SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT
UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December
31, 2000
Or
[ ] TRANSITION REPORT
PURSUANT TO SECTION 13 OR
15 (d)OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from
to
Commission file number 0-31245
KAW ACQUISITION CORPORATION
(Exact name of small business issuer
in its charter)
Nevada 91-2048013
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
963 Valley View Drive, Meadowbrook PA 19046-1317
(Address of principal executive offices (zip code))
Issuer's Telephone Number: 918-336-1773
Securities registered under Section 12(g) of the Exchange
Act: Common Stock $0.001 par value per share.
Check whether the issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during
the last 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
Check if there is no disclosure of delinquent files in
response to Item 405 of Regulation S-B is not contained in
this form, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part
III of this Form 10-KSB or any amendment to this Form
10-KSB. [ ]
State issuer's revenues for its most recent fiscal year.
$0
State the aggregate market value of the voting and
non-voting common equity held by non-affiliates computed
by reference to the price at which the common equity was
sold, or the average bid and asked price of such common
equity, as of a specified date within the past 60 days.
$0
State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest
practicable date.
Class Outstanding at
Common Stock, par value December 31, 2000
$0.001 500,000
PART I
ITEM 1. DESCRIPTION OF BUSINESS
Kaw Acquisition Corporation ("the Company") was
incorporated on May 3, 2000, under the laws of the State
of Nevada to engage in any lawful corporate undertaking,
including, but not limited to, selected mergers and
acquisitions. The Company has been in the developmental
stage since inception and has no operations to date other
than issuing shares to its original shareholder.
The Company's purpose is to seek, investigate and,
if such investigation warrants, acquire an interest in a
business entity which desires to seek the perceived
advantages of a corporation which has a class of
securities registered under the Exchange Act. The Company
will not restrict its search to any specific business,
industry, or geographical location and it may participate
in a business venture of virtually any kind or nature.
Management anticipates that it will be able to participate
in only one potential business venture because the Company
has nominal assets and limited financial resources.
The Company registered its common stock on a Form
10-SB Registration Statement filed pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act") and
Rule 12(g) thereof. The Company files with the Securities
and Exchange Commission periodic and current reports under
Rule 13(a) of the Exchange Act, including Quarterly
Reports on Form 10-QSB and Annual Reports Form 10-KSB.
SUBSEQUENT EVENTS
CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT.
On January 17, 2003, Kaw Acquisition Corporation (the
"Registrant") notified the accounting firm of Magee,
Rausch & Shelton, LLP, of Tulsa, Oklahoma ("MRS") that MRS
had been replaced as the Registrant's principal
accountant. MRS reported on and audited the financial
statements prepared by the Registrant for the period since
inception (May 3, 2000) and ending July 15, 2000.
On October 25, 2002, the Registrant engaged the accounting
firm of James J. Taylor ("JJT") of New Braunfels, Texas,
as its principal accountant to audit the financial
statements prepared by the Registrant for the current
fiscal year and for its past filings. The decision to
change accountants was recommended by the Company's Board
of Directors and was based on the recommendation of
Special Counsel to the Registrant to change as JJT would
be more accessible in the State of Texas to potential
merger candidates.
The financial statements reviewed as of July 15, 2000 and
reported by MRS did not contain an adverse opinion or a
disclaimer of opinion, nor were qualified or modified as
to uncertainty, audit scope, or accounting principles.
Additionally, during he Registrant's two most recent
fiscal years and any subsequent interim period preceding
MRS' dismissal, there were no disagreements with the
Registrant's former accountant on any matter of accounting
principles or practices, financial statement disclosure,
or auditing scope or procedures. A copy of this
disclosure has been provided to MRS. A copy of MRS'
letter addressed to the Securities and Exchange Commission
stating whether it agrees with the statements made by the
Registrant contained in this Item 4 is attached to this
Report as an exhibit.
OTHER EVENTS
The Board of Directors recommended to the Registrant
shareholders, and on September 30, 2002, the shareholders
of the Registrant approved, a Resolution to amend the
Registrant's Articles of Incorporation to:
- - create a Class A Common Stock from the authorized
capital stock consisting of 12,000,000 shares with
a par value of $0.001 per share,
- - create a Class B Common Stock from the authorized
capital stock consisting of 88,000,000 shares with
a par value of $0.001 per share, and
- - add a preferred stock class for 20.0 million
additional authorized shares.
