UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 10-QSB
_________________________
ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2004
OR
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 0-32267
SPECIALIZED SERVICES, INC.
(Exact Name Of Registrant As Specified In Its Charter)
Fifth Avenue Acquisition II Corp. |
(Former name of small business issuer in its charter) |
| Michigan | 38-2781857 |
| (State of Incorporation) | (I.R.S. Employer Identification No.) |
| 23077 Greenfield Road, Suite 470, Southfield, MI | 48075 |
| (Address of Principal Executive Offices) | (ZIP Code) |
Registrant's Telephone Number, Including Area Code: (248) 557-1030
Securities Registered Pursuant to Section 12(g) of The Act: Common Stock, $0.0001
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ¨ No x.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
| Large accelerated filer ¨ | Accelerated filer ¨ | Non-accelerated filer x |
At June 30, 2004, the Registrant had 1,000,000 shares of common stock issued.
| Item | Description | Page | |||
|---|---|---|---|---|---|
PART I - FINANCIAL INFORMATION | |||||
ITEM 1. | 3 | ||||
ITEM 2. | 3 | ||||
ITEM 3. | 4 | ||||
PART II - OTHER INFORMATION | |||||
ITEM 1. | 5 | ||||
ITEM 2. | 5 | ||||
ITEM 3. | 5 | ||||
ITEM 4. | 5 | ||||
ITEM 5. | 5 | ||||
| ITEM 6. | EXHIBITS AND REPORTS ON FORM 8-K. | 5 | |||
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS Back to Table of Contents
The Registrant's financial statements for the three-and six month periods ended June 30, 2004 and 2003 are attached to this quarterly report.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION Back to Table of Contents
Forward-Looking Statements; Market Data
As used in this Quarterly Report, the terms "we", "us", "our" "Registrant", "SPSV" and the "Company" means Specialized Services, Inc., a Michigan corporation, and its subsidiaries. To the extent that we make any forward-looking statements in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Report, we emphasize that forward-looking statements involve risks and uncertainties and our actual results may differ materially from those expressed or implied by our forward-looking statements. Our forward-looking statements in this Quarterly Report reflect our current views about future events and are based on assumptions and are subject to risks and uncertainties. Generally, forward-looking statements include phrases with words such as "expect", "anticipate", "intend", "plan", "believe", "seek", "estimate" and similar expressions to identify forward-looking statements.
Overview
Our activities were related to seeking new business opportunities. We used our limited personnel and financial resources principally in connection with the search for new business opportunities. It may be expected that starting any new business opportunity will involve the issuance of our shares of Common Stock. To the extent that Common Stock is used to acquire any new business, any available cash, of which there can be no assurance, will be used to finance such new business operations. There was no stock issued from December 31, 2002 through October 2005. At the end of the period covered by this report, we have no cash or other current assets.
During the period of this report, we raised no funds through the sale of securities and we generated no revenues.
We may determine to seek to raise funds from the sale of equity or debt securities, from bank or other borrowings as part of any new business opportunity. We may issue a substantial number of additional shares and to the extent that such additional shares are issued, our shareholders will experience a dilution in their ownership interest. Additionally, if a substantial number of shares of Common Stock are issued in connection with a new business combination, a change in control of the Company may be expected to occur.
There currently are no limitations on our ability to borrow funds pursue new business opportunity. However, our limited resources may make it difficult to borrow funds. The amount and nature of any borrowing by us will depend on numerous factors, including the Company's capital requirements, potential lenders' evaluation of the Company's ability to meet debt service on borrowing and the then prevailing conditions in the financial markets, as well as general economic conditions. The inability of the Company to borrow funds required to pursue new business opportunities, or to provide funds for an additional infusion of capital, may have a material adverse effect on the Company's financial condition and future prospects. To the extent that debt financing ultimately proves to be available, any borrowing will subject the Company to various risks traditionally associated with indebtedness, including the risks of interest rate fluctuations and insufficiency of cash flow to pay principal and interest.
Recent Developments
On October 5, 2005 Fifth Avenue Acquisition II Corp. entered into an agreement and plan of merger with Specialized Services, Inc. (SPSV) to exchange 100% of its shares for 22,000,000 shares of common stock of Fifth Avenue Acquisition II Corp. As a result, SPSV became the successor reporting company.
ITEM 3. CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures. As of June 30, 2004, the Company's chief executive officer and chief financial officer conducted an evaluation regarding the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the evaluation of these controls and procedures, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective as of the date of filing this annual report applicable for the period covered by this report.
Changes in internal controls. During the period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS Back to Table of Contents
None.
ITEM 2. CHANGES IN SECURITIES Back to Table of Contents
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES Back to Table of Contents
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Back to Table of Contents
None.
