10-Q 1 t23082.txt QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED June 30, 2001 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NO. 000-30331 STRUTHERS, INC. --------------- (Exact name of registrant as specified in its charter) NEVADA 57-1075246 (State or other jurisdiction of (I.R.S. Employer Identification No.) of incorporation or organization) 605 ROSSVILLE ROAD, WAUKON, IOWA 52172 -------------------------------------- (Address of principal executive offices) (563) 568-4950 -------------- (Registrant's telephone number, including area code) (Former name, former address and former fiscal year, if changed since last report) Indicate by checkmark 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. X Yes No --- --- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: As of June 30, 2001, there were 405,327,106 shares of common stock outstanding. As of August 14, 2001 there were 630,999,901 shares of common stock outstanding. PART 1 - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS STRUTHERS, INC. AND SUBSIDIARIES (A NEVADA CORPORATION) WAUKON, IOWA TABLE OF CONTENTS ----------------------------------------------------------------------------- Independent Accountants' Report F-1 Consolidated Balance Sheets at June 30, 2001 (Unaudited) and December 31, 2000 F-2 Consolidated Statements of Changes in Stockholders' Equity for the Six Months Ended June 30, 2000 (Unaudited), December 31, 2000 and the Six Months Ended June 30, 2001 (Unaudited) F-3 Consolidated Statements of Operations for the Three months Ended June 30, 2001 and 2000 (Unaudited) and for the Six Months June 30, 2001 and 2000 (Unaudited) F-4 Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2001 and 2000 (Unaudited) F-5 Notes to the Consolidated Financial Statements (Unaudited) F-6 to F-7 INDEPENDENT ACCOUNTANTS' REPORT To the Board of Directors and Stockholders Struthers, Inc. and Subsidiaries (A Nevada Corporation) WAUKON, IOWA We have reviewed the accompanying consolidated balance sheets of Struthers, Inc. and Subsidiaries as of June 30, 2001, the related consolidated statements of changes in stockholders equity, consolidated statements of operations for the three months and six months ended June 30, 2001 and 2000, and the consolidated statements of cash flows for the six months ended June 30, 2001 and 2000 in accordance with standards established by the American Institute of Certified Public Accountants. All information included in these consolidated financial statements is the responsibility of the Company's management. A review of interim financial information consists principally of inquiries of Company personnel and analytical procedures applied to the financial data. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, 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 consolidated financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America. We have previously audited, in accordance with auditing standards generally accepted in the United States, the consolidated balance sheets of Struthers, Inc. and Subsidiary as of December 31, 2000 and 1999, and the related consolidated statements of operations, changes in stockholders' equity and cash flows for years then ended, and in our report dated February 23, 2001, we expressed an unqualified opinion on those consolidated financial statements. /s/ Rotenberg & Company, LLP Rotenberg & Company, LLP Rochester, New York August 14, 2001 F - 1

The accompanying notes are an integral part of this financial statement. See Accountants Review Report F - 2

The accompanying notes are an integral part of this financial statement. See Accountants Review Report F - 3

The accompanying notes are an integral part of this financial statement. See Accountants Review Report F - 4

The accompanying notes are an integral part of this financial statement. See Accountants Review Report F - 5

