JONES, JENSEN & COMPANY
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Carmina Technologies Inc. and Subsidiary
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Calgary, Canada
We have audited the accompanying consolidated balance sheet of Carmina
Technologies, Inc. and Subsidiary (formerly The Americas Mining Corporation) (a
development stage company) as of December 31, 1999 and the related consolidated
statements of operations, stockholders' equity, and cash flows from inception on
May 7, 1999 to December 31, 1999. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.
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 consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated 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 consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Carmina
Technologies, Inc. and Subsidiary (formerly The Americas Mining Company)(a
development stage company) as of December 31, 1999 and the consolidated results
of their operations and their cash flows from inception on May 7, 1999 to
December 31, 1999 in conformity with generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in Note
2 to the consolidated financial statements, the Company is a development stage
company and has no operating concern. Management's plans in regard to these
matters are also described in Note 2. The consolidated financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.
/s/ Jones, Jensen & Company
Jones, Jensen & Company
Salt Lake City, Utah
April 8, 2000
<PAGE>
CARMINA TECHNOLOGIES, INC.
AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1999
<PAGE>
C O N T E N T S
Independent Auditors' Report............................................... 3
Consolidated Balance Sheet ................................................ 4
Consolidated Statement of Operations....................................... 5
Consolidated Statement of Stockholders' Equity............................. 6
Consolidated Statement of Cash Flows....................................... 7
Notes to the Consolidated Financial Statements............................. 8
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Carmina Technologies, Inc. and Subsidiary
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Calgary, Canada
We have audited the accompanying consolidated balance sheet of Carmina
Technologies, Inc. and Subsidiary (formerly The Americas Mining Corporation) (a
development stage company) as of December 31, 1999 and the related consolidated
statements of operations, stockholders' equity and cash flows from inception on
May 7, 1999 to December 31, 1999. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated 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 consolidated financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the consolidated 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 consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Carmina
Technologies, Inc. and Subsidiary (formerly The Americas Mining Company) (a
development stage company) as of December 31, 1999 and the consolidated results
of their operations and their cash flows from inception on May 7, 1999 to
December 31, 1999 in conformity with generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to the
consolidated financial statements, the Company is a development stage company
and has no operating capital which together raises substantial doubt about its
ability to continue as a going concern. Management's plans in regard to these
matters are also described in Note 2. The consolidated financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.
Jones, Jensen & Company
Salt Lake City, Utah
April 8, 2000
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Balance Sheet
December 31,
1999
------------
CURRENT ASSETS
Cash $ 3,417
Tax refund receivable 2,136
Accounts receivable 13,486
----------
Total Current Assets 19,039
----------
OTHER ASSETS
Marketable securities 13,000
----------
Total Other Assets 13,000
----------
TOTAL ASSETS $ 32,039
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts payable $ 24,189
----------
Total Current Liabilities 24,189
----------
STOCKHOLDERS' EQUITY
Common stock: 40,000,000 shares authorized
of no par, 20,502,300 shares issued and outstanding 316,649
Deficit accumulated during the development stage (308,799)
----------
Total Stockholders' Equity 7,850
----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 32,039
==========
The accompanying notes are an integral part of these consolidated financial
statements.
4
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Operations
From
Inception on
May 7,
1999 Through
December 31,
1999
------------
REVENUES $ 2,136
COST OF GOODS SOLD 1,942
-----------
GROSS PROFIT 194
-----------
EXPENSES
General and administrative 4,142
Research and development 8,346
Consulting fees 126,974
Management fees 169,445
-----------
Total Expenses 308,907
-----------
LOSS FROM OPERATIONS (308,713)
-----------
OTHER INCOME (EXPENSE)
Interest expense (86)
-----------
Total Other Income (Expense) (86)
-----------
NET LOSS $ (308,799)
===========
BASIC LOSS PER SHARE $ (0.05)
===========
The accompanying notes are an integral part of these consolidated financial
statements.
