<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended September 30, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _______________ to _________________
Commission file number 0-19693
BIO FLUORESCENT TECHNOLOGIES, INC. .
(Exact name of registrant as specified in its charter)
Nevada . 87-0485320 .
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification No.)
7373 North Scottsdale Road, Suite D222, Scottsdale, Arizona 85253
(Address of principal executive offices)
602-596-0269
(Issuer's telephone number)
None
Former name, former address and former fiscal year, if changed since last
report.
Applicable only to issuers involved in bankruptcy proceedings
during the preceding five years.
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the last 12 months (or for such
shorter period that the registrant was required to file such report(s), and (2)
has been subject to such filing requirements for the past 90 days,
Yes No X
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: September 30, 1996,
17,937,132 common shares of par value $.001 outstanding.
Transitional Small Business Disclosure Format (Check One):
Yes No X
--- ---
<PAGE> 2
BIO FLUORESCENT TECHNOLOGIES, INC.
Table of Contents
<TABLE>
<CAPTION>
PART 1 Financial Information Page No.
- ------ --------------------- --------
<S> <C>
Item I Financial Statements
Condensed Balance Sheet 3
Condensed Statements of Operations 4
Condensed Statements of Cash Flow 5
Notes to Condensed Financial Statements 6
Item 2 Plan of Operations 8
PART II Other Information
Item 1 Legal Proceedings 9
Item 2 Changes in Securities N/A
Item 3 Defaults Upon Senior Securities N/A
Item 4 Submission and Matters to a Vote of Security Holders N/A
Item 5 Other Information N/A
Item 6 Exhibits and Reports on Form 8-K N/A
SIGNATURES
</TABLE>
<PAGE> 3
Bio Fluorescent Technologies, Inc.
(A Company in the Development Stage)
Condensed Balance Sheet
September 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Assets
<S> <C>
Current Assets:
Cash $ 110,142
Trade exchange receivable - barter 49,887
Media products and services receivable - current portion 256,003
-----------
Total current assets 416,032
Media Products and Services Receivable - non current portion 250,000
License, net of accumulated amortization 858,500
-----------
$ 1,524,532
===========
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 91,884
Accrued expenses 55,056
----------
Total current liabilities 146,940
----------
Stockholders' Equity:
Common stock, $0.001 par value, Authorized 25,000,000 shares, 17,937
issued and outstanding 17,937,132 shares
Additional paid-in capital 4,037,587
Subscription of common stock sales receivable (238,000)
Deficit accumulated during development stage (2,439,932)
-----------
Total stockholders' equity 1,377,592
-----------
$ 1,524,532
===========
</TABLE>
The accompanying notes are an integral part of these condensed financial
statements.
<PAGE> 4
Bio Fluorescent Technologies, Inc.
(A Company in the Development Stage)
Condensed Statements of Operations for
the three and nine month periods ended September 30, 1996 and 1995
and for the period from inception of development stage (February 15, 1990) to
September 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Cumulative from the
Three month period Nine month period inception of
ended September 30 ended September 30, Development stage
-------------------- --------------------- (February 15, 1990) to
1996 1995 1996 1995 September 30,1996
------ ------ ------ ------ -----------------
<S> <C> <C> <C> <C> <C>
Net Sales $ -0- $ -0- $ -0- $ -0- $ -0-
Selling, general &
administrative expenses 425,222 484,958 1,054,475 687,470 2,440,038
------------ ------------ ------------ ------------ -----------
Loss from operations (425,222) (484,958) (1,054,475) (687,470) (2,440,038)
Interest Income -0- -0- 106 -0- 106
------------ ------------ ------------ ------------ -----------
Loss before provision for
income taxes (425,222) (484,958) (1,054,369) (687,470) (2,439,932)
Provision for income taxes -0- -0- -0- -0- -0-
------------ ------------ ------------ ------------ -----------
Net Loss $ (425,222) (484,958) $ (1,054,369 $ (687,470) $(2,439,932)
============ ============ ============ ============ ===========
Loss per common share $ (0.03) $ (0.04) $ (0.07) $ (0.06)
============ ============ ============ ============
Weighted average number
of common shares outstanding 16,060,338 11,700,000 14,098,073 11,700,000
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these condensed financial
statements.
<PAGE> 5
Bio Fluorescent Technologies, Inc.
