SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-KSB/A
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended DECEMBER 31, 1995
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 33-83418-LA
NW VENTURE CORP.
(Name of Small Business Issuer in Its Charter)
Delaware 93-1138967
(State or other jurisdiction I.R.S. Employer
of incorporation or Identification
organization) Number)
501 S.E. Columbia Shores Boulevard, #350
Vancouver, Washington 98661
(Address of principal (Zip Code)
executive offices)
Issuer's telephone number, including area code: (360) 737-6800
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act: None
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 Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-KSB or any amendment to this Form 10-KSB. [ ] N/A
State Issuer's revenues for its most recent fiscal year: None.
As of March 15, 1996, the aggregate market value of the Common Stock held by
non-affiliates of the Issuer (500,000 shares) was approximately $50,000 (based
only upon the offering and sale price of the shares to the public). See Part
II, Item 5 for market information. The number of shares outstanding of the
Common Stock ($.0001 par value) of the Issuer as of the close of business on
March 15, 1995 was 4,500,000.
Documents Incorporated by Reference: None
PART I
Item 1. Description of Business.
Introduction
NW Venture Corp. (the "Company") was organized under the laws of
the State of Delaware on February 24, 1994. Since inception, the
primary activity of the Company has been directed to organizational
efforts and obtaining initial financing. In October 1995, the Company
completed an initial public offering (the "Offering") pursuant to a
Registration Statement declared effective by the Securities and
Exchange Commission on June 30, 1995 and sold 500,000 shares of its
Common Stock, $.0001 par value, at a price of $.10 per share. The
Company is a "blank check" company subject to Rule 419 of Regulation C
under the Securities Act of 1933, as amended, which was organized to
obtain funding from persons purchasing in the Offering in order to
provide a vehicle to take advantage of business opportunities which
management believes arise from time to time.
The Company has entered into negotiations to acquire a business
opportunity but no assurance can be given that an agreement will be
signed or that the transaction will be completed. In connection
therewith, subsequent to the completion of the Offering, the Company
commenced efforts to seek a business opportunity in which to acquire.
In the course of its investigation, the Company was contacted by a
company whose President is the brother of the Company's sole officer
and director. Such company indicated that it was interested in
seeking the perceived advantages of a publicly-held corporation and
requested information from the Company with regard to the recently
completed Offering. In turn, the Company requested and has received
background information on such company including financial
information. As of the date of this report, the parties have begun to
negotiate the structure of the transaction whereby it is intended that
the Company will acquire all of the issued and outstanding shares of
the company in exchange for a controlling interest in the Company.
Except for 10% of the deposited funds (10% of $50,000 or $5,000)
which was released under Rule 419 upon completion of the Offering, the
deposited funds and the securities to be issued to subscribers in the
Offering are remaining in escrow and may not be released until an
acquisition meeting certain specified criteria has been made and a
sufficient number of subscribers reconfirm their investment in
accordance with the procedures set forth in Rule 419.
Plan of Operation
The Company was organized for the purpose of creating a
corporate vehicle to seek, investigate and, if such investigation
warrants, acquire an interest in business opportunities presented to
it by persons or firms who or which desire to employ the Company's
funds in their business or to seek the perceived advantages of a
publicly-held corporation. The Company will not restrict its search
to any specific business, industry or geographical location, and the
Company may participate in a business venture of virtually any kind or
nature. The discussion of the business under this caption is
purposefully general, not meant to be restrictive of the Company's
virtually unlimited discretion to search for and enter into potential
business opportunities and does not take into account that the Company
has already entered into negotiations to acquire a business
opportunity. No assurance can be given however that this transaction
will in fact be consummated.
The proceeds of the Offering will be used generally for the
purpose of identifying, investigating, analyzing and acquiring a
business opportunity. Persons purchasing securities in the Offering
and other shareholders will likely not have the opportunity to
participate in any of these decisions. The Company is referred to as
a "blank check" company because investors will entrust their
investment monies to the Company's management before they have a
chance to analyze any ultimate use to which their money may be put.
Consequently, the Company's potential success is heavily dependent on
the Company's management, which will have virtually unlimited
discretion in searching for and entering into a business opportunity.
