<PAGE>
U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended June 30, 1999
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File No. 33-9782-LA
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HORTITECH, INC.
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(Name of Small Business Issuer in its Charter)
UTAH 87-04444506
---- ----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
Suite 210, 580 Hornby Street
Vancouver, British Columbia, Canada V6C 3B6
---------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (604)-687-6991
N/A
---
(Former Name or Former Address, if changed since last Report)
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Company was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PAST FIVE YEARS)
Not applicable.
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:
June 30, 1999
Common - 18,846,170 shares
DOCUMENTS INCORPORATED BY REFERENCE
A description of any "Documents Incorporated by Reference" is
contained in Item 6 of this Report.
Transitional Small Business Issuer Format Yes X No
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Financial Statements of the Company required to be filed with
this 10-QSB Quarterly Report were prepared by management and commence on the
following page, together with related Notes. In the opinion of management,
the Financial Statements fairly present the financial condition of the
Company.
<TABLE>
HORTITECH, INC.
(A Development Stage Company)
Balance Sheets
<CAPTION>
ASSETS
June 30 December 31,
1999 1998
CURRENT ASSETS (Unaudited)
<S> <C> <C>
Cash $ 13,396 $ 19,088
Total Current Assets 13,396 19,088
OTHER ASSETS
Notes receivable (Note 4) - -
Total Other Assets 0 0
TOTAL ASSETS $ 13,396 $ 19,088
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 27,896 $ 28,292
Accounts payable - related parties 90,593 81,366
Advances payable (Note 5) 65,000 65,000
Note payable (Note 6) 99,525 97,830
Accrued interest payable 12,447 12,447
Total Current Liabilities 295,461 284,935
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: $0.001 par value; authorized
200,000,000 shares; 18,846,170 shares issued
and outstanding 18,846 18,846
Additional paid-in capital 387,119 387,119
Deficit accumulated prior to November 29, 1989 (213,710) (213,710)
Deficit accumulated during the development
stage (474,320) (458,102)
Total Stockholders' Equity (Deficit) (282,065) (265,847)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 13,396 $ 19,088
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
HORTITECH, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
<CAPTION>
From
Inception of
Development
For the Stage on
Three Months End November 29,
June 30 1989 Through
June 30
1999 1998 1999
<S> <C> <C> <C>
REVENUES $ - $ - $ -
GENERAL AND AMINISTRATIVE EXPENSES 6,104 18,299 474,320
NET LOSS $ (6,104) $(18,299) $(474,320)
BASIC LOSS PER SHARE $ (0.00) $ (0.00)
WEIGHTED NUMBER OF
SHARES OUTSTANDING 18,846,170 **********
</TABLE>
The accompanying notes are an integral part of these financial statement
<TABLE>
HORTITECH, INC.
(A Development Stage Company)
Statements of Stockholders'
Equity (Deficit)
<CAPTION>
Additional
Common Stock Paid-in Accumulated
Shares Amount Capital Deficit
<S> <C> <C> <C> <C>
Balance, October 24, 1986 $ - $ - $ -
Issue of common stock to
officers and directors at
$5.00 per share 1,000 1 4,999 -
Net loss for the year ended
December 31, 1986 - - - -
Balance, December 31, 1986 1,000 1 4,999 -
Issue of common stock to
public at $250 per share 600 1 149,999 -
Less stock offering cost - - (19,880) -
Issue of common stock in
exchange for subsidiary 270 - 500 -
Issue of common stock for
services rendered at approximately
$5.00 per share 505 - 2,527 -
Issue of common stock in private
placement at approximately
$12.50 per share 6,045 6 75,557 -
Net loss for the year ended
December 31, 1987 - - - (176,716)
Balance, December 31, 1987 8,420 8 213,702 (176,716)
Net loss for the year ended
December 31, 1988 - - - (36,504)
Balance, December 31, 1988 8,420 8 213,702 (213,220)
Net loss for the year ended
December 31, 1989 - - - (490)
Balance, December 31, 1989 8,420 $ 8 $ 213,702 $ (213,710)
Contribution of capital - - 35 -
Net loss for the year ended
December 31, 1990 - - - (727)
Balance, December 31, 1990 8,420 8 213,737 (214,437)
Net loss for the year ended
December 31, 1991 - - - (224)
Balance, December 31, 1991 8,420 8 213,737 (214,661)
Net loss for the year ended
December 31, 1992 - - - (236)
Balance, December 31, 1992 8,420 8 213,737 (214,897)
Net Loss for the year ended
December 31, 1993 - - - (235)
Balance, December 31, 1993 8,420 8 213,737 (215,132)
Common stock issued for cash
and services at approximately
$0.43 per share 14,134 14 5,986 -
Net loss for the year ended
December 31, 1994 - - - (9,162)
Balance, December, 31, 1994 22,554 22 219,723 (224,294)
Common stock issued for cash
at $5.00 per share 2,000 2 9,998 -
Forgiveness of debt - - 4,759 -
Net loss for the year ended
December 31, 1995 - - - (6,019)
Balance, December 31, 1995 24,554 $ 24 $ 234,480 $ (230,313)
Common stock issued for cash
