-----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, LqVsr8kZShlRhCuVxgYXke+trUmYlXU/9FrQN1o7jmEPtmrHXNc7UyqaBYGvo2Ng 3/Le742RjUZuUnxOOxONQg== 0000890725-99-000006.txt : 19991103 0000890725-99-000006.hdr.sgml : 19991103 ACCESSION NUMBER: 0000890725-99-000006 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19991102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DEVELOPED TECHNOLOGY RESOURCE INC CENTRAL INDEX KEY: 0000890725 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-ELECTRICAL APPARATUS & EQUIPMENT, WIRING SUPPLIES [5063] IRS NUMBER: 411713474 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-21394 FILM NUMBER: 99739408 BUSINESS ADDRESS: STREET 1: 7300 METRO BLVD SUITE 550 CITY: EDNA STATE: MN ZIP: 55439 BUSINESS PHONE: 6128200755 MAIL ADDRESS: STREET 1: 7300 METRO BLVD SUITE 550 STREET 2: SUITE 170 CITY: EDNA STATE: MN ZIP: 55439 10QSB 1 19 FORM 10-QSB U.S. Securities and Exchange Commission Washington, D.C. 20549 [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to __________ Commission File Number: 0-21394 Developed Technology Resource, Inc. (Exact name of issuer as specified in its charter) Minnesota 41-1713474 State of Incorporation I.R.S. Employer Identification No. 7300 Metro Boulevard, Suite 550 Edina, Minnesota 55439 Address of Principal Executive Office (612) 820-0022 Issuer's Telephone Number Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 As of October 29, 1999, there were 805,820 shares of the issuer's Common Stock, $0.01 par value per share, outstanding. DEVELOPED TECHNOLOGY RESOURCE, INC. INDEX For the Quarter Ended March 31, 1999 Page No. PART I. FINANCIAL INFORMATION Item 1. Condensed Unaudited Financial Statements Condensed Balance Sheets 3 Condensed Statements of Operations 4 Condensed Statements of Cash Flows 5 Notes to Condensed Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10 PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Shareholders 13 Item 6. Exhibits and Reports on Form 8-K 13 SIGNATURES 17 ITEM 1. CONDENSED UNAUDITED FINANCIAL STATEMENTS DEVELOPED TECHNOLOGY RESOURCE, INC. CONDENSED BALANCE SHEETS (Unaudited)
ASSETS March 31, December 31, 1999 1998 Current Assets: Cash and cash equivalents $ 25,598 $ 5,412 Receivables: Trade, net 50,569 129,169 Sale of discontinued operations 200,000 200,000 FoodMaster International LLC(FMI) 495,854 611,080 Other 16,000 4,000 Note receivable 600,000 600,000 Prepaid and other current assets 184,090 158,798 Total current assets 1,572,111 1,708,459 Furniture and Equipment, net 39,669 43,794 Investment in FMI 996,786 991,699 $2,608,566 $2,743,952 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 161,266 $ 241,458 Accrued liabilities 96,762 163,761 Deferred gain short-term 187,065 187,065 Total current liabilities 445,093 592,284 Non-current Deferred Gain 32,305 33,627 Total liabilities 477,398 625,911 Commitments and Contingencies -- -- Shareholders' Equity: Common stock 8,058 8,058 Additional paid-in capital 6,114,920 5,956,323 Accumulated deficit (3,991,810) (3,846,340) Total shareholders' equity 2,131,168 2,118,041 $2,608,566 $2,743,952
See accompanying notes to the condensed financial statements. DEVELOPED TECHNOLOGY RESOURCE, INC. CONDENSED STATEMENTS OF OPERATIONS Three Months Ended March 31, 1999 and 1998 (Unaudited)
1999 1998 Revenues: Sales $ 48,900 $ 24,818 Management fees from FMI joint venture 313,210 293,832 Commissions and other income 1,322 1,322 363,432 319,972 Cost and Expenses: Cost of sales 41,450 19,100 Selling, general and administrative 324,888 320,529 366,338 339,629 Operating Loss (2,906) (19,657) Other Income(Loss): Interest income, net 10,946 77,983 Equity in (loss)earnings of FMI joint venture (153,510) 42,373 Net Income (Loss) $(145,470) $ 100,699 Net Income (Loss) per Common Share: Basic $ (0.18) $ 0.13 Diluted $ (0.18) $ 0.09
See accompanying notes to the condensed financial statements. DEVELOPED TECHNOLOGY RESOURCE, INC. CONDENSED STATEMENTS OF CASH FLOWS Three Months Ended March 31, 1999 and 1998 (Unaudited)
1999 1998 OPERATING ACTIVITIES: Net Income (Loss) $ (145,470) $ 100,699 Adjustments to Reconcile Net Income (Loss) to Cash Provided(Used) by Operating Activities: Depreciation 2,811 4,385 Loss on sale of furniture and equipment -- -- Equity in loss(earnings) of FMI joint venture 153,510 (42,373) Changes in Operating Assets and Liabilities: Receivables 66,600 60,218 Receivable from FMI joint venture 115,226 (24,117) Prepaid and other current assets (25,292) (93,211) Accounts payable and accrued liabilities (147,191) (207,111) Deferred gains (1,322) (1,322) Net cash provided(used) by operating activities 18,872 (202,832) INVESTING ACTIVITIES: Proceeds from sale of furniture and equipment 1,740 -- Purchases of furniture and equipment (426) (15,015) Net cash provided(used) by investing activities 1,314 (15,015) FINANCING ACTIVITIES: Proceeds from exercise of stock options -- 22,500 Net cash provided by financing activities -- 22,500 INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS 20,186 (195,347) CASH AND CASH EQUIVALENTS, Beginning of Period 5,412 284,526 CASH AND CASH EQUIVALENTS, End of Period $ 25,598 $ 89,179
