U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-QSB
Quarterly Report Under
the Securities Exchange Act of 1934
For Quarter Ended: May 31, 1997
Commission File Number: 0-21099
HA SPINNAKER, INC.
(Exact name of small business issuer as specified in its charter)
Colorado
(State or other jurisdiction of incorporation or organization)
84-1128300
(IRS Employer Identification No.)
5650 Greenwood Plaza, #216
Englewood, Colorado
(Address of principal executive offices)
80111
(Zip Code)
(303) 741-1118
(Issuer's Telephone Number)
(Former name, former address and former fiscal year,
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 Securities Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days: Yes
__X__ No ____.
The number of shares of the registrant's only class of common stock issued and
outstanding, as of May 31, 1997, was 28,600,000 shares.
<PAGE>
PART I
ITEM 1. FINANCIAL STATEMENTS.
The unaudited financial statements for the six month period ended May 31,
1997, are attached hereto.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Financial
Statements and notes thereto included herein.
The Company generated no revenues during the six month period ending May
31, 1997. Management of the Company anticipates that the Company will not
generate any significant revenues until the Company accomplishes its business
objective of merging with a nonaffiliated entity or acquiring assets from the
same.
The Company's securities are currently not liquid. There are no market
makers in the Company's securities and it is not anticipated that any market
will develop in the Company's securities until such time as the Company
successfully implements its business plan of engaging in a business opportunity,
either by merger or acquisition of assets. The Company presently has no liquid
financial resources to offer such a candidate and must rely upon an exchange of
its stock to complete such a merger or acquisition.
Because the Company is not required to pay rent or salaries to any of its
officers or directors, management believes that the Company has sufficient funds
to continue operations through the foreseeable future.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS - NONE
ITEM 2. CHANGES IN SECURITIES - NONE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES - NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - NONE.
ITEM 5. OTHER INFORMATION - NONE.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K -
(a) Exhibits
EX-27 Financial Data Schedule
(b) Reports on Form 8-K
2
<PAGE>
The Registrant filed a Form 8-K dated July 21, 1997, reporting the
execution of a letter of intent on July 11, 1997, with Zaba International
Holdings USA, Inc. ("Zaba"), a privately held Nevada corporation, whereby the
Registrant agreed in principle to acquire all of the issued and outstanding
shares of Zaba in exchange for issuance by the Registrant of 9,628,660
previously unissued "restricted" common stock of the Registrant. A copy of the
letter of intent with Zaba was annexed to the Form 8-K as an Exhibit.
The relevant terms of the transaction required the Company to issue to the
Zaba shareholders an aggregate of 9,628,660 "restricted" common shares,
representing 80% of the Company's then outstanding common stock, in exchange for
all of the issued and outstanding shares of Zaba. This transaction closed on
August 4, 1997.
3
<PAGE>
H A SPINNAKER, INC.
(A Development Stage Company)
Financial Statements
May 31, 1997
(unaudited)
4
<PAGE>
<TABLE>
H A Spinnaker, Inc.
(A Development Stage Company)
BALANCE SHEET
May 31, 1997
(Unaudited)
<CAPTION>
ASSETS
<S> <C>
CURRENT ASSETS
Cash and cash equivalents $ 329
--------
Total current assets 329
--------
TOTAL ASSETS $ 329
========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable - trade $ 505
Accounts payable - related party -
--------
Total current liabilities 505
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.0001 par value, 1,000,000,000
share authorized; 28,600,000 shares issued
and outstanding 2,860
Preferred stock, $0.001 par value, 100,000,000
shares authorized; no shares issued and
outstanding -
Additional paid-in capital 44,353
Deficit accumulated during the development stage (47,389)
--------
Total stockholders' equity (deficit) (176)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 329
========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
1
5
<PAGE>
<TABLE>
H A Spinnaker, Inc.
