-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H5XjEWt8mqzAJgWrJIY5M/4g2l3NmwPhQnWrHcpbEv7Up60rfo8JvN5r/hikHnCw v7h4qOkV9TsHAtNhes4wNQ== 0001227528-04-000015.txt : 20040323 0001227528-04-000015.hdr.sgml : 20040323 20040323135147 ACCESSION NUMBER: 0001227528-04-000015 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030630 FILED AS OF DATE: 20040323 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN PRODUCT CORP CENTRAL INDEX KEY: 0001114098 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 880440536 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-31663 FILM NUMBER: 04684641 BUSINESS ADDRESS: STREET 1: 3450 E. RUSSELL ROAD STREET 2: SUITE 111 CITY: LAS VEGAS STATE: NV ZIP: 89120 BUSINESS PHONE: 7029516211 MAIL ADDRESS: STREET 1: 3450 E. RUSSELL ROAD STREET 2: SUITE 111 CITY: LAS VEGAS STATE: NV ZIP: 89120 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN IR TECHNOLOGIES INC DATE OF NAME CHANGE: 20000928 10QSB 1 m10qsb06302003.txt 10QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003 Commission File # 000-31663 AMERICAN CAPITAL PARTNERS LIMITED, INC. (Exact name of small business issuer as specified in its charter) NEVADA (State or other jurisdiction of incorporation or organization) 88-0440536 (IRS Employer Identification Number) 319 CLEMATIS STREET, SUITE 527, WEST PALM BEACH, FL 33401 (Address of principal executive offices)(Zip Code) (561) 366-9211 (Registrant's telephone no., including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 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 [ ] No [X] The number of shares outstanding of the Company's common stock as of June 30, 2003 is shown below: Title of Class Number of Shares Outstanding Common Stock, par value $.001 per share 26,414,107 Documents Incorporated by Reference: None AMERICAN CAPITAL PARTNERS LIMITED, INC. FORM 10-QSB
PART I. FINANCIAL INFORMATION Item 1. Financial Statements (unaudited) Condensed balance sheets at June 30, 2003and December 31, 2002 Condensed statements of operations for the Six Months ended June 30, 2003and 2002 Condensed statements of cash flows for the Six Months ended June 30, 2003and 2002 Notes to condensed financial statements December 31, 2002 Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations PART II OTHER INFORMATION Item 1. Legal Proceedings Item 2. Changes in Securities Item 3. Defaults Upon Senior Securities Item 4. Submission of Matters to a Vote of Security Holders Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K Signatures - ------------
PART I - FINANCIAL INFORMATION ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS The financial statements of the company are set forth beginning on page F-1. AMERICAN PRODUCT CORPORATION FINANCIAL STATEMENTS JUNE 30, 2003 AND DECEMBER 31, 2002 (UNAUDITED) (With Report of Independent Certified Public Accountants Thereon) TABLE OF CONTENTS PAGE NO. Independent Accountants Report 1 Financial statements Balance sheet 2 Statements of operations 3 Statement of stockholders' deficit 4 Statements of cash flows 6 Notes to financial statements 7 INDEPENDENT ACCOUNTANT'S REPORT To the Board of Directors of American Product Corporation We have reviewed the accompanying balance sheet of American Product Corporation (a Nevada corporation) as of June 30, 2003 and December 31, 2002 and the related statements of income and accumulated deficit, and cash flows for the three months then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. All information included in these financial statements is the representation of the management of American Product Corporation. A review consists principally of inquiries of Company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles. The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As disclosed in Note 1 to the financial statements, the Company has had limited operations and has not established a long-term source of revenue. This raises substantial doubt about its ability to continue as a going concern. Management's plan in regards to these matters is also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. CFO Advantage, Inc. March 15, 2004 Las Vegas, Nevada AMERICAN PRODUCT CORPORATION BALANCE SHEETS AS OF JUNE 30, 2003 AND DECEMBER 31, 2002
ASSETS (Unaudited) (Audited) --------------- ---------------- as of 6/30/2003 as of 12/31/2002 --------------- ---------------- CURRENT ASSETS Cash $ - - Accounts receivable, net of reserve for bad debt - - Due from officer - - Inventory - - --------------- ---------------- Total current assets - - --------------- ---------------- PROPERTY AND EQUIPMENT, net of accumulated depreciation - - OTHER ASSETS Deposits - - --------------- ---------------- Total other assets - - TOTAL ASSETS $ - $ - =============== ================ LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Accounts payable $ 278,378 $ 278,378 Due to related parties - - Notes payable - - Notes payable - related party - - Payroll liability - - Other current liabilities 56,647 56,647 --------------- ---------------- Total current liabilities 335,025 335,025 --------------- ---------------- TOTAL LIABILITIES 335,025 335,025 STOCKHOLDERS' EQUITY (DEFICIT) Common stock, $0.001 par value, 20,000,000 shares authorized, 21,414,107 shares issued and outstanding as of June 30, 2003 and 20,414,107 as of December 31, 2002 21,414 20,414 Additional paid in capital - common stock 1,322,610 1,313,610 Preferred stock, Class A, 6%, cumulative, convertible, $0.001 par value, 5,000,000 shares authorized, no shares issued and outstanding as of June 30, 2003 and no shares issued and outstanding as of December 31, 2002 - - Additional paid in capital - preferred stock - - Subscription receivable - - Accumulated deficit (1,679,049) (1,669,049) --------------- ---------------- Total stockholders' equity (deficit) (335,025) (335,025) --------------- ---------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ - $ - =============== ================ The accompanying independent accountants' review report and notes to financial statements should be read in conjunction with these Balance Sheets.
