UNITED STATES
SECURITIES EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-12G/A
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of
The Securities Exchange Act of 1934
LONDON SOFTWARE INDUSTRIES INC.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 13-4047693
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
52-30 Pacific Concourse Drive
Suite 350
Los Angeles, California 90045
- ---------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number 310-643-4467
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Securities to be registered pursuant to Section 12(g) of the Act:
6,000,000 Shares of Voting Common Stock
Check here whether the issuer (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past
90 days.
Yes X No
As of April 30, 1999, the following shares of the Registrant's
common stock were issued and outstanding:
25,000,000 shares authorized, $0.001 par value
6,000,000 issued and outstanding
Item 1. DESCRIPTION OF THE BUSINESS
HISTORY AND ORGANIZATION
LONDON SOFTWARE INDUSTRIES INC., (the "Company"), a development
stage company, was organized in April 1997 under the laws of the
State of Delaware, having the stated purpose of engaging in any
lawful act or activity for which corporations may be organized
under the General Corporation Law of Delaware.
The Company was formed to develop software and computer related
educational material which was to be distributed through the
medium of CD-ROM markets for personal and business use. The
Company also seeks to conduct research and development of
educational software for the distribution on the new DVD high
density market.
The Company conducted key research pertaining to consumer demand
and retail sales. In January 1998, the Company, through
consultants, produced a draft report in the form of an
information Memorandum which indicated a strong potential market
for both reference and educational CD-Roms. The financial
projections included with the report were also encouraging. The
Company at this stage decided to approach potential investors for
the purpose of raising additional funds for research, product
sourcing and preparation for production and marketing.
In May 1998, a number of investors had been approached however
none were prepared to invest funds for research and production.
The Company thereafter decided to prepare a Private Placement
Memorandum to raise funds for the purpose of conducting such
research. The Company thereafter prepared and distributed a
Private Placement Memorandum in January 1999 which sought to
raise $20,000.00 for research by offering 2,000,000 shares at a
price of $.01 per share. The Private Placement Memorandum was
successful and fully subscribed.
The directors are now determined that the Company should become
active in seeking potential operating businesses and business
opportunities with the intent to acquire or merge with such
businesses. It is the directors' opinion that the company will
be more attractive to potential business partners and candidates
if the Company is a reporting one. The Company has began to
consider and investigate potential business opportunities however
has not yet located any probable candidates.
The Company is a development stage company and seeks to become
reporting with the Securities and Exchange Commission for the
purpose of making information regarding its efforts available to
the public.
Once funded the Company will seek to develop software capable of
converting from the hard copy into an html based context, so that
it may be immediately and efficiently placed onto a digital CD
Rom for mass production. It is also the intention of the Company
to develop software that will be able to convert hard copy into a
format so that the CD Roms may be viewed from the traditional
game consoles that are popular with children. The educational
titles will be aimed at the children's market and an attempt will
be made by the Company's titles to make learning and education
fun. The Company will not develop its own content for the CD
Roms. Rather it will seek to obtain content from independent
vendors through licensing deals. The selection of the content to
be marketed by the Company will be solely in the best discretion
and judgment of management. It should be noted that, at this
time, the Company has no licensing arrangements or deals with any
third party. Once the Company obtains the right to market the
content, it shall out source the manufacturing of the CD Roms.
The Company believes that by doing so it shall be able to keep
costs to a minimum. The majority of our costs will come in the
production of the CD Roms.
The Company is a developmental stage company and, at this time,
its costs have been mainly associated with the research and
initial development of the Company's concept. As such, the
Company has utilized minimal resources to date. The company
utilises equipment as supplied in the offices that we are based
from. The shareholder that supplies the office space, as part of
the office space also provides for computer and administrative
equipment that you would normally associate with a working
office.
Item 2. FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company is a development stage company. The Company has no
assets and no recent operating history.
The Company's goal is to develop educational and reference
software products which will be distributed on DVD high density
disks. The Company will design and market home shopping
catalogues, literary works of classic authors, reference books,
virtual reality museums, business related data bases, city guides
for tourists and residents and teaching aids. The Company's
emphasize "user friendliness" software which is both attractive
and entertaining. The targeted group of the company's software
will be able to be used by novice and intermediate computer users
and children.
The range of products will combine elements from the best
existing products with innovative ideas. Many of the products
will be self-financing joint ventures providing the programming
expertise. The company also plans to offer a comprehensive after
sales and technical support service. A web site and e-mail
facilities will give customers a high degree of technical
software as well as provide updates, fixes and information on new
products. The Company's products will seek to combine elements
from successful software packages with the Company's innovative
ideas as set forth above. These innovative ideas include those
set forth in the Company's proposed portfolio of products.
There is no certainty that the Company will be successful in
implementing its business plan or, if it does implement its plan,
be able to become profitable. Potential investors are alerted
that the investment in the Company is highly speculative and
involves a high degree of risk.
