusion of a business transaction will most likely result in the
present shareholders no longer being in control of the issuer. Management of the
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issuer probably will not have the expertise in the business of the new entity,
which will result in the resignation of the present management.
The acquisition or merger usually results in the issuance of restricted
securities as consideration. If the negotiations resulted in the requirement for
registered securities to be issued, the surviving company would have to bear the
burden of registering the shares. There can be no assurance that that these
newly registered shares would be sold into the market depressing the market
value.
A merger with another company will significantly dilute the percentage of
ownership the present shareholders now enjoy. The amount of dilution will depend
on the number of shares issued which in term could depend on the assets and
liabilities of the merging company. This is not to say that other factors may
not enter into this determination.
ITEM 3. DESCRIPTION OF PROPERTY
The issuer is currently housed in the offices of its principal shareholder,
Corporate Architects, Inc. at 4300 N. Miller Road Suite 120, Scottsdale, Arizona
85251-3620. No rent is being charged to the issuer and the issuer may remain at
this address until a merger is concluded. The Company owns no real property and
has no plans to acquire real property.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth each person known by the Company to be the
beneficial owner of more than 5% of the Common Shares (the only class of voting
securities) of the Company all directors individually and all directors and
officers of the Company as a group. Each person has sole voting and investment
power with respect to the shares as indicated.
Name and Address Amount of Beneficial Percentage
of Beneficial Owner Ownership of Class
------------------- --------- --------
Corporate Architects, Inc.(1) 5,000,000 99.2%
4300 N. Miller Rd Suite 120
Scottsdale, AZ 85251-3620
All Executive Officers and 5,000,000 99.2%
Directors as a Group (1 person)
- ----------
(1) Mr. Edmond L. Lonergan owns 100% of the issued and outstanding shares of
Corporate Architects, Inc. and is its sole officer and director. As such,
Mr. Lonergan is the beneficial owner of the common stock of the issuer and
is the only control shareholder.
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ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The issuer has one officer and director.
Name Age Positions and Offices Held
---- --- --------------------------
Edmond L. Lonergan 54 President Secretary and Director
There are no agreements that a Director will resign at the request of
another person and the above named Director is not acting on behalf of nor will
act on behalf of another person.
The following is a brief summary of the Director, and Officer including his
business experiences for the past five years.
Edmond L. Lonergan from 1968 to 1996 has founded numerous high tech
corporations one of which became public. It was honored by Inc. Magazine for
becoming the 28th fastest growing company in 1992. Previously, he held the
positions of Board Chairman, President, CEO, Vice President of Sales and
Marketing, Vice President of Operations, Vice President of Finance, Director of
Research, Operating Manager, Manager of Software Development and Product
Development Consultant. Mr. Lonergan was also selected to be a member of the
White House Small Business Committee during the Carter Administration.
Mr. Lonergan founded Corporate Architects, Inc. in 1997. The company
specializes in consulting and advising businesses in the area of strategic
planning as well as mergers and acquisitions.
CURRENT BLANK CHECK COMPANY
Mr. Lonergan is the majority shareholder, through his ownership of
Corporate Architects, and sole officer and director of Firstcai, Inc. which has
filed a registration statement on Form 10-SB. That registration statement will
go effective automatically 60 days after the filing date of November 1, 1999.
The initial business purpose of Firstcai, Inc. is to engage in mergers and
acquisitions with an unidentified company. It is a blank check company and will
remain so until such time that it completes an acceptable business transaction.
He is also sole officer and director of Thirdcai as well as the majority
shareholder through his ownership of Corporate Architects. Thirdcai filed its
registration statement on Form 10-SB and it has been advised by the Securities
Exchange Commission that the registration will become effective 60 days after
its filing date of February 4, 2000.
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Mr. Lonergan expects to be involved with other blank check companies with
similar objectives. There are potential conflicts of interest which may occur if
the officer and director holds a similar position with other blank check
companies with the same objectives. The sole officer and director intends to
locate merger candidates for the companies. To date, there have been no mergers
with the "blank check" companies registered by Corporate Architects.
ITEM 6. EXECUTIVE COMPENSATION
The issuer's officer and director does not and has not receive compensation
for services rendered to the issuer nor has any compensation been accrued. He
will not participate in any finders' fees however; he will receive some benefits
as a beneficial owner of the issuer upon a merger or acquisition taking place.
Furthermore, there are no stock option plans, pension plans, insurance coverage
or other benefit programs adopted by the issuer.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There are no parents of this small business issuer.
There are and have been no transactions with promoters.
There were no material underwriting discounts and commissions upon the sale
of securities by the issuer where any of the specified persons was or is to be a
principal underwriter or is a controlling person or member of a firm that was or
is to be a principal underwriter.
