SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2012
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 000-54591
HARDWOOD ACQUISITION CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 00-0000000
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9454 Wilshire Boulevard, Suite 612
Beverly Hills, California 90212
(Address of principal executive offices) (zip code)
202/387-5400
(Registrant's telephone number, including area code)
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 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
(do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of stock, as of the latest practicable date.
Class Outstanding at
March 31, 2012
Common Stock, par value $0.0001 20,000,000
Documents incorporated by reference: None
FINANCIAL STATEMENTS
Balance Sheets as of March 31, 2012 (unaudited) and
December 31, 2011 2
Statements of Operations for the Three Months Ended
March 31, 2011 and for the Period from December 13, 2011
(Inception) to March 31, 2012 (unaudited) 3
Statements of Cash Flows for the Three Months Ended
March 31, 2012 and for the Period from December 13, 2011
(Inception) to March 31, 2012 (unaudited) 4
Notes to Financial Statements (unaudited) 5-8
HARDWOOD ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
ASSETS
March 31, December 31,
2012 2011
---------- ------------
(Unaudited)
Current assets
Cash $ 2,000 $ 2,000
-------- ---------
TOTAL ASSETS $ 2,000 $ 2,000
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accrued liabilities $ - $ 400
--------- ----------
Total liabilities 400
--------- ----------
Stockholders' Equity
Preferred stock, $0.0001 par value
20,000,000 shares authorized;
none issued and outstanding - -
Common Stock, $0.0001 par value,
100,000,000 shares authorized;
20,000,000 shares issued and
outstanding 2,000 2,000
Additional paid-in capital 2,093 943
Accumulated deficit (2,093) (1,343)
--------- ---------
Total stockholders' equity 2,000 1,600
--------- ---------
TOTAL LIABLILITIES AND
STOCKHOLDERS' EQUITY $ 2,000 $ 2,000
========= =========
The accompanying notes are an integral part of these financial statements.
2
HARDWOOD ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(unaudited)
For the three For the period
months ended from December 13,
March 31, 2011 (Inception)
2012 to March 31, 2012
------------- ---------------
<c> <c>
Revenues $ - $ -
Cost of revenues - -
------------- --------------
Gross profit - -
------------- --------------
Operating expenses 750 2,093
------------- --------------
Net loss $ (750) $ (2,093)
============= ==============
Loss per share - basic and diluted $ -
=============
Weighted average shares - 20,000,000
basic and diluted =============
The accompanying notes are an integral part of these financial statements.
3
HARDWOOD ACQUISITION CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(Unaudited)
For the For the Period from
three months December 13, 2011
ended March 31, (Inception) to
2012 March 31, 2012
-------------- ----------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (750) $ (2,093)
Changes in assets and liabilities
Accrued liabilities (400) -
------------ ------------
Net cash used in operating activities (1,150) (2,093)
------------ ------------
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock - 2,000
Proceeds from stockholders' additional
paid-in capital 1,150 2,093
------------ ------------
Net cash provided by financing activities 1,150 4,093
------------ ------------
Net increase in cash - 2,000
Cash at beginning of period 2,000 -
------------ ------------
Cash at end of period $ 2,000 $ 2,000
============ ============
The accompanying notes are an integral part of these financial statements.
4
Hardwood Acquisition Corporation
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT POLICIES
NATURE OF OPERATIONS
Hardwood Acquisition Corporation ("Hardwood" or "the Company")
was incorporated on December 13, 2011 under the laws of the State of
Delaware to engage in any lawful corporate undertaking, including,
but not limited to, selected mergers and acquisitions. Hardwood has
been in the developmental stage since inception and its operations to
date have been limited to issuing shares to its original shareholders.
Hardwood will attempt to locate and negotiate with a business entity for
the combination of that target company with Hardwood. The combination will
normally take the form of a merger, stock-for-stock exchange or stock-
for-assets exchange. In most instances the target company will wish to
structure the business combination to be within the definition of a
tax-free reorganization under Section 351 or Section 368 of the Internal
Revenue Code of 1986, as amended. No assurances can be given that Hardwood
will be successful in locating or negotiating with any target company.
Hardwood has been formed to provide a method for a foreign or domestic
private company to become a reporting company with a class of securities
registered under the Securities Exchange Act of 1934.
BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared
pursuant to the rules and regulations of the Securities and Exchange
Commission (SEC) for interim financial information. Accordingly, they do
not include all of the information and notes required by U.S. GAAP for
complete financial statements. The accompanying unaudited financial
statements include all adjustments, composed of normal recurring
adjustments, considered necessary by management to fairly state our results
of operations, financial position and cash flows. The operating results for
interim periods are not necessarily indicative of results that may be
expected for any other interim period or for the full year. These unaudited
financial statements should be read in conjunction with the financial
statements and notes thereto included in our Annual Report on Form 10-K
for the year ended December 31, 2011 (2011 Form 10-K) as filed with the
SEC.
USE OF ESTIMATES
The preparation of financial statements in conformity with GAAP 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 periods. Actual
results could differ from those estimates.
