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
HARVEST CAPITAL CORPORATION
(Name of small business issuer as specified in its charter)
Delaware 13-3334512
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
225 West 37th Street, New York, NY 10018
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, (212) 819-1066
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.0001 per share
(Title of class)
(Title of class)
Item 1. Description of Business.
(a) Business Development. Harvest Capital Corporation
("Harvest" or the "Company") was organized under the laws of the
state of Delaware on August 29, 1985. In February 1986, Harvest
completed a public offering of 50,000,000 shares of its Common
Stock, par value $.0001 per share (the "Common Stock"). In October
1988, Harvest formed a wholly-owned subsidiary, Exclusives for the
Bride, Inc. ("Exclusives"). During its fiscal year ended April 30,
1991 ("Fiscal 1991"), the Company sold substantially all of the
assets of Exclusives and since then it has had no substantial
revenues.
Since October 31, 1990, the Company's assets have consisted
primarily of Common Stock of JLM Couture, Inc. ("JLM"), a company
registered under the Securities Exchange Act of 1934 which is
engaged in the business of marketing bridal gowns and bridesmaids'
gowns. JLM is controlled by a significant shareholder, officer and
director of the Company. The Company also has a limited amount of
cash. (See "Management's Discussion and Analysis of Financial
Condition and Results of Operations", "Certain Transactions" and
the Consolidated Financial Statements elsewhere herein).
(b) Business of Issuer. The Company is actively seeking
acquisition or merger candidates with operating businesses and is
seeking to complete an acquisition or merger with one of these
candidates.
Item 2. Management's Discussion and Analysis or Plan of Operation.
(a) Plan of Operation. The Company's plan of operation for
the next twelve months is to seek acquisition or merger candidates
with operating businesses and complete an acquisition or merger
with one of these candidates. Until such event, the Company does
not expect a significant change in its number of employees and does
not expect to purchase or sell any significant equipment.
Year 2000 Compliance
The Company is on schedule with a project that addresses the
Year 2000 (Y2K) issue of computer systems and other equipment with
embedded chips or processors not being able to properly recognize
and process date-sensitive information after December 31, 1999.
The Company has completed all programming changes required to make
its computer system Y2K complaint. The Company's computer systems
are able to recognize date sensitive information with dates after
December 31, 1999. The total cost incurred to convert the system
has been minimal. Many systems use only the last two digits rather
than four to define the year and these systems will not be able to
distinguish between the year 1900 and the year 2000. This may lead
to disruption in the operations of business and governmental
entities resulting from miscalculations or system failures. This
project is designed to ensure the compliance of all of the
Company's applications, operating systems and hardware platforms,
and to address the compliance of key business partners. Key
business partners are those customers and vendors that have a
material impact on the Company's operations. The total estimated
cost of the required modifications to become Y2K compliant should
not be material to the Company's financial position.
Failure to make all internal business systems Y2K compliant
could result in an interruption in, or failure of, some of the
Company's business activities or operations. Y2K disruption in the
operations of key vendors could impact the Company's ability to
obtain components necessary for the manufacture of products and
fulfillment of contractual obligations. If one or more of these
situations occur, the Company's results of operations, liquidity
and financial conditions could be materially and adversely
affected. The Company is unable to determine the readiness of its
key business partners at this time and is therefore unable to
determine whether the consequences of Y2K failures will have a
material impact on the Company's result of operations, liquidity or
financial condition. The Y2K project is expected to reduce the
Company's level of uncertainty about the Y2K problem and reduce the
possibility of significant interruptions of normal business
operations.
Safe Harbor Statement
Statements which are not historical facts, including
statements about the Company's confidence and strategies and its
expectations about new and existing products, technologies and
opportunities, market and industry segment growth, demand and
acceptance of new and existing products are forward looking
statements that involve risks and uncertainties. These include,
but are not limited to, product demand and market acceptance risks;
the impact of competitive products and pricing; the results of
financing efforts; the loss of any significant customers of any
business; the effect of the Company's accounting policies; the
effects of economic conditions and trade, legal, social, and
economic risks, such as import, licensing, and trade restrictions;
the results of the Company's business plan and the impact on the
Company of its relationship with its lender.
Item 3. Description of Property.