at $0.05 per share 360,000 360 17,640 -
Common stock issued for cash
at an average of $0.01 18,461,600 18,461 135,000 -
per share
Stock split adjustment 16 1 (1) -
Net loss for the year ended
December 31, 1996 - - - (25,839)
Balance, December 31, 1996 18,846,170 18,846 387,119 (256,152)
Net loss for the year ended
December 31, 1997 - - - (188,917)
Balance, December 31, 1997 18,846,170 18,846 387,119 (445,069)
Net loss for the year ended
December 31, 1998 (226,743)
Balance, December 31, 1998 - - - (671,812)
Net loss for the six months
ended June 30, 1999
(unaudited) - - - (16,218)
Balance, June 30, 1999
(unaudited) 18,846,170 $ 18,846 $ 387,119 $ (688,030)
</TABLE>
<TABLE>
HORTITECH, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
<CAPITON>
From
Inception of
Development
For the For the Stage on
Three Months End Six Months End November 29,
June 30 June 30 1989 Through
June 30
1999 1998 1999 1998 1999
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Income (loss) from operations $(6,104) $(18,299)(16,218)(112,066)(474,320)
Adjustments to reconcile net
(loss) to net cash provided
by operating activities:
Forgiveness of debt - - 4,759
Stock issued for services - - 1,000
Amortization of discount on
note receivable - - (3,982) (20,212)
Changes in operating assets and liabilities:
Increase in accounts payable -
related parties 4,703 3,666 9,227 35,176 90,593
Increase in allowance for bad debt 94,299
Increase in accrued interest
payable - - - - 12,447
Increase in advances payable - - - - 65,000
(Increase) decrease in
refundable - 15,000 - - -
deposits - - - -
(Increase) decrease in
prepaid expenses - - - 7,500 -
Increase (decrease) in
accounts payable (3,370) 2,033 (396) (9,428) 27,896
Net Cash Used by Operating
Activities (4,771) 2,400 (7,387) (82,800)(198,538)
CASH FLOWS FROM INVESTING ACTIVITIES
Collection of note receivable - - - - 70,000
(Increase) in note receivable - - - - (144,087)
Net Cash Used by Investing
Activities - - - - (74,087)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash received from loan - (3,360) - 102,105 -
Increase in notes payable 105 - 1,695 - 99,525
Cash contributed to additional
paid-in capital - - - - 35
Stock offering cost - - - - -
Issuance of common stock - - - - 186,461
Net Cash Used by Financing
Activities 105 (3,360) 1,695 102,105 286,021
Increase (Decrease) in Cash $(4,666) $ (960) $(5,692)$ 19,305 $ 13,396
CASH AT BEGINNING OF PERIOD 18,062 24,018 19,088 3,753 -
CASH AT END OF PERIOD $13,396 $23,058 $13,396 $ 23,058 $ 13,396
SUPPLEMENTAL CASH FLOWS
INFORMATION:
Interest $ - $ - $ - $ - $ -
Taxes $ - $ - $ - $ - $ -
NON CASH FINANCING ACTIVITIES:
Stock issued for services $ - $ - $ - $ - $ 1,000
</TABLE>
HORTITECH, INC.
(A Development Stage Company)
June 30, 1999
(Unaudited)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
The financial statements presented are those of Hortitech, Inc. (a
development stage company). The Company was incorporated under the laws
of the State of Utah on October 24, 1986. The Company completed a public
offering of its common stock in November 1987. The gross proceeds
received by the Company were $150,000. On August 31, 1987, the Company
completed the acquisition of all the outstanding common shares of Western
Antenna Research, Inc., a Colorado corporation. The Company's name was
subsequently changed to Western Antenna Corporation. After two years of
unsuccessful operations, the name of the Company was changed to Hortitech,
Inc. on November 29, 1989 and the Company was reclassified as a
development stage company. The Company was incorporated for the purpose
of providing a vehicle which could be used to raise capital and seek
business opportunities believed to hold a potential for profit.
Accounting Method
The Company's financial statements are prepared using the accrual method
of accounting. The Company has adopted a calendar year end.
Cash Equivalents
The Company considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.
Provision for Taxes
At June 30, 1999, the Company has net operating loss carryforward of
approximately $688,030 that may be offset against future taxable income
through 2013. No tax benefit has been reported in the financial
statements, because the Company believes there is a 50% or greater chance
the carryforward will expired unused. Accordingly, the potential tax
benefits of the loss carryforward have been offset by a valuation
allowance of the same amount.
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.
Significant Accounting Policies
Additional accounting policies will be determined when principal
operations begin.
NOTE 2 GOING CONCERN
The Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company has no current source of revenue. Without
realization of additional capital, it would be unlikely for the Company to
continue as a going concern. It is management's plan to seek additional
capital through a merger with an existing operating company. In the
interim, shareholders of the Company have committed to meeting its minimal
operating expenses.