Management intends to hold expenses to a minimum and to obtain
services on a contingency basis when possible. Further, the
Company's directors will forego any compensation until such time
as the Company begins to generate sufficient investment in the
Company to cover such expenses. However, if the Company engages
outside advisors or consultants in search for business
opportunities, it may be necessary for the Company to attempt to
raise additional funds. There is no assurance that the Company
will be able to obtain additional funding when and if needed, or
that such funding, if available, can be obtained on terms
acceptable to the Company.
There is no certainty that the Company's business will be
successful or profitable. There is also no certainty that the
Company will be able to operate a successful business. Potential
investors are alerted that the investment in the Company is
highly speculative and involves a high degree of risk.
The material activities of the management since inception has
been to develop the Company's business strategy and to research
the overall CD-Rom market. This has been done by attending
seminars on technology and business, as they relate to technology
markets, and by discussing the overall market with entrepreneurs
already established in the field. Management has also been
identifying the various title segments and concepts which the
Company will seek to produce in the CD Rom format. This has been
important in terms of developing the overall product which the
Company will produce. Management has also been speaking with
potential licensee partners who have content to offer the Company
for inclusion in the Company's CD-Roms. Potential producers of
the CD-Roms have also been sought through networking and
introductions. The Company has expended $23,000 in start up
costs which consist of initial research into the marketplace, the
preparation of the business plan and the printing of the business
plan.
The selection of a business opportunity in which to participate
is complex and risky. Additionally, as the Company has only
limited resources, it may be difficult to find favorable
opportunities. There can be no assurance that the Company's
research and selection of CD and DVD products will succeed or be
accepted by the public. Additionally, the DVD market is highly
undeveloped and there is substantial risk attributed to the
investment and entry into such market.
Because the Company lacks funds, it may be necessary for the
officers and directors to either advance funds to the Company or
to accrue expenses until such time as the Company begins to
generate sufficient income to cover such expenses. Management
intends to hold expenses to a minimum and to obtain services on a
contingency basis when possible. Further, the Company's
directors will forego any compensation until such time as the
Company begins to generate sufficient income to cover such
expenses. However, if the Company engages outside advisors or
consultants in search for business opportunities, it may be
necessary for the Company to attempt to raise additional funds.
There is no assurance that the Company will be able to obtain
additional funding when and if needed, or that such funding, if
available, can be obtained on terms acceptable to the Company.
In the opinion of management, inflation has not and will not have
a material effect on the operations of the Company until such
time as the Company develops material operations. At that time,
management will evaluate the possible effects of inflation on the
Company as it relates to its business and operations.
The Company will not borrow funds for the purpose of funding
payments to the Company's promoters, management or their
affiliates or associates. Any funds borrowed by the Company will
be utilized to pay statutory, legal and accountant fees expended
by the Company.
The Company expects its products to be self-financing joint
ventures. Management will negotiate with third parties to
produce and distribute the CD-Roms in exchange for an agreed
share of the profits. There is however no guarantee that the
Company will be able to negotiate a favorable arrangement with
any third party and, at this time, the Company has not commenced
any negotiations with any third party regarding such an
arrangement. Additionally, the Company may seek to acquire or
merge with an existing entity which may provide the Company with
either the content for the production of the CD-Roms or with the
ability to actually produce them. To this end, the Company will
only undertake such a merger or acquisition on terms which it
deems favorable to the shareholders. At this time, the Company
has no prospective plans, tentative or otherwise, or is involved
in any negotiations to enter into a merger, acquisition or joint
venture or any other business combination.
The Company does not foresee that any terms of sale of the shares
presently held by officers and/or directors of the Company will
also be afforded to all other shareholders of the Company on
similar terms and conditions.
PROPOSED OPERATIONS
The Company plans to establish and develop a marketing concept
not fully exploited in the UK and Europe - the CD Rom as a
principal source of information at home and in the office.
The quality, variety and usefulness of the product will determine
the level of demand for individual products and is the key to the
success of the business. Typical examples of the innovative
range of CD-Roms which the company will create are discussed
below.
The Company is carrying out extensive research in the various CD
Rom marketplaces and in light of such research the company
intends to establish the following portfolio of products:
Home shopping CD catalogues: The cost of publishing and
distributing catalogues is a major cost in the mail order
industry. The CD Rom offers home shopping companies the
opportunity to bring all the information currently provided by a
catalogue into the home at a fraction of the cost.
Literary works: The complete works of major authors can be
stored conveniently in CD Rom form. Although not designed for
general reading purposes, the CD Roms provide an excellent source
of reference material and provide background information on the
author and commentary on each book. These CD-Roms are ideal for
students, academics and readers alike.
Reference books: Sources of reference such as dictionaries,
thesauruses, atlases, publications for enthusiasts (such as the
railways, motor vehicles, stamps etc). The CD Rom has proved
itself as an excellent media for providing interactive access to
this type of information.
Virtual reality museums: Aimed at the Art enthusiast, these CD's
allow the user to study in detail a range of pictures, artists
and other related information.
Data bases: The CD's 600 million byte (Mb) capacity makes it
ideal for storage of vast quantities of data. Business
information, statistics, stock market data and legislation are
typical examples of ideal applications.