ITEM 5. OTHER INFORMATION Back to Table of Contents
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K Back to Table of Contents
(a) The following documents are filed as exhibits to this report on Form 10-QSB or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.
| Exhibit No. | Description |
| 31.1 | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002 |
| 31.2 | Certification of Chief Financial Officer Pursuant to Section 906 of Sarbanes-Oxley Act of 2002 |
| 32.1 | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002 |
| 32.2 | Certification of Chief Financial Officer Pursuant to Section 906 of Sarbanes-Oxley Act of 2002 |
(b) Reports on Form 8-K During the Period Covered by this Report:
The Registrant has not filed a Form 8-K during the period ended June 30, 2004.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.
| /s/ David E. Joseph, CEO, President | /s/ Michael B. Jackson, CFO |
| (Principal Executive Officer) | (Principal Financial Officer) |
| Dated: October 29, 2007 | Dated: October 29, 2007 |
Financial Statements Back to Table of Contents
| FIFTH AVENUE ACQUISITION II CORP. | ||
| (A DEVELOPMENT STAGE ENTERPRISE) | ||
| BALANCE SHEET | ||
| AS OF JUNE 30, 2004 (Unaudited) | ||
JUNE 30, 2004 | ||
ASSETS | ||
| Current Assets | ||
| Cash | $ | 0 |
| TOTAL ASSETS | 0 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| LIABILITIES | ||
| Accrued Expenses | $ | 0 |
| Due to Related Party | 0 | |
| TOTAL LIABILITIES | 0 | |
| STOCKHOLDERS' EQUITY | ||
| Common Stock, $.001 par value, 20,000,000 shares authorized, 1,000,000 issued and outstanding | 1,000 | |
| Deficit accumulated during development stage | (1,000) | |
| Total Stockholders' Equity | 0 | |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 0 |
| See accompanying notes to financial statements. | ||
FIFTH AVENUE ACQUISITION II CORP. | ||||||||||
(A DEVELOPMENT STAGE ENTERPRISE) | ||||||||||
STATEMENTS OF OPERATIONS (Unaudited) | ||||||||||
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2004 AND 2003 | ||||||||||
Three-Months | Three-Months | Six-Months | Six-Months | August 14, 2000 | ||||||
Ended | Ended | Ended | Ended | (Inception) to | ||||||
June 30, 2004 | June 30, 2003 | June 30, 2004 | June 30, 2003 | March 31, 2004 | ||||||
| Income from forgiveness of debt | 7,643 | |||||||||
| Expenses: | ||||||||||
| Administrative | - | - | - | - | 8,643 | |||||
| Total expenses | - | - | - | - | 8,643 | |||||
| Net Income (Loss) | $ | - | $ | - | $ | - | $ | - | $ | (1,000) |
| Basic and Diluted Net Income per Share | $ | - | $ | - | $ | - | $ | - | $ | 0.00 |
| Weighted Average Common Shares Outstanding | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | |||||
| See accompanying notes to financial statements. | ||||||||||
FIFTH AVENUE ACQUISITION II CORP. | ||||||
(A DEVELOPMENT STAGE ENTERPRISE) | ||||||
STATEMENTS OF CASH FLOWS | ||||||
FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003 | ||||||
Six-Months | Six-Months | August 14, 2000 | ||||
Ended | Ended | (Inception) to | ||||
June 30, 2004 | June 30, 2003 | June 30, 2004 | ||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
| Net income (loss) | $ | - | $ | - | $ | (1,000) |
| Adjustments to reconcile net income to cash generated by operating activities: | ||||||
| Income from forgiveness of debt | - | - | (7,643) | |||
| Changes in operating assets and liabilities: | ||||||
| Increase (decrease) in accrued liabilities | - | - | 2,786 | |||
| Net cash used in operating activities | - | - | (5,857) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
| Proceeds from the issuance of common stock | - | - | 1,000 | |||
| Advanced from related party | - | - | 4,857 | |||
| Net cash provided by financing activities | - | - | 5,857 | |||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | - | - | - | |||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | - | - | - | |||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | - | $ | - | $ | - |
| Supplemental Disclosures of Cash Flow Information: | ||||||
| Taxes Paid | $ | - | $ | - | $ | - |
| Interest Paid | $ | - | $ | - | $ | - |
| See accompanying notes to financial statements. | ||||||
FIFTH AVENUE ACQUISITION II CORP. |
(A DEVELOPMENT STAGE ENTERPRISE) |
NOTES TO FINANCIAL STATEMENTS |
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Business Operations
Fifth Avenue Acquisition II Corp. (a development stage enterprise) (the "Company") was incorporated in Florida on August 14, 2000 to serve as a vehicle to effect a merger, exchange of capital stock, asset acquisition or other business combination transaction with a domestic entity. As of June 30, 2004, the Company had not yet commenced any formal business operations, and all activity to date relates to the Company's formation and proposed fund raising. The Company's fiscal year end is December 31.
