<PAGE> 1
Exhibit 99.1
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
FINANCIAL STATEMENTS
MARCH 31, 1999 AND MARCH 31, 2000
<PAGE> 2
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
INDEX TO FINANCIAL STATEMENTS
March 31, 1999 and March 31, 2000
DESCRIPTION PAGE
-------------------------------------------------------------------------------
Accountant's Report 3
Combined and Consolidated Balance Sheets 4-5
Combined and Consolidated Statements of Income 6
Combined and Consolidated Statements of Cash Flows 7
Combined and Consolidated Statements of Stockholders' Equity 8
Notes to the Combined and Consolidated Financial Statements 9-13
<PAGE> 3
ALEX N. CHAPLAN & ASSOCIATES
Certified Public Accountant Member
ALEX N. CHAPLAN, C.P.A. 23622 Calabasas Road, Suite 107A Society of
Calabasas, California 91308 California
(818) 591-1901 FAX (818) 222-0727 Accountants
To the Board of Directors and Stockholders
Whitehall Limited, Inc.
FKA Cambridge Universal Corporation
In our opinion, the accompanying combined and consolidated balance sheets and
the related combined and consolidated statements of income and of cash flows
present fairly, in all material respects, the financial position of Whitehall
Limited, Inc. at March 31, 1999 and March 31, 2000 and the results of its
operations and its cash flows for the fiscal years then ended, in conformity
with generally accepted accounting principles. 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.
Included herein, we have combined the financial information for Whitehall
Homes, Inc. and affiliated corporations (nine corporations) for the period from
April 1, 1998 to December 31, 1998 with the consolidated financial information
for the period from January 1, 1999 to March 31, 1999 for purposes of comparing
fiscal years March 31, 1999 with March 31, 2000.
We conducted our audits in accordance with generally accepted auditing
standards which require that we 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit provide a reasonable basis for the opinion expressed above.
/s/ Alex N. Chaplan & Associates
--------------------------------
Alex N. Chaplan & Associates
July 11, 2000
<PAGE> 4
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
COMBINED AND CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 1999 AND 2000
<TABLE>
<CAPTION>
ASSETS
March 31,
---------------------------
1999 2000
---------- -----------
<S> <C> <C>
ASSETS
Cash in Banks $ 149,101 $ 580,035
Due to affiliated companies 132,381 145,546
Due from Stockholders 0 466,323
Investments (At Cost) 0 165,114
---------- -----------
TOTAL CURRENT ASSETS 281,482 1,357,018
---------- -----------
CONSTRUCTION COSTS IN PROGRESS
Land and development costs 3,988,956 1,537,095
Homes under construction and furnished models 3,430,033 5,404,379
---------- -----------
TOTAL CONSTRUCTION COSTS IN PROGRESS 7,418,989 6,941,474
---------- -----------
PROPERTY AND EQUIPMENT
Office land and building 866,241 1,466,241
Office furniture and fixtures 57,253 55,553
Construction equipment 78,880 96,862
Vehicles 13,713 86,018
---------- -----------
TOTAL 1,016,087 1,704,674
Less: Accumulated Depreciation 9,190 53,962
---------- -----------
TOTAL PROPERTY AND EQUIPMENT 1,006,897 1,650,712
---------- -----------
OTHER ASSETS
Deposit on lot 50,000 63,748
Prepaid model lease 79,922 79,990
Miscellaneous 5,890 4,600
Sales office and model furnishings 0 109,368
---------- -----------
TOTAL OTHER ASSETS 135,812 257,706
---------- -----------
TOTAL ASSETS $8,843,180 $10,206,910
========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE> 5
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
COMBINED AND CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 1999 AND 2000
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
March 31,
------------------------------
1999 2000
----------- ------------
<S> <C> <C>
LIABILITIES
Accounts payable-trade $ 488,618 $ 1,120,868
Notes payable to banks 389,942 410,874
Note payable (secured by office building) 364,480 353,054
Notes payable - other 300,000 300,000
Land and development loans 487,500 72,100
Construction loans payable 1,534,437 3,072,931
Due to affiliated companies 299,619 0
Customers' deposits 533,679 1,244,207
Due to stockholder 84,477 172,266
----------- ------------
TOTAL LIABILITIES 4,482,752 6,746,300
----------- ------------
NOTES PAYABLE -STOCKHOLDERS 2,500,000 1,843,481
----------- ------------
STOCKHOLDERS' EQUITY
Preferred stock $.10 par value authorized, 100,000,000 shares
issued shares - none 0 0
Common stock; $.10 par value authorized, 500,000,000 shares
issued and outstanding 8,946,000 shares 894,600 894,600
Paid in capital 1,170,027 1,170,027
Retained earnings (deficit) (204,199) (447,498)
----------- ------------
TOTAL STOCKHOLDERS' EQUITY 1,860,428 1,617,129
