UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) JUNE 11,
2001
PTS, INC.
(Exact name of registrant as specified in its charter)
Nevada 000-25485 88-0380544
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(State of (Commission (I.R.S. Employer
Organization) File Number) Identification No.)
3960 Howard Hughes Pkwy., 5th Floor, Las Vegas, NV 89109
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(Address of principal executive offices) (Zip Code)
(702) 878-3397
Registrant's telephone number, including area code
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
Pursuant to a AcquisitionAgreement (the "Agreement") entered
into on June 11, 2001, Elast Technologies, Inc., a Nevada
corporation ("Elast" or the "Company"), acquired one hundred
percent (100%) of all the outstanding shares of common stock
("Common Stock") of PTS, Inc., a Nevada corporation ("PTS")
for a total of 9,000,000 shares. Under the terms of the
Agreement, PTS will also the sum of US$1 million to be paid
in $80,000.00 monthly installments commencing August 1, 2001
until July 1, 2002, with the remaining $40,000.00 to be paid
August 1, 2002.
The Acquisition was approved by the unanimous consent of the
Board of Directors of Elast and the shareholders of PTS on
June 11, 2001. Elast shall change its name to PTS, Inc.
The following table sets forth information regarding the
beneficial ownership of the shares of the Common Stock (the
only class of shares previously issued by the Company) at
June 25, 2001 by (i) each person known by the Company to be
the beneficial owner of more than five percent (5%) of the
Company's outstanding shares of Common Stock, and (ii) by
all directors and executive officers of the Company as a
group, prior to and upon completion of this Offering. Each
person named in the table, has sole voting and investment
power with respect to all shares shown as beneficially owned
by such person and can be contacted at the address of the
Company.
Title of Name/Address Shares Percentage
Class of Owner Beneficially Ownership
Owned
Common Peter Chin (1) 4,500,000 27.88%
3220 Westleigh Ave.
Las Vegas, NV 89102
Common Sandy Chin (1) 4,500,000 27.88%
3220 Westleigh Ave.
Las Vegas, NV 89102
Common Total owners of 5% or 9,000,000 55.75%
more
Beneficial Holdings of Officer and Directors:
Title of Name/Address Shares Percentage
Class of Owner Beneficially Ownership
Owned
Common Thomas Krucker (2) 8,734 *
2505 Rancho Bel Air
Las Vegas, NV 89107
Common Phillip Flaherty 0 *
604 Heartline Drive
Las Vegas, NV 89145
Common Brian Loke 0 *
6 Ridgewood Ct.
Belmont, CA 94002
Common Total ownership of 8,734 *
officers and directors
(3 individuals)
- ----------------------------------------------
* Denotes less than 1%
(1) Peter and Sandy Chin are husband and wife. Therefore,
together they hold 9,000,000 shares of common stock, which
represents 54.40% of the outstanding shares.
(2) Shares of the Company's common stock are held by (i)
Mr. Krucker; and (ii) a trust in the name of Mr. Krucker's
spouse, Katherine.
A copy of the Agreement has been filed as an exhibit to this
Form 8-K and is incorporated in its entirety.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Pursuant to the Acquisition Agreement, entered into on June
11, 2001, Elast Technologies, Inc. acquired one hundred
percent (100%) of the issued and outstanding shares of
common stock (Common Stock) of PTS, Inc., a Nevada
corporation from all of the shareholders of the issued and
outstanding Common Stock of PTS, in exchange for a total of
9,000,000 shares of common stock. PTS will aslo pay the sum
of US$1 million to be paid in $80,000.00 monthly
installments commencing August 1, 2001 until July 1, 2002,
with the remaining $40,000.00 to be paid August 1, 2002. No
material relationship exists between the selling
shareholders of PTS or any of its affiliates, any director
or officer, or any associate of any such director or officer
of PTS and the Company. The consideration exchanged pursuant
to the Agreement was negotiated between PTS and the Company
in an arm's-length transaction.
ITEM 5. OTHER
On June 5, 2001, Dr. Eduardo Daniel Jimenez Gonzalez
resigned as a director of the Company effective immediately.
