<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
UNDER SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(Name of Small Business Issuer in its charter)
Florida 65-0704155
------- ----------
(State or other jurisdiction (I.R.S. Employer
incorporation or organization) Identification Number)
9001 N.W. 97TH TERRACE, UNIT E, MEDLEY, FLORIDA 33178
----------------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 888-7200
--------------
Securities to be registered under Section 12(b) of the Act:
None
Securities to be registered under Section 12(g) of the Act:
Common Stock, $.001 par value per share
(Title or class)
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TABLE OF CONTENTS
PAGE
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PART I
ITEM 1. DESCRIPTION OF BUSINESS.................................. 1
ITEM 2. PLAN OF OPERATION........................................ 4
ITEM 3. DESCRIPTION OF PROPERTY.................................. 7
ITEM 4. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT......................... 7
ITEM 5. MANAGEMENT............................................... 8
ITEM 6. EXECUTIVE COMPENSATION................................... 8
ITEM 7. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS..................................... 9
ITEM 8. DESCRIPTION OF SECURITIES................................ 9
PART II
ITEM 1. MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS...................................... 10
ITEM 2. LEGAL PROCEEDINGS........................................ 10
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE..................................... 10
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.................. 10
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS................ 10
PART F/S
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS........................ 11
<PAGE> 3
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
BUSINESS DEVELOPMENT
Ocean Fresh Seafood Marketplace, Inc. is a Florida corporation that was
incorporated on October 4, 1994, under the name Elm Tree Capital Corp. We
changed our name two times to Cybercloseout.com, Inc. and then Sitzen.com, Inc.
in early 1999. In October 1999 we changed our name to Ocean Fresh Seafood
Marketplace, Inc.
Other than organizational activities, we have not conducted any operational
activities since our incorporation.
We are filing this registration of our securities on a voluntary basis because
the primary attraction of us as a merger partner or acquisition vehicle will be
our status as a reporting public company. Any business combination or
transaction could result in a significant issuance of shares and substantial
dilution to our current stockholders.
We anticipate that the selection of a business opportunity in which to
participate will be complex and extremely risky. Due to general economic
conditions, rapid technological advances being made in some industries and
shortages of available capital, management believes that there are numerous
firms seeking the perceived benefits of a publicly-registered corporation. These
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, providing liquidity (subject
to restrictions of applicable statutes), for all stockholders and other factors.
Potentially, available business opportunities may occur 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
extremely difficult and complex.
We have nominal capital with which to provide the owners of business
opportunities with any significant cash or other assets. However, we believe
that we will be able to offer owners of acquisition candidates the opportunity
to acquire a controlling ownership interest in a publicly- registered company
without incurring the cost and time required to conduct an initial public
offering. The owners of the business opportunities will, however, incur
significant legal and accounting costs in connection with their acquisition of a
business opportunity, including the costs of preparing reports such as Form
8-K's, 10-K's or 10-KSB's, agreements and related reports and documents. The
Securities Exchange Act of 1934 specifically requires that any merger or
acquisition candidate comply with all applicable reporting requirements, which
include providing audited financial statements to be included within the
numerous filings relevant to complying with the Exchange Act. Nevertheless, our
officers and directors have not conducted market research and are not aware of
statistical data which would support the perceived benefits of a merger or
acquisition transaction for the owners of a business opportunity.
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INVESTMENT COMPANY ACT OF 1940
Although we will be subject to regulation under the Securities Act of 1933 and
the Securities Exchange Act of 1934, we believe that we will not be subject to
regulation under the Investment Company Act of 1940 insofar as we will not be
engaged in the business of investing or trading in securities. In the event that
we engage in business combinations which result in our holding passive
investment interests in a number of entities, we could be subject to regulation
under the Investment Company Act of 1940. In this event, we would be required to
register as an investment company and could be expected to incur significant
registration and compliance costs. We have obtained no formal determination from
the Securities and Exchange Commission as to our status under the Investment
Company Act of 1940 and, consequently, any violation of such Act would subject
us to material adverse consequences. We expect to be exempt from the Investment
Company Act of 1940 via Regulation 3a-2.
