U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: January 18, 1998 (as amended April 20, 1999)
LINDSEY TECHNOLOGIES, INC.
_________________________________________________________________
(Exact name of small business issuer as specified in its charter)
Colorado 84-1121635
_______________________________ __________________
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
3025 South Parker Road, Suite 109
Aurora, Colorado 80014
___________________________________________________________
(Address of principal executive offices, including zip code)
Issuer's Telephone Number: (303) 306-1988
<PAGE>
Item 2. Acquisition or Disposition of Assets
On November 5, 1998, Lindsey Technologies, Inc. (the "Company", "LTI"),
completed a merger with Distributed Quality Corp. ("DQC"), acquiring
all of DQC's issued and outstanding stock in exchange for 540,000 common
shares of LTI valued at $5 per share. Through the merger, LTI acquired
contract rights to a software development package formulated by StellarX,
which is a component based framework, composed of tools and based on
Versant Technology. The development software will help enable the
Company to devise its own quality management information system software.
Included in the package are distribution rights. The Company has recorded
the acquired software at a net value of $2,700,000 based on a combination
of cost and fair market value. The acquisition has been accounted for as
a purchase.
Item 7. Financial Statements and Exhibits
The audited financial statements of Distributed Quality Corp. as of
October 31, 1998 and Independent Auditor's Report appearing on pages
F-1 through F-9 are incorporated herein by reference.
are set forth below. There was no change to DQC's financials
between October 31, 1998 and November 5, 1998, the date
of its merger with Lindsey Technologies, Inc.
Pro forma financial information, as if the balance sheet and income statement
of LTI and DQC were consolidated on September 30, 1998, is set forth below.
Pro Forma Consolidated Balance Sheet Items (9/30/98)
- ----------------------------------------------------
Assets $ 3,739,146
Liabilities 1,050,514
Stockholders' Equity 2,688,632
Pro Forma Consolidated Income Statement Items
(Period for LTI from 7/1/98 to 9/30/98, consolidated with period for
DQC from inception, 7/30/98 to 9/30/98)
- --------------------------------------------------------------------
Revenues $ 18,415
Expenses ( 130,739)
Net Loss ( 112,324)
Consolidated financial information of LTI and DQC as of December 31, 1998
can be found in the Company's 2nd quarter fiscal year end 1999 10-QSB filing.
<PAGE>
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, hereunto duly authorized.
LINDSEY TECHNOLOGIES, INC.
By: /s/Lionel Mauclaire
Lionel Mauclaire, President
Date: April 20, 1999
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Financial Statements
October 31, 1998
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Financial Statements
October 31, 1998
Table of Contents
Page
Independent Auditor's Report F-1
Financial Statements
Balance sheet F-2
Statement of operations F-3
Statement of cash flows F-4
Statement of stockholders' equity F-5
Notes to Financial Statements F-6-F-8
<PAGE>
Larry O'Donnell, CPA, P.C.
2280 South Xanadu Way Telephone (303)745-4545
Suite 370
Aurora, Colorado 80014
Report of Independent Certified Public Accountant
Board of Directors and Stockholder
Distributed Quality Corp.
I have audited the accompanying balance sheet of Distributed Quality Corp.
as of October 31, 1998 and the related statements of
operations, stockholders' equity and cash flows for the period July 30,
1998 (inception) to October 31, 1998. These financial statements are the
responsibility of the Company's management. My responsibility is to express
an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I 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. I believe that my audit provides a
reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Distributed Quality Corp.
as of October 31, 1998, and the results of its
operations and its cash flows for the period July 30, 1998 (inception)
to October 31, 1998 in conformity with generally accepted accounting
principles.
Larry O'Donnell, CPA, P.C.
Aurora, Colorado
February 8, 1999
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Balance Sheet
October 31, 1998
Assets
Software $ 865,000
----------
Total Assets 865,000
==========
Liabilities and Stockholders' Equity
Contracts payable 865,000
----------
Total Liabilities 865,000
----------
Stockholders' equity
Common stock, no par value,
1,000,000 shares authorized,
200,000 issued and outstanding 200
Deficit accumulated during the
development stage ( 200)
----------
Stockholders' Equity -
----------
Total Liabilities and Stockholders' Equity $ 865,000
==========
See Notes to Financial Statements.
F-2
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Statement of Operations
For the Period July 30, 1998 (inception) to October 31, 1998
Sales $ -
Operating expenses 200
---------
Income (loss) from operations ( 200)
Other income (expense) -
---------
Income (loss) before provision
for income taxes ( 200)
Provision for income tax -
---------
Net income (loss) $( 200)
=========
Net income (loss) per share $( .001)
=========
Weighted average number of
common shares outstanding 200,000
=========
See Notes to Financial Statements.