The accompanying notes are an integral part of this financial statement. See Accountants Review Report 8 STRUTHERS, INC. AND SUBSIDIARIES (A NEVADA CORPORATION) WAUKON, IOWA NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -(UNAUDITED) -------------------------------------------------------------------------------- NOTE A - BASIS OF PRESENTATION The condensed consolidated financial statements of Struthers, Inc. and Subsidiaries (Struthers) included herein have been prepared by Struthers, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although Struthers believes that the disclosures are adequate so that the information presented is not misleading. These condensed financial statements should be read in conjunction with the annual audited financial statements and the notes thereto included in Struthers annual report on Form 10-K, and other reports filed with the SEC. The accompanying unaudited interim financial statements reflect all adjustments of a normal and recurring nature that are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows of Struthers for the interim periods presented. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year as a whole. Factors that affect the comparability of financial data from year to year and for comparable interim periods include the acquisitions of subsidiaries, and general and administrative costs incurred in connection with raising capital and in registering Struthers common shares with Securities and Exchange Commission. Certain financial information that is not required for interim financial reporting purposes has been omitted. NOTE B - PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of the Company and its subsidiaries, Legred Struthers Genetics, Inc., Elite Visions, Inc., and Muller A.I., Inc. All significant intercompany balances and transactions have been eliminated in consolidation. NOTE C - Other Matters Certain amounts in the prior year financial statements have been reclassified to conform with the current year presentation. Note D - Prior Period Adjustment The accompanying financial statements for the six months ended June 30, 2001 have been restated to correct an overstatement of revenue, cost of sales, and expenses reported in the three months ended March 31, 2001. The effect of the restatement was to reduce previously reported net income by $27,135. This restatement had no effect on retained earnings at December 31, 2000 or June 30, 2001. Note E - Loan Payable During the three months ended June 30, 2001 the company borrowed $190,000 under a promissory note. The note bears interest at 10% per annum and is due in full at the earlier of August 1, 2001 or the date which the company receives the sum in excess of $400,000 under its equity financing agreement with Alpha Venture Capital, Inc. The loan is secured by a leasehold mortgage on property leased by the company in Fairbault County, Minnesota. Note F - Capital Acquisition During the quarter ended June 30, 2001, the company acquired a building in Waukon, Iowa for $300,000 via the assumption of an outstanding mortgage on the property. F-6 F-6 STRUTHERS, INC. AND SUBSIDIARIES (A NEVADA CORPORATION) WAUKON, IOWA NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -(UNAUDITED) -------------------------------------------------------------------------------- Note G - Stock Payable The final installment due in stock under the purchase agreement with Legred Genetics, Inc. and Brent Legred was due May 2, 2001. The installment amount of $1,000,000 was payable in the number of shares equivalents at the fair market value of the common stock on the due date. The final installment was to be reduced by the percentage which net income from semen sales per 100 Boars for the previous 18 months was less than $600,000. The Amount is currently being disputed by the company with the creditor. Note H - Name Change Effective May 24, 2001, the company changed the names of its subsidiaries as follows Struthers Genetics, Inc. formerly known as (FKA) Legred Struthers Genetics, Inc.; Struthers Biotechnologies, Inc FKA Elite Visions, Inc; Struthers A.I., Inc. FKA Muller A.I., Inc. Note I - On July 16, 2001 the Company requested a drawdown of $250,000 under its Equity Financing Agreement with Alpha Venture Capital, Inc. by selling to Alpha Venture Capital, Inc. 6,929,047 common shares. Also, on August 14, 2001, the Company requested an additional $250,000 by selling 6,764,070 shares of common stock to Alpha Venture Capital, Inc. the Company receives the proceeds less a 4% placement fee. F-7 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THIS QUARTERLY REPORT ON FORM 10-Q CONTAINS CERTAIN STATEMENTS OF A FORWARD-LOOKING NATURE RELATING TO FUTURE EVENTS OR THE FUTURE FINANCIAL PERFORMANCE OF STRUTHERS. SUCH STATEMENTS ARE ONLY PREDICTIONS AND THE ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED IN THE FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE THOSE DISCUSSED BELOW AS WELL AS THOSE DISCUSSED IN OTHER FILINGS MADE BY STRUTHERS WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING STRUTHERS ANNUAL AUDITED FINANCIAL STATEMENTS INCLUDED IN ITS ANNUAL REPORT ON FORM 10-K. Overview Struthers business is