Pro-Tech Industries, Inc. - FORM 10-K

Attached files

file	filename
EX-21 - Pro-Tech Industries, Inc.	v181177_ex21.htm
EX-31.1 - Pro-Tech Industries, Inc.	v181177_ex31-1.htm
EX-32.1 - Pro-Tech Industries, Inc.	v181177_ex32-1.htm
EX-31.2 - Pro-Tech Industries, Inc.	v181177_ex31-2.htm
EX-32.2 - Pro-Tech Industries, Inc.	v181177_ex32-2.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2009

Commission file number: 000-53013

Pro-Tech Industries, Inc.

(Exact Name of Small Business Issuer in its Charter)

Nevada		20-8758875
(State of Incorporation)		(IRS Employer ID No.)

8550 Younger Creek Drive

Sacramento, CA 95828

(Address of Registrant's Principal Executive Offices) (Zip Code)

(916-504-4044)

Title of Each Class		Name of Each Exchange on which Registered
Common Stock, $0.001 par value		Over the Counter Bulletin Board

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ¨ Yes x No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨ Yes x No

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 x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such a shorter period that the registrant was required to submit and post such files). Yes ¨ x No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or smaller reporting company. See definition of “accelerated filer large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨		Accelerated filer ¨
Non-accelerated filer ¨		Smaller Reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act. Yes ¨ No x

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes o No x

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. Solely for purposes of the foregoing calculation, all of the registrant’s directors and officers are deemed to be affiliates. $16,006,400.

State the number of shares outstanding of each of the issuer’s classes of equity securities, as of the latest practicable date: At April 15, 2010, there were 18,593,880 shares of Common Stock, $0.001 par value per share issued and no shares of preferred stock.

Documents Incorporated By Reference

None

Pro-Tech Industries, Inc.

FORM 10-K ANNUAL REPORT

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009

TABLE OF CONTENTS

PART I		4
ITEM 1. BUSINESS		4
ITEM 1A. RISK FACTORS		10
ITEM 1B. UNRESOLVED STAFF COMMENTS		17
ITEM 2. PROPERTIES		17
ITEM 3. LEGAL PROCEEDINGS		17
ITEM 4. RESERVED		17
PART II		18
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES		18
ITEM 6. SELECTED FINANCIAL DATA		19
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION		19
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		21
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA		F-2
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE		22
ITEM 9A. CONTROLS AND PROCEDURES		22
ITEM 9B. OTHER INFORMATION		23
PART III		23
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE		23
ITEM 11. EXECUTIVE COMPENSATION		25
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS		32
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE		34
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES		35
PART IV		36
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS SCHEDULES		36
SIGNATURES		37
CERTIFICATION PURSUANT TO SECTION 302 (a) OF THE SARBANES-OXLEY ACT OF 2002
Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-oxley act of 2002

Special Note Regarding Forward-Looking Statements

Some of our statements under "Business," "Properties," "Legal Proceedings," "Management's Discussion and Analysis of Financial Condition and Results of Operations,"" the Notes to Financial Statements and elsewhere in this report constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are subject to certain events, risks and uncertainties that may be outside our control. Some of these forward-looking statements include statements of:

management's plans, objectives and budgets for its future operations and future economic performance;

capital budget and future capital requirements;

meeting future capital needs;

realization of any deferred tax assets;

the level of future expenditures;

impact of recent accounting pronouncements;

the outcome of regulatory and litigation matters; and

the assumptions described in this report underlying such forward-looking statements.

Actual results and developments may materially differ from those expressed in or implied by such statements due to a number of factors, including:

those described in the context of such forward-looking statements;

future product development and manufacturing costs;

changes in our incentive plans;

timely development and acceptance of new products;

the markets of our domestic and international operations;

the impact of competitive products and pricing;

the political, social and economic climate in which we conduct operations; and

the risk factors described in other documents and reports filed with the Securities and Exchange Commission.

In some cases, forward-looking statements are identified by terminology such as "may," "will," "should," "could," "would," "expects," "plans," "intends," "anticipates," "believes," "estimates," "approximates," "predicts," "potential" or "continue" or the negative of such terms and other comparable terminology.

Although we believe that the expectations reflected in these forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we nor anyone else assumes responsibility for the accuracy and completeness of such statements and is under no duty to update any of the forward-looking statements after the date of this report.

Unless otherwise noted, references in this Form 10-K to “Pro-Tech Industries”, “PTI”, “Meltdown”, “we”, “us”, “our”, and the “Company” means Pro-Tech Industries, Inc., a Nevada corporation. Our principal place of business is located at 8550 Younger Creek Drive, Sacramento, CA 95828. Our telephone number is (916) 504-4044.

PART I

ITEM 1. BUSINESS.

Pro-Tech Industries was incorporated in the State of Nevada on April 4, 2007 (originally named Meltdown Massage and Body Works, inc.) , and was a development stage company with the principal business objective of becoming a chain of professional body treatment and skin care service centers offering spacious, luxurious settings and a multitude of personal services including a variety of styles of massages, aromatherapy, heated stones, exfoliate and moisturizing treatments, mud baths, facials, manicures and pedicures, waxing and special occasion make-up appointments as well as consultations for everyday make-up applications.

ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

On December 31, 2008, we executed an agreement with Pro-Tech Fire Protection Systems Corp (“Pro-Tech”), and our Company (the "Agreement"), whereby pursuant to the terms and conditions of that Agreement, Pro-Tech shareholders acquired ten million (10,100,000) shares of our common stock, whereby Pro-Tech would become a wholly owned subsidiary of the Company. This issuance of stock did not involve any public offering, general advertising or solicitation. At the time of the issuance, Pro-Tech had fair access to and was in possession of all available material information about our company. The shares bear a restrictive transfer legend in accordance with Rule 144 under the Securities Act. The issuance of the securities above were effected in reliance on the exemptions for sales of securities not involving a public offering, as set forth in Rule 506 promulgated under the Securities Act of 1933, as amended (the "Securities Act") and in Section 4(2) and Section 4(6) of the Securities Act and/or Rule 506 of Regulation D.

PRO-TECH FIRE PROTECTION SYSTEMS CORP

Pro-Tech Fire Protection Systems Corp. (“Pro-Tech”) was incorporated on May 4, 1995 under the laws of the State of California to engage in any lawful corporate undertaking, including, but not limited to; installation, repair and inspections of fire protection systems in commercial, military and industrial settings.

Pro-Tech Fire Protection Systems is a full-service contractor serving the western United States, with offices in California and Nevada. Services include estimating, designing, fabricating, and installing all types of standard and specialty water-based fire protection systems. In addition, the company offers “Day Work” services, including inspecting, testing, repairing and servicing of same.

We serve the new construction market, as well as customers retro-fitting, upgrading or repairing their existing facilities, bringing existing facilities to current standards (for example, installing sprinklers at a customer’s expanded storage warehouse, etc.). Since current codes require fire protection systems, work load remains fairly constant. Management believes that with this diversity of services, future prospects remain strong.

Most jobs are won by negotiation or by standard bidding practices from a variety of sources, including repeat customers, referrals, and multiple media resources (trade-specific marketing services, internet links, phone book ads, etc.). We routinely work with many regular customers participating in numerous MACC programs (Multiple Award Construction Contracts for government projects).

Upon award, we design most projects with in-house NICET certified project managers and designers. We also maintain close relationships with outside design firms and engineers to manage occasional overflow workloads. Design development typically includes close coordination with the prime contractor, as well as other sub-contractors.

Material is procured from a number of local and nation-wide fire protection suppliers. Fabricated materials are likewise obtained from these, as well as independent, fab shops. Both fabricated and loose materials are readily available from many excellent long-standing vendors there is no need to perform routine in-house fabrication, allowing us to keep overhead low.

Most installation work begins after a building is enclosed with walls and a roof, minimizing weather-related risks or delays. Regular site visits ensure smooth installation progress. Quality control is strictly maintained by site foremen, superintendants, and construction, project, and area managers. Additionally, work must pass inspection and testing requirements of project and fire department officials, providing the final seal-of-approval.

“Day Work” jobs typically wrap up in a matter of days, involving tenant improvements, repairs, etc. With 24-hour service, we can handle emergency needs for commercial and residential customers needing repairs, service, system restoration, etc. Inspections make up a recurring source of work and revenue, as systems are required by law to be inspected and professionally maintained. Inspections usually involve visual verification of system component status, and some operating of valves, so operating risk is negligible.

In summary, Pro-Tech’s business model is well-founded, with long-established relationships with superb customers and vendors, providing for a strong future in the near and long term.

While government regulations are always changing, Pro-Tech is able to work within the rules of local, regional, state and federal guidelines to meet compliance in all areas of the job, whether it is related to prevailing wage, environmental or fire codes. Most costs of compliance are considered when bidding a job and therefore do not generally have a large impact on us.

Pro-Tech services include:

Commercial, Special Hazards, and Industrial Overhead Wet Pipe, Dry Pipe, Pre-Action, Deluge, and Foam

New Installations, Retro-Fits, Upgrades, Repairs, Design, Consultations, and Analysis

Pumps, Hydrants, Backflow Preventers, Underground, Design, and Consultation

5 Year Certification, Inspections and Testing

24 Hour Service

Alarm & Detection installation and monitoring, inspections and repairs

Electrical Services including design build, new construction, repairs, inspections and maintenance

Network cabling, system and structure testing and data networking and design

Management estimates that we have grown over twenty-fold in the 13 plus years that we have been serving our customers. With more than 150 years of combined fire protection experience among its staff and management, management believes that we deliver high quality service in the most economic manner, with a high degree of integrity, excellence, and innovation within the fire protection industry.

We believe that the addition of the additional disciplines will help strengthen relationships with current customers as well as help us to establish ourselves with new customers with the ability to bid multiple disciplines on a project, while allowing us to more efficiently cover overhead costs.

Pro-Tech Telecommunications Segment

Pro-Tech Telecommunications provides inside/outside plant installation/implementation services, telecommunications hardware/software deployment (voice systems), maintenance support services, on-site technicians for telecommunications upgrades, and cable system design services. In addition, Pro-Tech Telecommunications also has a full data networking group that can design, configure, and deploy custom data networking solutions based on individual client needs. Pro-Tech Telecommunications provides the following services to commercial, government and other business enterprises.

Services Offered:

Infrastructure Systems/Services

Building Riser and Campus Systems

Cabinet and Rack Installation

Cable Tagging and Documentation

Communications Rooms, MDF, IDF

Optical and Copper Cable Installation

Raceway Systems

Wireless Connectivity Solutions

Low Voltage Systems

Security Systems

Fire Alarm

Card Access Control

CATV

Video Surveillance

Network Systems

Enterprise architecture strategy

Systems integration

IT infrastructure, implementation, and support

Network security and remote access solutions

Authentication

Voice Systems

PBX

Key system

VoIP

We differentiate ourselves through our commitment to the highest degree of structure, efficiency and quality practices. We consider ourselves experts at providing solutions that precisely fit our client's needs. We do not manufacture equipment and are vendor agnostic when providing equipment solutions (i.e. we will install customer or vendor owned/provided equipment). Our mission is to provide cost-effective, high quality services and solutions to enhance the competitive position of our clients, using creative and innovative approaches. In pursuit of these goals, Pro-Tech Telecommunications adheres to the following fundamental principles:

Clients as Partners

We strive to build "lifetime" relationships with our clients by providing them with the highest quality services, advanced technology and added value in order to earn and maintain their respect, trust and loyalty. We believe our contribution to this relationship is our expertise in providing the best possible services to our clients. Our services are based on professionalism, competence, integrity and openness.

Our People

Pro-Tech Telecommunications is an organization of individuals. We place a very high value on the skills, experience and creativity that our employees bring to the group. We believe that our professionals are among the best in our industry and we are completely confident in their ability to meet or exceed the expectations of our clients.

Integrity

We adhere to a strict code of business conduct, ensuring that our people employ the highest standards of business ethics in all dealings with clients, suppliers, fellow employees and with the general public.

Quality

Pro-Tech Telecommunications continuously strives for excellence by providing high-quality, high-value deliverables to our clients. By achieving this goal, we believe that ensure that our clients remained satisfied with the work we have delivered for years to come and that they value Pro-Tech Telecommunications their technology partner of choice.

Contract Process

A fair amount of Pro-Tech Telecommunication’s business success has been based on negotiated/relationship driven work and a small amount of traditional bid work (i.e. blue print take offs and submitting price quotes to general contractors on bid day). We are typically responding to formal “Request for Proposals” (RFPs) and looking for existing “Master Service Agreements” (MSAs) to amend our services to. We are always seeking out strategic partnerships to provide our customers with an overall integrated solution (i.e. equipment suppliers with our installation services).

Market Opportunity

According to the-infoshop.com (http://www.the-infoshop.com/study/ftm53024-cabling-sys.html), the total US Structured Cabling Systems (SCS) Market is forecasted to grow at a rate of 18.6%, from $6.8 billion in 2007 to $15.9 billion by 2012. This growth is higher than previously reported, as newer network applications (i.e. VOIP, data centers and video over IP) are expected to grow dramatically in the future. SCS cabling architecture is evolving to a universal enterprise network consisting of the current primary installed LAN networks supporting newer IP sub nets, such as voice with VOIP, data for the data centers and video via video over IP.

As the SCS market is expected to grow, Pro-Tech Telecommunications will recognize significant revenue growth from the following industry segments and forecasted opportunities:

System Integrators – Negotiated bid work (i.e. existing relationships on current projects)

Commercial builders/developers – Bid work with strategic business partners (i.e. electrical and general contractors)

Modular furniture designers/builders - Office build outs, preferred vendor list, etc

Commercial/industrial property management companies - Tenant improvement work, new and/or old shell build outs, etc

Telecommunication/wireless vendors – Infrastructure upgrades, DEMARC extensions, etc

Federal government contractors – Strategic partnerships, negotiated jobs, etc

Federal, State, and local municipalities – GSA work, 8-A set aside, Multiple award schedules, cabling service contracts, etc

Targeted Markets

Pro-Tech Telecommunications goal is to become a market leader in the design/build communication infrastructure products and services industry. We are well positioned in the following vertical markets and will use the following methods to expand and to increase our new areas of doing business:

Vertical Markets

System Integrators

Commercial builders/developers

Modular furniture designers/builders

Commercial/industrial property management companies

Telecommunication/wireless vendors

Federal government contractors

Federal, State, and local municipalities

Contract Vehicles

Existing supplier and “Master Service” agreements

Negotiated bid work

Request for Proposals (RFP)

General Service Administration (GSA) Schedules

CALNET II (State of California)

CA Multiple Award Schedule (CMAS)

Pre-qualification process

Business Development Philosophy

Build on existing relationships (i.e. negotiated work)

Subscribe to online bid tools

Form strategic partnerships with Disabled Veteran Owned Enterprise (DVBE) companies

Work with certified contractors

Define geographic growth territories

Join applicable trade organizations

Pro-Tech Electrical Segment

Pro-Tech Electrical Services Division is a full service Electrical contractor providing reliable and quality workmanship throughout California. Our capacities are not limited to commercial and industrial project but, to a vast range of electrical construction projects. Our primary bid focus has been in the areas of heavy commercial such as large distribution centers, commercial retail (shopping centers, etc.), and institutional work (schools, churches, etc.) We strive to provide competitive pricing for the commercial and industrial bid market. We furnish detailed and competitive pricing, value engineering options, and a team approach to our clients. Pro-Tech Electrical provides the following services to commercial, government and other business enterprises:

Electrical Services

Building riser and campus systems

Underground service upgrades and installation

Installation of power switchboards services, Motor Control Centers (MCC) and/or upgrades.

