UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-QSB
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(Mark one)
XX QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
- --------- EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2001
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
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For the transition period from __________ to __________
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Commission File Number: 33-22175
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Safetek International, Inc.
(Exact name of small business issuer as specified in its charter)
Delaware 75-2226896
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(State of incorporation) (IRS Employer ID Number)
5509 11th Avenue, Brooklyn, NY 11219
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(Address of principal executive offices)
(718) 436-8246
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(Issuer's telephone number)
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. YES X NO
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State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: June 30, 2001: 5,138,548
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Transitional Small Business Disclosure Format (check one): YES NO X
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SAFETEK INTERNATIONAL, INC.
Financial Statements For The Quarter Ended June 30, 2001
Table of Contents
Page
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Financial Information
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Financial Statements 3 - 5
Management's Discussion and Analysis of Plan of Operation 6 - 7
Other Information
Legal Proceedings 7
Changes in Securities 7
Defaults Upon Senior Securities 7
Other Information 7
Exhibits and Reports on Form 8-K 7
Signatures 8
2
SAFETEK INTERNATIONAL, INC.
AND SUBSIDIARIES
Consolidated Balance Sheets
June 30,
ASSETS 2001 December 31,
------ (Unaudited) 2000
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Current assets:
Cash and cash equivalents -- $ 1,883
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Total currentassets -- 1,883
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Intangible asset 450,000 --
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Total assets $ 450,000 $ 1,883
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
Accounts Payable and accrued expenses $ 100,000 $ 23,617
Due to affiliate 30,500 --
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Total current liabilities 130,500 23,617
Debenture Payable 378,650 --
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Total liabilities 509,150 23,617
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Redeemable Preferred Stock - 4,648 and 4,688 shares 124,171 125,239
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Stockholders' equity:
Common stock - 5,138,548 and 93,548 shares 514 9
Additional paid in capital 2,443,594 2,441,181
Accumulated deficit (2,627,429) (2,588,163)
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Total stockholders' deficit (183,321) (146,973)
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Total liabilities and stockholders' equity $ 450,000 $ 1,883
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See accompanying notes to financial statements
3
SAFETEK INTERNATIONAL, INC.
AND
SUBSIDIARIES
Consolidated Statements of Operations
Six Months Ended Three Months ended
June 30, June 30,
(unaudited) (unaudited)
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Revenues: 2001 2000 2001 2000
Net Sales $ 376 $ 16,855 -- $ 4,263
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Costs and expenses:
Cost of good sold -- 11,910 -- 3,436
Selling, general and administrative 59,285 102,583 53,359 45,581
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59,285 114,493 53,359 49,017
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Operating Loss (58,909) (97,638) (53,359) (44,754)
Other income (expense) 19,643 (18,702) -- --
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Net loss $ (39,266) $ (116,340) $ (53,359) $ (44,754)
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Basic and diluted loss per share $ (.06) $ (.003) $ (.04) $ (.001)
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Weighted average
number of shares outstanding 650,426 72,291 1,201,185 72,291
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See accompanying notes to financial statements
4
SAFETEK INTERNATIONAL, INC.
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Six Months Ended
June 30,
2001 2000
(unaudited) (unaudited)
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Cash flows from operating activities:
Net loss $ (39,266) $ (116,340)
Adjustments to reconcile Net income (loss) to net
Cash provided by (used in) operating activities:
Preferred stock issued -- 5,000
Other current assets -- 3,300
Due to stockholders -- 37,500
Accounts payable and accrued expenses 75,315 31,204
Due to affiliate 30,500 39,374
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Net cash provided by operating activities 66,549 38
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Cash Flows from investing activities:
Purchase of intangible asset (450,000) --
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Net cash used in investing activities (450,000) --
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Cash Flows from financing activities:
Proceeds from issuance of stock 2,918 --
Debenture payable 378,650 --
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Net Cash provided by financing activities 381,568 --
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Increase (decrease) in cash and cash equivalents (1,883) 38
Cash and cash equivalents - beginning of period 1,883 --
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Cash and cash equivalents - end of period $ -- $ 38
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See accompanying notes to financial statements
5
SAFETEK INTERNATIONAL, INC.
