U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED: September 30, 2010
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 333-126514
BAROSSA COFFEE COMPANY, INC.
(Exact name of registrant as specified in its charter)
NEVADA 20-2641871
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
650 N. Saddlehill Rd., Salt Lake City, Utah 84103
(Address of principal executive offices)
(801) 364-9264
(Registrant's telephone number, including area code)
311 S. State, Suite 460, Salt Lake City, Utah 84111
(Former name or former address, if changed since last report)
Check whether the issuer (1) 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 is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange Act.
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 Exchange Act). Yes X No
Number of shares outstanding of the Issuer's common stock as of September 30,
2010: 2,334,100
FORWARD-LOOKING STATEMENT NOTICE
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 regarding
events, conditions, and financial trends that may affect the Company's future
plan 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 include general economic factors and conditions that may directly
or indirectly impact the Company's financial condition or results of
operations. Readers are cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date the statement was
made.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
See attached.
ITEM 2. MANAGEMENT'S DISCUSSION & ANALYSIS OR PLAN OF OPERATIONS
Barossa Coffee Company, Inc. is a small start up company that was
incorporated in March 2005, and is considered a development stage company. In
July, 2005, the Company filed a registration statement on Form SB-2 with the
U.S. Securities & Exchange Commission under the Securities Act of 1933, to
register an offering, on a "best efforts minimum/maximum" basis, of up to
400,000 shares of $.001 par value common stock, at a price of $0.25 per share.
The registration statement was declared effective September 20, 2005. The
Company sold 298,000 shares of common stock pursuant to the offering. The
offering closed November 30, 2005, and raised gross proceeds of $74,500.
Barossa was formed to open and operate, through a wholly-owned
subsidiary, Alchemy Coffee Company, Inc., a retail, specialty coffee outlet.
The Company opened a retail coffee outlet featuring specialty coffees in
February, 2006 and utilized the experience of management in the coffee/cafe
industry to specialize in the sale of the highest quality, fresh locally-
roasted coffee beans and espresso related beverages; as well as organic food
and baked goods, teas, juices, and specific health foods and beverages.
However, even though the Company generated revenues from operations of $60,691
for the fiscal year ended June 30, 2006, and $55,047 for the quarter ended
September 30, 2006, operating losses of $19,672 for the fiscal year ended June
30, 2006, and $7,009 for the quarter ended September 30, 2006, forced it to
seek additional funding, which it borrowed from shareholders.
Due to these continuing cash needs of Alchemy which could not be met by
the Corporation, management and principal shareholders negotiated and reached
a Stock Exchange Agreement on October 11, 2006, between the Corporation and
Jason Briggs, manager of the coffee shop, wherein Briggs received all of the
issued and outstanding common stock of Alchemy Coffee Company, Inc. in
exchange for all 200,000 shares of the Corporation's common stock beneficially
owned by Briggs, which were then surrendered to the Corporation and cancelled.
The Company determined that since the inception of Alchemy as a wholly-owned
subsidiary, $55,715 had been advanced to Alchemy and not repaid. The
Corporation determined that the value of Alchemy was substantially less than
the amount invested and that the 200,000 shares it received as consideration
for Alchemy had at least as great a value as Alchemy and that this was the
best value that could be received by the Company for Alchemy and that this
transaction was in the best interests of the Company. With this transaction,
the Company is not engaged in any business activities and has no operations.
The Company's principal activity is to investigate potential acquisitions.
There is no assurance the Company can become involved with any business
venture in the future. During the fiscal year ended June 30, 2007, 200,000
shares were cancelled and 160,000 shares were issued. On November 10, 2008,
126,000 shares of common stock were issued for consideration of $12,600 cash.
On December 31, 2009 the Company sold 75,050 shares of its restricted common
stock at $.10 per share, and again on March 18, 2010, another 75,050 shares,
bringing the current total number of outstanding shares to 2,334,100.
PLAN OF OPERATIONS.
The Company does not expect to generate any meaningful revenue or incur
operating expenses, except for administrative, legal, professional, accounting
and auditing costs associated with the filing requirements of a public
reporting company, unless and until it acquires an interest in another
operating company. The Company may not have sufficient cash to meet its
operational needs for the next twelve months.
Management's plan of operation for the next twelve months is to attempt
to raise additional capital through loans from related parties, debt
financing, equity financing or a combination of financing options. Currently,
there are no understandings, commitments or agreements for such an infusion of
capital and no assurances to that effect. Unless the Company can obtain
additional financing, its ability to continue as a going concern during the
next twelve-month period is doubtful. The Company's need for capital may
change dramatically if and during that period, it acquires an interest in a
business opportunity.
