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: March 31, 2000.
____ Transition Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the Transition Period From ____ to ____
Commission file number: 0-24930
CTD HOLDINGS, INC.
f/k/a Cyclodextrin Technologies Development, Inc.
(Exact name of registrant as specified in its charter)
Florida 59-3029743
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
3713 S.W. 42nd Avenue, Suite 3, Gainesville, Florida, 32608-6581
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: 352-375-6822
Former name, former address and former fiscal year, if changed since last
report: N/A.
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 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
Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15 (d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. No.
Applicable only to corporate issuers
As of May 1, 2000, the Company had 3,655,240 outstanding shares of its common
stock.
Transitional Small Business Disclosure Format
(Check One):
No.
<PAGE>
F-1
<PAGE>
PART I: Financial Information
CTD HOLDINGS, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
March 31, 2000
--------------
<S> <C>
CURRENT ASSETS
Cash and cash equivalents $ 1,313
Accounts receivable 132,430
Inventory 67,189
Current portion of notes receivable 16,350
Deferred tax asset 15,000
Other current assets 42,520
--------
Total current assets 274,802
--------
Property and equipment, net 349,989
--------
OTHER ASSETS
Deferred tax asset 180,000
Notes receivable, less current portion 12,382
Intangibles, net 27,372
--------
Total other assets 219,754
--------
TOTAL ASSETS 844,545
========
</TABLE>
(Continued)
F-2
<PAGE>
CTD HOLDINGS, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
(Concluded)
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, 2000
--------------
<S> <C>
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 106,323
Current portion of long-term debt 23,920
Line of credit 5,484
Due to shareholder 3,221
---------
Total current liabilities $ 158,948
---------
Long-term debt, less current portion 181,108
---------
STOCKHOLDERS' EQUITY
Class A common stock, par value $.0001 per share,
9,900,000 shares authorized, 3,615,220 shares
issued and outstanding 361
Class B non-voting common stock, per value $.0001
per share, 10,000,000 shares authorized, 0 shares
issued and outstanding
Additional paid-in capital 1,823,540
Accumulated deficit (1,319,412)
-----------
Total stockholders' equity 504,489
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 844,545
==========
</TABLE>
See Accompanying Notesto Financial Statements.
F-3
<PAGE>
CTD HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-----------------------------
2000 1999
-------------- ------------
<S> <C> <C>
PRODUCT SALES $ 181,549 $ 92,130
COST OF PRODUCTS SOLD 52,209 12,273
---------- ---------
GROSS PROFIT 129,340 79,857
CONSULTING SERVICES AND OTHER OPERATING REVENUE 200 6,500
-------- ---------
TOTAL OPERATING REVENUE 129,540 86,357
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 143,183 114,173
---------- ---------
LOSS FROM OPERATIONS (13,643) (27,816)
---------- ---------
OTHER INCOME (EXPENSE)
Investment and other income (loss) 80 (3,078)
Interest expense (6,288) (266)
--------- ---------
Total other income (expense) (6,208) (3,344)
--------- ---------
NET LOSS (19,851) (31,160)
========= =========
NET LOSS PER COMMON SHARE $ (.01) $ (.01)
========= =========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 3,481,154 2,983,168
========== ==========
</TABLE>
See Accompanying Notes to Financial Statements.