AMERICAN PRODUCT CORPORATION. STATEMENTS OF INCOME AND ACCUMULATED DEFICIT FOR THE PERIODS ENDED JUNE 30, 2003 AND DECEMBER 31, 2002
Unaudited Audited --------------- ----------------- January 1, 2003 January 1, 2002 to to June 30, 2003 December 31, 2002 --------------- ----------------- REVENUES - $ 67,781 COST OF REVENUES - 13,596 GROSS PROFIT (LOSS) - 54,185 EXPENSES: General and administrative 10,000 149,557 Depreciation - 1,811 Professional fees - 358,754 Non-cash stock compensation - (180,670) -------------- ----------------- Total expenses 10,000 329,451 -------------- ----------------- Operating income (loss) (10,000) (275,266) -------------- ----------------- OTHER INCOME (EXPENSE) Other income - 6,441 Interest expense - (1) Interest income - 954 Forgiveness of debt - 41,077 Legal settlement - (100,000) Other expenses - (1,153) -------------- ----------------- Total other income (expense) - (52,682) -------------- ----------------- NET INCOME (LOSS) (10,000) (327,948) ACCUMULATED DEFICIT, beginning of period (1,669,049) (1,341,101) -------------- ----------------- ACCUMULATED DEFICIT, end of period (1,679,049) (1,669,049) ============== ================= PER SHARE INFORMATION: Weighted average number of shares outstanding (basic) 20,751,124 19,024,296 ============== ================= Net income (loss) per common share (basic) - $ (0.02) ============== ================= Weighted average number of shares outstanding (diluted) 20,751,124 19,024,296 ============== ================= Net income (loss) per common share (diluted) - $ (0.02) ============== ================= The accompanying independent accountants' review report and notes to financial statements should be read in conjunction with these Statements of Income and Accumulated Deficit.
AMERICAN PRODUCT CORPORATION STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY AS OF JUNE 30, 2003
Common Common Additional Preferred Preferred APIC Stock Stock Paid-in Stock Shares Stock Preferred Subscribed Income Total Shares Amount Capital Series A Series A Stock Stock (Deficit) Equity ---------- -------- ----------- ------------ --------- --------- ---------- ------------ ------------- Balances at December 31,2000 7,135,267 $ 7,135 $ 242,918 - $ - $ - $ (44,134) $(411,535) $ (205,616) Issuance of common stock for services 6,210,520 6,211 563,245 - - - - - 569,456 Deferred compensation recognized - - - - - - 44,134 - 44,134 Deferred compensation other assets - - - - - - (200,156) - (200,156) Issuance for stock warrant - - 12,000 - - - - - 12,000 Net profit (loss) of year ended December 31, 2001 (931,693) (931,693) Balance at December 31,2001 13,345,787 $ 13,347 $ 818,163 - $ - $ - $ (200,156) $(1,343,228) $ (711,874) ---------- --------- ----------- ----------- --------- ---------- ---------- ------------ ----------- Deferred compensation recognized - - - - - - 170,806 - 170,806 Issuance of common stock for services 7,068,320 7,068 507,447 - - - - - 514,515 Issuance of preferred shares - - - 1,945,680 1,946 247,101 - - 249,047 Cancellation of preferred shares - - - (1,945,680) (1,946) (247,101) - - (249,047) Prior period adjustment - - - - - - - 2,127 2,127 Deferred compensation recognized - - - - - - 147,448 - 147,448 Cancellation of stock warrant - - (12,000) - - - - - (12,000) Deferred compensation recognized - - - - - - - (118,098) (118,098) Net profit (loss) for quarter ended December 31, 2002 (327,948) (327,948) Balance at December 31,2002 20,414,107 $ 20,414 $1,313,610 - $ - $ - $ - $ (1,669,049) $ (335,025) ---------- ---------- ----------- ------------ ---------- ---------- ---------- -------------- ----------- Issuance of common stock for services 1,000,000 1,000 9,000 - - - - - 19,000 Net profit (loss) for quarter ended June 30, 2003 - - - - - - - (10,000) (10,000) ---------- ---------- ------------ ------------ ---------- ---------- ---------- -------------- ----------- Balance at June 30, 2003 21,414,107 $ 21,414 $1,322,610 - $ - $ - $ - $ (1,679,049) $ (326,025) ========== ========== ============ ============ ========= ========== ========== ============== =========== The accompanying independent accountants' review report and notes to financial statements should be read in conjunction with this Statement of Changes in Stockholders' Equity.
