UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number: 33-55254-38
Ultronics Corporation
(Exact name of registrant as specified in its charter)
Nevada 87-0485313
(State or other jurisdiction of (IRS Employer Identification
incorporated or organization) Number)
4348 Butternut Road
Salt Lake City, Utah 84124
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (801) 272-2432
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
State issuer's revenues for its most recent fiscal year: None
State the aggregate market value of the voting stock held by nonaffiliates of
the registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within the past 60 days: The Company does not have
an active trading market and it is, therefore, difficult, if not impossible, to
determine the market value of the stock. Based on the most recent bid price for
the Company's Common Stock at December 30, 1998, of $0.188 per share, the market
value of shares held by nonaffiliates would be $188,000.
As of March 31, 1999, the Registrant had 6,000,000 shares of common stock issued
and outstanding at $.001 par value.
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 months and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
HISTORY AND ORGANIZATION
Ultronics Corporation (the "Company") was incorporated under the laws
of Nevada on March 14, 1990. The Company's only prior activity related to the
sale of shares of its common stock to Capital General Corporation and the
gifting of shares to certain individuals. The Company's prior management who
were associated with Capital General Corporation resigned in 1997 and the
Company's new management took control of the Company. The Company has never had
operations and since it was formed its primary mission has been to investigate
potential companies that would be interested in merging with it.
In 1997, the Company sold 5,000,000 shares of its common stock for an
aggregate purchase price of $25,000. The majority of the shares were sold to the
Company's current president and director, W. Reed Jensen and his adult children.
The Company is currently seeking potential business acquisition or
opportunities to enter in an effort to commence business operations. The Company
does not propose to restrict its search for a business opportunity to any
particular industry or geographical area and may, therefore, engage in
essentially any business in any industry. The Company has unrestricted
discretion in seeking and participating in a business opportunity, subject to
the availability of such opportunities, economic conditions, and other factors.
The selection of a business opportunity in which to participate is
complex and risky. Additionally, as the Company has only limited resources, it
may be difficult to find good opportunities. There can be no assurance that the
Company will be able to identify and acquire any business opportunity which will
ultimately prove to be beneficial to the Company and its shareholders. The
Company will select any potential business opportunity based on management's
business judgment.
The activities of the Company are subject to several significant risks
which arise primarily as a result of the fact that the Company has no specific
business and may acquire or participate in a business opportunity based on the
decision of management which potentially could act without the consent, vote, or
approval of the Company's shareholders. The risks faced by the Company are
further increased as a result of its lack of resources and its inability to
provide a prospective business opportunity with significant capital.
ITEM 2. DESCRIPTION OF PROPERTIES
The Company's administrative offices are located at 4348 Butternut Road,
Salt Lake City, Utah 84124, which are the offices of W. Reed Jensen, the
president of the Company. Mr. Jensen has allowed the Company to use this office
without charge.
ITEM 3. LEGAL PROCEEDINGS
Neither the Company nor its current president and director are involved
in any legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
No matters were submitted to a vote of shareholders of the Company
during the fourth quarter of the fiscal year ended December 31, 1998.
2
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PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
The Company's Common Stock is quoted on the National Association of
Securities Dealers Electronic Bulletin Board under the symbol "UTRO." Set forth
below are the high and low bid prices for the Company's Common Stock since the
fourth quarter of 1997 when the Company's Common Stock was listed on the
Electronic Bulletin Board. Although the Company's Common Stock is quoted on the
Electronic Bulletin Board it has traded sporadically with no real volume.
Consequently, the information provided below may not be indicative of the
Company's Common Stock price under different conditions.
Quarter Ended High Bid Low Bid
-------------------------- ----------- --------------
Fourth Quarter 1997 $ 0.125 $ 0.125
First Quarter 1998 $ 0.125 $ 0.125
Second Quarter 1998 $ 0.125 $ 0.125
Third Quarter 1998 $ 0.125 $ 0.125
Fourth Quarter 1998 $ 0.50 $ 0.125
At March 31, 1999, the bid price for the Company's Common Stock was
$0.125 and there was no ask price. All prices listed herein reflect inter-dealer
prices, without retail mark-up, mark-down or commissions and may not represent
actual transactions. Since its inception, the Company has not paid any dividends
on its Common Stock, and the Company does not anticipate that it will pay
dividends in the foreseeable future. At March 31, 1999, the Company had
approximately 378 shareholders.