F-4
<PAGE>
CTD HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------------
2000 1999
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (19,851) $ (31,160)
------------ ------------
Adjustments to reconcile net loss to
net cash used for operating activities:
Depreciation and amortization 5,181 2,158
Loss on sale of investments - 3,122
Stock issued for services - 23,656
(Increase)in accounts receivable (111,166) (51,185)
Decrease (increase) in inventory 18,060 (4,788)
Decrease (increase) in other current assets 3,501 (532)
Increase in accounts payable and
accrued expenses 47,558 31,517
--------- ----------
Total adjustments (36,866) 3,948
---------- ----------
NET CASH USED FOR OPERATING
ACTIVITIES (56,717) (27,212)
--------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment and leasehold improvements (22,746) -
Repayment of employee loan 7,257 -
Proceeds from sale of investment - 10,261
---------- ----------
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES (15,489) 10,261
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Stock subscription received - 25,000
Net proceeds from line-of-credit 12,190 -
Payment on notes payable (5,367) -
Payment to stockholder on loan (6,729) -
------------ ------------
NET CASH PROVIDED BY FINANCING
ACTIVITIES 94 25,000
------------ ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (72,112) 8,049
CASH AND CASH EQUIVALENTS, beginning of period 73,425 36,883
------------ ------------
CASH AND CASH EQUIVALENTS, end of period $ 1,313 $ 44,932
========= =========
</TABLE>
(Continued)
F-5
<PAGE>
CTD HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
(Unaudited)
(Concluded)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------------
2000 1999
------------ ------------
<S> <C> <C>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for interest $ 6,288 $ 266
============ ============
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND
FINANCING ACTIVITIES
2000 1999
--------- --------
Stock issued to officer in
satisfaction of bonus accrued $ 7,800 $ -
======== =========
Stock issued to consultant for
prepaid public relations services $ 40,000 $ -
========= =========
Stock issued for rights to
intellectual property $ 10,000 $ -
========= =========
</TABLE>
See Accompanying Notes to Financial Statements.
F-6
<PAGE>
CTD HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(Unaudited)
The information presented herein as of March 31, 2000, and for the three months
ended March 31, 2000 and 1999, is unaudited.
(1) BASIS OF PRESENTATION:
The accompanying financial statements include CTD Holdings, Inc. and its
subsidiaries, formerly known as Cyclodextrin Technologies Development, Inc.
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB and Rule 10-01 of Regulations S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal required
adjustments) considered necessary for a fair presentation have been included.
Operating results for the three month period ended March 31, 2000, are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2000. For further information, refer to the financial statements
and footnotes thereto included in the Company's annual report of Form 10-KSB for
the year ended December 31, 1999.
F-7
<PAGE>
CTD HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(Unaudited)
(2) PRIVATE PLACEMENT OF STOCK:
Beginning in 1999, the Company began offering a total of 1,300,000 shares of
common stock under a private placement memorandum to expire April 30, 2000. In
1999, 40,000 shares were sold for $15,000, less direct offering costs of $5,279.
In 1999, the Company also sold 140,000 of common stock for $35,000. No
additional amounts were sold during the three months ended March 31, 2000.
(3) NET LOSS PER COMMON SHARE:
Net loss per common share is computed in accordance with the new requirements of
Statement of Financial Accounting Standards No. 128 (SFAS 128) at March 31, 2000
and 1999. SFAS 128 requires net loss per share information to be computed using
a simple weighted average of common shares outstanding during the periods
presented. SFAS 128 eliminated the previous requirement that earnings per share
include the effect of any dilutive common stock equivalents in the calculation.
Common shares outstanding do not include common stock subject to repurchase.
(4) COMMITMENTS AND CONTINGENCIES:
In February 2000, the Company entered into a construction contract to build two
additional mushroom growing houses for $55,510. As of March 31, 2000, no amounts
were due under the contract.
On March 1, 2000, the Company entered into a one year public relation contract
with a consultant. The Company issued the consultant 200,000 shares of common
stock. The Company valued the shares at $40,000, approximately 50% less than the
bid price on the contract date. The Company recorded a prepaid asset of $40,000,
which is being amortized over one year, the life of the contract.
F-8
<PAGE>
CTD HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(Unaudited)
(5) CORPORATE CHANGES:
In April 2000, the Company changed its name to CTD Holdings, Inc. from
Cyclodextrin Technologies Development, Inc.
Also in April 2000, the Company effected a 2 for 1 stock split of its
outstanding common stock.
The accompanying financial statements and notes have been restated for all
periods presented to reflect these changes.
(6) SEGMENTS:
During the second quarter of 1999, the Company began cultivating exotic
mushrooms and herbs. The Company now has two segments, Cyclodextrin products and
mushroom products. Total assets related to the certified organic farm were
approximately $ 320,000 at March 31, 2000. For the three months ended March 31,
2000, sales of mushrooms were approximately $ 7,400 and loss from operations was
approximately $ 81,000.