AMERICAN PRODUCT CORPORATION STATEMENTS OF CASH FLOWS FOR THE PERIODS ENDED JUNE 30, 2003 AND DECEMBER 31, 2002 UNAUDITED
Six Twelve Months Ended Months Ended ------------- ------------ 6/30/03 12/31/02 ------------- ------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net Income / (Loss) from Operations $ (10,000.00) $ (327,948) Adjustments to reconcile net income to net cash provided Services Received for Stock 10,000 200,156 Depreciation Expense - 1,811 Increase) / Decrease in Accounts Receivable - 3,379 (Increase) / Decrease in Due from Officers - 20,690 (Increase) / Decrease in Other Assets - 1,360 Increase / (Decrease) in Due to Related Party - (532,707) Increase / (Decrease) in Accounts Payable - 101,573 ------------- ------------ Net cash provided by (used in) operating activities - (475,039) ------------- ------------ CASH FLOWS FROM INVESTING ACTIVITIES: (Purchase)/Sale of Equipment - 11,162 ------------- ------------- Net cash provided by (used in) investing activities - 11,162 ------------- ------------- CASH FLOWS FROM FINANCING ACTIVITIES: Issuance of Stock - 502,515 Increase/(Decrease) in Short Term Notes Payable - (28,000) Increase/(Decrease) in Short Term Notes Payable - Related Party - (12,300) ------------- ------------- Net cash provided by (used in) financing activities - 462,215 ------------- ------------- Balance at beginning of period - 1,662 Net increase (decrease) in cash - (1,662) ------------- ------------- Balance at end of period $ - $ (0) ============= ============= SUPPLEMENTAL INFORMATION: Interest Paid $ - $ (1) ============= ============= Taxes Paid $ - $ - ============= ============= The accompanying independent accountants' review report and the notes to financial statements should be read in conjunction with these Statements of Cash Flows.
AMERICAN PRODUCT CORPORATION (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS 1. DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT POLICIES Description of business and history - American Product Corporation, formally known as American IR Technologies, Inc., (the Company) was incorporated in the State of Nevada on October 29, 1999. On November 18, 2002, the Company changed its name to American Product Corp. The Company is a publicly trade company currently listed on the OTC Pink Sheets under the symbol APRP. The principal business objective of the Company is to design and market consumer electronics that utilize infrared technology. The Company was in the development stage from its inception on October 29, 1999 through December 31, 2000. The Company has previously entered into a license agreement with an affiliate, American Infrared Technologies, Inc. (Canada), a Canadian corporation, for exclusive rights to their procedures, practices, and intellectual property. This agreement is the sole source of product development for the Company. On May 29, 2002, the company entered into a settlement with Canada regarding the license agreement (See Note 3). Until October of 2002, American Products manufactured and marketed consumer electronic products that targeted the home health and safety markets. However, sales from these products were not sufficient to enable the company to continue operations. In October 2002, the Company changed its strategy due to poor operating conditions and their operating results coupled with difficulties in raising capital through debt and equity sources. The Company adopted a new strategy during the fourth quarter of 2002 that committed to the disposal of its current business and to seek a merger/acquisition transaction with a Company having better financial resources. As of December 31, 2002, the Company ceased all operating activities and has disposed of most of its assets. The Company currently operates as a development stage company, while formulating a plan to improve it financial position. Going concern - The Company incurred net losses of approximately $1,679,049 from the period of October 29, 1999 (Date of Inception) through June 30, 2002 and has ceased its operations, thus, is classified as a development stage company, raising substantial doubt about the Company's ability to continue as a going concern. The Company will seek additional sources of capital through the issuance of debt or equity financing, but there can be no assurance the Company will be successful in accomplishing its objectives. The ability of the Company to continue as a going concern is dependent on additional sources of capital and the success of the Company's plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Basis of accounting - The Company's policy is to prepare the financial statements on the accrual basis of accounting. Year end - The Company's year end is December 31. Cash and cash equivalents - Cash and cash equivalents consist of highly liquid investments with maturities of three months or less when purchased. 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. 7 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT POLICIES (CONTINUED) Property and equipment and rental properties - Property and equipment and rental properties are stated at cost less accumulated depreciation. Depreciation is provided principally on the straight-line method over the estimated useful lives of the assets, which are generally 3 to 27 years. The amounts of depreciation provided are sufficient to charge the cost of the related assets to operations over their estimated useful lives. The cost of repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and renewals are capitalized. Upon sale or other disposition of a depreciable property, cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in other income. The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated useful life of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. The Company uses an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability. As of June 30, 2003 and December 31, 2002, respectively, the company has $0 in assets. Intangible Assets - Under guidance of SFAS 142, Net assets of companies acquired in purchase transactions are recorded at fair value at the date of acquisition, as such, the historical cost basis of individual assets and liabilities are adjusted to reflect their fair value. Identified intangibles are amortized on an accelerated or straight-line basis over the period benefited. Goodwill is not amortized, but is reviewed for potential impairment on an annual basis at the reporting unit level. The impairment test is performed in two phases. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired; however, if the carrying amount of the reporting unit exceeds its fair value, an additional procedure must be performed. That additional procedure compares the implied fair value of the reporting unit's goodwill (as defined in SFAS 142) with the carrying amount of that goodwill. An impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. Other intangible assets are evaluated for impairment if events and circumstances indicate a possible impairment. Such evaluation of other intangible assets is based on undiscounted cash flow projections. Income taxes - The Company accounts for its income taxes in accordance with Statement of Financial Accounting Standards No. 109, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. As of June 30, 2003, the Company has not filed a tax return with the Internal Revenue Service since 2000. Management feels the Company will have a net operating loss carryover to be used for future years. Such losses may not be fully deductible due to the significant amounts of non-cash service costs and change in majority ownership control. The Company has established a valuation allowance for the full tax benefit of the operating loss carryovers due to the uncertainty regarding realization. Inventory Valuation - Inventories are stated at the lower of cost or market, cost being determined on the first in, first out (FIFO) basis. 8 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT POLICIES (CONTINUED) Net loss per common share - The Company computes net loss per share in accordance with SFAS No. 128, Earnings per Share (SFAS 128) and SEC Staff Accounting Bulletin No. 98 (SAB 98). Under the provisions of SFAS 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is antidilutive. For the years ended June 30, 2003 and December 31, 2002, no options and warrants were excluded from the computation of diluted earnings per share because their effect would be antidilutive. Comprehensive income (loss) - The Company has no components of other comprehensive loss. Accordingly, net loss equals comprehensive loss for all periods. Revenue recognition - The Company has no revenues to date from its operations. Warranty - The Company sells the majority of its product with a limited repair and replacement warranty. The accompanying financial statements do not include a provision for estimated warranty claims based on the Company's experience that no material claims have been made. Research and Development- The Company expenses its research and development in the periods incurred. Advertising costs - The Company recognizes advertising expenses in accordance with Statement of Position 93-7 "Reporting on Advertising Costs." Accordingly, the Company expenses the costs of producing advertisements at the time production occurs, and expenses the costs of communicating advertisements in the period in which the advertising space or airtime is used. The Company has recorded no significant advertising costs for the six months ended June 30, 2003 and the year ended December 31, 2002, respectively. Stock-based compensation - The Company applies Accounting Principles Board ("APB") Opinion No. 25, Accounting for Stock Issued to Employees, and Related Interpretations, in accounting for stock options issued to employees. Under APB No. 25, employee compensation cost is recognized when estimated fair value of the underlying stock on date of the grant exceeds exercise price of the stock option. For stock options and warrants issued to non-employees, the Company applies SFAS No. 123, Accounting for Stock- Based Compensation, which requires the recognition of compensation cost based upon the fair value of stock options at the grant date using the Black-Scholes option pricing model. Dividend Policy - The Company has not yet adopted any policy regarding payment of dividends. The Company has authorized 1,945,680 shares of preferred stock with a par value of $0.001. . As of December 17, 2003, the series A preferred stock has been cancelled by the Company. Preferred shares carry two votes for every one preferred share and have priority in the event of company liquidation. Series A shares have annual dividends of 6% that are payable quarterly. The shares are convertible to common shares on a 1 for 1.6 basis at the holders' option. New accounting pronouncements - In June 2002, the FASB issued Statement No. 146, Accounting for Costs Associated With Exit or Disposal Activities. This statement requires the recognition of a liability for a cost associated with an exit or disposal activity when the liability is incurred versus the date the Company commits to an exit plan. In addition, this statement states the liability should be initially measured at fair value. The statement is effective for exit or disposal activities that are initiated after December 31, 2002. The Company does not believe that the adoption of this pronouncement will have a material effect on its financial statements. 