(A Development Stage Company)
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT
(Unaudited)
<CAPTION>
Period Three Three Six Six
September months months months months
28, 1988 ended ended ended ended
(Inception) May 31, May 31, May 31, May 31,
to May 31, 1997 1996 1997 1997
1997
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES
Investment income $ 393 $ - $ - $ - $ -
EXPENSES
Office expenses 2,137 1,115 - 2,137 -
Wages 25,000 - - - -
Rent 7,200 - - - -
Legal and accounting 12,945 581 - 1,039 -
Amortization 500 - - - -
----------- ----------- ----------- ----------- -----------
Total expenses 47,782 1,696 - 3,176 -
----------- ----------- ----------- ----------- -----------
NET LOSS (47,389) (1,696) - (3,176) -
Accumulated deficit
Balance, beginning
of period - (45,693) (43,344) (44,213) (43,344)
----------- ----------- ----------- ----------- -----------
Balance, end of
period $ (47,389) $ (47,389) $ (43,344) (47,389) (43,344)
=========== =========== =========== =========== ===========
NET LOSS PER SHARE $ (NIL) $ (NIL) $ (NIL) $ (NIL) $ (NIL)
=========== =========== =========== =========== ===========
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 28,600,000 28,600,000 28,600,000 28,600,000 28,600,000
=========== =========== =========== ===========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
2
6
<PAGE>
<TABLE>
H A Spinnaker, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Period Six Six
September months months
28, 1988 ended ended
(Inception) May 31, May 31,
to May 31, 1997 1996
1997
--------- --------- ---------
<S> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $ (47,389) $ (3,176) $ -
Noncash items included in
net loss:
Amortization 500 - -
Rent 2,918 - -
Wages 23,054 - -
Stock issued for services 2,000 - -
Changes in:
Current liabilities 505 3,636 -
--------- --------- ---------
Net cash used by operating
activities (18,412) (6,812) -
CASH FLOWS FROM
INVESTING ACTIVITIES
Increase in organization costs (500) - -
--------- --------- ---------
Net cash used by investing
activities (500) - -
CASH FLOWS FROM
FINANCING ACTIVITIES
Expenses paid by shareholder 7,141 7,141
Issuance of common stock to
founding shareholders 12,100 - -
--------- --------- ---------
Net cash provided by financing
activities 19,241 7,141 -
--------- --------- ---------
Net change in cash 329 329 -
Cash, beginning of period - - -
--------- --------- ---------
Cash, end of period $ 329 $ 329 $ -
========= ========= =========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
3
7
<PAGE>
H A Spinnaker, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. Management's representation of interim financial information
------------------------------------------------------------
The accompanying financial statements have been prepared by H.A.
Spinnaker, Inc. without audit pursuant to the rules and regulations
of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting
principles have been condensed or omitted as allowed by such
rules and regulations, and management believes that the disclosures
are adequate to make the information presented not misleading.
These financial statements include all of the adjustments which,
in the opinion of management, are necessary to a fair presentation
of financial position and results of operations. All such
adjustments are of a normal and recurring nature. These financial
statements should be read in conjunction with the audited financial
statements at November 30, 1996.
2. Subsequent Event
----------------
Effective August 4, 1997, HA Spinnaker, Inc. (the "Company")
consummated a merger with Zaba International Holdings USA, Inc.
("Zaba"), a privately held Nevada corporation, whereby the Company
acquired all of the issued and outstanding shares of Zaba in
exchange for issuance by the Company of 9,628,660 previously
unissued "restricted" common shares (post-reverse split).
Relevant thereto, the Company undertook a "reverse split" of its
common stock, whereby one (1) share of common stock was issued in
exchange for every twelve (12) shares of common stock then issued
and outstanding.
4
8
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
H A SPINNAKER, INC.
(Registrant)
Dated: August 14, 1997
By: s/Gregory W. Skufca
Gregory W. Skufca,
President
9
<PAGE>
HA SPINNAKER, INC.
Exhibit Index to Quarterly Report on Form 10-QSB
For the Quarter Ended May 31, 1997
EXHIBITS Page No.
EX-27 Financial Data Schedule . . . . . . . . . . 11
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOR THE QUARTER ENDED MAY 31, 1997, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> NOV-30-1997
<PERIOD-END> MAY-31-1997
<CASH> 329
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 329
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 329
<CURRENT-LIABILITIES> 505
<BONDS> 0
0
0
<COMMON> 2,860
<OTHER-SE> (3,036)
<TOTAL-LIABILITY-AND-EQUITY> 329
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,176
<LOSS-PROVISION> (3,176)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,176)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