INVESTMENT ADVISER ACT OF 1940
We believe we are not an investment adviser under the Federal Investment Adviser
Act of 1940, which classification would involve a number of negative
considerations. Accordingly, we will not furnish or distribute advice, counsel,
publications, writings, analysis or reports to anyone relating to the purchase
or sale of any securities within the language, meaning and intent of Section
202(a)(11) of the Investment Adviser Act of 1940, 15 U.S.C.
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RISK FACTORS
WE HAVE NO OPERATIONS OR REVENUES AND HAVE LIMITED ASSETS. We have no revenues
or earnings from operations. We have little or no tangible assets or financial
resources. We will, in all likelihood, continue to sustain operating expenses
without corresponding revenues, at least until the consummation of a business
combination. This may result in our incurring a net operating loss which will
increase continually until we consummate a business combination with a
profitable business opportunity. There is no assurance that we can identify such
a business opportunity and consummate such a business combination.
TRANSFERABILITY OF OUR SHARES OF COMMON STOCK IS LIMITED BECAUSE A SIGNIFICANT
NUMBER OF STATES HAVE ENACTED SECURITIES OR BLUE SKY LAWS AND REGULATIONS
RESTRICTING OR, IN MANY INSTANCES, PROHIBITING, THE INITIAL SALE AND SUBSEQUENT
RESALE WITHIN THAT STATE OF SECURITIES OF BLANK CHECK COMPANIES SUCH AS US. In
addition, many states, while not specifically prohibiting or restricting blank
check companies, would not register our securities for sale or resale in their
states. Because of these regulations, we have no current plan to register any
securities with any state. To ensure that any state laws are not violated
through the resales of our securities, we will refuse to register the transfer
of any securities to residents of any state which prohibits this resale or if no
exemption is available for such resale. It is not anticipated that a secondary
trading market for our securities will develop in any state until consummation
of a business combination.
WE ARE AND WILL CONTINUE TO BE A MINOR PARTICIPANT IN THE BUSINESS OF SEEKING
MERGERS WITH, JOINT VENTURES WITH AND ACQUISITIONS OF SMALL PRIVATE AND PUBLIC
ENTITIES. A large number of established and well-financed entities, including
venture capital firms, are active in mergers and acquisitions of companies which
may be desirable target candidates for us. Nearly all of these entities have
significantly greater financial resources, technical expertise and managerial
capabilities than we, and, consequently, we will be at a competitive
disadvantage in identifying possible business opportunities and successfully
completing a business combination. In addition, we will also compete in seeking
merger or acquisition candidates with numerous other small public companies.
WE HAVE NO ARRANGEMENT, AGREEMENT OR UNDERSTANDING WITH RESPECT TO ENGAGING IN A
MERGER WITH, JOINT VENTURE WITH OR ACQUISITION OF, A PRIVATE OR PUBLIC ENTITY.
There can be no assurance that we will be successful in identifying and
evaluating suitable business opportunities or in concluding a business
combination. We cannot assure you that we have or will be able to negotiate a
business combination on favorable terms. We have not established a specific
length of operating history or a specified level of earnings, assets, net worth
or other criteria which we will require a target business opportunity to have
achieved, and without which we would not consider a business combination in any
form with such business opportunity. Accordingly, we may enter into a business
combination with a business opportunity having: no significant operating
history; losses; limited or no potential for earnings; limited assets; negative
net worth or other negative characteristics.
OUR PROPOSED OPERATIONS, EVEN IF SUCCESSFUL, WILL IN ALL LIKELIHOOD RESULT IN
OUR ENGAGING IN A BUSINESS COMBINATION WHICH WILL LIMIT OUR ACTIVITIES TO THOSE
ENGAGED IN BY THE ENTITY WITH
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WHICH WE MERGE OR ACQUIRE. Our inability to diversify our activities into a
number of areas may subject us to economic fluctuations within a particular
business or industry and therefore increase the risks associated with our
operations.
IN THE EVENT THAT WE ENGAGE IN BUSINESS COMBINATIONS WHICH RESULT IN OUR HOLDING
PASSIVE INVESTMENT INTERESTS IN A NUMBER OF ENTITIES, WE COULD BECOME SUBJECT TO
REGULATION UNDER THE INVESTMENT COMPANY ACT OF 1940. Although we will be subject
to regulation under the Securities Exchange Act of 1934, we believe that we will
not be subject to regulation under the Investment Company Act of 1940, insofar
as we will not be engaged in the business of investing or trading in securities.