9 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT POLICIES (CONTINUED) New accounting pronouncements (continued) In January 2003, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure. This statement provides alternative methods of transition for a voluntary change to the fair value-based method of accounting for stock-based employee compensation. In addition, this statement also amends the disclosure requirements of SFAS No. 123 to require more prominent and frequent disclosures in the financial statements about the effects of stock-based compensation. Because the Company continues to account for employee stock-based compensation under APB Opinion No. 25, the transitional guidance of SFAS No. 148 has no effect on the financial statements at this time. In November 2002, the Financial Accounting Standards Board issued FASB Interpretation No. 45 ("FIN No. 45"), Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others an interpretation of SFAS No. 5, 57, and 107 and rescission of FASB Interpretation No. 34, was issued. FIN No. 45 clarifies the requirements of SFAS No. 5, Accounting for Contingencies, relating to a guarantor's accounting for, and disclosure of, the issuance of certain types of guarantees. The adoption of the provisions of FIN No. 45 did not have a material impact on the Company's results of operations, financial position or cash flows. In January 2003, the FASB issued Interpretation No. 46, Consolidation of Variable Interest Entities. This interpretation establishes standards for identifying a variable interest entity and for determining under what circumstances a variable interest entity should be consolidated with its primary beneficiary. Until now, a company generally has included another entity in its consolidated financial statements only if it controlled the entity through voting interests. Interpretation No. 46 changes that by requiring a variable interest entity to be consolidated by a company if that company is subject to a majority of the risk of loss from the variable interest entity's activities or is entitled to receive a majority of the entity's residual returns or both. The Company does not believe that the adoption of this pronouncement will have a material effect on its financial statements. 2. STOCKHOLDER'S EQUITY On February 8, 2002, the Company issued 1,945,680 shares of Series A Preferred Stock to two executives. This stock is cumulative, with an annual dividend of 6%, carrying two (2) votes per preferred share. These shares become convertible on July 1, 2002 into 1.6 common shares for every 1 preferred share. They are convertible at the option of the owner. As of December 17, 2003, the series A preferred stock has been cancelled by the Company. During 2002, the Company issued 11,068,320 shares of common stock to various consultants. On December 8, 2003, the Company cancelled 5,000,000 shares of the common stock issued during the year ended 2002. An additional 4,578,000 shares of common stock were cancelled on December 17, 2003. On May 28, 2003, the Company issued 1,000,000 shares in exchange for payment towards a prior debt from Mark Kane of Manhattan Computer Products, Inc. (See Note 5) On December 8, 2003, the Company issued 50,000,000 shares in exchange for 100% of the ownership interest of a private company. The company plans to file the financials and additional information related to this acquisition shortly after filing the 2002 10-KSB. 3.LICENSE AGREEMENT On December 22, 1999, the Company entered into a five-year technology license agreement with Canada. Certain officers and directors of Canada are also officers and directors of the Company. The license agreement provides the Company with the exclusive rights to all procedures, practices and intellectual property related to 10 3. LICENSE AGREEMENT (CONTINUED) Canada's technologies and applications. According to the agreement, the Company has agreed to pay Canada a royalty of 3% of all revenues derived from the use of the technologies licensed from Canada. The royalty is payable monthly. Additionally, the Company has a 30-day right of first refusal to license additional technologies developed by Canada. The Company does not intend to assign a value to the technology received from Canada because there appears to be no discernable value. See Note 6 ("Contingencies and Commitments") regarding the company's litigation related to the license agreement. 4. STOCK OPTIONS There are no stock options or warrants as of June 30, 2003 and December 31, 2002, respectively. 5. LITIGATION The Company incurred substantial debt in their attempt to manufacture and market consumer electronic products. Several of the creditors have filed suit and two default judgments have been filed These claims total $55,401.99 plus interest and attorneys' fees. Alt, Inc. sued American IR Technologies, Inc. on December 19, 2001, Case No. A444128, ALT, Inc. vs. American IR Technologies, Inc. in the District Court of Clark County, Nevada, 8th Judicial District. A default judgment was entered against American IR Technologies in the amount of $21,542 plus penalties, fees and interest on April 9, 2002. Netcore Technologies filed a complaint for damages against American IR Technologies, Inc. on April 5, 2002, Case No. 020-004921 001, Netcore Technologies. vs. American IR Technologies, Inc in the Justice Court, Las Vegas Township, Clark County, Nevada, 8th Judicial District. Netcore Technologies claims total $5,440.80 plus interest and reasonable attorneys fees. Stephen A. Zrenda, Jr., P.C. filed a petition against American IR Technologies, Inc. on January 29, 2002, Case No. CJ-2002-848, Stephen A. Zrenda, Jr., P.C. vs. American IR Technologies, Inc and Ronald A. Ryan in the District Court, Oklahoma County, Oklahoma. Stephen A. Zrenda, Jr. P.C. claims total $5,602.42 as well as any accrued or accruing interest, court costs attorneys' fees and expenses. High Impact Television, Inc. sued American IR Technologies, Inc. on December 24, 2001, Case No. 01 HL 02183, High