NOTE 3 COMMON STOCK
On July 5, 1996, the Company issued 360,000 shares of common stock for cash
at approximately $0.05 per share.
On July 8, 1996 the Board of Directors approved a 1 for 50 reverse stock
split. The reverse stock split is reflected in these financial statements
on a retroactive basis. The Company then issued 18,461,600 shares of post
split common stock for gross proceeds of $153,461.
NOTE 4 NOTE RECEIVABLE
The Company loaned $164,299 to an individual in 1996. The note is
discounted at 8% per annum and was due on May 20, 1998. The Company holds
100,000 shares of "The Beverage Store, Inc." restricted common stock as
collateral. On August 12, 1997, the Company received $70,000 as a partial
payment. The balance at December 31, 1998 was $94,299. An allowance for
bad debt was recorded for $94,299 because the amount is past due.
NOTE 5 ADVANCES PAYABLE
The Company was advanced $1,015,000 to aid in the acquisition of The Indian
Motorcycle Trademark. The acquisition did not take place and the Company
returned $950,000 to the lender. There is a balance of $65,000 which the
Company still owes. The advance is non-interest bearing, and is due on
demand. Interest has been imputed at 8% per annum.
NOTE 6 NOTE PAYABLE
The Company received $ 97,830 in the form of an unsecured note payable
during 1998. The note payable is due upon demand and interest expense has
been imputed at 8% per annum.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
- ------------------
The Company has not engaged in any material operations or had any
revenues from operations during the last two calendar years. The Company's
plan of operation for the next 12 months is to continue to seek the
acquisition of assets, properties or businesses that may benefit the Company
and its stockholders. Management anticipates that to achieve any such
acquisition, the Company will issue shares of its common stock as the sole
consideration for any such acquisition.
During the next 12 months, the Company's only foreseeable cash
requirements will relate to maintaining the Company in good standing or the
payment of expenses associated with reviewing or investigating any potential
business ventures. Such funds may be advanced by management or stockholders as
loans to the Company. Because the Company has not identified any such
ventures as of the date of this Report, it is impossible to predict the amount
of any such loans or advances. However, any such loans or advances should not
exceed $25,000 and will be on terms no less favorable to the Company than
would be available from a commercial lender in an arm's length transaction.
As of the date of this Report, the Company is not involved in any negotiations
respecting any such ventures.
Results of Operations.
- ----------------------
Other than maintaining its good corporate standing in the State of Utah,
compromising and seeking the acquisition of assets, properties or businesses
that may benefit the Company and its stockholders, the Company has had no
material business operations during the two most recent calendar years.
During the quarters ended June 30, 1999 and 1998, the Company had no
business operations, but recorded a net loss of ($6,104) during the quarterly
period ended June 30, 1999, compared with a net loss of ($18,299) during the
quarter ended June 30, 1998.
Liquidity.
- ----------
The Company had cash on hand of $13,396 and $19,088, respectively, at
June 30, 1999, and December 31, 1998.
Year 2000.
- ----------
The Company presently has no material operations, and is presently
seeking a suitable candidate for a merger or acquisition transaction. Due to
its very limited activities and assets, management does not believe that the
change of year to the year 2000 will have any material effect on its business,
results of operations or financial condition.
In seeking out a merger or acquisition target, the Company will take
into account the ways in which the Year 2000 may materially affect the
operations of any such target. However, until such an entity has been
identified, management can not accurately predict how (if at all) the Year
2000 issue may affect the operations of the reorganized Company. At such time
as the Company completes such a reorganization, it will timely disclose all
material Year 2000 issues in the appropriate filing with the Securities and
Exchange Commission.
For the foregoing reasons, the Company has determined that the
potential consequences of the Year 2000 would not have a present material
effect on its business, results of operations or financial condition.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 2. Changes in Securities.
None; not applicable.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of the Company's security holders
during the quarterly period covered by this Report.
Item 5. Other Information.
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
Financial Data Schedule.
(b) Reports on Form 8-K.
None.
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.
HORTITECH, INC.
Date: 8/13/99 By/s/Suzanne L. Wood
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Suzanne L. Wood, President
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this Report has been signed below by the following persons on
behalf of the Company and in the capacities and on the dates indicated:
HORTITECH, INC.
Date: 8/13/99 By/s/Suzanne L. Wood
---------- ------------------------------------
Suzanne L. Wood, President and
Director
Date: 8/13/99 By/s/Barry D. Russell
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Barry D. Russell, Director,Treasurer
and Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 13396
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 13396
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 13396
<CURRENT-LIABILITIES> 295461
<BONDS> 0
0
0
<COMMON> 18846
<OTHER-SE> (300911)
<TOTAL-LIABILITY-AND-EQUITY> 13396
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 6104
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (6104)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> (6104)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6104)
<EPS-BASIC> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