New emergency generators, controls and transfer switches.

UPS (Uninterruptible Power Systems) and upgrades.

Fuse and Circuit Breaker upgrade and installations

Interior/ exterior Lighting and related controls.

Site lighting installation and upgrades

Security lighting

Industrial electrical projects including explosion proof equipment and installations.

Load analysis

Commercial and industrial maintenance

Contract Process

As an Electrical bidder for a specific job, we estimate all the electrical material and related labor to provide a complete electrical system per the electrical drawings and specifications. This proposal is reviewed along with other electrical contractors bids and the lowest responsible bidder wins the contract. After the contract is awarded then submittals are organized and submitted to the projects architect and engineer for approval. Product data submittals, samples, and shop drawings are required primarily for the architect and engineer to verify that the correct products will be installed on the project. Commercial buildings will often have complex pre-fabricated components. These include: elevators, cabinets, air handling units, generators, appliances and cooling towers. These pieces of equipment often require us to work closely and coordinate with the other trades to ensure that they receive the correct power. Our electrical material is purchased from numerous vendors. We have established a strong relationship with a small group of these vendors. Since electrical contractor are the first discipline on the project and the last to finish we feel that these relationships with our vendors we are able to get our materials in a timely manner to ensure the project meets the required schedule.

We are dedicated in providing our customers with the highest standards of workmanship, integrity and dependability. Our electrical division will proudly service commercial and industrial facilities 24 hours per day, 7 days per week, including weekends and holidays. Our electrical division is approved to be available on call 24 hours to perform service in the AT&T environment.

Conesco, Inc.

On January 16, 2009, the Company issued 3,000,000 shares to shareholders of Conesco, Inc. (“Conesco”,), as part of an acquisition, whereby Conesco would become a wholly owned subsidiary of the Company.

Since 1993, Conesco, Inc., has been a provider of commercial flooring products, installation, maintenance and design consultation services to businesses throughout Northern California. Our work graces some of the most prestigious properties in Northern California and beyond. Conesco’s award-winning team (30 employees) approach has earned the company a reputation for leading-edge flooring expertise, great service and first-class products. Conesco offers the following products and services:

Professional design and specification consultation

Material and installation of carpet, resilient, ceramic stone, and wood flooring

Material and installation of raised access/Clean Room flooring

Modular wiring and under-floor HVAC delivery systems

Ongoing maintenance services

Green building consultation

Consultation and expertise in complex/unique flooring installations

Conesco’s expertise in the field of commercial and industrial flooring has allowed them to work with the following premier building contractors in Northern California:

Roebbelen Contracting

McCarthy Construction

Howard S. Wright

MP Allen

Strategy and Positioning

The Company’s internal growth strategy relies mostly on building and maintaining positive customer relationships. The company also plans to grow externally, through strategic acquisition and alliance activities. There are four key elements in the Company’s overall growth strategy:

Expand portfolio of services through growth of A&D, telecommunications and electrical services

Focus on internal growth and development

Focus on expanding operating efficiencies

Pursue strategic acquisitions and partnerships

Expansion of portfolio of services allows us to offer a “one stop shop” and offer our customers the ability to coordinate multiple disciplines with one contact, minimizing time and energy spent in coordination where multiple vendors might have been used for all of these disciplines. This allows both us and our customers to more efficiently use overhead resources.

In slow economic times, such as what we are currently experiencing, we feel by developing our current associates to be able to cover more diverse functions, allows us to keep our seasoned employees. We can develop and cross train employees, within their respective disciplines, so that when the economy begins to grow, we will have a strong well trained staff to lead us. We also believe the expansion of our market, most recently to Reno and Las Vegas Nevada, puts us in strategic locations by covering the Northern and Southern California and Nevada markets, as well as giving us bases by which to access Arizona and Utah.

Focusing on expanding operating efficiencies is a focus we plan by having a corporate staff which can help all disciplines with their billing, receiving, payables, payroll, insurance, benefits and human resource functions. We will be able to leverage a single corporate location to help cover all of our locations and disciplines and spread out the cost of overhead. We also feel there are economies of scale in insurance and benefit costs that a company with a larger employee base can get that smaller companies tend to miss out on.

We also plan to use this slow economic time to pursue strategic relationships with our customers, while watching for opportunities to pick up strategic acquisitions in some of our newer markets and business segments. We feel working to strengthen alliances during the hard times will put us in a stronger position to move forward and build our business when the economy begins to turn. Likewise there are many good companies who are feeling the pinch of the current economics. There may be opportunities to merge, acquire or form strategic partnerships with these companies, which can in turn lead to additional growth in our current markets. This could also allow us to move into other markets we feel would add positive growth to the Company.

Client List

In addition to providing services directly to federal, state and local governments and Fortune 500 companies, the company has also established strong customer relationships with the following companies:

Aerojet

Hensel Phelps

RQ Construction

RA Birch

Raley’s

Soltek Pacific

SouthWestern Dakotah

Roebellin Construction

Howard S. Wright Construction

Competitive Landscape

The competition is divided among many entities in our four markets. The market is highly fragmented and there is not a dominate player in any of the markets. Two of the larger competitors are as follows:

Cosco – Cosco is a multifaceted, full service fire protection contractor, providing design, fabrication, installation service and inspection of a wide variety of automatic fire suppression systems. The company specializes in large construction projects including hospitals, high-rise structures, hotels, large office and manufacturing facilities. The company maintains experienced staff including engineers, designers, project managers and installers. Cosco has offices in Los Angeles, San Francisco, Seattle, Fresno, San Diego, and Anchorage.

Tyco/Grinnell (NYSE: TYC) - Tyco International, Ltd. operates as a diversified manufacturing and services company. The company, through its subsidiaries, designs, manufactures, and distributes electronic security and fire protection systems; electrical and electronic components; and medical devices and supplies, imaging agents, pharmaceuticals, and adult incontinence and infant care products. Tyco’s fire and security products and services include electronic security systems, fire detection systems and suppression systems, as well as fire extinguishers and related products. The company’s electrical and electronic components comprise electronic/electrical connector systems; fiber optic components; and wireless devices, such as private radio systems, heat shrink products, circuit protection devices, and magnetic devices.

Annual Meeting

On May 8, 2009, the Company’s stockholders approved a name change from Meltdown Massage and Body Works, Inc. to Pro-Tech Industries, Inc. which became effective with the filing of an amendment to the our Articles of Incorporation on May 11, 2009. The Company is now known as Pro-Tech Industries, Inc. and the new ticker symbol is “PTCK”. The shareholders also ratified RBSM, LLP as the Company’s auditors as well as re-elected of Mr. Gordon, Mr. Engelbrecht, and Mr. Crane as members of the board of directors.

Employees

The Company has approximately 85 full time employees including 17 executive and administrative staff, 5 in engineering, 6 in sales and marketing, with the balance working in the field as superintendants, foreman, journeyman or apprentices.

WHERE YOU CAN FIND MORE INFORMATION

You are advised to read this Form 10-K in conjunction with other reports and documents that we file from time to time with the SEC. In particular, please read our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we file from time to time. You may obtain copies of these reports directly from us or from the SEC at the SEC’s Public Reference Room at 100 F. Street, N.E. Washington, D.C. 20549, and you may obtain information about obtaining access to the Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov.

ITEM 1A. RISK FACTORS

We will require financing to fund our development activities and to support our operations. However, we may be unable to obtain such financing. We are also subject to risks factors specific to our business strategy and the wireless retail industry. Rapid changes in industry standards for wireless phones and services may require us to introduce new products and services before we can attain profitable operations. We may be unable to introduce new products and services on a timely basis. Moreover, there is no guarantee that any such products will allow us to achieve profitable operations in the future.

We have updated or restated the risk factors previously disclosed in our prior reports with the Securities and Exchange commission. We consider the following to be the material risks to an investor in us. We should be viewed as a high-risk investment and speculative in nature. An investment in our common stock may result in a complete loss of the invested amount.

Because we bear the risk of cost overruns in most of our contracts, we may experience reduced profits or, in some cases, losses under these contracts if costs increase above our estimates.

Our contract prices are established largely upon estimates and assumptions of our projected costs. These include assumptions about future economic conditions, prices, including commodities prices, and availability of labor, including the costs of providing labor, equipment, materials and other factors outside our control. If our estimates or assumptions prove to be inaccurate, if circumstances change in a way that renders our assumptions and estimates inaccurate or we fail to execute the work cost overruns may occur, and we could experience reduced profits or a loss for projects. For instance, unanticipated technical problems may arise, we could have difficulty obtaining permits or approvals, local laws or labor conditions could change, bad weather could delay construction, raw materials prices could increase, our suppliers' or subcontractors' may fail to perform as expected, or site conditions may be different than we expected. Additionally, in certain circumstances, we guarantee project completion or the achievement of certain acceptance and performance testing levels by a scheduled date. Failure to meet schedule or performance requirements typically results in additional costs to us, and in some cases we may also be liable for consequential and liquidated damages. Performance problems for existing and future projects could cause our actual results of operations to differ materially from those we anticipate as well as damaging our reputation within our industry and our customer base.

Many of the markets we do work in are currently experiencing an economic downturn that may materially and adversely affect our business because our business is dependent on levels of construction activity.

The demand for our services is dependent upon the existence of construction projects and service requirements within the markets in which we operate. Any period of economic recession affecting a market or industry in which we transact business is likely to adversely impact our business. Many of the projects we work on have long lifecycles from conception to completion, and the bulk of our performance generally occurs late in a construction project's lifecycle. We experience the results of economic trends well after an economic cycle begins. Accordingly, we believe that our business has yet to experience many of the adverse effects of the current economic recessionary cycle.

We cannot predict the severity or length of the current recession. We believe that the current uncertainty about economic conditions caused by the ongoing recession means that many of our customers are likely to postpone spending while credit markets remain, in large part, closed to funding commercial and industrial developments. The industries and markets we operate in have always been and will continue to be vulnerable to these general macroeconomic downturns because they are cyclical in nature. The current recession is causing a drop off in the demand for projects within our markets and industries, which will likely lead to greater price competition as well as decreased revenue and profit. The current recession is also likely to increase economic instability with our vendors, subcontractors, developers, and general contractors, which could cause us greater liability exposure and could result in us not being able to be paid, as well as decreased revenue and profit. Further, to the extent our vendors, subcontractors, developers, or general contractors seek bankruptcy protection, the bankruptcy will likely force us to incur additional costs in attorneys' fees, as well as other professional consultants, and will result in decreased revenue and profit.

Our backlog is subject to unexpected adjustments and a cancellation, which means that amounts included in our backlog may not result in actual revenue or translate into profits.

The revenue projected from our backlog may not be realized, or, if realized, may not result in profits. Projects may remain in our backlog for an extended period of time or project cancellations or scope adjustments may occur with respect to contracts reflected in our backlog. The revenue projected from our backlog may not be realized or, if realized, may not result in profits.

A significant portion of our business depends on our ability to provide surety bonds. Current difficulties in the financial and surety markets may adversely affect our bonding capacity and availability.

In the past we have expanded and it is possible we will continue to expand the number of total contract dollars that require an underlying bond. Surety market conditions are currently difficult as a result of significant losses incurred by many surety companies and the current recession. Consequently, less overall bonding capacity is available in the market and terms have become more expensive and restrictive. We may not be able to maintain a sufficient level of bonding capacity in the future, which could preclude our ability to bid for certain contracts or successfully contract with some customers. Additionally, even if we are able to access bonding capacity to sufficiently bond future work, we may be required to post collateral to secure bonds, which would decrease the liquidity we would have available for other purposes. Our surety providers are under no commitment to guarantee our access to new bonds in the future; thus, our ability to access or increase bonding capacity is at the sole discretion of our surety providers. If our surety companies were to limit or eliminate our access to bonds, our alternatives would include seeking bonding capacity from other surety companies, increasing business with clients that do not require bonds and posting other forms of collateral for project performance, such as letters of credit or cash. We may be unable to secure these alternatives in a timely manner, on acceptable terms, or at all. As such, if we were to experience an interruption or reduction in the availability of bonding capacity, it is likely we would be unable to compete for or work on certain projects.

Our use of the percentage-of-completion method of accounting could result in a reduction or reversal of previously recorded revenues or profits.

A material portion of our revenue is recognized using the percentage-of-completion method of accounting, which results in our recognizing contract revenues and earnings ratably over the contract term in the proportion that our actual costs bear to our estimated contract costs. The earnings or losses recognized on individual contracts are based on estimates of contract revenue, costs and profitability. We review our estimates of contract revenue, costs and profitability on an ongoing basis. Prior to contract completion, we may adjust our estimates on one or more occasions as a result of change orders to the original contract, collection disputes with the customer on amounts invoiced or claims against the customer for increased costs incurred by us due to customer-induced delays and other factors. Contract losses are recognized in the fiscal period when the loss is determined. Contract profit estimates are also adjusted in the fiscal period in which it is determined that an adjustment is required. As a result of the requirements of the percentage-of-completion method of accounting, the possibility exists, for example, that we could have estimated and reported a profit on a contract over several periods and later determined, usually near contract completion, that all or a portion of such previously estimated and reported profits were overstated. If this occurs, the full aggregate amount of the overstatement will be reported for the period in which such determination is made, thereby eliminating all or a portion of any profits from other contracts that would have otherwise been reported in such period or even resulting in a loss being reported for such period. On a historical basis, we believe that we have made reasonably reliable estimates of the progress towards completion on our long-term contracts. However, given the uncertainties associated with these types of contracts, it is possible for actual costs to vary from estimates previously made, which may result in reductions or reversals of previously recorded revenue and profits.

Intense competition in our industry could reduce our market share and our profit.