ITEM 6. SELECTED FINANCIAL DATA
ULTRONICS CORPORATION
SUMMARY OF OPERATIONS
DECEMBER, 1998
<TABLE>
<CAPTION>
1998 1997 1996 1995 1994
------------- ------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Total Assets........................ 17,643 25,000 0 0 0
Revenues............................ 0 0 0 0 0
Operating Expenses.................. 4,734 2,623 0 0 0
Net Earnings (Loss)................. (4,734) (2,623) 0 0 0
Per Share Data Earnings (Loss)...... 0 0 0 0 0
Average Common Shares
Outstanding.................... 6,000,000 1,260,274 1,000,000 1,000,000 1,000,000
</TABLE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
OVERVIEW
Since its organization, the Company has had no operations. The Company
was organized to engage in the acquisition of assets, properties or a business
without regard to any specific industry or type of business. The Company intends
to take advantage of any reasonable business proposal presented which management
believes will provide the Company and its stockholders with a viable business
opportunity. The board of directors will make the final approval in determining
whether to complete any acquisition, and unless required by applicable law, the
articles of incorporation or bylaws or by contract, stockholders' approval will
not be sought.
The investigation of specific business opportunities and the
negotiation, drafting, and execution of relevant agreements, disclosure
documents, and other instruments will require substantial management time and
attention and will require the Company to incur costs for payment of
accountants, attorneys, and others. If a decision is made not to participate in
or complete the acquisition of a specific business opportunity, the costs
incurred in a related
3
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investigation will not be recoverable. Further, even if an agreement is reached
for the participation in a specific business opportunity by way of investment or
otherwise, the failure to consummate the particular transaction may result in
the loss to the Company of all related costs incurred.
Currently, management is not able to determine the time or resources
that will be necessary to locate and acquire or merge with a business prospect.
There is no assurance that the Company will be able to acquire an interest in
any such prospects, products or opportunities that may exist or that any
activity of the Company, regardless of the completion of any transaction, will
be profitable.
If and when the Company locates a business opportunity, management of
the Company will give consideration to the dollar amount of that entity's
profitable operations and the adequacy of its working capital in determining the
terms and conditions under which the Company would consummate such an
acquisition. Potential business opportunities, no matter which form they may
take, will most likely result in substantial dilution for the Company's
shareholders due to the issuance of stock to acquire such an opportunity.
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 1998, the Company had $17,643 in assets and
liabilities of $0. The Company has only incidental ongoing expenses primarily
associated with maintaining its corporate status and maintaining the Company's
reporting obligations to the Securities and Exchange Commission. For the twelve
months ended December 31, 1998, the Company's principal expenses were
professional fees of $4,522. Prior to control of the Company changing, the
obligations and expenses of the Company were paid by prior management and
Capital General Corporation.
Since inception the Company has not generated revenue and it is
unlikely that any revenue will be generated until the Company locates a business
opportunity with which to acquire or merge. Management of the Company will be
investigating various business opportunities. These efforts may cost the Company
not only out of pocket expenses for its management but also expenses associated
with legal and accounting cost. There can be no guarantee that the Company will
receive any benefits from the efforts of management to locate business
opportunities.
The Company has had no employees since its inception and does not
intend to employ anyone in the future, unless its present business operations
were to change. The president of the Company is providing the Company with a
location for its offices on a "rent free basis." The Company is not paying
salaries or other form of compensation to the officer or director of the Company
for his time and effort. The Company does intend to reimburse its officer and
director for out of pocket cost.
RESULTS OF OPERATIONS
The Company has not had any operations during the fiscal year ended
December 31, 1998, and has not had any operations since its incorporation. The
Company's only operations to date have involved the preliminary investigation of
one or more potential business opportunities, none of which have come to
fruition.
IMPACT OF THE YEAR 2000 ISSUE
The "Year 2000 problem" arose because many existing computer programs
use only the last two digits to refer to a year. Therefore, these computer
programs do not properly recognize a year that begins with "20" instead of the
familiar "19". If not corrected, many computer applications could fail or create
erroneous results. The extent of the potential impact of the Year 2000 problem
is not yet known, and if not timely corrected, it could affect the global
economy.
4
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The Company currently has no operations that require computers or
dealing with other entities who use computers. Therefore, at the present time,
the Company believes the issue will not adversely affect the Company. In the
future, the Company intends to address the issue in more detail, if business
circumstances require additional attention.
