UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 10-KSB
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File No. 0-14047
Cardinal Industries, Inc.
(Formerly National Thoroughbred Corporation)
(Exact name of Registrant as specified in its charter)
MASSACHUSETTS 04-2392188
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
6975 South Union Park Center #600, Salt Lake City, Utah 84047
(Address and zip code of principal executive offices)
Registrant's telephone number, including area code: (801) 256-9600
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: NONE
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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. [ X ] Yes [ ] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [ ]
Revenue for the year ended December 31, 1998: $ 0.
As of September 20, 1999 it is unclear as to the aggregate market value of the
voting stock held by non-affiliates of the Registrant. This is due to the low
or almost non-existing trading of the Registrant's Securities.
As of September 20, 1999 the number of shares outstanding of the Registrant's
Common Stock was 5,798,697.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
Cardinal Industries, Inc. ("the Company")was organized in February
1966 in the Commonwealth of Massachussetts under the name "Sanson Institute of
Heralding,Inc." Subsequently, the name was changed to "Cardinal Industries,
Inc." and the Company's domicile is in the process of being changed to Nevada.
Although originally formed to engage in the distribution of millwork products
and industrial and fluid power supplies, the company's management anticipates
merging with an as yet unidentified on-going business in the future.
The Company is currently seeking a business opportunity merge with or
acquire, but to date has not located in any such business opportunities.
There is no assurance that the Company will be successful in finding any
business opportunity to merge with or acquire.
ITEM 2. DESCRIPTION OF PROPERTY
The Company currently operates from the office of the Company's
President and pays no rent or expenses.
ITEM 3. LEGAL PROCEEDINGS
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
None - not applicable
PART II
ITEM 5. MARKET PRICE FOR REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
Because this report is being prepared in 1999, the Company has not
been able to obtain any reliable trading history for the period reported.
During the year ended December 31, 1998 there appeared to be little or no
trading in the stock of the Company. As of September 20, 1999, the Company
had approximately 367 shareholders of record.
The Company has not declared any cash dividends on its Common Stock
since inception and its Board of Directors has no present intention of
declaring any dividends. For the foreseeable future, the Company intends to
retain all earnings, if any, for use in the development and expansion of its
business.
Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Financial Condition
The Company had no revenue during the year ended December 31, 1998.
Total stockholders' equity was $107,775, as compared to $(39,975) at December
31, 1997. The Company has no operating capital for future operations.
Liquidity and Capital Resources
The Company has no liquid assets and is currently in the process of
looking for business opportunities to merge with or acquire. At minimum, the
Company will need to raise additional capital through private funding to
meet the financial needs of being a reporting company. There is no guarantee
that the Company will be successful in obtaining necessary funding to develop
any business opportunities.
Results of Operations
The Company reported a net loss of $(2,250) for the year ended
December 31, 1998, compared to a loss of $(3,975) for the previous year. The
Company anticipates very little or no overhead from future operations until
a successor business can be acquired or merged. The only expenses anticipated
in the future is minimum state income taxes, professional fees, and directors
fees.
ITEM 7. FINANCIAL STATEMENTS
(a)(1) The following financial statements of the Company and its
subsidiaries have been filed as part of this report (see Item 8 "Financial
Statements and Supplementary Data"):
Independent Auditors' Report
Balance Sheets as of December 31, 1998.
Statements of Operations for the years ended December 31, 1998 and
December 31, 1997.
Statement of Stockholders' Equity for the period from December 31,
1996 to December 31, 1998.
Statement of Cash Flows for the years ended December 31, 1998 and
December 31, 1997.
Notes to Financial Statements.
(2) Schedules are omitted because of the absence of conditions under
which they are required or because the required information is given in the
financial statements or notes thereto.
PART III
ITEM 8. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following information is furnished with respect to the Company's Board
of Directors and executive officers. There are no family relationship between
or among any of the Company's directors or executive officers.