F-3
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Statement of Cash Flows
For the Period July 30, 1998 (inception) to October 31, 1998
Cash flows from operating
activities:
Net income (loss) $( 200)
Adjustments to reconcile
net income loss to net cash
provided by (used for) operations: -
---------
Net cash provided by
(used for) operating
activities ( 200)
---------
Cash flows from financing
activities:
Sale of common stock 200
---------
Net cash flow provided by
financing activities 200
---------
Net increase (decrease) in cash -
Cash at beginning of period -
---------
Cash at end of period $ -
=========
Schedule of Non-Cash Investing and Financing Activities:
None
Supplemental Disclosure:
Cash paid from July 30, 1998 (inception) to October 31, 1998 for
interest and income taxes: None.
See Notes to Financial Statements.
F-4
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Statement of Stockholders' Equity
For the Period July 30, 1998 (inception) to October 31, 1998
<TABLE>
<S> <C> <C> <C>
Total
Common Stock Accumulated Stockholders'
Shares Amount Deficit Equity (Deficit)
Common stock issued
on July 30, 1998
at $.001/share, for cash 200,000 $ 200 $ - $ 200
Net gain (loss)
for the period ended
October 31, 1998 - - (200) (200)
------- ----- ----- -----
Balances, October 31, 1998 200,000 $ 200 $(200) $ -
======= ===== ===== =====
</TABLE>
See Notes to Financial Statements.
F-5
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Distributed Quality Corp.
(A Development Stage Company)
Notes to Financial Statements
Note 1. Organization, Operations and Summary of Significant Accounting
Policies:
Distirbuted Quality Corp. (the "Company") was incorporated in
the state of Colorado on July 30, 1998. The Company was formed to
provide software distribution services for software providers, and has
signed an agreement with StellarX, Inc. ("StellarX") giving the
Company a distribution right for software developed by StellarX.
The Company has conducted only limited planned principal operations
and is a development stage company.
Income tax - Deferred taxes are provided on a liability method whereby
deferred tax assets are recognized for deductible temporary differences
and operating loss carryforwards and deferred tax liabilities are
recognized for taxable temporary differences. Temporary differences are
the differences between the reported amounts of assets and liabilities
and their tax bases. Deferred tax assets are reduced by a valuation allowance
when, in the opinion of management, it is more likely than not that some
portion or all of the deferred tax assets will not be realized. Deferred
tax assets and liabilities are adjusted for the effects of changes in tax
laws and rates on the date of enactment.
Use of Estimates - 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 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 differ from those estimates.
Net income (loss) per share - The net income (loss) per share is computed
by dividing the net income (loss) by the weighted average number of
common shares outstanding during the respective periods. Warrants, stock
options, and common stock issuable upon conversion of the Company's preferred
stock are not included in the computation if the effect of such inclusion
would be anti-dilutive and would increase the earnings or decrease loss per
share.
Cash and cash Equivalents - The Company all highly liquid investments with an
original maturity of three months or less to be cash equivalents.
Accounting year - The Company employs a fiscal accounting year ending
on June 30.
F-6
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Distributed Quality Corp.
(A Development Stage Company)
Notes to Financial Statements (continued)
Note 2. Related Party Transactions
On July 30, 1998 Directors, Officers, and other insiders purchased 200,000
common shares from the Company at $.001 per share.
The Company has acquired distribution rights to certain software by
signing a license agreement with StellarX. The Company and StellarX have
common shareholders, officers and directors.
Note 3. Income taxes
Deferred income taxes arise from the temporary differences between financial
statement and income tax recognition of net operating losses. These loss
carryovers are limited under the Internal Revenue Code should a significant
change in ownership occur. The Company accounts for income taxes pursuant
to SFAS 109. No income tax accruals have been made at October 31, 1998 as the
Company has not yet completed a full tax accounting cycle.
Note 4. Stockholders' Equity
Common stock - The Company as of October 31, 1998 had 1,000,000 shares of
authorized common stock, no par value, with 200,000 shares issued and
outstanding.
F-7
<PAGE>
Distributed Quality Corp.
(A Development Stage Company)
Notes to Financial Statements (continued)
Note 5. Software Agreement
The Company has an exclusive license agreement with StellarX which includes
the unlimited distribution right of software applications and a development
license. Under the terms of the agreement, the Company is required to pay
10% of its application revenue and 5% of its maintenance revenue to
StellarX. The Company is also required to contribute to research and
development costs of StellarX for each year ended December 31 as follows:
1998 $15,000; 1999 $100,000; 2000 $200,000; 2001 $250,000; 2002 $250,000.
F-8
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