As filed with the U.S. Securities and
Exchange Commission on February 29, 2000

Registration No. 333-40001-NY

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

AMENDMENT NO. 5 TO
FORM SB-2

Registration Statement

Under The Securities Act of 1933

New Jersey 2899 223-319-224
State of Standard Industrial IRS Employer
Incorporation Classification Code Identification No.

PPA TECHNOLOGIES, INC.
163 South St.
Hackensack, New Jersey 07601
(201) 457-1221

Address, including zip code and telephone number, including area code of
registrant's principal executive offices and principal place of business or
intended principal place of business.

ROGER L. FIDLER
163 South St.
Hackensack, New Jersey 07601
(Name and Address of Agent for Service)
Copies of Communication to:

Jay Hait, Attorney at Law,
130 William St., Suite 807, New York, NY 10038 (212)349-0124

Steve Gutstein, Esq., Attorney at Law,
276 Fifth Avenue, New York, New York 10001

Approximate date of proposed sale to public: As soon as possible after the
effective date of the Registration Statement.

CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
Title of Amount to be Proposed maximum Proposed maximum Amount
each class registered offering price aggregate Registration
of Securities l per Unit (1) offering Price (1) Fee
- -------------------------------------------------------------------------------

Units consisting
of 1 Share of
Common Stock
and 1 Class

A Warrant 1,015,000 $6.00 $6,090,000.00 $1,845.46

Common Stock,
No par value
Per share, being
Part of Units 1,015,000 - - -

Class A Warrants
No par value per
Warrant, being
Part of Units 1,015,000 - - -

Common Stock,
no par value
per share,(2)
underlying
Class A
Warrants 507,500 $10.00 $5,075,000.00 $1,537.88

Underwriter's
warrants, no
par value 100,000 $0.001 $100.00 $0.04

Units, consisting
Of 1 share of
Common stock, no
par value per share,
and 1 Class A
Warrant underlying
Underwriter's
Warrants 100,000 $9.90 $990,000.00 $339.88

Common Stock,
no par value
per share,
underlying
warrants in
Underwriter's
Warrant Units 50,000 $10.00 $500,000.00 $151.08

Total Registration-Fee ----------------------------- $ 3,874.30

The Exhibit Index is located at page 54

(1) Estimated solely for the purpose of calculating the registration fee. (2)
Pursuant to Rule 416 there are also being registered such additional shares as
may be issued pursuant to the anti-dilution provisions of the Warrants.

The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or on such date as the Commission, acting pursuant to
said Section 8(a), may determine.

PPA TECHNOLOGIES, INC.
CROSS REFERENCE SHEET FOR PROSPECTUS

(Pursuant to Item 501 of Regulation S-B)

Item No. Caption in Prospectus

1. Forepart of the Registration
Statement and Outside Front Cover

Page of Prospectus............................Forepart, Cover Page

2. Inside Front and Outside Back Cover
Pages of Prospectus...........................Inside Front Cover Page

3. Summary Information Risk Factors
and Ratio of Earnings
to-Fixed Charges.............................. Prospectus Summary

4. Use of Proceeds.............................. Use of Proceeds

5. Determination of Offering Price.............. Description of Securities

6. Dilution..................................... Dilution

7. Selling Security Holders..................... Not Applicable

8. Plan of Distribution......................... Underwriting

9. Legal Proceedings............................ Legal Proceedings

10. Directors and Executive Officers............. Management

11. Security Ownership of Certain
Beneficial Owners and Management............. Principal Shareholders

12. Description of Securities to Be
Registered................................... Description of Securities

13. Interest of Named Experts and
Counsel ..................................... Legal Counsel, Experts

14. Information With Respect To
The Registrant; Organization
with Five Years............................. Prospectus Summary;
The Company; Dividend Policy;
Selected Financial Information;
Management's Discussion
Analysis of Financial Condition
and Results of Operations;
Business; Management; Principal
Shareholders; Certain
Transactions; Description of
the Securities.

15. Disclosure of Commission
Position on Indemnification
For Securities Act Liabilities.................... Not Applicable

16. Description of Business....................... Business of the Company

17. Description of Property....................... Business of the Company

18. Interest of Management and Others
in Certain Transactions....................... Certain Transactions;
Principal Shareholders

19. Certain Market information.................... Risk Factors; Description
of Securities; Underwriting

20. Remuneration of Directors and Officers........ Remuneration

21. Financial Statements.......................... Financial Statements

PROSPECTUS

PPA TECHNOLOGIES, INC.

A Minimum of 100,000 to a Maximum of 1,000,000 Units,
Each consisting of One Share of Common Stock
and One Class A Redeemable Common Stock Purchase Warrant,
offered at a price of $6.00 per Unit

-----------------------------

A minimum of 100,000 Units are being offered on a firm commitment basis and
an additional 900,000 Units, totaling a Maximum of 1,000,000 of the Units (the
"Units")offered hereby on a best efforts basis for a maximum of ninety (90)
days(the "Offering"), each Unit consisting of one share of common stock, no par
value, (hereinafter referred to as "Share" or "Share of Common Stock") and one
"Class A" Redeemable Common Stock Purchase Warrant (hereinafter referred to as
the "Warrants" or "Redeemable Warrants"), exercisable into one-half share of
common stock per warrant for a period of one year from the effective date
("Effective Date") of the registration statement of which this Prospectus
("Prospectus") is a part at an exercise price of $10.00 per share, are being
offered by PPA Technologies, Inc. (the "Company" or "PPA"). The Warrants are
redeemable at the Company's option commencing 90 days after the Effective date
of the registration statement (the "Registration Statement") of which the
Prospectus is a part) upon 30 days notice of redemption to the Warrant holders
at $.05 per Warrant if the closing bid price of the Common Stock in the
over-the-counter market as reported by the National Association of Securities
Dealers, Inc. ("NASD") shall have for a period of 30 consecutive trading days
ending within 15 days of the notice of redemption average in excess of $10.00
per share (subject to adjustments in the case of a stock split, stock dividend,
recapitalization or similar event). Since it is the Company's present intention
to exercise such right, Warrant holders should presume that the Company would
call the Redeemable Warrants for redemption if such criteria are met. The
Redeemable Warrants are immediately detachable and separately tradable from the
Units upon issuance. It is anticipated that the Shares of Common Stock and
Redeemable Warrants will be included on the NASDAQ Electronic Bulletin Board
Market ("Bulletin Board") under the symbols "PPAS" and "PPAW", respectively.
With respect to the best efforts offering of 900,000 Units, there will be no
escrow account and no minimum purchase.

Prior to the offering, there has been no market for the securities of the
Company. There can be no assurance that a market for the Company's securities
will develop after completion of this offering or, if developed, that it will be
maintained. As a consequence of such a limited market, a purchaser of the Shares
may be unable to sell the Shares when desired and may have to hold the Shares
indefinitely. See "Risk Factors - Limited Trading Market." The determination of
the offering price of the Shares was made arbitrarily by the Company. See "Risk
Factors - Arbitrary Offering Price."

THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SUBSTANTIAL DILUTION TO
PUBLIC INVESTORS. A PROSPECTIVE PURCHASER MAY LOSE HIS TOTAL INVESTMENT. SEE
"RISK FACTORS" AND "DILUTION."

- ------------------------------------------------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

=================================================================

Price to Underwriting Proceeds to
Public Discounts(l) Company(2)
- -----------------------------------------------------------------

Per Unit $6.00 $0.60(4) $5.40
- -----------------------------------------------------------------
Total(3) $600,000 $60,000 $540,000
(Minimum)
- -----------------------------------------------------------------
Total(3) $6,000,000 $546,000 $5,454,000
(Maximum)
=================================================================

(1) The Company has agreed to indemnify the Underwriters against certain
liabilities including liabilities under the Securities Act of 1933, as Amended.
(See "Underwriting.")

(2) Before deducting expenses payable by the Company in connection with the
Offering estimated at approximately $243,000 if the maximum is sold, and $75,000
if the minimum is sold. These expenses include filing fees, printing, a 3%
non-accountable fee to the Underwriters, legal and accounting fees. Net proceeds
to the Company after such expenses are estimated to be $5,211,000 if the maximum
is sold, and $465,000 if the minimum is sold.

(3) The Company has granted to the Underwriters an option (the "Over-Allotment
Option") exercisable within 45 days after the date of this Prospectus to
purchase up to 15,000 additional Units, upon the same terms and conditions as
set forth above, solely to cover over-allotments, if any. If such option is
exercised in full, the total Price to Public, Underwriting Discounts, and
Proceeds to Company will be $6,090,000, $555,000, and $5,535,000, respectively.
See "Underwriting."

(4) The underwriting discount is $0.54 per Unit on the best efforts portion of
the offering.

The date of this Prospectus is _________ 2000.

Kenneth Jerome & Company, Inc.

In connection with this offering, the Underwriters may over-allot or effect
transactions which stabilize or maintain the market price of the Units and the
components thereof at a level above that which might otherwise prevail in the
open market. Such transactions may be effected on the OTC Bulletin Board market.
Such stabilizing, if commenced, may be discontinued at any time.

AVAILABLE INFORMATION

The Company intends to file with the Securities and Exchange Commission (the
"Commission"), New York, New York, a registration statement on Form SB-2 under
the Act with respect to the Units offered hereby. For further information about
the company and the securities being offered hereby, reference is made to the
registration statement and to the financial statements and exhibits filed as a
part thereof. Statements contained in this Prospectus as to the contents of any
contract or any other document are not necessarily complete, and in each
instance, reference is made to the copy of such contract or document filed as an
exhibit to the registration statement, each such statement being qualified in
all respects by such reference. The Registration Statement, including exhibits
thereto, may be inspected without charge at the Commission's principal office in
Washington, D.C., and the Northeast Regional Office located at 7 World Trade
Center, New York, New York and copies of all or any part thereof may be obtained
from such offices after payment of the fees prescribed by the Commission.

REPORTS TO SHAREHOLDERS

The Company intends to furnish its shareholders with annual reports
containing audited financial statements as soon as practicable at the end of
each fiscal year, commencing with the next fiscal year. In addition, the Company
may, from time to time, issue unaudited interim reports and financial
statements. As a result of the effectiveness of the registration statement of
which this Prospectus is a part, the Company will incur a reporting obligation
under the Securities Exchange Act of 1934.

Glossary

Coalescent - A liquid material which when exposed to the environment becomes a
solid.

Reactive Coalescent - A coalescent which becomes solid due to a chemical
reaction.

Volatile Organic Compound ("VOC") - liquid substances which evaporate when
exposed to the environment.

Coupling Agent - A material which can either bond two materials together with
greater strength or, alternatively, can also serve to bond two different
materials together more weakly.

Resin - Organic polymer.

Halogenated - Compounds containing a halogen, e.g. chlorine or flourine.

Phr - Parts per hundred of resin.

V0 - Flame spread rate.

Plate-out - Bloom to the surface of mobile phases.

Cross-linking - Establishment of chemical bonds between different substances.

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the detailed information
and financial statements, including the notes thereto, appearing elsewhere in
this Prospectus and, accordingly, should be read in conjunction with such
information and statements.

The Company

PPA Technologies, Inc. (the "Company", "PPA Technologies" or "PPA") was
incorporated on July 22, 1994 under the laws of the State of New Jersey. The
Company's principal offices are located at 163 South St., Hackensack, NJ 07601
and its telephone number is (201) 457-1221.

PPA Technologies was formed to develop and manufacture innovative specialty
chemical products with applications in the plastics and coatings industries.
After research, development and testing, PPA has begun to sell certain products.

In general, PPA's products improve processing and/or the end product. This
is accomplished through its proprietary Coupling Agents and Reactive
Coalescents. In these areas, the Company's products are an advance in
environmental performance, product performance, cost performance, or, in many
cases, performance in more than one of these parameters. (See "Business of the
Company").

The Offering

The Company is offering hereby through the Underwriter on a "firm
commitment basis" the minimum of 100,000 Units, and on a best efforts basis an
additional 900,000 Units, totaling a maximum of 1,000,000 Units at an offering
price of $6.00 per Unit. Each Unit is comprised of one (1) share of common stock
(no par value per share) and one (1) Class A redeemable common stock purchase
warrant exercisable for five years from the Effective Date at an exercise price
of $10.00 per common share and allowing the purchase of one-half (1/2) share.
The Redeemable Common Stock Purchase Warrants (hereinafter referred to as the
"Warrants" or "Redeemable Warrants") are redeemable at the Company's option
commencing (90 days after the Effective Date) upon 30 days notice to the Warrant
holders at $.05 per Warrant if the closing bid price of the Common Stock in the
over-the-counter market as reported by the NASD shall have for a period of 30
consecutive trading days ending within fifteen days of the notice of redemption
average in excess of $10.00 per share (subject to adjustments in the case of a
reverse stock split, stock dividend, recapitalization or similar event). The
Redeemable Warrants are immediately detachable and separately tradable from the
Units upon issuance. The offering price of the Units and the exercise price of
the Redeemable Warrants were determined by the Company and the Underwriter. Such
prices bear no relation to the book value, assets or earnings of the Company, or
to any other generally recognized objective criteria of value.

Common Stock:

On June 20, 1996, the stockholders approved an increase in the authorized
capital to 10,000,000 Shares of Common Stock, no par value, and 1,000,000 shares
of preferred stock having a par value of $100.00 each. On June 28, 1996 the
Board of Directors effected a 1,000 to 1 stock split upon the filing of the
Amendment of the Certificate of Incorporation authorized by the stockholders.
All financial and stock related numbers set forth herein reflect this stock
split, except where otherwise specifically stated.

Common Stock Outstanding at December 31, 1999 ...... 1,697,500(1)(4)

Preferred Stock Outstanding at December 31, 1999.... 4,806(1)

To be offered(2)
Minimum ...................................... 100,000
Maximum ...................................... 1,000,000

To be outstanding after the Offering(2)
Minimum ...................................... 1,797,500
Maximum ...................................... 2,697,500

Use of Proceeds......... The Company intends to use the maximum net proceeds
of this offering principally for production equipment,
salaries, inventory, advertising, administrative overhead
and working capital. The maximum proceeds of this Offering
will enable the Company to expand marketing of its entire
line of products, and to build an inventory of its products.
The minimum proceeds of this Offering would be used as
working capital and payment of debt. (See "Use of
Proceeds.")

Risk Factors and Dilution ..... Prospective Investors should carefully consider
the factors described under the captions "Risk
Factors" and "Dilution."

Bulletin Board Proposed Listing Symbol (3) .....................PPAS, PPAW
- --------------

(1) Does not include an aggregate of 500,000 shares reserved for issuance under
the Company's Stock Grant and Stock Option Plans nor does it include options on
1,280,000 shares, exercisable at $1.00 per share, and on 120,000 shares at
$1.50, held by management.

(2) Does not include the exercise of any of the Redeemable Warrants contained in
said Units, nor the exercise of any Underwriter's Warrants or the Unit Warrants
contained in the Units issuable upon the exercise of the Underwriter's Warrants,
nor the outstanding warrants held by current shareholders.

(3) The Company intends to apply for and anticipates listing on the Bulletin
Board Market, but there can be no guarantee that such listing will be approved,
or if approved that such listing will be maintained, or if listed that a market
will develop or if developed, that such market will be sustained.

(4) Recent convertible bond conversions have created an additional 82,880 shares
of freely tradable common stock.

SUMMARY FINANCIAL INFORMATION

The following table summarizes certain selected financial data of the Company
and is qualified in its entirety by the more detailed financial statements
contained elsewhere in this Memorandum.

Income Statement:

For the
Six Months period from
Year Ending Year Ending Year Ending Ended Inception, June 22
June 30, June 30, June 30, December 31, 1994 to December 31,
1997 1998 1999 1999 1999

Sales 131,335 148,537 101,272 11,171 778,868
Cost Of Goods 61,453 95,687 54,696 3,764 498,204
------- ------- ------ ------- --------
Gross Profit 69,882 52,850 46,576 7,407 280,664
Operating Expenses 211,080 1,029,258 426,237 191,084 2,188,120
Non-cash
Compensation -0- 500,000 -0- -0-
500,000
Other Income -0- -0- -0- -0- -0-
Other Expenses 3065 43,385 47,160 27,137 120,747
Net Profit(Loss) (144,263) (1,019,793) (426,821) (210,814) (2,028,203)
Per share (0.15) (0.15) (0.09) (0.05) (0.45)
Shares Outstanding 3,355,067 3,355,067 4,516,291 4,516,291 4,516,291
Dividends -0- -0- -0- -0- -0-

Balance Sheet

as of: December 31
1999 As Adjusted(1)
Maximum Minimum

Cash And Cash Equivalents 7,063 5,218,063 472,063
Working Capital (deficit) (919,866) 4,291,134 (454,866)
Total Assets 161,895 5,372,895 626,895
Current Liabilities 972,748 972,748 972,748
Long Term Debt -0- -0- (-0-)
Stockholders' (deficit) (810,853) 4,400,147 (345,853)
Equity

(1) Gives effect to the issuance and sale of the minimum of 100,000 Units and
maximum of 1,000,000 Units offered hereby and the receipt of the estimated net
proceeds ($5,211,000 if the maximum is sold and $465,000 if the minimum is sold)
before their application. This does not take into account any potential revenues
from the 15,000 Units allotted for the over-allotment. See "Use of Proceeds".