The Company's executive offices are located at 225 West 37th
Street, 5th Floor, New York, New York 10018, which are made
available to the Company by Mr. Joseph L. Murphy, President of the
Company, for no fee other than the administrative fee referred to
below in Item 7. "Certain Relationships and Related Transactions."
<PAGE>
Item 4. Security Ownership of Certain Beneficial Owners and
Management.
The following table sets forth as of September 23, 1999 the
number of shares of the Common Stock held by each person who held
of record or was known by the Company to beneficially own more than
5% of the outstanding shares of Common Stock, the name and
shareholdings of each director and all officers and directors as a
group.
Name and Address of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership(1) Class
Joseph L. Murphy 20,400,000 22.9%
225 West 37th Street
New York, NY 10018
Eve Traube and 8,500,000(2) 11.5%
Sheldon Traube
624 Avenue O
Brooklyn, NY 11230
Daniel M. Sullivan 1,500,000 3.8%
Julie Nagel 5,000,000 5.6%
4309 Sawyer
Chicago, IL 60618
All Officers and Directors 30,400,000 33.8%
as a Group
(3 persons)
(1) Except as otherwise set forth below, all shares of Common
Stock are owned directly, and such shareholders have sole
voting, investment and dispositive power.
(2) Sheldon Traube is deemed to share voting, investment and
dispositive power with his wife, Eve Traube, an officer
and director of the Company.
<PAGE>
Item 5. Directors and Executive Officers of Registrant.
Set forth below are the names and ages of each executive
officer and director of the Company, their respective positions,
and periods of service:
Name Age Position
Joseph L. Murphy 44 President and
Director
Eve Traube 43 Executive Vice
President and
Director
Daniel M. Sullivan 74 Secretary, Treasurer
and Director
The term of office of each executive officer and director is
one year and until his or her respective successor is elected and
qualified.
Joseph L. Murphy. Mr. Murphy has been an officer and director
of the Company since its inception in August 1985. Mr. Murphy also
serves as President and Director of JLM, a company with which he
has been affiliated with since 1986.
Eve Traube. Ms. Traube has been an officer and director of
the Company since its inception in August 1985. From November 1985
until present, Ms. Traube has been a director of financial aid and
bursar for Blake Business Institute in New York City, a proprietary
vocational school with an approximate student body of 750 students.
Daniel M. Sullivan. Mr. Sullivan has been an officer and
director of the Company since its inception in August 1985. Until
1989, Mr. Sullivan was President of Frost & Sullivan Inc., a
publisher of marketing research studies. Mr. Sullivan is also a
director of JLM.
Item 6. Executive Compensation.
During the fiscal year ended April 30, 1999 ("Fiscal 1999"),
no officer received cash compensation from the Company and no
executive officer received any personal benefits. See Item 7.
"Certain Relationships and Related Transactions."
Item 7. Certain Relationships and Related Transactions.
Mr. Murphy, the Company's President, does not receive a salary
from the Company. He receives an administrative fee of $6,000 per
year for providing management and consulting services and providing
office space to the Company. These fees have been accrued and not
paid. As of April 30, 1999, Mr. Murphy is owed an aggregate of
$54,500 of such fees.
Item 8. Legal Proceedings.
None.
Item 9. Market For Registrant's Common Equity and Related
Stockholder Matters.
The Common Stock is traded in the over-the-counter market and
has been quoted on the "Electronic Bulletin Board" since December
20, 1993. Prior thereto, the Common Stock had been quoted on the
Pink Sheets maintained by National Quotation Systems, Inc. There
is a very limited public market for the Common Stock. As of
September 23, 1999, 88,999,999 shares of common stock were
outstanding.
The following table sets forth, for the respective periods
indicated, the high and low bid quotations for Common Stock from
the Electronic Bulletin Board. The market quotations represent
prices between dealers, do not include retail markup, markdown, or
commissions and may not represent actual transactions.
Quarter Ended High Bid Low Bid
1997
January 31, 1997 0 0
April 30, 1997 0 0
July 31, 1997 0 0
October 31, 1997 0 0
1998
January 31, 1998 0 0
April 30, 1998 0 0
July 31, 1998 0 0
October 31, 1998 0 0
1999
January 31, 1999 0 0
April 30, 1999 0 0
July 31, 1999 .01 .01
No dividends have been paid on the Common Stock and the
Company does not anticipate paying dividends in the foreseeable
future.