There were no transactions involving the purchase or sale of assets other
than in the ordinary course of business.
ITEM 8. DESCRIPTION OF SECURITIES
The authorized capital stock of the issuer consists of 100,000,000 shares
of Common Stock, par value $.0001 per share. There is no authorized Preferred
Stock. The material terms of the capital stock of the issuer are set forth in
the following statements. However, reference is made to the more detailed
statements as found in the Company's Articles of Incorporation with amendments
and the Company Bylaws all of which are attached to this registration statement
as exhibits.
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COMMON STOCK
Holders of common stock are entitled to one vote per each share standing in
his/her name on the books of the Company as to those matters properly before the
shareholders. There are no cumulative voting rights and simple majority
controls. The holders of common stock will share ratably in dividends, if any,
as declared by the Board of Directors in its discretion from funds or stock
legally available. Common stock holders are entitled to share pro-rata on all
net assets, in the event of dissolution. All of the shares of common stock are
fully paid and non-assessable.
The issuer is not offering preferred stock with this registration statement
nor is it offering debt securities.
There are no provisions in the Articles of Incorporation or the Bylaws that
would delay, defer or prevent a change of control. However, any future issuance
of preferred stock could have the effect of delaying or preventing a change in
control of the Company without further action by the shareholders and could
adversely affect the voting or other rights of the holders of common stock.
The business activity of the issuer is that of a blank check company as
defined in Section 7 (b) (3) of the Securities Act of 1933. A "blank check"
company is a company that: (i) is a development stage company without a specific
business plan or purpose or has indicated that its purpose is to engage in a
merger or acquisition with an unidentified company or companies or other entity
or person and (ii) is issuing "penny stock" as defined in Rule 3a51 - 1 under
the Securities Exchange Act of 1934. Penny Stock is an equity security other
than a security; (a) that is a reported security; (b) that is issued by an
investment company registered under the Investment Company Act of 1940; (c) that
is a put or call by the Option Clearing Corporation; (d) except for purposes of
section 7(d) of the Securities Act and Rule 419 that has a price of $5.00 or
more; (e) that is registered, or approved for registration upon notice of
issuance, on a national exchange; (f) that is authorized for, or approved for
authorization upon notice of issuance, for quotation on NASDAQ, except that a
security that satisfies the requirements of this paragraph, but that does not
otherwise satisfy the requirements of paragraphs (a), (b), (c) or (d) of this
section 3(a) 51-1, shall be a penny stock for purposes of section 15(b)(6) of
the Exchange Act; or (g) is issued by an issuer who has net tangible assets in
excess of $2,000,000 if it has been in continuos operation for at least three
years, $5,000,000 is in continuos operation for less than three years; or
average revenue of at least $6,000,000 for the last three years.
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PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON REGISTRANTS COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
MARKET INFORMATION
There is no public trading market for the common equity and there has been
no trading to date. Furthermore, there is no assurance that a public trading
market will ever be established.
The issuer's securities meet the definition of "penny stock" as found in
Rule 3a51-1 of the Securities Exchange Act of 1934. The Securities and Exchange
Commission has adopted Rule 15g-9 which established sales practice requirements
for certain low price securities ("penny stock"). Unless the transaction is
exempt, it shall be unlawful for a broker or dealer to sell a penny stock to, or
to effect the purchase of a penny stock by, any person unless prior to the
transaction: (i) The broker or dealer has approved the person's account for
transactions in penny stocks pursuant to this rule and (ii) the broker or dealer
has received from the person 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 stock the broker or dealer
must: (a) obtain from the person information concerning the person's financial
situation, investment experience, and investment objectives; (b) reasonably
determine that transactions in penny stocks are suitable for that person, and
that the person has sufficient knowledge and experience in financial matters
that the person reasonably may be expected to be capable of evaluating the risks
of transactions in penny stocks; (c) deliver to the person a written statement
setting forth the basis on which the broker or dealer made the determination (i)
stating in a highlighted format that it is unlawful for the broker or dealer to
affect a transaction in penny stock unless the broker or dealer has received,
prior to the transaction, a written agreement to the transaction from the
person; and (ii) stating in a highlighted format immediately preceding the
customer signature line that (iii) the broker or dealer is required to provide
the person with the written statement; and (iv) the person should not sign and
return the written statement to the broker or dealer if it does not accurately
reflect the person's financial situation, investment experience, and investment
objectives; and (d) receive from the person a manually signed and dated copy of
the written statement. It is also required that disclosure be made as to the
risks of investing in penny stocks and the commissions payable to the broker-
dealer, as well as current price quotations and the remedies and rights
available in cases of fraud in penny stock transactions. Statements, on a
monthly basis must be sent to the investor listing recent prices for the penny
stock and information on the limited market.