City guides: Detailed information on a city, in which one lives
or is staying in, is not always easily accessible. By compiling
a database, which can be searched by criteria, provides the user
with an easy way of organizing meetings, days or evenings out, or
simply looking up where to go for what. Add-on features will
include booking facilities, reviews of clubs, bars and
restaurants and access to a database for a current "whats on"
guide.
Teaching aids: Experience has shown that interactive teaching
through a computer is an extremely effective method of teaching.
By incorporating tests, quizzes, speech and a tailored tutorial
into the product, learning can be fun and therefore more
productive. Languages, school curriculum or general interest
subjects can be covered.
The range of products will combine elements from the best
existing products with innovative ideas in the portfolio shown
above. No products will be created unless they can meet set
quality standards and no product distributed until it has been
fully tried and tested. The customer will know that whatever he
buys, he will be satisfied.
The company plans to make sure that each product will be
carefully budgeted to ensure profitability at conservative
volumes. The manufacture of CD Roms will be subcontracted at
predetermined rates, resulting in the cost base of each title
able to be determined in advance with a high degree of accuracy.
The company plans to offer a comprehensive after sales and
technical support service. A web site and e-mail facilities will
give customers a high degree of technical support as well as
provide updates, fixes and information on new products.
Many of London Software's applications will be joint ventures
with companies using traditional publishing methods where CD Roms
are a more effective means of providing information to the end
user. This market is limited by new ideas and the company's
ability to deliver the right product at the right price.
LIQUIDITY
The Company's viability as a going concern is dependent upon
raising additional capital, and ultimately, having net income.
The Company's limited operating history, including its losses and
no revenues, primarily reflect the operations of its early stage.
As a result, the Company had from time of inception to April 30,
1999 no revenue and a net loss from operations of $140,550.00.
As April 30, 1999, the Company had a net capital deficiency of
$12,500.00.
The Company requires additional capital principally to meet its
costs for the implementation of its business plan, for general
and administrative expenses and to fund costs associated with
research and development of its software. It is not anticipated
that the Company will be able to meet its financial obligations
through internal net revenue in the foreseeable future. The
Company does not have a working capital line of credit with
any financial institution. Therefore, future sources of
liquidity will be limited to the Company's ability to obtain
additional debt or equity funding. The Company anticipates that
its existing capital resources will enable it to maintain its
current implemented operations for at least 12 months, however,
full implementation of its business plan is dependent upon its
ability to raise substantial funding.
Currently, the Company has sufficient capital to cover the cost
of its operations for the next twelve (12) months which the
Company foresees will primarily consist of further research of
the Company's concept and also networking and discussions by the
Company's management with individuals and entities involved in
the CD-Rom software development field. The Company however
believes that it shall require additional capital in order to
implement its business plan once research of its concept is
completed. It is not anticipated that the Company will be able
to meet its financial obligations through internal net revenue in
the foreseeable future beyond twelve (12) months as the Company
has yet to generate sales of its product or to begin substantial
operations. Therefore, future sources of liquidity will be
limited to the Company's ability to obtain additional debt or
equity funding. Investors are alerted that the Company does not
have a working capital line of credit with any financial
institution and that there is no guarantee or assurance that the
Company will be able to raise such funds.
In the event the Company needs additional funding, it shall elect
to source funds from its shareholders owning more than 10% of the
Company's common stock and seek funding from such shareholders.
In such event, the Company will re-evaluate its plans and its
proposed operations to determine whether it would be feasible to
continue to implement its business plan. The Company would not
seek funding beyond its limitations and
would ensure that the Company would operate as efficiently as
possible to keep costs as streamlined as possible. The Company
will not seek funding beyond that which it foresees it will be
able to re-pay over a period of twelve (12) months. Should a
sudden jump in inflation occur the company's prices may then have
to rise in line with inflation.
YEAR 2000 DISCLOSURE
The Company is aware of the Year 2000 issue and states that it
currently does not maintain any material active operations which
it foresees will be impacted by the Year 2000 problem. Research
and development undertaken by the Company to this date has
consisted of attending seminars on technology and business, as
they relate to technology markets, and by discussing the overall
market with entrepreneurs already established in the field.
Management has also been identifying the various title segments
and concepts which the Company will seek to produce in the CD Rom
format. No material operations have been implemented by the
Company to date and it is not foreseen that material operations
will exist by January 1, 2000. The Company does not currently
own computer equipment and therefore does not foresee the Year
2000 issue to create a problem for it. In the event the Company
purchases computer equipment prior to January 1, 2000, it will
insure that any system or software it utilizes is Y2K compliant.
Management therefore does not anticipate that the company will be
affected by this issue, financially or otherwise. Its research
and development of software and programs will be cognizant of the
Year 2000 problem and address this issue. This disclosure
complies with the directives of the Securities and Exchange
Commission, specifically Staff Legal Bulletin No. 5 (CF/IM),
regarding Year 2000 issues.
SELECTED FINANCIAL DATA SCHEDULE
LONDON SOFTWARE INDUSTRIES INC.
