<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report(Date of earliest event reported): February 12, 1997
CAPITAL 2000, INC.
------------------
(Exact name of registrant as specified in its charter)
Colorado 33-11062-D 84-1049047
- ------------------------------- ----------- -------------------
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) file number) Identification No.)
602 Main Street, Suite 1102, Cincinnati, Ohio 45202
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(Address of principal executive offices)
Registrant's telephone number, including area code (513) 241-7470
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<PAGE> 2
This amendment on Form 8-K/A to the Company's Current Report on Form 8-K, dated
April 1, 1997, is being filed to include, as an addendum, the audited financial
statements of the United Shields Corporation.
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
- ------- ---------------------------------
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
- ------- -------------------------------------
Effective February 12, 1997 Capital 2000, Inc. (the "Company")
acquired all of the outstanding shares of United Shields Corporation ("USC")
in exchange for restricted shares of the Company's common stock (the "Common
Stock") (the "Exchange") pursuant to a Share Exchange Agreement between the
Company and USC. After the Exchange, USC's shareholders own approximately 90%
of the of the outstanding Common Stock. In connection with the Exchange, the
directors and officers of USC became the directors and officers of the Company.
The directors and officers of USC, and the Company as of the effective date of
the Exchange, are T. J. Tully, Anthony G. Covatta and James J. Carroll.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
- ------- ----------------------------------
(a) Financial Statements of Business Acquired
Form 8-K/A
Page
-----------
Report of Independent Certified Public F-2
Accountants
Balance Sheet of United Shields Corporation, F-3
December 31, 1995 and December 31, 1996
For each of United Shield Corporation's
two fiscal years in the period
ended December 31, 1996
Statements of Operations F-4
Statements of Deficit & Stockholders' Equity F-5
Statements of Cash Flows F-6
Notes to Financial Statements F-7
(b) Pro Forma Financial Information
For financial reporting purposes, the transaction will be
accounted for as a reverse aquisition whereby USC will be
considered the accounting acquirer. The Company has no
assets. Consequently, proforma financial information is not
being filed.
(c) Exhibits
<TABLE>
<CAPTION>
Filed
Herewith
(Page No.)
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Exhibit
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<S> <C> <C>
10.1 Share Exchange Agreement by and
between Capital 2000, Inc. and United Incorporated by Reference
Shields Corporation dated February 12, to Exhibit 10.1 of Company's
1997 Form 8-K filed April 1, 1997
</TABLE>
- 2 -
<PAGE> 3
SIGNATURES
Pursuant to the requirements 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.
CAPITAL 2000, INC.
By: /s/ T. J. Tully
------------------------------
T. J. Tully, CEO and President
Date: April 28, 1997
<PAGE> 4
CONTENTS
Page
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS 3
FINANCIAL STATEMENTS
BALANCE SHEETS 4
STATEMENTS OF OPERATIONS 5
STATEMENTS OF DEFICIT IN STOCKHOLDERS' EQUITY 6
STATEMENTS OF CASH FLOWS 7
NOTES TO FINANCIAL STATEMENTS 8
F-1
<PAGE> 5
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
United Shields Corporation
We have audited the accompanying balance sheets of United Shields Corporation (a
Nevada Corporation and development stage enterprise) as of December 31, 1996 and
1995, and the related statements of operations and accumulated deficit and cash
flows for each of the two years in the period ended December 31, 1996 and for
the period July 26, 1993 (date of inception) to December 31, 1996. 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 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 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 United Shields Corporation as
of December 31, 1996 and 1995, and the results of its operations and its cash
flows for each of the two years in the period ended December 31, 1996 and for
the period July 26, 1993 (date of inception) to December 31, 1996 in conformity
with generally accepted accounting principles.