the sale and marketing of products and services designed to increase reproductive efficiency, animal production and quality in the swine industry utilizing the technology and products it has developed and acquired. Principal sources of revenue are through the sale of gilts (young females that have not given birth to pigs), mature boars, barrows (castrated male hogs), semen, artificial insemination supplies, and genetic and related services including embryo transfer services, embryo transfer equipment and training. Struthers has developed a semen delivery system for use in artificial insemination including the use of the Gourley Scope(TM). Struthers is perfecting the surgical Embryo Transfer System and is currently improving the procedure to include the non-surgical implantation of embryos. Embryo transfer is the ability to remove an embryo from a genetically superior animal and introduce it into a surrogate host (mature recipient female). This has been done successfully, commercially in other large farm animals but has never been successfully commercialized in swine due to the intricate nature of the swine reproductive system. Struthers has included this technology into its overall marketing plans for the year 2001. Struthers new state of the art stud boar facility, located in Bricelyn, Minnesota, houses approximately 200 boars that produce semen for sale. It can house an additional 200 boars. Each boar produces 1,200 doses of semen per year with a retail price per dose of $7.00. At capacity, the facility can produce 480,000 doses of semen per year. Semen sales for the second quarter of 2001 were $87,167 as compared with $63,552 for the second quarter of 2000. Gilt sales (prepubescent breeding sows) are supplied through the Struthers gilt multiplier system. Struthers generates an average of 550 gilt sales per month with an average sales price of $225 per gilt. The Company currently has contracts with several gilt multiplier farms for the production of our superior genetic lines of gilts and barrows. Gilt sales for the second quarter of 2001 were $377,735 as compared with $221,225 for the second quarter of 2000. Boar and barrow (prepubescent boars) sales are also made through the multiplier system or from the core genetic herd. Boar and barrow sales for the second quarter 2001 were $61,763 as compared with $101,830 for the second quarter of 2000. 11 Sales of artificial insemination supplies were $152,473 for the second quarter of 2001 as compared with $65,015 for the second quarter of 2000. The increase in sales of artificial insemination supplies was primarily attributable to the acquisitions of Elite Visions and Muller A.I. during the second quarter of 2000. Sales of genetic and related services were $73,541 for the second quarter of 2001 as compared with $4,761 for the second quarter of 2000. The increase in sales was primarily attributable to the acquisitions of Elite Visions and Muller A.I. during the second quarter of 2000. Struthers acquired the rights to the Gourley Scope, an instrument used for non-surgical semen delivery in animal husbandry including swine, through the acquisition of Elite Visions during the year 2000. Struthers anticipates increases in revenues from the lease of Gourley Scopes and updates, and sales of sheaths and semen during the balance of 2001. 12 The following are selected supplementary data and analysis of the results of operations for the three and six months ended June 30, 2001 and 2000:

13 Results of Operations Three and Six Months Ended June 30, 2001 and 2000. The following table sets forth, for the periods indicated, the percentages of total revenues represented by certain items reflected in Struthers consolidated statements of operations.

14 SIX MONTHS ENDED JUNE 30, 2001 COMPARED WITH THE SIX MONTHS ENDED JUNE 30, 2000 REVENUES Revenues for the six months ended June 30, 2001 were $1,976,274 as compared with $1,783,059 for the six months ended June 30, 2000. Revenues by product line are displayed on the preceding two pages. COST OF SALES The cost of sales for the six months ended June 30, 2001 was $1,786,011 and represented 90.4% of total revenues as compared with $1,179,147 representing 66.1% of total revenues for the six months ended June 30, 2000. The increase in cost of sales as a percentage of total revenues increased as a result of the increased costs to operate the new state-of-the-art stud boar facility. The new stud boar facility began to generate revenues late in the first quarter of 2001. The primary components of