The Company's ability to commence operations is contingent upon its ability to identify a prospective target business and the surviving entity’s ability to secure the capital it will require through the issuance of equity securities, debt securities, bank borrowings or a combination thereof.
Use of Estimates
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Fair Value of Financial Instruments
Financial instruments, including cash, receivables, accounts payable, and notes payable are carried at amounts which reasonably approximate their fair value due to the short-term nature of these amounts or due to variable rates of interest which are consistent with market rates. At present, the Company does not have any receivables, accounts payable or notes payable.
Impairment of Long-Lived Assets
The Company adopted FASB Statement No. 121 (SFAS 121), "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of". SFAS 121 requires that impairment losses are to be recorded when long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset. Long-lived assets to be disposed of, if any, are reported at the lower of carrying amount or fair value less cost to sell. There have been no material adjustments for impairments of long-lived assets.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
Income Taxes
The Company accounts for income taxes under the Financial Accounting Standards Board of Financial Accounting Standard No. 109, "Accounting for Income Taxes" ("Statement 109"). Under Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under Statement 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. There were no current or deferred income tax expense or benefits due to the Company's not having any material operations for the period ending June 30, 2004.
Recent Accounting Pronouncements
In 2000, the Company is subject to the provisions of Statement of Financial Accounting Standards No. 130 ("SFAS 130"), "Reporting Comprehensive Income" and Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosures about Segments of an Enterprise and Related Information." Neither statement had any impact on the Company's financial statements as the Company does not have any "comprehensive income" type earnings (losses) and its financial statements reflect how the "key operating decisions makers" view the business. The Company will continue to review these statements over time, in particular SFAS 131, to determine if any additional disclosures are necessary based on evolving circumstances.
NOTE 2 – STOCKHOLDERS’ EQUITY
Common Stock
The Company is authorized to issue 20,000,000 shares of common stock at $0.001 par value. The Company issued 1,000,000 shares of its common stock to its shareholders pursuant to the exemption provided under Section 4(2) of the Securities Act of 1933, as amended, for an aggregate consideration of $1,000.
Preferred Stock
As of June 30, 2004, the Company is authorized to issue 3,000,000 shares of preferred stock par $0.001 par value, which may be divided into series and with the preferences, limitations and relative rights determined by the board of directors. No preferred stock has been issued as of the date of this report.
NOTE 3 - STOCK OPTION PLAN
On January 24, 2001, the board of directors authorized a 2001 Stock Option Plan. The plan is divided into two separate separate equity programs: the Option Grant Programs under which eligible persons may, at the discretion of the Plan Administrator, be granted options to purchase shares of common stock and the Stock Issuance Program under which eligible persons may, at the discretion of the Plan Administrator, be issued shares of common stock directly, either through the immediate purchase of such shares or as a bonus for services rendered to the Company (or any Parent or Subsidiary).
NOTE 4 – NET LOSS PER SHARE
We compute net loss per share in accordance with SFAS No. 128 "Earnings per Share" ("SFAS No. 128") and SEC Staff Accounting Bulletin No. 98 ("SAB 98"). Under the provisions of SFAS No. 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss for the period by the number of common and common equivalent shares outstanding during the period. There were no common equivalent shares outstanding as of June 30, 2004.
NOTE 5 – AGREEMENT WITH RELATED PARTY
On September 10, 2000, the Company signed an agreement with CR Capital Services, Inc. (CRCS), a related party. (The principals of CRCS are the Company's stockholders.) The Agreement calls for CRCS to provide the following services, without reimbursement from the Company, until the Company enters into a business combination transaction as described in Note 1:
1. Preparation and filing of required documents with the Securities and Exchange Commission, including the Form 10-SB registration statement, and the Annual Report on Form 10-KSB, and Quarterly Reports on Form 10-QSB;
2. Location and review of potential target companies and the preparation and filing of a Form 8-K reporting the transaction;
3. Payment of all professional and accounting fees, and corporate, organizational and other costs incurred by the Companay.
As of December 31, 2002, CRCS had advanced the Company $4,857, which is represented in the account due to related party. In the fourth quarter of 2002, this amount owed by the Company was forgiven and the payable at December 31, 2002 was reduced to $-0-.
NOTE 6 - SUBSEQUENT EVENT
On October 5, 2005 Fifth Avenue Acquisition II Corp. entered into an agreement and plan of merger with Specialized Services, Inc. (SPSV) to exchange 100% of its shares for 22,000,000 shares of common stock of Fifth Avenue Acquisition II Corp. As a result, SPSV became the successor reporting company.