(A Development Stage Company)
FINANCIAL DATA SCHEDULE
FOR THE YEAR ENDED APRIL 30, 1999
For the Year From Inception
Ended To
Apr. 30, 1999 Apr. 30, 1999
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Cash and Cash Items $ 0 $ 0
Marketable Securities 0 0
Notes and Accounts Receivable 0 0
Allowances for doubtful accounts 0 0
Inventory 0 0
Total Current Assets 0 0
Property, plant and equipment 0 0
Accumulated depreciation 0 0
Total assets 0 0
Total current liabilities 12,450 12,450
Bonds, mortgages and debt 50 50
Preferred stock - redemption 0 0
Common stock 6,000 6,000
Other stockholders' equity (18,500) (18,500)
Total Liabilities and
Stockholders' equity 0 0
Net Sales of Tangible Products 0 0
Total Revenues 0 0
Cost of Tangible Goods Sold 0 0
Total Costs and Expenses applicable
To sales and revenues 0 0
Other costs and expenses 140,550 203,600
Provision for doubtful accounts 0 0
Interest and amortization of
Debt discount 0 0
Income before taxes and
and other items (140,550) (203,600)
Income tax expenses 0 0
Income/loss continuing
operations (140,550) (203,600)
Discontinued operations 0 0
Extraordinary items 0 0
Cumulative Effect - changes in
Accounting principles 0 0
Net Income or loss (140,550) (203,600)
Item 3. DESCRIPTION OF PROPERTY
The company's administrative offices are located at 52-30 Pacific
Concourse Drive, Suite 350, Los Angeles, California 90045. The
Company also maintains offices at 31 Church Road, Hendon, London.
The company at this time has no other material assets or
property.
Item 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth the information, to the best
knowledge of the Company as of March 31, 1999, with respect to
each person known by the Company to own beneficially more than 5%
of the Company's outstanding common stock, each director of the
Company and all directors and officers of the Company as a group.
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class
- ---------------- -------------------- --------
Quality Worldwide Ltd. 600,000 10%
1 Great Cumberland Place
London, UK
(M. Griffiths)
Grademore Analysis Limited 600,000 10%
168 Church Road Hove
Sussex, UK
(H. Boylett)
Jubilee Systems Limited 600,000 10%
211 Eagle Place
Piccadilly, London UK
(K. Aluko)
Wing Capital Limited 670,000 11.2%
25 Turnbull Lane
Gibraltar
(J. Wing)
Channing Investments Limited 670,000 11.2%
S8 Int'l Business Ctre
Casenate Main Street
Gibraltar
(G. Cowan)
Bradwall Limited 650,000 10.8%
S8 Int'l Business Ctre
Casenate Main Street
Gibraltar
(Alan Bowen)
Melchrisea Holdings Limited 500,000 8.3%
25 Turnbull Lane
Gibraltar
(M. Driscoll)
Alan Bowen 165,000 2.8%
41 Bluebell Meadow
Sherwood, UK
The Company has been advised that each of the persons listed
above has sole voting, investment, and dispositive power over the
share indicated above. Percent of Class (third column above) is
based on 6,000,000 shares of common stock outstanding as of the
date of this filing.
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS
Position(s) Held and
Name Age Duration of Service Family Relation
- ---------------- --- ------------------- ---------------
Alan G R Bowen 54 President and Director None
Barbara Platts 71 Secretary None
All directors hold office until the next annual meeting of
stockholders and until their successors have been duly elected
and qualified. There are no agreements with respects to the
election of directors.
Set forth below is certain biographical information regarding the
Company's executive officers and directors:
Alan G.R. Bowen, the Company's president and director since 1997,
is a graduate in Mathematics from Birmingham University and
worked as a graduate trainee for Unilever before moving into
retailing with British Shoe Corporation, part of the Sears Group.
In 1971, he joined NSS Newsagents and progressed to become Retail
Director and then Group Managing Director. He left NSS
Newsagents after it was taken over by Gallahers Tobacco and
formed an independent Mayfair Cards, a greetings card company.
Alan G.R. Bowen is also a director of Mayfair Cards
(Waterlooville) Limited, a United Kingdom Corporation.
Barbara Platts has had a distinguished career in the marketing
and strategy of many companies, operating on a consultancy basis.
Barbara started her career in the 1960's and brings extensive
marketing experience to the Company. In the past she has
represented at senior level various companies in all stages of
development. She has had extensive experience in the software
industry and will use her vast associations to assist in moving
the company forward. She currently holds zero stock in the
Company.