Management anticipates that it may be able to participate in only
one potential business venture, due primarily to the Company's limited
financing. This lack of diversification should be considered a
substantial risk in investing in the Company because it will not
permit the Company to offset potential losses from one venture against
gains from another.
The Company may seek a business opportunity in the form of firms
which have recently commenced operations, are developing companies in
need of additional funds for expansion into new products or markets,
are seeking to develop a new product or service, or are established
businesses which may be experiencing financial or operating
difficulties and are in need of additional capital. In some
instances, a business opportunity may involve the acquisition or
merger with a company which does not need substantial additional cash
but which desires to establish a public trading market for its common
stock. A company which seeks the Company's participation in
attempting to consolidate its operations through a merger,
reorganization, asset acquisition, or some other form of combination
may desire to do so to avoid what it may deem to be adverse
consequences of undertaking a public offering itself. Factors
considered may include time delays, significant expense, loss of
voting control and the inability or unwillingness to comply with
various federal and state laws enacted for the protection of
investors.
The Company anticipates that the selection of a business
opportunity in which to participate will be complex and extremely
risky. Because of general economic conditions, rapid technological
advances being made in some industries, and shortages of available
capital, management believes that there are numerous firms seeking
even the limited additional capital which the Company will have and/or
the benefits of a publicly traded corporation. Such perceived
benefits of a publicly traded corporation may include facilities or
improving the terms on which additional equity financing may be
sought, providing liquidity for the principals of a business, creating
a means for providing incentive stock options or similar benefits to
key employees, providing liquidity (subject to restrictions of
applicable statutes) for all shareholders, 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.
The Company has, and will continue to have following the release
of all deposited funds from the Offering, insufficient capital with
which to provide the owners of business opportunities with any
significant cash or other assets. However, management believes the
Company will offer owners of business opportunities the opportunity
to acquire a controlling ownership interest in a public company at
substantially less cost than is required to conduct an initial public
offering. The owners of the business opportunities will, however,
incur significant post-merger or acquisition registration costs in
the event they wish to register a portion of their shares for
subsequent sale. The Company will also incur significant legal and
accounting costs in connection with the acquisition of a business
opportunity including the costs of preparing post-effective
amendments, Form 8-K's, agreements and related reports and documents.
Nevertheless, the sole Officer and Director of the Company has not
conducted market research and is not aware of statistical data which
would support the perceived benefits of a merger or acquisition
transaction for the owners of a business opportunity.
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by
or under the supervision of the sole Officer and Director of the
Company, who is not a professional business analyst. (See
"Management"). Management intends to concentrate on identifying
preliminary prospective business opportunities which may be brought
to its attention through present associations. In analyzing
prospective business opportunities, management will consider such
matters as the available technical, financial, and managerial
resources; working capital and other financial requirements; history
or operation, if any; prospects for the future; nature of present and
expected competition; the quality and experience of management
services which may be available and the depth of that management; the
potential for further research, development, or exploration; specific
risk factors not now foreseeable but which then may be anticipated to
impact the proposed activities of the Company; the potential for
growth or expansion; the potential for profit; the perceived public
recognition or acceptance of products, services, or trades; name
identification; and other relevant factors. The sole Officer and
Director of the Company will meet personally with management and key
personnel of the firm sponsoring the business opportunity as part of
his investigation. To the extent possible, the Company intends to
utilize written reports and personal investigation to evaluate the
above factors.
It may be anticipated that any opportunity in which the Company
participates will present certain risks. Many of these risks cannot
be adequately identified prior to selection of the specific
opportunity, and investors herein must, therefore, depend on the
ability of management to identify and evaluate such risks. In the case
of some of the opportunities available to the Company, it may be
anticipated that the promoters thereof have been unable to develop a
going concern or that such business is in its development stage in
that it has not generated significant revenues from its principal
business activity prior to the Company's participation, and there is
a risk, even after the Company's participation in the activity and the
related expenditure of the Company's funds, that the combined
enterprises will still be unable to become a going concern or advance
beyond the development stage. Many of the opportunities may involve
new and untested products, processes, or market strategies which may
not succeed. Such risks will be assumed by the Company and,
therefore, its shareholders.