Directors and Executive Officers
Age Director
Name (1999) Since Position with the Company
Robert Kropf 38 1999 President, CEO and Director
6975 South Union Park Drive
Suite 600
Salt Lake City UT 84047
Mr. Kropf is thirty-eight years old. He is the former owner and operator of a
company called Dinner and Bingo Club. His business experience for the past
seven years has been extensive in restaurant and other retail stores. Mr.
Kropf serves on several other public boards.
ITEM 9. EXECUTIVE COMPENSATION
Compensation of Executive Officers and Directors
During the current fiscal year, no one in the Company's management
received compensation.
Employment Agreements and Other Compensation Arrangements
There are currently no agreements with members of management as to
employment or compensation.
Compensation of Non-Employee Directors
There is currently no compensation paid to non-employment directors.
ITEM 10. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Amount and Nature
Name and Address Of Beneficial Percent of
of Beneficial Owner Ownership Class
International Venture
Capital and Advisory 3,000,000 51.7%
3340 Topaz Street Ste. 310
Las Vegas, Nevada 89121
Item 11. Certain Relationships and Related Transactions
Other than executive compensation, during the reported year the
Registrant did not enter into any transactions with management which are to
be reported under this Item.
Item 12. Exhibits, and Reports on Form 8-K
(A) Exhibits
Exhibit
No. Description
23.01 Consent of Crouch, Bierwolf & Chisholm
27.01 Financial Data Schedule
(b) The Registrant filed no current reports on Form 8-K during the last
quarter of the fiscal year ended December 31, 1998.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Cardinal Industries, Inc.
By: Robert Kropf
/s/ Robert Kropf
Dated: September 20, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons of behalf of the
Registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Robert Kropf President and Director
(Principal Executive and
Financial Officer) September 20, 1999
INDEX TO FINANCIAL STATEMENTS
Report of Independent Certified Public Accountant
Financial Statements:
Balance Sheet - December 31, 1998.
Statements of Operations - For the years ended December 31, 1998 and
December 31, 1997.
Statement of Stockholders' Equity - For the period from December 31,
1988 to December 31, 1998.
Statement of Cash Flows - For the years ended December 31, 1998 and
December 31, 1997.
Notes to Financial Statements
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
of Cardinal Industries, Inc.
We have audited the accompanying balance sheet of Cardinal Industries, Inc.
(a Massachussets Corporation) as of December 31, 1998 and the related
statements of operations, stockholders' equity and cash flows for the years
ended December 31, 1998 and 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide 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 Cardinal Industries, Inc. as
of December 31, 1998 and the results of its operations and cash flows for the
years ended December 31, 1998 and 1997 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2, the
Company's recurring operating losses and lack of working capital raise
substantial doubt about its ability to continue as a going concern.
Management's plans in regard to those matters are also described in Note 2.
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
Salt Lake City, Utah
September 20, 1999
Cardinal Industries, Inc.
Balance Sheets
ASSETS
December 31,
1998
CURRENT ASSETS
Note receivable-related party (Note 4) 150,000
TOTAL ASSETS $ 150,000
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 300
Note payable (Note 5) 39,000
Interest payable 2,925
Total Liabilities 42,225
STOCKHOLDERS' EQUITY
Common stock, $.04 par value;
10,000,000 shares authorized;
5,798,697 shares issued
and outstanding 289,935
Additional paid-in capital 791,165
Retained Deficit (973,325)
Total Stockholders' Equity 107,775
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 150,000
Cardinal Industries, Inc.
Statements of Operations
For the Years Ended
December 31,
1998 1997
REVENUES $ - -
EXPENSES
General & Administrative 300 3,000
Interest 1,950 975
TOTAL EXPENSES 2,250 3,975
Net Loss From Operations (2,250) (3,975)
NET LOSS (2,250) (3,975)
LOSS PER SHARE $ (0.00) $ (0.00)
WEIGHTED AVERAGE SHARES
OUTSTANDING 3,048,697 2,798,697
Cardinal Industries, Inc.