F-9
<PAGE>
Item 2. Management Discussion and Analysis or Plan of Operation
(MD&A) Management Discussion & Analysis
As of 3/31/00
CTD Holdings, Inc.
Management Discussion and Analysis
Liquidity and Capital Resources
As of March 31, 2000, the Company's working capital was $115,854 compared to
$120,186 at December 31, 1999. This small decrease ($4,332) only attains
significance when considered from the perspective of the Company's large
increase in revenues. While small, it is a reminder to management about the
significance of the Company's investment in NSME.
Total product sales increased during the first quarter of 2000 by $89,419 (97%)
compared to the first quarter of 1999. This increase in sales is due to the
usual sales volatility as historically experienced by the Company, but also to
expanding uses for cyclodextrin. Selling, General and Administrative expenses
(SG&A) increased
$29,010 due principally to the continuing start-up financial needs of NSME.
Inventory levels are higher than a year ago, but slightly decreased from the end
of 1999 indicating the Company's build up to handle increased sales and the drop
as sales occurred in the first quarter.
The Company has begun an analytical study of the ingredients in its Shiitake and
Maitake mushrooms. The goal of these studies is to prove the existence in these
extracts of certain natural ingredients that are known to have medicinal
properties. From that point, complexes with CD's will be made and clinical
trials will be started, contingent on the availability of the necessary funds.
The Company is in the first year of a two year extension of its lease for its
existing 3000 square-foot office and lab facility. Rent for the space remains at
just under $2000 per month. The Company hopes to move from this facility into
the building on its newly purchased property some time in the third quarter of
this year. The timing of that move will depend on the availability / allocation
of funds necessary to complete the necessary renovations. The Company intends to
sublet its existing space when that move is completed, certainly before the end
of the two year extension, November, 2001.
In keeping with its commitment to use the Internet as its major advertising and
public relations outlet, the Company has entered into a 5 month agreement with
its current, local ISP and Web Site managing company, Livewire, to significantly
upgrade its current Web Site. The Company has budgeted $30,000 for this upgrade,
which includes substantial cosmetic and operational alterations and expansion of
the revenue producing databases.
In early May of this year, the Company responded to increased demand for its
stock by authorizing and implementing a 2 for 1 forward split of its common
stock (May 1 - date of record; May 20 - pay date; May 22 - execute date).
Management believes that this action is a good way to begin to alleviate the
mechanical trading problem of too small a float in the market of its common
stock. Management believes that an increase in the Company's market
capitalization will enhance the probability of the Company's success in
acquiring other companies, implementing one part of its strategic plan to file
for NASDAQ listing in the fourth quarter of this year.
To further enhance the successful implementation of its strategic plan, the
Company changed the name of Cyclodextrin Technologies Development Inc. (CTD) to
CTD Holdings, Inc. (CTDH). The operations of the previous Cyclodextrin
Technologies Development, Inc. will be transferred into a wholly owned
subsidiary of CTDH, called Cyclodextrin Technologies Development Inc. NSME will
remain a subsidiary of CTDH. The joint venture with Ocumed, incorporated in
Florida as Ocudex, will also remain a wholly owned subsidiary of CTDH. This
Holding company structure will facilitate the legal implementation of future
acquisitions and stock transactions.
Results of Operations
Sales of cyclodextrin and related manufactured complexes are historically
highly volatile. In efforts to offset this volatility, the Company continues to
expand its revenue producing activities to include providing research and
development services for unrelated companies and its inventory line to include
more routinely purchased products. In addition the Company has created a
subsidiary that will provide products for the rapidly expanding $5 billion
natural medicinals industry, thereby diversifying its revenue base into a
greater number of manufactured products.