In the event we are subject to the Investment Company Act, we would be required
to register as an investment company and could be expected to incur significant
registration and compliance costs. We have not obtained formal determination
from the Securities and Exchange Commission regarding our status under the
Investment Company Act of 1940 and, consequently, any violation of this act
could cause material adverse consequences to our business.
A BUSINESS COMBINATION INVOLVING THE ISSUANCE OF OUR COMMON STOCK WILL, IN ALL
LIKELIHOOD, RESULT IN STOCKHOLDERS OF A PRIVATE COMPANY OBTAINING A CONTROLLING
INTEREST IN US. Any similar business combination may require our management to
sell or transfer all or a portion of our common shares held by them, or resign
as members of our board of directors. The resulting change in control could
result in the removal of key management personnel and a corresponding reduction
in or elimination of his participation in our future affairs.
OUR PRIMARY PLAN OF OPERATION IS BASED UPON A BUSINESS COMBINATION WITH A
PRIVATE COMPANY WHICH WILL RESULT IN OUR ISSUING SECURITIES TO STOCKHOLDERS OF A
COMPANY WE ARE MERGING WITH OR ACQUIRING. The issuance of previously authorized
and unissued common stock would result in reduction in percentage of shares
owned by our present and prospective stockholders.
THE REQUIREMENT OF AUDITED FINANCIAL STATEMENTS MAY DISQUALIFY BUSINESS
OPPORTUNITIES. Sections 13 and 15(d) of the Securities Exchange Act of 1934
require companies to provide information about significant acquisitions,
including certified financial statements for the company acquired, covering one,
two or three years, depending on the relative size of the acquisition. The time
and additional costs that may be incurred by some target entities to prepare
such statements may preclude consummation of an otherwise desirable acquisition.
Acquisition prospects that do not have or are unable to obtain the required
audited financial statements may not be appropriate for acquisition so long as
the reporting requirements of the 1934 Act are applicable.
ITEM 2. PLAN OF OPERATION.
We currently have no operations or revenues. We are seeking to acquire assets or
shares of an entity actively engaged in business which generates revenues, in
exchange for our securities. We do not have any possible acquisition of merger
candidates as of the date of this filing.
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Our purpose is to seek, investigate and, if such investigation warrants, acquire
an interest in business opportunities presented to us by persons or firms who or
which desire to seek the perceived advantages of an Exchange Act registered
corporation. We will not restrict our search to any specific business, industry,
or geographical location and we may participate in a business venture of
virtually any kind or nature. This discussion of the proposed business is
purposefully general and is not meant to be restrictive of our virtually
unlimited discretion to search for and enter into potential business
opportunities. Our management anticipates that we may be able to participate in
only one potential business venture because we have nominal assets and limited
financial resources. This lack of diversification should be considered a
substantial risk to our stockholders because it will not permit us to offset
potential losses from one venture against gains from another.
The analysis of new business opportunities will be undertaken by, or under the
supervision of our executive officers, who may not be considered professional
business analysts. We intend to concentrate on identifying preliminary
prospective business opportunities which may be brought to our attention through
present associations of our officers and directors, or by our stockholders. In
analyzing prospective business opportunities, we will consider such matters as:
o the available technical, financial and managerial resources;
o working capital;
o other financial requirements;
o history of operations, if any;
o prospects for the future;
o nature of present and expected competition;
o the quality and experience of management services which may be
available and the depth of that management;
o the potential for further research, development, or
exploration;
o the potential for growth or expansion;
o the potential for profit;
o the perceived public recognition of acceptance of products,
services, or trades; and
o name identification
In implementing a structure for a particular business acquisition, we may become
a party to a merger, consolidation, reorganization, joint venture, or licensing
agreement with another corporation or entity. We may also acquire stock or
assets of an existing business. On the consummation of a transaction, it is
probable that our present management and stockholders will no longer control us.
In addition, our Board of Directors may, as part of the terms of the acquisition
transaction, resign and be replaced by new directors without a vote of our
stockholders. Any terms of sale of the shares presently held by any member of
management will be also afforded to all other stockholders on similar terms and
conditions. Any and all such sales will only be made in compliance with federal
and applicable state securities laws.