ITEM 2. DESCRIPTION OF PROPERTY
The Company has no properties and at this time has
no agreements to acquire any properties. The Company
currently uses the offices of Management at no cost to the
Company. Management has agreed to continue this
arrangement until the Company completes a business
combination.
S
ITEM 3. LEGAL PROCEEDINGS
There is no litigation pending or threatened by or
against the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS
No matter was submitted to a vote of security
holders, through the solicitation of proxies or otherwise,
during the fourth quarter of the fiscal year covered by
this report.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Following a business combination, a target company
will normally wish to cause the Company's common stock to
trade in one or more United States securities markets.
The target company may elect to take the steps required
for such admission to quotation following the business
combination or at some later time.
If, after a business combination, the Company does
not meet the qualifications for listing on the Nasdaq
SmallCap Market, the Company may apply for quotation of
its securities on the NASD OTC Bulletin Board. In certain
cases the Company may elect to have its securities
initially quoted in the "pink sheets" published by the
National Quotation Bureau, Inc.
To have its securities quoted on the NASD OTC
Bulletin Board a company must:
(1) be a company that reports its current
financial information to the Securities and Exchange
Commission, bank regulators or insurance regulators;
(2) has at least one market maker who completes
and files a Form 211 with NASD Regulation, Inc.
The NASD OTC Bulletin Board is a dealer-driven
quotation service. Unlike the Nasdaq Stock Market,
companies cannot directly apply to be quoted on the NASD
OTC Bulletin Board, only market makers can initiate
quotes, and quoted companies do not have to meet any
quantitative financial requirements. Any equity security
of a reporting company not listed on the Nasdaq Stock
Market or on a national securities exchange is eligible.
In order to qualify for listing on the Nasdaq
SmallCap Market, a company must have at least (i) net
tangible assets of $4,000,000 or market capitalization of
$50,000,000 or net income for two of the last three years
of $750,000; (ii) a public float of 1,000,000 shares with
a market value of $5,000,000; (iii) a bid price of $4.00);
(iv) three market makers; (v) 300 shareholders, and (vi)
an operating history of one year or, if less than one
year, $50,000,000 in market capitalization. For continued
listing on the Nasdaq SmallCap Market, a company must have
at last (i) net tangible assets of $2,000,000 or market
capitalization of $35,000,000 or net income for two of the
last three years of $500,000; (ii) a public float of
500,000 shares with a market value of $1,000,000; (iii) a
bid price of $1.00; (iv) two market makers; and (v) 300
shareholders.
In general, there is greatest liquidity for traded
securities on the Nasdaq SmallCap Market, less on the NASD
OTC Bulletin Board, and least through quotation by the
National Quotation Bureau, Inc., on the "pink sheets". It
is not possible to predict where, if at all, the
securities of the Company will be traded following a
business combination.
During the past three years, the Company has sold
securities which were not registered as follows:
NUMBER OF
DATE NAME SHARES CONSIDERATION
06/29/2000 Peter R. Goss 500,000 $ 500
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION
The Company will attempt to locate and negotiate
with a business entity for the combination of that target
company with the Company. The combination will normally
take the form of a merger, stock-for-stock exchange or
stock-for-assets exchange (the "business combination").
In most instances the target company will wish to
structure the business combination to be within the
definition of a tax-free reorganization under Section 351
or Section 368 of the Internal Revenue Code of 1986, as
amended. No assurances can be given that the Company will
be successful in locating or negotiating with any target
business.
The Company has not restricted its search for any
specific kind of businesses, and it may acquire a business
which is in its preliminary or development stage, which is
already in operation, or in essentially any stage of its
business life. It is impossible to predict the status of
any business in which the Company may become engaged, in
that such business may need to seek additional capital,
may desire to have its shares publicly traded, or may seek
other perceived advantages which the Company may offer.
In implementing a structure for a particular
business acquisition, the Company may become a party to a
merger, consolidation, reorganization, joint venture, or
licensing agreement with another corporation or entity.