The Company will not restrict its search for any specific kind
of firms, but may acquire a venture which is in its preliminary or
development stage, which is already in operation, or in essentially
any stage of its corporate life. It is impossible to predict at this
time the status of any business in which the Company may become
engaged, in that such business may need additional capital, may
merely desire to have its shares publicly traded, or may seek other
perceived advantages which the Company may offer.
Acquisition of Opportunities
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, reorganization, joint venture, or licensing agreement
with another corporation or entity. It may also purchase stock or
assets of an existing business. Investors should note that the
Company has, and will continue to have following the release of all
the deposited funds from the Offering insufficient capital with which
to make any acquisitions. Accordingly, in any of the transactions
alluded to herein, it is likely that the consideration utilized to
make any acquisitions will consist of equity securities. The
Company has structured its capitalization so that it will have
available, upon completion of the Offering, 45,500,000 authorized but
unissued shares of Common Stock.
In the event that an acquisition is made utilizing primarily
equity securities (as is expected to be the case), the percentage
ownership of present shareholders and of shareholders acquiring
securities pursuant to this offering will be diluted, the extent of
dilution depending upon the amount so issued. Persons acquiring
shares in connection with any acquisition of a business may obtain an
amount of equity securities sufficient to control the Company. In
addition, the Company's sole Director may, as part of the terms of the
acquisition transaction, resign and be replaced by new directors
without a vote of the Company's shareholders. Further, if the
Company were to issue substantial additional securities in any
acquisition, such issuance might have an adverse effect on any
trading market that might develop in the Company's securities in the
future.
It is anticipated that any securities issued in any such
reorganization would be issued in reliance on exemptions from
registration under applicable federal and state securities laws. In
some circumstances, however, as a negotiated element of this
transaction, the Company may agree to register such securities either
at the time the transaction is consummated, under certain conditions,
or at specified times thereafter. The issuance of substantial
additional securities and their potential sale into any trading market
which may develop in the Company's securities may have a depressive
effect on such market.
The Company intends to structure a merger or acquisition in such
a manner as to minimize Federal and State tax consequences to the
Company and to any target company. Under Section 368 of the Internal
Revenue Code of 1986, as amended (the "Code"), a statutory merger or
consolidation is an exempt transaction and may be tax-free if effected
in accordance with State law. A tax-free reorganization may
require the Company to issue a substantial number of its
securities in exchange for the securities or assets of a target firm.
Accordingly, the proportional interests of the shareholders of the
Company prior to such transaction or reorganization may be
substantially less than the proportional interest of such
shareholders in the reorganized entity. Even if a merger or
consolidation is undertaken in accordance with the Code, there is no
assurance that Federal and State tax regulations will not change in
the foreseeable future and result in the Company incurring a
significant tax liability.
As part of the Company's investigation, the sole Officer and
Director of the Company will meet personally with management and key
personnel, may visit and inspect material facilities, obtain
independent analysis or verification of certain information provided,
check references of management and key personnel, and take other
reasonable investigative measures, to the extent of the Company's
limited financial resources and management expertise.
The manner in which the Company participates in an opportunity
will depend on the nature of the opportunity, the respective needs and
desires of the Company and other parties, the management of the
opportunity, and the relative negotiating strength of the Company and
such other management.
With respect to any mergers or acquisitions, negotiations with
target company management will be expected to focus on the percentage
of the Company which target company shareholders would acquire in
exchange for their shareholdings in the target company. Depending
upon, among other things, the target company's assets and
liabilities, the Company's shareholders will in all likelihood hold a
lesser percentage ownership interest in the Company following any
merger or acquisition. The percentage ownership may be subject to
significant reduction in the event the Company acquires a target
company with substantial assets. Any merger or acquisition effected
by the Company can be expected to have a significant dilutive effect
on the percentage of shares held by the Company's then-shareholders,
including purchasers in the Offering.