See accompanying notes to the condensed financial statements. DEVELOPED TECHNOLOGY RESOURCE, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS 1. Summary of Significant Accounting Policies Business Developed Technology Resource, Inc. (DTR or the Company) invests in and manages dairy and distribution operations in three countries of the former Soviet Union (fSU) through FoodMaster International L.L.C. (FMI), its joint venture with Agribusiness Partners International L.P. (API). In addition to managing FMI, DTR sells packaging equipment and manages the operations of its 100% owned subsidiary, SXD, Inc. During 1998, SXD, Inc. distributed X-ray tubes under DTR's exclusive agreement with a Russian manufacturer, issued unsecured short-term loans, and held ownership interests in the coatings technology business of Phygen, Inc. and the cancer detection business of Armed which had no reportable business activity during 1999 or 1998. The x-ray tube distribution agreement expired in March 1999 and the Company is phasing out this operation during 1999. Basis of Presentation The interim financial statements of Developed Technology Resource, Inc. (DTR) are unaudited, but in the opinion of management, reflect all necessary adjustments for a fair presentation of the financial position, as well as, the results of operations and cash flows for the periods presented. The results of operations for any interim period are not necessarily indicative of results for the full year. These financial statements should be read in conjunction with the Company's Annual Report and Notes thereto on Form 10-KSB for the year ended December 31, 1998 as filed with the Securities and Exchange Commission. Going Concern Considerations Since August 1998, the countries of the fSU, in which the subsidiaries of FMI operate, have faced a series of adverse economic conditions. Uncertainties regarding the political, legal, tax or regulatory environment, including the potential for adverse and retroactive changes in any of these areas could significantly affect the Company. These countries have had a significant devaluation of their local currency against the US dollar, higher interest rates and reduced opportunities for financing. As a result of these situations, several of the subsidiaries have suffered significant losses in 1998 and 1999 from foreign currency translation losses as a result of hyperinflationary accounting for foreign currency translation. As a result, several of these subsidiaries carry an accumulated deficit at March 31, 1999. DTR is committed to working with FMI's subsidiaries to focus production on profitable products and to address working capital shortages as needed over the coming year. Working capital shortages will be funded through loans from FMI, loans from third parties or through the sale of equity. The year 2000 (Y2k) issue arises because many computerized systems use two digits rather than four to identify a year. Date sensitive systems may recognize the year 2000 as 1900 or some other date, resulting in errors when information using the Y2k date is processed. The effects of the Y2k issue may be experienced before, on, or after January 1, 2000 and if not addressed, the impact on operations and financial reporting may range from minor errors to significant systems failure which could affect an entity's ability to conduct normal business operations. It is not possible to be certain that all aspects of the Y2k issue affecting the Company, including those relating to the efforts of customers, suppliers, or other third parties, will be fully resolved. DTR completed its Y2k review on its own operations in June 1999. At this time, all systems were completely Y2k compliant. Due to the nature of the FMI subsidiaries' equipment and the upgrading of their computerized systems by November 1999, no serious interruptions in production or financial processing are expected. The direct risks to the Company, and in particular, the FMI subsidiaries are those resulting from the general economic environment, government, and relationships with suppliers and customers in the fSU. Several governments in the fSU in which the FMI subsidiaries operate have indicated that the national infrastructure of such countries will not be Y2k compliant by January 1, 2000. As such, the FMI subsidiaries have made contingency plans that include back-up electric generators and manual processing of transactions, among other things. 