5
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Stockholders' Equity
Deficit
Accumulated
During the
Common Stock Development
---------------------- -------------
Shares Amount Stage
----------- --------- -------------
Balance, inception on May 7, 1999 -- $ -- $ --
Common stock issued for services
and cash at $0.02 per share 16,000,000 313,406 --
Common stock issued in
recapitalization 4,502,300 3,243 --
Net loss from inception on May 7, 1999
through December 31, 1999 -- -- (308,799)
----------- --------- -----------
Balance, December 31, 1999 20,502,300 $ 316,649 $ (308,799)
=========== ========= ===========
The accompanying notes are an integral part of these consolidated financial
statements.
6
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Cash Flows
<TABLE>
<CAPTION>
From
Inception on
May 7,
1999 Through
December 31,
1999
------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (308,799)
Adjustments to reconcile net loss to net cash used by operating activities:
Stock issued for services 256,117
Changes in operating assets and liabilities:
(Increase) decrease in receivables (15,622)
Increase (decrease) in accounts payable 24,189
-----------
Net Cash Used by Operating Activities (44,115)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of marketable securities (13,000)
-----------
Net Cash Used by Investing Activities (13,000)
-----------
CASH FLOWS FROM FINANCING ACTIVITIES
Cash received in recapitalization 3,243
Issuance of common stock for cash 57,289
-----------
Net Cash Provided by Financing Activities 60,532
-----------
NET INCREASE IN CASH 3,417
CASH AT BEGINNING OF PERIOD --
-----------
CASH AT END OF PERIOD $ 3,417
===========
CASH PAID FOR:
Interest $ --
Income taxes $ --
NON-CASH FINANCING ACTIVITIES
Common stock issued for services $ 256,117
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
7
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY
The consolidated financial statements presented include those of
Carmina Technologies, Inc. (formerly The Americas Mining Corporation)
(a development stage company) and its wholly-owned subsidiary Rhonda
Networks, Inc. Collectively, they are referred to herein as "the
Company."
Carmina Technologies, Inc. (Carmina) was incorporated under the laws
of the State of Utah on March 5, 1973 under the name of "Investors
Equity, Inc." In 1991, the Company changed its name to "The Americas
Mining Corporation." In January of 2000, the Company changed its name
to "Carmina Technologies, Inc."
On February 9, 2000, the Company completed an Agreement and Plan of
Reorganization whereby Carmina issued 16,000,000 shares of its common
stock in exchange for all of the outstanding common stock of Rhonda
Networks, Inc. (Rhonda).
The reorganization was accounted for as a recapitalization of Rhonda
because the shareholders of Rhonda control the Company after the
acquisition. Therefore, Rhonda is treated as the acquiring entity.
Accordingly, there was no adjustment to the carrying value of the
assets or liabilities of Carmina. Carmina is the acquiring entity for
legal purposes and Rhonda is the surviving entity for accounting
purposes.
Carmina was incorporated for the purpose of creating a vehicle to
obtain capital to seek out, investigate and acquire interests in
products and businesses which may have a potential for profit.
Rhonda, a wholly owned subsidiary, was incorporated under the laws of
the Province of Alberta, Canada on May 7, 1999. It was incorporated
for the purpose of developing and marketing its low-cost,
high-capability multipurpose communications wizard and Linux based
GateCommander and Smart-Home networking technologies. The
GateCommander 2000 technology combines firewall, virtual private
networking, network and system monitoring, e-mail and domain name
services, paging and fax with voice over IP, and dynamic web services.
The Smart-Home network management system offers homeowners control
over heating, air conditioning, lighting, appliance management,
switches and outlets, home security and motion and fire detection
zones.
a. Accounting Method
The Company's consolidated financial statements are prepared using the
accrual method of accounting. The Company has elected a calendar year
end.
b. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with
maturities of three months or less at the time of acquisition.
8
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY (Continued)
c. Basic Loss Per Share
The computation of basic loss per share of common stock is based on
the weighted average number of shares outstanding during the period of
the consolidated financial statements. Common stock equivalents,
consisting of stock warrants and options, have not been included in
the calculation as their effect is antidilutive for the period
presented.
From
Inception on
May 7,
1999 Through
December 31,
1999
------------
Numerator - loss $ (308,799)
Denominator - weighted average number of
shares outstanding 5,635,633
------------
Loss per share $ (0.05)
===========
d. Provision for Taxes
At December 31, 1999, the Company had net operating loss carryforwards
of approximately $308,000 that may be offset against future taxable
income through 2019. No tax benefit has been reported in the
consolidated financial statements, because the Company believes there
The preparation 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 disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
f. Revenue Recognition
The Company currently has no source of revenues. Revenue recognition
policies will be determined when principal operations begin.