The Company has completed the start-up phase of its natural medicinals venture
at the newly acquired 40 acre farm in High Springs, FL. Through its wholly-owned
subsidiary, Natural Spirit Mushroom Enterprises, Inc. (NSME), the company has
successfully established
a growing sales base for its edible exotic mushrooms. In the first quarter NSME
sold more than $7,000 of Shiitake mushrooms utilizing two operating grow houses
to produce more than 3000 lbs of mushrooms. By the end of June NSME will bring
two more grow houses on line. The added capacity will allow the Company to
produce 10,000 lbs per month of mushrooms by the end of the year. Production
will include Maitake and Reishi mushrooms as well as Shiitake. Based on the
great demand for edible mushrooms that the Company is experiencing, management
believes quickly increasing growing capacity will be rewarded with much
increased sales.
In the first quarter, NSME produced a loss of almost $81,000 on sales just under
$7500. The Company was able to absorb this loss at the expense of overall
profitability; a situation that the Company intends to turn around by the end of
the third quarter. During the second quarter the Company expects to see
increased revenues from increased sales of mushrooms and new revenues from
NSME's other certified organic herbs and produce. At the same time, expense
reduction measures will be implemented. Management is still confident that NSME
can be producing net profit at the rate of $10,000 per month by the end of the
year.
Total product sales for the quarter ended March 31, 2000 were $ 181,549 compared
to $92,130 for the same period in 1999. Management expects the food industry's
interest in cyclodextrin to continue due to the Food and Drug Administration's
(FDA) announcement in 1998 that Beta cyclodextrin is now Generally Recognized As
Safe (GRAS) in certain food related applications.
Product sales are primarily to large pharmaceutical and food companies for
research and development purposes. Sales of both products and services have been
concentrated among a few large customers.
The Company's gross profit margin on product sales decreased from 87% to 71% for
the first quarter of 1999 and 2000, respectively. The magnitude of the decrease
in gross profit margin is due to an unusual situation in the first quarter of
1999 that took advantage of an increase in sales of very high GPM products and
the inevitable erosion of prices for more routinely used CD's now being sold in
bulk quantities this year. Management expects GPM values for the Company to
stabilize between 70% and 80% in 2000.
Selling, general and administrative (SG&A) expenses for the first quarter 2000
($143,183 vs. $114,173) increased from the first quarter 1999. The largest
portion of this 27.5% increase was due to the increase in expenses to start up
and maintain the NSME operation including, added insurance expenses, increased
depreciation and amortization expenses, and increased loan costs. The Company
also upgraded its computers, incurred increased professional fees to hire new
employees and hired an Investor Relations company. Finally, one must expect some
natural increase in expenses required to support significant increases in sales.
While the increase is understandable, management intends to monitor these
changes even more fastidiously during this time of rapid growth by NSME.
The Company's net loss from operations for the three months ended March 31, 2000
was $19,851 versus $31,160 for the same period in 1999. The improvement in net
loss of $11,309 (36%) is not very comforting in view of the large increase in
revenue. While management is comfortable that expenses are being monitored
adequately, it feels increased pressure to minimize further expense increases to
insure profitability in the face of expected growing revenues. The Company will
continue to develop new products, and implement its strategy of creating
operational affiliates and/or subsidiaries that will use CD's in herbal
medicines, waste water remediation, and pharmaceuticals.
PART II: Other Information
Item 2. Changes in Securities and Use of Proceeds
On February 18, 2000, the Company issued 200,000 common shares to C.E. "Rick"
Strattan pursuant to a bonus authorized by the Board of Directors on November 3,
1999. On April 24, 2000, the Company issued 200,000 common shares to Randy
McAtee in consideration of his services provided in the Public Relations
Service Agreement entered into by the Company on March 1, 2000. On April 19,
2000, the Company issued 40,000 shares to George Fails in consideration of his
payment of $10,000 to the Company. All share certificates contained restricted
legends and were issued pursuant to exceptions from registration pursuant to
Section 4(2) of the Security Act inasmuch as all shares were sold in private
transactions.
Item 6. Exhibits and Reports on Form 8-K
None.