(A Company in the Development Stage)
Condensed Statements of Cash Flows for the Nine month periods
ended September 30, 1996 and 1995 and for the period from
inception of development stage (February 15, 1990) to September 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Cumulative from the
Three month period Nine month period inception of
ended September 30 ended September 30, Development stage
-------------------- --------------------- (February 15,1990) to
1996 1995 1996 1995 September 30,1996
------ ------ ------ ------ -----------------
<S> <C> <C> <C> <C> <C>
Cash flows from operations:
Net loss $(425,222) $ (220,743) $(1,054,369) $ (687,470) $(2,439,932)
Adjustments to reconcile net loss to
net cash used in operating activities:
Amortization 25,500 76,500 161,500
Writedown of artwork 400,000
Common stock issued for services 144,000 144,000 270,748
Change in assets and liabilities: (400,000) (400,000) --
Increase in prepaid expenses (6,003) (4,128) (5,000) (6,003)
Increase in trade exchange receivable (500,000) 113 (500,000) 113
Increase in accounts payable and
accrued expenses (218,231) 20,515 (36,602) 97,600 146,940
--------- ----------- ----------- ----------- -----------
Net cash used in operating activities (479,956) (1,364,743) (874,486) (1,494,870) (1,466,634)
--------- ----------- ----------- ----------- -----------
Cash flows from financing activities:
Sale and issue of common stock, net 550,000 1,413,873 703,796 1,544,873 1,314,776
Sale of stock subscriptions(net of
subscriptions receivable) 40,000 -0- 262,000 -0- 262,000
--------- ----------- ----------- ----------- -----------
Cash provided by financing activities 590,000 1,413,873 965,796 1,544,873 1,576,776
--------- ----------- ----------- ----------- -----------
Net increase in cash funds 110,044 49,430 91,310 50,003 110,142
Cash, beginning of period 98 573 18,832 -0- -0-
--------- ----------- ----------- ----------- -----------
Cash, end of period $ 110,142 $ 50,003 $ 110,142 $ 50,003 $ 110,142
========= =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these condensed financial
statements.
<PAGE> 6
BIO FLORESCENT TECHNOLOGIES, INC.
(A COMPANY IN THE DEVELOPMENT STAGE)
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 1996
1. THE COMPANY AND ITS SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
HISTORY AND REPORTING ENTITY
Bio Florescent Technologies, Inc. (the Company) is a development stage company
that was incorporated under the laws of the state of Nevada in February 1990 as
Partisan Corporation. On March 10, 1995, the Company's name was changed from
Partisan Corporation to Bio Florescent Technologies, Inc. The Company was
inactive through February 1995 and prior to such time the Company's only
activities consisted of the sale or transfer of shares of its common stock in
private placements.
BASIS OF PRESENTATION
The unaudited condensed financial statements and related notes have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Accordingly, certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and regulations.
The accompanying financial statements and related notes should be read in
conjunction with the audited financial statements of the company and notes
thereto, for the fiscal year ended December 31, 1995.
The information furnished reflects, in the opinion of management, all
adjustments, consisting of normal recurring accruals, necessary for a fair
presentation of the results of the interim period presented.
USE OF 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.
LOSS PER COMMON SHARE
Loss per common share is computed by dividing the net loss by the weighted
average number of common shares outstanding during the period. Fully diluted
loss per common share is considered equal to primary loss per common share for
all periods presented.
RECENTLY ISSUED ACCOUNTING STANDARDS
SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of, which is required to be adopted by the
company in 1996, may have a material effect on the Company's financial position
or its results of operations upon adoption as noted in Paragraph Two of the Plan
of Operations. SFAS No. 123, Accounting for Stock-Based Compensation, is
required to be adopted by the Company in 1996. Pursuant to the provisions of
SFAS No. 123, the Company will continue to account for transactions with its
employees pursuant to Accounting Principles Board Opinion No. 25, Accounting
for Stock Issued to Employees. Therefore, this statement is not expected to
have a material effect on the Company's financial position or its results of
operations when adopted.
<PAGE> 7
PLAN OF OPERATIONS
The Company is presently concentrating its efforts on opportunities
created by critical global health care concerns to more rapidly and reliably
detect viruses such as HIV 1/2 and Hepatitis B.