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 at the date of the financial statements and reported amounts of revenues and expense during the reporting period. Actual results could differ from those estimates. Reclassifications Certain reclassifications were made to the 1998 financial statements to present those financial statements on a basis comparable with the current year. The reclassifications had no effect on previously reported net loss or accumulated deficit. 2. Ak-Bulak Option Effective August 1996, the Company obtained an option to purchase 80% of Ak-Bulak, an inactive company which owned the other 50% of the FoodMaster joint venture. To exercise the option, the Company agreed to pay certain pre-defined outstanding debts of Ak-Bulak and to make capital improvements to the dairy owned by FoodMaster. As of March 2, 1997, DTR had paid $171,774 in connection with the exercise of this option. On March 3, 1997, DTR contributed its 50% ownership in FoodMaster along with this option to the FMI joint venture. FMI repaid DTR for all but $14,045 of the costs paid through March 2, 1997 to exercise the option (See Note 3). 3.Investment in FoodMaster International L.L.C. (FMI) On March 3, 1997, DTR and API established the FMI joint venture to acquire and operate dairies in the fSU. For a 40% interest in FMI, DTR contributed its 50% ownership in FoodMaster, the Ak-Bulak option (See Note 2), and its opportunities for a future acquisition of a dairy in Moldova. Exercise of the Ak-Bulak option by FMI in March 1997 increased the ownership in FoodMaster to 90%. API agreed to contribute $6 million dollars which was paid to FMI between March 1997 and June 1998 to further develop FMI's existing and future dairy operations in the fSU for a 60% interest in FMI. On September 11, 1998, DTR and API amended the FMI joint venture agreement to allow API to contribute up to an additional $6 million dollars for an additional 10% ownership. This additional contribution was paid to FMI between September 1998 and April 1999. As of December 31, 1998, API owned 67% and DTR owned 33% of FMI based on API's additional investment of $3.8 million. API contributed the remaining $2.2 million of the additional investment by April 1999 which reduced DTR's ownership to 30%. The investment proceeds received by FMI were used to fund expansion of existing facilities and to acquire four additional subsidiaries. DTR has a right to earn a greater ownership interest in FMI by achieving certain defined performance targets based on returns to API. Effective March 1997, DTR records its proportionate share (40% from March 1997 to September 1998 and 33% from October 1998 to December 1998 and 30% thereafter) of the net loss or income of FMI in the statement of operations as equity in (loss) earnings of FMI joint venture under the equity method of accounting. DTR also entered into a management agreement on March 3, 1997 with FMI, whereby DTR manages the day to day operations of FMI and the dairy operations owned by FMI, and pursues future dairy acquisitions for FMI for a management fee. The management fee is a direct expense reimbursement, with no profit margin, in accordance with a pre-approved budget between DTR and FMI. Thus, management fees will increase or decrease as DTR's expenses incurred for management activities increase or decrease, with no effect on income because there is no profit margin provided for in the agreement. There is no stated contractual termination date in this agreement. The Company recorded management fee revenue of $313,210 and $293,832 for the three months ended March 31, 1999 and 1998, respectively, in accordance with its management agreement with FMI. Summarized financial information from the unaudited financial statements of FMI accounted for on the equity method is as follows: March 31,1999 Current assets $7,034,805 Total assets 21,137,325 Current liabilities 4,461,346 Noncurrent liabilities 3,956,151 Joint-venture equity 12,719,827 DTR's 30% share of FMI 's equity 3,815,948 DTR's negative goodwill (amortized over 15 years) (2,819,162) DTR's carrying value of FMI's equity 996,786 Three Months Ended March 31, 1999 1998 Sales $ 5,751,012 $ 3,600,000 Gross profit 786,069 156,000 Net loss (693,584) (30,480) DTR's share of FMI's loss before amortization of DTR's negative goodwill (208,075) (12,192) DTR's share of equity in income(loss) of FMI joint