The markets we serve are highly competitive. Our industry is characterized by many small companies whose activities are geographically concentrated. We compete on the basis of our technical expertise and experience, financial and operational resources, nationwide presence, industry reputation and dependability. While we believe our customers consider a number of these factors in awarding available contracts, a large portion of our work is awarded through a bid process. Consequently, price is often the principal factor in determining which contractor is selected, especially on smaller, less complex projects. Smaller competitors are sometimes able to win bids for these projects based on price alone due to their lower cost and financial return requirements. We expect competition to intensify in our industry, presenting us with significant challenges in our ability to maintain strong growth rates and acceptable profit margins. If we are unable to meet these competitive challenges, we will lose market share to our competitors and experience an overall reduction in our profits.

If we are unable to attract and retain qualified managers and employees, we will be unable to operate efficiently, which could reduce our profitability.

Our business is labor intensive, and many of our operations experience a high rate of employment turnover. At times of low unemployment rates in the United States, it will be more difficult for us to find qualified personnel at low cost in some geographic areas where we operate. Additionally, our business is managed by a small number of key executive and operational officers. We may be unable to hire and retain the sufficient skilled labor force necessary to operate efficiently and to support our growth strategy. Our labor expenses may increase as a result of a shortage in the supply of skilled personnel. Labor shortages, increased labor costs or the loss of key personnel could reduce our profitability and negatively impact our business.

If we experience delays and/or defaults in customer payments, we could be unable to recover all expenditures.

Because of the nature of our contracts, at times we commit resources to projects prior to receiving payments from the customer in amounts sufficient to cover expenditures on projects as they are incurred. Delays in customer payments may require us to make a working capital investment. If a customer defaults in making their payments on a project in which we have devoted resources, it could have a material negative effect on our results of operations.

Actual and potential claims, lawsuits and proceedings could ultimately reduce our profitability and liquidity and weaken our financial condition.

We are likely to continue to be named as a defendant in legal proceedings claiming damages from us in connection with the operation of our business. Most of the actions against us arise out of the normal course of our performing services on project sites. We also are and are likely to continue to be a plaintiff in legal proceedings against customers, in which we seek to recover payment of contractual amounts we are owed as well as claims for increased costs we incur. When appropriate, we establish provisions against possible exposures, and we adjust these provisions from time to time according to ongoing exposure. If our assumptions and estimates related to these exposures prove to be inadequate or wrong, we could experience a reduction in our profitability and liquidity and a weakening of our financial condition. In addition, claims, lawsuits and proceedings may harm our reputation or divert management resources away from operating our business.

Our recent and future acquisitions may not be successful.

We expect to continue pursuing selective acquisitions of businesses. We cannot assure you that we will be able to locate acquisitions or that we will be able to consummate transactions on terms and conditions acceptable to us, or that acquired businesses will be profitable. Acquisitions may expose us to additional business risks different than those we have traditionally experienced. We also may encounter difficulties integrating acquired businesses and successfully managing the growth we expect to experience from these acquisitions.

We may choose to finance future acquisitions with debt, equity, cash or a combination of the three. We can give no assurances that any future acquisitions will not dilute earnings or disrupt the payment of a stockholder dividend. To the extent we succeed in making acquisitions, a number of risks will result, including:

•	The assumption of material liabilities (including for environmental-related costs);

•	Failure of due diligence to uncover situations that could result in legal exposure or to quantify the true liability exposure from known risks;

•	The diversion of management's attention from the management of daily operations to the integration of operations;

•	Difficulties in the assimilation and retention of employees and difficulties in the assimilation of different cultures and practices, as well as in the assimilation of broad and geographically dispersed personnel and operations, as well as the retention of employees generally;

•	The risk of additional financial and accounting challenges and complexities in areas such as tax planning, treasury management, financial reporting and internal controls; and

•	We may not be able to realize the cost savings or other financial benefits we anticipated prior to the acquisition.

The failure to successfully integrate acquisitions could have an adverse effect on our business, financial condition and results of operations.

If we do not effectively manage our growth, our existing infrastructure may become strained, and we may be unable to increase revenue growth.

Our past and any future growth that we have experienced, and in the future may experience, may provide challenges to our organization, requiring us to expand our personnel and our operations. Future growth may strain our infrastructure, operations and other managerial and operating resources. If our business resources become strained, our earnings may be adversely affected and we may be unable to increase revenue growth. Further, we may undertake contractual commitments that exceed our labor resources, which could also adversely affect our earnings and our ability to increase revenue growth.

Failure or circumvention of our disclosure controls and procedures or internal controls over financial reporting could seriously harm our financial condition, results of operations, and our business.

We plan to continue to maintain and strengthen internal controls and procedures to enhance the effectiveness of our disclosure controls and internal controls over financial reporting. Any system of controls, however well designed and operated, is based in part on certain assumptions and can provide only reasonable, and not absolute, assurances that the objectives of the system are met. Any failure of our disclosure controls and procedures or internal controls over financial reporting could harm our financial condition and results of operations.

Conflicts of interest

Certain of our officers and directors will also serve as directors of other companies or have significant shareholdings in other companies that may be in a similar business. To the extent that such other companies participate in ventures in which we may participate, or compete for prospects or financial resources with us, these officers and directors of will have a conflict of interest in negotiating and concluding terms relating to the extent of such participation. In the event that such a conflict of interest arises at a meeting of the board of directors, a director who has such a conflict must disclose the nature and extent of his interest to the board of directors and abstain from voting for or against the approval of such participation or such terms.

In accordance with the laws of the State of Nevada, our directors are required to act honestly and in good faith with a view to the best interests of our shareholders. In determining whether or not we will participate in a particular program and the interest therein to be acquired by it, the directors will primarily consider the degree of risk to which we may be exposed and its financial position at that time.

The regulation of penny stocks by SEC and FINRA may discourage the tradability of the company’s securities.

The Company is a "penny stock" company. None of its securities currently trade in any market and, if ever available for trading, will be subject to a Securities and Exchange Commission rule that imposes special sales practice requirements upon broker-dealers who sell such securities to persons other than established customers or accredited investors. For purposes of the rule, the phrase "accredited investors" means, in general terms, institutions with assets in excess of $5,000,000, or individuals having a net worth in excess of $1,000,000 or having an annual income that exceeds $200,000 (or that, when combined with a spouse's income, exceeds $300,000). For transactions covered by the rule, the broker-dealer must make a special suitability determination of the purchaser and receive the purchaser's written agreement to the transaction prior to the sale. Effectively, this discourages broker-dealers from executing trades in penny stocks. Consequently, the rule will affect the ability of purchasers in this offering to sell their securities in any market that might develop, because it imposes additional regulatory burdens on penny stock transactions.

In addition, the Securities and Exchange Commission has adopted a number of rules to regulate "penny stocks". Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and Exchange Act of 1934, as amended. Because our securities constitute “penny stocks" within the meaning of the rules, the rules would apply to us and to our securities. The rules will further affect the ability of owners of shares to sell their securities in any market that might develop for them because it imposes additional regulatory burdens on penny stock transactions.

Shareholders should be aware that, according to Securities and Exchange Commission, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (iii) "boiler room" practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and (v) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, leaving investors with losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to the Company's securities.

Certain Nevada Corporation Law Provisions Could Prevent A Potential Takeover, Which Could Adversely Affect The Market Price Of Our Common Stock.

We are incorporated in the State of Nevada. Certain provisions of Nevada corporation law could adversely affect the market price of our common stock. Because Nevada corporation law requires board approval of a transaction involving a change in our control, it would be more difficult for someone to acquire control of us. Nevada corporate law also discourages proxy contests making it more difficult for you and other shareholders to elect directors other than the candidate or candidates nominated by our board of directors.

We do not pay cash dividends

We do not pay cash dividends. We have not paid any cash dividends since inception and have no intention of paying any cash dividends in the foreseeable future. Any future dividends would be at the discretion of our board of directors and would depend on, among other things, future earnings, our operating and financial condition, our capital requirements, and general business conditions. Therefore, shareholders should not expect any type of cash flow from their investment.

Rule 144 sales in the future may have a depressive effect on the Company’s stock price.

All of the outstanding shares of common stock held by the present officers, directors, and affiliate stockholders are "restricted securities" within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted shares, these shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Act and as required under applicable state securities laws. Officers, directors and affiliates will be able to sell their shares if this Registration Statement becomes effective. Rule 144 provides in

essence that a person who is an affiliate or officer or director who has held restricted securities for six months may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the greater of 1.0% of a company's outstanding common stock. There is no limit on the amount of restricted securities that may be sold by a non-affiliate after the owner has held the restricted securities for a period of six months if the company is a current, reporting company under the '34 Act. A sale under Rule 144 or under any other exemption from the Act, if available, or pursuant to subsequent registration of shares of common stock of present stockholders, may have a depressive effect upon the price of the common stock in any market that may develop. In addition, if we are deemed a shell company pursuant to Section 12(b)-2 of the Act, our "restricted securities", whether held by affiliates or non-affiliates, may not be re-sold for a period of 12 months following the filing of a Form 10 level disclosure or registration pursuant to the Act.

The Company’s investors may suffer future dilution due to issuances of shares for various considerations in the future.

There may be substantial dilution to the Company's shareholders purchasing in future offerings as a result of future decisions of the Board to issue shares without shareholder approval for cash, services, or acquisitions.

Because We Are Quoted On The OTCBB Instead Of An Exchange Or National Quotation System, Our Investors May Have A Tougher Time Selling Their Stock Or Experience Negative Volatility On The Market Price Of Our Stock.

Our common stock is traded on the OTCBB. The OTCBB is often highly illiquid, in part because it does not have a national quotation system by which potential investors can follow the market price of shares except through information received and generated by a limited number of broker-dealers that make markets in particular stocks. There is a greater chance of volatility for securities that trade on the OTCBB as compared to a national exchange or quotation system. This volatility may be caused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrative supervision of bid and ask quotations, lower trading volume, and market conditions. Investors in our common stock may experience high fluctuations in the market price and volume of the trading market for our securities. These fluctuations, when they occur, have a negative effect on the market price for our securities. Accordingly, our stockholders may not be able to realize a fair price from their shares when they determine to sell them or may have to hold them for a substantial period of time until the market for our common stock improves.

The stock will in all likelihood be thinly traded and as a result, investors may be unable to sell at or near ask prices or at all if they need to liquidate shares.

Our shares of common stock may be thinly-traded on the OTC Bulletin Board, meaning that the number of persons interested in purchasing our common shares at or near ask prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors, including the fact that it is a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if the Company came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven, early stage company such as ours or purchase or recommend the purchase of any of our Securities until such time as it became more seasoned and viable. As a consequence, there may be periods of several days or more when trading activity in the Company's Securities is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on the Securities price. We cannot give investors any assurance that a broader or more active public trading market for the Company's common securities will develop or be sustained, or that any trading levels will be sustained. Due to these conditions, we can give investors no assurance that they will be able to sell their shares at or near ask prices or at all if they need money or otherwise desire to liquidate their securities of the Company.

Failure To Achieve And Maintain Effective Internal Controls In Accordance With Section 404 Of The Sarbanes-Oxley Act Could Have A Material Adverse Effect On Our Business And Operating Results.

It may be time consuming, difficult and costly for us to develop and implement the additional internal controls, processes and reporting procedures required by the Sarbanes-Oxley Act. We may need to hire additional financial reporting, internal auditing and other finance staff in order to develop and implement appropriate additional internal controls, processes and reporting procedures. If we are unable to comply with these requirements of the Sarbanes-Oxley Act, we may not be able to obtain the independent accountant certifications that the Sarbanes-Oxley Act requires of publicly traded companies.

If we fail to comply in a timely manner with the requirements of Section 404 of the Sarbanes-Oxley Act regarding internal control over financial reporting or to remedy any material weaknesses in our internal controls that we may identify, such failure could result in material misstatements in our financial statements, cause investors to lose confidence in our reported financial information and have a negative effect on the trading price of our common stock.

Pursuant to Section 404 of the Sarbanes-Oxley Act and current SEC regulations, beginning with our annual report on Form 10-K for our fiscal period ending December 31, 2007, we will be required to prepare assessments regarding internal controls over financial reporting and beginning with our annual report on Form 10-K for our fiscal period ending December 31, 2009, furnish a report by our management on our internal control over financial reporting. We have begun the process of documenting and testing our internal control procedures in order to satisfy these requirements, which is likely to result in increased general and administrative expenses and may shift management time and attention from revenue-generating activities to compliance activities. While our management is expending significant resources in an effort to complete this important project, there can be no assurance that we will be able to achieve our objective on a timely basis. There also can be no assurance that our auditors will be able to issue an unqualified opinion on management’s assessment of the effectiveness of our internal control over financial reporting. Failure to achieve and maintain an effective internal control environment or complete our Section 404 certifications could have a material adverse effect on our stock price.

In addition, in connection with our on-going assessment of the effectiveness of our internal control over financial reporting, we may discover “material weaknesses” in our internal controls as defined in standards established by the Public Company Accounting Oversight Board, or the PCAOB. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. The PCAOB defines “significant deficiency” as a deficiency that results in more than a remote likelihood that a misstatement of the financial statements that is more than inconsequential will not be prevented or detected.

In the event that a material weakness is identified, we will employ qualified personnel and adopt and implement policies and procedures to address any material weaknesses that we identify. However, the process of designing and implementing effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company. We cannot assure you that the measures we will take will remediate any material weaknesses that we may identify or that we will implement and maintain adequate controls over our financial process and reporting in the future.

Any failure to complete our assessment of our internal control over financial reporting, to remediate any material weaknesses that we may identify or to implement new or improved controls, or difficulties encountered in their implementation, could harm our operating results, cause us to fail to meet our reporting obligations or result in material misstatements in our financial statements. Any such failure could also adversely affect the results of the periodic management evaluations of our internal controls and, in the case of a failure to remediate any material weaknesses that we may identify, would adversely affect the annual auditor attestation reports regarding the effectiveness of our internal control over financial reporting that are required under Section 404 of the Sarbanes-Oxley Act. Inadequate internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock.

SHOULD ONE OR MORE OF THE FOREGOING RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD THE UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, EXPECTED, INTENDED OR PLANNED.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. DESCRIPTION OF PROPERTY

Facilities

PTI’s headquarters are currently located in two facilities totaling 22,000 square feet in Sacramento, California. This building is shared jointly with the Fire Protection, Telco and Electrical segments as well as Conesco, Inc. We also have branch offices in Oceanside, CA and Las Vegas and Reno, NV. The bulk of the workforce is out in the field.

The Company signed a 3 year lease with a two year option beginning December 2009. The monthly lease cost is $5,550 per month for the two buildings.