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We anticipate that any securities issued in any such reorganization would be
issued in reliance upon exemption from registration under applicable securities
laws. In some circumstances, however, as a negotiated element of its
transaction, we may agree to register all or a part of these securities
immediately after the transaction is consummated or at specified times
thereafter. If such registration occurs, of which there can be no assurance, it
will be undertaken by the surviving entity after we have successfully
consummated a merger or acquisition and we are no longer considered a shell
company. Until such time as this occurs, we will not attempt to register any
additional securities. The issuance of substantial additional securities and
their potential sale into any trading market which may develop in our securities
may have a depressive effect on the value of our securities in the future, if
such a market develops, of which there is no assurance.
While the actual terms of a transaction to which we may be a party cannot be
predicted, it may be expected that the parties to the business transaction will
find it desirable to avoid the creation of a taxable event and thereby structure
the acquisition in a so-called "tax-free" reorganization under Sections
368(a)(1) or 351 of the Internal Revenue Code. In order to obtain tax-free
treatment, it may be necessary for the owners of the acquired business to own
80% or more of the voting stock of the surviving entity. In such event, our
stockholders would retain less than 20% of the issued and outstanding shares of
the surviving entity, which would result in significant dilution in the equity
of such stockholders.
As part of our investigation, our management may meet with a target company's
management and key personnel, may visit and inspect material facilities, obtain
analysis of verification of certain information provided, check references of
management and key personnel, and take other reasonable investigative measures,
to the extent of our limited financial resources and management expertise. The
manner in which we participate in an opportunity will depend on:
o the nature of the opportunity,
o our respective needs and desires,
o respective needs and desires of other parties,
o our management of the opportunity, and
o relative negotiation strength.
We will not acquire or merge with any entity which cannot provide independently
audited financial statements within a reasonable period of time after closing of
the proposed transaction. We will be subject to all of the reporting
requirements included in the 1934 Act. Included in these requirements is the
affirmative duty to file independent audited financial statements as part of our
Form 8-K to be filed with the Securities and Exchange Commission upon
consummation of a merger or acquisition, as well as our audited financial
statements included in its annual report on Form 10-K (or 10-KSB, as
applicable). If such audited financial statements are not available at closing,
or within time parameters necessary to insure our compliance with the
requirements of the 1934 Act, or if the audited financial statements provided do
not conform to the representations made by the candidate to be acquired in the
closing documents, the closing documents will provide that the proposed
transaction will be voidable, at the discretion of our present management. If
this
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transaction is voided, the agreement will also contain a provision providing for
the acquisition entity to reimburse us for all costs associated with the
proposed transaction.
Except as required by law, we do not intend to provide our stockholders with any
complete disclosure documents, including audited financial statements,
concerning an acquisition or merger candidate and its business prior to the
consummation of any acquisition or merger transaction.
We anticipate that we will incur nominal expenses in the implementation of our
business plan.
EMPLOYEES
We have two part time employees that also serve as our management. They are not
compensated. We do not need to hire additional employees to facilitate our
business plan.
COMPETITION
We will remain an insignificant participant among the marketplace of firms that
engage in the acquisition of business opportunities. There are many established
venture capital and financial concerns which have significantly greater
financial and personnel resources and technical expertise than we. In view of
our limited financial resources and limited management availability, we will
continue to be at a significant competitive disadvantage to our competitors.
ITEM 3. DESCRIPTION OF PROPERTY.
We currently maintain our offices at 9001 N.W. 97th Terrace, Unit E, Medley,
Florida 33178. We occupy this office at no cost. This space is sufficient in
order to carry out our plan of operations.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth certain information as of June 30, 2000 regarding
beneficial ownership of our common stock by (1) each stockholder known by us to
be the beneficial owner of more than 5% of our common stock, (2) by each
director and executive officer and (3) by all executive officers and directors
as a group. Each of the persons named in the table has sole voting and
investment power with respect to common stock beneficially owned. The address
for each individual is 9001 N.W. 97th Terrace, Unit E, Medley, Florida 33178.