On June 8, 2001, Dr. Robert D. Milne resigned as the
Secretary and a director of the Company, effective
immediately. Dr. Milne also accepted the position as
Director of the Chiropractic Division and Director of the
Allergy Division of PTS, Inc., effective immediately.
On June 26, 2001, the board of directors appointed Phillip
Flaherty and Brian Loke as members of the Board of
Directors, effective immediately. Mr. Thomas Krucker
resigned as the President and Treasurer, effective on June
26, 2001, but continues to remain as a member of the board
of directors and as the Secretary of the Company as well as
the CEO. Mr. Flaherty was appointed as President, and Mr.
Loke was appointed as the Treasurer to replace Mr. Krucker's
resignation as the President and Treasurer.
On June 26, 2001, the Company increased the authorized
shares of its common stock from 25,000,000 shares, par value
$0.001 per share to 250,000,000 shares of common stock, par
value $0.001 per share.
On June 26, 2001, the Company also changed its name to PTS,
Inc.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
a) The Audited Financial Statements for PTS, Inc. for the
period ended June 30, 2001 will be filed on or before August
25, 2001.
b) The pro-forma financial statements, which serve to
state the results of 2000 as if the two companies had
combined operations during 2000 will be filed on of before
August 25, 2001.
Audited financials for PTS, Inc.
INDEPENDENT AUDITORS' REPORT
TO THE BOARD OF DIRECTORS OF PTS, INC.:
We have audited the accompanying balance sheet of PTS, Inc. (A
Development Stage Company) as of June 30, 2001 and December 31, 2000 and
1999, and the related statements of operations, stockholder's equity and
cash flows for the six months ended June 30, 2001, the year ended
December 31, 2000, the initial period September 15, 1999 (inception) to
December 31, 1999, and from September 15, 1999 (inception) to June 30,
2001. 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 auditing standards generally
accepted in the United States of America. Those standards 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, evidence 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 PTS, Inc. as
of June 30, 2001 and December 31, 2000 and 1999, and the results of its
operations and its cash flows for the six months ended June 30, 2001, the
year ended December 31, 2000, the initial period September 15, 1999
(inception) to December 31, 1999, and from September 15, 1999 (inception)
to June 30, 2001 in conformity with accounting principles generally
accepted in the United States of America.
MERDINGER, FRUCHTER, ROSEN & CORSO, P.C.
Certified Public Accountants
New York, New York
August 27, 2001
PTS, INC.
(A Development Stage Company)
BALANCE SHEETS
<Table>
<s> <c> <c> <c>
June 30, December 31,
2001 2000 1999
-------- --------- ---------
ASSETS $ - $ - $ -
============== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities $ - $ - $ -
============== =========== ===========
STOCKHOLDERS' EQUITY
Common Stock, $0.01 par value;
1,000,000 shares authorized,
300,000 and -0- shares issued and outstanding 3,000 - -
Additional paid-in capital 1,897,000 - -
Subscription receivable (950,000) - -
Deficit accumulated during
the development stage (1,000,000) - -
------------ ----------- -----------
Total stockholders' equity - - -
------------ ----------- -----------
Total liabilities and stockholder's equity $ - $ - $ -
============ =========== ===========
</Table>
The accompanying notes are an integral part of these financial statements.
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PTS, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
<s> <c> <c> <c> <c>
September 15, September 15,
January 1, 2001 January 1, 2000 1999 1999
to to (inception) (inception)
to to
June 30, December 31, December 31, June 30,
2001 2000 1999 2001
------------ ----------- -------------- ----------
Revenue $ - $ - $ - $ -
General and administrative expenses 950,000 - - 950,000
------------- ----------- ----------- -------------
Loss from operations before provision
for income taxes (950,000) - - (950,000)
Provision for income taxes - - - -
-------------- ----------- ----------- -------------
Net loss $ (950,000) $ - $ - $ (950,000)
============== =========== =========== =============
Net loss per share - basic and diluted $ 5.43 $ - $ - $ (6.05)
============== =========== =========== =============
Weighted average number of
common shares outstanding 175,000 150,000 150,000 157,000
============= =========== =========== =============
</Table>
The accompanying notes are an integral part of these financial statements.