We are currently 3 years into a 5 year lease in our Oceanside office. The rate is slightly above market and we are looking to see if there are any opportunities to renegotiate this lease. The monthly lease cost is $4,016 per month.

Our Reno office is also in a month to month lease and we are assessing the opportunity to renegotiate the lease. The monthly lease cost is $2,674 per month.

Our Las Vegas office was opened in a 2,800 square foot building in North Las Vegas. We have a 40 month lease in this facility. The monthly lease cost is $1,182 per month.

ITEM 3. LEGAL PROCEEDINGS.

We are not a party to any legal proceedings, there are no known judgments against the Company, nor are there any known actions or suits filed or threatened against it or its officers and directors, in their capacities as such. We are not aware of any disputes involving the Company and the Company has no known claim, actions or inquiries from any federal, state or other government agency. We are not aware of any claims against the Company or any reputed claims against it at this time, except as follows:

In March 2008, a wage and hour class action law suit was filed against the Company by three former employees and Sprinkler Fitters Union Local 669. The suit was settled with all parties in June 2009. The full impact is contained in the operating results contained herein.

In September 2009, Pro-Tech Fire Protection Systems Corp was named in a suit by a local bank. The Company believes that it has meritorious defenses to the plaintiff’s claims and intends to vigorously defend itself against the Plaintiff’s claims. Management believes the ultimate outcome of this matter will not have a material adverse effect on the Company’s consolidated financial position or results of operations. The Company will seek recourse for any costs it incurs in defending itself against this claim.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Shares of our common stock commenced trading on January 30 2009, on the National Association of Securities Dealers Inter-dealer Quotation System Over The Counter Bulletin Board under the symbol “MMBW.OB” and was subsequently changed to “PTCK.OB” in May 2009. For the periods indicated, the following table sets forth the high and low bid prices per share of common stock, as reported by the Over The Counter Bulletin. These prices represent inter-dealer quotations without retail markup, markdown, or commission and may not necessarily represent actual transactions.

	High		Low
Fiscal Year 2009
First Quarter (January – March 2009)	$	3.45	$	2.05
Second Quarter (April – June 2009)	$	3.55	$	2.80
Third Quarter (July – September 2009)	$	3.00	$	1.90
Fourth Quarter (October – December 2009)	$	1.50	$	0.65

Fiscal Year 2008 (not traded prior to Jan 2009)

On April 15, 2010, the closing bid price of our common stock was $0.29.

Dividends

We may never pay any dividends to our shareholders. We did not declare any dividends for the year ended December 31, 2009. Our Board of Directors does not intend to distribute dividends in the near future. The declaration, payment and amount of any future dividends will be made at the discretion of the Board of Directors, and will depend upon, among other things, the results of our operations, cash flows and financial condition, operating and capital requirements, and other factors as the Board of Directors considers relevant. There is no assurance that future dividends will be paid, and if dividends are paid, there is no assurance with respect to the amount of any such dividend.

Transfer Agent

Island Stock Transfer, 100 Second Avenue South, Suite705S, St Petersburg, FL 33701 will act as transfer agent for our common stock.

RECENT SALES OF UNREGISTERED SECURITIES.

During the past three years, we have sold or issued securities which were not registered as follows:

On December 31, 2008, the Company issued 10,100,000 shares to Pro-Tech Fire Protection Systems Corp. (“Pro-Tech”) as part of a merger, whereby Pro-Tech would become a wholly owned subsidiary of the Company. This issuance of stock did not involve any public offering, general advertising or solicitation. At the time of the issuance, Pro-Tech had fair access to and was in possession of all available material information about our company. The shares bear a restrictive transfer legend in accordance with Rule 144 under the Securities Act.

On January 16, 2009, the Company issued 3,000,000 shares to shareholders of Conesco, Inc. (“Conesco”) as part of a merger, whereby Conesco would become a wholly owned subsidiary of the Company. This issuance of stock did not involve any public offering, general advertising or solicitation. At the time of the issuance, Conesco had fair access to and was in possession of all available material information about our company. The shares bear a restrictive transfer legend in accordance with Rule 144 under the Securities Act.

On January 19, 2009 the Company issued 1,000,000 shares to key employees of the Company as incentive would become a wholly owned subsidiary of the Company. This issuance of stock did not involve any public offering, general advertising or solicitation. At the time of the issuance, Pro-Tech had fair access to and was in possession of all available material information about our company. The shares bear a restrictive transfer legend in accordance with Rule 144 under the Securities Act.

ITEM 6. SELECT FINANCIAL DATA.

This section is not applicable since we are a small reporting company.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS PLAN OF OPERATION

The following discussion and analysis should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this registration statement. Portions of this document that are not statements of historical or current fact are forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. The cautionary statements made in this registration statement should be read as applying to all related forward-looking statements wherever they appear in this registration statement. From time to time, we may publish forward-looking statements relative to such matters as anticipated financial performance, business prospects, technological developments and similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. All statements other than statements of historical fact included in this section or elsewhere in this report are, or may be deemed to be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Important factors that could cause actual results to differ materially from those discussed in such forward-looking statements include, but are not limited to, the following: changes in the economy or in specific customer industry sectors; changes in customer procurement policies and practices; changes in product manufacturer sales policies and practices; the availability of product and labor; changes in operating expenses; the effect of price increases or decreases; the variability and timing of business opportunities including acquisitions, alliances, customer agreements and supplier authorizations; our ability to realize the anticipated benefits of acquisitions and other business strategies; the incurrence of debt and contingent liabilities in connection with acquisitions; changes in accounting policies and practices; the effect of organizational changes within the Company; the emergence of new competitors, including firms with greater financial resources than ours; adverse state and federal regulation and legislation; and the occurrence of extraordinary events, including natural events and acts of God, fires, floods and accidents.

The following discussion and analysis of our plan of operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this prospectus. This discussion and analysis contain forward-looking statements that involve risks, uncertainties and assumptions. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those presented under the heading of “Risk Factors” and elsewhere in this annual report.

RESULTS OF OPERATIONS

Fiscal Year Ended December 31, 2009, Compared to Fiscal Year Ended December 31, 2008

Revenues were approximately $18,600,000 in Fiscal 2009, an increase of approximately $2,100,000, or 12.7%, from revenues of approximately $16,500,000 in Fiscal 2008. The increase was primarily due to the acquisition of Conesco which contributed $3,600,000, expansion of the Telco and Electric segments which contributed approximately $3,900,000 and $500,000 respectively. The Fire and Alarm/Detection segment saw a decrease of approximately $5,800,000 for the year. The decrease in Fire and Alarm/Detection was primarily related to economic conditions and the increased competition at bidding. Our management refocused their energies on different market segments in order to increase its backlog (Note F to financials).

Gross profit decreased from approximately $6,270,000 in Fiscal 2008 to approximately $6,240,000 in Fiscal 2009. This decrease of approximately $30,000, or .5%, was primarily due to the lower margins incurred by all of the new business segments. The overall margin percent decreased in 2009 from 38.2% to 33.6%. There were some heavy cost overruns in our electrical segment which had a major impact on their margin for 2009. We estimate approximately $500,000 were lost in this segment compared to expectations on the jobs that were performed. We have implemented procedures to more closely monitor and run these jobs to make sure performance matches expectations.

Combined Operating and Selling General and Administrative expenses were approximately $6,600,000 in Fiscal 2009 compared to approximately $5,900,000 for Fiscal 2008. The increase of approximately $700,000 was primarily due to the annualization of the addition of the Electrical and Telco segments, which were only a part of the 2008 numbers for the fourth quarter of 2008. This amounted to approximately $238,000 and $396,000 respectively. The addition of Conesco added approximately $495,000 of additional overhead as part of its normal operations which were not part of our company in 2008. Additional costs incurred during the year were two additional manager level accounting personnel to help with the added growth expected during 2009. We also issued stock awards to key employees as well as to members of the board of directors during 2009. These items were partially offset by the onetime expenses approximately $668,000 from acquisition costs and investor relations discussed in our annual report for December 31, 2008 on Form 10-K. With revenues falling short of management’s expectations, the benefits of these additions did not bring the operating efficiencies anticipated during 2009. During the fourth quarter of 2009, management continued its review of current costs in an effort to reduce operating overhead at all levels of the corporation. This review will continue into 2010 as our management tries to leverage its overhead in more efficient and cost effective manner to try and improve its bottom line.

Depreciation and amortization expense increased to $248,797 in Fiscal 2009 compared to $53,496 in Fiscal 2008. This increase of approximately $196,000 was primarily due to the acquisition of Conesco, Inc. and the amortization of the intangible of approximately $181,000. The balance was for new computers and leasehold improvements for the new corporate office. The remaining $3,667 of amortization related to the purchase of Jones Fire Protection was also written off in 2008.

Net interest expense increased to $114,957 in Fiscal 2009 compared to $78,743 in Fiscal 2008. This increase of approximately $36,000 was primarily due to the use of the line of credit for working capital purposes and a second term note with our bank which we did not carry in 2008. There was also a note with Conesco, which replaced their line of credit (see note M).

Income tax expense declined in 2009 due the net loss for the year offset by the 481 carryforward from Pro-Tech Fire. The section 481 carryforward (see footnote K) which was generated when Pro-Tech was forced to go from a cash basis tax payer to an accrual basis taxpayer. Prior to the merger with our company, Pro-Tech was an S-Corp and therefore all taxable income was pushed up to the owners. The net effect for 2009 is a net deferred tax liability accrual of $80,490.

LIQUIDITY AND CAPITAL RESOURCES

Fiscal Year Ended December 31, 2009, Compared to Fiscal Year Ended December 31, 2008

For the twelve months ended December 31, 2009, we experienced a net loss of $515,037. At December 31, 2009, we had $172,490 in cash. Accounts receivable, net of allowances for doubtful accounts, were $3,850,051 at the end of 2009, which at 70% of assets is approximately 21% lower than at December 31, 2008. This is primarily due to the carrying value of the intangibles from the Conesco purchase and the inventory and leasehold improvements for the new corporate facilities.

At December 31, 2009, we had working capital of $591,968 compared to working capital of $1,447,540 at December 31, 2008. The ratio of current assets to current liabilities stayed relatively the same at 1.14:1 at December 31, 2009 compared to 1.41:1 at December 31, 2008. Cash flow provided by operations during 2009 was $371,296 as compared to $61,316 at December 31, 2008. Management anticipates that its existing capital resources will be adequate to satisfy its capital requirements for the foreseeable future.

Our principal liquidity at December 31, 2009 included cash of $172,490, and $3,850,051 net accounts receivable. Management believes that our liquidity position remains sufficient enough to support on-going general administrative expense, strategic positioning, and the garnering of contracts and relationships.

Cash Flow

For the year ended December 31, 2009, we had positive cash flow from operations of $373,955 as compared to a cash flow from operations of $61,316 in 2008. This $373,955 increase is primarily due to a decrease in retention receivables and their subsequent collection of approximately $507,500 offset by inventory increase of approximately $273,000. We had an increase in investing activities during 2009. The purchases were related primarily to equipment required by our Telco segment for field testing, new computers, servers and software upgrades as well as the buildout of new office space in order to consolidate 4 separate locations our company was using during much of the year. The costs of these items amounted to approximately $276,000. No net additional financing activity took place during 2009. With the recognition of cost cutting measures and the increased backlog, management anticipates returning to profitability and positive cash flow.

Our business does not require significant amounts of investment in long-term fixed assets. The substantial majority of the capital used in our business is working capital that funds our costs of labor materials deployed in project work until our customers pay us. Our average job duration generally allows us to complete the realization of revenue and earnings in cash within a few months of invoicing.

Accordingly, we believe cash flow, by encompassing our acquisition efforts, profit margins and the use of working capital over our approximately three month working capital cycle, is an effective measure of operating effectiveness and efficiency when considered in light of our business plan for acquisitions and regional growth. Management anticipates positive cash flows from operations beginning the second quarter of 2010.

Line of Credit Facility

The line of credit facility is primarily used to fund short-term changes in working capital. The total capacity of the facility at December 31, 2009 was $900,000. Management currently believes that sufficient liquidity exists but may seek approval to increase the facility to $1.5 million in the future if considered necessary. We believe the line of credit facility provides adequate liquidity and financial flexibility to support our expected growth in fiscal 2010 and beyond.

The facility contains customary financial covenants require us to maintain certain financial ratios, including an asset coverage ratio and dollars, debt to equity ratio and a tangible net worth requirement. Non-compliance with any of these ratios or a violation of other covenants could result in an event of default and reduce availability under the facility. We are currently out of compliance with all covenants.

Long Term Notes

Long term notes with an outstanding principal balance of $517,091, were issued through our bank on February 3, 2007 and December 31, 2009. The notes were are payable over 5 years and will be paid off on or about February 1, 2012 and December 31, 2013 The notes carry interest rates of 7.76% and 5.5% respectively. These notes are held by the same bank the Company uses for its banking and where the line of credit is held. A third note, is with another bank with a current balance 110,372, was issued in June 2009 and used to replace a line of credit facility formerly held by Conesco. This note carries an interest rate of 8.0% and will be paid off in August 2013.

ITEM 7A. QUANITITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk primarily related to potential adverse changes in interest rates as discussed below. We are actively involved in monitoring exposure to market risk and continue to develop and utilize appropriate risk management techniques. We are not exposed to any other significant financial market risks including commodity price risk, foreign currency exchange risk or interest rate risks from the use of derivative financial instruments. We do not use derivative financial instruments.

We have limited exposure to changes in interest rates under our revolving credit facility. We have a debt facility under which we may borrow funds in the future. We do not currently foresee any borrowing needs. Our debt with fixed interest rates consists of notes to former owners of acquired companies.

The following table presents principal amounts (stated in thousands) and related average interest rates by year of maturity for our debt obligations and their indicated value at December 31, 2009:

For the twelve months ended December 31,

	2010			2011			2012			2013			Fair Value
Fixed Rate Debt	$	213		$	227		$	131		$	56		$	627
Average Interest Rate		8.7	%		10.4	%		6.8	%		5.3	%

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

PRO-TECH INDUSTRIES, INC.

Index to Financial Statements

		Page
Report of Independent Registered Public Accounting Firm		F-3
Consolidated Balance Sheets as of December 31, 2009 and 2008		F-4
Consolidated Statement of Operations for the years ended December 31, 2009 and 2008		F-5
Consolidated Statement of Stockholders’ Equity for the two years ended December 31, 2009		F-6
Consolidated Statement of Cash Flows for the years ended December 31, 2009 and 2008		F-7
Notes to Consolidated Financial Statements		F-8 ~ F-21

F-2

RBSM LLP

Certified Public Accountants

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors

Pro-Tech Industries, Inc.