Cincinnati, Ohio
March 31, 1997
F-2
<PAGE> 6
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEETS
December 31,
<TABLE>
<CAPTION>
ASSETS 1996 1995
<S> <C> <C>
CURRENT ASSETS
Cash $ 107 $ 11,966
Accounts receivable - officers 6,955 --
--------- ---------
Total current assets 7,062 11,966
MARKETING AGREEMENT, net 81,667 101,667
--------- ---------
$ 88,729 $ 113,633
========= =========
LIABILITIES
CURRENT LIABILITIES
Notes payable - stockholders $ 79,919 $ 116,759
Accounts payable 213,368 --
Accrued liabilities - interest 11,831 3,126
--------- ---------
Total current liabilities 305,118 119,885
COMMITMENTS -- --
DEFICIT IN STOCKHOLDERS' EQUITY
Common stock - authorized 6,000,000 shares without
par value; issued and outstanding 5,796,000 and 5,599,300
at aggregate value at December 31, 1996 and 1995, respectively 63,102 35,002
Stock subscribed, not yet issued - 66,500 shares at December 31,
1996, no par value 133,000 --
Deficit accumulated during the development stage (412,491) (41,254)
--------- ---------
(216,389) (6,252)
--------- ---------
$ 88,729 $ 113,633
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
F-3
<PAGE> 7
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS
For the years ended December 31,
<TABLE>
<CAPTION>
JULY 26, 1993
(DATE OF INCEPTION)
1996 1995 TO DECEMBER 31, 1996
<S> <C> <C> <C>
Start-up and organizational costs $(82,069) $(4,293) $(106,864)
Amortization (20,000) (13,333) (33,333)
Bottle purchase requirements (232,363) -- (232,363)
Stock issued for compensation (28,100) -- (28,100)
--------- -------- ---------
Operating loss (362,532) (17,626) (400,660)
Other expense
Interest (8,705) (2,222) (11,831)
--------- -------- ---------
Loss before income taxes (371,237) (19,848) (412,491)
Income taxes -- -- --
--------- -------- ---------
NET LOSS $(371,237) $(19,848) $(412,491)
========= ======== =========
</TABLE>
The accompanying notes are an integral part of these statements.
F-4
<PAGE> 8
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF DEFICIT IN STOCKHOLDERS' EQUITY
For the years ended December 31,
<TABLE>
<CAPTION>
COMMON STOCK ACCUMULATED
STOCK SUBSCRIPTIONS DEFICIT TOTAL
<S> <C> <C> <C> <C>
Balance at January 1, 1995 $ -- $ -- $(21,406) $(21,406)
Shares issued:
5,599,300 shares in exchange for $35,002 35,002 -- -- 35,002
Net loss during the development stage -- -- (19,848) (19,848)
------- -------- --------- ---------
Balance at December 31, 1995 35,002 -- (41,254) (6,252)
Shares issued:
196,700 shares, at estimated value 28,100 -- -- 28,100
Stock subscribed, not yet issued - 66,500
shares in exchange for $133,000 -- 133,000 -- 133,000
Net loss during the development stage -- -- (371,237) (371,237)
------- -------- --------- ---------
Balance at December 31, 1996 $63,102 $133,000 $(412,491) $(216,389)
======= ======== ========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
F-5
<PAGE> 9
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
For the years ended December 31,
<TABLE>
<CAPTION>
JULY 26, 1993
(DATE OF INCEPTION)
1996 1995 TO DECEMBER 31, 1996
Net cash flows provided by (used in) operating activities:
<S> <C> <C> <C>
Net loss accumulated during the development stage $(371,237) $(19,848) $(412,491)
Adjustments to reconcile net loss to net
cash used in operating activities:
Amortization 20,000 13,333 33,333
Stock issued for compensation 28,100 -- 28,100
Changes in assets and liabilities:
Increase in accounts receivable (6,955) -- (6,955)
Increase in accounts payable 213,368 -- 213,368
Increase in accrued liabilities 8,705 2,222 11,831
--------- --------- ---------
Net cash used in operating activities (108,019) (4,293) (132,814)
Cash flows used in investing activities:
Acquisition of marketing agreement -- (110,000) (115,000)
Cash flows provided by (used in) financing activities:
Borrowings on notes payable 73,119 99,257 197,878
Payments on notes payable (109,959) (8,000) (117,959)
Proceeds from issuance of stock -- 35,002 35,002
Proceeds from stock subscribed 133,000 -- 133,000
--------- --------- ---------
Net cash provided by financing activities 96,160 126,259 247,921
--------- --------- ---------
Net increase (decrease) in cash (11,859) 11,966 107
Cash at beginning of period 11,966 -- --
--------- --------- ---------
Cash at end of period $107 $11,966 $107
========= ========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
F-6
<PAGE> 10
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
December 31, 1996 and 1995
NOTE A - SUMMARY OF ACCOUNTING POLICIES
The Corporation is a development stage company incorporated July 26, 1993.
The Corporation was organized to market a patented collapsible bottle for
use with beverage products. The Corporation's primary activities since
incorporation have been locating uses for the bottles, financial planning,
searching for business partners and raising capital. A summary of the
significant accounting policies consistently applied in the preparation of
the accompanying financial statements follows.
1. Accounts Receivable
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The Corporation considers accounts receivable to be fully collectible;
accordingly, no allowance for doubtful accounts is required. If amounts
become uncollectible, they will be charged to operations when that
determination is made.