Impact Television. vs. American IR Technologies, Inc. and Does 1 through 10, inclusive in the Superior Court, Orange County, California. A default judgment was entered against American IR Technologies in the amount of $13,191.80 on February 6, 2002. Today's Staffing, Inc. sued American IR Technologies, Inc. on December 28, 2001, Case No. A444405, Today's Staffing, Inc. vs. American IR Technologies, Inc. in the District Court of Clark County, Nevada, 8th Judicial District. Today's Staffing claims total $10,526.80 plus interest through the filing of $875.67 plus attorneys' fees in the amount of $3,500.00. Mark Kane, an individual sued American Capital Partners Limited, Inc. on February 18, 2004, Case No. A480784, Mark Kane vs. American Capital Partners Limited, Inc. formerly known as American Product Corporation in the District Court of Clark County, Nevada for claims $10,000. 11 6. CONTINGENCIES AND COMMITMENTS The Company has received common stock subscriptions in the amount of $29,350. The Company is reporting this as part of shareholder's equity. The Company issued stock for services and is periodically expensing these services as the work is performed. The stock subscriptions were fully expensed as of December 31, 2002. 7. SUBSEQUENT EVENTS On December 8, 2003, the Company issued 50,000,000 shares in exchange for 100% of the ownership interest of a private company. The company plans to file the financial statements and additional information related to this acquisition shortly after filing the 2002 10-KSB. 8. CHANGES TO PRIOR YEAR FINANCIALS For the period ended December 31, 2002, the Company recorded a prior period adjustment of $2,127 due to an error in depreciating some property over 3- years rather than 5-years and in depreciating some property over 5-years rather than 7-years. 12 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion should be read in conjunction with our unaudited consolidated interim financial statements and related notes thereto included in this quarterly report and in our audited consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") contained in our Form 10-KSB for the year ended December 31, 2002. Certain statements in the following MD&A are forward looking statements. Words such as "expects", "anticipates", "estimates" and similar expressions are intended to identify forward looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. See "Special Note Regarding Forward Looking Information" below. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Some of the statements under "Description of Business," "Risk Factors," "Management's Discussion and Analysis or Plan of Operation," and elsewhere in this Report and in the Company's periodic filings with the Securities and Exchange Commission constitute forward-looking statements. These statements involve known and unknown risks, significant uncertainties and other factors what may cause actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward- looking statements. Such factors include, among other things, those listed under "Risk Factors" and elsewhere in this Report. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "intends," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of such terms or other comparable terminology. The forward-looking statements herein are based on current expectations that involve a number of risks and uncertainties. Such forward-looking statements are based on assumptions that the Company will obtain or have access to adequate financing for each successive phase of its growth, that there will be no material adverse competitive or technological change in condition of the Company's business, that the Company's President and other significant employees will remain employed as such by the Company, and that there will be no material adverse change in the Company's operations, business or governmental regulation affecting the Company. The foregoing assumptions are based on judgments with respect to, among other things, further economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the Company's control. Although management believes that the expectations reflected in the forward- looking statements are reasonable, management cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither management nor any other persons assumes responsibility for the accuracy and completeness of such statements. GENERAL American Capital Partners Limited, Inc. ("ACP" or the "Company") is a Nevada Corporation formed on October 29, 1999 under the name American IR Technology, Inc. On November 18, 2002, the Company changed its name to American Product Corp. On January 16, 2004, the Company changed its name to American Capital Partners Limited, Inc. The Company is a publicly trade company currently listed on the OTC Pink Sheets under the symbol APRJ. Since its inception, the Company has suffered recurring losses from operations and has been dependent on existing stockholders and new investors to provide the cash resources to sustain its operations. Currently, the Company has ceased all operations. RESULTS OF OPERATIONS Until October of 2002, American Products manufactured and marketed consumer electronic products that targeted the home health and safety markets. However, sales from these products were not sufficient to enable the company to continue operations. In October of 2002, management of the Company acknowledged that expenses significantly exceeded the revenue being derived from the sale of the product. Therefore, management reached a determination that it would not be feasible for the Company to develop, manufacture and market electronic products that targeted the home health and safety markets. Upon reaching that determination, management adopted the new business plan summarized under "Plan of Operations," below. Currently, there are no assets in the