ITEM 8. FINANCIAL STATEMENTS
The financial statements of the Company are set forth immediately
following the signature page to this form 10-KSB.
5
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Company has had no disagreements with its certified public
accountants with respect to accounting practices or procedures or financial
disclosure.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
The following table sets forth as of March 29, 1999, the name, age, and
position of the Company's sole officer and director.
Name Age Position Director or Officer Since
W. Reed Jensen 57 President and 1997
Director
Set forth below is certain biographical information regarding the
Company's executive officer and director.
Mr. Jensen has been an accountant for the past thirty-one years. Mr. Jensen
is currently controller of the Metropolitan Water District of Salt Lake City.
Mr. Jensen received his bachelor degree in accounting from the University of
Utah in 1967.
To the knowledge of management, during the past five years, no present
director, or executive officer of the Company:
(1)filed a petition under the federal bankruptcy laws or any
state insolvency law, nor had a receiver, fiscal agent or similar
officer appointed by a court for the business or property of such
person, or any partnership in which he was a general partner at or
within two years before the time of such filing, or any corporation or
business association of which he was an executive officer at or within
two years before the time of such filing;
(2)was convicted in a criminal proceeding or named subject of
a pending criminal proceeding (excluding traffic violations and other
minor offenses);
(3)was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining him from or
otherwise limiting, the following activities:
(i) acting as a futures commission merchant,
introducing broker, commodity trading advisor, commodity pool
operator, floor broker, leverage transaction merchant,
associated person of any of the foregoing, or as an investment
advisor, underwriter, broker or dealer in securities, or as an
affiliate person, director or employee of any investment
company, or engaging in or continuing any conduct or practice
in connection with such activity;
(ii) engaging in any type of business practice; or
(iii)engaging in any activity in connection with the
purchase or sale of any security or commodity or in connection
with any violation of federal or state securities laws or
federal commodities laws;
(4) was the subject of any order, judgment, or decree, not
subsequently reversed, suspended, or vacated, of any federal or state
authority barring, suspending, or otherwise
6
<PAGE>
limiting for more than 60 days the right of such person to engage in
any activity described above under this Item, or to be associated with
persons engaged in any such activity;
(5) was found by a court of competent jurisdiction in a civil
action or by the Securities and Exchange Commission to have violated
any federal or state securities law, and the judgment in such civil
action or finding by the Securities and Exchange Commission has not
been subsequently reversed, suspended, or vacated.
(6) was found by a court of competent jurisdiction in a civil
action or by the Commodity Futures Trading Commission to have violated
any federal commodities law, and the judgment in such civil action or
finding by the Commodity Futures Trading Commission has not been
subsequently reversed, suspended or vacated.
The individuals and companies who controlled the Company prior to its
new management have had legal problems in the past. (Please see the Company's
1996 Form 10-K).
KEY CONSULTANT
The Company and Mr. Jensen have relied, and will continue to rely, on the
advice and consultation of Mark Peterson as to the future direction of the
Company. Investors in the Company should consider Mr. Peterson as an individual
who will exercise significant influence on any potential business merger or
acquisition. Although Mr. Peterson does not currently own shares of the
Company's Common Stock, he has indicated a desire to acquire shares in the
future. Mr. Peterson is an owner and president of Alpine Securities Corporation
located in Salt Lake City, Utah.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
The Company is not subject to the requirements of Section 16(a) of the
Exchange Act.
7
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ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following tables set forth certain summary information concerning
the compensation paid or accrued for each of the Company's last three completed
fiscal years to the Company's or its principal subsidiaries chief executive
officer and each of its other executive officers that received compensation in
excess of $100,000 during such period (as determined at December 31, 1998, the
end of the Company's last completed fiscal year):
<TABLE>
<CAPTION>
Annual Compensation Long-term Compensation
Other Restricted
Name and Annual Stock Options LTIP All other
Principal Position Year Salary Bonus ($) Compensation Awards /SARs Payout Compensation
- ------------------------- ------ ----------- ------------- --------- --------- --------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
W. Reed Jensen 1998 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
President, CEO
Krista Nielson
(former President) 1998 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
</TABLE>
Cash Compensation
There was no cash compensation paid to any director or executive
officer of the Company during the fiscal years ended December 31, 1998, 1997,
and 1996.
Bonuses and Deferred Compensation: None.