The Company had secured worldwide rights to manufacture, market and
sell the Mehica GP120 System in February 1995. On July 19, 1996, the Company
filed a complaint in the United States District Court for the District of
Maryland (Civil Action No. CCB 96-2266) against the licensor, The Avriel Group
and others, seeking declaratory relief, damages and other relief in respect to
certain agreements relating to the rights to a proprietary automated system for
detection of the HIV virus and for use in mass screening of individuals, the
Packaged Antigen Kit or "PAK" and the Mehica GP120. On July 30, 1996, the
defendants filed an answer, counterclaim and third party complaint, seeking
declaratory relief in respect of the agreements and damages. The Company is
cautiously optimistic that the dispute can be resolved by and through a
negotiated settlement without further litigation. The outcome of this litigation
may have a material adverse effect on the recorded, unamortized cost of the
license agreement.
The Company plans to aggressively pursue the acquisition of other
products through licensing and/or acquiring businesses with technology or proven
sales and operating history which are compatible with corporate strategies.
The Company re-organized its management team in May 1996 to proceed
with the implementation of its business plan and the acquisition of compatible
products to establish the Company as an operating Company as soon as possible.
One of the growth strategies of the business plan is to expand the
Company's core market to include a broader range of screening and detection
devices for viral and infectious diseases. The Company has signed a contract
with SANNES & ASSOCIATES to consult in the search for expanding the Company's
infectious disease technology. SANNES & ASSOCIATES has extensive research,
product development and product introduction skills. Their professional careers
have given them firsthand knowledge of these functions with major pharmaceutical
and medical equipment manufacturing companies.
To date, the Company's operations have consisted primarily of obtaining
a license for a system, assembling a management team and raising capital. From
the Company's inception to September 30, 1996, the Company's business
development costs have totaled approximately $2,439,932. These expenditures have
been funded primarily with the proceeds from the private sales of its equity
securities as well as with the issuance of its common stock in exchange for
services.
From inception to September 30, 1996, the Company's development
activities resulted in a deficit in cash flow of approximately $1,466,000. This
deficit was primarily the result of the cumulative net operating loss of
approximately $2,440,000 offset by noncash charges totaling approximately
$832,000 related to the write off of artwork purchased with common stock, common
stock issued for services and amortization associated with the Company's license
to the
<PAGE> 8
Mehica GP120 System. Additionally, the deficit in cash flow from operating
activities was offset by an increase in accounts payable and accrued liabilities
of approximately $147,000.
The Company's financing activities since inception provided cash flow
of approximately $1,577,000 through September 30, 1996. This was the result of
the private placement of 8,897,083 shares of the Company's common stock.
The Company will need to raise additional operating capital to satisfy
its obligations and to fund other operating expenses of the business. As of the
date of this filing, the Company has not obtained such financing. Failure by the
Company to obtain such additional financing would have a material adverse effect
on the Company.
<PAGE> 9
PART II Other Information
Item 1. Legal Proceedings:
Refer to Plan of Operations (Page 8) for information on legal
action initiated by Bio Fluorescent Technologies, Inc. against
The Avriel Group and others on July 19, 1996, and their
counter-suit.
Item 2. Changes in securities.
Not Applicable.
Item 3. Defaults on Senior Securities.
Not Applicable
Item 4. Submission and Matters to a Vote of Security Holders.
Not Applicable
Item 5. Other Information.
Not Applicable
Item 6. Exhibits and Reports on Form 8-K.
Not Applicable
<PAGE> 10
SIGNATURES
Pursuant to the regulation requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Date: November 19, 1996 Bio Fluorescent Technologies, Inc.
(Registrant)
By: \s\ Jan J. Olivier
----------------------
Jan J. Olivier
President, Director
By: \s\ Wynn J. Bott
----------------------
Wynn J. Bott
Controller
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 110,142
<SECURITIES> 0
<RECEIVABLES> 549,887
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 416,032
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,524,532
<CURRENT-LIABILITIES> 146,940
<BONDS> 0
0
0
<COMMON> 17,937
<OTHER-SE> 1,359,655
<TOTAL-LIABILITY-AND-EQUITY> 1,524,532
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,054,475
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,054,369)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,054,369)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,054,369)
<EPS-PRIMARY> (.07)
<EPS-DILUTED> (.07)
</TABLE>