venture after amortization of negative goodwill (153,510) 42,373 4.Net Income (Loss) per Common Share The following table reflects the calculation of basic and diluted earnings per share. Three Months Ended March 31, 1999 1998 Basic Earnings Per Common Share: Net income(loss) $ (145,470) $ 100,699 Average shares outstanding 805,820 804,987 Basic EPS on net income $ (0.18) $ 0.13 Diluted Earnings Per Common Share: Net income(loss) $ (145,470) $ 100,699 Average shares outstanding 805,820 804,987 Stock options -- 329,211 Total 805,820 1,134,198 Diluted EPS on net income $ (0.18) $ 0.09 An aggregate of 663,333 and 18,333 options to acquire the Company's common stock at March 31, 1999 and 1998, respectively, have been excluded from the calculation of diluted earnings per share as their effect would be antidilutive. 5. Supplemental Disclosures of Cash Flow Information: Non-cash operating and investing activities: In September 1998, API began its purchase of an additional 10% of FMI for $6 million dollars as discussed in Note 3. For the three months ended March 31, 1999, they contributed $1.7 million to FMI resulting in a $158,597 increase in the value of DTR's investment in FMI in order to recognize the unrealized gain from the reduction in its ownership interest in FMI. The API capital contribution to FMI also increased DTR's paid-in-capital by this same amount through March 1999. Supplemental cash flow information: For the three months ended March 31, 1999 1998 Cash paid for: Interest $ 1,056 $ 128 Taxes $ -- $ -- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations Statements other than current or historical information included in this Management's Discussion and Analysis and elsewhere in this Form 10-KSB, in future filings by Developed Technology Resource, Inc. (the Company or DTR) with the Securities and Exchange Commission and in DTR's press releases and oral statements made with the approval of authorized executive officers, should be considered "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. DTR wishes to caution the reader not to place undue reliance on any such forward-looking statements. On March 3, 1997, DTR and Agribusiness Partners International L.P. (API) established the FoodMaster International LLC (FMI) joint venture to acquire and operate dairies in the fSU. For a 40% interest in FMI, DTR contributed its 50% ownership in FoodMaster, the Ak-Bulak option, and its opportunities for a future acquisition of a dairy in Moldova. Exercise of the Ak- Bulak option by FMI in March 1997 increased the ownership in FoodMaster to 90%. API agreed to contribute $6 million dollars which was paid to FMI between March 1997 and June 1998 to further develop FMI's existing and future dairy operations in the fSU for a 60% interest in FMI. On September 11, 1998, DTR and API amended the FMI joint venture agreement to allow API to contribute up to an additional $6 million dollars for an additional 10% ownership. This additional contribution was paid to FMI between September 1998 and April 1999. As of December 31, 1998, API owned 67% and DTR owned 33% of FMI based on API's additional investment of $3.8 million. API contributed the remaining $2.2 million of the additional investment by April 1999 which reduced DTR's ownership to 30%. The investment proceeds received by FMI were used to fund expansion of existing facilities and to acquire four additional subsidiaries. DTR has a right to earn a greater ownership interest in FMI by achieving certain defined performance targets based on returns to API. Effective March 1997, DTR records its proportionate share (40% from March 1997 to September 1998, 33% from October 1998 to December 1998 and 30% thereafter) of the net income or loss of FMI in the statement of operations as equity in (loss) earnings of FMI joint venture under the equity method of accounting. DTR also entered into a management agreement on March 3, 1997 with FMI, whereby DTR manages the day to day operations of FMI, manages the subsidiaries of FMI, and pursues future dairy acquisitions for FMI for a management fee. The management fee is a direct expense reimbursement, with no profit margin, in accordance with a pre-approved budget between DTR and FMI. Thus, management fees will increase or decrease as DTR's expenses incurred for management activities increase or decrease, with no effect on income because there is no profit margin provided for in the agreement. There is no stated contractual termination date in this agreement. Revenues The Company generated total revenues of $363,432 in the first quarter of 1999, compared to $319,972 in the first quarter of 1998. This 13.6% increase