RISK FACTORS

The Units being offered hereby are speculative and involve a high degree of
risk. In addition to the other information in this Prospectus, prospective
investors, prior to making an investment, should carefully consider the
following risks and speculative factors inherent in and affecting the business
of the Company and this Offering.

Risks Associated With Forward-Looking Statements. This Prospectus contains
certain forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended ("1933 Act" or "Securities Act") and Section
21E of the Securities and Exchange Act of 1934, as amended, (the "Exchange Act")
and the Company intends that such forward-looking statements be subject to the
safe harbors for such statements under such sections.

The forward-looking statements herein are based on current expectations
that involve a number of risks and uncertainties. Such forward-looking
statements are based on assumptions that the Company will continue to design,
market and provide new products and services on a timely basis, that competitive
conditions in the polymers and additives markets will not change adversely or
materially, that demand for the Company's products will continue or increase,
that the market will accept the Company's new and existing products, that the
Company will retain and add qualified sales, research and systems integration
personnel and consultants, that the Company's forecasts will accurately
anticipate market demand, and that there will be no material adverse change in
the Company's operations or business. The foregoing assumptions are based on
judgments with respect to, among other things, future economic, competitive and
market conditions, and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond the Company's
control. Accordingly, although the Company believes that the assumptions
underlying the forward-looking statements are reasonable, any such assumption
could prove to be inaccurate and therefore there can be no assurance that the
results contemplated in forward-looking statements will be realized. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations".

Accumulated Losses; History of Operating Losses; Explanatory Paragraph
Within Accountants' Opinion. The Company commenced in July of 1994. In order to
execute its business strategy and develop new products, the Company will require
significant funds. Increased spending and decreased sales levels resulted in a
net loss of $426,821 for the fiscal year ended June 30, 1999, and a loss of
$210,814 for the six months ended December 31, 1999 and may result in future
losses as the Company will incur significant expenses in connection with
research and development of its products, development of its direct and indirect
selling and marketing strategies, and the hiring of additional personnel. There
can be no assurance that the Company will be profitable in the future or that
the net proceeds of this Offering, together with any funds provided by
operations and presently available capital, will be sufficient to fund the
Company's ongoing operations. At December 31, 1999, the Company's current
liabilities exceeded its current assets by $919,866 and its cash balance was
$7,063. At December 31, 1999, the Company's accumulated deficit was $2,028,203
and its stockholder equity deficit was $810,853. The Company is dependent on
generating additional sales to improve cash flow, and it is possible that the
Company will require additional debt or equity bridge financing prior to
completion of this Offering. The Company believes its current operating funds,
along with the proceeds of the Offering after deducting amounts used to repay
debt, will be sufficient to finance its cash requirements for at least the next
12 months. See "Use of Proceeds." If the Company has insufficient funds, there
can be no assurance that additional financing can be obtained on acceptable
terms, if at all. The absence of such financing would have a material adverse
effect on the Company's business, including a possible reduction or cessation of
operations. The report of the Company's independent accountants on the Company's
financial statements as of June 30, 1999 contains an explanatory statement
concerning the Company's ability to continue as a going concern. See "Financial
Statements-Report of Independent Auditors."

No Trading Market. There is no trading market for the Company's Common
Stock and there is no assurance that such a market will develop after this
Offering, or if such a market develops, that it will be maintained. Holders of
the Shares may, therefore, have difficulty in selling their stock should they
desire to do so and should be able to withstand the risk of holding their Shares
indefinitely. See "Description of Securities."

Broad Discretion of Management in Allocation of the Proceeds of Offering. A
substantial portion of the proceeds of the offering will be used for general
working capital. If the maximum number of Shares is sold, working capital will
comprise 10.6% of total net proceeds if the maximum is sold and 84% of net
proceeds if the minimum is sold. Management will have broad discretion as to the
use of such proceeds and management reserves the right to reallocate all
proceeds to working capital. See "Use of Proceeds."

Additional Capital. If the minimum is sold, the Company would use the
proceeds solely to bolster working capital while the Company would continue to
seek other sources of funding for its other planned endeavors. The Company
believes that the maximum proceeds of this offering will allow the Company to
meet all of its presently planned future operations for at least twelve months.
If only the minimum is raised, the Company would be required to pursue its
development plans at a significantly reduced rate. The Company would also be
forced to rely upon unrelated third parties to manufacture a much greater
percentage of its products than would otherwise be the case. If the minimum is
sold, the Company would also reduce planned expenditures for marketing and
advertising. If these reduced expenditures were to continue indefinitely, the
Company may be unable to penetrate its target markets and would thus be
adversely affected. However, a significant portion of the proceeds will be used
to develop and improve product lines. Thus, while the Company has no plans that
would require it to seek additional funding if the maximum is sold, it may be
required to do so to complete or accelerate these development programs. There
can be no assurance that such funding will be available on terms acceptable to
the Company, and the failure to procure such funding on acceptable terms could
materially and adversely effect the Company. If an amount is raised that is
greater than the minimum and less than the maximum, the Company would allocate
its resources, more or less, proportionately between the various uses set forth
in the "Use of Proceeds" section of this Prospectus. See "Management's
Discussion and Analysis of Financial Condition and Results of Operation --
Liquidity and Capital Resources."

Limitations Imposed by Environmental Regulation. Federal, state and local
environmental laws govern air emissions and discharges into water and the
generation, transportation, storage, and treatment and disposal of solid and
hazardous waste. These laws establish standards governing most aspects of the
construction and operation of the Company's facilities, and often require
multiple governmental permits before these facilities can be constructed,
modified, or operated. There can be no assurance that all required permits will
be issued for the Company's projects under development or for future projects,
or that the requirements for continued environmental regulatory laws and
policies governing their enforcement may change, requiring new technology or
stricter standards for the control of discharges of air or water pollutants, or
for solid or hazardous waste or ash handling and disposal. Such future
developments could affect the manner in which the Company operates its plants
and could require significant additional expenditures to achieve compliance with
such requirements. It is possible that compliance may not be technically or
economically feasible. To the date of this Prospectus, the Company has not
experienced any delays or costs associated with environmental regulations that
have materially effected the Company's business. See "Business of the Company -
Governmental Regulation".

Untested Marketing Strategy. To date, the Company has experienced
development and shipment delays due to a lack of working capital and resultant
inadequate staffing and there is no assurance that such delays will not
continue. To date, the Company's product marketing efforts have been very
limited and the Company has not been able to capitalize on the interest
generated by said marketing efforts. There is no assurance that if the Company
applies the proceeds of this offering to marketing and distribution that these
problems will disappear. See "Business of the Company - Marketing".

Dependence On Others; Limited Manufacturing Capability. At its present
stage of development, the registrant has developed and continues to develop new
chemicals and new uses for existing chemicals by combining them with chemicals
proprietary to the Company. The Company's strategy for the research,
development, marketing, distribution, and commercialization of its products
entails entering into various arrangements with third party toll manufacturers,
(other companies which the Company pays to manufacture the Company's products or
components thereof) and it is dependent upon the ability of these outside
parties to perform their responsibilities. The Company may also enter into
marketing agreements and arrangements with various third parties, rely on
collaborative partners to conduct research efforts and trials, and to
manufacture and distribute certain of the Company's products. The Company does
not currently have in place all such relationships. The Company does have those
relationships in place which are presently deemed adequate to support the
Company's business for the next twelve months, including toll manufacturing of
proprietary chemicals, and end users in the ink, paint, and plastic industries
which will run field tests on the Company's products. There can be no assurance
that the Company will be successful in establishing all the necessary
collaborative arrangements or that, if established, the arrangements will be
successful or on terms that will enable the Company to achieve profitability.
See "Business of the Company".

Risks Related To Low-Priced or Penny Stocks. In addition, if the trading
price of the Common Stock were to fall below $5.00 per share, trading in the
Common Stock would also be subject to the requirements of certain rules
promulgated under the Exchange Act, which require additional disclosure by
broker-dealers in connection with any trades involving a stock defined as a
penny stock (generally, any non-Nasdaq equity security that has a market price
of less than $5.00 per share, subject to certain exceptions). Such rules require
the delivery, prior to any penny stock transaction, of a disclosure schedule
explaining the penny stock market and the risks associated therewith, and impose
various sales practice requirements on broker-dealers who sell penny stocks to
persons other than established customers and accredited investors (generally
institutions). For these types of transactions, the broker-dealer must make a
special suitability determination for the purchaser and have received the
purchaser's written consent to the transaction prior to sale. The additional
burdens imposed upon broker-dealers by such requirements may discourage
broker-dealers from effecting transactions in the Common Stock, which could
severely limit the market price and liquidity of the Common Stock and the
ability of purchasers in this offering to sell the Common Stock in the secondary
market. See "Description of Securities"; "Underwriting".

Business Dependent Upon Key Employee. The business of the Company is
specialized. The continued employment of Gerald Sugerman is critical to the
Company's proposed product development and the conduct of the Company's
business. Upon closing, the Company intends to procure key man insurance
insuring Mr. Sugerman. There can be no assurance that the Company will be able
to retain Mr. Sugerman or other equally qualified individuals to run the affairs
of the Company. See "Management".

Use of Proceeds to Benefit Insiders. The law firm of the President of the
Company, Roger Fidler, will receive $150,000 from the gross proceeds as an
expense of the offering for services associated with this offering if the
maximum is sold. If the minimum is sold, none of the proceeds will be used for
that purpose. Gerald Sugerman, the Executive Vice President, Secretary and
Treasurer of the Company, will receive from the net proceeds of the offering
$200,000 for payment of future salary and redemption of preferred stock if the
maximum is sold. Otherwise, the proceeds devoted to those purposes will be paid
in amounts equal to the maximum amount described in the "Use of Proceeds"
section of this Prospectus multiplied by the ratio of the amount of the offering
actually sold less the minimum amount set forth in the "Use of Proceeds",
divided by $5,400,000. The amounts to be paid to the insiders which are not paid
by the proceeds of this offering will be paid from either the net profits of the
Company, if any, or the proceeds of future financing. See "Use of Proceeds".

Potential Conflict of Interest. The Law Firm of Roger L. Fidler is a sole
proprietorship owned and operated by Roger L. Fidler, President of the Company,
and this law firm drafted this Prospectus. Since Mr. Fidler will be the
recipient of some of the benefits which will accrue from the successful
conclusion of this offering, there is a potential conflict of interest in that
he is responsible in both capacities for assuring the accuracy of this
Prospectus. See "Management".

Thin Management. The Company employs two officers, one of whom, the
President, is only a part time employee. This thin management exposes the
Company to the risks associated with being undermanaged. See "Management".

No Cumulative Voting - Control by Management. The Company's Certificate of
Incorporation does not provide for cumulative voting. The Company's present
shareholders will own approximately 60.9% (not including the exercise of options
held by management, which, if exercised, would increase such ownership to 73.4%)
of the Company's outstanding Common Stock following the offering, if the maximum
is sold, and 94.4% if the minimum is sold. Thus, the Company's present
shareholders will be able to continue to elect all of the Company's directors
and control the Company. More specifically, Management will own approximately
44% if the maximum is sold, 66% if the minimum is sold, (not including the
exercise of options held by management, which, if exercised, would increase such
ownership to 62.3% if the maximum is sold, 94.4% if the minimum is sold) of the
Company's outstanding Common Stock following the offering. Thus, Management will
be able to continue to control the election of all of the Company's directors
and control the Company. See "Principal Shareholders" and "Description of
Securities."

Lack of Dividends. The Company has not paid dividends since its inception
and does not intend to pay any dividends in the foreseeable future, but intends
to retain all earnings, if any, for use in its business operations. Prospective
investors who seek dividend income from their investment should not purchase the
Shares offered by this Prospectus. See "Description of Securities--Dividends"

Immediate Substantial Dilution. The present shareholders have acquired a
controlling interest in the Company at a cost substantially below the offering
price of the Shares. Upon the completion of the offering, investment in the
Company's Common Stock will result in an immediate substantial dilution of
approximately $4.30 per share (71.7%) if the maximum number of Units is sold at
$6.00 per Unit, and approximately $5.97 or 99.5% if the minimum is sold, while
the present shareholders will realize an immediate increase in the net tangible
book value of approximately $1.94 per share (32.2%) if the all Units are sold
and $0.27 per share (4.5%), if the minimum is sold. The foregoing assumes that
no Redeemable Warrants are exercised and does not take the over-allotment into
account. See "Dilution."

Inexperience of Management. Gerald Sugerman is the originator of the
Company's business concept and has run the Company since inception. No officer
of the Company has had, prior to the organization of the Company, experience in
the managerial aspects of the inks, paints, and plastics polymer additives
industry. Since the business is relatively new, the experience of management can
give no assurance that the business will continue to succeed. See "Management."

Arbitrary Offering Price. The Offering Price at which the Shares are being
offered has been arbitrarily determined by the Company and the Underwriter.
There is no relationship between the said prices and the Company's assets, book
value, net worth or any other economic or recognized criteria of value.

Sales Pursuant to Rule 144. Officers, Directors and/or affiliates of the
Company hold 1,697,500 Common Shares of the Company, all of which are, subject
to quantity limitations discussed below, available for sale. Such shares are
"restricted securities" under Rule 144, as promulgated by the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended, which
shares may not be freely resold. Rule 144 provides, in essence, that any
shareholder of the Company, after holding restricted securities for a period of
one year, may, every three months, sell them in an unsolicited brokerage
transaction in an amount equal to 1% of the Company's outstanding Common Shares,
or the average weekly trading volume, if any, during the four weeks preceding
the sale. After two years, non-affiliated shareholders holding restricted
securities are no longer subject to the 1% limitation and may sell unlimited
amounts of shares they own. If a substantial part of the shares which can be
sold were so sold, the price of the Company's Common Shares might be adversely
affected. (See "Principal Shareholders" and "Underwriting.")

Underwriter's Warrants The Company has agreed to sell to the Representative
Underwriter Warrants (the "Underwriter's Warrants") to purchase an aggregate of
an amount equal to 10% of the Units sold by the Company hereby. The
Underwriter's Warrants may be exercised for a period of four years commencing
one year after the date of this Prospectus, at a price equal to 165% of the
public offering price. For the life of the Underwriter's Warrants, the holders
are given, at a nominal cost, the opportunity to profit from a rise in the
market price for the Common Stock of the Company without assuming the risk of
ownership, with a resulting dilution in the interest of the other securities
holders. As long as the Underwriter's Warrants remain unexercised, the terms
under which the Company could obtain additional capital may be adversely
affected. Moreover, the holders of the Underwriter's Warrants might be expected
to exercise them at a time when the Company would, in all likelihood, be able to
obtain additional capital by a new offering of its securities on terms more
favorable than those provided by the Underwriter's Warrants. See "Descriptions
of Securities" and "Underwriting."

Product Protection and Infringement. The Company relies on a combination of
patent and trade secret laws, nondisclosure and other contractual agreements and
technical measures to protect its proprietary rights in its products. The
Company has applied for several patents, both domestic and foreign, and will be
applying for several more patents. Such protection may not preclude competitors
from developing products with features similar to the Company's products. The
Company believes that its products, trademark and other proprietary rights do
not infringe on the proprietary rights of third parties. There can be no
assurance, however, that third parties will not assert infringement claims
against the Company in the future. The successful assertion of such claims would
have a material adverse effect on the Company's business, operating results and
financial condition. See "Business of the Company-Proprietary Rights."