The Company's current operating plan is to (i) handle the administrative
and reporting requirements of a public company, and (ii) search for potential
businesses, products, technologies and companies for acquisition. At present,
the Company has no understandings, commitments or agreements with respect to
the acquisition of any business venture, and there can be no assurance that
the Company will identify a business venture suitable for acquisition in the
future. Further, there can be no assurance that the Company would be
successful in consummating any acquisition on favorable terms or that it will
be able to profitably manage any business venture it acquires.
The accompanying financial statements have been prepared in conformity
with accounting principles generally accepted in the United States of America,
which contemplate continuation of the Company as a going concern. However,
the Company has incurred losses since its inception, and has not been
successful in establishing profitable operations. These factors raise
substantial doubt about the ability of the Company to continue as a going
concern. In this regard, management is proposing to raise any necessary
additional funds not provided by operations through loans and/or through
additional sales of its common stock. There is no assurance that the Company
will be successful in raising this additional capital or in achieving
profitable operations. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Company has no market risk sensitive instruments entered into for
trading purposes or entered into for other than trading purposes.
ITEM 4. CONTROLS AND PROCEDURES.
(a) Evaluation of Disclosure Controls and Procedures. Our management,
with the participation of our President, evaluated the effectiveness of our
disclosure controls and procedures as of the end of the period covered by this
report (the quarter ended September 30, 2010). Based on that evaluation, our
President concluded that our disclosure controls and procedures as of the end
of the period covered by this report were effective such that the information
required to be disclosed by us in reports filed under the Securities Exchange
Act of 1934 is (i) recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and forms and (ii) accumulated and
communicated to our management, including our President, as appropriate to
allow timely decisions regarding disclosure. A controls system cannot provide
absolute assurance, however, that the objectives of the controls system are
met, and no evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, within a company have been
detected.
(b) Management's Annual Report on Internal Control over Financial
Reporting. Our management is responsible for establishing and maintaining
adequate internal control over financial reporting (as defined in Rule 13a-
15(f) under the Exchange Act). Our internal control over financial reporting
is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes using accounting principles generally accepted in the
United States. Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Therefore, even
those systems determined to be effective can provide only reasonable assurance
of achieving their control objectives.
Our management, with the participation of the President, evaluated the
effectiveness of the Company's internal control over financial reporting as of
June 30, 2010, for the fiscal year then ended.
In making this assessment, our management used the criteria set forth by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in
Internal Control - Integrated Framework. Based on this evaluation,
our management, with the participation of the President, concluded that, as of
the fiscal year ended June 30, 2010, our internal control over financial
reporting was effective.
An unavoidable weakness in the Company's internal controls is that the
principal executive officer and principal financial officer are the same
individual, which does not allow for segregation of duties. Since the Company
is a shell company, management does not feel that this has a material effect
on the accuracy and completeness of our financial reporting and disclosure
included in this report.
(c) Changes in Internal Control over Financial Reporting. There were
no changes in the Company's internal controls over financial reporting, known
to the chief executive officer or the chief financial officer that occurred
during the period covered by this report (the quarter ended September 30,
2010), that have materially affected, or are reasonably likely to materially
affect, the Company's internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not a party to any material pending legal proceedings. No
such action is contemplated by the Company nor, to the best of its knowledge,
has any action been threatened against the Company.
ITEM 2. SALES OF UNREGISTERED EQUITY SECURITIES AND USE OF PROCEEDS
(a) During the period covered by this report (the quarter ended
September 30, 2010), there were no equity securities of the
issuer, sold by the issuer, that were not registered under the
Securities Act.
(b) During the period covered by this report (the quarter ended
September 30, 2010), there were no securities that the issuer sold
by registering the securities under the Securities Act.
(c) During the period covered by this report, there was no repurchase
made of equity securities registered pursuant to section 12 of the
Exchange Act. The issuer's securities are not registered pursuant
to section 12 of the Exchange Act.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There has not been any material default in the payment of principal,
interest, a sinking or purchase fund installment, or any other material
default not cured within 30 days, with respect to any indebtedness of the
issuer exceeding five percent of the total assets of the issuer.
ITEM 4. (REMOVED AND RESERVED).
ITEM 5. OTHER INFORMATION
We have no office facilities but for now the business address of Lynn
Dixon, a principal shareholder, is being used as the business address of the
Company. Lynn Dixon is changing his business address to 650 N. Saddlehill Rd.,
Salt Lake City, Utah 84103, as of November, 2010. No reports on Form 8-K were
filed during the period covered by this report.
ITEM 6. EXHIBITS.
All documents previously filed by the Company pursuant to the Securities
Act of 1933 and the Securities Exchange Act of 1934, to the extent applicable
to the period covered by this report, are incorporated herein as exhibits to
this report by reference to the registration statements and other reports
previously filed by the Company to which such documents were filed as
exhibits.