----------- ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 8,843,180 $ 10,206,910
=========== ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
-5-
<PAGE> 6
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
COMBINED AND CONSOLIDATED STATEMENT OF INCOME
FOR THE FISCAL YEARS ENDED MARCH 31, 1999 AND 2000
<TABLE>
<CAPTION>
March 31,
-----------------------------
1999 2000
----------- -----------
<S> <C> <C>
INCOME
Sales of homes and lots $ 3,847,973 $ 8,582,410
Management fees 239,944 7,600
Real estate commissions 72,777 13,654
Interest income 9,925 15,897
Other 202,852 153,853
----------- -----------
TOTAL INCOME 4,373,471 8,773,414
----------- -----------
COST OF HOMES AND LOTS 2,773,813 7,218,735
----------- -----------
NET INCOME
(BEFORE OPERATING EXPENSES) 1,599,658 1,554,679
----------- -----------
OPERATING EXPENSES
Selling and General 622,538 542,243
Personnel 540,741 531,558
Office 219,447 394,935
Real estate commissions 134,478 208,752
Interest Expense 172,202 126,657
----------- -----------
TOTAL OPERATING EXPENSES 1,689,406 1,804,145
----------- -----------
NET (LOSS) $ (89,748) $ (249,466)
=========== ===========
NET (LOSS) PER COMMON SHARE $ (0.01003) $ (0.02789)
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-6-
<PAGE> 7
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
COMBINED AND CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE FISCAL YEARS ENDED MARCH 31, 1999 AND 2000
<TABLE>
<CAPTION>
March 31,
-----------------------------
1999 2000
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net (Loss) $ (89,748) $ (249,466)
----------- -----------
Adjustments to reconcile net (loss) to net cash provided by
operating activities:
Depreciation 42,288 44,772
Increase/(decrease) in:
Land and development costs 234,300 2,451,861
Homes under construction and furnished models (1,328,782) (1,974,346)
Customer deposits 25,859 710,528
Accounts payable and accrued liabilities 146,756 632,250
Property and equipment 10,840 (688,587)
Other assets (71,488) (121,894)
Due from/to affiliates 112,627 (312,784)
Due from stockholders 0 (378,534)
Deconsolidation - U-Store It 0 18,796
----------- -----------
TOTAL ADJUSTMENTS (827,600) 382,062
----------- -----------
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES (917,348) 132,596
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Net Cash provided by investing activities 0 (165,114)
NET CASH PROVIDED BY FINANCING ACTIVITIES
Land and development loans (9,792) (415,400)
Construction loans 1,056,111 1,538,494
Notes payable (90,156) 9,506
Stockholder loans 150,612 (669,148)
Distribution to stockholders (226,863) 0
----------- -----------
NET CASH FLOWS PROVIDED BY INVESTMENT
AND FINANCING ACTIVITIES 879,912 463,452
----------- -----------
NET INCREASE (DECREASE) IN CASH (37,436) 430,934
NET CASH - BEGINNING OF PERIOD 186,537 149,101
----------- -----------
NET CASH - END OF PERIOD $ 149,101 $ 580,035
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-7-
<PAGE> 8
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
COMBINED AND CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE FISCAL YEARS ENDED MARCH 31, 1999 AND 2000
<TABLE>
<CAPTION>
Common Stock Capital in Retained
--------------------- Excess of Earnings
Shares Amount Par Value <Deficit>
--------- -------- ------------ ------------
<S> <C> <C> <C> <C>
Balance-April 1, 1998 (Nine Corporations) 6,900 $ 6,900 $ 1,164,110 $ (907,003)
Add: Stockholders capital contribution 110,431
Less: Stockholders profit distribution under Sub-
Chapter S of the Internal Revenue Code (337,294)
Net Income<Loss> for the nine months
ended December 31, 1998 (75,997)
--------- -------- ------------ ------------
Balance-December 31, 1998 - Nine corporations (before
sale of assets and liabilities to Whitehall Homes II, Inc.) 6,900 $ 6,900 $ 1,274,541 $ (1,320,294)
Add: Increase to fair value, assets, and liabilities of
nine corporations sold to Whitehall Homes II,
Inc.-as of January 1, 1999 4,413,031
Less: Note payable-stockholders (2,500,000)
Common stock retired-nine corporations (6,900) (6,900) (1,313,394) 1,320,294
--------- -------- ------------ ------------
Balance-January 1, 1999-Whitehall Homes II, Inc. 0 0 1,874,178 0
========= ======== ============ ============
WHITEHALL LIMITED, INC., FKA CAMBRIDGE UNIVERSAL CORPORATION:
Balance-January 1, 1999 7,100,000 190,448 $ 0 $ (190,448)
Less: Reverse stock split-1 share for each 3 shares
outstanding 4,733,333
--------- -------- ------------ ------------
2,366,667 190,448 0 (190,448)
Add: Common stock issued to acquire Whitehall
Homes II, Inc., effective January 1, 1999 4,608,268 1,874,179
Common stock issued to the family of the
major stockholders 537,109
Common stock issued to complete acquisition
of Whitehall Homes II, Inc. as authorized by