in revenues is the result of a $19,378 increase in management fees and a $26,700 increase in x- ray tube sales in the first quarter of 1999 compared to the same period in 1998. Sales for the three months ended March 31, 1999 and 1998 totaled $48,900 and $24,818, respectively. Sales resulted from two areas within DTR - equipment sales and x-ray tube sales. Sales of and commissions on food packaging equipment were $2,618 (10.5%) of total sales in the quarter ended March 31, 1998. There were no sales of equipment in the first quarter of 1999. Sales of equipment occur sporadically throughout the year. They occur primarily to subsidiaries of FMI throughout each year depending on the amount of new customers and growth among existing locations. There are no commitments to purchase nor are there efforts to sell this packaging equipment. Sales are only conducted on an as-needed basis. Sales of x-ray tubes by SXD Inc., DTR's 100% owned subsidiary, increased to $48,900 in the first quarter of 1999 from $22,200 in the first quarter of 1998. The increase occurred due to the timing and quantity of orders in the first quarter of fiscal 1999. There are several companies that manufacture and sell x-ray tubes in direct competition to DTR. At present, the Company does not have a measurable market share and began phasing this division out of its operations in January 1999. In accordance with its plan to phase out this operating division, the Company ended its relationship with its supplier, Svetlana Rentgen, in March 1999. Cost of Sales The only cost of sales at March 31, 1999 and 1998 related to the cost on x-ray tubes. The cost of $41,450 and $19,100 in the first quarter of 1999 and 1998, respectively provided a gross profit on x-ray tubes sales of 15.2% and 14%, respectively. The gross profit has remained consistent over the past few years, but the increase in competition put pressure on the Company to lower its prices to a level that would not be worth continuing this division. Therefore, the Company did not renew its sales contracts with its customers after March 1999. Selling, general and administrative Selling, general and administrative expenses for the three months ended March 31, 1999 were $324,888 compared to $320,529 for the three months ended March 31, 1998. The majority of these costs are offset by the management fee income of $313,210 and $293,832 for the three months ended March 31, 1999 and 1998, respectively. These management fees are charged to FMI as discussed above under Revenues. Liquidity and Capital Resources Operating Activities DTR received cash from operating activities in the amount of $18,872 in the first quarter of 1999 compared to cash used of $202,832 in the first quarter 1998. The increase in cash between the first quarter of 1999 compared to the same period in 1998 resulted primarily from FMI's payment of DTR's management fees. Investing Activities In the first quarter of 1999, DTR sold $2,380 of equipment at its net book value of $1,740 to FMI. In addition, they purchased $426 of equipment. In the first quarter of 1998, the Company purchased equipment totaling $15,015. Financing Activities There were no financing activities during the three months ended March 31, 1999. In the first quarter of 1998, 15,000 options to purchase DTR's Common Stock were exercised for a purchase price of $1.50 per share. Year 2000 The Company has been addressing Year 2000 (Y2k) issues. Since the Company is not a direct manufacturer of products and since all of its assets are less than six years old, most of its exposure to the Y2k issue falls in the area of third parties. According to its review in June 1999, all of the Company's systems are Y2k compliant. The Company does not believe that the costs related to the Y2k issue will be greater than $5,000 due to the reasons stated above. The most risk that the Company faces in its operations is that of the failure of third-party vendors to be ready for the Y2k. The most direct risk could be a failure on the part of telecommunication companies, which would impede the daily communication between the Company and its subsidiaries. Indirectly, the subsidiaries could experience a failure to receive timely shipments of supplies which would result in a loss of an indeterminable amount of revenues. As of November 1999, the Company has its contingency plan for the aforementioned risks prepared and ready to implement by January 1, 2000. Due to the nature of the FMI subsidiaries' equipment and the upgrading of their computerized systems by November 1999, no serious interruptions in production or financial processing are expected. The direct risks to the Company, and