To the best knowledge of management, during the past five years,
no present or former director or executive officer of the
Company:
(1) filed a petition under the federal bankruptcy laws or any
state insolvency law, nor had a receiver, fiscal agent or similar
officer appointed by a court for the business or present of such
a person, or any partnership in which he was a general partner at
or within two years before the time of such filing, or any
corporation or business association of which he was an executive
officer within two years before the time of such filing;
(2) was convicted in a criminal proceeding or named subject of a
pending criminal proceeding (excluding traffic violations and
other minor
offenses);
(3) was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining him
form or otherwise limiting, the following activities:
(i) acting as a futures commission merchant, introducing broker,
commodity trading advisor, commodity pool operator, floor broker,
leverage transaction merchant, associated person of any of the
foregoing, or as an investment advisor, underwriter, broker or
dealer in securities, or as an affiliated person, director of any
investment company, or engaging in or continuing any conduct or
practice in connection with such activity; (ii) engaging in any
type of business practice; or (iii) engaging in any activity in
connection with the purchase or sale of any security or commodity
or in connection with any violation of federal or state
securities laws or federal commodity laws;
(4) was the subject of any order, judgment, or decree, not
subsequently reversed, suspended, or vacated, of any federal or
state authority barring, suspending, or otherwise limiting for
more than 60 days the right of such person to engage in any
activity described above under this Item, or to be associated
with persons engaged in any such activity;
(5) was found by a court of competent jurisdiction in a civil
action or by the Securities and Exchange Commission to have
violated any federal or state securities law, and the judgment in
subsequently reversed, suspended, or vacate;
(6) was found by a court of competent jurisdiction in a civil
action or by the Commodity Futures Trading Commission to have
violated any federal commodities law, and the judgment in such
civil action or finding by the Commodity Futures Trading
Commission has not been subsequently reversed, suspended or
vacated.
The Company's Common Stock is registered pursuant to Section
12(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and in connection therewith, directors,
officers, and beneficial owners of more than 10% of the Company's
Common Stock are required to file on a timely basis certain
reports under Section 16 of the Exchange Act as to their
beneficial ownership of the Company's Common Stock.
Item 6. EXECUTIVE COMPENSATION
SUMMARY
The Company has not had a bonus, profit sharing, or deferred
compensation plan for the benefit of its employees, officers or
directors. The Company has no plans at the present to compensate
its directors.
COMPENSATION TABLE: None
CASH COMPENSATION
There was no cash compensation paid to any director or executive
officer of the Company during the two fiscal years ended April
30, 1999.
BONUSES AND DEFERRED COMPENSATION: None.
COMPENSATION PURSUANT TO PLANS: None.
PENSION TABLE: None.
OTHER COMPENSATION: None.
COMPENSATION OF DIRECTORS: Compensation is paid to the three
operational directors as set forth above.
TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENT:
There are no compensatory plans or arrangements of any kind,
including payments to be received from the Company, with respect
to any person which would in any way result in payments to any
such person because of his or her resignation, retirement, or
other termination of such person's employment with the Company or
its subsidiaries, or any change in control of the Company, or a
change in the person's responsibilities following a change in
control of the Company.
Item 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
WITH MANAGEMENT AND OTHERS.
To the best of Management's knowledge, during the fiscal year
ended April 30, 1999 there were no material transactions, nor are
there any currently proposed transactions, to which the Company
was or is to be a party, in which the amount involved exceeds
$60,000, and in which any director, executive officer, security
holder, or immediate family member thereto, has any
interest.
CERTAIN BUSINESS RELATIONSHIPS:
During the fiscal years ended April 30, 1999 there were no
material transactions between the Company and its management.
INDEBTEDNESS OF MANAGEMENT:
To the best of Management's knowledge, during the fiscal years
ended April 30, 1999, there were no material transactions, or
series of similar transactions, since the beginning of the
Company's last fiscal year, or any currently proposed
transactions, or series of similar transactions, to which the
Company was or is to be a party, in which the amount involved
exceeds $60,000, and in which any director or executive officer,
or any security holder who is known by the Company to own of
record or beneficially more than 5% of any class of the company's
common stock, or any member of the immediate family of any of the
foregoing persons, has an interest.
TRANSACTIONS WITH PROMOTERS:
To the best Knowledge of management, no such transactions exist.
Use of office space and equipment by the company is provided by
one of the shareholders to assist the Company in developing its
operations. The Company uses office space for its executive
offices at two locations, both of which it receives from one of
its shareholders at no cost. The fair market value of the 1,000
square foot office at International House, 31 Church road,
Hendon, London UK is $300 per month. Use of this office space
began August 10, 1998. The fair market value of the 600 square
foot office at 52- 30 Pacific Concourse Drive, Suite 350, Los
Angeles, California is also $300 per month.
Once the Company begins to generate sufficient income to cover
such expenses, it shall repay its officers for their work based
upon the fair market value of their total services contributed.
There is no formal agreement for such repayment and the officers
understand that there is no guarantee that they shall ever
receive such repayment or an amount equal to the fair market
value of the services.
Item 8. LEGAL PROCEEDINGS
No legal proceedings are pending at this time.
Item 9. MARKET PRICE OF AND DIVIDENDS FOR COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
The Company is not aware of any quotations for its common stock,
now or at any time within the past two years. On April 30, 1999,
there were approximately 148 holders of record of the issued and
outstanding shares of Issuer's common stock. The Company, to the
best of its knowledge, obtained 148 shareholders subsequent to
the issuance of an initial issuance of shares upon its
incorporation and a Regulation D 504 offering which was
undertaken in January 1999. Issuer has never paid a dividend on
its outstanding equity. The Company currently has no established
public trading market for its common stock.