9
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY (Continued)
g. Principles of Consolidation
The consolidated financial statements include those of Carmina
Technologies, Inc. and its wholly owned subsidiary, Rhonda Networks,
Inc. All significant intercompany accounts and transactions have been
eliminated.
NOTE 2 - GOING CONCERN
The Company's consolidated financial statements are prepared using
generally accepted accounting principles applicable to a going concern
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. However, the Company
does not have significant cash or other material assets, nor does it
have an established source of revenues sufficient to cover its
operating costs and to allow it to continue as a going concern. It is
the intent of the Company to continue in the development and marketing
of its Linux based GateCommander server appliance and its Smart-Home
technology. Additionally, the Company intends to market support
services for these products and to act as a reseller for other
products which it feels are complimentary to the Company's goals.
Until that time, shareholders of the Company have committed to meeting
its minimal operating needs.
NOTE 3 - WARRANTS AND OPTIONS
A summary of the status of the Company's warrants and options as of
December 31, 1999 and changes during the period ending December 31,
1999 is presented below:
Weighted
Average
Exercise
Warrants Options Price
-------- ------- -----
Outstanding, May 7, 1999 -- -- $ --
Granted 3,350,000 505,000 0.13
Expired -- -- --
Exercised (3,350,000) -- 0.14
----------- ----------- ---------
Outstanding, December 31, 1999 -- 505,000 $ 0.07
=========== =========== =========
Exercisable, December 31, 1999 -- 505,000 $ 0.07
=========== =========== =========
On February 9, 2000 the 505,000 options were cancelled and 1,490,000
options at $0.10 per share were issued.
10
<PAGE>
CARMINA TECHNOLOGIES, INC.
AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2000 and December 31, 1999
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Balance Sheets
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
------------- -------------
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 17,486 $ 3,417
Tax refund receivable 16,020 2,136
Accounts receivable 2,321 13,486
Prepaid expenses (Note 1) 10,320 --
------------- -------------
Total Current Assets 46,147 19,039
------------- -------------
OTHER ASSETS
Marketable securities (Note 1) 168,626 13,000
Securities receivable (net of allowance of $16,512) (Note 1) 117,646 --
------------- -------------
Total Other Assets 286,272 13,000
------------- -------------
TOTAL ASSETS $ 332,419 $ 32,039
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 32,022 $ 24,189
------------- -------------
Total Current Liabilities 32,022 24,189
------------- -------------
STOCKHOLDERS' EQUITY
Common stock: 40,000,000 shares authorized
no par value, 20,502,300 shares issued and outstanding 691,232 316,649
Deficit accumulated during the development stage (390,835) (308,799)
------------- -------------
Total Stockholders' Equity 300,397 7,850
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 332,419 $ 32,039
============= =============
</TABLE>
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
For the Three Months Ended May 7,
March 31, 1999 Through
------------------------------ March 31,
2000 1999 2000
------------- ------------- -------------
<S> <C> <C> <C>
REVENUES $ -- $ -- $ 2,136
COST OF GOODS SOLD -- -- 1,942
------------- ------------- -------------
GROSS PROFIT -- -- 194
------------- ------------- -------------
EXPENSES
General and administrative 18,568 -- 22,710
Research and development -- -- 8,346
Consulting fees 5,778 -- 132,752
Management fees 37,188 -- 206,683
------------- ------------- -------------
Total Expenses 61,534 -- 370,441
------------- ------------- -------------
LOSS FROM OPERATIONS (61,534) -- (370,247)
------------- ------------- -------------
OTHER INCOME (EXPENSE)
Gain on sale of investments (Note 1) 3,165 -- 3,165
Unrealized loss on investments (Note 1) (23,667) -- (23,667)
Interest expense -- -- (86)
------------- ------------- -------------
Total Other Income (Expense) (20,502) -- (20,588)
------------- ------------- -------------
NET LOSS $ (82,036) $ -- $ (390,835)
============= ============= =============
BASIC LOSS PER SHARE $ (0.00) $ 0.00
============= =============
</TABLE>
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Stockholders' Equity
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock During the
----------------------------- Development