It is anticipated that any securities issued in any
such business combination would be issued in reliance upon
exemption from registration under applicable federal and
state securities laws. In some circumstances, however, as
a negotiated element of its transaction, the Company may
agree to register all or a part of such securities
immediately after the transaction is consummated or at
specified times thereafter. If such registration occurs,
it will be undertaken by the surviving entity after the
Company has entered into an agreement for a business
combination or has consummated a business combination.
The issuance of additional securities and their potential
sale into any trading market which may develop in the
Company's securities may depress the market value of the
Company's securities in the future if such a market
develops, of which there is no assurance.
The Company will participate in a business
combination only after the negotiation and execution of
appropriate agreements. Negotiations with a target
company will likely focus on the percentage of the Company
which the target company shareholders would acquire in
exchange for their shareholdings. Although the terms of
such agreements cannot be predicted, generally such
agreements will require certain representations and
warranties of the parties thereto, will specify certain
events of default, will detail the terms of closing and
the conditions which must be satisfied by the parties
prior to and after such closing and will include
miscellaneous other terms. Any merger or acquisition
effected by the Company can be expected to have a
significant dilutive effect on the percentage of shares
held by the Company's shareholders at such time.
The Company has entered into an agreement with
Peter R. Goss, its sole shareholder, to supervise the
search for target companies as potential candidates for a
business combination. The Agreement will continue until
such time as the Company has effected a business
combination. Peter R. Goss has agreed to pay all expenses
of the Company until such time as a business combination
is effected, without repayment. Peter R. Goss, the sole
Officer and Director of the Company, is the sole Officer
and Director and controlling Shareholder of Kaw
Acquisition Corporation.
The Company does not anticipate expending funds
itself for locating a target company. Peter R. Goss, the
Officer and Director of the Company, provides his services
without charge or repayment. The Company will not borrow
any funds to make any payments to the Company's
Management, its affiliates or associates. If Peter R.
Goss stops or becomes unable to continue to pay the
Company's operating expenses, the Company may not be able
to timely make its periodic reports required under the
Exchange Act nor to continue to search for an acquisition
target. In such event, the Company would seek alternative
sources of funds or services, primarily through the
issuance of its securities.
Peter R. Goss may only locate potential target
companies for the Company and is not authorized to enter
into any agreement with a potential target company binding
the Company. Peter R. Goss may provide assistance to
target companies incident to and following a business
combination, and receive payment for such assistance from
target companies. The Agreement with Peter R. Goss is not
exclusive and the Company may enter into similar
agreements with other persons or entities.
The Board of Directors has passed a Resolution
which contains a policy that the Company will not seek a
business combination with any entity in which the
Company's Officer, Director, shareholders or any affiliate
or associate serves as an officer or director or holds any
ownership interest.
ITEM 7. FINANCIAL STATEMENTS
The financial statements for the year ended
December 31, 2000, are attached to this filing.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
There were no changes in or disagreements with
accountants on accounting and financial disclosure for the
period covered by this report.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(A) OF THE EXCHANGE ACT
The Directors and Officers of the Company are as
follows:
Name Age Positions and
Offices Held
Peter R. Goss 64 President,
Secretary,
Director
There are no agreements or understandings for the
Officer or Director to resign at the request of another
person and the above-named Officer and Director is not
acting on behalf of nor will act at the direction of any
other person.
Set forth below is the name of the Director and
Officer of the Company, all positions and offices with the
Company held, the period during which he has served as
such, and the business experience during at least the last
five years:
Peter Goss graduated in 1959 from Temple University
with a B.S. Degree in Business Administration. In 1967,
Mr. Goss received his M.B.A. in Industrial Relations from
Temple University through the Graduate School. Over the
course of his career, Mr. Goss has worked for the U.S.
Government as a Management Analyst from 1961 to 1967, and
for the Radio Corporation of America as a Senior System
Analyst from 1967 to 1969. Currently, Mr. Goss serves as
President of Village Mortgage Corporation and as Trustee
of his land development and property management for his
family. Village Mortgage Corporation is involved with the
placement of residential and commercial loans, development
of .com companies, acquisition of venture capital, and
land development and home building. Mr. Goss has served
as President for Village Mortgage Corporation since 1987.