in particular, the FMI subsidiaries are those resulting from the general economic environment, government, and relationships with suppliers and customers in the fSU. Several governments in the fSU in which the FMI subsidiaries operate have indicated that the national infrastructure of such countries will not be Y2k compliant by January 1, 2000. As such, the FMI subsidiaries have made contingency plans that include back-up electric generators and manual processing of transactions, among other things. Adverse Foreign Economic and Currency Conditions Since August 1998, the countries of the fSU in which the subsidiaries of FMI operate have faced a series of adverse economic conditions. Uncertainties regarding the political, legal, tax or regulatory environment, including the potential for adverse and retroactive changes in any of these areas could significantly affect the Company and the carrying value of its investment in the FMI joint venture. The countries have seen a significant devaluation of their local currency against the US dollar, higher interest rates and reduced opportunities for financing. DTR is committed to working with FMI's subsidiaries to focus production on profitable products and to address working capital shortages as needed over the coming year. In July 1999, FMI sold 10% of its consolidated Kazakhstan operations for cash of $1.8 million and it converted $1.8 million of its loans to the Kazakhstan subsidiaries to equity so that its ownership would not be dramatically diluted. This cash infusion was used to pay DTR's management fees in 1999. Further working capital shortages will be funded through loans from FMI, loans from third parties or through the sale of additional equity. Based on management's current projections for FMI and the receipt of the $6 million additional investment from API into FMI, the Company believes that the carrying value of its investment in FMI at December 31, 1998 is not permanently impaired and that DTR has sufficient working capital and liquidity to fund its current operations through the coming year. Management is continually looking for opportunities for growth. PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of the shareholders during the quarter ended March 31,1999. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K The following new Exhibits are filed as part of this Form 10-QSB: (a) List of Exhibits 27 Financial Data Schedule (b) Reports on Form 8-K There were no reports on Form 8-K filed by Developed Technology Resource, Inc. during the quarter ended March 31, 1999. EXHIBIT INDEX The following Exhibits are filed as part of this Form 10-QSB: No. Exhibit Description 3.1 Articles of Incorporation of the Company dated November 11, 1991(1) 3.2 Certificate of Amendment of Articles of Incorporation of the Company dated June 16, 1992(1) 3.3 Bylaws of the Company(1) 3.4 Certificate of Amendment of Articles of Incorporation of the Company, changing registered office address dated March 2, 1993(1) 3.5 Certificate of Amendment of Articles of Incorporation of the Company dated November 30, 1995(3) 4.1 Form of stock certificate representing Common Stock, $.01 par value per share, of the Company, issued by Company after a 1 for 3 reverse split effective December 12, 1995(3) 4.2 Form of Subscription Agreement and Investment Representations in connection with private placement of 300,000 shares of Common Stock(1) 4.3 Amended Incentive Stock Option Grant - Erlan Sagadiev dated December 11, 1996(6) 4.4 Amended Incentive Stock Option Grant - John Hupp dated December 11, 1996(6) 10.1 Asset Sale Agreement between Company and a corporation to be organized by Oleg Yermakov selling the Company's security equipment distribution business and certain assets to Oleg Yermakov, contingent on certain future events(5) 10.2 Exclusive Distributor Agreement dated October 1995 between Company and SECTOR 6, Security Division of N.V. COMAUTO S.A. effective until September 30, 1998(5) 10.3 Contract for Fiduciary Management of State Shares of the Open Type Joint Stock Company, Ak-Bulak with their Subsequent Buy-out Option (4) 10.4 1992 Stock Option Plan as amended and restated effective September 30, 1996(8) 10.5 Form of Stock Option Agreement(1) 10.6 Limited Liability Company Agreement of FoodMaster International L.L.C. as amended and restated September 11, 1998(9) 10.7 FoodMaster International L.L.C. Share Transfer Agreement dated March 3, 1997(6) 10.8 FoodMaster International L.L.C. Bill of Sale, Assignment and Assumption Agreement dated March 3, 1997(6) 10.9 Management Agreement between DTR and FoodMaster International L.L.C. as amended and restated September 11, 1998(9) 