CONCENTRATION OF RISK
Financial instruments that potentially subject the Company to concentrations
of credit risk consist principally of cash. The Company places its cash with
high quality banking institutions. The Company did not have cash balances
in excess of the Federal Deposit Insurance Corporation limit as of March 31,
2012 and December 31, 2011.
INCOME TAXES
Under ASC 740, "Income Taxes", deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary
differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. 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. Valuation allowances are established
when it is more likely than not that some or all of the deferred tax assets
will not be realized.
5
Hardwood Acquisition Corporation
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
LOSS PER COMMON SHARE
Basic loss per common share excludes dilution and is computed by dividing
net loss by the weighted average number of common shares outstanding
during the period. Diluted loss per common share reflects the potential
dilution that could occur if securities or other contracts to issue common
stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the loss of the entity. As
of March 31, 2012 and December 31, 2011, there are no outstanding
dilutive securities.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company follows guidance for accounting for fair value measurements
of financial assets and financial liabilities and for fair value
measurements of nonfinancial items that are recognized or disclosed at fair
value in the financial statements on a recurring basis. Additionally, the
Company adopted guidance for fair value measurement related to nonfinancial
items that are recognized and disclosed at fair value in the financial
statements on a nonrecurring basis. The guidance establishes a fair value
hierarchy that prioritizes the inputs to valuation techniques used to
measure fair value. The hierarchy gives the highest priority to unadjusted
quoted prices in active markets for identical assets or liabilities (Level
1 measurements) and the lowest priority to measurements involving
significant unobservable inputs (Level 3 measurements). The three levels
of the fair value hierarchy are as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for
identical assets or liabilities that the Company has the ability
to access at the measurement date.
Level 2 inputs are inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly or indirectly.
Level 3 inputs are unobservable inputs for the asset or liability.
NOTE 2 - GOING CONCERN
The Company has sustained operating losses since inception. It has an
accumulated deficit of $2,093 as of March 31, 2012. The Company's
continuation as a going concern is dependent on its ability to generate
sufficient cash flows from operations to meet its obligations, which it has
not been able to accomplish to date, and /or obtain additional financing
from its stockholders and/or other third parties.
These financial statements have been prepared on a going concern basis,
which implies the Company will continue to meet its obligations and
continue its operations for the next fiscal year. The continuation of the
Company as a going concern is dependent upon financial support from its
stockholders, the ability of the Company to obtain necessary equity
financing to continue operations, successfully locating and negotiate with
a business entity for the combination of that target company with the
Company.
6
Hardwood Acquisition Corporation
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Tiber Creek Corporation, a company affiliated with management, will pay
all expenses incurred by the Company until a business combination is
effected, without repayment. There is no assurance that the Company
will ever be profitable. The financial statements do not include any
adjustments to reflect the possible future effects on the recoverability
and classification of assets or the amounts and classifications of
liabilities that may result should the Company be unable to continue
as a going concern.
NOTE 3 - RECENT ACCOUNTING PRONOUNCEMENTS
Adopted
In May 2011, the FASB issued ASU 2011-04, "Amendments to Achieve
Common Fair Value Measurement and Disclosure Requirements in U.S.
GAAP and International Financial Reporting Standards (IFRS) of Fair Value
Measurement Topic 820." ASU 2011-04 is intended to provide a
consistent definition of fair value and improve the comparability of fair
value measurements presented and disclosed in financial statements
prepared in accordance with U.S. GAAP and IFRS. The amendments include
those that clarify the FASB's intent about the application of existing
fair value measurement and disclosure requirements, as well as those that
change a particular principle or requirement for measuring fair value or
for disclosing information about fair value measurements. This update is
effective for annual and interim periods beginning after December 15, 2011.
The adoption of this ASU did not have a material impact on the Company's
financial statements.
NOTE 4 STOCKHOLDER'S EQUITY
The Company is authorized to issue 100,000,000 shares of common stock
and 20,000,000 shares of preferred stock.
As of March 31, 2012, 20,000,000 shares of common stock and no preferred
stock were issued and outstanding.
There were no equity transactions in the three months ended March 31,
2012.
NOTE 5 SUBSEQUENT EVENTS
In preparing these financial statements, the Company has evaluated
events and transactions for potential recognition or disclosure through
May 15, 2012, the date the financial statements issued, and identified
no events or transactions that required recognition or disclosure.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Hardwood Acquisition Corporation ("Hardwood") was incorporated
on December 13, 2011 under the laws of the State of Delaware to engage in
any lawful corporate undertaking, including, but not limited to, selected
mergers and acquisitions. Hardwood has been in the developmental stage
since inception and its operations to date have been limited to issuing
shares to its original shareholders and filing a registration statement
on Form 10 with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934 as amended on January 27, 2012 to
register its class of common stock. Hardwood has been formed to provide
a method for a foreign or domestic private company to become a reporting
company with a class of securities registered under the Securities
Exchange Act of 1934.
The president of Hardwood is the president, director and
shareholder of Tiber Creek Corporation. Tiber Creek Corporation assists
companies in becoming public reporting companies and with introductions
to the financial community. In order to become a trading company,
Tiber Creek Corporation may recommend that a company file a registration
statement, most likely on Form S-1, following a business combination
with the target company.