Possible Difficulties In Obtaining Supplies. The success of the
Company's additive products will depend on the ability of the Company to obtain
significant amounts of raw materials at affordable prices. The Company may
encounter shortages or delays in obtaining adequate amounts of raw materials,
and the Company has not yet entered into an arrangement pursuant to which it
will ensure adequate access to those materials. The failure of the Company to
obtain adequate materials at affordable prices could have a material adverse
affect on the Company's ability to produce and deliver its products.

Revenue Concentration from a Small Group of Customers. The Company
presently, and historically, derives the majority of its revenues from a small
group of customers, or a single customer. The Company expects this trend to
continue for some time. The Company has experienced material losses related to
one of it's customers inability to pay for the Company's products. As the
Company's customer base expands it may be subject to increased credit risk. Such
concentration exposes the Company to the risk of severe fluctuations in revenue,
cost of goods sold and business continuity. The inability of one of these
significant customers to satisfy its obligations to the Company could have an
adverse material affect on the Company. See "Financial Statements"

Limitations on Liability of Officers and Directors. The Company's Articles
of Incorporation substantially limit the liability of the Company's Officers and
Directors to its shareholders for breach of fiduciary or other duties to the
Company, to the full extent permitted by New Jersey law. See "Management
- -Indemnification."

USE OF PROCEEDS

The net proceeds to be realized by the Company from the sale of the maximum
number of Units offered hereby, after deducting all commissions and expenses of
the offering, is estimated at $5,211,000 ($465,000 if the minimum is sold).
Included in the expenses of this offering are the commissions and projected
legal fees, accounting fees, filing fees and printing costs. No officer,
director or affiliate of the Company, or associated person of them, will receive
any portion of the gross proceeds of this offering, except for legal fees owed
to the law firm of its President to be paid from gross proceeds as an expense of
the offering in an amount not to exceed $150,000 (0 if the minimum is sold, with
the balance pro-rated); and payments from the net proceeds to Gerald Sugerman,
Vice President and Secretary of the Company, for future payments due under his
employment contract, which provides for payments of $10,000 per month, and for
redemption of his preferred stock not to exceed a combined total of $200,000 (0
if the minimum is sold, with the balance pro-rated). (See "Remuneration of
Officers and Directors") These funds will be used by the Company in
substantially the following manner:

Maximum Minimum
ADMINISTRATIVE

Officers Salary $200,500 3.84 %
Equipment 6,000 0.12
Supplies 2,000 0.04
Salaries 40,000 0.77
Overhead 60,000 1.15
------ ------
308,500 5.92

PRODUCTION & CUSTOMER SERVICE
Salaries 240,500 4.62
Equipment 1,793,500 34.42
Inventory 451,500 8.66
------- ------
2,485,500 47.70

PRODUCT DEVELOPMENT
Equipment 301,000 5.78
Supplies 175,500 3.37
Salaries 110,500 2.12
------- ------
587,000 11.27
MARKETING
Advertising 501,500 9.62
Salaries 652,000 12.51
Travel and Entertainment 50,000 0.96
------ ------
1,203,500 23.09

WORKING CAPITAL 551,600 10.58 391,100 84.0

DEBT REPAYMENT 74,900 1.44 74,400 16.0

TOTAL ------------------------ $5,211,000 100% 465,000 100%

Since the proceeds of this Offering, will be applied over time, the actual
expenditure of such proceeds for any purpose could vary significantly from the
anticipated expenditures described above. The Company reserves the right,
therefore, to reallocate proceeds among the uses described above, including to
working capital, depending upon factors such as the results of the Company's
marketing efforts, the Company's success in developing new products, and
technological advances in the industry.

The net proceeds of this offering may not be used immediately. Any net
proceeds of this offering that are not expended immediately will be deposited
only in short-term interest bearing obligations of the United States government.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations".

DIVIDEND POLICY

The payment by the Company of dividends, if any, in the future rests within
the discretion of its Board of Directors and will depend, among other things,
upon the Company's earnings, its capital requirements and its financial
condition, as well as other relevant factors. The Company has not paid any
dividends to date and does not anticipate that it will be in a position to pay
any dividends in the foreseeable future.

DILUTION

As of December 31, 1999, there were 1,697,500 of the Company's Common
Shares issued and outstanding. See "Description of Securities." If all Units
(1,000,000) offered hereby are sold there will be 2,697,500 Shares outstanding.
If the minimum is sold, there will be 1,797,500 shares outstanding.

As of December 31, 1999, the approximate net tangible book value of the
Company's common stock (total tangible assets less total liabilities) was
$(812,203) or $(.48) per share. See "CAPITALIZATION." Giving effect to the sale
of 1,000,000 Units and receipt of the net proceeds therefrom, the pro forma net
tangible book value of the Company would be approximately $4,398,797, or $1.63
per share. This represents an immediate dilution of $4.37 (72.8%)for each share
of Common Stock purchased by new investors and an immediate increase of $2.11
(35.2%) per share to existing shareholders. If the minimum number of shares is
sold, 100,000, then the book value after the offering will be $(347,203), or
($0.19) per share. This represents a dilution of $6.19 (103.2%) to the new
investors and an immediate increase of $0.29 (4.83%) per share to existing
shareholders.

Maximum Minimum

Sale price per unit $6.00 (100.00%) $6.00 (100.00%)

Net tangible book value per unit
before offering............ $(0.48) ((8.0%)) $(0.42) ((8.0%))

Increase to present shareholders
in net tangible book value
attributable to sale of
shares offered........... $2.11 (35.2%) $0.29 (4.83%)

Pro Forma net tangible book value
per share after offering... $1.63 (27.2%) $(0.19) (3.17%)

Dilution of net tangible book
value per share to new
investors.................. $4.37 (72.8%) $6.19 (103.2%)

The officers and directors of the Company have acquired their common
shares for cash of $101,750. If the maximum number of Shares is sold, the new
investors shall acquire 1,000,000 shares (about 37.1% of the total outstanding
common shares) at a price of $6.00 per share or a total of $6,000,000. The
following table summarizes the number of shares acquired from the Company and
the aggregate consideration paid by the existing shareholders and to be paid by
new shareholders in this Offering:

Number of Percentage Aggregate Aggregate
Shares Acquired of Shares Consideration Consideration
from Company Held by Group Paid for Shares Paid as a Percentage

Existing
shareholders........1,697,500 62.9% $236,750 3.8%

New shareholders....1,000,000 37.1% $6,000,000 96.2%
(Maximum)

Total...............2,697,500 100.0% $6,236,750 100%
(Maximum)

New shareholders....100,000 5.6% $600,000 71.7%
(Minimum)

Total...............1,797,500 100.0% $836,750 100%
(Maximum)

SELECTED FINANCIAL INFORMATION

The following table sets forth certain selected financial data for the
years ended June 30, 1997, 1998, and 1999, and the fiscal quarter ended
December 31, 1999. This information is derived from the Company's financial
statements which appear elsewhere in this Prospectus. The selected financial
data is qualified by reference to, and should be read in conjunction with, the
Company's financial statements and notes thereto included elsewhere in this
Prospectus and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS".

Income Statement:

For the
Six Months period from
Year Ending Year Ending Year Ending Ended Inception, June 22
June 30, June 30, June 30, December 31, 1994 to December 31,
1997 1998 1999 1999 1999

Balance Sheet

as of: December 31
1999 As Adjusted(1)
Maximum Minimum

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
December 31, 1999 and as adjusted to give effect to the issuance and sale of
the shares upon the closing of this offering:

Actual As Adjusted
(Maximum) (Minimum)

Long Term Liabilities 0 0 0

Stockholders' Equity:

Preferred Stock, 480,600 480,600 480,600
$100 par value per
share, authorized
1,000,000 shares,
issued and outstanding
4,806 shares; as
adjusted 4,806

Common Stock, no par
value authorized
10,000,000 shares;
issued and outstanding
1,697,500 shares; as
adjusted 2,697,500 736,750 5,947,750 1,201,750

Deficit Accumulated During
Development Stage (2,028,203) (2,028,203) (2,028,203)

Total Stockholders' Equity (810,853) 4,400,147 (345,853)

Total Capitalization (810,853) 4,400,147 (345,853)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998 AND 1999 AND FOR THE SIX MONTHS
ENDED DECEMBER 31, 1998 AND 1999 AND FOR THE PERIOD FROM INCEPTION (JULY 22,
1994) TO DECEMBER 31, 1999.

Development stage activities.

The Company has been a development stage enterprise from its inception July
22, 1994, to December 31, 1999. The Company develops and manufactures innovative
specialty chemical products with applications in the plastics and coatings
industries. To date the Company has had minimal sales of these additives
representing limited quantities produced from its research and development
facilities in Hackensack, New Jersey.

During this period, management devoted the majority of its efforts to
obtaining new customers for its products, developing sources of supply,
developing and testing formulas, pursuing and finding a management team to begin
the process of: completing its marketing goals; furthering its research and
development for its products; marketing limited quantities of the Company's
products; completing the documentation for and selling initial shares through
the Company's private placement; and completing the documentation for the
Company's initial public offering. These activities were funded by the Company's
management and investments from stockholders and borrowings from related third
parties. The Company has not yet generated sufficient revenues during its
limited operating history to fund its ongoing operating expenses, repay
outstanding indebtedness, or fund its product development activities. For the
period of inception July 22, 1994, to December 31, 1999, the Company completed
the development of its first product line. The recent acquisition and
construction of operating assets positions the Company to produce initial
quantities of products with present production facilities. There can be no
assurance that sales to utilize such capacity will develop. Further investments
into processing and production as defined in the Company's operating plan will
significantly reduce the cost of preparation, processing and production by
enabling the Company to operate without reliance upon outside vendors and
suppliers.

During this developmental period, the Company has been financed through
officer's loans with a balance of $110,689 from Roger Fidler, of which $100,000
of the aggregate debt was converted to shares of common stock through the
exercise of 100,000 options at $1.00. In addition, Mr. Sugerman either advanced
to the Company or paid on behalf of the Company expenses aggregating $217,548 of
which all but $158,800 was converted to shares of preferred stock as of December
31, 1999. The Company also financed its activities through the sale of $372,500
in 12% bridge notes and through the sale of shares of common stock aggregating
$236,750. Although, the sales of limited quantities of developed products were
primarily in the ink business with test quantities of additives and paints being
supplied for testing by paint manufacturers, retailers and volume users of these
products, it is expected that the near term significant sales will come from
customers using the Company's paint additives and the sale of paints.

Results of Operations for the year ended June 30, 1999 as compared to the
year ended June 30, 1998

For the year ended June 30, 1999, the Company generated net sales of
$101,272 as compared to $148,537 for the year ended June 30, 1998 representing
an decrease of $47,265 or 31.8%. Of these sales approximately 60% were to two
large customers. Sales decreased over the same period last year as a result of a
return of approximately $24,000 in merchandise sold during the year by one large
customer and writing of approximately $11,000 I sales to the same customer as a
bad debt. The Company's cost of goods sold for the year ended June 30, 1999 was
$54,696 or 54.0% of sales as compared to $95,687 or 64.4% of sales for the year
ended June 30, 1998.Cost of goods sold for the year ended June 30, 1999,
includes a loss on nonreturned inventory from this one customer of approximately
$4,400 and a return to inventory of $9,600 that was determined to be usable. The
Company's gross profit on sales was approximately $ 46,576 or 46.0% of sales as
compared to $52,850 or 35.6% of sales for the year ended June 30, 1998. The
decrease in gross profit is the result of having produced very limited
quantities of additives and test quantities of paints, paint additives and Ink
additives for sales to potential customers for testing purposes. The decrease in
gorss profit is also the result of $4,400 charge to cost of goods sold from the
return of the sale.

The Company's general and administrative costs aggregated approximately
$269,660 or for the year ended June 30, 1999 as compared to $429,109 for the
year ended June 30, 1998 representing an decrease of $163,902. This decrease
represents a scale back of sales help and support staff that were hired to test
a marketing sales program and reflects a reduction in office staff and
production help with a redirection of providing test quantities of products to
large purchasers for their evaluation. The reduction in general and
administrative expenses is enables the management of the Company to provide the
working capital from personal funds until the completion of the public offering.
The Company expended monies for general and administrative expenses as follows:
$117,257 in wages; $42,192 for rent; $9,190 in legal and professional related to
the public offering; $125,565 for office expense; 33,269 in laboratory and
supplies expenses, research and development of $54,644; depreciation of $33,794;
and a write off to bad debt expense of $57,139.

Results of Operations for the six months ended December 31, 1999 as
compared to the three months ended December 31, 1998

For the six months ended December 31, 1999, the Company generated net sales
of $11,171 as compared to $56,132 for the six months ended December 31, 1998
representing an decrease of $44,961 or 80.1%. Of these sales approximately 90%
were to two large customers. Sales decreased over the same period last year as a
result of a concentration of efforts towards producing samples for specific
targeted clients. The Company's cost of goods sold for the six months ended
December 31, 1999 was $3,764 or 33.7% of sales as compared to $32,906 or 58.6%
of sales for the six months ended December 31, 1998. The Company's gross profit
on sales was approximately $7,407 or 66.3% of sales as compared to $18,651 or
41.4% of sales for the six months ended December 31, 1998. The increase in gross
profit is the result of having produced very limited quantities of additives and
test quantities of paints and paint additives for sales to potential customers
for testing purposes.

The Company's general and administrative costs aggregated approximately
$129,253 or for the six months ended December 31, 1999 as compared to $154,753
for the six months ended December 31, 1998 representing an decrease of $25,500.
This decrease represents a reduction in the costs to manage the business while
the Company is in the development stage. The reduction in general and
administrative expenses is enables the management of the Company to provide the
working capital from personal funds until the completion of the public offering.
The Company expended monies for general and administrative expenses as follows:
$36,500 in wages; $18,220 fohr rent; $32,360 for office expense; $26,208 in
laboratory supplies and materials for the production of samples; $45,000 in
research and development.

Results of Operations for the period of inception (July 22, 1994) to
December 31, 1999.

For the period from the Company's inception, July 22, 1994, through
December 31, 1999, a period of approximately 68 months, the Company generated
net sales of $778,868(an average of $11,454 per month). Of these sales
approximately 40% were to two large customers. The Company's cost of goods sold
on sales was approximately 63.9% for the period from the Company's inception
July 22, 1994, through December 31, 1999. The gross profit from sales for this
68 month period is 36.1%. Management believes the gross profit of an average of
36.1% for the period from inception July 22, 1994, through December 31, 1999,
will improve and stabilize once the Company's manufacturing facilities become
realized at the completion of the public offering and its marketing plans become
fully implemented.

The Company's general and administrative costs aggregated approximately
$1,459,736 for the period from inception July 22, 1994, through December 31,
1999. Of these initial start-up costs, approximately $495,000 is attributed to
wages and reimbursed expenses of Gerald Sugerman; approximately $79,643 in rent;
legal and professional fees of $83,135; filing fees, office expenses including
salaries, outside labor, printing, laboratory and computer supplies of
approximately $505,873; research and development of $149,887; salaries of
approximately $213,085; depreciation of $78,497, commissions of $83,000 and a
write off to bad debt expense of $110,014 for the loss relating to Enviro Ink.

Liquidity and Capital Resources.

The Company's cash balance at June 30, 1999 and December 31, 1999 was
$9,539 and $7,063 respectively. Working capital at June 30, 1999 December 31,
1999 is negative at $714,139 and $919,866 respectively. For the year ended June
30, 1999, working capital was provided by increases in accounts receivable of
$609 and in accounts payable and accrued expenses of $127,339 and was reduced by
an increase in inventory of 29,167. For the six months ended December 31, 1999,
working capital was provided by a decrease in accounts receivable of $5,812, a
decrease in inventory of $43,060 and an increase accounts payable and accrued
expenses of $41,499. The Company continued to be funded in part through officer
loans aggregating $751,643. Of which $474,447 was eventually converted to both
shares of common and preferred stock. The Company also financed its activities
through the sale of $372,500 in 12% bridge notes. The Company expended cash as
follows: $181,160 in capital assets; paid security deposits of $5,000; purchased
inventory of $45,532; and funded a related party accounts receivable which was
eventually deemed uncollectable and written off amounting to $99,014 and an
additional accounts receivable of $11,000.