Sacramento, California

We have audited the accompanying consolidated balance sheets of PRO-TECH INDUSTRIES, INC., (the “Company”) as of December 31, 2009 and 2008 and the related consolidated statement of income, stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2009. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based upon our audits.

We have conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2009 and 2008, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2009, in conformity with accounting principles generally accepted in the United States of America.

/s/RBSM LLP

New York, New York

April 14, 2010

F-3

PRO-TECH INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEETS

December 31, 2009 and 2008

	2009			2008
ASSETS
Current Assets:
Cash and cash equivalents	$	172,490		$	86,895
Contract receivable, net of allowance for doubtful accounts as of December 31, 2009 and 2008, of $60,000 and $110,000, respectively (Note D)		3,850,051			4,638,401
Costs and estimated earnings in excess of billings (Note E)		306,073			146,338
Note receivable – related party		77,000			142,543
Inventory		273,968			0
Other current assets		155,386			87,963
Total current assets		4,834,968			5,102,140

Property and equipment: (Note H)		874,041			587,373
Less: accumulated depreciation		571,394			504,028
Net property and equipment		302,647			83,345

Other Assets:
Intangibles, net of accumulated amortization as of December 31, 2009 and 2008, of $181,431 and $20,000, respectively (Note I)		102,548			-
Goodwill		331,075			-
Deposits		10,856			10,856
Total assets	$	5,582,094		$	5,196,341

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses (Note J)		2,713,840		$	1,945,178
Notes payable – others –current portion (Note M)		213,394			172,025
Accruals on uncompleted contracts (Note E)		244,763			712,252
Reserve for loss on uncompleted contracts		90,514			20,995
Deferred tax liability (Note L)		80,490			110,150
Line of credit (Note K)		900,000			655,500
Total current liabilities		4,243,000			3,616,100

Long -Term Liabilities:
Notes payable- others – long term portion (Note M)		414,071			518,030
LT Deferred tax liability (Note L)		-			148,650
Total long term liabilities		414,071			666,680

Commitments and contingencies (Note P)		-			-

Stockholders' Equity: (Note N)
Common Stock, $0.001 par value; 70,000,000 shares authorized; 18,593,880 shares issued and outstanding at December 31, 2009 14,600,000 shares issued and outstanding at December 31, 2008		18,594			14,600
Paid in capital		1,421,467			898,961
Accumulated deficit		(515,038	)		-
Total stockholders’ equity		925,023			913,561

Total liabilities and stockholders' equity	$	5,582,094		$	5,196,341

The accompanying notes are an integral part of these consolidated financial statements

F-4

PRO-TECH INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF INCOME

FOR THE YEARS ENDED

DECEMBER 31, 2009 AND 2008

	2009			2008
Net revenue	$	18,609,920		$	16,487,525
Cost of sales		12,364,059			10,213,866
Gross profit		6,245,861			6,273,659

Operating Expenses:
Selling, general and administrative		6,572,046			5,871,041
Depreciation and amortization (Note H & I)		248,797			53,496
Total Operating Expenses		6,820,843			5,924,537

Income from Operations		(574,982	)		349,122

Other Income (Expense):
Interest income(expense), net		(114,957	)		(78,744	)
Total Other Expenses		(114,957	)		(78,744	)
Income before income taxes		(689,939	)		270,378

Income (taxes) Benefit (Note L)		174,902			(263,800	)

Net Income (loss)	$	(515,037	)	$	6,578

Net income (loss) per common share (Note C):
Basic	$	(0.03	)	$	0.00
Diluted	$	(0.03	)	$	0.00
Weighted average common shares outstanding		17,766,190			10,100,000

The accompanying notes are an integral part of these consolidated financial statements

F-5

PRO-TECH INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

FOR THE TWO YEARS ENDED DECEMBER 31, 2009

	Common Stock
	Common Shares		Amount		Paid in Capital		Accumulated Deficit			Total Stockholders’ Equity
Balance at January 1, 2008		10,100,000	$	10,100	$	541	$	1,191,842		$	1,202,483

Dividend distributions (Note O)		-		-		-		(426,000	)		(426,000	)
Shares reissued to existing MMBW shareholders		3,500,000		3,500		-		-			3,500
Reclassification of paid in capital on revocation of S corporation tax status upon reverse merger		-		-		772,420		(772,420	)		-
Issuance of shares for services		1,000,000		1,000		126,000		-			127,000
Net income		-		-		-		6,578			6,578

Balance at December 31, 2008		14,600,000	$	14,600	$	898,961	$	-		$	913,561

Shares issued for purchase of Conesco, Inc. at $0.127 (Note N)		3,000,000		3,000		378,000		-			381,000
Shares issued to key employees @ $0.144 (Note N)		963,880		964		47,036		-			48,000
Shares issued to Board of Directors @ $3.25 (Note N)		30,000		30		97,470		-			97,500
Net loss		-		-		-		(515,038	)		(515,038	)
Balance at December 31, 2009		18,593,880	$	18,594	$	1,421,467	$	(515,038	)	$	925,023

The accompanying notes are an integral part of these consolidated financial statements

F-6

PRO-TECH INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

	2009			2008
Cash Flows From Operating Activities:
Net income (loss) from operations	$	(515,038	)	$	6,578
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		248,797			53,496
Bad debt write off		122,161			9,302
Accrual for bad debt allowance		(50,000	)		110,000
Deferred tax liability, net (Note L)		(178,310	)		258,800
Stock issued to previous MMBW shareholders		-			3,500
Stock issued to employees and board of directors		145,500			-
Stock issued for services		-			127,000
Accruals (reversal) of loss against uncompleted contracts		69,519			(44,205	)
(Increase) decrease in:
Contract receivable		905,456			(817,443	)
Inventory		(273,968	)		-
Other current assets, net		1,238			(172,306	)
Costs and estimated earnings in excess of billings		(22,730	)		240,499
Billings in excess of costs and estimated earnings		(467,489	)		40,562
Increase (decrease) in:
Accounts payable and accrued expenses, net		392,484			245,532
Net Cash Provided by Operating Activities		373,955			61,316

Cash Flows From Investing Activities:
Purchase of Conesco, Inc.		9,043			-
Purchase of property and equipment		(279,155	)		(26,023	)
Net Cash Used In Investing Activities		(270,112	)		(26,023	)

Cash Flows From Financing Activities:
Payments for dividend distributions (Note N)		-			(426,000	)
Proceeds from long term debt		120,000			250,000
Payments of long term debt		(382,748	)		(172,050	)
Net proceeds from line of credit		244,500			389,000
Net Cash (Used) provided by Financing Activities		(18,248	)		40,950

Net Increase in Cash And Cash Equivalents		85,595			76,243

Cash and cash equivalents at beginning of year		86,895			10,653
Cash and cash equivalents at the end of year	$	172,490		$	86,895

Supplemental Disclosures of Cash Flow Information:
Cash paid during period for interest	$	95,408		$	83,743
Cash paid during period for taxes	$	-		$	-

The accompanying notes are an integral part of these consolidated financial statements

F-7

PRO-TECH INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

(continued)

	2009			2008
Non-cash Investing and Financing Activities:
Acquisition costs in reverse merger	$	-		$	3,500
Shares issued for compensation	$	145,500		$	-
Acquisition:
Current assets acquired	$	338,435		$	-
Equipment and other assets acquired		6,505			-
Intangible assets acquired		615,054			-
Liabilities assumed		(578,994	)		-
Shares issued as consideration	$	381,000		$	-

The accompanying notes are an integral part of these consolidated financial statements

F-8

PRO-TECH INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2009 and 2008

NOTE A - SUMMARY OF ACCOUNTING POLICIES

A summary of the significant accounting policies applied in the preparation of the accompanying consolidated financial statements follows.

Business and Basis of Presentation

The Company serves the new construction market, as well as customers retro-fitting, upgrading or repairing their existing facilities, bringing existing facilities to current standards (for example, installing sprinklers at a customer’s expanded storage warehouse, etc.).

In late third quarter and fourth quarter 2008, the Company expanded its services to include electrical and telecommunications. The client base is the same as the fire sprinkler services. These groups were not a significant part of the business reported in the 2008 consolidated financial statements.

NOTE B - MERGER AND CORPORATE RESTRUCTURE

On December 31, 2008, the stockholders of Pro-Tech Fire Protection Systems Corp. (“Pro-Tech”) entered into an agreement for the exchange of common stock (“Acquisition Agreements”, “the Transaction”, or “Merger”) with the Company. The Company had a total of 70,000,000 authorized shares with a par value of $0.001 per share and 3,500,000 shares issued and outstanding as of December 31, 2008.

The Company’s yearend for accounting purposes was December 31, 2008. As a result of the Merger, there was a change in control of the public entity. In accordance with Statement of Financial Accounting Standards 141, Pro-Tech is deemed to be the acquiring entity. While the transaction is accounted for using the purchase method of accounting, in substance the Merger is a recapitalization of Pro-Tech’s capital structure

For accounting purposes, the Company accounted for the transaction as a reverse acquisition and Pro-Tech is the surviving entity. The total purchase price and carrying value of net assets acquired was $3,500. The Company did not recognize goodwill or any intangible assets in connection with the transaction. As of the date of the Agreement, the Company was an inactive corporation with no significant assets and liabilities.

Effective with the Acquisition Agreements, all previously outstanding common stock owned by Pro-Tech’s stockholders were exchanged for an aggregate of 10,100,000 shares of the Company’s common stock, $0.001 par value (“the Common Stock”). As part of the Transaction it was agreed that, all outstanding shares would remain outstanding. The effect of the Transaction was that 3,500,000 shares of Common Stock would be retained.

The value of the stock issued was the historical cost of the Company's net tangible assets of $3,500, which did not differ materially from their fair value. The total consideration paid of $3,500 is summarized further below.

F-9

	December 31, 2008
Common stock retained	$	3,500
Assets acquired		(-	)
Liabilities assumed		-
Total consideration paid	$	3,500

In accordance with Statement of Position 98-5 (“SOP 98-5”), the Company expensed $3,500 as organization costs.

NOTE C - SUMMARY OF ACCOUNTING POLICIES

Revenue Recognition

The Company recognizes revenues from fixed-price and modified fixed-price construction contracts on the percentage-of-completion method, measured by the percentage of cost incurred to date to estimated total cost for each contract. That method is used because management considers total cost to be the best available measure of progress on the contracts. Because of inherent uncertainties in estimating costs, it is at least reasonably possible that the estimates used will change within the near term. The Company also recognizes revenue from non-fixed price (time and materials) contracts. The revenue from these contracts is billed monthly and is based on actual time and material costs which have occurred on the job for the billing period.

Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs, and depreciation. Selling, general, and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability may result in revisions to costs and income, which are recognized in the period in which the revisions are determined. Changes in estimated job profitability resulting from job performance, job conditions, contract penalty provisions, claims, change orders, and settlements, are accounted for as changes in estimates in the current period.

Revenue on contracts can be derived from different disciplines and is accounted for on a consolidated basis by job to see overall performance, as well as the ability to break the job down by discipline to see how each contributes to the overall performance of the job.

The asset, “Costs and estimated earnings in excess of billings on uncompleted contracts,” represents revenues recognized in excess of amounts billed. The liability, “Billings in excess of costs and estimated earnings on uncompleted contracts,” or “accruals on uncompleted contracts” represents billings in excess of revenues recognized.

Contract Receivables

Contract receivables are recorded when invoices are issued and are presented in the balance sheet net of the allowance for doubtful accounts. Contract receivables are written off when they are determined to be uncollectible. The allowance for doubtful accounts is estimated based on the Company’s historical losses, the existing economic conditions in the construction industry, and the financial stability of its customers.

Inventory

The Company maintains an inventory which primarily consists of small parts such as sprinkler heads, gaskets, pipe joints, junction boxes, outlets, etc. which comes from come from closed jobs or economical buying opportunities. They get used for repair work or filler when jobs run short. The inventory on hand was $273,968 and $0 at December 31, 2009 and 2008, respectively.

F-10

Advertising

The Company follows the policy of charging the costs of advertising to expenses incurred. The Company incurred $30,912 and $35,694, of advertising costs for the years ended December 31, 2009 and 2008, respectively.

Income Taxes

In accordance with Accounting Standards Codification subtopic 740-10, Income Taxes (“ASC 740-10”) deferred income taxes are the result of the expected future tax consequences of temporary differences between the financial statement and tax basis of assets and liabilities. Generally, deferred income taxes are classified as current or non-current in accordance with the classification of the related asset or liability. Items that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. A valuation allowance is provided against deferred income tax assets in circumstances where management believes the recoverability of a portion of the assets is not reasonably assured. Losses incurred, if any, are carried forward as applicable Accounting Standards Codification subtopic 740-10, Income Taxes (“ASC 740-10”) and the Internal Revenue Code and potentially may be used to offset taxable net income generated in the future. The Company had previously elected to be treated as a subchapter “S” corporation for federal tax purposes. The reverse merger caused the Company to lose its subchapter “S” corporation status. The Company became responsible for $849,628 in deferred income that carried forward from 2007 when Pro-Tech was forced to change from cash to accrual based taxpayer. Pro-Tech took a 481a election to spread the acceleration over 4 years. The Company provides for income taxes based on pre-tax earnings reported in the consolidated financial statements. Certain items such as depreciation are recognized for tax purposes in periods other than the period they are reported in the consolidated financial statements. Following the reverse merger status, beginning, January 1, 2009, the Company became a C-Corp and subject to standard quarterly taxes provisions. Results of operations may not be comparable to prior results.

Basic and diluted earnings per share

In accordance with SFAS No. 128 – “Earnings Per Share”, the basic and diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding. Diluted net earnings per share is computed similar to basic earnings per share except that the denominator is adjusted for the potential dilution that could occur if stock options, warrants, and other convertible securities were exercised or converted into common stock. The Company does not have any common stock equivalents at December 31, 2009 and 2008.

Cash Equivalents

For purposes of the Statements of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity date of three months or less to be cash equivalents.

Property and Equipment

Property and equipment are stated at cost and depreciated over their estimated useful lives of 3 to 10 years using the straight-line method as follows:

Construction equipment	5-7years
Automobiles	5 years
Computer Software	3 years
Office equipment and furniture	3-7years
Leasehold improvements	life of the lease agreement where appropriate

Maintenance and repairs to automobiles, equipment, furniture and computers is expensed as incurred. There is no reevaluation of useful life as most of the assets are short term in nature and the repairs or maintenance are in the normal course of the operating life of the asset. Upon disposal of assets, the Company reduces the asset account and the accumulated depreciation account for the balances at that point in time. The difference between the amounts received greater than the book value is recognized as a gain and if the amount is less than the book value is recognized as a loss. Depreciation is not included in cost of goods sold.

