SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: December 31, 1998
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE EXCHANGE ACT
For the transition period from __________ to __________
Commission File No. 33-33939
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
______________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the Issuer (1) filed all
reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 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.
Yes X No
____ ____
As of December 31, 1998, 17,641,460 shares of common stock
were outstanding.
Transitional Small Business Disclosure Format:
Yes No x
____ ____
<PAGE>
TABLE OF CONTENTS
Form 10-QSB
2nd Quarter Ended December 31, 1998
Lindsey Technologies, Inc.
Page
PART I: FINANCIAL INFORMATION
Item 1.
Balance Sheet 2
Statement Of Operations 3
Statement Of Cash Flows 4
Notes To Financial Statements 5
Item 2.
Management's Discussion And
Analysis Or Plan Of Operation 6
PART II: OTHER INFORMATION 7
SIGNATURES 8
<PAGE>
PART I. FINANCIAL INFORMATION
<PAGE> 1
ITEM 1. LINDSEY TECHNOLOGIES, INC.
BALANCE SHEET
DECEMBER 31, 1998
ASSETS
Current assets
Cash $ 48,749
Securities 8,155
Accounts receivable 8,498
____________
Total current assets 65,402
Software 3,446,167
Investment in Heldol 126,150
____________
Total Assets $ 3,637,719
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 66,650
Accounts payable - rel. parties 20,240
Other payable 850,000
Note payable - rel. parties 115,151
____________
Total current liabilities 1,052,041
____________
Total Liabilities 1,052,041
____________
Stockholders' equity
Preferred stock: no par
value, 20,000,000 total,
5,000 Series A authorized,
4,200 shares issued
& outstanding 304,257
Common stock: no par
value, 100,000,000 shares
authorized, 17,641,460 shares
issued & outstanding 10,111,477
Underwriter's warrants,
20,000 issued and outstanding 120
Accumulated other comp. income 541
Accumulated deficit ( 7,830,717)
____________
Stockholders' Equity $ 2,585,678
____________
Total Liabilities And
Stockholders' Equity $ 3,637,719
============
See Notes to Financial Statements
<PAGE> 2
LINDSEY TECHNOLOGIES, INC.
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1997 AND 1998
AND FOR THE SIX MONTHS ENDED DECEMBER 31, 1997 AND 1998
(UNAUDITED)
Three Months Ended Six Months Ended
December 31 December 31
1997 1998 1997 1998
____ ____ ____ ____
Revenues $ - $ 14,562 $ - $ 24,958
Operating expenses:
Research & development - 118,833 500,000 158,097
Gen. & administrative 15,522 69,822 984,649 101,880
________ _________ ___________ _________
Income (loss) from
operations (15,522) (174,093) (1,484,649) (235,019)
________ _________ ___________ _________
Other income (expense):
Gain on securities sales 50 408 84 531
Interest income 1 1 2 2
________ _________ ___________ _________
Total other income 51 409 86 533
________ _________ ___________ _________
Income (loss) before
income taxes (15,471) (173,684) (1,484,563) (234,486)
________ _________ ___________ _________
Provision for income tax - - - -
________ _________ ___________ _________
Net income (loss) (15,471) (173,684) (1,484,563) (234,486)
________ _________ ___________ _________
Other comprehensive income,
net of tax:
Foreign curr. trans. adj. - 262 - 8,157
Unrealized loss on avail-
able-for-sale securities - ( 855) - ( 855)
________ _________ ___________ _________
Comprehensive income $(15,471) $(174,277) $(1,484,563) $(227,184)
======== ========= =========== =========
Net income (loss)
per share $( * ) $( * ) $( .01 ) $( .01 )
========= ========= ========== ==========
Weighted average number of
common shares
outstanding 16,502,260 17,641,460 16,502,260 17,641,460
========== ========== ========== ==========
*Less than $.01 per share
See Notes to Financial Statements
<PAGE> 3
LINDSEY TECHNOLOGIES, INC.
STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED DECEMBER 30, 1997 AND 1998
(UNAUDITED)
Six Months Ended
December 31
1997 1998
____ ____
Cash Flows From Operating Activities:
Net income (loss) $(1,484,563) $(227,184)
Adjustments to reconcile net
income (loss) to net cash
provided by (used for)
operating activities:
Amortization 135,196
Decrease in accounts receivable - 1,388
Compensatory stock issuance 1,374,000 -
Increase (Decrease) in accts. pay. ( 139) 39,897
Increase in accts. pay. - rel. par. 3,782 627
Foreign curr. trans. adj. 5,136 ( 8,157)
Share of loss in Heldol - 11,045
Unrealized loss on securities - 855
----------- ---------
Net cash provided
by (used for)
operating activities ( 101,784) ( 46,333)
----------- ---------
Cash Flows From Investing Activities:
Securities - ( 8,155)
Investment in Heldol ( 2,907) (37,272)
----------- --------
Net cash provided
by (used for)
investing activities ( 2,907) (45,427)
----------- --------
Cash Flows From Financing Activities:
Issuance of common stock 126,064 40,518
Increase in notes payable - 82,171
----------- --------
Net cash provided
by (used for)
financing activities 126,064 122,689
___________ ________
Net Increase (Decrease) In Cash 21,373 30,929
Cash At The Beginning Of The Period 4,837 17,820
___________ ________
Cash At The End Of The Period $ 26,210 $ 48,749
=========== ========
See Notes to Financial Statements
<PAGE> 4
LINDSEY TECHNOLOGIES, INC.
Notes to Financial Statements
(Unaudited)
Note 1. Basis of Presentation
The accompanying unaudited financial statements have been
prepared in accordance with the instructions to
Form 10-QSB and do not include all of the information and
disclosures required by generally accepted accounting
principles for complete financial statements. All
adjustments which are, in the opinion of management,
necessary for a fair presentation of the results of
operations for the interim periods have been made and are
of a recurring nature unless otherwise disclosed herein.
The results of operations for such interim periods are not
necessarily indicative of operations for a full year.
<PAGE> 5
LINDSEY TECHNOLOGIES, INC.
ITEM 2. Management's Discussion and Analysis or Plan of
Operation
On June 21, 1996 Lindsey Technologies, Inc.
(the "Company", "LTI") entered into a joint venture
with a team of French software engineers (the
"Associates") and their wholly owned French corporation,
Helvetius Ingeniere. The Company and the Associates
formed Heldol Corporation ("Heldol") on October 25, 1996,
a United States corporation for the purpose of developing and marketing
software for industrial, medical, and commercial business
applications. The Company plans to capitalize Heldol
with funds such that its total investment in Heldol
over two years will reach 10 million French francs (approximately
$2 million), at which time the Company will
own 80% of Heldol. As of December 31, 1998 the Company has
invested $236,267 and owns 50% of Heldol.
After Heldol is fully capitalized,
Heldol shall be obligated to purchase 30% of the
outstanding shares of Helvetius for 10 million French
francs (approximately $2,000,000).
Another agreement on June 21, 1996 between the Company and
the Associates allows the Associates to exchange their
shares of Helvetius for shares in the Company according to
a market valuation formula, providing Helvetius attains
certain sales levels and the Company is on NASDAQ.
The Associates to date have developed software for
bacteriological identification, trade named HELLAC which
is used by Institut Pasteur, software for the management
of educational and professional training institutions,
trade named HELISA and currently used by French engineering
and business schools such as Ecole Normale Superieure, and
inventory tracking software trade named HAWK, used by NCR.
The Company has undertaken under its own umbrella the
development of a generic management information system that configures
and harmonizes norms and know-how with multimedia capabilities.
This web based product is multi-lingual. It uses the most up to
date information technology standards.
On November 5, 1998, the Company completed a merger with
Distributed Quality Corp. ("DQC"), acquiring all of DQC's issued and
outstanding common stock in exchange for 540,000 common shares of
the Company 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.
<PAGE> 6
PART II. OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters To A Vote of Securities
Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K - None
<PAGE> 7
SIGNATURES
In accordance with the requirements of the Exchange
Act, the Registrant has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly
authorized.
LINDSEY TECHNOLOGIES, INC.
By: /s/Lionel Mauclaire
Lionel Mauclaire, President
and Director
Date: April 15, 1999
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET AT 12/31/98 (UNAUDITED)
AND STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED 12/31/98
(UNAUDITED). IT IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-END> DEC-31-1998
<CASH> 48749
<SECURITIES> 8155
<RECEIVABLES> 8498
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 65402
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3637719
<CURRENT-LIABILITIES> 1052041
<BONDS> 0
0
304257
<COMMON> 10111477
<OTHER-SE> (7830056)
<TOTAL-LIABILITY-AND-EQUITY> 3637719
<SALES> 24958
<TOTAL-REVENUES> 33648
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 260832
<LOSS-PROVISION> 0
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<INCOME-PRETAX> (227184)
<INCOME-TAX> 0
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</TABLE>