cost of sales are the costs to purchase and raise live animals, including feed, veterinary costs, wages, and artificial insemination supplies. RESEARCH AND DEVELOPMENT COSTS Struthers incurred $143,989 in research and development costs, representing 7.3% of total revenues for the six months ended June 30, 2001 as compared with $82,106 representing 4.6% of total revenues for the six months ended June 30, 2000. MARKETING AND ADVERTISING COSTS Marketing and advertising costs for the six months ended June 30, 2001 were $33,499 and represented 1.7% of total revenues as compared with $50,351 representing 2.8% of total revenues for the six months ended June 30, 2000. GENERAL AND ADMINISTRATIVE COSTS General and administrative costs increased by $366,785 from $800,404 for the six months ended June 30, 2000 to $1,167,189 for the six months ended June 30, 2001. The increase in general and administrative costs was attributable primarily to the Struthers efforts in raising capital, restructuring its business activities, acquisition completions, registration of trademarks and patents, other legal and accounting fees, employment related costs, and building its infrastructure to support anticipated growth during 2001. The primary components of general and administrative costs for the six months ended June 30, 2001, and 2000 are as follows: 15

AMORTIZATION AND DEPRECIATION Amortization and depreciation was $718,457 and $494,408 for the six months ended June 30, 2001 and 2000, respectively. The increase was attributed primarily to the inclusion of Elite Visions, Inc. and Muller A. I., Inc. in the second quarter of 2000. OTHER INCOME Other income for the six months ended June 30, 2001 was $7,663 as compared with $38,403 for the six months ended June 30, 2000 and represented interest income on invested cash. PROVISION FOR TAXES Struthers has not had any taxable income since its inception and therefore has not incurred any income taxes. Struthers has not recognized any deferred tax benefits in connection with net operating loss carryforwards and will not until such time as it is more likely than not that the related tax benefits will be realized. 16 THREE MONTHS ENDED JUNE 30, 2001 COMPARED WITH THE THREE MONTHS ENDED JUNE 30, 2000 REVENUES Revenues for the three months ended June 30, 2001 were $1,019,135 as compared with $887,526 for the three months ended June 30, 2000. Revenues by product line have been presented on page 13 and page 14. COST OF SALES The cost of sales for the three months ended June 30, 2001 was $929,702 and represented 91.2% of total revenues as compared with $563,551 representing 63.5% of total revenues for the three months ended June 30, 2000. The increase in cost of sales as a percentage of total revenues increased as a result of the increased costs to operate the new state-of-the-art stud boar facility. The new stud boar facility began to generate revenues late in the first quarter of 2001. The primary components of cost of sales are the costs to purchase and raise live animals, and the farm operations including feed, veterinary costs, wages, and artificial insemination supplies. RESEARCH AND DEVELOPMENT COSTS Struthers incurred $63,543 in research and development costs, representing 6.2% of total revenues for the three months ended June 30, 2001 as compared with $73,474 representing 8.3% of total revenues for the three months ended June 30, 2000. MARKETING AND ADVERTISING COSTS Marketing and advertising costs for the three months ended June 30, 2001 were $12,491 and represented 1.2% of total revenues as compared with $23,006 representing 2.6% of total revenues for the three months ended June 30, 2000. GENERAL AND ADMINISTRATIVE COSTS General and administrative costs decreased by $52,369 from $547,293 for the three months ended June 30, 2000 to $494,924 for the three months ended June 30, 2001. The decrease in general and administrative costs was attributable primarily to the Struthers efforts in raising capital, restructuring its business activities, acquisition completions, registration of trademarks and patents, other legal and accounting fees, employment related costs, and building its infrastructure to support anticipated growth during 2001. The primary components of general and administrative costs for the three months ended June 30, 2001, and 2000 are as follows: 17