Management believes that it will be able to fund the Company and the
initial cost of the offering from personal resources until the completion of the
initial public offering. The Company is initiating an initial public offering of
1,000,000 Units at $6.00 per Unit for an aggregate of $6,000,000. The Company
will defer the expenses of the Offering until the Offering is completed and the
offering expenses will be deducted from proceeds received therefrom. The
Offering proceeds will be sufficient to satisfy Management's objectives of
purchasing equipment for office, production and product development of
$2,106,000, purchasing supplies for office and product development of $177,000,
financing the payment of administrative, production, and marketing salaries of
$1,240,000, pay advertising of $500,000, purchase inventory of $450,000, pay
overhead of $60,000, pay travel and entertainment expenses of $50,000, provide
working capital of $412,000, pay Underwriter's Discounts of $600,000 and pay
projected offering expenses of $347,000. The Company is currently obligated to
repay $60,000 of the initial 12% bridge notes. This investor has commenced
litigation to collect this debt, but management has asserted a counterclaim
against this investor. Management plans to reserve sufficient funds from the
proposed public offering to pay this debt in the event of an adverse court
ruling. The balance of the bridge note holders have agreed to convert their
notes into stock or to extend payment until June, 2001.

BUSINESS OF THE COMPANY

SUMMARY

PPA Technologies, Inc., hereinafter referred to as "PPA" or "the Company",
was incorporated in the State of New Jersey in July, 1994 to develop and
manufacture innovative specialty chemical products with broad application in the
plastics and coatings industries. The Company now markets proprietary products
including VOC free coalescents, organometalic coupling agents, and reactive
diluents and has recently launched the marketing of inks, paints and coatings
utilizing the Company's proprietary technologies.

THE INDUSTRY

Industry

The Company operates in two polymer based industries, plastics and
coatings. Each of these industries is vast in total worldwide production and
sales.

The plastic industry is composed of several subsets. However to present a
concept of general size, worldwide sales of polyvinyl chloride ("PVC") exceeded
18 billion dollars in 1995, and those of polyethylene were in excess of 50
billion. Sales by the twenty five largest film and sheet plastics manufactures
were 12.4 billion dollars in 1996. Domestic sales of PVC pipe totaled about 8.7
billion dollars in 1996.

The global paints and coatings market totaled $65 billion in 1995. In
North America alone 4.7 million metric tons were produced in 1995 having a value
of about 15 billion dollars. The top ten producers accounted for about 60% of
the market.

Organometallic Coupling Agents

These coupling agents are organometallic compounds which may be delivered
in liquid, powder or pelletized forms depending primarily upon customer need.
These products are presently used primarily by plastics compounders and
manufacturers of plastic products to obtain improved line speed, faster
throughput, lower operating temperatures and pressures, better dry blend and hot
melt flow, reduced energy requirements, better control over wall/sheet
thickness, higher impact resistance and greater flame retardance.

Since only small proportions (.2 to 2% of the total product mix by weight) of
these compounds are used, worldwide market volumes of coupling agents are quite
low, and total only several million pounds. However, because of the great
benefits to be derived from their use, profit margins on coupling agents are
quite high. Also, the totality of products in which coupling agents could be
beneficially used is vast, including at least 10% of the total plastics, and an
even larger proportion of the coating output worldwide. At present there are
only a few sources of these compounds, one of which is PPA.

Reactive Diluents / Coalescents

Reactive / diluents / coalescents allow resin producers, formulators, and
coatings end-users to utilize Low / Zero VOC solutions in place of current
solvent-based packages. In architectural and industrial coatings, volatile
organic solvents have been historically required and applied to a) dissolve the
resin, and b) to provide coalescing action. These traditional solvents, which
comprise the competing products for the Company's reactive diluents /
coalescents, have markets exceeding $5 billion per year. Historically, they have
been used because of their low price and a lack of concern regarding the
environmental impact of their use, i.e. the consequences of evaporation of the
solvent into the air. With increasing restrictions being placed upon the use of
VOC's because of these environmental concerns the use of solvents is under wide
spread attack and many companies have been attempting to develop replacements
for these solvents in a wide variety of applications. To date such replacements
have been generally unsatisfactory expensive and limited in application. the
Company's reactive diluents basically replace VOCs which contribute little (if
anything) to the finished coating except for ease of application and cost; with
nonpolluting alternatives which add significantly to the product's performance.

The architectural coatings market alone was over 450 million gallons in
1995 out of a total paint and coatings volume of one billion gallons. This
market largely divided into latex and oil based (solvent borne) segments. In
latex based coatings, conventional coalescents typically comprise 15 to 40% of
the complete formulation; in oil based systems, the percentage of solvent used
varies from about 25 to 50% in most products. Displacement of these VOC
requirements by the Company's VOC free alternatives, (3-7% requirements) could
create a market potential in excess of $400 million versus the present
architectural requirement of 67.5 million gallons of coalescents or $918
million. As the Clean Air Act, 42 U.S.C. sections 7401-7671, is further enforced
along with new environmental legislation, the need to replace solvent with
reactive diluents / coalescents will increase.

According to the Chemical Marketing Reporter, October 19, 1995 edition "The
$300 million additives segment is expected to continue to outpace the coatings
business as a whole, and the bulk of this growth comes from the push to reduce
solvent use." As the percentage of solvents in coatings continues to shrink in
favor of water and additives, including reactive coalescents, demand for
reactive coalescents, such as those produced by the company, should increase.

Flame Retardants

Flame retardants comprise 40% to 50% of all additives for plastics
worldwide. Historically, halogenated materials have been the preferred flame
retardants, comprising about 80% of the market. In the past ten years, this
group of chemicals has become the subject of legislated restrictions and in
general has lost market share to less effective additives because of well known
disadvantages: they often cause localized corrosion of metals in direct contact
(e.g. wire and cable), cannot incinerate scrap or used product due to hazardous
fumes generated, and their thermal decomposition and/or combustion results in
toxic fumes. Effective early in 1991, Western Electric banned all use of
halogenated chemicals from its wire and cable coatings.

Flame retardants comprise a significant percentage of all additives for
plastics worldwide. Almost 90% of the $3 billion per year domestic plastic
additives sector is comprised of just four products - plasticizers, flame
retardants, impact modifiers and lubricants. Of the approximately 35 billion
pound annual polyolefin market, about 10% or 3.5 billion pounds contain flame
retardant. At an average loading of 50 phr flame retardant, the 3.5 billion
pounds polyolefins sector translates to about one billion pounds of flame
retardant sold annually.

Halogen-based FR chemicals are added at 15 to 50 phr and are currently sold
at$1.40 to $2.40 per pound. The Company's flame retardants will cost about 40%
less to achieve the same degree of flame retardance. Aluminum and magnesium
hydroxides do not have many of the disadvantages of the halogen compounds
discussed above, but these hydroxides offer limited application., and the need
for as much as 75 to 85 phr in the formulation to achieve a 94V0 UL (a standard
flame spread rate measurement) rating, only a small number of uses are
practical. consequent to the severe degradation of the plastics properties
engendered by the necessity to use such high proportions of filler. Usage of
low levels of the company's organometalic coupling agents in both halogen and
hydrate based flame retarded plastics (0.3- 0.5%), significantly reduces FR
requirements, enhances processability and upgrades physical properties. (See
"The Company's Products - Flame Retardants").

THE COMPANY'S PRODUCTS

Coupling Agents

PPA offers approximately 15 different organometallic coupling agents
available in liquid, powder or pelletized forms. Like their competitor products,
they can be and are used primarily by plastics compounders and manufacturers of
plastic products to obtain improvements such as: higher line speed, faster
throughput, lower operating temperatures and pressures, better dry blend flow
and hot melt flow, reduced energy requirements, better control over wall/sheet
thickness, higher impact resistance and greater flame retardance.

Since all coupling agents are presently proprietary products, the
opportunity for the production of value added products utilizing these compounds
is more than feasible. The overwhelming advantage of the coupling agents in
almost all applications is the ability to produce a more cost effective product
with the coupling agent thereby creating a true "value added" situation enabling
either direct sales of the agent or production of a more finished product at
competitive price advantages in large markets of essentially fungible
commodities. Most purchasers in fact prefer receipt of compounded resins (resins
in to which additives, such as the coupling agents, have been added) rather than
the pure coupling agents (which would then be added to the resin by the end
user). While margins on the value added products are lower than the coupling
agents, the total gross profit from operating a compounding facility is many
times greater than from sale of the coupling agents alone. It is the Company's
intention to move into value added products where feasible.

Our coupling agents have already been successful in extrusion,
injection and blow molding operations, so Management assumes that coupling
agents can be beneficially utilized in a large part of the total plastics
market.

Reactive Coalescents

Approximately 23 reactive coalescent packages have been developed
to-date. These products allow resin producers and coatings end-users to utilize
Zero VOC solutions in place of current solvent-based packages. In architectural
(building) and industrial coatings, volatile organic solvents have been
historically required and applied to a) dissolve the resin, and b) to provide
coalescing action. PPA coalescing packages are 100% solids (after application),
Zero VOC (as measured by present test methodologies), water-reducible systems
that provide all of the necessary dissolution and coalescing of solvent-based
systems, but which are a) without solvents for immediate Clean Air Act
compliance, b) more cost effective since there is no wasted solvent to evaporate
out of the coating, and of considerable importance, and c) generate harder, more
durable films due to chemically reactive cross-linking versus no cross-linking
in organic solvent systems.

Flame Retardants

PPA flame retardants are non-halogenated for health and safety concerns,
and they utilize coupling agents for maximum dispersion efficiency. The end
result allows the end user to: a) use lower cost resin than with alterative
flame retardants, b) run at 10 to 20% higher speed, and at lower temperatures,
and c) only PPA offers a concentrated compound that the customer can add at a
1:1 rate to achieve high resistance such as Vo.

PPA flame retardants are targeted for polyolefins only at this time.
This means high density polyethylene, low density polyethylene, and
polypropylene.

With respect to cost, PPA materials cost will be $0.95 to $1.10 per
pound of compound for large volume purchases. This represents a distinct price
advantage over the competition which typically sells for $2.80 per pound and
requires as much as 45 weight percent in polyolefins to acheive 94 V0. The
anticipated sales volume is 1% of the market for olefins (hydrocarbons
containing at least one double bond) or 10 MM lbs/yr.

PPA flame retardants offer U.L.94 V0 efficacy in 1/16" polypropylene at
just 30 to 35 phr. PPA coupling agents are employed for their large surface
activity which creates the following advantages in comparison to both
halogenated and non-halogenated flame retardants:

1. The ability to use lower cost resin than with alternative flame retardants;
2. The melt index is basically unaffected; 3. Manufacturing processes can run at
10 to 20% higher speeds, and at lower temperatures; and, 4. PPA can offer a
concentrated compound that the customer can add at a 1:1 rate to achieve high
resistance such as V0. (This advantage is in comparison to non-halogenated
additives only).

As with all of the Company's products, the apparent technological
superiority in flame retardant technology has yet to be translated into sales
due to, in the Company's opinion, lack of funds for marketing, advertising, and
sales efforts.

Governmental Regulation

As a chemical manufacturer the Company is subject to a wide variety of
local, state and federal regulations. While the Company believes that it is in
compliance with all applicable regulations, there can be no assurance that from
time to time unintentional violations of such regulations will not occur. In the
event of such violations, the company may be subject to fines, injunctive action
and other forms or governmental action which would have a material and adverse
impact on the Company (see Risk Factors-Limitations Imposed by Environmental
Regulation.) The following is a brief survey of some of the applicable federal
regulations believed by the Company to include all material regulations. Many
states, including the State of New Jersey where the Company has its principle
place of business, also regulate certain aspects of the chemical industry. In
general, compliance with federal regulation would comprise the more difficult
burden. One example discussed herein below, California, has more stringent
regulation.

The Resource Conservation and Recovery Act 42 U.S.C. Sec. 6901-6987
("RCRA") was enacted in 1976. The Comprehensive Environmental Response,
Compensation and Liability Act, 42 USC Sec. 9601-9657 ("CERCLA") was enacted in
1980. These statutes regulate the disposed of hazardous waste and the clean-up
of chemicals that have been, or will be, subject to illegal disposal. The Toxic
Substance Control Act (hereinafter TOSCA) also governs aspects of chemical
disposal. The Clean Air Act and the Clean Water Act also control emissions into
the atmosphere and water systems (hereinafter these statutes are referred to as
PCS.)

The Company believes that it is a) not in violation of the PCS and b)
not subject to the PCS because of the nature of the materials being utilized by
the Company at this time. However, existing environmental laws may be amended
and new laws may be enacted by Congress and state legislatures and new
environmental regulations may be issued by regulatory agencies. For these
reasons, the Company cannot predict the specific environmental control
requirements that it will face in the future.

Compliance with Federal, State and local provisions which have been
enacted or adopted regulating the discharge of materials into the environment,
or otherwise relating to the protection of the environment, may have a material
effect on the capital expenditures, earnings and competitive position of the
registrant and its subsidiaries.

MARKETING

Having completed Research & Development work for fifteen coupling
agents, limited marketing and sales have commenced. Various powder and pellet
forms of these are also available. The current list of active customers includes
five plastics manufacturers. As a result of the sales effort PPA coupling agents
have been accepted in several different applications such as PVC pipe production
and sporting goods production.

Trials are ongoing for the utilization of coupling agents in PVC window
frames, PVC electrical conduit, glass and carbon reinforced nylon structural
composites, carbon filled polystyrene electrical conductors, color concentrates
in polyethylene, polypropylene and ABS (acrylonitrile butadiene styrene), and
several ink and paint applications, including waterbourne and solvent based
systems. So far these tests have been successful.

The reactive coalescent packages have proven successful in wood coatings
and architectural applications. Regional, national and international companies
have shown interest in these products and testing by these companies are also
ongoing. More specifically, the Company has submitted fifty formulations to a
major western United States regional paint and coatings manufacturer which is
considering adopting the Company's technology as the major technology for most
of its coatings applications. Similarly, all major United States alkyd resin
manufacturer's are currently evaluating the Company's reactive coalescent
technology to maintain performance standards for their alkyd paints since United
States Environmental Protection Agency ("EPA") AIM standards promulgated under
the Clean Air Act have rendered traditional technology illegal for the
production of flat alkyd paints as of September, 1999. Among the end-users
evaluating finished products supplied by the company is a major naval
contractor.

Marketing in these areas have to date been limited to direct mail to
potential customers and referrals through the personal business contacts of the
officers. The Company has employed two commission only salesmen to expand this
effort with primary focus on printing inks in Europe and alkyd paint products in
the United States. A recent (January 2000) test of the ink product attracted the
attention of the majority of high volume gravure ink purchasers in Germany with
total combined gravure ink purchasers in excess of 1 billion dollars. Initial
impact of that successful test has been a request from two of these printers for
test runs in their own facilities and a further test request from the printer at
whose facilities the test was run. Since these test runs consume approximately
one hundred thousand dollars for paper the Company believes these test requests
to be an indicator of serious interest. However, there can be no assurance that
any of these printers will become customers for the Company's ink. A similar
test in the United States for a printer of french fry containers had been
successfully concluded when the printer decided not to purchase the Company's
ink. In response to this decision, the customer for whom the printing was being
done, a Fortune 500 company which PPA had contacted directly, decided to change
printers. The new printer will retest the ink on its press in the near future,
probably during March. The Company believes that this approach to marketing will
be useful in the future due to the environmentally friendly aspects of the
Company's products and the desire of larger companies to be sensitive to
environmental concerns. The Company intends to expand these marketing efforts
upon the successful conclusion of this Offering (See "Use of Proceeds") by
attendance at trade shows, advertising in trade journals and by hiring
additional sales personnel. The Company also plans to expand marketing to other
foreign markets, especially with products that have significant environmental
impacts, such as paints and inks.

In addition, the Company has obtained the services of two manufacturer's
representatives to represent the Company's paint additives business and has
initiated discussions with six other manufacturer's representatives. The Company
is also exploring potential distribution channels for a new line of VOC Free
automotive paints. The Company has also begun discussions with a potential
manufacturer's representative for paint in the European maritime industry.

ADDITIONAL FINANCING

The Company believes that the minimum proceeds of this Offering will
allow the Company to meet all of its presently planned future operations for at
least twelve months. However, the Company's anticipated development projects may
require a substantial amount of funds in order to fully develop these proposed
future products to their fullest potential. (See "Use of Proceeds" and
"Financial Statements.") The proceeds of this Offering may be inadequate to
permit the Company to achieve its research objectives, and there can be no
assurance that the Company will be able to raise additional funds when needed on
terms acceptable to the Company, if at all. (See "Risk Factors - Additional
Capital.")

