UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
June 30, 2004[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to Commission File No. 33-55254-28
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
(Exact name of Registrant as specified in its charter)
NEVADA 87-0438641
(State or other jurisdiction of ( I.R.S. Employer
incorporation or organization) Identification Number)
378 North Main, #124; Layton, UT 84041
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (801) 497-9075
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 shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[ X ] Yes [ ] No
24,624,198 SHARES $.001 PAR VALUE CLASS A
(Number of shares of common stock the registrant had outstanding as of August 1, 2004 )
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The condensed financial statements included herein have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission.
In the opinion of the Company, all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the financial position of the Company as of June 30, 2004 and the results of its operations and changes in its financial position from December 31, 2003 through June 30, 2004 have been made. The result of its operations for such interim period is not necessarily indicative of the results to be expected for the entire year.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
BALANCE SHEETS
| (Unaudited) | | |
| June 30, | | December 31, |
| 2004 | | 2003 |
| | | |
| ASSETS | $ - | | $ - |
| | | |
| LIABILITIES & STOCKHOLDER'S EQUITY | | | |
| Current Liabilities | | | |
| Accounts Payable | $ 8,929 | | $ 3,637 |
| Accrued Interest | 2,528 | | 1,166 |
| Notes Payable | 25,140 | | 25,140 |
| Total Current Liabilities | 36,597 | | 29,943 |
| | | |
| Stockholders' Equity | | | |
| Preferred Stock, $.001 par value; | | | |
| 25,000,000 shares authorized; None issued | - | | - |
| Common Stock, $.001 par value: 125,000,000 shares | | | |
| authorized, issued and outstanding 24,624,198 at | | | |
| June 30, 2004 and December 31, 2003 | 24,624 | | 24,624 |
| Additional Paid-in Capital | 4,775,977 | | 4,775,977 |
| Accumulated Deficit | (4,837,198) | | (4,830,544) |
| Total Stockholders' Equity | (36,597) | | (29,943) |
| | | |
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ - | | $ - |
| | | |
The accompanying notes are an integral part of these financial statements.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
| For the Three Months | | For the Six Months |
| Ended | | Ended |
| June 30, | | June 30, |
| 2004 | | 2003 | | 2004 | | 2003 |
| | | | | | | |
| REVENUES | $ - | | $ - | | $ - | | $ - |
| | | | | | | |
| OPERATING EXPENSES | | | | | | | |
| General & Administrative | 3,895 | | 9,790 | | 5,292 | | 14,095 |
| Total Operating Expense | (3,895) | | (9,790) | | (5,292) | | (14,095) |
| | | | | | | |
| OTHER INCOME (EXPENSE) | | | | | | | |
| Interest Expense | (681) | | (63,602) | | (1,362) | | (126,978) |
| Gain on Settlement of Liabilities | - | | - | | - | | 6,343 |
| Total Other Income (Expense) | (681) | | (63,602) | | (1,362) | | (120,635) |
| | | | | | | |
| NET LOSS | $ (4,576) | | $ (73,392) | | $ (6,654) | | $ (134,730) |
| | | | | | | |
| NET LOSS PER COMMON SHARE | $ - | | $ (0.07) | | $ - | | $ (0.13) |
| | | | | | | |
| WEIGHTED AVERAGE NUMBER OF | | | | | | | |
| OUTSTANDING (BASIC & DILUTED) | 24,624,198 | | 1,077,000 | | 24,624,198 | | 1,077,000 |
| | | | | | | |
The accompanying notes are an integral part of these financial statements.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
| | For the Six Months Ended |
| | June 30, |
| | 2004 | | 2003 |
| CASH FLOWS FROM OPERATING ACTIVITIES: | | | | |
| Net Loss | | $ (6,654) | | $ (134,730) |
| Adjustments to reconcile net loss to net cash used in | | | | |
| operating activities: | | | | |
| Expense related to issuance of common stock | | | | |
| and common stock options for services | | - | | - |
| Changes in Assets and Liabilities: | | | | |
| Increase (Decrease) Accounts Payable | | 5,292 | | 7,752 |
| Increase (Decrease) Interest Payable | | 1,362 | | 126,978 |
| | | | |
| Net Cash Used in Operating Activities | | - | | - |
| | | | |
| CASH FLOWS FROM INVESTING ACTIVITIES: | | | | |
| Net Cash Used in Investing Activities | | - | | - |
| | | | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | | | | |
| Proceeds from Notes payable | | - | | - |
| Proceeds from Issuance of Common Stock | | - | | - |
| Net Cash Provided by Financing Activities | | - | | - |
| | | | |
| NET INCREASE IN CASH | | - | | - |
| CASH AT BEGINNING OF THE YEAR | | - | | - |
| CASH AT END OF THE YEAR | | $ - | | $ - |
| | | | |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW | | | | |
| Cash paid during the year for interest | | $ - | | $ - |
| | | | |
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING & FINANCING ACTIVITIES:
None.