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PTS, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDER'S EQUITY
SEPTEMBER 15, 1999 (INCEPTION) TO JUNE 30, 2001
<Table>
<s> <c> <c> <c> <c> <c>
Deficit
Accumulated
Additional During the
Common Stock Paid-in Subscription Development
Shares Amount Capital Receivable Stage Total
-------- -------- -------- -------- ------- ---------
Balance, September 15, 1999 - $ - $ - $ - $ - $ -
Issuance of shares for note
receivable - June 2, 2001 150,000 1,500 948,500 (950,000) - -
Issuance of shares for services
- June 2, 2001 150,000 1,500 948,500 - - 950,000
Net loss - - - - (950,000) (950,000)
---------- ----------- ----------- ------------ ------------ -------------
Balance, June 30, 2001 300,000 $ 3,000 $ 1,897,000 $ (950,000) $ (950,000) $ -
========== =========== =========== ============ ============ =============
</Table>
The accompanying notes are an integral part of these financial statements.
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PTS, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
<Table>
<s> <c> <c> <c>
September 15, September 15,
January 1, January 1, 1999 1999
2001 to 2000 to (inception) (inception)
to to
June 30, December 31, December 31, June 30,
2001 2000 1999 2001
--------- --------- -------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (950,000) $ - $ - $ (950,000)
Stock issued for services 950,000 - - 950,000
------------ ---------- ---------- -------------
NET CASH USED IN OPERATING
ACTIVITIES - - - -
CASH AND CASH EQUIVALENTS
- beginning of period - - - -
------------- ---------- ---------- -------------
-
CASH AND CASH EQUIVALENTS
- end of period $ - $ - $ - $ -
============ ========== ========== =============
</Table>
SUPPLEMENTAL INFORMATION:
During the initial period September 15, 1999 to June 30, 2001,
the Company paid no cash for interest or income taxes.
The accompanying notes are an integral part of these financial statements.
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PTS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999
NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Nature of Operations
PTS, Inc. (the "Company") is currently a development-
stage company under the provisions of the Financial
Accounting Standards Board ("FASB") Statement of
Financial Accounting Standards ("SFAS") NO. 7. The
Company was incorporated under the laws of the state
of Nevada on September 15, 1999. The Company was
inactive until the year 2001.
Use of Estimates
The preparation of financial statements in
conformity with generally accepted accounting
principles requires management to make estimates and
assumptions that affect 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 revenue and
expenses during the reporting period. Actual
results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments
purchased with original maturities of three months or
less to be cash equivalents.
Income Taxes
Income taxes are provided for based on the liability
method of accounting pursuant to SFAS No. 109,
"Accounting for Income Taxes". Deferred income
taxes, if any, are recorded to reflect the tax
consequences on future years of differences between
the tax bases of assets and liabilities and their
financial reporting amounts at each year-end.
Earnings Per Share
The Company calculates earnings per share in
accordance with SFAS No. 128, "Earnings Per Share",
which requires presentation of basic earnings per
share ("BEPS") and diluted earnings per share
("DEPS"). The computation of BEPS is computed by
dividing income available to common stockholders by
the weighted average number of outstanding common
shares during the period. DEPS gives effect to all
dilutive potential common shares outstanding during
the period. The computation of DEPS does not assume
conversion, exercise or contingent exercise of
securities that would have an antidilutive effect on
earnings. As of June 30, 2001, the Company has no
securities that would effect loss per share if they
were to be dilutive.
Comprehensive Income
SFAS No. 130, "Reporting Comprehensive Income",
establishes standards for the reporting and display
of comprehensive income and its components in the
financial statements. The Company had no items of
other comprehensive income and therefore has not
presented a statement of comprehensive income.