AMORTIZATION AND DEPRECIATION Amortization and depreciation was $381,884 and $248,854 for the three months ended June 30, 2001 and 2000, respectively. The increase was attributed primarily to the inclusion of Elite Visions, Inc. and Muller A. I., Inc. in the second quarter of 2000. OTHER INCOME Other income for the three months ended June 30, 2001 was $0 as compared with $36,342 for the three months ended June 30, 2000 and represented interest income on invested cash. PROVISION FOR TAXES Struthers has not had any taxable income since its inception and therefore has not incurred any income taxes. Struthers has not recognized any deferred tax benefits in connection with net operating loss carryforwards and will not until such time as it is more likely than not that the related tax benefits will be realized. EFFECTS OF INFLATION Inflation has not had a material effect on the Struthers revenues and expenses since its inception and inflation is not expected to have a material effect in the future. 18 LIQUIDITY AND CAPITAL RESOURCES Struthers has financed its operations and met its capital requirements including the acquisition of Legred, Elite Visions and Muller A. I., through the sales of equity securities. Cash flows from operations was a negative $1,310,205 for the six months of operations ended June 30, 2001 as compared with a negative $867,799 cash flows from operations for the six months ended June 30, 2000. The increase in the negative cash flows during the second quarter of 2001 was due primarily to increases in accounts receivable and prepaid expenses of approximately $299,376 and $36,739, respectively and reductions in accounts payable of approximately $144,985. Cash used in investing activities for acquisitions of property and equipment was $251,274 and $1,103,903 for the six months ended June 30, 2001 and 200, respectively. The net cash provided by financing activities of $234,009 for the six months ended June 30, 2001 was from the proceeds of debt. Cash provided by financing activities for the six months ended June 30, 2000 was $5,599,787 and represented approximately $6,500,000 in proceeds from the issuance of preferred stock less a $900,213 cash payment on a note to Brent Legred in connection with the Legred acquisition. As of June 30, 2001, Struthers had net working capital of $1,150,070. Struthers primary source of liquidity at June 30, 2001 was $118,966 in cash and cash equivalents, $829,231 in trade accounts receivable and $548,011 in inventories. Struthers may, in the future, pursue additional acquisitions of businesses, products and technologies, or enter into joint venture arrangements, that could complement or expand the Company's business. Any material acquisition or joint venture could result in a decrease to the Company's working capital, depending on the amount, timing and nature of the consideration to be paid. The Company has not completed any negotiations for any significant acquisitions, joint ventures or mergers at the present time that have not been disclosed. In order to provide a possible source of funding for Struthers current activities and for the continued development of its current and planned products, and markets for its products, on March 23, 2001, Struthers entered into a Common Stock Purchase Agreement and Registration Rights Agreement, commonly referred to as an equity line of credit agreement, with Alpha Venture Capital, Inc. Struthers does not have any material commitments for capital expenditures during the next 12 months other than those disclosed herein. Struthers intends to use its existing cash and cash equivalent balances as of June 30, 2001 to fund its operations and research and development activities. In addition, Struthers may avail itself of the proceeds from the sale of its common stock under the equity line of credit agreement with Alpha Venture Capital, Inc. for up to $10,000,000. Management believes that this will satisfy Struthers operating working capital needs and capital expenditure requirements for at least the next 12 months. Struthers may consider various alternatives for obtaining additional equity or debt financing should the need occur. Any material acquisitions of complementary businesses, products, services or technologies could require Struthers to obtain such financing. There can be no guarantee that such financing will be available on acceptable terms, if at all. 19 Item 3. Quantitative and Qualitative Disclosures About Market Risk. Interest Rates Struthers invests its cash in short-term variable rate money market accounts and demand deposits. Struthers only borrowings are fixed rate mortgages and notes payable. Struthers operations are not materially affected by changes in interest