Company. All operations have ceased and all inventory and other assets were sold or otherwise utilized to satisfy obligations of the Company. However, the liquid assets of the Company were not sufficient to pay many of the creditors and as a result several of the creditors have filed suit and two default judgments have been filed. These claims total $55,401.99 plus interest and attorneys' fees. See Item 3 - Legal Proceedings. PLAN OF OPERATIONS Management intends to seek out and pursue a business combination with one or more existing private business enterprises that might have a desire to take advantage of the Company's status as a public corporation. Management does not intend to target any particular industry but, rather, intends to judge any opportunity on its individual merits. See "Item 1. Description of Business - Risk Factors" LIQUIDITY AND CAPITAL RESOURCES The Company is currently not liquid and has no capital in which to continue operations. The Company is currently a development stage company. There can be no assurance that any of the plans developed by the Company will produce cash flows sufficient to ensure its long-term viability. 2004 OUTLOOK Management intends to seek out and pursue a business combination with one or more existing private business enterprises that might have a desire to take advantage of the Company's status as a public corporation. Management does not intend to target any particular industry but, rather, intends to judge any opportunity on its individual merits. ITEM 3. EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES (a) Evaluation of disclosure controls and procedures. Our principal executive officer and principal financial officer, after evaluating the effectiveness of the Company's "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 Rules 13a-14(c) and 15-d-14(c)) as of a date (the "Evaluation Date") within 90 days before the filing date of this quarterly report, has concluded that as of the Evaluation Date, our disclosure controls and procedures were adequate and designed to ensure that material information relating to our consolidated subsidiaries and us would be made known to him by others within those entities. (b) Changes in internal controls. There were no significant changes in our internal controls or to our knowledge, in other factors that could significantly affect our disclosure controls and procedures subsequent to the Evaluation Date. PART II ITEM 1. LEGAL PROCEEDINGS The Company incurred substantial debt in their attempt to manufacture and market consumer electronic products. Several of the creditors have filed suit and two default judgments have been filed. These claims total $55,401.99 plus interest and attorneys' fees. Alt, Inc. sued American IR Technologies, Inc. on December 19, 2001, Case No. A444128, ALT, Inc. vs. American IR Technologies, Inc. in the District Court of Clark County, Nevada, 8th Judicial District. A default judgment was entered against American IR Technologies in the amount of $21,542 plus penalties, fees and interest on April 9, 2002. Netcore Technologies filed a complaint for damages against American IR Technologies, Inc. on April 5, 2002, Case No. 020-004921 001, Netcore Technologies. vs. American IR Technologies, Inc in the Justice Court, Las Vegas Township, Clark County, Nevada, 8th Judicial District. Netcore Technologies claims total $5,440.80 plus interest and reasonable attorneys fees. Stephen A. Zrenda, Jr., P.C. filed a petition against American IR Technologies, Inc. on January 29, 2002, Case No. CJ-2002-848, Stephen A. Zrenda, Jr., P.C. vs. American IR Technologies, Inc and Ronald A. Ryan in the District Court, Oklahoma County, Oklahoma. Stephen A. Zrenda, Jr. P.C. claims total $5,602.42 as well as any accrued or accruing interest, court costs attorneys' fees and expenses. High Impact Television, Inc. sued American IR Technologies, Inc. on December 24, 2001, Case No. 01 HL 02183, High Impact Television. vs. American IR Technologies, Inc. and Does 1 through 10, inclusive in the Superior Court, Orange County, California. A default judgment was entered against American IR Technologies in the amount of $13,191.80 on February 6, 2002. Today's Staffing, Inc. sued American IR Technologies, Inc. on December 28, 2001, Case No. A444405, Today's Staffing, Inc. vs. American IR Technologies, Inc. in the District Court of Clark County, Nevada, 8th Judicial District. Today's Staffing claims total $10,526.80 plus interest through the filing of $875.67 plus attorneys' fees in the amount of $3,500.00. Mark Kane, an individual sued American Capital Partners Limited, Inc. on February 18, 2004, Case No. A480784, Mark Kan vs. American Capital Partners Limited, Inc. formerly known as American Product Corporation in the District Court of Clark County, Nevada for claims $10,000. ITEM 2. CHANGES IN SECURITIES The following information sets forth certain information for all securities the Company issued from January 1, 2003 through June 30, 2003, in transactions without registration under the Act. NONE ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS NONE. ITEM 5. OTHER INFORMATION Not applicable ITEM 6. EXHIBITS AND REPORTS (a) The following documents are filed as part of this report: 31.1 Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. 31.2 Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. 32.1 Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. 32.1 Certification of Principal Financial and Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. (b) Reports on Form 8-K: None SIGNATURES Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, the undersigned has duly caused this Form 10-QSB to be signed on its behalf by the undersigned, there unto duly authorized, in the City of West Palm Beach, Florida, on March 9, 2004. AMERICAN CAPITAL PARTNERS LIMITED, INC.