As of September 23, 1999, the Company had no outstanding
options. All of the 50,000,000 shares of Common Stock outstanding
have been registered under the Securities Act of 1933 (the "Act").
The remaining 38,999,999 outstanding shares are presently eligible
for sale under Rule 144 promulgated under the Act.
At September 23, 1999, there were approximately 316 holders of
record of the Company's securities. The Company believes that it
has more shareholders since many of its shares are held in "street"
name.
Item 10. Recent Sales of Unregistered Securities.
None.
Item 11. Description of Securities.
The following statements are brief summaries of certain
provisions of the Company's Certificate of Incorporation and By-
Laws. The summaries are qualified in their entirety by reference
to these documents which are filed as exhibits to the Registration
Statement.
Common Stock
The authorized capital of the Company consists of 300,000,000
shares of Common Stock, par value $.0001 per share, of which
88,999,999 shares were outstanding as of the date of this
Prospectus.
Holders of shares of Common Stock are entitled to share, on a
ratable basis, such dividends as may be declared by the Board of
Directors out of funds legally available therefor. Upon
liquidation, dissolution or winding up of the Company, after
payment to creditors, if any, the assets of the Company will be
divided pro rata on a per share basis among the holders of the
Common Stock.
Each share of Common Stock entitles the holders thereof to one
vote. Holders of Common Stock do not have cumulative voting rights
which means that the holders of more than 50% of the shares voting
for the election of Directors can elect all of the Directors if
they choose to do so, and, in such event, the holders of the
remaining shares will not be able to elect any directors. As of
September 23, 1999, the Company's management will own 30,400,000
shares or approximately 33.8% of the outstanding Common Stock of
the Company. See Item 4, "Security Ownership of Certain Beneficial
Owners and Management." The By-Laws of the Company require that
only a majority of the issued and outstanding shares of Common
Stock need be represented to constitute a quorum and to transact
business at a shareholders' meeting. The Common Stock has no
preemptive, subscription or conversion rights and is not redeemable
by the Company.
Item 12. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law empowers
a corporation to indemnify its directors and officers and to
purchase insurance with respect to liability arising out of their
capacity or status as directors and officers provided that this
provision shall not eliminate or limit the liability of a director
(i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing
violation of law, (iii) arising under Section 174 of the General
corporation law of Delaware, or (iv) for any transaction from which
the director derived an improper personal benefit.
The Delaware Corporation Law provides further that the
indemnification permitted thereunder shall not be deemed exclusive
of any other rights to which the directors and officers may be
entitled under the corporation's by-laws, any agreement, vote of
shareholders or otherwise.
The Company's Certificate of Incorporation eliminates the
personal liability of directors to the fullest extent permitted by
Section 102(b) (7) of the Delaware Corporation Law.
The effect of the foregoing is to require the Company to
indemnify the officers and directors of the Company for any claim
arising against such persons in their official capacities if such
person acted in good faith and in a manner that he reasonably
believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful.
INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE
SECURITIES ACT OF 1933 MAY BE PERMITTED TO DIRECTORS, OFFICERS OR
PERSONS CONTROLLING THE COMPANY PURSUANT TO THE FOREGOING
PROVISIONS, THE COMPANY HAS BEEN INFORMED THAT IN THE OPINION OF
THE SECURITIES AND EXCHANGE COMMISSION, SUCH INDEMNIFICATION IS
AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT AND IS THEREFORE
UNENFORCEABLE.
Item 13. Financial Statements.
The financial statements and supplementary data are included
on pages F-1 through F-12 and Page S-1.
Item 14. Changes In and Disagreements With Accountants on
Accounting and Financial Disclosure.
None.
Item 15. Financial Statements and Exhibit.
(a)(1) Financial Statements
The following Financial Statements are filed as part of this
report.