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PTS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999
NOTE 2 -INCOME TAXES
The components of the provision for income taxes for
the period from January 1, 2001 to June 30, 2001 are
as follows:
Current Tax Expense
U.S. Federal $ -
State and Local -
----------
Total Current -
----------
Deferred Tax Expense
U.S. Federal -
State and Local -
----------
Total Deferred -
----------
Total Tax Provision (Benefit) from
Continuing Operations $ -
==========
The reconciliation of the effective income tax rate
to the Federal statutory rate is as follows:
Federal Income Tax Rate 34.0%
Effect of Valuation Allowance ( 34.0)%
--------
Effective Income Tax Rate 0.0%
========
At June 30, 2001, the Company had net carryforward
losses of $950,000. Because of the current
uncertainty of realizing the benefits of the tax
carryforward, a valuation allowance equal to the tax
benefits for deferred taxes has been established.
The full realization of the tax benefit associated
with the carryforward depends predominantly upon the
Company's ability to generate taxable income during
the carryforward period.
Deferred tax assets and liabilities reflect the net
tax effect of temporary differences between the
carrying amount of assets and liabilities for
financial reporting purposes and amounts used for
income tax purposes. Significant components of the
Company's deferred tax assets and liabilities as of
June 30, 2001 are as follows:
Deferred Tax Assets
Loss Carryforwards $ 323,000
Less: Valuation Allowance ( 323,000)
------------
Net Deferred Tax Assets $ -
============
Net operating loss carryforwards expire in 2021.
- 7 -
PTS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2001, DECEMBER 31, 2000, AND DECEMBER 31, 1999
NOTE 3 - COMMON STOCK
On June 2, 2001, the Company issued 150,000 shares of
common stock in exchange for a note receivable in the
amount of $1,000,000. The note bears no interest and
is payable in monthly installments of $80,000
commencing July 26, 2000, with a final payment of
$40,000 to be paid July 26, 2002. The note has been
recorded at a present value of $950,000, using a
discount rate of 8%.
Also on June 2, 2001, the Company issued 150,000
shares of common stock for services valued at
$950,000, based on the fair value of shares sold for
the note receivable described above.
NOTE 4 - ACQUISITION
On June 11, 2001, all of the Company's issued and
outstanding common stock was acquired by Elast
Technologies, Inc., a publicly-held corporation.
- 8 -
Pro Formas
On June 11, 2001 Elast Technologies, Inc. acquired all of the
issued and outstanding common stock of PTS, Inc. ("PTS") in
exchange for 9 million shares of its common stock. Elast then
changed its name to PTS, Inc. PTS was inactive from its
inception, September 15, 1999, through June 2, 2001. On that
date, PTS issued 150,000 shares of common stock in exchange for a
note receivable with a face amount of $1 million and a present
value of $950,000. It also issued an additional 150,000 shares of
common stock for services, which have been valued at $950,000.
This is the only activity of PTS through June 30, 2001. At June
30, 2001, PTS' only asset is the note receivable, which has been
shown as a reduction of stockholders' equity.
A pro forma Balance Sheet is not being presented since this
acquisition is reflected in the registrant's Form 10QSB for the
period ended June 30, 2001. A pro forma income statement for the
year ended December 31, 2000 has not been presented, due to the
inactivity of PTS during that period. There would be no
difference from the results previously reported by the
registrant. The pro forma results for the six month period ended
June 30, 2001 are as follows:
<Table>
<s> <c> <c> <c> <c> <c>
Elast PTS Combined Adjustments Pro Forma
Sales - - - - -
General and
Administrative 2,474,805 950,000 3,429,805 3,429,805
----------- ---------- ----------- -------- -----------
Loss from (2,479,805) (950,000) (3,429,805) (3,429,805)
operations
Loss per share (7.68) (5.43) $ (4.66)
Weighted Average
shares 323,061 175,000 498,061 237,500 735,561
outstanding
</Table>
Loss per share and share outstanding reflect a 1 for 20 reverse
split effected by the Company on June 26, 2001.
EXHIBITS
2.1 Acquisition Agreement *
3 Articles of Exchange *
3.1 Certificate of Amendment *
* Previously filed
SIGNATURES
Pursuant to the requirements 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.
PTS, Inc.
By: /s/ Phillip Flaherty
Phillip Flaherty, President
Date: August 30, 2001