Item 10. RECENT SALES OF UNREGISTERED SECURITIES
The Company conducted a private placement pursuant to Rule 504 of
Regulation D of the Securities Act of 1933 on January 4, 1999
whereby the Company offered 2,000,000 shares of common stock at a
price of $.01 per share. The transaction was exempt from
registration pursuant to the Regulation D exemption.
Item 11. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE
REGISTERED
The securities of the registrant to be registered are 6,000,000
shares of voting common stock, $0.001 par value.
Item 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Indemnification of Directors and Officers of the Company are
provided under Section XI of the Company's By-laws, a copy of
which is attached hereto as an Exhibit 3. Additionally, Delaware
General Corporation Law provides for the indemnification of
Directors and Officers performing duties at the request of the
Company.
Item 13. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
FINANCIAL INFORMATION
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Stockholders of London Software
Industries Inc.
We have audited the accompanying balance sheet of London Software
Industries Inc., (a development stage company) as of April 30,
1999 and the related statements of loss, cash flows and
shareholders' equity for the year then ended, and for the period
from December 31, 1996 (inception) to April 30, 1999. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standard require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidences supporting
the amounts and disclosures in the financial statements, An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of London Software Technologies, as of April 30, 1999, and the
results of its operations and its cash flows for the year then
ended and for the period from December 31, 1996 (inception) to
April 30, 1999 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed
in Note 4 to the financial statements, the Company has losses
from operations and a net capital deficiency, which raise
substantial doubt about its ability to continue as a going
concern. Management's plans regarding those matters also are
described in Notes 4. The financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
Graf Repetti & Co., LLP.
New York, New York, June 25, 1999
LONDON SOFTWARE INDUSTRIES, INC.
(A Development Stage Company)
BALANCE SHEET
FOR THE YEAR ENDING APRIL 30, 1999
ASSETS
Current Assets
Cash $ 0
Other Current Assets 0
----------
Total Current Assets 0
Other Assets 0
----------
Total Assets $ 0
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts Payable $ 0
Accrued Expenses 12,450
-----------
Total Current Liabilities $12,450
Other Liabilities - Loan Payable 50
-----------
Total Liabilities $12,500
Stockholders' Equity
Common Stock, $.001 par value,
Authorized 25,000.000 Shares;
Issued and Outstanding 6,000,000
Shares 6,000
Additional Paid in Capital 185,100
Deficit Accumulated During
the Development Stage (203,600)
----------
Total Stockholders' Equity (12,500)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT) $ 0
The accompanying notes are an integral part of these financial
statements
LONDON SOFTWARE INDUSTRIES, INC.
(A Development Stage Company)
CONDENSED STATEMENT OF LOSS
FOR THE YEAR ENDED APRIL 30, 1999 AND
FROM DECEMBER 31, 1996 (INCEPTION) TO APRIL 30, 1999
For the Year From
Ended Inception to
April 30, 1999 April 30, 1999
------------- -------------
TOTAL REVENUES: $ 0 $ 0
---------- ----------
OPERATING EXPENSES:
Accounting 2,400 2,400
Legal 15,000 15,000
Rent (Note 2) 4,100 4,100
Filing Fee 50 100
Contributed Services (Note 5) 100,000 159,000
Other Start Up Costs 19,000 23,000
---------- ----------
Total Operating Expenses 140,550 203,600
---------- ----------
Operating Loss $(140,550) $(203,600)
---------- ----------
OTHER INCOME (EXPENSES):
Other Income 0 0
---------- ----------
NET LOSS $(140,550) $(203,600)
NET LOSS PER SHARE $ (0.03) $(0.06)
---------- ----------
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 4,476,712 3,659,624
---------- ----------
The accompanying notes are an integral part of these financial
statements.
LONDON SOFTWARE INDUSTRIES INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED APRIL 30, 1999 AND
FROM DECEMBER 31, 1996 (INCEPTION) TO APRIL 30, 1999
For the Year From
Ended Inception to
April 30, 1999 April 30, 1999
----------------- -----------------
CASH FLOWS FROM
OPERATING ACTIVITIES
Net Loss $(140,550) $(203,600)
-------- --------
Adjustments to Reconcile Net
Loss to Net Cash Used in
Operating Activities:
Contributed Services and rent 104,100 163,100
Changes in Assets and
Liabilities Increase in
Accounts Payable and Accrued
Expenses 12,450 12,450
-------- --------
Total Adjustments 116,550 175,550
-------- --------
Net Cash Used in
Operating Activities ( 24,000) ( 28,050)
-------- --------
CASH FLOWS FROM
FINANCING ACTIVITIES:
Loan Payable 0 50
Additional Paid In Capital 4,000 8,000
Proceeds from Issuance of
Common Stock 20,000 20,000
-------- --------
Net Cash Provided by
Financing Activities 24,000 28,050
-------- --------
Net Change in Cash 0 0
Cash at Beginning of Period 0 0
Cash at End of Period $ 0 $ 0
-------- --------
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
Cash Paid During the Period
for Interest Expense $ 0 $ 0
-------- --------
Corporate Taxes $ 0 $ 0
-------- --------
The accompanying notes are an integral part of these financial
statements.