the Board of Directors:
Consulting Fees 1,350,000
Employees 57,500
Sub-Contractors 40,000
Homes Buyers 15,400
Less: Unreconciled Shares (28,944)
Net <Loss> for the three months ended March
31, 1999 (13,751)
To adjust from no par common stock to $.10 par
value common stock 704,152 (704,152)
--------- -------- ------------ ------------
Balance-March 31, 1999 8,946,000 894,600 1,170,027 (204,199)
--------- -------- ------------ ------------
Add: U-Store It-Adjustment for deconsolidation 6,167
Net <Loss> For The Fiscal Year Ended March
March 31, 2000 (249,466)
--------- -------- ------------ ------------
Balance-March 31, 2000 0 $ 0 $ 0 $ (243,299)
========= ======== ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
-8-
<PAGE> 9
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
AS OF MARCH 31, 1999 AND MARCH 31, 2000
NOTES TO THE COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Combination and Consolidation:
The Combined and Consolidated Financial Statements included the
accounts of Whitehall Homes, Inc. and Affiliated Companies and the company and
its wholly owned subsidiary, Whitehall Homes II, Inc. after elimination of all
significant inter-company accounts and transactions:
On June 17, 1999, the closing date, but effective January 1, 1999,
Whitehall Homes II, Inc. entered into a definitive agreement to acquire all of
the outstanding capital stock of Whitehall Homes, Inc., U-Store It, Inc.,
Whitehall Homes at Avalon, Inc., Bermuda Development Corporation, Whitehall
Associates, Inc., Fairway Lakes Homes, Inc., Whitehall Homes at Maple Hammock,
Inc., Whitehall Management, Inc., and Beekman Village Development Corporation.
The agreed purchase price consists of a promissory note in the amount of
$2,500,000 bearing interest at the rate of seven percent (7%) per annum, all
interest and principal paid in seven (7) years from the date of execution and
delivery; and (b) the issuance of the common stock of Whitehall Homes II, Inc.
The Stockholders of Cambridge Universal Corporation met on June 17,
1999 and approved the following resolutions and actions of their Board of
Directors:
1. Approved a reverse stock split of 1 common share for each 3
common shares outstanding.
2. Approved the exchange of 4,608,268 of post reverse stock
split shares for all the issued and outstanding common shares
of Whitehall Homes II, Inc. thereby making Whitehall Homes
II, Inc. a wholly owned subsidiary.
3. Approved the change of the corporate domicile from the state
of Colorado to the state of Florida.
4. Approved the company name change from Cambridge Universal
Corporation to Whitehall Limited, Inc.
5. Approved the effective date of these resolutions to be
retroactive to January 1, 1999.
As a result of the above actions by the Stockholders and Board of
Directors, the Corporation's financial statements were prepared as combined and
consolidated financial statements for the fiscal year ended March 31, 1999 to
conform to the parent company fiscal year of March 31, 1999.
-9-
<PAGE> 10
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
AS OF MARCH 31, 1999 AND MARCH 31, 2000
NOTES TO THE COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Effective, January 1, 1998, the original sale of Whitehall Homes, Inc.
and eight corporations to Whitehall Homes II, Inc., contained a fair market
value of $4,413,032. Upon further review by management, it was concluded that
the booked valuations were correct in total, but were inadvertently allocated
to two properties. The land value for Bermuda Development Corporation was
overvalued by $600,000 and the corporate office property was undervalued by a
similar amount. Management has corrected the books and records as of March 31,
2000.
Property and Equipment is depreciated over the estimated useful lives
of the assets using the straight-line method. Expenditures for maintenance,
repairs, renewals, and betterments, which do not materially prolong useful
lives of the assets are charged to income as incurred. The cost of property
retired or sold and the related accumulated depreciation is removed from the
accounts and any gain or loss from sales is recorded as income.
NOTE 2 - DESCRIPTION OF THE BUSINESS
Whitehall Homes, Inc. and Affiliated Companies were originally formed
in 1985 by the major stockholders to develop land and construct single family
and/or multi family housing either in their own affiliated companies or in
joint ventures with others. All project cost are recorded on a specific job
basis. All properties are carried at the lower of carrying amount or fair value
less cost to sell. Project costs of real estate projects may be direct or
indirect. Direct costs that are related to the acquisition development, and
construction of a real estate project are capitalized as project costs.