Exhibit Index - Exhibits not previously filed that are applicable to the
period covered by this report and required by Item 601 of Regulation S-K.
(31) Certifications required by Rules 13a-14(a) or 15d-14(a).
(32) Section 1350 Certifications
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2010
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
CONTENTS
PAGE
- Condensed Balance Sheets,
September 30, 2010 (Unaudited) and June 30, 2010 3
- Unaudited Condensed Statements of Operations,
for the three months ended September 30, 2010
and 2009 and from inception on March 24, 2005
through September 30, 2010 4
- Unaudited Condensed Statements of Cash Flows,
for the three months ended September 30, 2010
and 2009 and from inception on March 24, 2005
through September 30, 2010 5
- Notes to Unaudited Condensed Financial Statements 6 - 8
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
September June 30,
30,
2010 2010
(Unaudited)
_________ __________
ASSETS
Current Assets
Cash $ 581 $ 3,388
_________ __________
Total Current Assets 581 3,388
_________ __________
Total Assets $ 581 $ 3,388
_________ __________
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts Payable $ 4,392 $ 2,808
Interest Payable - related parties 1,342 1,277
Loans Payable -- related parties 4,240 4,240
_________ __________
Total Current Liabilities 9,974 8,325
_________ __________
Stockholders' Equity (Deficit)
Preferred stock, $.001 par value,
1,000,000 shares authorized,
no shares issued and outstanding $ - $ -
Common stock, $.001 par value,
50,000,000 shares authorized,
2,334,100 shares issued
and outstanding 2,334 2,334
Capital in excess of par value 128,228 128,228
(Deficit) accumulated during the
development stage (139,955) (135,499)
_________ __________
Total Stockholders'
Equity (Deficit) (9,393) (4,937)
_________ __________
Total Liabilities and
Stockholders' Equity (Deficit) $ 581 $ 3,388
_________ __________
The accompanying notes are an integral part of these unaudited condensed
financial statements.
-3-
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three From Inception
Months Ended on March 24,
September 30, 2005 Through
__________________ September 30,
2010 2009 2010
________ ________ _________
REVENUE $ - $ - $ -
EXPENSES:
General and administrative 4,391 6,325 83,098
________ ________ _________
LOSS FROM OPERATIONS BEFORE
OTHER INCOME (EXPENSE) (4,391) (6,325) (83,098)
________ ________ _________
OTHER INCOME (EXPENSE):
Interest expense (65) (64) (1,342)
________ ________ _________
Total Other Income (Expense) (65) (64) (1,342)
________ ________ _________
LOSS BEFORE INCOME TAXES (4,456) (6,389) (84,440)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
________ ________ _________
LOSS FROM CONTINUING OPERATIONS (4,456) (6,389) (84,440)
________ ________ _________
DISCONTINUED OPERATIONS:
Loss from operations of
discontinued coffee sales
business (net of $0
in income taxes) - - (11,087)
Gain (loss) on disposal of
discontinued Operations
(net of $0 in income taxes) - - -
________ ________ _________
LOSS FROM DISCONTINUED OPERATIONS - - (11,087)
________ ________ _________
NET LOSS $(4,456) $(6,389) $(95,527)
________ ________ _________
LOSS PER COMMON SHARE:
Continuing operations $ (.00) $ (.00)
Discontinued operations - -
________ ________
Net Loss Per Common Share $ (.00) $ (.00)
________ ________
The accompanying notes are an integral part of these unaudited condensed
financial statements.
-4-
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the Three From Inception
Months Ended on March 24,
September 30, 2005 Through
____________________ September 30,
2010 2009 2010
_________ _________ __________
Cash Flows from Operating Activities:
Net loss $ (4,456) $ (6,389) $ (95,527)
Adjustments to reconcile net loss
to net cash provided
(used) by operating activities:
Depreciation 8,558
Changes in assets and liabilities:
(Decrease)/increase
in accounts payable 1,584 3,725 11,797
(Increase) in deposits - - (865)
Increase in accrued interest payable 65 64 1,568
(Decrease) in subsidiary cash
upon disposal of Subsidiary - - (1,281)
_________ _________ __________
Net Cash Provided (Used)
by Operating Activities (2,807) (2,600) (75,750)
_________ _________ __________
Cash Flows from Investing Activities:
Acquisition of property and equipment - - (69,561)
Refund on property and equipment costs - - 8,990
_________ _________ __________
Net Cash Provided (Used)
by Investing Activities - - (60,571)
_________ _________ __________
Cash Flows from Financing Activities:
Proceeds from common stock issuance - - 130,762
Proceeds from notes payable - - 12,750
Payments on notes payable - - (6,610)
_________ _________ __________
Net Cash Provided (Used)
by Financing Activities - - 136,902
_________ _________ __________
Net Increase (Decrease) in Cash (2,807) (2,600) 581
Cash at Beginning of Period 3,388 3,460 -
_________ _________ ___________
Cash at End of Period $ 581 $ 860 $ 581
_________ _________ ___________
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Supplemental Schedule of Non-cash Investing and Financing Activities:
For the three months ended September 30, 2010
None
For the three months ended September 30, 2009
None
The accompanying notes are an integral part of these unaudited condensed
financial statements.
