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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(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, 2000
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 000-32101
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HARBORTOWN CORP.
(Exact name of registrant as specified in its charter)
Delaware 58-2502341
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 310, 1000 Abernathy Road NE, Atlanta, Georgia 30328
(Address of principal executive offices (zip code)
770/481-7205
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) filed all reports
required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the last 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 The Registrant has been subject to the
filing requirements of the Securities
Act of 1934 for less than 90 days.
Indicate the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date.
Class Outstanding at March 31, 2000
Common Stock, par value $0.0001 2,650,000
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2
HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
FORM 10-QSB
CONTENTS
Part I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
Cumulative Financial Statements:
Balance Sheets at March 31, 2001 and September 30, 2000.........F-1
Statements of operations and comprehensive income for
the six months ended March 31, 2001 and 2000....................F-2
Consolidated statements of operations and comprehensive
income for the three mohths ended March 31, 2001 and 2000.......F-3
Statements of operations and comprehensive income for
the six months ended March 31, 2001 and 2000....................F-4
Notes to Financial Statements for the six months ended
March 31, 2001 and 2000.........................................F-5/F-6
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION...............F-7/F-8
PART II - OTHER INFORMATION
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ITEM 1. LEGAL PROCEEDINGS......................................................F-8
ITEM 2. CHANGES IN SECURITIES..................................................F-8
ITEM 3. DEFAULTS UPON SENIOR SECURITIES........................................F-8
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS....................F-8
ITEM 5. OTHER INFORMATION......................................................F-8
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.......................................F-9
SIGNATURES.......................................................................F-9
3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
ASSETS
------
March 31, 2001
(unaudited) September 30, 2000
------------ -------------------
Current assets:
Cash $ 14 $ 70
------ ------
Total assets $ 14 $ 70
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LIABILITIES AND STOCKHOLDERS' DEFICIENCY
----------------------------------------
Current liabilities
Loan payable - stockholder $ 65 $ -
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Stockholders' deficiency:
Preferred stock, $0.0001 par value, 20 million
shares authorized, none issued and outstanding - -
Common stock, $.0001 par value, 100 million shares
authorized, 2,650,000 issued and outstanding 265 265
Additional paid in capital 265 265
Deficit accumulated during the development stage (581) (460)
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Total stockholders' deficiency (51) 70
------ ------
Total liabilities and stockholders' deficiency $ 14 $ 70
====== ======
See accompanying notes to consolidated financial statements (unaudited)
F-1
4
HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED MARCH 31, 2001 AND 2000
AND
CUMULATIVE FROM NOVEMBER 4, 1999 (DATE OF INCEPTION) TO MARCH 31, 2001
(UNAUDITED)
Cumulative
from
For the six For the six November 4, 1999
months ended months ended (date of inception)
March 31, 2001 March 31, 2000 to March 31, 2001
-------------- -------------- -----------------
Income: $ - $ - $ -
--------- --------- ---------
Expenses:
Selling, general, and
administrative expenses 121 460 581
--------- --------- ---------
Total expenses 121 460 581
--------- --------- ---------
Loss before provision for income
taxes (121) (460) (581)
Provision for income taxes - - -
--------- --------- ---------
Net loss (121) (460) (581)
Other items of comprehensive
income (loss) - - -
--------- --------- ---------
Comprehensive net loss $ (121) $ (460) $ (581)
========= ========= =========
Loss per share:
Basic and diluted $ NIL $ NIL $ NIL
========= ========== =========
Weighted average number of
common shares outstanding 2,650,000 2,650,000 2,650,000
========= ========= =========
See accompanying notes to consolidated financial statements (unaudited)
F-2
5
HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
(UNAUDITED)
2001 2000
--------- ---------
Income $ - $ -
--------- ---------
Expenses:
Selling, general, and
administrative expenses 33 460
--------- ---------
Total expenses 33 460
--------- ---------
Loss before provision for income
taxes (33) (460)
Provision for income taxes - -