It is not likely that the Company will have sufficient funds
from the proceeds of the Offering to undertake any significant
development, marketing, and manufacturing of any products which may be
acquired. Accordingly, following the acquisition of any such
product, the Company will, in all likelihood, be required to either
seek additional debt or equity financing or obtain funding from third
parties, in exchange for which the Company would probably be required
to give up a substantial portion of its interest in any acquired
products. There is no assurance that the Company will be able either
to obtain additional financing or interest third parties in providing
funding for the further development, marketing, and manufacturing of
any products acquired.
The Company will participate in a business opportunity only
after the negotiation and execution of appropriate written
agreements. Although the terms of such agreements cannot be
predicted, generally such agreements will require specific
representations and warranties by all of the parties thereto, will
specify certain events of default, will detail the terms of closing
and the conditions which must be satisfied by each of the parties
prior to such closing, will outline the manner of bearing costs if
the transaction is not closed, will set forth remedies on default, and
will include miscellaneous other terms.
It is anticipated that the investigation of specific business
opportunities and the negotiation, drafting and execution of relevant
agreements, disclosure documents, and other instruments will require
substantial management time and attention and substantial costs for
accountants, attorneys, and others. If a decision is made not to
participate in a specific business opportunity, the costs theretofore
incurred in the related investigation would not be recoverable.
Furthermore, even if an agreement is reached for the participation in
a specific business opportunity, the failure to consummate that
transaction may result in the loss to the Company of the related costs
incurred.
Further, companies subject to Section 13 or 15(d) of the Exchange
Act must furnish certain information about significant acquisitions,
including certified financial statements for the company or companies
acquired covering one, two or three years, depending upon the relative
size of the acquisitions. In addition, if during the Offering the
Company determines that a material acquisition is probable, the
Company must file a post-effective amendment to the Registration
Statement of which this Prospectus is a part. A post-effective
amendment would include, pursuant to Regulation S-B promulgated under
the Exchange Act, certified financial statements for the company or
companies proposed to be acquired. Such an amendment would not be
declared effective by the Securities and Exchange Commission until the
requisite financial statements are filed. Consequently, if targeted
acquisition prospects do not have, or are unable to obtain, the
requisite certified financial statements, such acquisitions by the
Company would appear to be inappropriate during the Offering and so
long as the reporting requirements of the Exchange Act are applicable.
Rule 419 Prescribed Acquisition Criteria and Reconfirmation
As previously discussed herein, the Company is subject to Rule
419 under the Act. As such, among other things, any agreement to
acquire an acquisition candidate must provide for the acquisition of a
business or assets for which the fair market value of the business or
assets to be acquired represents at least 80% of the maximum offering
proceeds. For purposes of the Offering, the fair market value of the
business or assets to be acquired must be at least $40,000. Once an
acquisition agreement meeting the above criteria has been executed,
the Company must successfully complete a reconfirmation offering.
Rule 419 which was adopted to strengthen the regulation of
securities offerings by "blank check" companies, which Congress has
found to have been common vehicles for fraud and manipulation in the
penny stock market. Rule 419 requires that the securities to be
issued and the funds received in a "blank check" Offering be deposited
and held in escrow account until an acquisition meeting specific
criteria is completed. Before the acquisition can be completed and
before the funds (except for an amount up to 10% of the deposited
funds) and securities can be released, the "blank check" company is
required to update its registration statement with a post-effective
amendment and, after the effective date therefor, the "blank check"
company is required to furnish investors with a prospectus (which
forms a part of the post-effective amendment to its registration
statement) containing specified information, including a discussion of
the business and the audited financial statements of the proposed
acquisition candidate. According to the Rule, the investors must have
no fewer than 20 and no more than 45 business days from the effective
date of the post-effective amendment to decide whether to remain an
investor or require the return of their investment funds. Unless a
sufficient number of investors elect to remain investors, all of the
deposited funds in the escrow account must be returned to all
investors and none of the securities will be issued. Rule 419 further
provides that if the "blank check" company does not complete an
acquisition meeting the specified criteria within 18 months of the
date of the original offering prospectus, all of the deposited funds
must be returned to investors.