(a) Exhibits
Exhibit Description Page
(2) Plan of Acquisition, Reorganization, Arrangement,
Liquidation or Succession None
(4) Instruments defining the Rights of Security Holders None
(10) Material Contracts None
(10.1) Public Relations Service Agreement with Randy *
"Lazarus" McAtee, dated March 1, 2000
(11) Statement re: Computation of Per Share Earnings Note 8,
Financial
Statements
(15) Letter re: Unaudited Interim Financial Information None
(18) Letter re: Change in Accounting Principles None
(19) Report Furnished to Security Holders None
(22) Published Report re: Matters Submitted to Vote of
Security Holders None
(23) Consents of Experts and Counsel None
(24) Power of Attorney None
(27) Financial Data Schedule *
(99) Additional Exhibits None
(b) Reports on Form 8-K:
None
* Filed Herewith
<PAGE>
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Dated: May 6, 1999
/s/ C. E. RICK STRATTAN
-----------------------
C. E. RICK STRATTAN
President, Chief Executive Officer,
Chief Financial Officer
PUBLIC RELATIONS SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this 1st day of March,
2000, by and between RANDY "LAZARUS" McATEE d/b/a "SMALL POTATOES" (hereinafter
referred to as "Lazarus") and CYCLODEXTRIN TECHNOLOGIES DEVELOPMENT, INC.
(hereinafter referred to as "Client").
RECITALS:
A. Lazarus offers a variety of Internet and e-mail public
relations services designed to educate and inform individuals
and/or companies about Client's business and the investment
opportunity represented by an investment in Client's publicly
traded stock.
B. Client is a corporation with publicly traded stock.
C. Client desires to engage Lazarus for the purpose of having
Lazarus perform Internet and/or e-mail public relation
services to the end that individuals and companies become more
knowledgeable about Client, Client's business and the
opportunity presented by an investment in Client's publicly
traded stock.
NOW, THEREFORE, the parties agree as follows:
1. Client hereby engages Lazarus and Lazarus accepts such engagement
for the purpose of rendering Internet and/or e-mail public relations services as
described herein.
2. Lazarus is the web host of the "small potatoes" website
(www.smallpotatoes.net) and agrees to post information concerning Client,
Client's business and Client's publicly traded stock on the "Small Potatoes"
website. Lazarus further agrees to distribute a business profile of Client and
other business information concerning Client to individuals and companies
through and by way of an e-mail newsletter periodically published and
transmitted by Lazarus. Without limiting the generality of the foregoing,
Lazarus agrees to make a good faith effort to increase public awareness of
Client, Client's business and Client's stock by distributing accurate and
updated information by way of the "Small Potatoes" website and Lazarus's e-mail
newsletter.
3. Client agrees to provide Lazarus with accurate and timely
information concerning Client, Client's business and Client's stock. Client
acknowledges and is aware that Lazarus will rely upon the accuracy and
timeliness of all information provided to Lazarus by Client. Client agrees and
warrants that all information provided to Lazarus will be accurate in all
respects and will not in any way, directly or indirectly be misleading. Client
agrees and understands that any and all information provided to Lazarus may
become public information. Lazarus agrees that the Client's information posted
on his web site will be subject to the Client's attorney's review for purposes
of compliance with State and Federal Securities Laws and regulations and that if
Lazarus receives notice from the Client that any part of the posted information
is in violation of a law or regulation, that he will modify or remove that
information within one day of notification. Lazarus agrees to post with the
Client's information, a list of states in which viewers of the information may
not purchase securities of the Client.
4. Lazarus shall be compensated by Client as follows: On or before
March 16, 2000, Lazarus shall receive One Hundred Thousand (100,000) shares of
restricted stock of Client.
5. The term of this Agreement shall be twelve (12) calendar months
commencing March 13, 2000, and ending March 13, 2001. Lazarus shall perform the
services set forth in paragraph 2 above during the term of this Agreement and
only during the term of this Agreement. At the end of the term of this
Agreement, Lazarus shall remove all references to Client from the "Small
Potatoes" website. The Client may terminate this Agreement at any earlier time
upon written notice to Lazarus.