--------- ---------
Net loss (33) (460)
Other items of comprehensive
income (loss) - -
--------- ---------
Comprehensive net loss $ (33) $ (460)
========= =========
Loss per share:
Basic and diluted $ NIL $ NIL
========= =========
Weighted average number of
common shares outstanding 2,650,000 2,650,000
========= =========
See accompanying notes to consolidated financial statements (unaudited)
F-3
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HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED MARCH 31, 2001 AND 2000
AND
CUMULATIVE FROM NOVEMBER 4, 1999 (DATE OF INCEPTION) TO MARCH 31, 2001
(UNAUDITED)
Cumulative
from
For the six For the six November 4, 1999
months ended months ended (date of inception)
March 31, 2001 March 31, 2000 to March 31, 2001
-------------- -------------- -----------------
Cash flows used in operating activities:
Net loss for the period $ (121) $ (460) $ (581)
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Net cash used in operating activities (121) (460) (581)
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Financing activities:
Advances from stockholders 65 - 65
Proceeds from initial capitalization - 530 530
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Net cash provided by (used in)
financing activities 65 530 595
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(Decrease) increase in cash during
the period (56) 70 14
Cash at beginning of period 70 - -
------ ------ ------
Cash at end of period $ 14 $ 70 $ 14
====== ====== ======
See accompanying notes to consolidated financial statements (unaudited)
F-4
7
HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENT
FOR THE SIX MONTHS ENDED MARCH 31, 2001 AND 2000
AND
CUMULATIVE FROM NOVEMBER 4, 1999 (DATE OF INCEPTION) TO MARCH 31, 2001
(UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Business Operations
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Harbortown Corp. (a development stage Company) (the "Company")
was incorporated in Delaware on November 4, 1999 to serve as a
vehicle to effect a merger, exchange of capital stock, asset
acquisition or other business combination with a domestic or foreign
private business. As of March 31, 2001 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 September 30.
The Company's ability to commence operations is contingent upon its
ability to identify a prospective target business and raise the
capital it will require through the issuance of equity securities,
debt securities, bank borrowings or a combination thereof.
The unaudited financial statements and notes are presented as
permitted by Form 10-QSB. Accordingly, certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
may have been omitted.
Use of Estimates
----------------
The preparation of 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.
NOTE 2 - INTERIM RESULTS AND BASIS OF PRESENTATION
The unaudited financial statements as of March 31, 2001 and for the
three and six month periods ended March 31, 2001 and 2000 have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-QSB and items 303 and 301(B) Regulation S-B.
F-5
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HARBORTOWN CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENT
FOR THE SIX MONTHS ENDED MARCH 31, 2001 AND 2000
AND
CUMULATIVE FROM NOVEMBER 4, 1999 (DATE OF INCEPTION) TO MARCH 31, 2001
(UNAUDITED)
NOTE 2 - INTERIM RESULTS AND BASIS OF PRESENTATION (cont'd)
In the opinion of management, the unaudited financial statements have
been prepared on the same basis as the annual financial statements and
reflect all adjustments, which include only normal recurring
adjustments, necessary to present fairly the financial position as of
March 31, 2001 and the results of our operations and cash flows for the
three and six month periods ended March 31, 2001 and 2000. The results
for the three and six month periods ended March 31, 2001 are not
necessarily indicative of the results to be expected for any subsequent
quarter or the entire fiscal year ending September 30, 2001. The
balance sheet at September 30, 2000 has been derived from the audited
financial statements at that date.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the
Securities and Exchange Commission's rules and regulations. It is
suggested that these unaudited financial statements be read in
conjunction with our audited financial statements and notes thereto for
the year ended September 30, 2000 as included in our report on Form
10-SB filed on December 1, 2000.
NOTE 3 - STOCKHOLDERS' EQUITY
Preferred Stock
---------------
The Company is authorized to issue 20,000,000 shares of preferred stock
at $.000l par value, with such designations, voting and other rights
and preferences as may be determined from time to time by the Board of
Directors.
Common Stock
------------
The Company is authorized to issue 100,000,000 shares of common stock
at $.000l par value.
NOTE 4 - RELATED PARTIES
Current legal counsel to the Company is a firm of which the sole
director and controlling shareholder of the Company is a partner.