Compensation Pursuant to Plans: None.
Pension Table: None.
Other Compensation: None.
Compensation of Directors: None.
Termination of Employment and Change of Control Arrangement:
There are no compensatory plans or arrangements, including payments to
be received from the Company, with respect to any person named in Cash
Compensation set out above which would in any way result in payments to any such
person because of his resignation, retirement, or other termination of such
person's employment with the Company or its subsidiaries, or any change in
control of the Company, or a change in the person's responsibilities following a
changing in control of the Company.
8
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth as of March 31, 1999, the name and the
number of shares of the Company's Common Stock, par value $0.001 per share, held
of record or beneficially by each person who held of record, or was known by the
Company to own beneficially, more than 5% of the 6,000,000 issued and
outstanding shares of the Company's Common Stock, and the name and shareholdings
of each director and of all officers and directors as a group.
<TABLE>
<CAPTION>
Title Amount and
of Name of Nature of Percentage
Class Beneficial Owner Beneficial Ownership(1) of Class
----- ---------------- ----------------------- --------
<S> <C> <C> <C>
Common Stacey J. Hansen(2)
2625 Solar Circle #30
Salt Lake City, Utah 84124 1,000,000(D) 16.67%
Common Kellee J. Chase(2)
6730 Morro Street
Salt Lake City, Utah 84121 500,000(D) 8.33%
Common Scott R. Jensen(2)
1094 Sirmingo Way
Riverton, Utah 84065 500,000(D) 8.33%
Common Brent T. Jensen(2)
1528 W. Page
Gilbert, Arizona 85233 500,000(D) 8.33%
Common W. Reed Jensen(2)
4348 Butternut Road
Salt Lake City, Utah 84124 2,500,000(D) 41.67%
OFFICERS, DIRECTORS AND NOMINEES:
Common W. Reed Jensen ----------See Above----------
All Officers
and Directors
as a Group (1 person) 2,500,000 41.67%
</TABLE>
(1) Indirect and Direct ownership are referenced by an "I" or "D",
respectively. All shares owned directly are owned beneficially and of
record and such shareholder has sole voting, investment, and dispositive
power, unless otherwise noted.
(2) Stacey J. Hansen, Kellee J. Chase, Scott R. Jensen and Brent T. Jensen are
the adult children of W. Reed Jensen. Mr. Jensen denies any beneficial
ownership in his children's shares.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS WITH
MANAGEMENT AND OTHERS.
During the fiscal year ended December 31, 1998, there were no material
transactions, or series of similar transactions, since the beginning of the
Company's last fiscal year, or any currently proposed transactions, or series of
similar transactions, to which the Company was or is to be party, in which the
amount involved exceeds $60,000, and in which any director or executive officer,
or any security holder who is known by the Company to own of record or
beneficially more than 5% of any class of the Company's common stock, or any
member of the immediate family of any of the foregoing persons, has an interest.
CERTAIN BUSINESS RELATIONSHIPS
During the fiscal year ended December 31, 1998, there were no material
transactions between the Company and its management or principal shareholders.
9
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INDEBTEDNESS OF MANAGEMENT
There were no material transactions, or series of similar transactions,
since the beginning of the Company's last fiscal year, or any currently proposed
transactions, or series of similar transactions, to which the Company was or is
to be a party, in which the amount involved exceeds $60,000 and in which any
director or executive officer, or any security holder who is known to the
Company to own of record or beneficially more than 5% of any class of the
Company's common stock, or any member of the immediate family of any of the
foregoing persons, has an interest.
TRANSACTIONS WITH PROMOTERS
The Company was organized more than five years ago; hence transactions
between the Company and its promoters or founders are not deemed to be material.
PART IV
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
(a)(1)FINANCIAL STATEMENTS. The following financial statements are included in
this report:
Title of Document Page
Report of Smith & Company, Certified Public Accountants F-1
Balance Sheet as of December 31, 1998 F-2
Statements of Operations for the fiscal years ended December
31, 1998 and 1997 and from inception F-3
Statements of Stockholders' Equity for the years ended
December 31, 1998 and 1997 and from inception F-4
Statements of Cash Flows for the fiscal years ended
December 31, 1998 and 1997 and from inception F-5
Notes to Financial Statements F-6
(a)(2)FINANCIAL STATEMENT SCHEDULES. The following financial statement schedules
are included as part of this report: None.