F-11

Long-Lived Assets

The Company has adopted Accounting Standards Codification subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”). ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should any impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. ASC 360-10 also requires assets to be disposed of be reported at the lower of the carrying amount or the fair value less costs to sell.

Concentrations of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and receivables. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. The Company periodically reviews its contract receivables in determining its allowance for doubtful accounts. The allowance for doubtful accounts was $60,000 and $110,000 as of December 31, 2009 and 2008, respectively.

Basic and Diluted Earnings (Loss) Per Share

Basic and diluted income or loss per common share is based upon the weighted average number of common shares outstanding during the three and nine months ended September 30, 2009 and 2008, under the provisions of Accounting Standards Codification subtopic 260-10, Earnings Per Share (“ASC 260-10”), “Earnings Per Share” and as amended/superseded in “Compensation” (“ASC 718-10”). As the Company had net loss for the twelve months ended December 31, 2009 and net income for the twelve month periods ended December 31, 2008. The Company did not have any common stock equivalent issued or outstanding as of December 31, 2009 or for any other earlier period. Non-vested shares have been excluded as common stock equivalents in the diluted earnings per share because they are either anti-dilutive, or their effect is not material.

Stock Based Compensation

The Company adopted Accounting Standards Codification subtopic 718-10, Compensation (“ASC 718-10”), Accounting for Stock-Based Compensation, to account for compensation costs under our stock option plans. In adopting ASC 718-10, company elected to use the modified prospective method to account for the transition from the intrinsic value method to the fair value recognition method. Under the modified prospective method, compensation cost is recognized from the adoption date forward for all new stock options granted and for any outstanding unvested awards as if the fair value method had been applied to those awards as of the date of grant. We had no outstanding unvested awards at the adoption date or earlier period. The Company uses the fair value method for equity instruments granted to non-employees and uses the Black Scholes model for measuring the fair value. The stock based fair value compensation is determined as of the date of the grant or the date at which the performance of the services is completed (measurement date) and is recognized over the periods in which the related services are rendered.

Comprehensive Income

The Company adopted Accounting Standards Codification subtopic 220-10, Comprehensive Income (“ASC 220-10”). ASC 220-10 establishes standards for the reporting and displaying of comprehensive income and its components. Comprehensive income is defined as the change in equity of a business during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. ASC 220-10 requires other comprehensive income (loss) to include foreign currency translation adjustments and unrealized gains and losses on available for sale securities.

F-12

Segment Information

Accounting Standards Codification subtopic Segment Reporting 280-10 (“ASC 280-10”) establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. ASC 280-10 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions how to allocate resources and assess performance. The information disclosed herein materially represents all of the financial information related to the Company’s principal operating segment.

Use of Estimates

The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly actual results could differ from those estimates.

Fair Value

In January 2008, the Company adopted the Accounting Standards Codification subtopic 825-10, Financial Instruments (“ASC 825-10”) which defines fair value for accounting purposes, establishes a framework for measuring fair value and expands disclosure requirements regarding fair value measurements. The Company’s adoption of ASC 825-10 did not have a material impact on its consolidated financial statements. Fair value is defined as an exit price, which is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. The degree of judgment utilized in measuring the fair value of assets and liabilities generally correlates to the level of pricing observability. Financial assets and liabilities with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in active markets generally have more pricing observability and require less judgment in measuring fair value. Conversely, financial assets and liabilities that are rarely traded or not quoted have less price observability and are generally measured at fair value using valuation models that require more judgment. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency of the asset, liability or market and the nature of the asset or liability. At December 31, 2009 and December 31, 2008 the Company did not have any financial assets measured at fair value on a recurring basis.

Reclassifications

Certain reclassifications have been made to conform prior period data to the current presentation. These reclassifications had no effect on reported income.

New Accounting Pronouncements

In January 2010, the FASB issued FASB ASU 2010-06, “Improving Disclosures about Fair Value Measurements”, which clarifies certain existing disclosure requirements in ASC 820 as well as requires disclosures related to significant transfers between each level and additional information about Level 3 activity. FASB ASU 2010-06 begins phasing in the first fiscal period after December 15, 2009. The Company is currently assessing the impact on its consolidated results of operations and financial condition.

In January 2010, the FASB issued Update No. 2010-04 “Accounting for Various Topics—Technical Corrections to SEC Paragraphs” (“2010-04”). 2010-04 represents technical corrections to SEC paragraphs within various sections of the Codification. Management is currently evaluating whether these changes will have any material impact on its financial position, results of operations or cash flows.

In January 2010, the FASB issued Update No. 2010-01 “Accounting for Distributions to Shareholders with Components of Stock and Cash—a consensus of the FASB Emerging Issues Task Force” (“2010-03”) an update of ASC 505 “Equity.” 2010-03 clarifies the treatment of stock distributions as dividends to shareholders and their affect on the computation of earnings per shares. The Company has not and does not intend to declare dividends for preferred to common stock holders. Management does not expect adoption of this standard to have any material impact on the Company’s financial position, results of operations or operating cash flows.

F-13

New Accounting Pronouncements (continued)

FASB ASC TOPIC 860 - "Accounting for Transfer of Financial Assets and Extinguishment of Liabilities." In June 2009, the FASB issued additional guidance under Topic 860 which improves the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor's continuing involvement, if any, in transferred financial assets. This additional guidance requires that a transferor recognize and initially measure at fair value all assets obtained (including a transferor's beneficial interest) and liabilities incurred as a result of a transfer of financial assets accounted for as a sale. Enhanced disclosures are required to provide financial statement users with greater transparency about transfers of financial assets and a transferor's continuing involvement with transferred financial assets. This additional guidance must be applied as of the beginning of each reporting entity's first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Earlier application is prohibited. This additional guidance must be applied to transfers occurring on or after the effective date. The adoption of this Topic is not expected to have a material impact on the Company's financial statements and disclosures.

In October 2009, the FASB issued FASB ASU No. 2009-13, Revenue Recognition (Topic 605): “Multiple Deliverable Revenue Arrangements – A Consensus of the FASB Emerging Issues Task Force.” This standard provides application guidance on whether multiple deliverables exist, how the deliverables should be separated and how the consideration should be allocated to one or more units of accounting. This update establishes a selling price hierarchy for determining the selling price of a deliverable. The selling price used for each deliverable will be based on vendor-specific objective evidence, if available, third-party evidence if vendor-specific objective evidence is not available, or estimated selling price if neither vendor-specific or third-party evidence is available. ASU 2009-13 may be applied retrospectively or prospectively for new or materially modified arrangements in fiscal years beginning on or after June 15, 2010, with early adoption permitted. The Company is currently assessing the impact on its consolidated financial position and results of operations

In February 2010, the FASB issued FASB ASU 2010-09, Subsequent Events, Amendments to Certain Recognition and Disclosure Requirements, which clarifies certain existing evaluation and disclosure requirements in ASC 855 related to subsequent events. FASB ASU 2010-09 requires SEC filers to evaluate subsequent events through the date in which the financial statements are issued and is effectively immediately. The new guidance does not have an effect on the Company’s consolidated results of operations and financial condition.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on the Company’s present or future consolidated financial statements.

NOTE D – CONTRACT RECEIVABLES

Contract receivables at December 31, 2009 and 2008 consist of the followings:

	2009			2008
Contracts receivables	$	3,245,701		$	3,576,558
Retention receivables		664,350			1,171,843
Less: Allowance for doubtful Accts		(60,000	)		(110,000	)
	$	3,850,051		$	4,638,401

F-14

NOTE E – UNCOMPLETED CONTRACTS

At December 31, 2009 and 2008, costs, estimated earnings, and billings on uncompleted contracts are summarized as follows:

	2009			2008
Costs incurred to date on uncompleted contracts	$	19,169,775		$	9,987,580
Estimated earnings		3,422,931			1,103,017
		22,592,706			11,090,597
Less: billed revenue to date		(22,531,396	)		(11,656,510	)
	$	61,310		$	(565,914	)

Costs and estimated earnings in excess of billings	$	306,073		$	146,338
Less: accruals on uncompleted contracts		(244,763	)		(712,252	)
	$	61,310		$	(565,914	)

NOTE F – BACKLOG

The following schedule summarizes changes in backlog on contracts from January 1, 2008 through December 31, 2009. Backlog represents the amount of revenue the Company expects to realize from work to be performed on uncompleted contracts in progress at year end and from contractual agreements on which work has not yet begun.

Backlog balance at January 1, 2008	$	8,453,476
New contracts for the year ended December 31, 2008		7,861,663
Add: contract adjustments		4,262,278
Less: revenue for the year ended December 31, 2008		(16,487,525	)
Backlog balance at December 31, 2008	$	4,089,892
New contracts for the year ended December 31, 2009		23,556,981
Add: contract adjustments		1,672,307
Less: revenue for the year ended December 31, 2009		(18,609,920	)
Backlog balance at December 31, 2009	$	10,709,260

NOTE G – INVENTORY

Major holdings of inventory at December 31, 2009 and 2008 consist of the followings:

	2009		2008
Sacramento Fire & Alarm Detection	$	106,695	$	-
San Diego Fire & Alarm Detection		44,700		-
Electrical		48,844		-
Flooring Segment		73,729		-
	$	273,968	$	-

NOTE H – PROPERTY AND EQUIPMENT

Major classes of property and equipment at December 31, 2009 and 2008 consist of the followings:

	2009			2008
Vehicles	$	196,948		$	196,948
Leasehold improvements		232,629			57,973
Office equipments		215,792			160,185
Tools and other equipment		228,672			172,267
		874,041			587,373
Less: accumulated depreciation		(571,394	)		(504,028	)
Net Property and Equipment	$	302,647		$	83,345

F-15

NOTE H – PROPERTY AND EQUIPMENT (continued)

Depreciation expense was $67,366 and $49,829 for the years ended December 31, 2009 and 2008, respectively.

During the years ended December 31, 2009 and 2008, the Company wrote off assets with a gross acquisition value of $0 and $33,597 and net book values of $0 and $0, respectively. All of these assets were obsolete computers and software.

NOTE I – INTANGIBLE ASSETS AND GOODWILL

Total identifiable intangible assets acquired and their carrying values at December 31, 2008 are:

										Weighted
	Gross		Accumulated							Average
	Carrying		Amortization/					Residual		Amortization
	Amount		Impairment			Net		Value		Period (Years)
Amortized Identifiable Intangible Assets: Jones Fire non compete	$	20,000	$	(20,000	)	$	-		-		5.0
Total Amortized identifiable Intangible Assets		20,000		(20,000	)		-				5.0
Total	$	20,000	$	(20,000	)	$	-	$	-

Total identifiable intangible assets acquired and their carrying values at December 31, 2009 are:

										Weighted
	Gross		Accumulated							Average
	Carrying		Amortization/					Residual		Amortization
	Amount		Impairment			Net		Value		Period (Years)
Intangible Assets and Goodwill:
Amortized Identifiable Intangible Assets: Conesco backlog, customer lists	$	283,979	$	(181,431	)	$	102,548	$	-		1.5
Total Amortized identifiable Intangible Assets		283,979		(181,431	)		102,548				1.5
Goodwill - Conesco		331,075		-			331,075		-
Total	$	615,054	$	(181,431	)	$	433,623	$	-

Total amortization expense charged to operations for the year ended December 31, 2009 and 2008 was $181,431 and $3,667, respectively. Estimated amortization expense as of December 31, 2009 is as follows:

Years Ended December 31,
2010	$	102,548
Total	$	102,548

The Company does not amortize goodwill. The Company recorded goodwill in the amount of $331,075 as a result of the acquisitions of Conesco, Inc. during the year ended December 31, 2009. The Company evaluates goodwill for impairment based on the fair value of the operating business units to which this goodwill relates at least once a year. The Company generally determines the fair value of a reporting unit using a combination of the income approach, which is based on the present value of estimated future cash flows, and the market approach, which compares the business unit's multiples to its competitors. At December 31, 2009, the Company has determined that the value of Conesco’s goodwill is fairly valued .

The estimated fair value of our goodwill could change if the Company is unable to achieve operating results at the levels that have been forecasted, the market valuation of our business decreases based on transactions involving similar companies, or there is a permanent, negative change in the market demand for the services offered by the Company. These changes could result in a further impairment of the existing goodwill balance that could require a material non-cash charge to our results of operations.

F-16

On January 16, 2009, the Company entered in to an agreement for the exchange of common stock (“merger”) with the shareholders of Conesco (“Conesco Shareholders”) and Conesco, Inc. (“Conesco”). The Company issued 3,000,000 restricted shares of its common stock valued at $381,000 in exchange for all outstanding shares of Conesco. Conesco became a wholly owned subsidiary of the Company.

The total purchase price and carrying value of net assets acquired was $381,000. The Company recognized customer list as intangible assets in connection with the transaction. At the time of the acquisition, there was no active market for the Company’s common stock. As a result, the Company’s management estimated the fair value of the shares issued based on a valuation model, which management believes approximates the fair value of the net assets acquired.

In accordance with Financial Accounting Standard (SFAS) No. 141, Business Combinations, the total purchase price was allocated to the estimated fair value of assets acquired and liabilities assumed. The estimate of fair value of the assets acquired was based on management’s estimates. The Company plans to utilize a valuation specialist to re-estimate these values in the near future and accordingly, these value estimates may change in the near future. The total purchase price was allocated to the assets and liabilities acquired as follows:

Cash and other current assets	$	338,435
Equipment and other assets		6,505
Intangible assets		615,054
Liabilities		(578,994	)
Total purchase price	$	381,000

Intangibles of $615,054 represented the excess of the purchase price over the fair value of the net tangible assets acquired. The Company will amortize the intangibles over 5 years and will review the value of the intangibles to account for any possible impairment as per guidance in SFAS 142 during the twelve months ended December 31, 2009 and beyond until the value of the asset is deemed impaired.

The following data presents unaudited pro forma revenues, net loss and basic and diluted net loss per share of common stock for the Company as if the acquisitions discussed above, had occurred on January 1, 2008. The Company has prepared these pro forma financial results for comparative purposes only. These pro forma financial results may not be indicative of the results that would have occurred if the Company had completed these acquisitions at the beginning of the periods shown below or the results that will be attained in the future.

