Caribbean American Health Resorts, Inc. /vital Health Inactive
Filed: 7 Aug 02, 12:00am
| [ X ] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2002
| [ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from
Commission File No. 000-15243
VITAL HEALTH TECHNOLOGIES, INC.
(Exact name of small business issuer as specified in its charter)
| Minnesota | 41-1618186 |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |
855 Village Center Drive, North Oaks, MN 55127
(Address of Principal Executive Offices)
(651) 238-8636
(Issuer's telephone number)
Former name, address and fiscal year, if changed since last report)
Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
State the number of shares outstanding of each of the issuer's classes of common equity, as of June 30, 2002: 3,740,710 shares of common stock.
Transitional Small Business Format: Yes [X] No [ ]
FORM 10-QSB
VITAL HEALTH TECHNOLOGIES, INC.
INDEX
| Page | |||
| PART I. | FINANCIAL INFORMATION | 3 | |
| Item 1 | Financial Statements | 3 | |
| Item 2 | Management's Discussion and Analysis of Financial Condition and Plan of Operation | 7 | |
| PART II. | OTHER INFORMATION | 9 | |
| SIGNATURES | 9 |
Item 1. Financial Information
VITAL HEALTH TECHNOLOGIES, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS
(Unaudited)
June 30, December 31,
2002 2001
---------- ----------
ASSETS
------
Current assets:
Cash $ 24,112 $ 1,379
Inventory, net of valuation allowance - - - -
---------- ----------
Total current assets 24,112 1,379
---------- ----------
Net furniture and equipment - - - -
---------- ----------
Total assets $ 24,112 $ 1,379
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued expenses $ 12,204 $ 10,080
Notes payable - convertible 97,500 102,500
---------- ----------
Total current liabilities 109,704 112,580
---------- ----------
Stockholders' equity (deficit):
Undesignated stock: 5,000,000 shares
authorized; none issued and outstanding - - - -
Common stock: $.01 par value; 50,000,000
shares authorized; shares issued and
outstanding 3,740,710 in 2002 and
2,594,460 in 2001 37,407 2,845
Additional paid-in capital 12,315,316 11,966,778
Subscription receivable (300,000) - -
Accumulated deficit (11,793,637) (11,793,637)
Deficit accumulated during the
development stage (344,678) (287,187)
---------- ----------
Total stockholders' equity (deficit) (85,592) (111,201)
---------- ----------
Total liabilities and
Stockholders' equity (deficit) $ 24,112 $ 1,379
========== ==========
See Notes to Financial Statements.
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VITAL HEALTH TECHNOLOGIES, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30, Reentrance Into
-------- -------- Development Stage
2002 2001 2002 2001 To June 30, 2002
---- ---- ---- ---- ----------------
Revenues $ -- $ 2,346 $ -- $ 2,907 $ 96,361
Cost of sales -- -- -- (38) (38)
General and administrative
expenses (10,380) (25,551) (52,197) (92,841) (771,043)
Interest expense (2,567) (2,250) (5,294) (2,783) (97,268)
Other income (expense) -- -- -- -- (7,404)
Debt forgiveness -- -- -- -- 435,243
Income tax expense -- -- -- -- (529)
----------- ----------- ----------- ----------- -----------
Net income (loss) (12,947) (25,455) (57,491) (93,110) (344,678)
Other comprehensive
income (loss) -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Comprehensive income (loss) $ (12,947) $ (25,455) $ (57,491) $ (93,110) $ (344,678)
=========== =========== =========== =========== ===========
Basic earnings (loss) per share $ (.01) $ (.09) $ (.01) $ (.33) $ (1.73)
=========== =========== =========== =========== ===========
Weighted average number of
shares outstanding 2,801,727 283,990 1,232,193 283,990 199,240
=========== =========== =========== =========== ===========
See Notes to Financial Statements.