6. Client understands that this is a "best efforts" agreement and that
Lazarus makes no guarantee of any kind to Client. Client understands that
Lazarus is responsible for taking information provided by Lazarus by Client and
utilizing that portion of such information as Lazarus, in Lazarus's sole
discretion, may deem suitable for publication on the "Small Potatoes" website
and/or on Lazarus's e-mail newsletter. Client understands that Lazarus makes no
guarantees and/or recommendations to prospective investors in Client's stock,
that Lazarus does disclose and will disclose all compensation to be received by
Lazarus pursuant to this Agreement, that Lazarus will disclose that Lazarus is a
shareholder of Client and that Lazarus will make a best efforts and good faith
effort to increase public awareness of Client, Client's business and Client's
stock. Client further understands and acknowledges that Lazarus does not receive
payment from individuals viewing the "Small Potatoes" website nor does Lazarus
charge for Lazarus's e-mail newsletter. Lazarus agrees that he will comply with
all applicable federal, state and local regulations regarding the publication of
information on his website.
7. This Agreement shall be interpreted pursuant to the Laws of the
State of California. Should a dispute arise between the parties to this
Agreement, the parties hereto specifically acknowledge that jurisdiction shall
lie within the State of California and exclusive venue for any lawsuit shall lie
within Alachua County, Florida. In the event an action is brought for the
purpose of enforcing and/or interpreting this Agreement, the prevailing party in
any such action shall be entitled to such reasonable attorneys' fees and/or
court costs as the court hearing such action may award.
8. Notwithstanding any other provision of this Agreement, Client hereby
unconditionally guarantees the accuracy of any and all information provided to
Lazarus by Client. Client further acknowledges that any and all information
given to Lazarus pursuant to this Agreement is given to Lazarus with the
understanding that such information may be disclosed to the public information.
Client, therefore, agrees to give Lazarus any confidential insider information
not otherwise available or to be made immediately available to the public.
9. The person signing this Agreement on behalf of Client hereby
acknowledges that (s)he is authorized by Client to bind Client to this
Agreement.
10. The content of the "Small Potatoes" website is determined in the
sole discretion of Lazarus, excepting those provisions discussed above and
required by law. Client understands that mistakes or errors may occur and that
Lazarus agrees to utilize Lazarus's best efforts to correct any and all mistakes
when discovered. Lazarus, in the sole discretion of Lazarus, shall control the
timing within which the "Small Potatoes" website is updated and the timing of
releasing any and all e-mail newsletters. The parties hereto agree that nothing
in this Agreement will require Lazarus to divulge Lazarus's methods of
disseminating information and/or any trade secrets or mailing lists maintained
by Lazarus.
IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement on the date and year first above written.
LAZARUS: CLIENT:
/s/Randy McAttee
_______________________________ CYCLODEXTRIN TECHNOLOGIES
RANDY "LAZARUS" McATEE DEVELOPMENT, INC.
d/b/a "Small Potatoes"
/s/"C.E.Rick Strattan
By:___________________________
President/CEO
Title:________________________
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Financial Statements for the 3 months ended March 31, 2000, and is qualified in
its entirety by reference to such form 10QSB for three months ended March 31,
2000.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-START> JAN-01-2000
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 1,313
<SECURITIES> 0
<RECEIVABLES> 132,430
<ALLOWANCES> 0
<INVENTORY> 67,189
<CURRENT-ASSETS> 274,802
<PP&E> 437,917
<DEPRECIATION> 87,928
<TOTAL-ASSETS> 844,545
<CURRENT-LIABILITIES> 158,948
<BONDS> 0
<COMMON> 361
0
0
<OTHER-SE> 504,128
<TOTAL-LIABILITY-AND-EQUITY> 844,545
<SALES> 181,549
<TOTAL-REVENUES> 181,829
<CGS> 52,209
<TOTAL-COSTS> 195,392
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,288
<INCOME-PRETAX> (19,851)
<INCOME-TAX> 0
<INCOME-CONTINUING> (19,851)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (19,851)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