(a)(3)EXHIBITS. The following exhibits are included as part of this report:
SEC
Exhibit Reference
Number Number Title of Document Location
Item 3 Articles of Incorporation and Bylaws
3.01 3 Articles of Amendment to
the Articles of Incorporation Incorporation
by reference*
3.02 3 Articles of Incorporation Incorporated
by reference*
3.03 3 Bylaws Incorporated
by reference*
Item 4 Instruments Defining the Rights of Security Holders
4.01 4 Specimen Stock Certificate Incorporated
by reference*
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* Incorporated by reference from the Company's registration statement on form
S-18 filed with the Commission, SEC file no. 33-55254.
(b) Reports on Form 8-K: None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated:
Ultronics Corporation
Date: April 12, 1999 By:
W. Reed Jensen
President and Director
(Principal Executive Officer)
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SMITH & COMPANY
A PROFESSIONAL CORPORATION OF
CERTIFIED PUBLIC ACCOUNTANTS
MEMBERS OF: 10 WEST 100 SOUTH, SUITE 700
AMERICAN INSTITUTE OF SALT LAKE CITY, UTAH 84101
CERTIFIED PUBLIC ACCOUNTANTS TELEPHONE: (801) 575-8297
UTAH ASSOCIATION OF FACSIMILE: (801) 575-8306
CERTIFIED PUBLIC ACCOUNTANTS E-MAIL: [email protected]
- --------------------------------------------------------------------------------
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Ultronics Corporation (A Development Stage Company)
We have audited the accompanying balance sheet of Ultronics Corporation (a
development stage company) as of December 31, 1998, and the related statements
of operations, changes in stockholders' equity, and cash flows for the years
ended December 31, 1998 and 1997 and for the period of March 14, 1990 (date of
inception) to December 31, 1998. 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 Ultronics Corporation (a
development stage company) as of December 31, 1998 and the results of its
operations, changes in stockholders' equity, and its cash flows for the years
ended December 31, 1998 and 1997, and for the period of March 14, 1990 (date of
inception) to December 31, 1998 in conformity with generally accepted accounting
principles.
/s/ Smith & Company
CERTIFIED PUBLIC ACCOUNTANTS
March 31, 1999
Salt Lake City, Utah
F-1
<PAGE>
ULTRONICS CORPORATION
(A Development Stage Company)
BALANCE SHEET
December 31, 1998
<TABLE>
<CAPTION>
1998
-----------------
ASSETS
CURRENT ASSETS
<S> <C>
Cash in bank $ 17,643
-----------------
TOTAL CURRENT ASSETS 17,643
-----------------
$ 17,643
=================
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accounts payable $ 0
-----------------
TOTAL CURRENT LIABILITIES 0
STOCKHOLDERS' EQUITY
Common Stock $.001 par value:
Authorized - 25,000,000 shares
Issued and outstanding 6,000,000 shares 6,000
Additional paid-in capital 20,000
Deficit accumulated during the development stage (8,357)
-----------------
TOTAL STOCKHOLDERS' EQUITY 17,643
-----------------
$ 17,643
=================
</TABLE>
See Notes to Financial Statements.
F-2
<PAGE>
ULTRONICS CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS
Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
3/14/90
(Date of
inception) to
1998 1997 12/31/98
----------- ----------- ------------------
<S> <C> <C> <C>
Net sales $ 0 $ 0 $ 0
Cost of sales 0 0 0
----------- ----------- ------------------
GROSS PROFIT 0 0 0
General & administrative
expenses 4,734 2,623 8,357
----------- ----------- ------------------
NET LOSS $ (4,734) $ (2,623) $ (8,357)
=========== =========== ==================
Net income (loss) per weighted average share $ .00 $ .00
=========== ===========
Weighted average number of common shares
used to compute net income (loss) per
weighted average share 6,000,000 1,260,274
=========== ===========
</TABLE>
See Notes to Financial Statements.