Number of Percentage of
Name shares owned shares owned
---- ------------ -------------
Robert G. Coutu 396,000 97.5%
Fred Guarino -0- -0-
All officers and directors
as a group (2 persons) 396,000 97.5%
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ITEM 5. MANAGEMENT.
OFFICERS AND DIRECTORS
The following table sets forth certain information concerning each of our
directors and executive officers:
Name Age Position
---- --- --------
Robert G. Coutu 49 President, Vice President and
Director
Fred Guarino 53 Secretary, Treasurer and Director
ROBERT COUTU has served as our president, vice president and a member of our
board of directors since May 1999. Since 1975, Mr. Coutu has served as president
and chief executive officer of Ocean Fresh Seafood, Inc. (unaffiliated to our
company), a wholesaler of seafood. Ocean Fresh Seafood currently has gross sales
of approximately $40,000,000 a year. Mr. Coutu's responsibilities with this
company include all financial and corporate activities. Mr. Coutu is also the
principal partner of Coutu Enterprises, a real estate firm. Mr. Coutu is a
graduate of Bryant College.
FRED GUARINO has served as our treasurer, secretary and member of our board of
directors since May 1999. Mr. Guarino has been a partner in the accounting firm
of Dacey, Guarino & Company, LP since 1985. He has served as secretary,
treasurer and director of Vanguard Services Corp. since February 1988. Vanguard
Services is a home health care company. Since September 1989 Mr. Guarino has
also been a partner of Parkway Properties, a real estate company. Mr. Guarino
was also recently appointed secretary, treasurer and director of Diversified
Packaging Co., a packaging company. Mr. Guarino's responsibilities for the
above-mentioned companies include financial and corporate duties. Mr. Guarino is
a member of the American Institute of Certified Public Accountants and Rhode
Island Society of CPAs. He is a graduate of Providence College and Suffolk
University.
ITEM 6. EXECUTIVE COMPENSATION.
None of our executive officers receive compensation from our company.
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ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In October 1999, Robert G. Coutu, our president and vice president, entered into
two stock purchase agreements with the then majority shareholders of our
company. Mr. Coutu acquired the majority interest in our company for
approximately $55,000, secured by two separate promissory notes for $5,000 and
$50,000. The note for $5,000 has subsequently been repaid.
ITEM 8. DESCRIPTION OF SECURITIES.
COMMON STOCK
Our articles of incorporation authorizes us to issue 750,000,000 shares of
common stock at $.001 par value. Each holder of common stock is entitled to one
vote for each share of common stock held. On August 31, 2000, there were 406,000
shares of common stock outstanding. Upon liquidation, each stockholder is
entitled to receive a proportionate share of his, her or its assets available
for distribution to stockholders after the payment of liabilities and after
distribution in full of preferential amounts, if any. All shares of common stock
issued and outstanding are fully-paid and nonassessable. Holders of the common
stock are entitled to share pro rata in dividends and distributions with respect
to the common stock, as may be declared by the board of directors out of funds
legally available therefor.
PREFERRED STOCK
Our articles of incorporation do not permit the issuance of preferred stock.
OPTIONS AND WARRANTS
We currently have no options or warrants outstanding to purchase shares of our
common stock.
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PART II
ITEM 1. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Our common stock is quoted on the pink sheets under the symbol OCEN. Over the
past two fiscal years, our common stock has not been traded, nor is there a bid
or ask price for the common stock.
As of October 30, 2000, there were in excess of 27 holders of our common stock.
We are authorized to issue 750,000,000 shares of common stock, $.001 par value,
of which 406,000 shares were issued and outstanding as of October 30, 2000.
DIVIDEND POLICY
We have not paid any cash dividends on our common stock and presently intend to
continue a policy of retaining earnings, if any, for reinvestment in our
business.
ITEM 2. LEGAL PROCEEDINGS.
None.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
There have been no disagreements with the findings of our accountants.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
None.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
We shall indemnify to the fullest extent permitted by, and in the manner
permissible under the laws of the State of Florida, any person made, or
threatened to be made, a party to an action or proceeding, whether criminal,
civil, administrative or investigative, by reason of the fact that he is or was
a director or officer of our company, or served any other enterprise as
director, officer or employee at the request of our company. The board of
directors, in its discretion, shall have the power on behalf of our company to
indemnify any person, other than a director or officer, made a party to any
action, suit or proceeding by reason of the fact that he/she is or was an
employee of our company. Indemnification of officers or persons controlling our
company for liabilities arising under the Securities Act of 1933 has been
determined by the Securities and Exchange Commission to be against public policy
and unenforceable.