The accompanying notes are an integral part of these financial statements.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
NOTES TO THE FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
This summary of accounting policies for Hampton Berkshire Insurance and Financial, Inc. is presented to assist in understanding the Company's financial statements. The accounting policies conform to generally accepted accounting principles in the United States of America and have been consistently applied in the preparation of the financial statements.
Interim Reporting
The unaudited financial statements as of June 30, 2004 and for the three and six month period then ended, in the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to fairly state the financial position and results of operations for the three and six months. Operating results for interim periods are not necessarily indicative of the results which can be expected for full years.
Organization
Hampton Berkshire Insurance and Financial, Inc. formally known as First Capital Resources.com, Inc. (the "Company") is a Nevada corporation, having first been incorporated under the name Jackal Industries, Inc., pursuant to the laws of Utah on April 16, 1986, and subsequently reorganized under the laws of Nevada on December 30, 1993. During 1998, the Company ceased all business operations. The Company's name was changed to First Capital Resources.com, Inc., on April 13, 1999. On February 7, 2003 the Company changed its name to Hampton Berkshire Insurance and Financial, Inc. The Company has no products or services as of June 30, 2004.
Nature of Operations
The Company intends to acquire interests in various business opportunities, which in the opinion of management will provide a profit to the Company. In seeking a business opportunity to merge with or acquire, management is reviewing various business plans. Management has not limited their review of plans or exploration of acquisitions to any particular industry or service sector. Management has not yet identified a business to complete such a transaction with and the Company has not entered into any binding agreements for an acquisition or merger. There is no assurance that the Company will be successful in finding any business opportunity to merge with or acquire.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
Continued
NOTE 1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
Basis of Presentation
The Company's financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustment relating to recoverability and classification of recorded amounts of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company has a substantial deficiency in assets.
The Company still has no operations and no funds to develop operations and there remains no assurance any successful operations will be located. Presently, management's plans are to continue to evaluate business opportunities that may come available to the Company.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.
Income Taxes
The Company accounts for income taxes using the asset and liability method. Deferred income taxes are determined based on the estimated future tax effects of differences between the financial reporting and tax reporting bases of assets and liabilities given the provisions of currently enacted tax laws. A valuation allowance is provided when it is more likely than not that all or some portion of the deferred income tax asset will not be realized.
Net Loss Per Common Share
Basic net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the year. Diluted net loss per common share ("Diluted EPS") reflects the potential dilution that could occur if stock options or other common stock equivalents were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an antidilutive effect on net loss per common share.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
Continued
NOTE 1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
Comprehensive Income
There are no components of comprehensive income other than the net loss.
Derivative and Hedging Activities
Statement of Financial Accounting Standards (SFAS) No. 133,Accounting for Derivative Instruments and Hedging Activities, as amended, requires that all derivative instruments be recognized as either assets or liabilities at fair market value. The adoption of this statement on January 1, 2001 had no impact on the Company.
NOTE 2 - INCOME TAXES
Realization of the deferred tax asset is dependent on generating sufficient taxable income prior to expiration of the loss carryforwards. Management believes, based upon the short operating period of the Company and the bankruptcy of the 92.85% Parent of the Company (Note 4), among other things, the uncertainty of generating taxable income is such that it is more likely than not that none of the deferred tax asset will be realized, and accordingly has established a valuation allowance of $835,000 fully offsetting this asset. It is reasonably possible the Company's estimate of realizability of the deferred tax asset could materially change in the near term. Further, all or substantially, all of the deferred tax asset may be lost due to the change in ownership on December 31, 2002.
NOTE 3 - COMMITMENTS
The Company currently maintains its corporate presence from the office of the Company's legal counsel and pays no rent or expenses.
NOTE 4 - COMMON STOCK TRANSACTIONS
On December 27, 2000, FACT South entered into a compromise agreement with FACT pursuant to which FACT South satisfied and retired a portion of the indebtedness owed by FACT South to FACT by transferring all its assets to FACT. FACT South's primary asset was 1,000,000 shares of stock in the registrant, accounting for approximately 92.85% of the issued and outstanding stock of the registrant.