Title of Document Page
Audited
Report of Independent Certified F-1
Public Accountants
Balance Sheets as of April 30, 1999 and 1998 F-2
Statements of Operations and Comprehensive Income F-3
for the years ended April 30, 1999 and 1998 and
Cumulative from November 1, 1990 to April 30, 1999
Statements of Stockholders' Equity for the F-4 - F-5
years ended April 30, 1991 through April 30, 1999
Statements of Cash Flows for the years F-6
ended April 30, 1999 and 1998 and Cumulative
from November 1, 1990 to April 30, 1999
Notes to Financial Statements F-7 - F-8
Unaudited
Balance Sheets as of July 31, 1999 F-9
and April 30, 1999
Statements of Operations and Comprehensive F-10
Income for the Three Months Ended July 31,
1999 and 1998
Statements of Cash Flows for the Three F-11
Months Ended July 31, 1999 and 1998
Notes to Unaudited Financial Statements F-12
<PAGE>
(a)(2) Financial Statement Schedules
Schedule I. Marketable Securities - Other Investments S-1
(b) Exhibits
Exhibit
No. Title of Document Location
1. Articles of Incorporation* Exhibit No. 4 to Form S-18
Registration Statement No.
33-2034-NY, of Harvest
Capital Corp. (the "Form S-
18")
2. By-Laws* Exhibit No. 6 to the
Form S-18
* These items are incorporated by reference.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
HARVEST CAPITAL CORPORATION
Date: September 28, 1999 s/Joseph L. Murphy
Joseph L. Murphy, President and
Director (Principal Executive,
Accounting, and Financial
Officer)
Date: September 28, 1999 s/Daniel M. Sullivan
Daniel M. Sullivan,
Secretary/Treasurer and Director
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Shareholders
Harvest Capital Corporation
I have audited the accompanying balance sheets of Harvest Capital
Corporation, a corporation in the development stage since December
1, 1990, as of April 30, 1999 and 1998, and the related statements
of operations, changes in stockholders' equity and cash flows for
the years then ended and for the period from inception of the
development stage (December 1, 1990) to April 30, 1999. These
financial statements are the responsibility of the Company's
management. My responsibility is to express an opinion on these
financial statements based on our audits.
I conducted my audits in accordance with generally accepted
auditing standards. Those standards require that I plan and
perform the audit 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
amounts 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. I believe that my audits provide
a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Harvest
Capital Corporation as of April 30, 1999 and 1998, and the results
of its operations and its cash flows for the years then ended, and
from the period of its development stage inception (December 1,
1990) to April 30, 1999, in conformity with generally accepted
accounting principles.
PAUL C. ROBERTS
Certified Public Accountant
Pleasantville, New York
September 20, 1999
<PAGE>
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
BALANCE SHEETS
April 30, 1999 and 1998
ASSETS
1999 1998
Current assets:
Cash $ 359 $ 471
Total current assets 359 471
Other assets:
Securities available for sale 157,480 285,432
Total assets $157,839 $285,903
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accrued expenses and taxes payable $ 691 $ 691
Due to related party 54,500 46,700
Total current liabilities 55,191 47,391
Stockholder's equity:
Preferred stock - $.0001 par value
authorized 5,000,000 shares; issued
and outstanding - none
Common stock - $.0001 par value,
authorized 300,000,000 shares:
issued and outstanding 88,999,999
at April 30, 1999 and 1998 8,900 8,900
Additional paid-in capital 442,980 442,980
Retained (deficit) - prior to
development stage inception (314,120) (314,120)
Retained (deficit) - development
stage (122,481) (114,569)
Unrealized gain on securities
available-for-sale, net of taxes 87,369 215,321
Total stockholders' equity 102,648 238,512
$157,839 $285,903
See accompanying notes to financial statements.
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME
April 30, 1999 AND 1998
Cumulative
from
November 1,
1990 to
April 30,
1999 1998 1999
Revenues:
Interest $ 8 $ 11 $ 2,883
Costs and expenses:
General and adminis-
trative $ 1,920 $ 1,910 60,117
Management fees -
related party 6,000 6,000 57,000
7,920 7,910 117,117
(Loss) from operations (7,912) (7,899) (114,284)
(Loss) on Sale of Stock - - (6,460)
Provision for income
taxes - - (1,737)
Net (loss) $ (7,912) $ (7,899) $ (122,481)
Other Comprehensive income
Unrealized gain (loss)
on securities (127,952) (88,583) 87,369
Total Comprehensive Income
(loss) $ (135,864) $ (96,482) $ (35,112)
Net (loss) per
common share $ - $ -
Weighted average
common shares
outstanding 88,999,999 88,999,999
See accompanying notes to financial statements.