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2001
Part I
1. Presentation of Unaudited Consolidated Financial Statements
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The unaudited consolidated financial statements have been prepared in
accordance with rules of the Securities and Exchange Commission and,
therefore, do not include all information and footnotes necessary for a
fair presentation of financial position, results of operations and cash
flows, in conformity with generally accepted accounting principles. The
information furnished, in the opinion of management, reflects all
adjustments (consisting only of normal recurring accruals) necessary to
present fairly the financial position as of June 30, 2001, and results
of operations and cash flows for the three months and six months ended
June 30, 2001 and 2000. The results of operations are not necessarily
indicative of results, which may be expected for any other interim
period, or for the year as a whole.
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Caution Regarding Forward-Looking Information
This quarterly report contains certain forward-looking statements and
information relating to the company that are based on the beliefs of
the company or management as well as assumptions made by and
information currently available to the company or management. When used
in this document, the words "anticipate," "believe," "estimate,"
"expect" and "intend" and similar expressions, as they relate to the
company or its management, are intended to identify forward-looking
statements. Such statements reflect the current view of the company
regarding future events and are subject to certain risks, uncertainties
and assumptions, including the risks and uncertainties noted. Should
one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary
materially from those described herein as anticipated, believed,
estimated, expected or intended. In each instance, forward-looking
information should be considered in light of the accompanying
meaningful cautionary statements herein.
2. Financial Condition and Plan of Operations
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Safetek was reorganized in May 2001 for the purpose of providing
embryonic companies with good concepts and promising patented ideas,
presented to them by inventors with actual proof of concepts and
working prototypes, in order to bring these products to fruition.
As of the date of this filing, for the sum of $450,000 the company
acquired the contractual rights of Argo, Ltd. who has contracts with
Evo.Tech, Inc. ("Evo Tech") and Altira Capital Consulting LLC.
("Altira").
6
SAFETEK INTERNATIONAL, INC.
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (continued)
June 30, 2001
It is the belief of management that Evo Tech and Altira are well
established consultants in the field of evaluating the commercial
potential of newly evolving intellectual property, and that these two
firms also have the capability of building the sort of sophisticated
prototypes which enable the potential strengths and weaknesses of the
final product to be evaluated before actual production begins, and the
cost of commitment associated therewith is made.
3. Results of operation, Liquidity and Capital Resources
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For the Quarter ended June 30, 2001, the Company had virtually no
revenues. The contract of $450,000 mentioned above is the only asset of
the company. The liabilities of the company are mainly amounts due on
this contract and monies received from 8% series A Senior subordinated
convertible redeemable debentures to pay for this contract as well as
other expenses.
Part II. Other Information
1. Legal Proceedings - None
2. Changes in Securities:
Common Stock
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Number of Additional
Shares Par Value paid in capital
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Balance at December 31, 2000 93,548 9 2,441,181
Shares issued - June 2001 5,045,000 505 2,413
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Balance at June 30, 2001 5,138,548 514 2,443,594
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On June 11, 2001 a stock option plan was exercised and 5,000,000 shares
of common stock were bought at the par value.
3. Defaults on Senior Securities - None
4. Submission of Matters to a Vote of Security Holders
The company has held no regularly scheduled meetings during the
reporting period.
5. Other information - None
6. Exhibits and Reports on Form 8-K - None
7
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934.
this report has been signed below by the following persons in behalf of the
Registrant and in the capacities and on the dates indicated.
Shmuel M. Shneibalg, President and Director
By: /s/ Shmuel M. Shneibalg Dated: August 14, 2001
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Russell Machover, Vice President and Director
By: /s/ Russell Machover Dated: August 14, 2001
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