OTHER SIMILAR COMPANIES
Peter R. Goss, the President of the Company, has
been and is currently involved with companies similar to
this one. The initial business purpose of each of these
companies was or is to engage in a business combination
with an unidentified company or companies.
CONFLICTS OF INTEREST
A conflict may arise in the event that a similar
company with which Mr. Goss is affiliated also actively
seeks a target company. It is anticipated that target
companies will be located for the Company and other
similar companies in chronological order of the date of
formation of such companies or, in the case of companies
formed on the same date, alphabetically. However, other
companies may differ from the Company in certain items
such as place of incorporation, number of shares and
shareholders, working capital, types of authorized
securities, or other items. It may be that a target
company may be more suitable for or may prefer a certain
company formed after the Company. In such case, a
business combination might be negotiated on behalf of the
more suitable or preferred similar company regardless of
date of formation.
Mr. Goss has other ongoing business concerns. As
such, demands may be placed on the time of Mr. Goss which
would detract from the amount of time he is able to devote
to the Company. Mr. Goss intends to devote as much time
to the activities of the Company as required. However,
should such a conflict arise, there is no assurance that
Mr. Goss would not attend to other matters prior to those
of the Company.
The terms of a business combination may include
such terms as Mr. Goss remaining a Director or Officer of
the Company. The terms of a business combination may
provide for a payment by cash or otherwise to Peter Goss
by a target business for the purchase of all or part of
his common stock of the Company owed by Mr. Goss. Mr.
Goss would directly benefit from such employment or
payment. Such benefits may influence Mr. Goss' choice of
a target business.
Management may agree to pay finder's fees, as
appropriate and allowed, to unaffiliated persons who may
bring a target business to the Company where that
reference results in a business combination. The amount
of any finder's fee will be subject to negotiation, and
cannot be estimated at this time. No finder's fee will be
paid to the management or promoters of the Company, or to
their associates or affiliates. No loans of any type have
been, or will be, made to management or promoters of the
Company or to any of their associates or affiliates.
The Company will not enter into a business
combination, or acquire any assets of any kind for its
securities, in which management or promoters of the
Company or any affiliates or associates have any interest,
direct or indirect.
There are no binding guidelines or procedures for
resolving potential conflicts of interest. Failure by
management to resolve conflicts of interest in favor of
the Company could result in liability of management to the
Company. However, any attempt by shareholders to enforce
a liability of management to the Company would most likely
be prohibitively expensive and time consuming.
ITEM 10. EXECUTIVE COMPENSATION
The Company's Officer and Director does not receive
any compensation for his services rendered to the Company,
nor has he received such compensation in the past. The
Officer and Director is not accruing any compensation
pursuant to any agreement with the Company. However, the
Officer and Director of the Company anticipates receiving
benefits as a beneficial shareholder of the Company, and
as the Officer and Director.
No retirement, pension, profit sharing, stock
option or insurance programs or other similar programs
have been adopted by the Company for the benefit of its
employees.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of December 31,
2000, each person known by the Company to be the
beneficial owner of five percent or more of the Company's
common stock and the Director and Officer of the Company.
Except as noted, the holder thereof has sole voting and
investment power with respect to the shares shown.
Name and Address Amount of Beneficial Percentage
of Beneficial Owner Ownership Of Class
Peter Goss 500,000 100%
963 Valley View Drive
Meadowbrook PA 19046-1317
All Executive Officers
and Directors as a Group
(1 Person) 500,000 100%
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On June 29, 2000, the Company issued a total of
500,000 shares of common stock to the following for a
total of $500.00 in cash.
Number of Total
Name Shares Consideration
Peter R. Goss 500,000 $500
The Board of Directors has passed a Resolution
which contains a policy that the Company will not seek an
acquisition or merger with any entity in which the
Company's Officer, Director, shareholders or any affiliate
or associate serves as an officer or director or holds any
ownership interest. Management is not aware of any
circumstances under which this policy may be changed.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
99.3 Certification
(b) There were no reports on Form 8-K filed by
the Company during the quarter ended December 31, 2000.
[ remainder of page intentionally left blank ]
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d)
of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KAW ACQUISITION CORPORATION
By: /s/ Peter R. Goss
Peter R. Goss
President
Dated: March 28, 2003
Pursuant to the Securities Exchange Act of 1934,
this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on
the dates indicated.