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VITAL HEALTH TECHNOLOGIES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
Increase (Decrease) In Cash
(Unaudited)
Reentrance
Six Months Ended Development
March 31 Stage to
2002 2001 June 30, 2002
---- ---- -------------
Cash flows from operating activities:
Net income (loss) $ (57,491) $ (93,110) $(344,678)
Adjustments to reconcile
net income (loss) to
cash flows from operating
activities:
Debt forgiveness -- -- (435,243)
Indebtedness incurred
for services and storage -- -- 400,000
Implied compensation under
SABS-T 10,000 -- 130,000
Stock issued for services 23,100 -- 23,100
Warrants issued for
consulting services -- 550 2,012
Depreciation 726 974 2,672
Valuation allowance (726) -- 6,878
Inventory -- 38 38
Prepaid expenses -- 7,282 --
Accounts payable and
other current liabilities 2,124 (6,273) (8,470)
--------- --------- ---------
Cash flows from operating
activities (22,267) (90,539) (223,691)
--------- --------- ---------
Cash flows from financing activities:
Stock proceeds 50,000 -- 84,888
Issuance of convertible
notes payable 10,000 90,000 167,038
Principal payments (15,000) -- (15,000)
--------- --------- ---------
Cash flows from investing
activities 45,000 90,000 236,926
--------- --------- ---------
Increase (decrease) in cash 22,733 (539) 13,235
Cash:
Beginning of year 1,379 9,143 10,877
--------- --------- ---------
End of year $ 24,112 $ 8,604 $ 24,112
========= ========= =========
Supplemental cash flow information:
Interest paid $ -- $ -- $ --
========= ========= =========
Income taxes paid $ -- $ -- $ 1,081
========= ========= =========
See Notes to Financial Statements.
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The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month period ended June 30, 2002 are not necessarily indicative of the results that may be expected for the year ended December 31, 2002. For further information, refer to the financial statements and footnotes thereto included in the Company's Form 10-KSB for the year ended December 31, 2001.
The Company was incorporated on April 1, 1960, under the laws of the State of Minnesota. On September 26, 2000, the Company changed its name to Vital Health Technologies, Inc. Formerly the Company was known as Vital Heart Systems, Inc.
In November 1993, the Company ceased the majority of its operations. At January 1, 1994, the Company was deemed to have reentered the development stage. From 1994 to 1997 the Company had only limited operations as it tried to complete the design and marketing of a non-invasive, stress-free coronary artery disease (CAD) detection device called a Variance Cardiograph. In 1997 the Company ceased all operations.
In 1998 and 1999 the Company worked with a Minnesota venture capital firm, Aurora Capital Management, LLC (Aurora) and a Minnesota entity with compatible business operations, Vital Health Technologies, LLC (VHT-LLC) in an effort to revitalize the Company. These dealings ultimately led to the acquisition of VHT-LLC’s assets on December 1, 2000.
On January 1, 1994, the Company was deemed to have reentered the development stage. Since that date the Company has devoted the majority of its efforts to: maintenance of the corporate status; settlement of liabilities; technology development and the search for a viable method of operations and/or merger candidate.
In 1998, 1999, 2000 and 2001 the Company was fully dependent on VHT-LLC and Aurora for the maintenance of its corporate status and to provide all managerial assistance and working capital support for the Company.
In 2001 the Company successfully developed a new prototype for its Variance Cardiograph heart disease testing device that shortens the test time from the original 45-minute version to 10-minutes, while at the same time reducing the cost of manufacturing significantly. The Company completed field-testing and has systems installed at two locations in the St. Paul/Minneapolis area for evaluation purposes.
During 2001, there were several unsuccessful efforts to secure $2,000,000 in financing in order to complete plans to fully develop and market the Variance Cardiograph. Due to lack of capital the Company decided to focus its efforts towards reducing expenses and position itself for merger/acquisition opportunities. On January 30, 2002 the company entered into an agreement with a
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Texas based finance and consulting firm, Focus Tech Investments, Inc. (FTI) whereas FTI will provide periodic financing and will seek out potential merger/acquisition candidates for the Company. Vital Health Technologies has provided FTI 2,000,000 shares of Vital Health Technologies common stock as a retainer for the services. In the event no merger or acquisition takes place by August 30, 2002, FTI has agreed to cancel the 2,000,000 shares of common stock.