Indirect costs or real estate projects that can be identified clearly to
specific projects under development or constructions are capitalized as project
costs, or allocated to several real estate projects under development or
construction on a reasonable basis. Indirect cost on real estate projects not
under development or construction are expensed as incurred, including general
and administrative expenses.
NOTE 3 - INVESTMENTS
The Company has invested excess working capital in short term
securities during this period in the amount of $165,114. These short term
securities are readily convertible to known amounts of cash and present
insignificant risk of changes in value because of changes in interest rates.
-10-
<PAGE> 11
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
AS OF MARCH 31, 1999 AND MARCH 31, 2000
NOTES TO THE COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 4-DEBT
The Companies were indebted to various lending institutions as
follows:
<TABLE>
<CAPTION>
March 31,
---------- ----------
1999 2000
---------- ----------
<S> <C> <C>
Land and Land Development Loans-secured by land and
Land improvements prior to building activities:
Bermuda Development Corp.-Interest @1% to 1.50%
over prime rate $ 310,000 40,000
Whitehall Homes at Avalon, Inc. Interest @1.00 over
prime rate 177,500 32,100
---------- ----------
$ 487,500 $ 72,100
========== ==========
Construction Loans-secured by specific homes under
construction, interest at 1.00% to 1.50% over prime
rate, maximum loans may net exceed $3,087,400 at
March 31, 1999 and March 31, 2000 $1,534,437 3,072,931
Notes Payable:
Secured by mortgage on land and buildings, interest at
1.50% over prime rate. Payable on a 20 year schedule,
all due and payable on February 26, 2006 364,480 353,054
Installment Notes-secured by computer equipment and
loader, due April 2002 48,125 0
Secured by mortgage on U-Store It, Inc. land, payable to
three individuals upon sale. Interest at 12.00% 300,000 300,000
Unsecured line of credit payable to bank, interest @1.50%
over prime rate guaranteed by stockholders 41,818 110,874
Unsecured note; interest @1% over prime rate 200,000 200,000
Unsecured note; interest @2.25% over prime rate; due
September 2, 1999 renewed to September 2, 2000 100,000 100,000
---------- ----------
$1,054,423 $4,208,959
========== ==========
</TABLE>
-11-
<PAGE> 12
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
AS OF MARCH 31, 1999 AND MARCH 31, 2000
NOTES TO THE COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 5-NOTE PAYABLE-STOCKHOLDERS
The original agreement with Whitehall Homes, Inc. and eight other
corporation and Whitehall Homes II, Inc. to purchase at estimated fair value,
their assets less liabilities in exchange for commons tock of Whitehall Homes
II, Inc., will be amended to adjust for the following:
1. The corporation known as U-Store It, Inc. (A Florida
Corporation), will be returned to the major stockholders
since the nature of its business is inconsistent with the
primary business of the Company.
2. As of January 1, 1999, the Company acquired U-Store It, Inc.
for the following net assets at estimated fair value:
<TABLE>
<S> <C> <C>
Cash in bank $ 19,540
Accounts and Notes Receivable 142,834
Land and Development Costs 1,023,024
-----------
Total Assets (at fair value) 1,185,398
Less: Notes and Loans Payable 471,250
Customer's Deposit 45,000 516,250
----------- ---------
Net Assets $ 669,148
=========
</TABLE>
The Company charged the major stockholders' Note Payable - Stockholders in the
amount of $669,148. In addition, the Net <Loss> of U-Store It, Inc. was
eliminated from the income statement for the fiscal year ended March 31, 2000
and the loss was credited to retained earnings in the amount of $6,167.
-12-
<PAGE> 13
WHITEHALL LIMITED, INC.
FKA CAMBRIDGE UNIVERSAL CORPORATION AND
WHITEHALL HOMES, INC. AND AFFILIATED COMPANIES
AS OF MARCH 31, 1999 AND MARCH 31, 2000
NOTES TO THE COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 6 - INCOME TAXES
The former stockholders of the companies had elected to be taxed under
the provisions of Sub Chapter "S" of the United States Internal Revenue Code
and as a result, the Corporation was not liable for Federal Income Taxes in
prior years. The current period required no provision for federal or state
income taxes due to its net operating losses.
NOTE 7 - PERVASIVENESS OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumption that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
NOTE 8 - COMMITMENTS AND CONTINGENCY
Whitehall Limited, Inc. and its wholly owned subsidiary Whitehall
Homes II, Inc. have secured various lines of credit with financial
institutions. The major stockholders have guaranteed certain loans and/or
assigned a life insurance policy as security.
-13-