2. Marketing Agreement
-------------------
The cost of obtaining a marketing agreement is amortized using the
straight-line method over a period of approximately six years.
3. Use of Estimates in Financial Statements
----------------------------------------
In preparing financial statements in conformity with generally accepted
accounting principles, management makes 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,
as well as the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE B - NOTES PAYABLE - STOCKHOLDERS
Notes payable to stockholders, totaling $31,759 at December 31, 1995, are
the result of reimbursing stockholders for expenses in connection with
corporation activities. The notes were repaid in 1996 and had a 6% interest
rate.
The 8% notes payable to stockholders, in the amount of $79,919 and $85,000
at December 31, 1996 and 1995, respectively, are payable upon demand.
F-7
<PAGE> 11
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1996 and 1995
NOTE C - MARKETING AGREEMENT
The Corporation entered into an agreement to obtain the world wide marketing
rights to sell a collapsible plastic bottle. The Corporation was assigned
the marketing rights by a related party which is owned by two of the
majority shareholders of the Corporation. The Corporation paid $115,000 for
these rights which was the cost to the related party. The agreement requires
minimum purchase commitments of bottles during each of the contract years as
specified in the agreement. The purchase price of the bottles is defined in
the agreement based on raw material costs and margin.
Included in accounts payable at December 31, 1996 is $204,863 relating to
remaining payments due under the minimum purchase requirements at the end of
the first contract year.
If minimum purchase requirements are not met, the Corporation is committed
to pay $100,000 per year for a licensing fee through 2000 in addition to
minimum purchase requirements under the remaining contract years as follows
(terms are stated in Canadian dollars):
<TABLE>
<CAPTION>
APPROXIMATE
U.S. DOLLARS
------------
<S> <C> <C>
1997 $ 500,000 CDN $ 365,000
1998 2,000,000 CDN 1,460,000
1999 3,500,000 CDN 2,555,000
2000 6,000,000 CDN 4,380,000
----------- ----------
$12,000,000 CDN $8,760,000
=========== ==========
</TABLE>
Accumulated amortization of the marketing agreement is $33,333 and $13,333
at December 31, 1996 and 1995, respectively.
The Corporation has also committed to pay the related party an amount equal
to $.05 for each collapsible bottle sold by the Corporation for the first
five million bottles sold, up to a maximum of $250,000.
NOTE D - STOCK SPLIT
On December 13, 1996, the Corporation's Board of Directors approved a
seven-for-one stock split to shareholders of record December 13, 1996. The
split resulted in the issuance of 4,800,000 new shares of common stock. All
share amounts have been adjusted to reflect the stock split.
NOTE E - COMMITMENT
The Corporation has entered into a twelve month consulting agreement which
requires monthly payments of $3,500.
F-8
<PAGE> 12
UNITED SHIELDS CORPORATION
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1996 and 1995
NOTE F - INCOME TAXES
Deferred income tax liabilities and assets are provided for temporary
differences between the tax basis and reported amounts of assets and
liabilities that will result in taxable or deductible amounts in future
years.
Deferred tax benefits are recorded only to the extent that the amount of net
deductible temporary differences or carryforward attributes may be utilized
against current period earnings, offset against taxable temporary
differences reversing in future periods, or utilized to the extent of
management's estimate of future taxable income.
The Corporation's principal temporary difference results from the deferral
of start-up costs for tax purposes.
Net deferred tax assets have been offset by a valuation allowance of equal
amounts at December 31, 1996 and 1995, due to the uncertainty of realizing
the net deferred tax asset through future operations. The valuation
allowances were $140,000 and $14,000 at December 31, 1996 and 1995,
respectively. The valuation allowance increased $126,000 at December 31,
1996. Gross deferred tax liabilities were immaterial for both years.
NOTE G - SUBSEQUENT EVENTS
In January 1997, the Corporation completed a private offering of 204,000
shares of its common stock. Proceeds of $133,000 received prior to December
31, 1996 (stock subscribed) and the remaining proceeds of $275,000 received
in January 1997 are being used to fund operations.
In January 1997, the Corporation also issued a letter of intent to acquire a
plastic bottle preform manufacturer.
In February 1997, the Corporation entered into a transaction whereby
stockholders exchanged all shares of the Corporation for 90% of the then
issued and outstanding shares of Capital 2000, Inc. Officers and Directors
of the Corporation have replaced those of Capital 2000, Inc. and have
assumed management control of Capital 2000, Inc.
For financial reporting purposes, the transaction will be accounted for as a
reverse acquisition whereby the Corporation will be considered the
accounting acquirer. Capital 2000, Inc. has no assets.
F-9