On April 23, 2002 the Company entered into a stock purchase agreement with Templar Comptier, Ltd whereas the company has agreed to sell 1,146,250 shares of its common stock for $350,000. Templar Comptier has paid $50,000 in cash for 146,250 shares that have been delivered and issued a 180-day note for $300,000 with the remaining 1,000,000 shares being held as collateral against the note.
The Company plans to utilize the proceeds for ongoing administrative costs, debt payment and to finance merger/acquisition expenses.
The Company filed an SB-2 registration with the SEC for the shares issued to Templar Comptier, Ltd and 386,224 shares that were previously issued to shareholders of Vital Health Technologies.
Failure of the company to secure a merger/acquisition agreement and/or adequate financing could result in it being unable to continue as a going concern. No estimate can be made of the range of loss that is reasonably possible should the Company be unsuccessful.
The Company generated no revenue for the three months ended June 30, 2002, as compared to $2,346 revenue for the three months ended June 30, 2001. Cost of sales for the three months ended June 30, 2002 and 2001 were $0 and $0, respectively.
General and administrative expenses for the three months ended June 30, 2002 were $10,380, as compared to $25,551 in the same period of 2001.
The Company had interest expense in the amount of $2,567 for the three months ended June 30, 2002, as compared to $2,250 interest expense for the three months ended June 30, 2001.
As a result of the foregoing, the Company realized a net loss of $12,947 for the three months ended June 30, 2002, as compared to net $25,455 for the same period in 2001.
At June 30, 2002, the Company had a working capital deficit of $85,592, as compared to a working capital deficit of $111,201 at December 31, 2001. The change is primarily due to the Company selling shares of common stock and paying off a promissory note.
The Company received $50,000 in cash from the sale of 146,250 shares of common stock and was issued a 180 day note for the amount of $300,000 in exchange for the sale of 1,000,000 shares of common stock being held as collateral. The company anticipates utilizing the proceeds to finance administrative expenses, debt payments and merger/acquisition expenses.
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On May 8, 2002 the Company paid off a 10% - $15,000 note due Aurora Capital Management that was issued January 30, 2001. The total amount including interest was $16,915. The Company's balance sheet shows $97,500 in notes payable-convertible that is represented by five individuals. As the proceeds become available from the stock sale to Templar Comptier, Ltd., the Company's plan is to pay off the debt owed.
On April 23, 2002 the board of directors approved a stock purchase agreement with Templar Comptier, Ltd, a London based investment-banking firm with offices in the United States. Templar Comptier purchased 1,146,250 shares of Vital Health Technologies, Inc. common stock for a total of $350,000. The company issued and delivered 146,250 shares of stock after receiving $50,000. Simultaneous with the agreement, a 180-day note for $300,000 has been issued to Vital Health Technologies for the remaining 1,000,000 shares. The Company is holding the shares as collateral until the note is paid in full.
On June 6, 2002 the Company filed an SB-2 registration with the Securities and Exchange Commission for all the shares sold to Templar Comptier, Ltd. and 386,224 shares held by the seven shareholders. The effective date for the registration was June 24, 2002.
Our plan for the next 12 months is to handle the administrative and reporting requirements of a public company and to seek merger/acquisition opportunities while maintaining evaluation sites for the Variance Cardiograph.
When used in this report, the words "may," "will," "expect," "anticipate," "continue," "estimate," "project," "intend," and similar expressions are intended to identify 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 regarding events, conditions, and financial trends that may affect the Company's future plans of operations, business strategy, operating results, and financial position. Persons reviewing this report are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and that actual results may differ materially from those included within the forward-looking statements as a result of various factors. Such factors are discussed above and also include general economic factors and conditions that may directly or indirectly impact the Company's financial condition or results of operations.
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None
None
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Vital Health Technologies, Inc. | |
| Date: August 6, 2002 | By: /s/ Lloyd Woelfle Lloyd Woelfle Director |
| By: /s/ Stephen Muscanto Stephen Muscanto Director |
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