Statement of Stockholders' Equity
For the years ended December 31, 1998 and 1997
Additional
Common Stock Paid-in Retained
Shares Amount Capital Deficit
Balance as of
December 31, 1996 2,798,697 139,935 791,165 (967,100)
Net (loss) - - - (3,975)
Balance as
of December
31, 1997 2,798,697 139,935 791,165 (971,075)
Common
stock
issued for
note receivable
at $.05
per share 3,000,000 150,000 - -
Net (loss) - - - (2,250)
Balance as
of December
31, 1998 5,798,697 $ 289,935 $ 791,165 $ (973,325)
Cardinal Industries, Inc.
Statements of Cash Flows
For the years ended
December 31,
1998 1997
Cash Flows from Operating Activities
Net loss $ (2,250) $ (3,975)
Less non-cash items:
Increase in accounts payable/Notes Payable 2,250 3,975
Net Cash Provided (Used) by
Operating Activities - -
Cash Flows from Investing Activities - -
Cash Flows from Financing Activities
Cash from stock issuance - -
Net Cash Provided (Used) by
Financing Activities - -
Increase in Cash - -
Cash and Cash Equivalents at
Beginning of Period - -
Cash and Cash Equivalents at
End of Period $ - $ -
Supplemental Cash Flow Information:
Cash paid for:
Interest $ - $ -
Income taxes $ - $ -
Cardinal Industries, Inc.
Notes to the Financial Statements
December 31, 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The Company was incorporated as Sanson Institute of Heraldry, Inc., under
the laws of the Commonwealth of Massachussetts on February 21, 1966, for the
purpose of engaging in any lawful business activity. On April 25, 1975, the
Company changed it's name to Cardinal Industries, Inc. The Company is in the
process of changing its domicile to the State of Nevada. There have been no
operations since 1991.
b. Recognition of Revenue
The Company recognized income and expense on the accrual basis of
accounting
c. Earnings (Loss) Per Share
The computation of earnings (loss) per share of common stock is based on
the weighted average number of shares outstanding at the date of the
financial statements.
d. Provision for Income Taxes
No provision for income taxes has been recorded due to net operating loss
carry forwards totaling approximately $973,000 that will be offset against
future taxable income. These NOL carry forwards have already begun to expire.
No tax benefit has been reported in the financial statements because the
Company believes there is a 50% or greater chance the carry forward will
expire unused.
Deferred tax assets and the valuation account is as follows at December
31, 1998
December 31, 1998
Deferred tax asset:
NOL carry forward $ 330,000
Valuation allowance (330,000)
Total $ -
e. Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities, disclosure
of contingent assets and liabilities at the date of the financial statements and
revenues and expenses during the reporting period. In these financial
statements, assets involve extensive reliance on management's estimates.
Actual results could differ from those estimates.
Cardinal Industries, Inc.
Notes to the Financial Statements
December 31, 1998
NOTE 2 - GOING CONCERN
The accompanying financial statements have been prepared assuming that
the company will continue as a going concern. The company has had recurring
operating losses for the past several years and is dependent upon financing to
continue operations. The financial statements do not include any adjustments
that might result from the outcome of uncertainty. It is management's plan to
find an operating company to merge with, thus creating necessary
operating revenue.
NOTE 3 - STOCKHOLDERS' EQUITY
During December 1998, the Company issued 3,000,000 shares of common
stock in exchange for a note receivable in the amount of $150,000.
NOTE 4 - RELATED PARTY TRANSACTIONS
During December 1998, the Company issued 3,000,000 shares of common stock
to International Venture Capital and Advisory, Inc. in exchange for a note
receivable of $150,000. The note bears interest at 5% annually and is due on
demand.
NOTE 5 - NOTES PAYABLE
On July 1, 1997, the Board of Directors approved a conversion of an
account payable of $39,000 for past services of an officer for a convertible
debenture accruing interest at 5% per year. The debenture is convertible on
demand at 75% of market value or par value, whichever is greater.
We hereby consent to the use of our audit report of Cardinal Industries, Inc.
dated September 20, 1999 for the year ended December 31, 1998 in the Form
10KSB Annual Report for the year 1998.
s/s Crouch, Bierwolf & Chisholm
Salt Lake City, UT
September 20, 1999
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