Competition
The Company will remain an insignificant participant among the
firms which 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 the Company. In view of the Company's
combined limited financial resources and limited management
availability, the Company will continue to be at a significant
competitive disadvantage compared to the Company's competitors.
Regulation
The Investment Company Act of 1940 defines an "investment
company" as an issuer which is or holds itself out as being engaged
primarily in the business of investing, reinvesting or trading of
securities. Although management believes that the Company will not be
subject to regulation under such Act insofar that the Company does not
intend to engage in such activities, the Company has obtained no
formal determination as to the status of the Company under such Act.
The Company could be expected to incur significant registration and
compliance costs if required to register under the Investment Company
Act of 1940. Accordingly, management will continue to review the
Company's activities from time to time with a view toward reducing the
likelihood the Company could be classified as an "investment company".
Employees
At present, the Company does not employ any persons on a salary
basis. The Company's sole officer devotes such time as is required
for the development stage of the Company. Management of the Company
expects to use attorneys, accountants, and consultants, as necessary,
and does not anticipate a need to engage any full-time employees so
long as it is seeking and evaluating business opportunities. The
need for employees and their availability will be addressed in
connection with the decision whether or not to acquire or participate
in a specific business opportunity.
Item 2. Description of Property.
The Company maintains executive offices pursuant to an oral
agreement on a rent-free, month-to-month basis in office space
provided by its sole officer and director. (See "Management"). The
office is located at 501 S.E. Columbia Shores Boulevard, #350,
Vancouver, Washington 98661. The Company believes these premises are
suitable for its present needs and does not anticipate the need to
identify and lease any other premises.
Item 3. Legal Proceedings.
There are no material pending legal proceedings to which the
Company is a party or to which any of its property is subject.
Item 4. Submission of Matters to a Vote of Security-Holders.
No matter was submitted during the fourth quarter of the fiscal
year covered by this report to a vote of security holders.
PART II
Item 5. Market for Common Equity
and Related Stockholder Matters.
(a) Market Information.
Since inception, there has been no market for the Common Stock of
the Company. Pursuant to Rule 419, the securities to be issued to
subscribers in the Offering are remaining in escrow and may not be
released until an acquisition meeting certain specified criteria has
been made and a sufficient number of subscribers reconfirm their
investment in accordance with the procedures set forth in Rule 419.
Accordingly, until such time, there can be no trading in the Common
Stock and there is no assurance that a market for the Common Stock
will exist after a merger or acquisition is completed by the Company.
The market for the Company's securities upon a merger or acquisition
being concluded may be very restricted and liquidity may be extremely
limited.
(b) Holders.
As of March 15, 1996 there were 13 record holders of the Company's
Common Stock.
(c) Dividends.
At the present time the Company does not anticipate paying
dividends on its Common Stock in the foreseeable future. Any future
dividends will depend on earnings, if any, of the Company, its
financial requirements and other factors.
Item 6. Management's Discussion and Analysis
or Plan of Operation.
The Company is in the development stage and in October 1995
completed an initial public offering (the "Offering") pursuant to a
Registration Statement declared effective by the Securities and
Exchange Commission on June 30, 1995 and sold 500,000 shares of its
common stock, $.0001 par value, at a price of $.10 per share. The
Offering was conducted directly by the Company without the use of a
professional underwriter. The Company is a "blank check" company
subject to Rule 419 of Regulation C which was organized to obtain
funding from persons purchasing in the Offering in order to provide a
vehicle to take advantage of business opportunities which management
believes arise from time to time.
Except for 10% of the deposited funds (10% of $50,000, or $5,000)
which was released under Rule 419 upon completion of the Offering, the
deposited funds and the securities to be issued to subscribers are
remaining in escrow and may not be released until an acquisition
meeting certain specified criteria has been made and a sufficient
number of subscribers reconfirm their investment in accordance with
the procedures set forth in Rule 419.
The Company has entered into negotiations to acquire a business
opportunity but no assurance can be given that an agreement will be
signed or that the transaction will be completed.