Tiber Creek will typically enter into an agreement with the target
company for assisting it to become a public reporting company and for the
preparation and filing of a registration statement and the introduction to
brokers and market makers. The target company pays Tiber Creek
Corporation for such services. Such services include, if appropriate, the
use of Hardwood. Hardwood will only be used as part of such process
and is not offered for sale. If the target company chooses to enter into
business combination with Hardwood, the registration statement will be
prepared after such business combination. The terms of a business
combination may provide for redemption of all or part of their stock in
Hardwood, usually at par.
The most likely target companies are those seeking the perceived
benefits of a reporting corporation. Such perceived benefits may include
facilitating or improving the terms on which additional equity financing
may be sought, providing liquidity for incentive stock options or similar
benefits to key employees, increasing the opportunity to use securities
for acquisitions, providing liquidity for shareholders and other factors.
Business opportunities may be available in many different
industries and at various stages of development, all of which will
make the task of comparative investigation and analysis of such business
opportunities difficult and complex.
In analyzing prospective business opportunities, Hardwood may consider
such matters as the available technical, financial and managerial
resources; working capital and other financial requirements; history of
operations, if any; prospects for the future; nature of present and
expected competition; the quality and experience of management services
which may be available and the depth of that management; the potential
for further research, development, or exploration; specific risk factors
not now foreseeable but which may be anticipated; the potential for growth
or expansion; the potential for profit; the perceived public recognition
or acceptance of products, services, or trades; name identification; and
other relevant factors. This discussion of the proposed criteria is not
meant to be restrictive of the virtually unlimited discretion of Hardwood
to search for and enter into potential business opportunities.
A combination will normally take the form of a merger, stock-for-stock
exchange or stock-for-assets exchange. In most instances the target
company will wish to structure the business combination to be within the
definition of a tax-free reorganization under Section 351 or Section 368
of the Internal Revenue Code of 1986, as amended.
Hardwood has, and will continue to have, no capital with which to
provide the owners of business entities with any cash or other assets.
However, Hardwood offers owners of acquisition candidates the
opportunity to acquire a controlling ownership interest in a reporting
company.
As of March 31, 2012, Hardwood has not generated revenues and has
no income or cash flows from operations since inception. The continuation
of Hardwood as a going concern is dependent upon financial support from
its stockholders, its ability to obtain necessary equity financing to
continue operations, to successfully locate and negotiate with a business
entity for the combination of that target company with Hardwood. Tiber
Creek Corporation will pay all expenses incurred by Hardwood until a
change in control is effected, without repayment.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.
Information not required to be filed by Smaller reporting companies.
ITEM 4. Controls and Procedures.
Disclosures and Procedures
Pursuant to Rules adopted by the Securities and Exchange Commission,
the Company carried out an evaluation of the effectiveness of the design
and operation of its disclosure controls and procedures pursuant to
Exchange Act Rules. This evaluation was done as of the end of the
period covered by this report under the supervision and with the
participation of the Company's principal executive officer (who is
also the principal financial officer).
Based upon that evaluation, he believes that the Company's
disclosure controls and procedures are effective in gathering, analyzing
and disclosing information needed to ensure that the information
required to be disclosed by the Company in its periodic reports is
recorded, processed, summarized and reported, within the time periods
specified in the Commission's rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed
to ensure that information required to be disclosed by an issuer in the
reports that it files or submits under the Act is accumulated and
communicated to the issuer's management, including its principal executive
and principal financial officers, or persons performing similar functions,
as appropriate to allow timely decisions regarding required disclosure.
This Quarterly Report does not include an attestation report of
the Company's registered public accounting firm regarding internal
control over financial reporting. Management's report was not subject
to attestation by the Company's registered public accounting firm
pursuant to temporary rules of the Securities and Exchange
Commission that permit the Company to provide only management's
report in this Quarterly Report.
Changes in Internal Controls
There was no change in the Company's internal control over
financial reporting that was identified in connection with such
evaluation that occurred during the period covered by this report
that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting.
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are no legal proceedings against the Company and the Company
is unaware of such proceedings contemplated against it.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
During the past three years, Hardwood has issued 20,000,000
common shares pursuant to Section 4(2) of the Securities Act of 1933
for an aggregate purchase price of $2,000 as folllows:
On December 13, 2011, Hardwood issued the following shares of its
common stock:
Name Number of Shares Consideration
Tiber Creek Corporation 10,000,000 $1,000
MB Americus LLC 10,000,000 $1,000
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
(a) Not applicable.
(b) Item 407(c)(3) of Regulation S-K:
During the quarter covered by this Report, there have not been
any material changes to the procedures by which security holders
may recommend nominees to the Board of Directors.
ITEM 6. EXHIBITS
(a) Exhibits
31 Certification of the Chief Executive Officer and Chief
Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
32 Certification of the Chief Executive Officer and Chief
Financial Officer pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002
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 thereunto duly authorized.
HARDWOOD ACQUISITION CORPORATION
By: /s/ James M. Cassidy
President, Chief Financial Officer
Dated: May 15, 2012