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PART F/S
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS.
(1) The following financial statements of Ocean Fresh Seafood Marketplace, Inc.
are filed as part of this Report:
Audited balance sheet as of December 31, 1999 and related statements of
operations, stockholders' deficit and cash flows for the years then ended
December 31, 1999 and December 31, 1998. Unaudited balance sheet as of July 31,
2000 and related statements of operations, stockholders' deficit and cash flows
for the period.
(2) Exhibits:
2 Stock Purchase Agreement
3.0 Articles of Incorporation
3.1 Amended Articles of Incorporation
3.1(a) Amendment to Amended Articles of Incorporation
3.2 Bylaws
27.1 Financial Data Schedule
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SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
Ocean Fresh Seafood Marketplace, Inc.
Date: November 2, 2000 By: /s/ Robert G. Coutu
---------------------------------
Robert G. Coutu, President
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INDEX TO FINANCIAL STATEMENTS
OCEAN FRESH SEAFOOD MARKETPLACE, INC.
Independent Auditors' Report.............................................F-2
Balance Sheet............................................................F-3
Statements of Operations.................................................F-4
Statement of Stockholders' Deficit ......................................F-5
Statements of Cash Flows.................................................F-6
Notes to Financial Statements......................................F-7 - F-8
<PAGE> 16
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Ocean Fresh Seafood Marketplace, Inc.
Boca Raton, Florida
We have audited the accompanying balance sheet of Ocean Fresh Seafood
Marketplace, Inc. (a development stage enterprise), as of December 31, 1999, and
the related statements of operations, stockholders' deficit and cash flows for
the years ended December 31, 1999 and 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis, evidence supporting
the amount and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Ocean Fresh Seafood
Marketplace, Inc. (a development stage enterprise), as of December 31, 1999, and
the results of its operations and its cash flows for the years ended December
31,1999 and 1998, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that
Ocean Fresh Seafood Marketplace, Inc. will continue as a going concern. As
discussed in Note 2(a) to the financial statements, the Company currently has no
established sources of revenues. These conditions raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regard to these matters are also described in note 2(a). The financial
statements do not include adjustments that might result from the outcome of this
uncertainty.
/s/Feldman Sherb& Co., P.C.
Feldman Sherb & Co., P.C.
Certified Public Accountants
New York, New York
June 5, 2000
F-2
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OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
<TABLE>
<CAPTION>
July 31, December 31,
2000 1999
-------- ------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS DEFICIT
Current liabilities:
Due to shareholder $ 23,394 $ 13,732
-------- --------
Stockholders' deficit
Common stock, $.001 par value; 50,000,000 authorized,
406,000 issued and outstanding 406 406
Additional paid-in capital 4,619 4,619
Accumulated deficit (28,419) (18,757)
-------- --------
Total stockholder's deficit (23,394) (13,732)
-------- --------
$ -- $ --
======== ========
</TABLE>
See notes to financial statements
F-3
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OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Seven Months Ended July 31, Year Ended December 31, October 4, 1996
------------------------- ------------------------- (inception) through
2000 1999 1999 1998 July 31, 2000
--------- --------- --------- --------- -------------
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
OPERATING EXPENSES $ 9,662 $ 6,100 $ 13,732 $ -- $ 28,419
--------- --------- --------- --------- ---------
NET LOSS $ (9,662) $ (6,100) $ (13,732) $ -- $ (28,419)
========= ========= ========= ========= =========
NET LOSS PER WEIGHTED AVERAGE
SHARES OUTSTANDING $ (0.02) $ (0.01) $ (0.03) $ -- $ (0.06)
========= ========= ========= ========= =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 406,000 502,500 478,375 502,500 $ 481,522
========= ========= ========= ========= =========
</TABLE>
See notes to financial statements
F-4
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OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS' DEFICIT
<TABLE>
<CAPTION>
Common stock Additional Total
----------------------------- Paid-In Accumulated Stockholders'