HAMPTON BERKSHIRE INSURANCE AND FINANCIAL, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
Continued
NOTE 4 - COMMON STOCK TRANSACTIONS (Continued)
Effective December 31, 2002, First American Capital Liquidating Trust ("the Trust"), majority owner of First Capital Resources.com, Inc. ("the Company"), sold to a third party, 950,000 of the million shares owned by the Trust for $130,000. In anticipation of divesting their equity ownership of the Company, the former parent assigned to the $2,635,3722 debt owed by the Company.
Effective December 31, 2002, the Company successfully canceled $31,476 in debt owed to First American Capital Liquidating Trust in exchange for $13,704 in cash and assignment of a receivable with a face value of approximately $18,000.
On March 5, 2003, the Board of Directors changed the name of the Company to Hampton Berkshire Insurance and Financial, Inc. The Board initiated a 1 for 10 reverse split of common stock and increased the number of shares authorized to 150,000,000, consisting of 125,000,000 common shares and 25,000,000 preferred shares to have such designations, preferences and rights as determined by the board.
During the first fiscal quarter of 2003, the Company rescinded a long-term incentive plan for employees and consultants and a director option plan for outside directors, which had been adopted during the same quarter of 2003 and reported in an 8-K filing.
During the third quarter of 2003, three creditors converted debt to an aggregate of 22,266,800 shares of the Company's common stock.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
The following presentation of management's discussion and analysis of the Company's financial condition and results of operation should be read in conjunction with the Company's financial statements and notes contained herein.
Liquidity and Capital Resources. The Company has no assets and is currently in the process of looking for business opportunities to merge with or acquire. At minimum, the Company will need to raise additional capital through private funding to meet the financial needs of being a reporting company and to meet the obligations of the current accounts payable. In the past, the Company has funded its operations from the sale of its products, the sale of common stock and loans from various sources. However, at this time, the Company no longer has any business operations. The Company is currently searching for a business opportunity to acquire or merge with. There is no guarantee that the Company will be successful in obtaining necessary funding to develop any business opportunities.
For the Three Months Ended . The Company reported a net loss of $4,576 and $73,392 for the quarters ended June 30, 2004, and June 30, 2003, respectively.
For the Six Months Ended. The Company reported a net loss of $6,654 and $134,730 for the quarters ended June 30, 2004 and June 30, 2003, respectively. The Company anticipates very little or no overhead from future operations other than interest, professional fees and costs associated with being a public company, unless and until a successor business can be acquired or merged.
Plan of Operations. The Company is currently in the process of looking for business opportunities to acquire or merge with. There is no guarantee that management will be successful in finding such an opportunity.
ITEM 3 - CONTROLS AND PROCEDURES.
The Company's Chief Executive Officer and Chief Financial Officer have concluded, based on an evaluation conducted within 90 days prior to the filing date of this Quarterly Report on Form 10-QSB, that the Company's disclosure controls and procedures have functioned effectively so as to provide those officers the information necessary whether:
(i) this Quarterly Report on Form 10-QSB contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Quarterly Report on Form 10-QSB, and
(ii) the financial statements, and other financial information included in this Quarterly Report on Form 10-QSB, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this Quarterly Report on Form 10-QSB.
There have been no significant changes in the Company's internal controls over financial reporting or in other factors since the date of the Chief Executive Officer's and Chief Financial Officer's evaluation that could significantly affect these internal controls, including any corrective actions with regards to significant deficiencies and material weaknesses.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8
(a) Exhibits. The following exhibits are filed with this report.
31. Written Statement of Chief Executive Officer and Chief Financial Officer with respect to compliance with Section 13(a) or 15 (d) of the Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of 2002.
32. Written Statement of Chief Executive Officer and Chief Financial Officer with respect to compliance with Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and pursuant to 18 U.S.C. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K. The following reports have been filed on Form 8-K during the last fiscal quarter:
None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned authorized officer.
Dated: August 12, 2004 Hampton Berkshire Insurance & Financial, Inc.
By: /s/ Lionel Drage Lionel Drage
Exhibit 31
SECTION 302 CERTIFICATION
I, Lionel Drage, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Hampton Berkshire Insurance and Financial, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in exchange act rules 13a-14 and 15d-14 for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a) all significant deficiencies in the design or operation of internal control which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls.
6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of my most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
Date: August 12, 2004 /s/ Lionel Drage
Lionel Drage Chief Executive Officer And Principal Accounting Officer
Exhibit 32
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT BY
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Hampton Berkshire Insurance and Financial, Inc., on Form 10-QSB for the period ending June 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the"Report"), the undersigned, Lionel Drage, Chief Executive Officer and Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
Date: August 12, 2004 /s/ Lionel Drage_ _____________________
Lionel Drage, Chief Executive Officer
and Principal Accounting Officer
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