COMPETITION

In each of the product areas in which the Company operates it is subject to
competition from firmly established, very large and very numerous competitors
which have far greater resources, staffs, facilities and reputations than those
possessed by the Company. The same will be true after this offering. There can
be no assurance that the Company will be able to sell its products successfully
in light of this competition, or that if it does succeed in selling its products
initially that the Company will be able to withstand attempts by these
competitors to market against the Company. Further, there can be no assurance
that any new market opened by the Company will not become the object of efforts
by these competitors to take over these markets. Also, there can be no assurance
that new products will not be developed by these competitors that are superior
to or marketed more successfully than the Company can market its products. In
the event that the Company cannot successfully compete against these larger
companies the business of the Company will be materially and adversely affected.

EMPLOYEES

The Company employs a President and an Executive Vice President for
Scientific Affairs. In addition, the Company employs one chemical technician,
two commission only marketing representatives, and one part-time secretary.
During the next twelve months the Company anticipates opening several production
facilities requiring the acquisition of about one hundred production personnel,
plant management and technical sales representatives. There can be no assurance
that the Company will be able to hire such personnel or if hired retain their
service.

PROPRIETARY RIGHTS

The Company relies on a combination of patent and trade secret laws,
nondisclosure and other contractual agreements and technical measures to protect
its proprietary rights in its products. Despite these precautions, unauthorized
parties may attempt to copy aspects of the Company's products or to obtain and
use information that the Company regards as proprietary.

The Company believes that its products, trademark and other proprietary
rights do not infringe on the proprietary rights of third parties. There can be
no assurance, however, that third parties will not assert infringement claims
against the Company in the future. (See "Risk Factors - Product Protection and
Infringement.") In the event that pending applications are not granted, or if
subsequently obtained patents are either invalidated or designed around, the
Company would be materially and adversely affected.

FACILITIES

The Company leases 4,000 square feet of industrial space and 2,000 square
feet of office space under a three year lease with an option to extend the lease
for three years at 163 South St. in Hackensack, New Jersey. The lease contains
cost of living increases and current rent payments, including taxes, are $3,513
per month. The Company anticipates renting additional production facilities upon
the successful conclusion of this offering as required by demand for the
Company's products.

MANAGEMENT

The names of the Officers and Directors of the Company, their ages and
positions with the Company are as follows:

Name Age Position

Roger Fidler 49 President, Director

Gerald Sugerman 61 Executive Vice President,Secretary,
Treasurer, Director

James Wright 66 Director

Albert Mersberg 59 Director

George J. Barenholtz 62 Director

The above officers and directors will hold office until the next annual meeting,
or until their successors are elected and qualified.

MANAGEMENT

Roger L. Fidler Mr. Fidler has been President of the Company and a director
of the company since inception in July 1994. Until February, 1999, Mr. Fidler
devoted a minimal amount of his time to the Company. Starting in February, 1999,
he has devoted about half of his time to the Company. He has been continuously,
and is presently, engaged in the private practice of law as a sole proprietor
since 1983 and has held several directorships in both private and public
corporations. During the time period from 1992 to the present, Mr. Fidler has
been employed both as President of the Company and engaged in the private
practice of law. He is currently President and Sole Director of D-Lanz
Development Group, Inc. a public company. Mr. Fidler holds degrees in Law (J.D.)
from the University of South Carolina, Columbus, South Carolina (1977), in
Physics (M.S.) from the University of Illinois Urbana, Illinois (1974) and a
B.S. from Dickinson College (1972), Carlisle, PA.

Gerald Sugerman, Ph.D. Dr. Sugerman has served full time as Executive Vice
President, Sectretary, Treasurer, and as a director of the Company since
inception in July of 1994. As PPA's Chief Scientist he is in charge of all
technical developments. From February, 1992 until July, 1994, Dr. Sugerman was
President of Pi-Tech Inc., a specialty chemical company. Dr. Sugerman received
his Ph.D. in organic chemistry from Fordham University in 1960, and holds
several other degrees. He has authored over 100 papers and holds more than fifty
patents. Dr. Sugerman is also a director and minority shareholder in Blue Ridge
Technologies, Inc., a related party.

James Wright Mr. Wright has been a director since inception. Mr. Wright is
a retired businessman who until 1989 was a principal in a sand and gravel mining
company in New Jersey. Mr. Wright holds a Bachelor of Science degree in Business
Administration from Rider University (B.S. 1961), Lawrenceville, New Jersey. Mr.
Wright serves on the Audit Committee.

Albert Mersberg Mr. Mersberg became a director of the Company in September,
1997. He had previously consulted for the Company from inception until November,
1996. He is currently President of Blue Ridge Technologies, Inc., a related
party to the Company by virtue of having two common directors and one common
shareholder, where he had been employed since July 1999. He was previously
employed at Blue Ridge Paint, Inc. of Henry Va, where he was a Technical manager
from June, 1998 until July, 1999. From December, 1996 to June, 1998 Mr. Mersberg
was the Technical Manager of New Product Development for Sampson Coatings, Inc.
of Richmond, VA. Prior to that, Mr. Mersberg was employed by Lawrence McFadden
Co. in Philadelphia, PA from 1991 to December, 1996 in a similar capacity. He
holds a B.S. degree in Chemistry from the State University of New York at
Buffalo.

George J. Barenholtz will become a director of the Company upon the
successful conclusion of this offering as the designee of the Underwriter. Since
1991 Mr. Barenholtz has been acting as a private investor and business
consultant out of Montclair, New Jersey. Prior to that, from 1987 to 1991 Mr.
Barneholz had been the Chairman of the Board and Chief Executive Officer of the
Merocel Corporation in Mystic, Connecticut. Mr. Barenholtz holds degrees in
business (M.B.A.) from the Baruch School of Business (1973), in chemistry (M.S.)
from Case Western Reserve University (1961), and in engineering (B.Sc.) from the
University of Alberta (1959).

REMUNERATION OF OFFICERS AND DIRECTORS

No officer of the Company has received compensation since inception in
July, 1994 except Dr. Sugerman, Exec. V.P. of the Company. Directors are not
compensated for serving on the Board of Directors. No contingent forms of
remuneration, property, or other benefits were conferred during that period.

The Company has entered into written employment and assignment agreements
with Gerald Sugerman and Roger Fidler. Pursuant to these Agreements, Mr.
Sugerman assigned his rights to any and all technologies and improvements
thereto to the products presently marketed by the Company and which he may
develop from time to time while employed by the Company. Mr. Fidler's contract
was modified with his consent to provide that his salary will commence upon
completion of financing or gross profits in excess of $30,000 per month. The
capacity and annual salaries for key management is set forth below.

Summary Compensation Table

Fiscal Annual Compensation Long Term
Name & Position Year Salary Bonus Other(1) Compensation

Roger Fidler Current -0-(2) -0- $500,000 -0-

President 1998 -0-(2) -0- -0- -0-
1997 -0-(2) -0- -0- -0-
1996 -0-(2) -0- -0- -0-

Gerald Sugerman Current $120,000(3) -0- -0- -0-
Executive Vice 1998 $120,000(3) -0- -0- -0-
President; 1997 $120,000(3) -0- -0- -0-
Director 1996 $120,000(3) -0- -0- -0-

(1) Mr. Fidler's contract provides for sale commissions which have not
been earned to the date of this Prospectus. The $500,000 in non-cash
compensation is the result of the exercise of options on 100,000
shares at $1.00 per share. Mr. Sugerman's contract provides for
royalties of 5% on sales to a maximum of $350,000 in payments, and 2%
of sales thereafter.

(2) Mr. Fidler's contract provides for his base compensation of $120,000
to begin either after financing has been completed or the Company
reaches $30,000 per month in gross income. Neither of these conditions
has been met yet, and therefore Mr. Fidler has not yet received any
remuneration from the Company.

(3) Mr. Sugerman has been accruing $10,000 per month as part of his
remuneration agreement with the Company. This amount has been
converted into preferred stock on various occasions, as noted in the
Financial Statements.

STOCK OPTION INFORMATION

The following table sets forth certain information with respect to the
value of stock options held by the Named Executive Officers and Directors for
through the period ended December 31, 1999.

Fiscal Year-End Option Value Table

Number Of Securities Value of Unexercised
Shares Underlying Unexercised In-the-Money Options at
Acquired Options On Dec. 31, 1999 December 31, 1999($)(1)(2)(3)
On Value ------------------------ ------------------------

Exercise Realized Exercisable Unexercisable Exercisable Unexercisable

Roger Fidler -0- -0- 445,000 -0- 2,100,000 -0-

Gerald Sugerman -0- -0- 850,000 -0- 4,200,000 -0-

James Wright -0- -0- 100,000 -0- 500,000 -0-

Albert Mersberg -0- -0- 5,000 -0- 25,000 -0-

- -----------

(1) Based upon an assumed initial public offering price of $6.00 per share of
Common Stock. (2) Options are in-the-money if the fair market value of the
Common Stock exceeds the exercise price. (3) Represents the total gain which
would be realized if all the in-the-money options beneficially held at December
31, 1999 were exercised, determined by multiplying the number of shares
underlying the options by the difference between the per share option exercise
price and $6.00, the fair market price as of the initial public offering date,
as determined by the offering price.

EMPLOYEE STOCK OPTION PLAN INFORMATION

The Company has adopted a Stock Grant Program and a Stock Option
Program. The Stock Grant Program provides for the issuance to officers,
directors and key employees stock grants as determined by the Board of
Directors. The recipient must continue employment with the Company for two years
after the grant is made or forfeit the stock. The stock option program is also
available for officers, directors and key employees and permits the Board to
issue options which are exercisable in equal amounts over a five year period.
Any unvested options expire upon the termination of employment with the Company.
To the date of this Prospectus, no stock options have been issued pursuant to
the Stock Option Program and no grants were made under the Stock Grant Plan.

CERTAIN TRANSACTIONS

The Company was organized primarily through the efforts of Roger Fidler and
incorporated on July 22, 1994 under the laws of the State of New Jersey. On July
29, 1994, the Company's Board of Directors approved the issuance of 75 shares
each to Mr. Fidler and James Wright as consideration for organizational expenses
and services valued at $100 each.

On October 24, 1994, an agreement was made by which the Company acquired
certain license rights in return for the assumption of certain liabilities and
the issuance of 975 Shares to Gerald Sugerman.

Effective November 1, 1994, the Company entered into a two year employment
contract with Gerald Sugerman which provides for salary of $120,000 per annum.
In June, 1996 the Company entered into a five year employment agreement with Dr.
Sugerman requiring the payment of $10,000 per month plus 5% royalty on sales he
makes up to a maximum salary of $350,000. In addition, he receives life
insurance equal to twice his annual salary, disability insurance, vacation pay,
and sick leave.

On February 5, 1996, the Company entered into an employment agreement with
Roger Fidler by which Mr. Fidler's salary would be set by the Board of Directors
from time to time. This salary will commence at the rate of $10,000 per month
when the Company has additional financing of $2,000,000 or more, or gross
profits exceeding $30,000 per month. In addition, Mr. Fidler receives commission
on gross sales of between 10% and 15% on sales initiated by him. No such sales
have been made to the date of this Prospectus.

Roger Fidler and Gerald Sugerman have from time to time loaned the Company
cash, or have expended cash on behalf of the Company. These loans totalled
through March 31, 1999, $166,540 which are evidenced by notes bearing 6%
interest and due January 1, 2001. The intent of the Company is to pay these
notes from either profits or future financing.

Blue Ridge Technologies, Inc., a Virginia corporation, on which board of
directors Gerald Sugerman and Albert Mersberg, both directors of the Company,
also serve and in which Gerald Sugerman is a significant minority shareholder,
leases certain equipment from the Company for $850 per month.

The transactions between officers and directors of the Company and the
Company and its affiliates are made on terms no less favorable to the Issuer
than those available from unaffiliated parties. Future transactions will be
handled in the same fashion.

PRINCIPAL SHAREHOLDERS

The following table sets forth information with respect to the share
ownership, both before and after the prospective closing of the offering made
hereby, of the Company's common stock by its officers and directors, both
individually and as a group, and by the present record and/or beneficial owners
of more than 5% of the outstanding amount of such stock:

Number of Percentage(2) Percentage(2) Percentage(2)
Name Shares of shares of shares shares
Owned Owned Prior After After
to Offering Offering Offering
(Maximum) (Minimum)
Gerald

Sugerman(1) 1,825,000 71.6% 47.1% 68.9%
8 Cambridge Dr
Allendale, NJ 07401

Roger Fidler(1) 620,000 28.9% 15.49% 27.6%
400 Grove Street
Glen Rock, NJ 07452

James Wright 175,000 9.74% 2.9% 9.2%
244C Mayflower Way
Jamesburg, NJ 08831

Officers
and Directors
as a Group(5 persons) 2,620,000 110.24% 65.49% 105.7%

- -----------------

(1)Gives effect to 445,000, 850,000 and 100,000 shares underlying options held
by Fidler, Sugerman, and Wright respectively. Due to the method of computing
percentages of beneficial ownership required by federal regulation the totals
exceed 100%

(2) Does not give effect to (i)up to 1,000,000 shares of Common Stock issuable
upon the exercise of the Class A Unit Warrants; (ii) the common stock underlying
the Underwriter's Over Allotment Option (150,000 shares); and (iii) the common
shares underlying the Underwriter's Warrant Units (200,000 shares). See
"Underwriting" and "Certain Transactions."

DESCRIPTION OF SECURITIES

Preferred Stock

The authorized capital stock of the Company consists in part of 1,000,000
shares of Preferred Stock, $100 par value per share (the "Preferred Stock"). The
Company's present issued and outstanding number of Preferred shares is 4,806.
The holders of Preferred Stock have preference as to liquidation, receive a 5%
dividend, and may have their shares redeemed by the Company at par value plus
accrued dividends during a five year period.

Common Stock

The authorized capital stock of the Company consists of, in part,
10,000,000 shares of Common Stock, without par value (the "Common Stock"). The
Company's present issued and outstanding number of common shares is 1,697,500.
The holders of Common Stock have equal ratable rights to dividends from funds
legally available therefor, when, as and if declared by the Board of Directors
of the Company; are entitled to share ratably in all of the assets of the
Company available for distribution to holders of Common stock upon liquidation,
dissolution or winding up of the affairs of the Company; do not have preemptive,
subscription or conversion rights and there are no redemption or sinking fund
provisions applicable thereto. Such shares are entitled to one vote per share on
all matters which stockholders may vote on at all meetings of shareholders. All
shares of Common Stock now outstanding are fully paid and nonassessable and all
shares of Common Stock which are the subject of this Offering, when issued, will
be fully paid and nonassessable.

Non-Cumulative Voting

The holders of shares of Common Stock of the Company do not have cumulative
voting rights. Thus, the holders of more than 50% of such outstanding shares,
voting for the election of directors, can elect all of the directors to be
elected, and in such event, the holders of the remaining shares will not be able
to elect any of the Company's directors. If the shares offered hereby are sold,
the present shareholders will own approximately 60.9% of the Company's
outstanding shares. If the options held by management were exercised, the
present shareholders would own 73.9% of the Company's outstanding shares, and in
either event, will remain in a position to elect all of the members of the Board
of Directors. Further, if Mr. Sugerman, Executive Vice President of the Company,
exercised his options only, he would own approximately 53.6% of the Company's
Common Stock and would therefore control the Company. (See "Principal
Shareholders").

Transfer Agent and Registrar

The Company has chosen Jersey Transfer & Trust Company of Verona, New
Jersey as its transfer agent.

Reports to Shareholders

Dividends

UNDERWRITING

The Underwriters named below (the "Underwriters"), for whom Kenneth Jerome
& Company, Inc. is acting as Representative, have severally agreed, subject to
the terms and conditions of the Underwriting Agreement (the "Underwriting
Agreement") to purchase from the Company and the Company has agreed to sell to
the Underwriters on a firm commitment basis, the respective number of units of
Common Stock and Redeemable Warrants as set forth opposite their names:

Underwriter Number of Units

Kenneth Jerome & Company, Inc............ 100,000

Total.................................... 100,000

The Underwriters are committed to purchase 100,000 Units of the Securities
offered hereby, if any of such Securities are purchased.

The Company has been advised by the Representative that the Underwriters
propose initially to offer the Securities to the public at the public offering
prices set forth on the cover page of this Prospectus and to certain dealers
less concessions of not in excess of $0.60 per unit. Such dealers may reallow a
concession not in excess of $0.60 per unit to other dealers. After the
completion of this Offering, the public offering prices, concessions and
reallowances may be changed by the Representative.

The Representative has advised the Company that it does not anticipate
sales to discretionary accounts by the Underwriters to exceed ten (10%) percent
of the total number of Securities offered hereby.