NAME OFFICE DATE
/s/ Peter R. Goss Director March 28, 2003
Peter R. Goss
EXHIBIT 99.3
CERTIFICATION
I, Peter R. Goss, President, Chief Executive Officer and
Acting Chief Financial Officer of Kaw Acquisition
Corporation, certify that:
1. I have reviewed this annual report on
Form 10-KSB of Kaw Acquisition Corporation;
2. Based on my knowledge, this quarterly
report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under
which such statements were made, not misleading with
respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial
statements, and other financial information included in
this quarterly report, fairly present in all material
respects the financial condition, results of operations
and cash flows of the registrant as of, and for the
periods presented in this quarterly report;
4. I am responsible for establishing and
maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and I have:
a. designed such disclosure controls and
procedures to ensure that material information
relating to the registrant, including its
consolidated subsidiaries, is made known to me by
others within those entities, particularly during
the period in which this quarterly report is being
prepared;
b. evaluated the effectiveness of the
registrant's disclosure controls and procedures as
of a date within 90 days prior to the filing date
of this quarterly report (the "Evaluation Date"); and
c. presented in this quarterly report my
conclusions about the effectiveness of the
disclosure controls and procedures based on my
evaluation as of the Evaluation Date;
5. I have disclosed, based on my most recent
evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons
performing the equivalent function):
a. all significant deficiencies in the
design or operation of internal controls which
could adversely affect the registrant's ability to
record, process, summarize and report financial
data and have identified for the registrant's
auditors any material weaknesses in internal
controls; and
b. any fraud, whether or not material, that
involves management or other employees who have a
significant role in the registrant's internal
controls; and
6. I have indicated in this quarterly report
whether or not there were significant changes in internal
controls or in other factors that could significantly
affect internal controls subsequent to the date of my most
recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
By: /s/ Peter R. Goss
Peter R. Goss
President, Chief Executive Officer
and Acting Chief Financial Officer
Dated: March 28, 2003
KAW ACQUISITION CORPORATION
INDEX TO FINANCIAL STATEMENTS
Page
Independent Auditor's Report 1
Balance Sheet - December 31, 2000 2
Statement of Operations -
For the Period from May 3, 2000
(Date of Inception) to December 31, 2000 3
Statement of Cash Flows -
For the Period from May 3, 2000
(Date of Inception) to December 31, 2000 4
Statement of Changes in Stockholder's Equity -
For the Period from May 3, 2000
(Date of Inception) to December 31, 2000 5
Notes to Financial Statements 6
James J. Taylor
Certified Public Accounting
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Kaw Acquisition Corporation
(A Development Stage Company)
I have examined the accompanying balance sheet of Kaw
Acquisition Corporation (a development stage company) as
of December 31, 2000 and the related statements of
operations and retained deficit, cash flows, and
stockholder's equity for the period from May 3, 2000 (date
of inception) to December 31, 2000. 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 included 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. 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 Kaw Acquisition Corporation (a development
stage company) as of December 31, 2000, and the results of
its operations and retained deficit, cash flows, and
stockholder's equity for the period from May 3, 2000 (date
of inception) to December 31, 2000 in conformity with
generally accepted accounting principles.