F-6
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company has registered its common stock on a Form 10-SB registration
statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act") and Rule 12(g) thereof. The Company files with the Securities and
Exchange Commission periodic and episodic reports under Rule 13(a) of the
Exchange Act, including quarterly reports on Form 10-QSB and annual reports
Form 10-KSB. As a reporting company under the Exchange Act, the Company may
register additional securities on Form S-8 (provided that it is then in
compliance with the reporting requirements of the Exchange Act) and on Form
S-3 (provided that is has during the prior 12 month period timely filed all
reports required under the Exchange Act), and its class of common stock
registered under the Exchange Act may be traded in the United States securities
markets provided that the Company is then in compliance with applicable laws,
rules and regulations, including compliance with its reporting requirements
under the Exchange Act.
The Company was formed to engage in a merger with or acquisition of an
unidentified foreign or domestic private company which desires to become a
reporting ("public") company whose securities are qualified for trading in the
United States secondary market. The Company meets the definition of a "blank
check" company contained in Section (7)(b)(3) of the Securities Act of 1933, as
amended.
Management believes that there are perceived benefits to being a reporting
company with a class of publicly-traded securities which may be attractive to
foreign and domestic private companies.
These benefits are commonly thought to include (1) the ability to use
registered securities to make acquisition of assets or businesses; (2)
increased visibility in the financial community; (3)the facilitation of
borrowing from financial institutions; (4) improved trading efficiency;
(5) shareholder liquidity; (6) greater ease in subsequently raising capital;
(7) compensation of key employees through options for stock for which there is
a public market; (8) enhanced corporate image; and, (9) a presence in the
United States capital market.
A private company which may be interested in a business combination with
the Company may include (1) a company for which a primary purpose of becoming
public is the use of its securities for the acquisition of assets or businesses;
(2) a company which is unable to find an underwriter of its securities or is
unable to find an underwriter of securities on terms acceptable to it; (3) a
company which wishes to become public with less dilution of its common stock
than would occur normally upon an underwriting; (4) a company which believes
that it will be able obtain investment capital on more favorable terms after
it has become public; (5) a foreign company which may wish an initial entry
into the United States securities market; (6) a special situation company,
such as a company seeking a public market to satisfy redemption requirements
under a qualified Employee Stock Option Plan; and, (7) a company seeking one
or more of the other benefits believed to attach to a public company.
F-7
10
Management is actively engaged in seeking a qualified private company as
a candidate for a business combination. The Company is authorized to enter
into a definitive agreement with a wide variety of private businesses without
limitation as to their industry or revenues. It is not possible at this time
to predict with which private company, if any, the Company will enter into a
definitive agreement or what will be the industry, operating history, revenues,
future prospects or other characteristics of that company.
As of March 31, 2001, management had not made any final decision
concerning or entered into any agreements for a business combination. See
"SUBSEQUENT EVENTS". When any such agreement is reached or other material fact
occurs, the Company will file notice of such agreement or fact with the
Securities and Exchange Commission on Form 8-K. Persons reading this Form
10-QSB are advised to see if the Company has subsequently filed a Form 8-K.
The current shareholders of the Company have agreed not to sell or
otherwise transfer any of their common stock of the Company except in
connection with a business combination.
The Company does not intend to trade its securities in the secondary market
until completion of a business combination. It is anticipated that immediately
following such occurrence the Company will cause its common stock to be listed
or admitted to quotation on the NASD OTC Bulletin Board or, if it then meets
the financial and other requirements thereof, on the Nasdaq SmallCap Market,
National Market System or regional or national exchange.
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. CHANGES IN SECURITIES
Not applicable.
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
Not applicable.
F-8
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 4
-- Certificate of Incorporation filed as an exhibit to
the Company's registration statement on Form 10-SB (File
No. 000-32101) filed on December 8, 2000 which is
incorporated herein by reference.
-- By-Laws filed as an exhibit to the Company's
registration statement on Form 10-SB (File No. 000-32101)
filed on December 8, 2000 which is incorporated herein
by reference.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed by the Company during the
quarter ended March 31, 2000.
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.
Harbortown Corp.
By: /s/ Gilbert H. Davis
Gilbert H. Davis, President
Dated: May 11, 2001
F-9