U. S. 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 quarter ended August 31, 2005
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
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Commission File No. 000-29603
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PROCESS TECHNOLOGY SYSTEMS, INC.
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(Name of Small Business Issuer in its Charter)
NEVADA 91-2070995
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(State or Other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6371 Richmond, #200
Houston, Texas 77057
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(Address of Principal Executive Offices)
Issuer's Telephone Number: (713) 266-8005
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PAST FIVE YEARS)
Not Applicable.
Check whether the Registrant has 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: Yes___No ___
Not Applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the Registrant's
classes of common equity, as of the latest practicable date:
August 31, 2005
Common - 2,000,000 shares
Preferred - 5,835 shares
DOCUMENTS INCORPORATED BY REFERENCE
None.
Transitional Small Business Issuer Format Yes X No
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Condensed Financial Statements of the Company required to be
filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes. In the opinion
of management, the Condensed Financial Statements fairly present the financial
condition of the Company.
PROCESS TECHNOLOGY SYSTEMS, INC.
(A Development Stage Company)
Condensed Financial Statements
August 31, 2005
PROCESS TECHNOLOGY SYSTEMS, INC.
(A Development Stage Company)
Condensed Balance Sheet
August 31, 2005
(Unaudited)
ASSETS
August 31, November 30,
2005 2004
(Unaudited) (Audited)
Current Assets
Cash and cash equivalents $ 0 $ 0
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Total Current Assets $ 0 $ 0
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Total Assets $ 0 $ 0
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LIABILITIES AND STOCKHOLDERS' DEFICIT
Liabilities
Current Liabilities
Accounts Payable $ 74,254 $ 51,467
Due to stockholder 947 2,035
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Total Current Liabilities 75,201 53,502
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Total Liabilities 75,201 53,502
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Stockholders' Deficit
Preferred stock: $.25 par value
Authorized 12,500,000
5,835 shares issued and outstanding 1,459 1,459
Common stock, $0.002 par value;
authorized 200,000,000 shares;
issued and outstanding 2,000,000 4,000 2,000
Additional paid-in capital 327,260 319,260
Deficit accumulated during development stage (407,920) (376,221)
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Total Stockholders' Deficit (75,201) (53,502)
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Total Liabilities and Stockholders' Deficit $ 0 $ 0
========= =========
See accompanying notes to the financial statements
1
PROCESS TECHNOLOGY SYSTEMS, INC.
(A Development Stage Company)
Condensed Statements of Operations
For the Three Months and Nine Months Ended August 31, 2005 and 2004 and from
Inception [May 12, 1987] through August 31, 2005
(Unaudited)
>From
Inception on
For the For the May 12, 1987
Three Months Ended Nine Months Ended Through
August 31, August 31, August 31,
2005 2004 2005 2004 2005
--------- -------- -------- ------- --------
Revenues $ 0 $ 0 $ 0 $ 0 $ 0
Expenses
General and
administrative 3,848 2,405 31,699 14,489 407,920
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Total Expenses 3,848 2,405 31,699 14,489 407,920
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Net Loss Before Income
Taxes $ (3,848) $ (2,405) $(31,699) $(14,489)$(407,920)
Provision for Income Taxes 0 0 0 0 0
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Net Loss $ (3,848) $ (2,405) $(31,699) $(14,489)$(407,920)
========= ======== ======== ======= ========
Loss Per Share $ (0.01) $ (0.01) $ (0.01) $ (0.01)
========= ======== ======== =======
Weighted Average Shares
Outstanding 2,000,000 1,000,000 1,461,538 1,000,000
========= ========= ========= =========
See accompanying notes to the financial statements
2
PROCESS TECHNOLOGY SYSTEMS, INC.
(A Development Stage Company)
Statements of Cash Flows
For the Three and Nine Months Ended August 31, 2005 and 2004 and from
inception [May 12, 1987] through August 31, 2005
(Unaudited)
>From
Inception on
For the For the May 12, 1987
Three Months Ended Nine Months Ended Through
August 31, August 31, August 31,
2005 2004 2005 2004 2005
Cash Flows From Operating
Activities
Net loss $ (3,848) $ (2,405) $(31,699) $(14,489) $(407,920)
Adjustments to reconcile net
(loss) to net cash provided
by operating activities:
Write off of assets 188,627
Common stock issued for
services 83,645
Increase (decrease) in
accounts payable (2,014) (1,350) 22,787 7,108 86,658
Increase (decrease) in
due to shareholders (4,138) (1,088) 948
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Net Cash From Operating
Activities (10,000) (3,755) (10,000) (7,381) (48,042)
--------- -------- -------- --------- ----------
Cash Flows From Financing
Activities
Common stock issued
for cash - - 10,000 - 17,142
Contributed capital - 3,755 - 7,381 30,900
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Net Cash From Financing
Activities - 3,755 10,000 7,381 48,042
Net Increase (Decrease)
in Cash (10,000) - - - -
Beginning Cash Balance 10,000 - - - -
--------- -------- -------- --------- ----------
Ending Cash Balance $ - $ - $ - $ - $ -
========= ======== ======== ========= ==========
Supplemental Disclosure Information
Cash paid during year for
interest $ 0 $ 0 $ 0 $ 0 $ 0
Cash paid during year for
income taxes $ 0 $ 0 $ 0 $ 0 $ 0
Issued Common Stock for
Debt $ 0 $ 0 $ 0 $ 0 $ 12,400
Issued Common Stock for
Services $ 0 $ 0 $ 0 $ 0 $ 83,645
See accompanying notes to the financial statements
3
PROCESS TECHNOLOGY SYSTEMS, INC
(A Development Stage Company)
Notes to Condensed Financial Statements
August 31, 2005
NOTE 1 BASIS OF PRESENTATION
The accompanying financial statements have been prepared without audit,
pursuant to the rules and regulations of the Security and Exchange
Commission. The interim financial statements reflect all adjustments
which, in the opinion of management, are necessary to present a fair
statement of the results for the period.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's
Annual Report on Form 10-KSB for the year ended November 30, 2004. The
results of operation for period ended August 31, 2005 are not
necessarily indicative of the operating results for the full years.