	Year Ended December 31, 2008
	As Reported		Pro Forma Adjustments			Pro Forma
Revenues	$	16,487,525	$	1,016,187		$	17,503,712
Net income (loss)	$	6,578	$	(123,681	)	$	(117,103	)
Net loss per common share outstanding - basic & diluted	$	.00	$	.00		$	(.01	)
Weighted average common shares outstanding - basic & diluted		10,100,000					10,100,000

F-17

NOTE J – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at December 31, 2009 and 2008:

	2009			2008
Accounts payable	$	2,674,443		$	1,741,225
Accrued payroll and vacation		(16,343	)		187,826
Accrued payroll taxes		74			1,247
Other liabilities		55,666			14,880
Total	$	2,713,840		$	1,945,178

NOTE K – BANK LINE OF CREDIT

The Company has a line of credit with Westamerica Bank in the amount of $1,000,000. The line of credit is secured by substantially all of the assets of the Company and guaranteed by the Company’s principal stockholders. In addition, entities owned and controlled by the Company’s principal stockholders are co-makers of the line of credit and have pledged substantially all of the assets as security for the line of credit (see Note N). The line of credit bears interest at the Bank minus 0.5%, per annum, with interest due and payable monthly and expires on June 30, 2010. The balance outstanding under the line of credit at December 31, 2009 and 2008 amounted to $900,000 and $655,500 respectively, leaving a balance available on the line of $100,000 and $294,500, respectively. The Company is required to maintain certain bank loan covenants. At December 31, 2009, the Company was not in compliance with certain bank loan covenants.

NOTE L – DEFERRED TAXES

ASC 740-10 requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

On January 1, 2007, the Pro-Tech changed from cash basis to accrual basis for the recognition of income taxes. The Company elected to pro-rate the initial tax catch up over 4 years as allowed by Section 481. At December 31, 2009, the Company had for federal income tax purposes a net deferred tax liability of $80,490.

Components of the net deferred tax liability is as follows:

	Year Ended December 31,		Year Ended December 31,
	2009		2008
Deferred tax assets
Allowances	$	23,964	$	38,500
Timing difference on amortization of intangibles		65,217		-
Total gross deferred tax assets	$	89,181	$	38,500

Deferred tax liabilities
Section 481 carryforward	$	169,671	$	297,300
Total gross deferred tax liabilities	$	169,671	$	297,300

Net deferred tax liability	$	80,490	$	258,800

The federal and state income tax provision (benefit) is as follows:

	Year Ended December 31,
	2009			2009
Current:
Federal	$	-			-
State		3,408			5,000
Total current		3,408			5,000

Deferred:
Federal		(178,310	)		258,800
State		-			-
Total deferred		178,310			258,800

Total tax provision (benefit)	$	174,902			263,800

The effective income tax rate remains the statutory rate primarily due to the benefit of the current year loss offsetting the deferred tax liability. This resulted in no significant increase or decrease in tax provision.

F-18

NOTE M – NOTES PAYABLE

Notes payable at December 31, 2009 and 2008 are as follows:

	2009			2008
Note payable to Bank, interest at 7.76% per annum; secured by substantially all of the Company’s assets; with monthly principal and interest payments of $13,133.99, due February, 2012. The Note is guaranteed by the Company’s principal stockholders. In addition, entities owned and controlled by the Company’s principal stockholders are co-makers of the Note and have pledged substantially all of their assets as security for the Note (see Note N).	$	312,009		$	440,055
Note payable to Bank, interest at 5.5% per annum; secured by substantially all of the Company’s assets; with monthly principal and interest payments of $4,785.24, due December, 2013. The Note is guaranteed by the Company’s principal stockholders. In addition, entities owned and controlled by the Company’s principal stockholders are co-makers of the Note and have pledged substantially all of their assets as security for the Note (see Note N).		205,083			250,000
Note payable to Bank, interest at 8.0% per annum; secured by substantially all of the Conesco assets; with monthly principal and interest payments of $3,766.86, due August, 2012. The Note is guaranteed by the Company’s principal stockholders.		110,373			-
Total note payable		627,465			690,055
Less: current portion		(213,394	)		(172,025	)
Notes payable – long term	$	414,071		$	518,030

Aggregate maturities of long-term debt as of December 31, 2009 are as follows:

Year ended	Amount
December 31, 2010	$	213,194
December 31, 2011		227,299
December 31, 2012		131,141
December 31, 2013		55,831
Total	$	627,465

NOTE N – CAPITAL STOCK

The Company is authorized to issue 70,000,000 shares of common stock with $0.001 par value per share. As of December 31, 2009 and December 31, 2008, the Company had 18,593,880 and 14,600,000 shares of common stock issued and outstanding, respectively.

During the twelve months ended December 30, 2009 and 2008, the Company distributed dividends to the owner’s, while still a private company (2008), totaling $0 and $426,000, respectively.

On January 16, 2009, the Company issued 3,000,000 shares of common stock valued at $381,000 for the purchase of Conesco, Inc. (see Note H above).

On January 19, 2009, the Company issued 1,000,000 shares of common stock valued at $144,000 as compensation.

On May 28, 2009, the Company issued 30,000 shares to its board of directors valued at $97,500 as compensation.

NOTE O - RELATED PARTY TRANSACTIONS

Two stockholders of the Company are co-owners of an entity that provides charter air services, and on occasion, the Company utilizes this entity for air travel services in connection with the Company’s contracting. During the years ended December 31, 2009 and 2008, the Company incurred and charged to operations $103,376 and $167,949, respectively, in connection with air travel services provided by the entities to the Company. There were no payables owed to the entities at December 31, 2009 and 2008, respectively.

The entities are co-makers of a line of credit and a note payable and have pledged substantiality all of their assets to secure the line of credit (See Note J) and note payable (see Note L).

F-19

NOTE P - COMMITMENTS AND CONTINGENCIES

Operating Lease Commitments

The Company leases office space under non-cancelable operating leases that expire through December 2012.

The Company also leases vehicles from Enterprise Fleet Services under non-cancelable operating leases expiring through March 2013.

Future minimum lease payments for the above leases over the next four years are as follows:

2010	$	325,090
2011		196,149
2012		20,299
2013		8,718
Total	$	550,256

For the years ended December 31, 2009 and 2008, rent expense was $207,609 and $122,840, respectively. For the years ended December 31, 2009 and 2008, vehicle lease expense was $240,525 and $272,912, respectively.

Litigation

In September 2009, the Pro-Tech Fire Protection Systems Corp was named in a suit by a local bank. The Company believes that it has meritorious defenses to the plaintiff’s claims and intends to vigorously defend itself against the Plaintiff’s claims. Management believes the ultimate outcome of this matter will not have a material adverse effect on the Company’s consolidated financial position or results of operations. The Company will seek recourse for any costs it incurs in defending itself against this claim.

Surety Bonds

A certain number of our construction projects require us to maintain a surety bond. The bond surety company requires additional guarantees for issuance of the bonds. The two officers (former owners) of Pro-Tech have both personally guaranteed these bonds. There is currently not remuneration to the officers for these guarantees.

NOTE Q – SEGMENT INFORMATION

The Company is managed by specific lines of business including fire protection and alarm and detection, electrical, telecommunications and flooring. The Company’s management makes financial decisions and allocates resources based on the information it receives from its internal management system on each of its lines of business. Certain other expenses associated with the public company status are reported at the Meltdown parent company level, not within the subsidiaries. These expenses are reported separately in this footnote. The Company’s management relies on the internal management system to provide sales and cost information by line of business.

Summarized financial information by line of business for the twelve months ended December 31, 2009 and December 31, 2008, as taken from the internal management system previously discussed, is listed below. Information for the twelve months ended December, 2008 does not include any data from flooring and minimal data from electrical and telecommunications or flooring, as those acquisitions/startups were not completed by those dates.

Revenue	Twelve months ended
	Dec 31, 2009		Dec 31, 2008
Fire Protection/Alarm & Detection	$	9,342,000	$	15,193,000
Telecommunications		4,282,000		443,000
Flooring		3,622,000		-
Electrical		1,364,000		852,000
Total	$	18,610,000	$	16,488,000

F-20

Gross Profit
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	4,553,000		$	5,642,000
Telecommunications		1,026,000			283,000
Flooring		890,000			-
Electrical		(223,000	)		349,000
Total	$	6,246,000		$	6,274,000

Operating Income (Loss)
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	620,000		$	2,012,000
Telecommunications		543,000			204,000
Flooring		419,000			-
Electrical		(506,000	)		305,000
Corporate		(1,651,000	)		(2,487,000	)
Total	$	(575,000	)	$	349,000

Depreciation/Amortization
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	41,000		$	41,000
Telecommunications		8,000			-
Flooring		3,000			-
Electrical		1,000			-
Corporate		195,000			12,000
Total	$	248,000		$	53,000

Interest
	Twelve months ended
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	-		$	5,000
Telecommunications		-			-
Flooring		21,000			-
Electrical		-			-
Corporate		95,000			74,000
Total	$	116,000		$	79,000

Assets
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	2,435,000		$	5,196,341
Telecommunications		609,000			-
Flooring		1,059,000			-
Electrical		721,000			-
Corporate		758,000			-
TOTAL	$	5,582,000		$	5,196,341

Capital Expenditures
	Dec 31, 2009			Dec 31, 2008
Fire Protection/Alarm & Detection	$	13,900		$	109,000
Telecommunications		-			-
Flooring		-			-
Electrical		-			-
Corporate		253,100			-
TOTAL	$	267,000		$	109,000

F-21

NOTE R- MAJOR CUSTOMERS AND SUPPLIERS

The company had three customers who accounted for $8,141,868 or 45% of the billings for 2009, two customers who accounted for $4,657,431 or 28% of revenue in 2008.

Purchases from the Company’s two major vendors, (more than 10% of purchases) were approximately $1,154,184 and $2,868,088 or 28% and 60% of materials purchases for the years ended December 31, 2009 and 2008, respectively.

NOTE S – EMPLOYEE BENEFITS PLAN

The Company sponsors a defined contribution 401(k) plan covering substantially all full-time employees, which provides for the Company matching the participant's elective deferral up to 3% of their annual gross income. The Company's expense for the plan was $73,063 and $60,868, for the years ended December 31, 2009 and 2008, respectively.

NOTE T - SUBSEQUENT EVENTS

NONE

F-22

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

ITEM 9A. CONTROLS AND PROCEDURES

As supervised by our board of directors and our principal executive and principal financial officers, management has established a system of disclosure controls and procedures and has evaluated the effectiveness of that system. The system and its evaluation are reported on in the below Management's Annual Report on Internal Control over Financial Reporting. Our principal executive and financial officer has concluded that our disclosure controls and procedures (as defined in the 1934 Securities Exchange Act Rule 13a-15(e)) as of December 31, 2009, are effective, based on the evaluation of these controls and procedures required by paragraph (b) of Rule 13a-15.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our disclosure controls and procedures were designed to provide reasonable assurance that the controls and procedures would meet their objectives. As required by SEC Rule 13a-15(b), our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.

Management’s Annual Report on Internal Control over Financial Reporting

Our Chief Executive Officer and Chief Financial Officer are responsible for establishing and maintaining adequate internal control over our financial reporting. In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in Internal Control — Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Management has used the framework set forth in the report entitled Internal Control-Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission, known as COSO, to evaluate the effectiveness of our internal control over financial reporting. Based on this assessment, our Chief Executive Officer and Chief Financial Officer have concluded that our internal control over financial reporting was effective as of December 31, 2009.This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this Annual Report.

There has been no change in our internal controls over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Changes in Internal Controls

There have been no changes in our internal controls over financial reporting or in other factors that could materially affect, or are reasonably likely to affect, our internal controls over financial reporting during the year ended December 31, 2009. There have not been any significant changes in the Company's critical accounting policies identified since the Company filed its Form 10-K as of December 31, 2009

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.

Set forth below is information regarding the Company’s current directors and executive officers. There are no family relationships between any of our directors or executive officers. The directors are elected annually by stockholders. The executive officers serve at the pleasure of the Board of Directors.

Management

Name	Age	Positions and Offices Held
Donald Gordon	50	CEO, Director
Michael Walsh	47	CFO
Tim Crane	53	Director
Jan Engelbrecht	50	Director

Donald Gordon - CEO, co-founder of Pro-Tech Fire Protection Systems Corp.

Mr. Gordon, President and co-founder, brings 32 years of experience in all aspects of fire protection and construction company experience. In 1995, Mr. Gordon, along with Mark Whittaker, formed Pro-Tech Fire Protection and continues to run financial, as well as, day to day operations. Mr. Gordon's experience includes general management, project management, sales, and field work. Mr. Gordon remains active in the development of new business opportunities and fostering long-term business relationships with key clients.

Michael Walsh – Chief Financial Officer

Michael Walsh, CFO, brings over 25 years of experience in Accounting and Finance in both private and public sectors, with established and startup companies. Mr. Walsh has been a member of the Pro-Tech Fire Protection team since 2006. From September 2005- December 2006, Mr. Walsh was with Falcon Technology Holdings, Inc. acting as its Chief Financial Officer. From January 2004 – September 2005, Mr. Walsh was the CFO of IQ Biometrix, Inc. a forensic software startup. The Company merged with Wherify Wireless, Inc. and on close of the merger Mr. Walsh became Corporate Controller. Mr. Walsh holds a Master's degree as well as a bachelor's degree in Business Administration.

Jan Engelbrecht – Director

Jan F. Engelbrecht is a newly appointed Board member as of January 2009. Mr. Engelbrecht has served in the finance and technology industries for 25 years. As a CPA, Mr. Engelbrecht lead audit and consulting engagements for Arthur Anderson and Price Waterhouse in various industries including Banking, Oil & Gas, Real Estate, and High Technology. For the past ten years, Mr. Engelbrecht has served as a Software Client Executive for a world-wide technology company.

Tim Crane – Director

Tim Crane has been in the insurance industry for 29 years. He joined InterWest Insurance Services in 1990 as a sales producer. In 1996 he was promoted to Vice President and became a partner in the firm. In 2005 he was elected to the board of directors, a position he continues to serve on. Tim holds a Bachelor of Science in Business Administration from Northeastern University. He has been involved in volunteer work for the United Cerebral Palsy, IBA West, American Cancer Society and several church and school groups.

Audit Committee Financial Expert

The Company's By-Laws authorize the Board of Directors to appoint committees having the authority to perform such duties as the Board may determine.

The Board of Directors has appointed the Audit Committee to serve the purposes set forth in this Charter, and has delegated the duties and responsibilities set forth in this Charter to the Audit Committee. The Audit Committee will report to the Board of Directors as provided in its Charter.

The Board of Directors has appointed the Compensation Committee to serve the purposes set forth in this Charter, and has delegated the duties and responsibilities set forth in this Charter to the Compensation Committee. The Compensation Committee will report to the Board of Directors as provided in its Charter.