Shares Amount Stage
------------- ------------- -------------
<S> <C> <C> <C>
Balance, inception on May 7, 1999 -- $ -- $ --
Common stock issued for services
and cash at $0.02 per share 16,000,000 313,406 --
Common stock issued in
recapitalization 4,502,300 3,243 --
Net loss from inception on May 7, 1999
through December 31, 1999 -- -- (308,799)
------------- ------------- -------------
Balance, December 31, 1999 20,502,300 316,649 (308,799)
Contributed capital (unaudited) -- 374,583 --
Net loss for the three months ended
March 31, 2000 (unaudited) -- -- (82,036)
------------- ------------- -------------
Balance, March 31, 2000 20,502,300 $ 691,232 $ (390,835)
============= ============= =============
</TABLE>
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Consolidated Statement of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
For the Three Months Ended May 7,
March 31, 1999 Through
---------------------------- March 31,
2000 1999 2000
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (82,036) $ -- $ (390,835)
Adjustments to reconcile net loss to net cash
used by operating activities:
Stock issued for services -- -- 256,117
Non-cash change in securities 20,502 -- 20,502
Changes in operating assets and liabilities:
(Increase) decrease in receivables (2,719) -- (18,341)
(Increase) decrease in prepaid expenses (10,320) -- (10,320)
Increase (decrease) in accounts payable 7,832 -- 32,021
------------ ------------ ------------
Net Cash Used by Operating Activities (66,741) -- (110,856)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of securities 8,971 -- 8,971
Purchase of marketable securities (302,745) -- (315,745)
------------ ------------ ------------
Net Cash Used by Investing Activities (293,774) -- (306,774)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Cash received in recapitalization -- -- 3,243
Issuance of common stock for cash -- -- 57,289
Contributed capital 374,584 -- 374,584
------------ ------------ ------------
Net Cash Provided by Financing Activities 374,584 -- 435,116
------------ ------------ ------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 14,069 -- 17,486
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 3,417 -- --
------------ ------------ ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 17,486 $ -- $ 17,486
============ ============ ============
CASH PAID FOR:
Interest $ -- $ -- $ --
Income taxes $ -- $ -- $ --
NON-CASH FINANCING ACTIVITIES
Common stock issued for services $ -- $ -- $ 256,117
</TABLE>
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 2000 and December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY
The consolidated financial statements presented include those of
Carmina Technologies, Inc. (formerly The Americas Mining Corporation)
(a development stage company) and its wholly-owned subsidiary Rhonda
Networks, Inc. Collectively, they are referred to herein as "the
Company."
Carmina Technologies, Inc. (Carmina) was incorporated under the laws
of the State of Utah on March 5, 1973 under the name of "Investors
Equity, Inc." In 1991, the Company changed its name to "The Americas
Mining Corporation." In January of 2000, the Company changed its name
to "Carmina Technologies, Inc."
On February 9, 2000, the Company completed an Agreement and Plan of
Reorganization whereby Carmina issued 16,000,000 shares of its common
stock in exchange for all of the outstanding common stock of Rhonda
Networks, Inc. (Rhonda).
The reorganization was accounted for as a recapitalization of Rhonda
because the shareholders of Rhonda control the Company after the
acquisition. Therefore, Rhonda is treated as the acquiring entity.
Accordingly, there was no adjustment to the carrying value of the
assets or liabilities of Carmina. Carmina is the acquiring entity for
legal purposes and Rhonda is the surviving entity for accounting
purposes.
Carmina was incorporated for the purpose of creating a vehicle to
obtain capital to seek out, investigate and acquire interests in
products and businesses which may have a potential for profit.
Rhonda, a wholly owned subsidiary, was incorporated under the laws of
the Province of Alberta, Canada on May 7, 1999. It was incorporated
for the purpose of developing and marketing its low-cost,
high-capability multipurpose communications wizard and Linux based
GateCommander and Smart-Home networking technologies. The
GateCommander 2000 technology combines firewall, virtual private
networking, network and system monitoring, e-mail and domain name
services, paging and fax with voice over IP, and dynamic web services.