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It is the issuer's intention to merge or acquire a company, which would
qualify it to be listed on the NASDAQ SmallCap Market. The initial listing
requirements are as follows: (1) net tangible assets of $4,000,000 or market
capitalization of $50,000,000 or net income in latest fiscal year or two of the
last three fiscal years of $750,000, (2) public float 1,000,000 shares with a
market value of $5,000,000, (3) minimum bid price of $4.00, (4) three market
makers, (5) 300 round lot (100 or more shares) shareholders, (6) an operating
history of one year or $50,000,000 market cap, and (7) corporate governance
standards must be in place. Subsequent to qualifying for listing the company, in
order to remain on the SmallCap Market, the company must maintain the following;
(1) net tangible assets of $2,000,000 or market capitalization of $35,000,000 or
net income in latest fiscal year or two of the last three fiscal years of
$500,000, (2) public float 500,000 shares with a market value of $1,000,000, (3)
minimum bid price of $1.00, (4) two market makers, (5) 300 round lot (100 or
more shares) shareholders, and (6) corporate governance standards must be in
place.
The company may not qualify for the SmallCap market after a merger or
acquisition. In that case it's securities may be traded on the Over The Counter
Bulletin Board (OTCBB). This exchange differs from NASDAQ in that the
qualifications do not include minimum assets, revenues, number of shareholders,
market capitalization, number of shares in the public float and corporate
governance standards. To qualify for OTCBB the company must have a market maker
willing to list the securities on a bid and ask quotation and sponsor the
company for listing. All companies, including banks and insurance companies,
traded on the OTCBB must be fully reporting as of June 2000. The company may
also offer its securities on the National Quotation Bureau, Inc., commonly known
as the "pink sheets".
It is the company's objective to become qualified for NASDAQ SmallCap
however; there is no assurance it will reach or maintain that objective. The
issuer may, after a merger or acquisition, commence trading on the OTC BB.
(a) Holders. There are three (3) holders of the common equity of the
Company.
(b) Dividends. There have been no cash dividends declared to date and
there are no plans to do so. There are no restrictions that limit the
ability to pay dividends on common equity other than the dependency on
the Company's revenues, earnings and financial condition.
ITEM 2. LEGAL PROCEEDINGS
The issuer is not a party to any pending legal proceeding nor is its
property the subject of any legal proceeding.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
The Company has had no disagreements with its accountants nor has the
Company changed accountants.
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ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
The Company has sold the following securities, which were not registered
during the past three years.
Number
Date Name of Shares Consideration
- ---- ---- --------- -------------
September 3,1999 Corporate Architects, Inc (1) 5,000.000 $1,000.00
September 3, 1999 Carl P. Ranno (2) 10,000 Legal Services
September 23, 1999 Kenneth R. Lew (3) 30,000 $600.00
- ----------
(1) Mr. Edmond Lonergan is the president and sole director of the issuer and is
also the sole shareholder and director of Corporate Architects, Inc.
accordingly; Mr. Lonergan is the beneficial owner of the common securities
issued to Corporate Architects, Inc.
(2) Mr. Ranno elected to accept common securities as a portion of his fees for
legal services rendered to the issuer.
(3) Mr. Lew is not an officer, director or beneficial owner of Corporate
Architects, Inc. however, he is a consultant to the firm.
There have been no underwriting undertaken by the issuer.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to the Nevada Revised Statutes sec. 78.751, a Nevada Corporation
has the power to indemnify its Directors, Officers, Employees and Agents.
Pursuant to Article 12 of the issuers Articles of Incorporation, the Company
shall indemnify its Officers, Directors, Employees and Agents. Article V of the
issuer's Bylaws specifically sets forth the Indemnification of those above
stated. Pursuant to the above the Directors and Officers liability is affected.
A copy of the Articles and Bylaws are attached as exhibits and more fully sets
forth the subject of this Item.
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PART F/S
Attached are the audited financial statements of the issuer since its
inception.
Table of Contents
Issuer Financial Statements and Independent Auditors' Reports
a) Balance Sheets
b) Notes to Financial Statements
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Report of Independent Accountants
To the Board of Directors
FourthCAI, Inc.
Scottsdale, Arizona
We have audited the accompanying balance sheet of FourthCAI, Inc. as of March
31, 2000, and the related statements of operations, stockholders' equity and
cash flows for the period then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above presents fairly, in
all material respects, the financial position of FourthCAI, Inc. as of March 31,
2000, and the results of its operations and its cash flows for the period then
ended in conformity with generally accepted accounting principles.