NOTE 2 - GOING CONCERN
The Company does not have significant assets, nor has it established
operations and has accumulated losses since inception. These factors
raise substantial doubt about the Company's ability to continue as a
going concern. It is the intent of the Company to seek a merger with an
existing, well-capitalized operating company. The financial statements
do not include any adjustments that might result from the outcome of
this uncertainty.
NOTE 3 RELATED PARTY PAYABLES
A majority shareholder has paid expenses on behalf of the Company.
During the period, a shareholder paid $2,703 on behalf of the Company.
$6,840 was reimbursed to the shareholder for previous payments the
shareholder paid on behalf of the Company.
NOTE 4 STOCK
On April 27, 2005, the Company issued 1,000,000 shares of common stock
at $0.01 per share for a total of $10,000.
4
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
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The Company has not engaged in any material operations or had any
revenues from operations during the last two fiscal years. The Company's
Board of Directors intends to examine various industries in which the Company
may conduct business operations, and then adopt a Business Plan detailing the
necessary capital and requirements to engage in that industry.
During the next 12 months, the Company's only foreseeable cash
requirements will relate to maintaining the Company in good standing, which
may be advanced by management or principal stockholders as loans to the
Company. Any such sums should be nominal.
Item 3. Controls and Procedures.
As of the end of the period covered by this Quarterly Report, we
carried out an evaluation, under the supervision and with the participation of
our President and Secretary/Treasurer, of the effectiveness of the design and
operation of our disclosure controls and procedures. Based on this
evaluation, our President and Chief Financial Officer concluded that our
disclosure controls and procedures are effectively designed to ensure that
information required to be disclosed or filed by us is recorded, processed or
summarized, within the time periods specified in the rules and regulations of
the Securities and Exchange Commission. It should be noted that the design of
any system of controls is based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future
conditions, regardless of how remote. In addition, we reviewed our internal
controls, and there have been no significant changes in our internal controls
or in other factors that could significantly affect those controls subsequent
to the date of their last evaluation.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On April 27, 2005, the Company issued 1,000,000 shares of common
stock ("restricted securities") to seventeen (17) investors pursuant to
Subscription Agreements at $0.01 per share for an aggregate total of $10,000
or $0.01 per share.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5. Other Information.
Effective June 2, 2005, we amended our Articles of Incorporation.
These amendments increased our authorized shares; allowed the Board of
Directors, without shareholder approval, to effect re-capitalizations in the
form of forward and reverse splits of our outstanding securities, provided
that any such re-capitalization does not require a further amendment to our
Articles of Incorporation; and added a provision that summarizes the
indemnification provisions of the General Corporation Law of the State of
Nevada ("Nevada Law"). See our Definitive Information Statement that was
filed with the Securities and Exchange Commission on May 13, 2005, and mailed
to our stockholders on that date and which is incorporated herein by
reference. See Item 6.
On October 15, 2005, we executed a Letter of Intent with Forster
Drilling Corporation. Forster is engaged in the contract land drilling
service sector of the oil and exploration and production business. See our 8-
K Current Report dated and filed with the Securities and Exchange Commission
on October 14, 2005, and which is incorporated herein by reference. See Item
6.
Item 6. Exhibits.
31.1 302 Certification of William A. Silvey, Jr.
31.2 302 Certification of W. Scott Thompson
32 Section 906 Certification.
Definitive Information Statement dated May 13, 2005*
8-K Current Report dated October 14, 2005*
*Incorporated herein by reference.
SIGNATURES
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.
PROCESS TECHNOLOGY SYSTEMS, INC.
Date: 10/17/2005 By /s/William A. Silvey, Jr.
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William A. Silvey, Jr., Director
and President
Date: 10/17/2005 By /s/W. Scott Thompson
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W. Scott Thompson, Director
Secretary
Date: 10/17/2005 By /s/Bud Najvar
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Bud Najvar, Director