The Smart-Home network management system offers homeowners control
over heating, air conditioning, lighting, appliance management,
switches and outlets, home security and motion and fire detection
zones.
a. Accounting Method
The Company's consolidated financial statements are prepared using the
accrual method of accounting. The Company has elected a calendar year
end.
b. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with
maturities of three months or less at the time of acquisition.
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 2000 and December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY (Continued)
c. Basic Loss Per Share
The computation of basic loss per share of common stock is based on
the weighted average number of shares outstanding during the period of
the consolidated financial statements. Common stock equivalents,
consisting of stock warrants and options, have not been included in
the calculation as their effect is antidilutive for the period
presented.
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
----------------------------
2000 1999
------------ ------------
<S> <C> <C>
Numerator - loss $ (82,036) $ --
Denominator - weighted average number of
shares outstanding 20,502,300 --
------------ ------------
Loss per share $ (0.00) $ (0.00)
============ ============
</TABLE>
d. Provision for Taxes
At March 31, 2000, the Company had net operating loss carryforwards of
approximately $390,000 that may be offset against future taxable
income through 2019. No tax benefit has been reported in the
consolidated financial statements, because the Company believes there
is a 50% or greater chance the carryforwards will expire unused.
Accordingly, the potential tax benefits of the loss carryforwards are
offset by a valuation account of the same amount.
e. Estimates
The preparation 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 disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
f. Revenue Recognition
The Company currently has no source of revenues. Revenue recognition
policies will be determined when principal operations begin.
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly The Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 2000 and December 31, 1999
NOTE 1 - ORGANIZATION AND HISTORY (Continued)
g. Principles of Consolidation
The consolidated financial statements include those of Carmina
Technologies, Inc. and its wholly owned subsidiary, Rhonda Networks,
Inc. All significant intercompany accounts and transactions have been
eliminated.
h. Unaudited Financial Statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for a
fair presentation. Such adjustments are of a normal recurring nature.
i. Prepaid Expenses
During the three months ended March 31, 2000, the Company prepaid
$10,320 to Falter Engineering for services to be provided in future
periods.
j. Securities Receivable
The Company purchased 750,000 shares of Qnetix, Inc's common stock
during the three months ended March 31, 2000. At the time of purchase,
450,000 shares of stock were delivered to the Company which have been
deposited into a brokerage account and are classified as trading. The
remaining 300,000 shares, with a value of $117,646 at March 31, 2000
will be delivered in March 2001. These shares are valued at the lower
of cost or market
k. Marketable Securities
The fair value of the Company's marketable securities is estimated
based on quoted market prices for those investments. During the three
months ended March 31, 2000, the Company sold a portion of the trading
securities for a gain of $3,165. The Company recorded an unrealized
loss of $23,667 to account for the decline in value of the remaining
securities. The fair value of the Company's marketable securities at
March 31, 2000 was $168,626.
NOTE 2 - GOING CONCERN
The Company's consolidated financial statements are prepared using
generally accepted accounting principles applicable to a going concern
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. However, the Company
does not have significant cash or other material assets, nor does it
have an established source of revenues sufficient to cover its
operating costs and to allow it to continue as a going concern. It is
the intent of the Company to continue in the development and marketing
of its Linux based GateCommander server appliance and its Smart-Home
technology. Additionally, the Company intends to market support
services for these products and to act as a reseller for other
products which it feels are complimentary to the Company's goals.
Until that time, shareholders of the Company have committed to meeting
its minimal operating needs.
<PAGE>
CARMINA TECHNOLOGIES, INC. AND SUBSIDIARY
(Formerly the Americas Mining Corporation)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 2000 and December 31, 1999
NOTE 3 - WARRANTS AND OPTIONS
A summary of the status of the Company's warrants and options as of
March 31, 2000 and changes during the period ending March 31, 2000 is
presented below:
Exercise
Options Price
---------- ----------
Outstanding, December 31, 1999 505,000 $ 0.07
Granted 1,490,000 0.10
Expired -- --
Canceled (505,000) 0.07
Exercised -- --
---------- ----------
Outstanding, March 31, 2000 1,490,000 $ 0.10
========== ==========
Exercisable, March 31, 2000 1,490,000 $ 0.10
========== ==========