-5-
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Barossa Coffee Company, Inc. ("Parent") was organized under
the laws of the State of Nevada on March 24, 2005.
Alchemy Coffee Company, Inc. ("Subsidiary") was organized under the laws of
the State of Utah on April 22, 2005 as a wholly-owned subsidiary of Parent.
In October 2006 the Parent and Subsidiary entered into an agreement to
terminate their relationship.
Barossa Coffee Company, Inc. and Subsidiary (the "Company") previously sold
coffee beans and espresso related beverages. The Company has not yet
generated significant revenues from their planned principal operations and
is considered a development stage company. The Company has, at the present
time, not paid any dividends and any dividends that may be paid in the
future will depend upon the financial requirements of the Company and other
relevant factors.
Consolidation - The financial statements include the operations of Parent
and its wholly-owned Subsidiary through September 30, 2006. The operations
of subsidiary were discontinued effective September 30, 2006. All
significant inter-company transactions have been eliminated in
consolidation.
Condensed Financial Statements - The accompanying financial statements have
been prepared by the Company without audit. In the opinion of management,
all adjustments (which include only normal recurring adjustments) necessary
to present fairly the financial position, results of operations and cash
flows at September 30, 2010 have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted.
It is suggested that these condensed financial statements be read in
conjunction with the financial statements and notes thereto included in the
Company's June 30, 2010 audited financial statements. The results of
operations for the period ended September 30, 2010 are not necessarily
indicative of the operating results for the full year.
NOTE 2 - RELATED PARTY TRANSACTIONS
Management Compensation - The Company has not paid any compensation to its
officers and directors, as the services provided by them to date have only
been nominal.
Loans Payable - The Company's loan payable is due to a shareholder, has an
interest rate of 6%, is due on demand, and is unsecured with a balance due
of $4,240 and accrued interest of $1,342 at September 30, 2010.
-6-
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 3 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America,
which contemplate continuation of the Company as a going concern. However,
the Company has incurred losses since inception and has not yet been
successful at establishing profitable operations. These factors raise
substantial doubt about the ability of the Company to continue as a going
concern. In this regard, management is proposing to raise any necessary
additional funds not provided by operations through loans or through
additional sales of its common stock. There is no assurance that the
Company will be successful in raising this additional capital or in
achieving profitable operations. The financial statements do not include
any adjustments that might result from the outcome of these uncertainties.
NOTE 4 - LOSS PER SHARE
The following data show the amounts used in computing loss per share:
For the three months ended
September 30, September 30,
2010 2009
__________ ___________
Loss from continuing operations
(numerator) $ (4,456) $ (6,389)
Loss from discontinued operations
(numerator) - -
Gain (loss) on disposal of
discontinued operations
(numerator) - -
__________ ___________
Loss available to
common shareholders
(numerator) $ (4,456) $ (6,389)
__________ ___________
Weighted average number
of common shares outstanding
used in loss per share
during the period
(denominator) 2,334,100 2,184,000
__________ ___________
Dilutive loss per share was not presented, as the Company had no common
equivalent shares for all periods presented that would affect the
computation of diluted loss per share.
NOTE 5 - SUBSEQUENT EVENTS
On November 1, 2010, the Company sold 2,400,000 shares of its restricted
common stock at $.00625 per share of which $2,400 will be credited to
common stock and $12,600 will be credited to capital in excess of par
value. The stock issuance was exempt from any state or federal securities
registration requirements as an isolated nonpublic sale to accredited
investors. The sum of $15,000 shall be paid by the purchasers by paying
1/2 down ($7,500) and balance due no later than May 1, 2011.
-7-
BAROSSA COFFEE COMPANY, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 5 - SUBSEQUENT EVENTS - CONTINUED
The Company has evaluated other subsequent events from the balance sheet
date through the date the financial statements were issued and found there
are no other events to report.
-8-
SIGNATURES
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.
Barossa Coffee Company, Inc.
Date: November 12, 2010 by: /s/ Adam Gatto
Adam Gatto, President and Director