LONDON SOFTWARE INDUSTRIES, INC.
(A Development Stage Company)
STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT)
FROM INCEPTION TO APRIL 30, 1999
Total
COMMON STOCK ISSUED Additional Accumulated Shareholders'
SHARES PAR VALUE Paid inCap Deficit Equity
----------------------------------------------------------------
ISSUANCE OF
4,000,000 SHARES
APRIL 25, 1997 4,000,000 $ 4,000 $ 0 $(4,000) $ 0
BALANCE AS OF
APRIL 30, 1997 4,000,000 4,000 0 (4,000) 0
NET LOSS FOR THE
YEAR ENDED
APRIL 30, 1998 0 0 59,000 (59,050) (50)
----------------------------------------------------------------
BALANCE
APRIL 30, 1998 4,000,000 4,000 59,000 (63,050) ( 50)
CANCELLATION OF
3,999,998 SHARES
JANUARY 3, 1999 (3,999,998) (4,000) (4,000) 0 0
ISSUANCE OF
3,999,998 SHARES
JANUARY 3, 1999 3,999,998 4,000 0 0 4,000
ISSUANCE OF
2,000,000 SHARES
FEBRUARY 2, 1999 2,000,000 2,000 18,000 0 20,000
NET LOSS FOR
THE YEAR ENDED
APRIL 28, 1999 0 0 104,100 (140,550) (104,100)
----------------------------------------------------------------
BALANCE
APRIL 30, 1999 6,000,000 $6,000 $126,159 $(203,600) $(108,070)
The accompanying notes are an integral part of these financial
statements.
LONDON SOFTWARE INDUSTRIES INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1999
NOTE 1 - NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
A. Description of Company
LONDON SOFTWARE INDUSTRIES, INC., ("the Company") is a for profit
corporation incorporated under the laws of the State of Delaware
on December 31, 1996. London Software Industries Inc., is a
developmental stage company whose principal objective is to
create and market a portfolio of CD Roms to include home shopping
CD catalogues, literary works, reference books, virtual reality
museums, data bases, city guides and teaching aids.
B. Basis of Presentation
Financial statements are prepared on the accrual basis of
accounting. Accordingly, revenue is recognized when earned and
expenses when incurred.
C. Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company
considers all short-term investments with maturity of three
months or less to be cash equivalents.
D. Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that, affect certain reported
amounts and disclosures. Accordingly actual results could differ
from these estimates. Significant estimates in the financial
statements include the assumption that the Company will continue
as a going concern. See Note 5.
E. Research and Development Costs
Research and development costs charged to expense are $16,000 for
the year ended April 30, 1999 and also from inception to April
30, 1999.
F. Issuance of Common Stock
Consideration for issuance of the 4,000,000 shares of common
stock on April 25, 1997 consisted of intellectual property
including the start up of the Company. This consideration was
valued at the par value of the stock for lack of an objective
fair market value. Consideration for issuance of the 3,998,998
shares of common stock on January 3, 1999 consisted of payment by
the shareholder of research and development and consultant fees
in the amount of $4,000. Consideration for issuance of the
4,000,000 shares of common stock on February 2, 1999 consisted of
$20,000.
NOTE 2 - USE OF OFFICE SPACE
The Company uses office space for its executive offices at two
locations, both of which it receives from one of its shareholders
at no cost. The fair market value of the 1,000 square foot
office at International House, 31 Church road, Hendon, London UK
is $300 per month. Use of this office space began August 10,
1998. The fair market value of the 600 square foot office at 52-
30 Pacific Concourse Drive, Suite 350, Los Angeles, California is
also $300 per month. Use of this office space began March 29,
1999. Before that, the Company used 600 square feet of office
space at 1750 Montgomery Street, San Francisco, CA with a fair
market value of $300 per month from November 30, 1998 to March
29, 1999. Each amount is reflected as an expense with a
corresponding credit to additional paid-in-capital.
NOTE 3 - EARNINGS PER SHARE
For the Year For the Year
Ended Ended
April 30, 1999 April 30, 1998
---------------------------------------
Net Loss per share $(0.03) $
NOTE 4 - LIQUIDITY
The Company's viability as a going concern is dependent upon
raising additional, capital, and ultimately, having net income.
The Company's limited operating history, including its losses and
no revenues, primarily reflect the operations of its early stage.
As a result, the Company had from time of inception to April 30,
1999 no revenue and a net loss from operations of $203,600. As
of April 30, 1999 the Company had a net capital deficiency of
$12,500.
The Company requires additional capital principally to meet its
costs for the implementation of its business plan, for general
and administrative expenses and to fund costs associated with the
start up of its travel services operations. It is not
anticipated that the Company will be able to meet its financial
obligations through internal net revenue in the foreseeable
future. London Software Industries Inc., does not have a working
capital line of credit with any financial institution.
Therefore, future sources of liquidity will be limited to the
Company's ability to obtain additional debt or equity funding.
See Note 6.