<PAGE>
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
<TABLE> STATEMENTS OF STOCKHOLDERS' EQUITY
<CAPTION>
Accumulated Accumulated Unrealized
Deficit Deficit Gains on
Additional Prior to During Securities
Common Stock Paid In Development Development Available
Shares Par Value Capital Stage Stage for Sale Total
<S>
Balance, <C> <C> <C> <C> <C> <C> <C> <C> <C>
April 30,
1990 88,999,999 $8,900 $442,980 $ (306,891) $ - $ - $135,723
Net (loss)
5/1/90 to
10/31/90 - - - (7,229) - - (7,229)
Net (loss)
11/1/90 to
4/30/91 - - - - (2,037) - (2,037)
Balance,
April 30,
1991 88,999,999 8,900 442,980 (314,120) (2,037) - 135,723
Net (loss) - - - - (38,055) - (38,055)
Balance,
April 30,
1992 88,999,999 8,900 442,980 (314,120) (40,092) - 97,668
Net (loss) - - - - (28,700) - (28,700)
Balance,
April 30,
1993 88,999,999 8,900 442,980 (314,120) (68,792) - 68,968
Net (loss) - - - - (11,046) - (11,046)
Balance,
April 30,
1994 88,999,999 8,900 442,980 (314,120) (79,838) - 57,922
Net (loss) - - - - (7,800) - (7,800)
Unrealized Gain
-Securities - - - - - 1,629 1,629
Balance,
April 30,
1995 88,999,999 8,900 442,980 (314,120) (87,638) 1,629 51,751
</TABLE>
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
<TABLE> STATEMENTS OF STOCKHOLDERS' EQUITY (CONT'D)
<CAPTION>
Accumulated Accumulated Unrealized
Deficit Deficit Gains on
Additional Prior to During Securities
Common Stock Paid In Development Development Available
Shares Par Value Capital Stage Stage for Sale Total
<S> <C> <C> <C> <C> <C> <C> <C>
Net (loss) - - - - (11,137) - (11,137)
Unrealized Gain
-Securities - - - - - 130,031 130,031
Balance,
April 30,
1996 88,999,999 8,900 442,980 (314,120) (98,775) 131,660 170,645
Net (loss) - - - - (7,895) - (7,895)
Unrealized Gain
-Securities - - - - - 172,244 172,244
Balance,
April 30,
1997 88,999,999 8,900 442,980 (314,120) (106,670) 303,904 334,994
Net (loss) - - - - (7,899) - (7,899)
Unrealized (loss)
-Securities - - - - - (88,583) (88,583)
Balance,
April 30,
1998 88,999,999 8,900 442,980 (314,120) (114,569) 215,321 238,512
Net (loss) - - - - (7,912) - (7,912)
Unrealized (loss)
-Securities - - - - - (127,952) (127,952)
Balance,
April 30,
1999 88,999,999 $8,900 $442,980 $(314,120) $ (122,481) $ 87,369 $102,648
</TABLE>
See accompanying notes to financial statements.
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
STATEMENTS OF CASH FLOWS
YEARS ENDED APRIL 30, 1999 AND 1998
Cumulative
from
November 1,
1990 to
April 30,
1999 1998 1996
Cash flows from operating
activities:
Net (loss) $ (7,912) $ (7,899) $(122,481)
Adjustments to reconcile net
(loss) to net cash (used)
by operating activities:
Unrealized gain (loss) on
securities available for sale (127,952) (88,583) 87,369
Loss on sale of securities - - 6,460
Changes in assets and
liabilities:
(Increase) decrease in
marketable securities 127,952 88,583 (89,487)
Decrease in organization
expense - - 30
Increase (decrease) in
accounts payable, accrued
expenses and taxes - - (13,536)
Increase in amounts due to
related party 7,800 7,800 54,500
Net cash (used) by operating
activities (112) (99) (77,145)
Cash flows from investing
activities:
Proceeds from sale of
securities - - 14,540
Net cash provided by
investing activities - - 14,540
Net increase (decrease)
in cash and cash equivalents (112) (99) (62,605)
Cash and cash equivalents,
beginning of year 471 570 62,964
Cash and cash equivalents,
end of year $ 359 $ 471 $ 359
Supplemental disclosures of
cash flow information:
Cash received from interest income $ 8 $ 11
See accompanying notes to financial statements.
HARVEST CAPITAL CORPORATION AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1999 AND 1998
1. ORGANIZATION AND OPERATIONS OF COMPANY
Harvest Capital Corporation (the "Company") was organized
under the laws of the state of Delaware on August 29, 1985.