10.12 Form of Assignment of Financial Advisory Agreement from the Company to FAI Limited Partnership effective January 31, 1993(1) 10.13 Employment Agreement between DTR and Erlan Sagadiev effective September 30, 1996(6) 10.14 Employment Agreement between DTR and John Hupp effective October 1, 1998 as amended and restated(9) 10.15 Developed Technology Resource, Inc. 1993 Outside Directors Stock Option Plan effective December 17, 1993(2) 10.16 Office Lease between DTR and McNeil Real Estate dated March 11, 1997 effective until April 30, 2002(8) 10.20 Partnership Agreement dated January 16, 1992 among the Company, Armen P. Sarvazyan and Stanislav Yemelyanov concerning the formation of Medical Biophysics International, as amended by Partnership Agreement Amendment dated August 20, 1992(1) 10.21 Letter of Understanding dated June 18, 1992 between the Company and Armen P. Sarvazyan concerning Medical Biophysics International, and May 22, 1992 letter from the Company to Dr. Armen P. Sarvazyan, Ph.D.(1) 10.22 Assignment of rights to Intracavity Ultrasonic Device for Elasticity Imaging from Armen P. Sarvazyan, Stanislav Emelianov and Andrei R. Skovoroda to Medical Biophysics International dated December 19, 1992(1) 10.23 Assignment of rights to Method and Apparatus for Elasticity Imaging from Armen P. Sarvazyan and Stanislav Emelianov to Medical Biophysics International dated December 19, 1992(1) 10.24 Assignment of rights to Method and Device for Mechanical Tomography of Tissue from Armen P. Sarvazyan to Medial Biophysics International dated January 16, 1993(1) 10.42 Form of Underwriter's Warrants dated May 5, 1993 between the Company and Equity Securities Trading Co., Inc.(2) 10.43 Form of Directors and Officers Indemnification Agreement issued to each of the Company's officers and directors on October 15, 1993 by action of the Board of Directors(2) 10.44 Developed Technology Resource, Inc. 1997 Outside Directors Stock Option Plan effective November 1, 1997(7) 10.45 Amendment to Asset Sale Agreement (Exhibit 10.1) dated August 20, 1997 (7) 21.1 Subsidiaries of Developed Technology Resource, Inc. as amended(10) 27 Financial Data Schedule(11) (1)Incorporated by reference to the same exhibit number included in the Company's registration statement on Form SB-2, as Amended, filed with the Commission as file number 33-58626C in 1993. (2)Incorporated by reference to the same exhibit number included in the Company's Annual Report on Form 10-KSB filed with the Commission for the fiscal year ended October 31, 1993. (3)Incorporated by reference to exhibit numbers 1A and 3A included in the Company's Form 8-A/A filed with the Commission on December 12, 1995. (4)Incorporated by reference to exhibit number 10 included in the Company's Quarterly Report on Form 10-QSB for the third fiscal quarter ended July 31, 1996. (5)Incorporated by reference to the same exhibit number included in the Company's Annual Report on Form 10-KSB filed with the Commission for the fiscal year ended October 31, 1995. (6)Incorporated by reference to exhibit numbers 4.1, 4.2, 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6 included in the Company's Quarterly Report on Form 10-QSB filed with the Commission for the first fiscal quarter ended January 31, 1997. (7)Incorporated by reference to the same exhibit number included in the Company's Annual Report on Form 10-KSB filed with the Commission for the fiscal year ended October 31, 1997. (8)Incorporated by reference to the same exhibit number included in the Company's Quarterly Report on Form 10-QSB filed with the Commission for the first fiscal quarter ended January 31, 1998. (9)Incorporated by reference to the same exhibit number included in the Company's Quarterly Report on Form 10-QSB filed with the Commission for the third calendar quarter ended September 30, 1998. (10) Incorporated by reference to the same exhibit number included in the Company's Annual Report on Form 10-KSB filed with the Commission for the calendar year ended December 31, 1998. (11) Filed herewith. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DEVELOPED TECHNOLOGY RESOURCE, INC. Date: November 1, 1999 By /s/ John P. Hupp_______ Name: John P. Hupp Title: President Date: November 1, 1999 By /s/ LeAnn H. Davis_____ Name: LeAnn H. Davis, CPA Title: Chief Financial Officer (Principal Financial & Accounting Officer) EX-27 2
5 3-MOS DEC-31-1999 MAR-31-1999 25,598 0 63,259 (12,690) 0 1,572,111 134,033 (94,364) 2,608,566 445,093 0 0 0 8,058 2,123,110 2,608,566 48,900 363,432 41,450 366,338 153,510 0 (10,946) (145,470) 0 (145,470) 0 0 0 (145,470) (0.18) (0.18)
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