Indemnification of Officers and Directors

As permitted by Nevada law, our Articles of Incorporation provide that we will indemnify its directors and officers against expenses and liabilities they incur to defend, settle, or satisfy any civil or criminal action brought against them on account of their being or having been Company directors or officers unless, in any such action, they are adjudged to have acted with gross negligence or willful misconduct.

Pursuant to the foregoing provisions, we have been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in that Act and is, therefore, unenforceable.

Exclusion of Liability

The Nevada Business Corporation Act excludes personal liability for directors for monetary damages based upon any violation of their fiduciary duties as directors, except as to liability for any breach of the duty of loyalty, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, acts in violation of the Nevada Business Corporation Act, or any transaction from which a director receives an improper personal benefit. This exclusion of liability does not limit any right that a director may have to be indemnified and does not affect any director's liability under federal or applicable state securities laws.

Code of Conduct and Ethics

We are committed to maintaining the highest standards of business conduct and ethics. We have adopted a code of conduct and ethics applicable to our directors, officers and employees. The code of conduct and ethics reflects our values and the business practices and principles of behavior that support this commitment. The code of conduct and ethics satisfies SEC rules for a “code of ethics” required by Section 406 of the Sarbanes-Oxley Act of 2002, as well as the American Stock Exchange rules for a “code of conduct and ethics.” A form of the code of conduct and ethics was filed as Exhibit 14.1 to the Annual Report on Form 10-K for December 31, 2009.

Compliance with section 16(a) of the Securities Exchange Act of 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's directors and executive officers and persons who own more than 10% of a registered class of the Company's equity securities to file various reports with the Securities and Exchange Commission concerning their holdings of, and transactions in, securities of the Company. Copies of these filings must be furnished to the Company.

Mr. Donald Gordon, our President, Chief Executive Officer and director, Mr. Michael P Walsh, our Chief Financial Officer and Tim Crane and Jan Engelbrecht, directors, were required to file Form 3’s.

CONFLICTS OF INTEREST

There are no conflicts of interest with any officers, directors or executive staff.

ITEM 11. EXECUTIVE COMPENSATION.

Summary Compensation Table

The following table sets forth for the year ended December 31, 2009 and 2008 compensation awarded to, paid to, or earned by our other most highly compensated executive officers whose total compensation during each fiscal year exceeded $100,000, if any.

2009 SUMMARY COMPENSATION TABLE

Name and Principal Position	Year	Salary ($)		Bonus ($)		Stock Awards ($)			Option Awards ($)		Non-Equity Incentive Plan Compensation ($)		Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)		All Other Comp. ($)		Total ($)
Don Gordon President	2009		248,717		-		-			-		-		-		19,441		268,158
Pro-Tech Industries	2008		250,000		-		-			-		-		-		-		250,000

Michael Walsh CFO	2009		125,626		-		47,520	*		-		-		-		17,839		190,985
Pro-Tech Industries	2008		112,500		-		-			-		-		-		-		112,500

David Baker	2009		166,750		-		-			-		-		-		6,584		173,334
President Conesco, Inc	2008		-		-		-			-		-		-		-		-

Sean McGuire	2009		118,050		-		2,880	*		-		-		-		18,048		138,978
President Pro-Tech Fire	2008		-		-		-			-		-		-		-		-

*Mr McGuire and Mr Walsh’s shares vest on a monthly basis over 3 years and were part of the stock awarded key employees as summarized in the following two tables.

2009 and 2008 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLE

	Option Awards										Stock Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)		Option Exercise Price		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Key employee grant		-		-		-		-		-		630,547		283,746		-		-

2009 and 2008 OPTION EXERCISES AND STOCK VESTED TABLE

Option Awards

Stock Awards

Name

Year

Number of Shares

Acquired on

Exercise (#)

Value Realized on

Exercise ($)

Number of Shares

Acquired on Vesting

(#)

Value Realized on

Vesting ($)

Key employee grant

2009

297,213

150,000

2009 and 2008 PENSION BENEFITS TABLE

Name

Year

Plan Name

Number of Years of

Credited Service

Present Value of

Accumulated Benefit

($)

Payments During

Last Fiscal Year ($)

NONE

2009 and 2008 NONQUALIFIED DEFERRED COMPENSATION TABLE

Name

Year

Executive

Contributions in

Last Fiscal Year

($)

Registrant

Contributions in

Last Fiscal Year

($)

Aggregate

Earnings in Last

Fiscal Year ($)

Aggregate

Withdrawls /

Distributions

Aggregate

Balance at Last

Fiscal Year-End

($)

NONE

2009 DIRECTOR COMPENSATION TABLE

Name	Fees Earned or Paid in Cash ($)		Stock Awards ($)		Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)	Total ($)

Don Gordon		600		32,500						33,100
Jan Engelbrecht		600		32,500						33,100
Tim Crane		600		32,500						33,100

2009 ALL OTHER COMPENSATION TABLE

Name	Year	Perquisites and Other Personal Benefits ($)		Tax Reimbursement ($)		Insurance Premiums ($)		Company Contributions to Retirement and 401(k) Plans ($)		Severance Payments / Accruals ($)		Change in Control Payments / Accruals ($)		Total ($)

Donald Gordon	2009		3,358		-		16,083				-		-		19,441
Michael Walsh	2009		1,756				16,083								17,839
Dave Baker	2009		1,842		-		4,742		-		-		-		6,584
Sean McGuire	2009		2,230				15,818								18,048

2009 PERQUISITES TABLE

Name	Year	Personal Use of Company Car/Parking		Financial Planning/ Legal Fees		Club Dues		Executive Relocation		Total Perquisites and Other Personal Benefits

Donald Gordon	2009		3,358		-		-		-		3,358
Michael Walsh	2009		1,756								1,756
Dave Baker	2009		1,842		-		-		-		1,842
Sean McGuire	2009		2,230								2,230

2009 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE

Before Change in

Control

After Change in

Control

Name

Benefit

Termination

w/o Cause or for

Good Reason

Termination

w/o Cause or

for Good Reason

Voluntary

Termination

Death

Disability

Change in

Control

NONE

*	List each applicable type of benefit in a separate row, e.g., severance pay, bonus payment, stock option vesting acceleration, health care benefits continuation, relocation benefits, outplacement services, financial planning services or tax gross-ups.

Compensation of Directors

We currently have three directors. Directors are paid $100 per meeting attended and were awarded 10,000 shares of our common stock each for serving as a member of the Board of Directors for the fiscal year ended December 31, 2009. The Board of Directors will review its compensation package on annual basis. The directors voted to temporarily stop payments until a determined date.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS, CONFLICTS OF INTEREST

No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by us for the benefit of its employees.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table lists stock ownership of our Common Stock as of December 31, 2009. The information includes beneficial ownership by (i) holders of more than 5% of our Common Stock, (ii) each of three directors and executive officers and (iii) all of our directors and executive officers as a group. Except as noted below, to our knowledge, each person named in the table has sole voting and investment power with respect to all shares of our Common Stock beneficially owned by them.

Name and Address of Beneficial Owner	Amount of Beneficial Ownership		Percentage of Class

Donald H. Gordon		5,050,000		27.2	%
8550 Younger Creek Dr Sacramento, CA 95828
Michael P Walsh		320,000		1.7	%
8550 Younger Creek Dr Sacramento, CA 95828
Tim Crane		32,000		*
8550 Younger Creek Dr Sacramento, CA 95828
Jan Engelbrecht		10,000		*
8550 Younger Creek Dr Sacramento, CA 95828
All Executive Officers and Directors as a Group		5,412,000		29.1	%
(4 Persons)
Mark Whittaker		5,050,000		27.2	%
3225 Production Ave, Ste B Oceanside, CA 92058
Dave Baker		2,900,000		15.6	%
8550 Younger Creek Dr, Sacramento, CA 95828

DESCRIPTION OF SECURITIES

Our authorized capital stock consists of 70,000,000 shares of Common Stock, par value $.001 per share. The following statements relating to the capital stock set forth the material terms of our securities; however, reference is made to the more detailed provisions of, and such statements are qualified in their entirety by reference to, the Certificate of Incorporation, amendment to the Certificate of Incorporation and the By-laws, copies of which are filed as exhibits to this registration statement.

COMMON STOCK

Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the stockholders. Holders of common stock do not have cumulative voting rights. Holders of common stock are entitled to share ratably in dividends, if any, as may be declared from time to time by the Board of Directors in its discretion from funds legally available therefore. In the event of a liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. All of the outstanding shares of common stock are fully paid and non-assessable. Holders of common stock have no preemptive rights to purchase our common stock. There are no conversion or redemption rights or sinking fund provisions with respect to the common stock.

The Board of Directors does not at present intend to seek stockholder approval prior to any issuance of currently authorized stock, unless otherwise required by law or stock exchange rules.

PREFERRED STOCK

The Company is authorized to issue 5,000,000 shares of Preferred Stock, $0.001 par value, of which no shares were issued and outstanding as of December 31, 2009. The Board of Directors may issue such shares of Preferred Stock in one or more series, with such voting powers, designations, preferences and rights or qualifications, limitations or restrictions thereof as shall be stated in the resolution or resolutions.

DIVIDENDS

Dividends, if any, will be contingent upon our revenues and earnings, if any, capital requirements and financial conditions. The payment of dividends, if any, will be within the discretion of our Board of Directors. We presently intend to retain all earnings, if any, for use in its business operations and accordingly, the Board of Directors does not anticipate declaring any dividends prior to a business combination.

INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Neither our Articles of Incorporation nor Bylaws prevent us from indemnifying our officers, directors and agents to the extent permitted under the Nevada Revised Statute ("NRS"). NRS Section 78.502, provides that a corporation shall indemnify any director, officer, employee or agent of a corporation against expenses, including attorneys' fees, actually and reasonably incurred by him in connection with any the defense to the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to Section 78.502(1) or 78.502(2), or in defense of any claim, issue or matter therein.

NRS 78.502(1) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he: (a) is not liable pursuant to NRS 78.138; or (b) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.

NRS Section 78.502(2) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including amounts paid in settlement and attorneys' fees actually and reasonably incurred by him in connection with the defense or settlement of the action or suit if he: (a) is not liable pursuant to NRS 78.138; or (b) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation. Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals there from, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.

NRS Section 78.747 provides that except as otherwise provided by specific statute, no director or officer of a corporation is individually liable for a debt or liability of the corporation, unless the director or officer acts as the alter ego of the corporation. The court as a matter of law must determine the question of whether a director or officer acts as the alter ego of a corporation.

No pending material litigation or proceeding involving our directors, executive officers, employees or other agents as to which indemnification is being sought exists, and we are not aware of any pending or threatened material litigation that may result in claims for indemnification by any of our directors or executive officers.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed hereby in the Securities Act and we will be governed by the final adjudication of such issue.

Amendment of our Bylaws

Our bylaws may be adopted, amended or repealed by the affirmative vote of a majority of our outstanding shares. Subject to applicable law, our bylaws also may be adopted, amended or repealed by our Board of Directors.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

Related Party Transactions

Two stockholders of the Company are co-owners of an entity that provides charter air services, and on occasion, the Company utilizes this entity for air travel services in connection with the Company’s contracting. During the years ended December 31, 2009 and 2008, the Company incurred and charged to operations $167,949 and $234,038, respectively, in connection with air travel services provided by the entities to the Company. There were no payables owed to the entities at December 31, 2009 and 2008, respectively.

Director Independence

One of our directors, Donald Gordon, is an employee and would not be classified as “independent” under the rules of the Securities and Exchange Commission. The other two would be considered “independent”.

Item 14. Principal Accountant Fees and Services

On February 17, 2009, RBSM, LLP ("RBSM") was appointed as the independent auditor for Pro-Tech Industries, Inc. (the "Company") commencing with the year ending December 31, 2008, and Arshad M Farooq, JD, CPA ("FAROOQ") was dismissed as the independent auditors for the Company as of February 10, 2009.

	2009		2008		2007
	RBSM, LLP		RBSM, LLP		Arshad M Farooq, JD, CPA
Audit Fees (1)	$	219,409	$	78,659	$	2,000
Audit-Related Fees (2)		-		-		-
Tax Fees (3)		-		-		-
All Other Fees (4)		-		-		-

Total	$	219,409	$	78,659	$	2,000

(1)	Audit fees represent fees for professional services provided in connection with the audit of our financial statements and review of our quarterly financial statements.

The audit committee has reviewed and discussed with the Company's management and independent registered public accounting firm the audited consolidated financial statements of the Company contained in the Company's Annual Report on Form 10-K for the Company's 2009 fiscal year. The audit committee has also discussed with the auditors the matters required to be discussed, which includes, among other items, matters related to the conduct of the audit of the Company's consolidated financial statements.

Based on the review and discussions referred to above, the Board approved the inclusion of the audited consolidated financial statements be included in the Company's Annual Report on Form 10-K for its 2009 fiscal year for filing with the SEC.

Pre-Approval Policies

The audit committee's policy is now to pre-approve all audit services and all permitted non-audit services (including the fees and terms thereof) to be provided by the Company's independent registered public accounting firm; provided, however, pre-approval requirements for non-audit services are not required if all such services (1) do not aggregate to more than five percent of total revenues paid by the Company to its accountant in the fiscal year when services are provided; (2) were not recognized as non-audit services at the time of the engagement; and (3) are promptly brought to the attention of the Board and approved prior to the completion of the audit.

The Board pre-approved all fees described above.

PART IV

ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS

Exhibits

3.1		Articles of Incorporation (1)
3.2		Bylaws of the Corporation (1)
14.1		Code of Ethics (2)
21		Subsidiaries (3)
31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. (3)
31.2		Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. (3)
32.1		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. (3)
32.2		Certification of Chief Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. (3)

(1)

Incorporated by reference to the same exhibit filed with the Company’s Registration Statement on Form SB2 (Commission File No. 333-144076).

(2)

Incorporated by reference to the same exhibit filed with Amendment No. 3 to the Company’s Registration Statement on Form SB2 (Commission File No. 333-137170).

(3)

Filed herewith.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Pro-Tech Industries, Inc.

Dated: April 15, 2010

	By:	/s/ Donald Gordon
	Donald Gordon, President, Chief
	Executive Officer and Director

	By:	/s/ Michael P Walsh
	Michael P Walsh
	Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant in the capacities indicated, on April 15, 2010.

By:	/s/ Donald Gordon
Donald Gordon, President, Chief Executive Officer and Director

By:	/s/ Jan Engelbrecht
Jan Engelbrecht, Director

By:	/s/ Tim Crane
Tim Crane, Director

Pro-Tech Industries, Inc. - FORM 10-K - April 15, 2010

Attached files

Pro-Tech Industries, Inc. Reports