rates 20 PART II - OTHER INFORMATION Item 1. Legal Proceedings. None Item 2. Changes in Securities and Use of Proceeds. None Item 3. Defaults Upon Senior Securities. None Item 4. Submission of Matters to a Vote of Security Holders. None Item 5. Other Information. None Item 6. Exhibits and Reports on Form 8-K. ITEM 16. EXHIBITS (a) Exhibits EXHIBIT NO. DESCRIPTION ----------- ----------- 3.1 *Articles of Incorporation of Latitude Network Inc. 3.2 *Amended Articles of Incorporation of Latitude Network, Inc. 3.3 *Amended Articles of Incorporation of Orbis Development, Inc. 3.4 *Amended Articles of Incorporation of Struthers, Inc. 3.5 *Certificate of Correction of Amended Articles of Incorporation of Struthers, Inc. 3.6 *Amended Articles of Incorporation of Struthers, Inc. 3.7 *By-Laws of Struthers, Inc. 4 See Exhibit 3.4, 3.5, 3.6 filed herewith for rights of security holders. 4.1 **REGISTRATION RIGHTS AGREEMENT BETWEEN STRUTHERS, INC. AND ALPHA VENTURE CAPITAL, INC. DATED MARCH , 2001 4.2 **Warrant Agreement ("A" Warrants) between Struthers, Inc. and Alpha Venture Capital, Inc. dated March , 2001 4.3 **Warrant Agreement ("B" Warrants) between Struthers, Inc. and Alpha Venture Capital, Inc. dated March , 2001 5 **Opinion of Richard S. Lane, Esq. 21 9 *Voting Trust Agreement 10.1 *Agreement dated November 2, 1999 among Struthers, Inc., Legred Genetics, Inc., Legred Genetics, and Brent Legred (with exhibits). 10.2 *Assignment and Assumption of Lease between Struthers, Inc. and Legred Struthers Genetics, Inc. 10.3 *Employment Agreement with Douglas W. Beatty. 10.4 *Employment Agreement with Rhett Seabrook. 10.5 *Employment Agreement with Bertram K. Remley. 10.6 *Employment Agreement with Brent Legred. 10.7 **Common Stock Purchase Agreement between Struthers, Inc. and Alpha Venture Capital, Inc. dated March 23, 2001 10.8 **Registration Rights Agreement between Struthers, Inc. and Alpha Venture Capital, Inc. dated March 23, 2001 10.9 **Escrow Agreement between Struthers, Inc. and Dundee Securities Corporation as Escrow Agent for Alpha Venture Capital, Inc. dated March 23, 2001 21.1 *Articles of Incorporation of Legred Struthers Genetics, Inc., a subsidiary of Registrant. 21.2 *Amended Articles of Incorporation of Legred Struthers Genetics, Inc. 21.3 *Articles of Incorporation of Elite Visions, Inc. 21.4 *Articles of Incorporation of Muller A. I., Inc. 21.5 Amended Articles of Incorporation of Legred Struthers, Inc. 21.6 Amended Articles of Incorporation of Elite Visions, Inc. 21.7 Amended Articles of Incorporation of Muller A.I., Inc. 21.5 ***Amended Articles of Incorporation of Legred Struthers Genetics, Inc. 21.6 ***Amended Articles of Incorporation of Elite Visions, Inc. 21.7 ***Amended Articles of Incorporation of Muller A.I., Inc. 23.1 **Consent of Richard S. Lane, Esq. 23.2 **Consent of Rotenberg & Company, LLP * Incorporated by reference to the same exhibit filed with Struthers registration statement on Form 10 as filed on October 25, 2000 ** Incorporated by reference to the same exhibit filed with Struthers registration statement on Form S-1 as filed on June 11, 2001 *** Filed herewith. (b) Reports on Form 8-K On April 12, 2001, Struthers filed a report on Form S-1, which reported under Item 5 the following actions: Following a meeting of the Board of Directors held on March 30, 2001 Douglas W. Beatty thereupon ceased acting as a member of the Board of Directors and Rhett Seabrook thereupon ceased acting both as a member of the Board of Directors and as Vice President. On March 26, 2001, Struthers filed a report on Form 8-K, which reported under Item 5 the following actions: 22 o The Board of Directors approved the appointment of Dr. Allan Carlson, Dr. Dennis D. Gourley and Richard S. Lane, Esq. as Directors of the Company to fill three vacancies effective January 1, 2001. o At a meeting on March 19, 2001, the following persons were appointed as officers: Mariano Raigo - President Dr. Dennis D. Gourley - Secreatary/Treasurer Richard S. Lane, Esq. - Chairman of the Board Rhett Seabrook - Vice President o Accordingly, effective as of March 19, 2001 Douglas W. Beatty ceased acting as CEO/President and Chairman of the Board and Rhett Seabrook, who was appointed Vice President, ceased acting as Secretary/COO. SIGNATURES Pursuant to the requirements 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. August 9, 2001 STRUTHERS, INC. BY /S/ RICHARD S. LANE Richard S. Lane, Chairman of the Board BY /S/ MARIANO M. RAIGO Mariano M. Raigo, President 23

STRUTHERS INC/SC 10-Q