The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act, or to contribute to
payment that the Underwriters may be required to make. The Company has also
agreed to pay to the Representative an expense allowance on a non-accountable
basis equal to three percent (3%) of the gross proceeds derived from the sale of
the Securities underwritten.

Also, the Company is selling 900,000 additional units which are being
offered through the Underwriters on a "best efforts" basis, subject to the terms
and conditions of the Underwriting Agreement. The commissions paid on the best
efforts offering will be 9% of the gross proceeds, $0.54 per Unit. The offering
will terminate 90 days after the Effective Date, unless extended for an
additional sixty (60) days by agreement between PPA and the Underwriter. There
will be no escrow account. All subscriptions will be accepted or rejected within
one day of receipt. With respect to the best efforts portion of the offering,
any funds received by the Underwriters will be transmitted promptly to the
Company not later than noon of the day following receipt of any such funds.

The Underwriters have been granted an option by the Company, exercisable
within 45 days after the date of this Prospectus, to purchase up to an
additional 15,000 units at the initial public offering price per unit offered
hereby, less underwriting discounts and the expense allowance. Such option may
be exercised only for the purpose of covering over-allotments, if any, incurred
in the sale of the Securities offered hereby by firm commitment. To the extent
such option is exercised in whole or in part, each Underwriter will have a firm
commitment, subject to certain conditions, to purchase the number of the
additional units proportionate to its initial commitment.

Shareholders who currently hold four percent (4%) or more of the Company's
outstanding shares have agreed to "lock-up" their securities (i.e. not to sell,
grant any option for sale, or otherwise dispose of, directly or indirectly, any
shares they hold) of the Company's Common Stock or other securities of the
Company which they hold for a period of twelve months from the date of the
consummation of the Offering.

The holders of 1,500,000 outstanding shares of Common Stock, including all
of the Company's directors, officers and principal stockholders, have agreed not
to directly or indirectly, offer to sell, contract to sell, sell, transfer,
assign, encumber, grant an option to purchase, pledge or otherwise dispose of
any beneficial interest in such securities for a period of 12 months following
the date of this Prospectus without the prior written consent of the
Representative. An appropriate legend shall be marked on the face of the
certificates representing all of such securities.

The Company has agreed that, for three years after the date of this
Prospectus, it will use its best efforts to cause one individual designated by
the Representative, if any, to be elected to the Company's Board of Directors.
Such individual may be a director, officer, employee or affiliate of the
Representative. In the event the Representative elects not to designate a person
to serve on the Company's Board of Directors, the Representative may designate a
person to attend meetings of the Board of Directors. The representative has
designated George Barenholtz as its initial appointed director. See,
"Management."

Prior to this Offering, there has been no public market for the Securities.
Consequently, the initial public offering prices of the Securities and the terms
of the Redeemable Warrants have been arbitrarily determined by negotiations
between the Company and the Representative and are not necessarily related to
the Company's asset value, net worth or other established criteria of value. The
factors considered in such negotiations, in addition to prevailing market
conditions, include the history of and prospects for the industry in which the
Company competes, an assessment of the Company's management, the prospects of
the Company, its capital structure and certain other factors as were deemed
relevant.

The foregoing is a summary of the principal terms of the agreements
described above and does not purport to be complete but does include all
material terms . Reference is made to a copy of each such agreement which is
filed as an exhibit to the Registration Statement.

The Company also agreed to indemnify the Representative against certain
liabilities, including liabilities under the Securities Act, or to contribute to
related payments that the Representative may be required to make. In addition,
the Company granted the Representative, for a period of five years commencing on
the final closing of this offering a right of first refusal to be the managing
underwriter or placement agent for any securities to be offered by the Company.

The Company will also sell to the Representative warrants (the
"Underwriter's Warrants") to purchase up to 100,000 Units at a price $9.90 per
Unit. The purchase price of these warrants is $0.001 per warrant. The
Underwriter's Warrants will be exercisable for a period of four years commencing
one year after the Effective Date of this Offering, at an initial per Unit
exercise price of 165% of the offering price per Share. The Underwriter's
Warrants cannot be transferred, assigned or hypothecated for one year from the
date of their issuance, except that they may be assigned, in whole or in part,
to any successor, officer or partner of the Underwriter (or to officers and
partners of any such successor or partner). The Underwriter's Warrants will
contain anti-dilution provisions providing for appropriate adjustment of the
exercise price and number of Shares which may purchased upon exercise upon the
occurrence of certain events. The anti-dilution provisions of the Underwriter's
Warrants generally are triggered by the issuance of Common Stock (or securities
convertible or exchangeable into common stock) by the Company at prices below
the market price of the Common Stock at the time of such issuance (subject to
certain exceptions), as well as stock splits, stock dividends and other similar
dilutive events in which the Company increases its outstanding stock without
receiving additional consideration.

The Company has agreed that it will, upon request of the Representative
within the four-year period commencing one year from the Effective Date,
register the Underwriter's Warrants and the underlying securities once at the
Company's expense. The Company has also agreed, during the four-year period
commencing one year from the Effective Date, to register on a "piggy-back"
basis, and on an unlimited number of occasions, the Underwriter's Warrants and
the underlying securities whenever the Company files a Registration Statement.
See "Risk Factors - Underwriter's Warrants."

LITIGATION

There is no pending or threatened litigation involving the Company, except
that one of the Company's bridge note purchasers has sued for collection in the
Superior Court of New Jersey. The Company believes that it has a meritorious
counterclaim in this action and management intends to defend this legal action
vigorously. However, the Company has also allocated a sufficient amount of the
proceeds of this Offering to effect a complete pay-off of the debt comprising
the subject matter of this action.

LEGAL MATTERS

The validity of the shares of Common Stock offered hereby are being passed
upon for the Company by Jay Hait, Esq., 130 William St., Suite 807 New York, NY
10038. The Law Office of Roger Fidler is owed $150,000 for services rendered in
connection with this offering. Mr. Fidler is the beneficial owner of 175,000
shares of the Company's Common Stock, holds an option to acquire 445,000 more
shares, and from inception until the date of this Prospectus was and is a
director and president of the Company. Mr. Hait is the beneficial owner of
31,000 shares of the Company's Common Stock. The Underwriter is represented by
Steven I. Gutstein, Esq., 276 Fifth Avenue, New York, New York 10001.

EXPERTS

The financial statements of PPA Technologies, Inc. for the years ending
June 30, 1999 and June 30, 1998 included elsewhere in this Prospectus have been
included herein and in reliance upon the report of Thomas P. Monahan, CPA, an
independent certified public accountant, appearing elsewhere herein, and upon
the authority of said firm as an expert in accounting and auditing.

ADDITIONAL INFORMATION

The Company will not become subject to the reporting requirements of
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 until
completion of this Offering. The Company has filed with the Securities and
Exchange Commission (the "Commission"), Washington, D.C. 20549, a Registration
Statement on Form S-1, including amendments thereto, under the Act with respect
to Securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement and the exhibits and
schedules filed therewith, certain portions of which have been omitted as
permitted by the rules and regulations of the Commission. For further
information with respect to the Company and the Securities offered hereby,
reference is hereby made to such registration statement and to the exhibits and
schedules filed therewith. Statements contained in the Prospectus regarding the
contents of any contract or other document referred to are not necessarily
complete and, in each instance, reference is made to the copy of such contract
or other document filed as an exhibit to the registration statement, each such
statement being deemed to be qualified in its entirety by such reference. The
registration statement, including all exhibits and schedules thereto, may be
inspected without charge at the principal office of the Commission, Public
Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549-1004, and at the
regional offices of the Commission located at Northwestern Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and at 7 World
Trade Center, Suite 1300, New York, New York 10048 and copies of all or any part
thereof may be obtained from such offices upon the payment of prescribed fees.

THOMAS P. MONAHAN
CERTIFIED PUBLIC ACCOUNTANT
208 LEXINGTON AVENUE
PATERSON, NEW JERSEY 07502
(201) 790-8775
Fax (201) 790-8845

To The Board of Directors and Shareholders
of PPA Technologies, Inc.

I have audited the accompanying balance sheet of PPA Technologies, Inc. as
of June 30, 1999 and the related statements of operations, cash flows and
shareholders' equity for the years ending June 30, 1998 and 1999. These
financial statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial statements based on
my audit.

I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I 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 and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of PPA Technologies, Inc. as of
June 30, 1999 and the results of its operations, shareholders equity and cash
flows for the years ending June 30, 1998 and 1999 in conformity with generally
accepted accounting principles.

The accompanying financial statements have been prepared assuming that
PPA Technologies, Inc. (a development stage company) will continue as a going
concern. As more fully described in Note 2, the Company has incurred operating
losses since inception and requires additional capital to continue operations.
These conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans as to these matters are described in Note
2. the financial statements do not include any adjustments to reflect the
possible effects on the recoverability and classification of assets or the
amounts and classifications of liabilities that may result from the possible
inability of PPA Technologies, Inc. (a development stage company) to continue as
a going concern.

s/Thomas Monahan
----------------------
Thomas P. Monahan, CPA
September 23, 1999
Paterson, New Jersey

PPA TECHNOLOGIES, INC.
(A Development Stage Company)
BALANCE SHEET
June 30, December 31,
1999 1999
------------- -------------
Assets

Current assets
Cash $ 9,539 $7,063
Accounts receivable 6,099 287
Inventory 88,592 45,532
------- ------
Total current assets 104,230 52,882

Capital assets-net 107,750 102,663

Other assets
Security deposit 5,000 5,000
License 1,350 1,350
------- -----
6,350 6,350
------- -----
Total Assets $218,330 $161,895
======= =======

LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities
Accounts payable and accrued expenses $165,168 $206,667
Notes payable-short term portion 464,900 487,250
Officer loan payable 188,301 278,831
------- -------
Total current liabilities 818,369 972,748

Stockholders Equity
Common Stock-10,000,000 common shares
authorized, no par. At June 30, 1999,
and December 31, 1999, the number
of shares outstanding was 1,697,500
and 1,697,500 respectively 736,750 736,750

Preferred Stock-1,000,000 preferred
shares authorized, $100 par value.
At June 30, 1999 and December 31, 1999,
the number of shares oustanding was 4,806
and 4,806 respectively . 480,600 480,600

Deficit accumulated during development stage (1,817,389) (2,028,203)
-------- ---------
Total stockholders equity (600,039) (810,853)
------- ---------
Total liabilities and stockholders equity $218,330 $161,895
======== =========

See accompanying notes to financial statement

PPA TECHNOLOGIES, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS

For the
period from
For the For the For the For the inception,
year year six months six months July 22,
ended ended ended ended 1994 to
June 30, June 30, December 31, December 31, December 31,
1998 1999 1998 1999 1999
--------- ------- ------------ ------------ ---------

Sales $148,537 $101,272 $56,132 $11,171 $778,868

Cost of goods sold 95,687 54,696 32,906 3,764 498,204
------- ------ ------- ----- -------

Gross profit 52,850 46,576 23,226 7,407 280,664

Operating expenses
General and
administrative 429,109 269,660 154,753 129,253 1,459,736
Bad debt expense 41,875 68,139 57,139 110,014
Non cash compensation
charges 500,000 500,000
Research and
development 50,243 54,644 34,644 45,000 149,887
Depreciation 8,031 33,794 8,084 16,831 78,497
------ ------ ------ ------ --------
Total operating
expenses 1,029,258 426,237 254,620 191,084 2,188,120

(Loss) from operations (976,408)(379,661) (231,394) (183,677) (1,907,456)

Other expenses
Interest expense (43,385) (47,160) (22,350) (27,137) (120,747)
-------- ------ ------- -------- ---------
Total other expenses (43,385) (47,160) (22,350) (27,137) (120,747)

Net loss $(1,019,793$(426,821)$(253,744) $(210,814) $(2,028,203)
========== ======= ======= ======== ==========

Net loss per share
basic and diluted $(.15) $(0.09) $(0.02) $(0.05) $(.45)
==== ==== ===== ==== ====

Weighted average
number of shares
outstanding basic
and diluted 3,555,067 4,516,291 4,516,291 4,516,291 4,516,291
========= ========= ========= ========= =========

See accompanying notes to financial statements.

For the For the
three three
months months
ended ended
December 31, December 31,
1998 1999
Unaudited Unaudited
--------- ---------

Sales $ 9,863 $6,023

Cost of goods sold 5,288 2,134
------ -------

Gross profit 4,575 3,889

Operating expenses
General and
administrative 71,748 63,886
Bad debts 57,139
Research and
development 25,000 20,000
Depreciation 6,000 8,777
------ ------
Total operating
expenses 159,887 92,663

(Loss) from operations (155,312) (88,774)

Other expenses
Interest expense (11,175) 15,152
-------- --------
Total other expenses (11,175) 15,152

Net loss $(166,487) $(103,926)
========= =======

Net loss per share
basic and diluted $(.02) $(0.02)
======= =======

Weighted average
number of shares
outstanding basic
and diluted 4,516,291 4,516,291
========= ==========

See accompanying notes to financial statements.

PPA TECHNOLOGIES, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES

Net profit (loss) $(1,019,793)$(426,821) $(253,744) $(210,814) $(2,028,203)
Depreciation 8,031 33,794 8,084 16,831 78,497
Non cash common stock
compensation 500,000 500,000
Non cash preferred
stock compensation 76,153 30,000 106,153

Adjustments
Accounts receivable (3,975) 609 ( 4,722) 5,812 (287)
Inventory (16,748) (29,167) (761) 43,060 (45,532)
Accounts payable and
accrued expenses 20,146 127,339 46,012 41,499 206,667
------- ------- ------ ------ -------
TOTAL CASH FLOWS
PROVIDED (USED) FROM
OPERATIONS (424,165) (294,246) (194,165) (103,612) (1,182,705)

CASH FLOWS FROM INVESTING ACTIVITIES
Accounts receivable
related party (41,876) (41,876) License
Fee (1,350)
Security deposit (5,000)
Capital asset additions (128,012) (5,025) ( 926) (11,744) (181,160)
-------- ------- ------- ------- -------
TOTAL CASH FLOWS
PROVIDED (USED)FROM
INVESTING ACTIVITIES (169,890) 36,851 (42,802) (11,744) (187,510)

CASH FLOWS FROM FINANCING ACTIVITIES
Officer loan (43,834) 185,734 92,513 90,530 278,831
Preferred stock 71,347 36,500 6,500 374,447
Notes payable 170,885 44,700 22,350 22,350 487,250
Sale of common stock 185,000 236,750
------- ------- ------ -------- -------
CASH FLOWS PROVIDED
(USED) FROM FINANCING
ACTIVITIES 383,398 266,934 121,363 112,880 1,377,278

NET INCREASE (DECREASE (210,657) 9,539 -0- (2,476) 7,063
CASH BALANCE BEGINNING
OF PERIOD 210,657 -0- -0- 9,539 -0-
-------- ------- --------- --------- ---------
CASH BALANCE END OF
PERIOD $-0- $9,539 $-0- 7,063 $7,063
======== ======= ========= ========= ========

See accompanying notes to financial statements

PPA TECHNOLOGIES, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS EQUITY
Deficit
accumulated
during Common Common Preferred
Preferred development
Date Stock Stock Stock Stock stage Total
---- ------ ----- --------- --------- ------------ -------

7-22-1994(1) 150 $100 $100
7-24-1994(2) 1,350 1,350 1,350
6-30-1995 Net loss (111,797) (111,797)
--------- ----- --------- --------- -------- -------
6-30-1995 1,500 1,450 (111,797) (110,347)
========= ===== ========= ========= ======== =======

5-31-1996(3) 30,000 300 300
6-28-1996(4)1,500,000 1,450 1,450
6-30-1996(5) 25,000 50,000 50,000
6-30-1996(6) 2,966 296,600 296,600
6-30-1996 Net loss (114,715) (114,715)
-------- ------ -------- -------- ------- -------

6-30-1996 1,555,000 51,750 2,966 $296,600 $(226,512) $121,838

6-30-1997 Net loss (144,263) (144,263)
-------- ------- ------- -------- ------- --------

6-30-1997 1,555,000 $51,750 2,966 $296,600 $(370,775) $(22,425)
6-30-1998(5) 42,500 85,000 85,000
6-30-1998(7) 100,000 100,000 100,000
6-30-1998(7) 500,000 500,000
6-30-1998(6) 1,475 147,500 147,500
6-30-1998 Net loss (1,019,793)(1,019,793)
-------- ------- -------- -------- --------- ---------

6-30-1998 1,697,500$736,750 4,441 $444,100 $(890,568) $(209,718)

6-30-1999(6) 365 $36,500 36,500
6-30-1999 Net loss (426,821) (426,821)
-------- ------- -------- -------- --------- --------
6-30-1999 1,697,500$736,750 4,806 $480,600 $(1,817,389) $(600,039)

Unaudited
Net loss (210,814) (210,814)
-------- ------- -------- -------- --------- --------
12-31-1999 1,697,500$736,750 4,806 $480,600 $(2,028,203) $(810,853)
========= ======= ========= ======== ========== =======

(1) Sale of 150 shares of common stock for $100.
(2) Exchange of shares of common stock for acquisition of license agreement. (3)
30 shares of Common stock sold Pursuant to Reg. D at $10 per share restated
to 30,000 shares post forward split at $.01 per share.
(4) Forward split of common shares in a ratio of 1,000 to 1.
(5) Private placement of 25,000 shares of common stock at $2.00 per share for
$50,000.
(6) Conversion of debt into preferred stock at $100 par value each by Gerald
Sugarman.
(7) Issuance of compensatory stock to Mr. Roger Fidler

See accompanying notes to financial statements.