Through October 1990 the Company was engaged in the retail
sale of bridal clothes and since then has been engaged in the
activity of searching for and investigating business
opportunities and is therefore considered to be in the
development stage since October of 1990.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Income (Loss) Per Share
Per share computations are based on the weighted average
number of shares outstanding during the period.
Use of Estimates
The preparation of the financial statements in conformity with
generally 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
revenues and expenses during the reporting period. Actual
results could differ from those estimates.
3. MARKETABLE EQUITY SECURITIES
All of the Company's securities are classified as available-
for-sale securities and are recorded at fair value with
unrealized gains and losses included in comprehensive income
and reported, net of taxes, in a separate component of
stockholders' equity. The basis of cost used in determining
realized gains and losses are the first-in, first-out method.
Investments in securities at April 30, 1999 were as follows:
Gross Gross Un-
Amortized Unrealized realized Fair
Cost Gains Losses Value
Available-for-sale securities $70,111 - 127,952 157,480
Investments in securities at
April 30, 1999 were as follows:
Available-for-sale securities $70,111 - 88,583 285,432
HARVEST CAPITAL CORPORATION AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1999 AND 1998
New Accounting Standards
In 1998, the Company adopted Statement of Accounting Standards
("FAS") No. 130, "Reporting Comprehensive Income." FAS No.130
requires that the components and total amounts of
comprehensive income be displayed in the Financial Statements
beginning in 1998. Comprehensive income includes net income
and all changes in equity during a period that arise from non-
owner sources, such as foreign currency items and unrealized
gains and losses on certain investments in equity securities.
4. INCOME TAXES
The Company uses the liability method required by Statement of
Financial Accounting Standards No. 109, "Accounting for Income
Taxes", whereby deferred income taxes are recorded based upon
the difference between financial statement and tax bases of
assets and liabilities. The Company has net operating loss
carryforwards of approximately $436,000 that can be used
through the years ending April 30, 2004 to April 30, 2014.
The Company has recognized a full valuation allowance for the
net operating loss carryforwards and therefore no deferred tax
asset has been recognized.
5. STOCK OPTIONS
In October 1995, the FASB issued Statement of Financial
Accounting Standards No. 123 "Accounting and Disclosure of
Stock Based Compensation" (Statement 123). Statement 123 is
effective for fiscal years beginning after December 15, 1995,
and allows for the option of continuing to follow Accounting
Principles Board Opinion No. 25 (APB 25), "Accounting for
Stock Issued to Employees" and the related interpretations or
selecting the fair value method of expense recognized as
described in Statement 123. The Company has elected to follow
APB 25 in accounting for its employee stock options. Under
APB 25, because the exercise price of the Company's employee
stock options are equal to or less than the market price or
the underlying stock on the date of grant, no compensation
expense is recognized.
6. RELATED PARTY TRANSACTIONS
The Company has paid or accrued management fees to a firm of
which a principal, Joseph Murphy, is also an officer, director
and major shareholder of the Company. These fees included
$6,000 for each of the years ended April 30, 1999 and 1998,
respectively.
<PAGE>
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
BALANCE SHEETS
(Unaudited)
ASSETS
July 31, April 30,
1999 1999
Current assets:
Cash $ 331 $ 359
Total current assets 331 359
Other assets:
Securities available for sale 157,480 157,480
Total assets $ 157,811 $ 157,839
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accrued expenses and taxes payable $ 691 $ 691
Due to related party 56,450 54,500
Total current liabilities 57,141 55,191
Stockholder's equity:
Preferred stock - $.0001 par value
authorized 5,000,000 shares; issued
and outstanding - none
Common stock - $.0001 par value,
authorized 300,000,000 shares:
issued and outstanding 88,999,999
at April 30, 1999 and 1998 8,900 8,900
Additional paid-in capital 442,980 442,980
Retained (deficit) - prior to
development stage inception (314,120) (314,120)
Retained (deficit) - development
stage (124,459) (122,481)
Unrealized gain on securities
available-for-sale, net of taxes 87,369 87,369
Total stockholders' equity 100,670 102,648
$ 157,811 $ 157,839
See accompanying notes to unaudited financial statements.