F-3
<PAGE>
ULTRONICS CORPORATION
(A Development Stage Company)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional During
Par Value $0.001 Paid-in Development
Shares Amount Capital Stage
-------------- -------------- ----------------- ---------------
Balances at 3/14/90
<S> <C> <C> <C>
(Date of inception) 0 $ 0 $ $ 0
Issuance of common
stock (restricted)
at $.001 per share
at 3/14/90 1,000,000 1,000 0
Net loss for period (1,000)
-------------- -------------- ----------------- ---------------
Balances at 12/31/90 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/91 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/92 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/93 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/94 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/95 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/96 1,000,000 1,000 (1,000)
Net income for year 0
-------------- -------------- ----------------- --------------
Balances at 12/31/96 1,000,000 1,000 (1,000)
Issuance of common stock
at $.005 per share at
12/12/97 5,000,000 5,000 20,000
Net loss for year (2,623)
-------------- -------------- ----------------- --------------
Balances at 12/31/97 6,000,000 6,000 20,000 (3,623)
Net loss for year (4,734)
-------------- -------------- ----------------- ---------------
Balances at 12/31/98 6,000,000 $ 6,000 $ 20,000 $ (8,357)
============== ============== ================= ==============
</TABLE>
See Notes to Financial Statements.
F-4
<PAGE>
ULTRONICS CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
3/14/90
(Date of
inception) to
1998 1997 12/31/98
-------------- -------------- --------------
OPERATING ACTIVITIES
<S> <C> <C> <C>
Net income (loss) $ (4,734) $ (2,623) $ (8,357)
Adjustments to reconcile net income (loss) to
cash used by operating activities:
Increase (Decrease) in accounts payable (2,623) 2,623 0
-------------- -------------- --------------
NET CASH USED BY
OPERATING ACTIVITIES (7,357) 0 (8,357)
INVESTING ACTIVITIES 0 0 0
-------------- -------------- --------------
NET CASH USED BY
INVESTING ACTIVITIES 0 0 0
FINANCING ACTIVITIES
Proceeds from sale of common stock 0 25,000 26,000
-------------- -------------- --------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 0 25,000 26,000
-------------- -------------- --------------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (7,357) 25,000 17,643
Cash and cash equivalents at beginning of year 25,000 0 0
-------------- -------------- --------------
CASH & CASH EQUIVALENTS
AT END OF YEAR $ 17,643 $ 25,000 $ 17,643
============== ============== ==============
</TABLE>
See Notes to Financial Statements.
F-5
<PAGE>
ULTRONICS CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 1998
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
Accounting Methods
The Company recognizes income and expenses based on the accrual method
of accounting.
Dividend Policy:
The Company has not yet adopted any policy regarding payment of
dividends.
Income Taxes:
The Company records the income tax effect of transactions in the same
year that the transactions enter into the determination of income,
regardless of when the transactions are recognized for tax purposes.
Tax credits are recorded in the year realized. Since the Company has
not yet realized income as of the date of this report, no provision for
income taxes has been made.
In February, 1992, the Financial Accounting Standards Board adopted
Statement of Financial Accounting Standards No. 109, Accounting for
Income Taxes, which supersedes substantially all existing authoritative
literature for accounting for income taxes and requires deferred tax
balances to be adjusted to reflect the tax rates in effect when those
amounts are expected to become payable or refundable. The Statement was
applied in the Company's financial statements for the fiscal year
commencing January 1, 1993.
At December 31, 1998 a deferred tax asset has not been recorded due to
the Company's lack of operations to provide income to use the net
operating loss carryovers of $8,357 which will expire between December
31, 2005 and 2019.
NOTE 2: DEVELOPMENT STAGE COMPANY
The Company was incorporated under the laws of the State of Nevada on
March 14, 1990 and has been in the development stage since
incorporation.
NOTE 3: CAPITALIZATION
On the date of incorporation, the Company sold 1,000,000 shares of its
common stock to Capital General Corporation for $1,000 cash, for an
average consideration of $.001 per share. On December 12, 1997, the
Company sold 5,000,000 shares of its common stock to five individuals
for $25,000, for average consideration of $.005 per share. The
Company's authorized stock includes 25,000,000 shares of common stock
at $.001 par value.
NOTE 4: RELATED PARTY TRANSACTIONS
The Company neither owns or leases any real property. Office services
are provided, without charge, by a Company officer. Such costs are
immaterial to the financial statements, and, accordingly, have not been
reflected therein. The officer and director of the Company is involved
in other business activities and may, in the future, become involved in
other business opportunities. If a specific business opportunity
becomes available, such person may face a conflict in selecting between
the Company and his other business interests. The Company has not
formulated a policy for the resolution of such conflicts.
F-6
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<LEGEND>
This schedule contains summary financial information extracted from
Ultronics Corporation December 31, 1998 financial statements and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000894556
<NAME> Ultronics Corporation
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