Shares Amount Capital Deficit Deficit
---------- ---------- ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1997 5,025,000 5,025 -- (5,025) --
Net loss -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Balance, December 31, 1998 5,025,000 5,025 -- (5,025) --
Cancelled shares (965,000) (965) 965 -- --
One for ten stock split (3,654,000) (3,654) 3,654 -- --
Net loss -- -- -- (13,732) (13,732)
---------- ---------- ---------- ---------- ----------
Balance, December 31, 1999 406,000 406 4,619 (18,757) (13,732)
Net loss (unaudited) -- -- -- (9,662) (9,662)
---------- ---------- ---------- ---------- ----------
Balance, July 31, 2000 (unaudited) 406,000 406 4,619 (28,419) (23,394)
========== ========== ========== ========== ==========
</TABLE>
See notes to financial statements
F-5
<PAGE> 20
OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
July 31, December 31, October 4, 1996
------------------------- ------------------------ (inception) through
2000 1999 1999 1998 July 31, 2000
-------- -------- -------- -------- -------------
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net loss $ (9,662) $ (6,100) $(13,732) $ -- $(28,419)
Adjustments to reconcile net
loss to net cash flows
provided by (used in)
operating activities:
Common stock issued for
services -- -- -- -- 5,025
-------- -------- -------- -------- --------
NET CASH USED IN OPERATING ACTIVITIES (9,662) (6,100) (13,732) -- (23,394)
-------- -------- -------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from due to shareholder 9,662 6,100 13,732 -- 23,394
-------- -------- -------- -------- --------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 9,662 6,100 13,732 -- 23,394
-------- -------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH -- -- -- -- --
CASH, beginning of period -- -- -- -- --
-------- -------- -------- -------- --------
CASH, end of year $ -- $ -- $ -- $ -- $ --
======== ======== ======== ======== ========
</TABLE>
See notes to financial statements
F-6
<PAGE> 21
OCEAN FRESH SEAFOOD MARKETPLACE, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31,1999 AND 1998
AND FOR THE SEVEN MONTHS ENDED JULY 31, 2000 AND 1999 (UNAUDITED)
1. THE COMPANY
Ocean Fresh Seafood Marketplace, Inc. (the "Company") was incorporated
in the State of Florida on October 4, 1996. The Company was originally
incorporated as Elm Tree Capital Corp., and has undergone various name changes
since inception. On October 27, 1999, the Company underwent its latest name
change to Ocean Fresh Seafood Marketplace, Inc. The Company currently has no
operations and is considered a development stage enterprise.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. BASIS OF PRESENTATION - The Company has no established sources
of revenues and as such this raises substantial doubt about
the Company's ability to continue as a going concern. The
continued existence is dependent upon the Company's ability to
generate revenue from operations or to seek additional sources
of financing.
There are no assurances that the Company can develop sources
or revenues or obtain additional financing that may be
required. The accompanying financial statements do not include
any adjustments that might result from the outcome of these
uncertainties.
b. 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.
c. INCOME TAXES - The Company recognizes deferred tax assets and
liabilities based on the difference between the financial
statements carrying amount and the tax basis of assets and
liabilities, using the effective tax rates in the years in
which the difference are expected to reverse. A valuation
allowance related to deferred tax assets is also recorded when
it is probable that some or all of the deferred tax asset will
not be realized. As of December 31, 1999, no deferred tax
assets have been recorded as the realization of such asset
would not be probable.
F-7
<PAGE> 22
3. DUE TO SHAREHOLDER
As of December 31, 1999 and June 30, 2000 the Company owes $13,732 and
$23,394, respectively to the majority shareholder of the Company. Such
advances are noninterest bearing and are due upon demand. These
advances were utilized to fund the organization costs of the Company.
4. STOCKHOLDERS' EQUITY
During October 1999 the Company cancelled 965,000 shares of its common
stock previously issued. The shares were cancelled as no consideration
was received for its issuance.
On October 6, 1999, with the joint approval of the Board of Directors
and the shareholders of the Company a one-for-ten reverse stock split
was effected. All references to earnings (loss) per share in these
financial statements have been retroactively restated to reflect the
one-for-ten reverse stock split.
F-8