NOTE 5 - CONTRIBUTED SERVICES
On September 26, 1997, two of the Company's officers began
rendering services on behalf of the Company at no cost. The fair
market value is $4,167 per officer per month. Each month is
reflected as an expense with a corresponding credit to additional
paid in capital.
NOTE 6 - LOAN PAYABLE - TECH GROUP AND RELATED PARTY TRANSACTION
As of April 30, 1999, Tech Capital Group has paid $50 of expenses
on behalf London Software Industries Inc. The president of LSI
is a 10% shareholder in Tech Capital Group. Tech Capital Group
will lend up to $65,000 to LSI upon request. The loan is not
evidenced by a note. The informal agreement calls for no payment
of interest. LSI intends to repay the loan out of any fund
raising that it may carry out or when the company achieves
sustainable revenue.
LONDON SOFTWARE INDUSTRIES, INC.
(A Development Stage Company)
BALANCE SHEET (unaudited)
FOR THE YEAR ENDING APRIL 30, 1998
ASSETS
Current Assets
Cash $ 0
Other Current Assets 0
----------
Total Current Assets 0
Other Assets 0
----------
Total Assets $ 0
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts Payable $ 0
Accrued Expenses 50
-----------
Total Current Liabilities $ 50
-----------
Total Liabilities $ 50
Stockholders' Equity
Common Stock, $.001 par value,
Authorized 25,000.000 Shares;
Issued and Outstanding 4,000,000
Shares 4,000
Additional Paid in Capital 185,100
Deficit Accumulated During
the Development Stage (203,600)
----------
Total Stockholders' Equity ( 50)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT) $ 0
The accompanying notes are an integral part of these financial
statements
LONDON SOFTWARE INDUSTRIES, INC.
(A Development Stage Company)
CONDENSED STATEMENT OF LOSS
FOR THE YEAR ENDED APRIL 30, 1998 AND
FROM DECEMBER 31, 1996 (INCEPTION) TO APRIL 30, 1998
For the Year From
Ended Inception to
April 30, 1998 April 30, 1998
------------- -------------
TOTAL REVENUES: $ 0 $ 0
---------- ----------
OPERATING EXPENSES:
Accounting 0 0
Legal 0 0
Filing Fee 00 50
Contributed Services (Note 5) 59,000 59,000
---------- ----------
Total Operating Expenses 59,000 59,050
---------- ----------
Operating Loss $( 59,000) $( 59,050)
---------- ----------
OTHER INCOME (EXPENSES):
Other Income 0 0
---------- ----------
NET LOSS $( 59,000) $( 59,050)
NET LOSS PER SHARE $ (0.02) $(0.02)
LONDON SOFTWARE INDUSTRIES INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED APRIL 30, 1998 AND
FROM DECEMBER 31, 1996 (INCEPTION) TO APRIL 30, 1998
For the Year From
Ended Inception to
April 30, 1998 April 30, 1998
----------------- -----------------
CASH FLOWS FROM
OPERATING ACTIVITIES
Net Loss $( 59,000) $( 63,050)
-------- --------
Adjustments to Reconcile Net
Loss to Net Cash Used in
Operating Activities:
Changes in Assets and
Liabilities Increase in
Accounts Payable and Accrued
Expenses 0 50
-------- --------
Total Adjustments 0 50
-------- --------
Net Cash Used in
Operating Activities ( 59,000) ( 63,000)
-------- --------
CASH FLOWS FROM
FINANCING ACTIVITIES:
Loan Payable 0 0
Additional Paid In Capital 59,000 63,050
Proceeds from Issuance of
Common Stock 0 0
-------- --------
Net Cash Provided by
Financing Activities 59,000 63,050
-------- --------
Net Change in Cash 0 0
Cash at Beginning of Period 0 0
Cash at End of Period $ 0 $ 0
-------- --------
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
Cash Paid During the Period
for Interest Expense $ 0 $ 0
-------- --------
Corporate Taxes $ 0 $ 0
-------- --------
The accompanying notes are an integral part of these financial
statements.
Item 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
No changes in and disagreements with accountants on accounting
and financial disclosure.
Item 15. FINANCIAL STATEMENTS, EXHIBITS AND
REPORTS ON FORM 8-K
(A) FINANCIAL STATEMENTS
The Following financial statements are filed as part of this
registration statement:
Balance Sheet
Statement of Loss
Statement of Cash Flows
Statement of Shareholders' Equity (Deficit)
Selected Financial Data
(B) EXHIBITS AND INDEX OF EXHIBITS
The following exhibits are included in Item 13(c). Other
exhibits have been omitted since the required information is not
applicable to the registrant.
EXHIBIT
3 Certificate of incorporation and by-laws
11 Statement regarding computation of per share
earnings
27 Financial Data Schedule
(C) REPORTS ON FORM 8-K
No Report on Form 8-K was filed during the fourth quarter of the
period for which this Annual Report is filed.
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
LONDON SOFTWARE INDUSTRIES INC.
- ----------------------
(Registrant)
Date: August 19, 1999
By: /s/ Alan Bowen
----------------------
President