James C. Marshall, CPA, PC
Scottsdale, Arizona
April 4, 2000
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FOURTHCAI, INC.
BALANCE SHEET
MARCH 31, 2000
ASSETS
March 31, 2000
--------
Current Assets
Cash and cash equivalents $ 900
--------
Current Assets 900
--------
Organization costs, net of amortization (Note 2) 442
--------
Total Assets $ 1,342
========
LIABILITIES AND STOCKHOLDERS' EQUITY
Stockholders' Equity
Common Stock - $0.0001 par value, authorized
100,000,000 shares, issued and outstanding 5,040,000 $ 504
Additional paid in capital 1,596
Retained Earnings (Deficit) (758)
--------
Total Stockholders' Equity 1,342
--------
Total Liabilities and Stockholders' Equity $ 1,342
========
The accompanying notes are an integral part of these financial statements.
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FOURTHCAI, INC.
STATEMENT OF OPERATIONS
FOR THE SEVEN MONTHS ENDED MARCH 31, 2000
Revenue $ --
Expenses
Administrative costs 700
Amortization of organization costs 58
----------
Net Income/(Loss) $ 758
==========
Loss per common share $ 0.00
==========
Weighted average shares outstanding 5,040,000
==========
The accompanying notes are an integral part of these financial statements.
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FOURTHCAI, INC.
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE SEVEN MONTHS ENDED MARCH 31, 2000
Common Stock
----------------- Paid in Retained
Shares Amount Capital Earnings Total
--------- ----- ------- ------- -------
Balance at September 3, 1999
date of incorporation 5,040,000 $ 504 $ 1,596 $ 2,100
Net Income/(Loss) $ (758) (758)
---------- ----- ------- ------- -------
Balance at March 31, 2000 5,040,000 $ 504 $ 1,596 $ (758) $ 1,342
========== ===== ======= ======= =======
The accompanying notes are an integral part of these financial statements.
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FOURTHCAI, INC.
STATEMENT OF CASH FLOWS
FOR THE SEVEN MONTHS ENDED MARCH 31, 2000
Loss from operations $ (758)
Adjustments to reconcile los from operations to net
cash provided by (from) operating activities:
Amortization of organization costs 58
-------
Net cash (used) by operations (700)
-------
Net cash (used) by operating activities (700)
-------
Proceeds from issuance of stock 1,600
-------
Net cash provided by financing activities 1,600
-------
Net increase in cash and cash equivalents 900
Cash and cash equivalents at beginning of period --
-------
Cash and cash equivalents at end of period $ 900
=======
The accompanying notes are an integral part of these financial statements.
19
<PAGE>
FOURTHCAI, INC.
NOTES TO FINANCIAL STATEMENT
FOR THE PERIOD ENDED MARCH 31, 2000
NOTE 1 - THE COMPANY
FourthCAI, Inc. (the "Company") was incorporated in the state of Nevada on
September 3, 1999. The Company has had no operations since incorporation,
however, has incurred certain costs related to organization and administration.
Legal services were provided to the Company in exchange for stock of the
Company. This transaction was based on the out-of-pocket costs for the provider
and recorded by the Company as $500. These organization costs have been
capitalized and are being amortized over 60 months. Administrative costs
allocated to Company for the seven months ended March 31, 2000 were $700.
NOTE 2 - STOCKHOLDERS' EQUITY
The Company has 100,000,000 shares of $0.0001 par value stock authorized and
5,040,000 shares outstanding at March 31, 2000.
20
<PAGE>
PART III
ITEM 1. INDEX TO EXHIBITS
Exhibit Number Description
-------------- -----------
(3)
(i) Articles of Incorporation(1)
(ii) By-Laws(1)
(4) Instruments Defining the Rights of Holders
(i) Lock-Up Agreement with Corporate Architects(1)
(ii) Lock-Up Agreement with Carl P. Ranno(1)
(iii) Lock-Up Agreement with Kenneth R. Lew(1)
(23) Consent of Accountant*
(27) Financial Data Schedule*
- ----------
(1) Previously filed
* Filed herewith
21
<PAGE>
SIGNATURE
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by the
undersigned thereunto duly authorized.
FOURTHCAI, INC.
April 20, 2000 By: /s/ Edmund L. Lonergan
------------------------------------
Director and President
22
[JAMES C. MARSHALL, CPA, PC LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion of our audit of the balance sheet of FourthCAI, Inc.
as of March 31, 2000 as part of this Form 10-SB.
/s/ James C. Marshall, CPA, PC
Scottsdale, Arizona
April 4, 2000
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