March 28, 2003
/s/ James J. Taylor
555 IH35 South Suite 312 New Braunfels, Texas 78130
Telephone (830)624-1000 (830)624-0300
e-mail address: james_j_taylor@msn.com
-1-
KAW ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 2000
ASSETS
Cash $ 474
______
Total Assets $ 474
______
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES $ 0
STOCKHOLDER'S EQUITY:
Common stock - $0.001 par value, 100 million
shares authorized,
500,000 shares issued and outstanding 500
Retained Earnings (26)
______
Total Stockholder's equity 474
______
Total Liabilities and Stockholder's Equity $ 474
______
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
-2-
KAW ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND RETAINED DEFICITS
FOR THE PERIOD OF MAY 3, 2000 (DATE OF INCEPTION) TO
DECEMBER 31, 2000
INCOME $ 474
EXPENSES
Bank Charges 26
____
Total Expenses 26
____
NET INCOME (LOSS) (26)
RETAINED DEFICIT MAY 3, 2000 (date of inception) 0
____
RETAINED DEFICIT DECEMBER 31, 2000 (26)
____
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
-3-
KAW ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD OF MAY 3, 2000 (DATE OF INCEPTION) TO
DECEMBER 31, 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (26)
Adjustments to reconcile net income to net cash
flows from operating activities 0
Net cash provided by (used in) operating
activities (26)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock 500
Net cash provided by financing activities 500
NET INCREASE IN CASH AND CASH EQUIVALENTS 474
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 0
CASH AND CASH EQUIVALENTS, END OF PERIOD $474
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
-4-
KAW ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE PERIOD OF MAY 3, 2000 (DATE OF INCEPTION) TO
DECEMBER 31, 2000
COMMON TOTAL
STOCK COMMON STOCK-
SHARES STOCK RETAINED HOLDER'S
DATE ISSUED AMOUNT DEFICITS EQUITY
5/3/00
Original common
stock issue 500,000 $ 500 $ 0 $500
12/31/00
Net loss for the
period of May 3,
2000 to December
31, 2000 (26) (26)
12/31/00
Totals 500,000 $ 500 $(26) $474
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
-5-
KAW ACQUISITION CORPORATION
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM MAY 3, 2000 (DATE OF INCEPTION) TO
DECEMBER 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND BUSINESS OPERATIONS:
Kaw Acquisition Corporation was incorporated in
Nevada on May 3, 2000 to serve as a vehicle to
effect a merger, exchange of capital stock, asset
acquisitions or other business combinations with a
domestic or foreign private business. At December
31, 2000, the Company had not yet commenced any
formal business operations, and all activity to
date relates to the Company's formation and
proposed fund raising. The Company's fiscal year
ends December 31.
The Company's ability to commence operations is
contingent upon its abilities to identify a
prospective target business and raise capital that
it will require through the issuance of equity
securities, dent securities, bank borrowings or a
combination thereof.
USE OF ESTIMATES:
The preparation of the 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 revenues and
expenses during the reporting period. Actual
results could differ from those estimates.
CASH AND CASH EQUIVALENTS:
For purposes of the statement of cash flows, the
Company considers all highly liquid investments
purchased with an original maturity of three months
or less to be cash equivalents.
FEDERAL INCOME TAXES:
The Company accounts for income taxes under the
Financial Accounting Standards Board of Financial
Accounting Standards No. 109, "Accounting for
Income Taxes" ("Statement 109"). Provisions for
income taxes are calculated on a pretax income
reported for financial statement purposes.
Deferred income taxes (liability) or benefit from
income taxes (asset) are provided through timing
differences between the reporting of financial
statement income and taxable income. If material,
these differences will be recorded as deferred
income taxes of benefit from income taxes. Due to
the Company's operational inactivity from the date
of inception through December 31, 2000, no deferred
taxes or benefit from income taxes has been provided.
NOTE 2 - STOCKHOLDER'S EQUITY:
In the original charter issued by the State of
Nevada on May 3, 2000, the Company was authorized
to issue 10,000,000 shares of common stock at a par
value of $0.001 per share. Of the number of shares
authorized, 500,000 shares have been issued to
Peter R. Goss, pursuant to Rule 506, for the
aggregate consideration of $500.
NOTE 3 - SERVICES AGREEMENT:
On June 29, 2000, the Company signed an agreement
with Peter R. Goss, a related entity. The
Agreement calls for Peter R. Goss to provide the
following services, without reimbursement from the
Company, until the Company enters into a business
combination as described in Note 1:
1. Preparation and filing of required
documents with the Securities and Exchange
Commission.
2. Location and review of potential target
companies.
3. Payment of all corporate, organizational,
and other costs incurred by the Company.
NOTE 4 - SUBSEQUENT EVENTS:
On September 30, 2002, at a duly called meeting of
the Board of Directors, a resolution amending the
articles of incorporation to provide for Class A
and Class B common stock and to provide for
Preferred Shares. The classes are as follows:
1. Class A Common Stock consisting of
12,000,000 shares with a par value of
$0.001 per share.
2. Class B Common Stock consisting of
88,000,000 shares with a par value of
$0.001 per share.
3. Preferred Stock consisting of 20,000,000
shares with a par value of $0.001 per share.