PPA TECHNOLOGIES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999

Note 1. Organization of the Company and Issuance of Capital Stock

a. Creation of the Company

PPA Technologies, Inc. (the "Company") was incorporated on July 22,1994
under the laws of the State of New Jersey with an authorized number of common
shares of 2,500 no-par value. On June 20, 1996, the certificate of incorporation
was amended changing the number of common shares authorized to 10,000,000, no
par value each and 1,000,000 preferred shares, $100 par value each.

b. Description of the Company

The Company has under development and will manufacture and distribute
specialty chemicals and chemical additives.

c. Issuance of Common stock

On July 23, 1994, the Company sold 75 shares of common stock to Roger
Fidler and 75 shares of common stock to James Wright for a total consideration
of $100.

On July 24, 1994, the Company acquired certain patented technologies from
Broadwater Developments, Inc. ("Broadwater"), a British Columbia corporation for
375 shares of common stock and Gerald Sugerman for 975 shares of common stock
relating to coupling agents to be used as paint additives. The Company has
assigned a value of $1.00 per share of common stock or $1,350 as the cost basis
of this transaction.

On May 31, 1996, the Company sold, pursuant to a private placement under
"Rule 504" of the Securities Act of 1933, as amended, an aggregate of 30 shares
of common stock at $10.00 per share for an aggregate consideration of $300.

On June 28, 1996, the Company forward split the number of common shares
outstanding in the ratio of 1,000 to 1 restating the number of common shares
outstanding from 1,500 to 1,500,000.

As of June 30, 1996, the Company sold 25,000 shares of common stock at
$2.00 per share for a total of $50,000 through a private placement.

As of July, 1997, the Company sold 42,500 shares of common stock for
aggregate consideration of $85,000 or $2.00 per share.

As of June 30 1998, Mr. Fidler exercised 100,000 options into 100,000
shares of common stock for and aggregate consideration of $100,000. In addition
the Company recognized $500,000 as non cash compensation for an aggregate
consideration of $600,000 or $6.00 per share.

d. Issuance of Preferred Stock

On June 30, 1996, the Company issued 2,966 shares of preferred stock to
Gerald Sugerman in exchange for moneys due plus accrued and unpaid salary and
moneys advanced to the Company aggregating $296,600 including accrued interest.

As of June 30, 1998, the Company issued 1,475 shares of preferred stock
to Gerald Sugerman in exchange for moneys due for accrued and unpaid salary and
moneys advanced to the Company during the period July 1, 1997 through June 30,
1998 aggregating $147,500 including accrued interest.

As of June 30, 1999, the Company issued 365 shares of preferred
stock to Gerald Sugerman in exchange for moneys due for accrued and unpaid
salary and moneys advanced to the Company during the period July 1, 1998 through
December 31, 1998 aggregating $36,500 including accrued interest.

Note 2. Summary of Significant Accounting Policies

a. Basis of presentation

The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. The Company incurred net losses of
$2,028,203 for the period from inception July 22, 1994 to December 31, 1999.
These factors indicate that the Company's continuation as a going concern is
dependent upon its ability to obtain adequate financing. The Company is
anticipating that with the completion of a public offering and with the increase
in working capital, the Company will experience an increase in sales. The
Company will require substantial additional funds to finance its business
activities on an ongoing basis and will have a continuing long-term need to
obtain additional financing. The Company's future capital requirements will
depend on numerous factors including, but not limited to, continued progress
developing its source of inventory, continued research and development and
initiating marketing penetration. The Company plans to engage in such ongoing
financing efforts on a continuing basis.

The financial statements presented at June 30, 1999 consist of the
balance sheet as at June 30, 1999 and the statements of operations, cash flows
and stockholders equity for the year ended June 30, 1998 and 1999.

The unaudited financial statements presented at December 31, 1999 consist
of the unaudited balance sheet as at December 31, 1999 and the unaudited
statements of operations, cash flows and stockholders equity for the six months
ended December 31, 1998 and 1999

b. Cash and Cash Equivalents

The Company treats temporary investments with a maturity of less than six
months as cash.

c. Property and equipment

Depreciation of property and equipment is computed using the
straight-line method over five years. Amortization of leased equipment is
computed using the straight-line method over the shorter of the estimated useful
lives of the assets or the lease term. Amortization of leasehold improvements is
computed using the straight-line method over the shorter of the estimated useful
lives of the assets or the remaining lease term.

d. Earnings per share

In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, EARNINGS PER SHARE
("Statement No. 128"). Statement No. 128 applies to entities with publicly held
common stock or potential common stock and is effective for financial statements
issued for periods ending after December 15, 1997. Statement No. 128 replaces
APB Opinion 15, Earnings per Share ("EPS"). Statement No. 128 requires dual
presentation of basic and diluted earnings per share by entities with complex
capital structures. Basic EPS includes no dilution and is computed by dividing
net income by the total number of common shares outstanding for the period.
Diluted EPS reflects the potential dilution of securities that could share in
the earnings of the Company such as common stock which may be issuable upon
exercise of outstanding common stock options or the conversion of debt into
common stock.

Pursuant to the requirements of the Securities and Exchange Commission,
the calculation of the shares used in computing basic and diluted EPS include
the 12% Convertible Bridge Notes, converted into shares of common stock, the
exercise of a stock grant and stock option program, and the exercise of stock
options granted to Mr. Fidler and Mr. Sugerman and the sale of shares of common
stock through the Company's initial public offering. public offering, as if they
were converted into common stock as of the original dates of issuance.

Year Year
June 30, June 30,
1998 1999
-------- -------

Total number common
shares outstanding 1,697,500 1,697,500

Effect of the assumed conversion
of convertible 12% bridge notes 140,067 143,791

Effect of the exercise of options
pursuant to Non Statutory Stock
Option Plan 300,000 300,000

Effect of the issuance of
shares of common stock
pursuant to Stock Grant
program 2200,000 200,000

Effect of the exercise of
stock options 1,175,000 1,175,000

Proforma sale of Shares
through registered offering 1,000,000
--------- ---------
Shares used in calculating
per share amounts - Diluted 3,512,567 4,516,291
========= =========

e. Revenue recognition

Revenue is recognized when products are shipped or services are rendered.

f. Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect 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.

g. Asset Impairment

The Company adopted the provisions of SFAS No. 121, Accounting for the
impairment of long lived assets and for long-lived assets to be disposed of.
(SFAS No. 121) effective January 1, 1996. SFAS No. 121 requires impairment
losses to be recorded on long-lived assets used in operations when indicators of
impairment are present and the estimated undiscounted cash flows to be generated
by those assets are less than the assets' carrying amount. SFAS No. 121 also
addresses the accounting for long-lived assets that are expected to be disposed
of. There was no effect of such adoption on the Company's financial position or
results of operations.

h. Income taxes:

The Company uses the liability method of accounting for income taxes. The
liability method measures deferred income taxes by applying enacted statutory
rates in effect at the balance sheet date to the differences between the tax
bases of assets and liabilities and their reported amounts in the financial
statements. The resulting asset or liability is adjusted to reflect changes in
the tax law as they occur.

i. Stock-based compensation:

The Financial Accounting Standards Board has issued SFAS No.123,
"Accounting for Stock-Based Compensation", which encourages, but does not
require, companies to record compensation cost for stock-based employee
compensation under a fair value based method. The Company has elected to
continue to account for its stock-based employee compensation using the
intrinsic value method prescribed by Accounting Principles Board Opinion No.25
("APB No.25"), "Accounting for Stock Issued to Employees" and disclose the pro
forma effects on net loss and loss per share basic and diluted had the fair
value of such compensation been expensed. Under the provisions of APB No.25,
compensation cost for stock options is measured as the excess, if any, of the
quoted market price of the Company's common stock at the date of the grant over
the amount an employee must pay to acquire the stock.

j . Recent accounting pronouncements:

The Financial Accounting Standards Board has recently issued statements of
Financial Accounting Standards No.130, "Reporting Comprehensive Income," and
No.131, "Disclosures about Segments of an Enterprise and Related Information,"
and No.132, "Employers' Disclosures about Pensions and Other Postretirement
Benefits." The above pronouncements will not have a significant effect on the
information presented in the financial statements.

Note 3. Related Party Transactions

a. Issuance of Common shares

On July 23, 1994, the Company sold 75 shares of common stock to Roger
Fidler and 75 shares of common stock to James Wright for a total consideration
of $100.

On July 24, 1994, the Company acquired certain patented technologies from
Broadwater Developments, Inc. ("Broadwater") for 375 shares of common stock and
Gerald Sugerman for 975 shares of common stock relating to coupling agents to be
used as paint additives. The Company has assigned a value of $1.00 per share of
common stock or $1,350 as the cost basis of this transaction.

b. Issuance of Preferred Stock

On June 20, 1996, the certificate was amended authorizing the issuance of
1,000,000 shares of preferred stock. The preferred stock may be issued in such
classes and with such preferences as the board of directors may, from time to
time, decide in their sole discretion.

The shares of preferred stock have preference as to liquidation, pay a 5%
cumulative dividend and may be redeemed by the Company at par value plus
accumulated dividends for a period of 5 years.

c. Employment Agreement

On June 30, 1995, the Company entered into a five year employment agreement
with Mr. Gerald Sugerman requiring the payment of a salary of $10,000 per month,
a royalty of 5% of net sales until a total of $350,000 in royalties is earned
and thereafter a 2% royalty on gross sales. For the period from July 22, 1994 to
June 30, 1999 and December 31, 1999, the Company has paid or accrued a salary
for Mr. Sugerman aggregating $420,000 and $480,000 respectively, of which
$390,000 and $450,000 respectively of accrued salary and $267,441 and $296,431
respectively in additional loans payable and reimbursable expenses which were
offset by the issuance of 4,806 shares of preferred stock representing $480,600
as of June 30, 1999. As of June 30, 1999 and December 31, 1999, the officer loan
balance due was $133,797 and $168,142 respectively.

d. Officer Compensation

No other officers or employees were paid in excess of $100,000.

e. Accounts receivable - related party

The Company entered into an informal marketing and supply agreement to both
sell component raw and finished materials and to buy finished products from
Enviro Ink, a Montreal, Canadian company. The arrangement was instituted to
permit the Company to strategically position itself in seeking a market share of
the printing ink business in Canada. At June 30, 1998 and September 30, 1998,
the net amount due the Company was $83,752 and $114,275 respectively. Sales to
Enviro Ink for the year ended June 30, 1998 and for the six months ended
December 31, 1998 were $88,023 and $16,856 respectively.

As of December 31, 1998, the Company reviewed its business relationship
with Enviro Ink and has determined that the amounts receivable at June 30, 1998
and December 31, 1998 may possibly be uncollectable in total. The Company has
set up a 100% reserve for the doubtful collection of the accounts receivable at
June 30, 1999 was $57,137.

f. Corporate Relationships.

Both the Company and Enviro Ink share Dr. Gerald Sugarman as a member of
senior management and as a principal shareholder. An Lou Chang is a 51%
shareholder in Enviro Ink and a shareholder in the Company.

Note 4 - Inventory

Inventory has been recorded at the lower of cost or market under the
first-in first-out method. At June 30, 1999 and December 31, 1999, inventory
components were as follow:

June 30, 1999 December 31, 1999

Raw material $15,376 $25,805
Finished goods 73,216 19,727
------ ------
Total $88,592 $45,532
====== ======

Note 5 - Capital Assets

Capital Assets for the Company consisted of the following at June 30,
1999:

Accumulated
Asset depreciation Balance

Office equipment $ 41,682 $23,737 $ 17,945
Production equipment 118,938 $34,974 83,964
Leasehold Improvements 8,346 2,505 5,841
------ ------- -------
Total $168,966 $61,216 $107,750
======== ======= =======

Capital Assets for the Company consisted of the following at December 31,
1999:

Accumulated
Asset depreciation Balance

Office equipment $ 47,276 $27,905 $ 19,371
Production equipment 125,538 $47,250 78,288
Leasehold Improvements 8,346 3,342 5,004
------ ------- -------
Total $181,160 $78,497 $102,663
======== ======= =======

Note 6 - License Agreement

On October 24, 1994, the Company entered into an agreement with
Broadwater and Pi-Tech, Inc., ("Pi-Tech"), a Delaware corporation controlled by
Broadwater and Gerald Sugerman for the licensing of certain patented
technologies relating to coupling agents used in paints. The Company acquired
the licensing agreement for 375 shares of common stock with Broadwater and 975
shares of common stock with Gerald Sugerman.

Note 7 - 12% Convertible Bridge Notes

Beginning May 1, 1996, the Company offered 12% Convertible Bridge Notes
("Notes") and then sold under Rule 504 to the Securities Act of 1933, as
amended, 20 Units consisting of a $25,000 Convertible Note bearing interest of
12% and is convertible in whole in or in part into a maximum of 8,300 shares of
common stock. The term of the note is two years with interest payable annually
in arrears. Each Debenture is in the face amount of $25,000 and may be sold in
1/2 Units.

As of June 30, 1999 and December 31, 1999, the Company has borrowed an
aggregate of $372,500 and accrued interest in the aggregate of $92,400 and
$114,750 respectively. As of June 30, 1999 and December 31, 1999, the total
balance due was current.

In the event of a public offering of the Company's stock, the Company may
compel the conversion of the Notes by paying the Note and accrued interest at
the closing of the public offering.

The indebtedness evidenced by the Notes is of equal priority regardless
of the date of any individual Note and is subordinate and junior to any and all
other indebtedness of the Company, whenever incurred, except indebtedness which
by its terms is expressly subordinated in right of payment to the Notes.

The Company has reserved sufficient authorized but unissued shares for
conversion of the Convertible Notes which shares, upon issuance and delivery,
will be duly and validly issued, fully paid and nonassessable.

Note 8 - Commitments and Contingencies

a. Lease Agreements

Through March 13, 1997, the Company occupied laboratory, plant and
warehousing space in Perkasie, Pennsylvania on a month to month basis for $500
per month.

On March 13, 1997, the Company entered into a lease agreement with an
unrelated parted for office and warehousing space at 163 South Street,
Hackensack, New Jersey for a period of 4 years with a monthly rent of $2,500 and
real estate taxes payable separately. The lease requires deposit of 2 months
rent aggregating $5,000 and two months free rent.. The minimum lease payments
each of the next four years is $30,000. The Company has an option to renew the
lease for an additional 4 years at a rental equal to the higher of $30,000 per
year or $30,000 per year plus 90% of the Consumer Price Index for April, 1997.
At June 30, 1998, the future minimum rental payments under the operating lease
are as follows:

June 30, 2000 30,000
June 30, 2001 30,000
-------
$ 60,000

For the years ending June 30, 1999 and the six months ended December 31,
1999, the Company paid an aggregate of $42,156 and $18,220 respectively.

b. Employment Agreement with Gerald Sugerman

On May 23, 1995, the Company entered into an employment with Gerald
Sugerman as Vice President for Scientific Affairs. The Company is obligated to
pay Mr. Sugerman 10,000 per month, life insurance equal to twice the his annual
salary, medical and disability insurance, automobile expenses equal to $0.30 per
mile, four weeks paid vacation, five sick days, six personal days, all of which
will be accumulated if not taken, reimbursement for travel and promotion
expenses, 5% of gross sales until Mr. Sugerman has received $350,000, 2% of net
sales thereafter and Mr. Sugerman is granted an option to purchase up to 850,000
shares of common stock at $1.00 per share for a period of 4 years beginning July
1, 1996.