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
July 31,
1999 1998
Revenues:
Interest $ 2 $ 3
Costs and expenses:
General and adminis-
trative $ 480 $ 470
Management fees -
related party 1,500 1,500
1,980 1,970
(Loss) from operations (1,978) (1,967)
Provision for income
taxes - -
Net (loss) $ (1,978) $ (1,967)
Other Comprehensive income
Unrealized gain (loss)
on securities - (30,758)
Total Comprehensive Income
(loss) $ (1,978) $ (32,725)
Net (loss) per
common share $ - $ -
Weighted average
common shares
outstanding 88,999,999 88,999,999
See accompanying notes to unaudited financial statements.
HARVEST CAPITAL CORPORATION
(A Development Stage Corporation)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
July 31,
1999 1998
Cash flows from operating
activities:
Net (loss) $ (1,978) $ (1,967)
Adjustments to reconcile net
(loss) to net cash (used)
by operating activities:
Unrealized gain (loss) on
securities available for sale - (30,758)
Loss on sale of securities - -
Changes in assets and
liabilities:
(Increase) decrease in
marketable securities - 30,758
Decrease in organization
expense - -
Increase (decrease) in
accounts payable, accrued
expenses and taxes - -
Increase in amounts due to
related party 1,950 1,950
Net cash (used) by operating
activities (28) (17)
Cash flows from investing
activities:
Proceeds from sale of
securities - -
Net cash provided by
investing activities - -
Net increase (decrease)
in cash and cash equivalents (28) (17)
Cash and cash equivalents,
beginning of year 359 471
Cash and cash equivalents,
end of year $ 331 $ 454
Supplemental disclosures of
cash flow information:
Cash received from interest income $ 2 $ 3
See accompanying notes to unaudited financial statements.
HARVEST CAPITAL CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1.
In the opinion of the Company, the accompany ing unaudited
financial statements contain all adjustments (consisting of only
normal recurring adjustments) which in the opinion of management
are necessary in order to present fairly the financial position as
of July 31, 1999 and 1998, the results of operations for the three
month periods ended July 31, 1999 and 1998 and cash flows for the
three month periods ended July 31, 1999 and 1998.
While the Company believes that the disclosures presented are
adequate to make the information not misleading, it is suggested
that these financial statements be read in conjunction with the
Company's audited financial statements for its fiscal years ended
April 30, 1999 and 1998 appearing elsewhere herein.
The results of operations for the three month period ended
July 31, 1999 are not necessarily indicative of the results of
operations for the entire fiscal year ending April 30, 2000.
<PAGE>
HARVEST CAPITAL CORPORATION AND SUBSIDIARY
SCHEDULE 1 - MARKETABLE SECURITIES - OTHER INVESTMENTS
COL. A COL. B COL. C COL. D COL. E
NAME AND NUMBER OF SHARES COST OF MARKET VALUE AMOUNT AT WHICH
ISSUER AND OR UNITS- EACH OF EACH ISSUE EACH PORTFOLIO
TITLE OF ISSUE PRINCIPAL OF ISSUE AT BALANCE OF EQUITY
BONDS OR NOTES SHEET DATE SECURITY ISSUES
AND EACH OTHER
SECURITY ISSUE
IS CARRIED IN
THE BALANCE
SHEET
JLM Couture, Inc.
- -Common Shares
(Unregistered) 25,407 $38,111 $ 50,814 $ 50,814
JLM Couture, Inc.
- -Common Shares
(Unregistered) 53,333 32,000 106,666 106,666
78,740 $70,111 $157,480 $157,480
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> YEAR 3-MOS
<FISCAL-YEAR-END> APR-30-2000 APR-30-2000
<PERIOD-END> APR-30-1999 JUL-31-1999
<CASH> 359 331
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 359 331
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 157,839 157,811
<CURRENT-LIABILITIES> 55,191 57,141
<BONDS> 0 0
0 0
0 0
<COMMON> 8,900 8,900
<OTHER-SE> 93,748 91,770
<TOTAL-LIABILITY-AND-EQUITY> 157,839 157,811
<SALES> 8 2
<TOTAL-REVENUES> 8 2
<CGS> 0 0
<TOTAL-COSTS> 7,920 1,980
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (7,912) (1,978)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (7,912) (1,978)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (7,912) (1,978)
<EPS-BASIC> 0 0
<EPS-DILUTED> 0 0
</TABLE>