By: /s/ C. Frank Speight Date: March 18, 2004 --------------------- C. Frank Speight, Principal Executive Officer
Exhibit 31.1 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule 13a-14(a) and Rule 15d-14 under the Securities Exchange Act of 1934 -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of American Capital Partners Limited, Inc.. (the "Company") for the period ended June 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, C. Frank Speight Principal Executive Officer, pursuant to 18 U.S.C. Sec.1350, as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002, and pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, that: 1. I have reviewed the Report being filed; 2. Based on my knowledge, the 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 the Report; 3. Based on my knowledge, the financial statements, and other financial information included in the Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the period presented in the Report; 4. I and the other certifying officers are responsible for establishing and maintaining disclosure controls and procedures (as such term is defined in paragraph (c) of Rule 13a-14) for the Company and have: i. Designed such disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated subsidiaries, if any, is made known to them by others within those entities, particularly during the period in which the periodic reports are being prepared; ii. Evaluated the effectiveness of the Company's disclosure controls and procedures as of a date within 90 days prior to the filing date of the Report ("Evaluation Date"); and iii. Presented in the Report their conclusions about the effectiveness of the disclosure controls and procedures based on their evaluation as of the Evaluation Date; 5. I and the other certifying officers have disclosed, based on their most recent evaluation, to the Company's auditors and the audit committee of the board of directors (or persons fulfilling the equivalent function): i. All significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company's auditors any material weaknesses in internal controls; and ii. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls; and 6. I and the other certifying officers have indicated in the 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 their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: March 18, 2004 /s/ C. Frank Speight -------------------- C. Frank Speight Principal Executive Officer Exhibit 31.2 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule 13a-14b) and Rule 15d-14(b)(17 CFR 240.15d-14(b)) under the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of American Capital Partners Limited, Inc. (the "Company") for the period ended June 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Randall Goulding, the Company's Principal Financial and Accounting Officer, certify, pursuant to 18 U.S.C. Sec.1350, as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002, and pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, that: 1. I have reviewed the Report being filed; 2. Based on my knowledge, the 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 the Report; 3. Based on my knowledge, the financial statements, and other financial information included in the Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the period presented in the Report; 4. I and the other certifying officers are responsible for establishing and maintaining disclosure controls and procedures (as such term is defined in paragraph (c) of Rule 13a-14) for the Company and have: i. Designed such disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated subsidiaries, if any, is made known to them by others within those entities, particularly during the period in which the periodic reports are being prepared; ii. Evaluated the effectiveness of the Company's disclosure controls and procedures as of a date within 90 days prior to the filing date of the Report ("Evaluation Date"); and iii. Presented in the Report their conclusions about the effectiveness of the disclosure controls and procedures based on their evaluation as of the Evaluation Date; 5. I and the other certifying officers have disclosed, based on their most recent evaluation, to the Company's auditors and the audit committee of the board of directors (or persons fulfilling the equivalent function): i. All significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company's auditors any material weaknesses in internal controls; and ii. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls; and 6. I and the other certifying officers have indicated in the 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 their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: March 18, 2004 /s/ Randall Goulding -------------------- Randall Goulding Principal Financial and Accounting Officer Exhibit 32.1 Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley act of 2001. -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of American Capital Partners Limited, Inc. (the "Company") for the period ended June 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, C. Frank Speight Principal Executive Officer, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2001, that: The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: March 18, 2004 /s/ C. Frank Speight -------------------- C. Frank Speight Principal Executive Officer Exhibit 32.2 Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley act of 2001. -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of American Capital Partners Limited, Inc. (the "Company") for the period ended June 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Randall Goulding, the Company's Principal Financial and Accounting Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2001, that: The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: March 18, 2004 /s/ Randall Goulding -------------------- Randall Goulding Principal Financial and Accounting Officer -----END PRIVACY-ENHANCED MESSAGE-----