As of June 30, 1999, the Company has reserved 850,000 shares of common
stock pending the exercise of this option

c. Employment agreement with Roger Fidler

In February, 1996, the Company entered into an employment agreement with
Roger Fidler as President and Director of Marketing. The Company is obligated to
pay Mr. Fidler a commission on sales equal to 15% of sales of coupling agents,
ink and paint vehicles and 10% of hard resin sales. Commissions on other
products sold through the efforts of Mr. Fidler will be negotiated in good faith
from time to time, but will be based upon the above scale as modified for
differences in the costs of production of the goods sold. The commissions will
be paid only on accounts opened by Mr. Fidler and will be paid for the term of
the contract and for one year after termination. Commissions will not be paid on
existing customers for the purchase of products presently purchased by them.

Upon the successful conclusion of a financing in excess of $500,000 or
sales of $2,000,000 per annum, whichever will occur first, Mr. Fidler will be
entitled to Company paid life insurance plan equal to twice his annual salary,
medical and disability insurance, automobile expenses equal to $0.30 per mile,
reimbursement for travel and promotion expenses Mr. Fidler is granted an option
to purchase up to 425,000 shares of common stock at $1.00 per share for a period
of 4 years beginning July 1, 1996. As of June 30, 1998, Mr. Fidler has exercised
100,000 options for an aggregate consideration of $100,000.

As of June 30, 1999, the Company has reserved an aggregate of 325,000 and
325,000 shares of common stock respectively pending the exercise of these
options.

As of June 30, 1999 and December 31, 1999, the Company is obligated to
repay and Officer loan balance of $54,504 and $86,089 respectively due on demand
without interest.

d. Letter of Intent for Corporate Financing

On April 15, 1996, the Company entered into an financing agreement with
Kenneth Jerome & Co., Inc. of Florham Park, New Jersey concerning an initial
public offering of 1,000,000 Units at $6.00 per Unit for an aggregate of
$6,000,000. Each Unit consisting of 1 share of common stock and 1 five-year
common stock "A" Purchase Warrant. Each Warrant entitling the owner to purchase
1 share of common stock at an exercise price of $7.00. The aggregate amount of
the public offering is subject to adjustment to include in the initial public
offering an over-allotment of 15%. The Company may redeem at $0.05 per class "A"
Warrant provided, however, that the closing bid price of the Company's common
stock in the over-the-counter market as reported by NASDAQ will have for 30
consecutive business days ending 15 days of the date of redemption average in
excess of $8.50 per share (subject to adjustments in the case of a reverse stock
split, stock dividend, etc.).

The Company, after applying the net proceeds of the initial public
offering must meet the criteria for listing on either NASDAQ or a regional
exchange.

The Company will prepare and file with the Securities and Exchange
Commission a Registration Statement on Form SB-2 for the maximum number of Units
offered:

a. 1,150,000 Units, each Unit consisting of one share of common stock and
one five-year common stock A Purchase Warrant, including the over-allotment.

b. 1,150,000 shares of common stock to be issued upon closing, 1,150,000
shares of common stock to be issued upon exercise of the A Warrants and 115,000
shares of common stock to be issued upon exercise of the Underwriter's Warrants.

c. The Company will pay all expenses of the proposed offering and the
issuance, sale and delivery of all of the Units, accounting and legal fees, cost
of "tombstone" advertisements not to exceed $5,000, 3% non-accountable expenses
or a maximum of $207,000 and all administrative costs.

d. The gross commission to the Underwriter will be 10% of the total
proceeds of the public offering.

e. If the offering is sold within the Underwriting Period, the Company
will sell to the Underwriter, Underwriter's Warrants to purchase Units which
Units will equal 10% of the Units offered to the public, at a price of $.001 per
Underwriter's Warrant. The exercise price of the Underwriter's Warrant will be
approximately 120% of the offering price of the Units. The Underwriter's
Warrants will be exercisable for a period of 4 years following the expiration of
1 year from the Effective Date. The Company agrees that it will, upon request by
the Underwriter, within the period commencing 12 months from the Effective Date,
and for a period of 4 years thereafter, on one occasion, at the Company's
expense, file a post-effective amendment to Register the Underwriter's Warrants.

f. The Underwriter's Warrants will contain various anti dilution
provisions which will protect the Underwriter as to the exercise price of the
Underwriter's Warrants and the percentage of common stock to which the
Underwriter is entitled.

g. Non statutory Stock Option Plan

On January 1, 1997, the Company adopted a Non statutory Stock Option Plan
("Plan"). 300,000 shares of common stock are reserved under the Plan. The Plan
is administered by the Board of Directors.

Stock options under the Plan may be granted to employees, officers,
directors, consultants of the Company or any other parties who have made a
significant contribution to the business and success of the Company. The
exercise price under the Plan may be more equal to or less than the current
market price of the Shares of Common Stock.

At June 30, 1999 and December 31, 1999, the number of options granted
pursuant to this program is -0-. As of June 30, 1999 and December 31, 1999, the
Company has reserved 300,000 shares of common stock pending the issuance and
exercise of options into shares of common stock.

h. Stock Grant Program

The Company has adopted a stock grant program with 200,000 shares of
common stock. The stock grant program provides for the issuance to officers,
directors and key employees stock grants as determined by the Board of
Directors. The recipient must continue employment with the Company for two years
after the grant is made or forfeit the stock.

As of June 30, 1999 and December 31, 1999, the number of shares of common
stock granted pursuant to this program is -0-.

As of June 30, 1999 and December 31, 1999, the Company has reserved 200,000
shares of common stock pending issuance.

I. Registered Offering

The Company is offering a minimum of 1,000,000 Units to a maximum of
1,150,000 Units at an offering price of $6.00 per Unit. Each Unit consists of 1
share of common stock and one redeemable common stock "A" Purchase Warrant,
exercisable into 1 share of common stock per warrant for a period of 5 years
from the effective date of the registration statement of which this Prospectus
is a part at an exercise price of $7.00 per share. The "A" Purchase Warrants are
redeemable at the Company's option commencing 90 days after the effective date
upon 30 days notice to the Warrant holders at $.05 per Warrant if the closing
bid price of the common stock in the over-counter-market as reported by NASDAQ
will have for a period of 30 consecutive trading days ending within 15 days of
the notice of redemption average in excess of $8.50 per share (subject to
adjustments in the case of a reverse stock split, stock dividend, etc.). Since
it is the Company's present intention to exercise such right, Warrant holders
should presume that the Company would call the Redeemable Warrants for
redemption if such criteria are met. The Redeemable Warrants are immediately
detachable and separately tradable from the Units upon issuance.

The shares are being offered by the Company and/or selected dealers on a
"firm commitment basis". The Underwriter will purchase 1,000,000 Units for later
resale, and has reserved the right to purchase up to an additional 150,000 Units
on the date of the Initial Public Offering in case of over booking of sales.

The Company has agreed to sell to the Underwriter, at a nominal price,
warrants to purchase 10% of the number of shares sold by the Underwriter or
dealers at an exercise price of $7.80 per share, which warrants will be
exercisable for four years commencing one year after issuance.

Note 9 - Income Taxes

The Company provides for the tax effects of transactions reported in the
financial statements. The provision if any, consists of taxes currently due plus
deferred taxes related primarily to differences between the basis of assets and
liabilities for financial and income tax reporting. The deferred tax assets and
liabilities, if any, represent the future tax return consequences of those
differences, which will either be taxable or deductible when the assets and
liabilities are recovered or settled. As of June 30, 1999, the Company had no
material current tax liability, deferred tax assets, or liabilities to impact on
the Company's financial position because the deferred tax asset related to the
Company's net operating loss carryforward and was fully offset by a valuation
allowance.

At June 30, 1999 and December 31, 1999, the Company has net operating loss
carry forwards for income tax purposes of $1,804,522 and $2,028,203
respectively. These carryforward losses are available to offset future taxable
income, if any, and expire in the year 2010. The Company's utilization of this
carryforward against future taxable income may become subject to an annual
limitation due to a cumulative change in ownership of the Company of more than
50 percent.

The components of the net deferred tax asset as of December 31, 1999 are as
follows:

Deferred tax asset:
Net operating loss carry forward $ 689,589
Valuation allowance $( 689,589)
----------
Net deferred tax asset $ -0-
==========

The Company recognized no income tax benefit for the loss generated for the
year ended June 30, 1998 and 1999 and for the six months ended December 31,
1999.

The Company's deferred tax asset has been fully reserved by a valuation
allowance since realization of its benefit is uncertain. The difference between
the statutory tax rate of 34% and the Company's effective tax rate of 0% is
substantially due to the increase in the valuation allowance of $592,180 for the
period from inception July 22, 1994, to December 31, 1999. The Company's ability
to utilize its net operating loss carryforwards may be subject to an annual
limitation in futureperiods pursuant to Section 382 of the Internal Revenue Code
of 1986, as amended.

Note 10 - Business and Credit Concentrations

At June 30, 1999 and December 31, 1999, the Company has concentrated its
credit risk by maintaining deposits in one banks. The maximum loss that could
have resulted from this risk totaled $-0- which represents the excess of the
deposit liabilities reported by the banks over the amounts that would have been
covered by the federal insurance

The amount reported in the financial statements for accounts receivable
and investments approximates fair market value. Because the difference between
cost and the lower of cost or market is immaterial, no adjustment has been
recognized and investments are recorded at cost.

Financial instruments that potentially subject the company to credit risk
consist principally of trade receivables. Collateral is generally not required.

Note 11 - Supplemental Cash Flow Information

The following is supplemental cash flow information for the Company for
the period from inception July 22, 1994 to December 31, 1999:

Acquisition of licensing agreement for 1,350 shares of common stock $( 1,350)

Issuance of shares of preferred stock in settlement of note
Payable and other accrued expenses to Gerald Sugerman $(330,000)

Capital stock 331,350
-------
$ -0-
=======

Note 12 - Development Stage Company

The Company is considered to be a development stage company with little
operating history. The Company is dependent upon the financial resources of the
Company's management for its continued existence. The Company will also be
dependent upon its ability to raise additional capital to complete is marketing
program, acquire additional equipment, management talent, inventory and working
capital to engage in profitable business activity. Since its organization, the
Company's activities have been limited to the entering into the marketing of
providing limited quantities of chemical coupling agents and other chemical
additives at competitive pricing, hiring personnel, acquiring equipment and
warehousing space, conducting research and development of its formulas and
preparation of documentation and the sale of a private placement offering.

SUBSCRIPTION AGREEMENT

The undersigned hereby subscribes for ______________ Units of the offering of
PPA Technologies, Inc. described herein. Subscriber acknowledges receipt of the
Prospectus in which the Subscription Agreement is included.

_______________________________ _______________________________
(Signature of Subscriber) (Signature of Subscriber)

_______________________________ _______________________________
Print Name Print Name

_______________________________ _______________________________
Date Date

_______________________________ _______________________________
Address Address

_______________________________ _______________________________
Social Security or Taxpayer Social Security or Taxpayer
Identification number Identification number

Form of Ownership Resided (check one):
[ ] Individual
[ ] Joint Tenants with rights of survivorship
[ ] Tenants in Common
[ ] Trust
[ ] Corporate
[ ] Partnership

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. Indemnification of Directors and Officers.

The By-Laws of the Company provide for indemnification of officers and
directors to the maximum extent allowed by the law of New Jersey, set forth in
greater detail below.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, and persons controlling the
registrant pursuant to the foregoing provisions or otherwise, the registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.

Article VII of the By-Laws of the Company provide for the maximum
indemnification allowed by the law of the State of New Jersey as follows:

"Every person who is or was a director, officer, employee or agent of
the Corporation, or of any corporation which he has served as such at
the request of the Corporation, shall be indemnified by the Corporation
to the fullest extent permitted by law against all expenses and
liabilities reasonably incurred by or imposed upon him, in connection
with any proceeding to which he may be made, or threatened to be made,
a party, or in which he may become involved by reason of his being or
having been a director, officer, employee or agent of the Corporation,
or such other corporation, at the time the expense or liabilities are
incurred."

ITEM 25. Other Expenses of Issuance and Distribution

The expenses payable by the Registrant in connection with the issuance and
distribution of the securities being registered (other than underwriting
discounts) are estimated as follows:

Maximum Minimum
Registration Fee-Securities and

Exchange Commission......................... $ 5,025.00 5,025.00
NASD Fee ................................... 2,175.00 2,175.00
Transfer Agent's Fee and Expenses .......... 2,800.00 2,800.00
Legal Fees and Expenses .................... 150,000.00 0.00
Blue Sky Fees and Expenses ................. 15,000.00 15,000.00
Printing Expenses (including securities) ... 25,000.00 25,000.00
Miscellaneous .............................. 25,000.00 25,000.00
Total.............................. $225,000.00 75,000.00
Estimated.

ITEM 26. Recent Sales of Unregistered Securities

The following sales made by the issuer within the past three years were
made under circumstances not involving any public offering, and which were
exempt from the registration requirements of the Securities Act of 1933, as
amended, by reason of Section 4(2) thereof and/or the Rules and Regulations
promulgated thereunder, specifically, Rule 504, Regulation D:

Purchaser Security Amount Date Consideration
- - ----------------------------------------------------------------

An Lou Chang Common 30,000 shares 07/01/97 $60,000
Eve Chang Debt $60,000 note 07/01/97 $60,000
Carl D. Fraley Debt $50,000 note 07/01/97 $50,000
Ray Beeler Debt $50,000 note 07/01/97 $50,000
Henry MacUga Debt $25,000 note 07/01/97 $25,000
Haskell Bernat Debt $25,000 note 07/01/97 $25,000
Edward Santangelo Debt $25,000 note 07/01/97 $25,000
Martin Santangelo Debt $25,000 note 07/01/97 $25,000
David Schotz Debt $25,000 note 07/01/97 $25,000
Lois S. MacUga Debt $12,500 note 07/01/97 $12,500
Aaron Lehman Debt $12,500 note 07/01/97 $12,500
David Lipson Debt $12,500 note 07/01/97 $12,500

ITEM 27. Exhibits and Financial Statement Schedules

1.(a) Form of Underwriting Agreement
(b) Form of Selected Dealers Agreement
3.(a) Registrant's Certificate of Incorporation
(b) Amendment to Certificate of Incorporation
(c) Registrant's By-Laws
4.(a) Specimen Security Certificate
(b) Form of Warrant
(c) Form of Underwriter's Warrant
(e) Form of Warrant Agreement
5.(a) Consent and Opinion of Jay Hait, Esq.
10. Material Contracts
(a) Employment Agreement between the Company
and Gerald Sugerman
(b) Employment Agreement between the Company
and Roger Fidler
(c) Lease
(d) Lease/Sale Agreement between the Company
and Blue Ridge Technologies, Inc.
24.(a) Consent of Thomas Monahan, Certified Public
Accountant

ITEM 28. Undertakings

The undersigned Registrant hereby undertakes that:
(A) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration Statement:

(i) to include any Prospectus required by section
10(a)(3) of the Securities Act of 1933;

(ii) to reflect in the Prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement; and,

(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement, including
(but not limited to) any addition or deletion of a managing underwriter.

(B) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
Registration Statement relating to the securities offered therein and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

(C) To remove from registration, by means of a post-effective amendment to
the Registration Statement, any of the securities offered hereby which are not
sold pursuant to the terms of this offering.

(D) Will provide to the underwriter at the closing specified in the
underwriting agreement certificates in such denominations and registered in such
names are required by the underwriter to permit prompt delivery to each
purchaser.

(E) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the small business issuer pursuant to the foregoing provisions, or otherwise,
the small business issuer has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
small business issuer of expenses incurred or paid by a director, officer or
controlling person of the small business issuer in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the small business
issuer will, unless in the opinion of its counsel has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question of whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and has duly caused this Amendment
No. 5 to its Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Hackensack and State of
New Jersey, on the 29th day of February, 2000.

PPA TECHNOLOGIES, INC.

BY: /S/ Roger Fidler
Roger Fidler, President
Chief executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.

/S/ Roger Fidler President, February 29, 2000
Roger Fidler Director

/S/ Gerry Sugerman Director, February 29, 2000
Gerry Sugerman Treasurer,
Secretary,
Chief Financial and
Accounting Officer

/S/ James Wright Director, February 29, 2000
James Wright

/S/ Albert Mersberg Director, February 29, 2000
Albert Mersberg