The Company had no revenues for each of the years ended December
31, 1995 and December 31, 1994. The Company had a net loss of $(385)
for the year ended December 31, 1995 as compared to a net loss of
$(220) for the year ended December 31, 1994. In addition, at December
31, 1995, the Company had total assets of $47,377 (which amount
includes $45,342 of deposited funds being held in escrow pursuant to
Rule 419) and total liabilities of $4,474.
There can be no assurance that an acquisition can be done which
meets the requirements of Rule 419 of Regulation C under the
Securities Act of 1933, as amended. Rule 419 was adopted to
strengthen the regulation of securities Offerings by "blank check"
companies.
Item 7. Financial Statements.
See pages F-1 through F-7.
Item 8. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
None.
PART III
Item 9. Directors, Executive Officers, Promoters
and Control Persons; Compliance with
Section 16(a) of the Exchange Act.
The Company's sole Director and Executive Officer, his age and
position is as follows:
<TABLE>
<CAPTION>
Name Age Position
<S> <C> <C>
Martin Rifkin 34 President, Secretary, Treasurer
and Director
</TABLE>
The sole officer and director will serve for a term of one year
or until his successors are duly qualified and appointed. There are
no agreements or understandings for Mr. Rifkin to resign at the
request of another person and Mr. Rifkin is not acting on behalf of or
will act at the direction of another person.
MARTIN RIFKIN has been President, Secretary, Treasurer and a
Director of the Company since its inception. Since December 1985,
Mr. Rifkin has been a Director of Nutrition Now Incorporated
("Nutrition Now"), a company which manufactures and markets
nutritional supplements and, since November 1987, he has been its
Secretary and Treasurer and since February 1992, its President. Also,
from August 1988 to February 1992, he was its Vice President. In
addition, Mr. Rifkin has been, since April 1985, Vice President and a
Director of Nova International Films, Inc. ("Nova"), a company which
principally has been engaged in the business of financing and
producing motion pictures. Such company is at the present time
relatively inactive. In addition, Mr. Rifkin has been Treasurer and
Director of Profit Merchandising Corp. ("PMC") since September 1983
and Vice President since June 1985. PMC is engaged in the
distribution of weatherstripping products.
Nutrition Now previously filed reports and other information with
the Commission pursuant to Section 15(d) of the Exchange Act but filed
a Form 15 on September 28, 1990 which suspended its obligation to file
reports with the Commission. Nova is currently subject and files
reports pursuant to Section 15(d) of the Exchange Act. PMC previously
filed under a Regulation A Offering but does not file reports with the
Commission. Such Offering was filed with the Commission on February
17, 1984 and authorized by the Commission to commence as of June 5,
1984.
Mr. Rifkin intends to pursue his other full time employment and
will devote only such time as is necessary to the affairs of the
Company. In this regard, Mr. Rifkin intends to devote only
approximately 10% of his time to the affairs of the Company.
Item 10. Executive Compensation.
The sole officer and director of the Company has received no cash
compensation to date and the Company has no employment agreement with
him.
Except for a finder's fee which may be awarded as set forth
below, the Company's sole officer and director will receive no
compensation for his services; however, he will be reimbursed for
actual expenses incurred in connection with searching out and
investigating merger and acquisition candidates. Compensation may be
paid to outside consultants, if any, for services rendered as the
Board of Directors may from time to time determine. Any such
compensation will be based on actual hours devoted to the Company's
business.
In the event the Company successfully completes the acquisition
of a business opportunity, the Board of Directors may award a
finder's fee to Martin Rifkin if the acquisition is largely due to
his efforts. The amount of this finder's fee will not exceed $2,500.
The Company does not initially intend to pay Directors for
attending Board of Directors Meetings.
Item 11. Security Ownership of Certain Beneficial Owners
and Management.
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock as of March 15,
1996, by (i) each person who is known by the Company to own
beneficially more than 5% of the Company's outstanding Common Stock;
(ii) each of the Company's directors; and (iii) directors and officers
of the Company as a group:
<TABLE>
<CAPTION>
Number Percent
of Shares of
Name and Address Owned Class
<S> <C> <C>
Martin Rifkin* 4,050,000(1) 90.0%
501 S.E. Columbia Shores
Blvd.
#350
Vancouver, WA 98661
All Officers and Directors 4,050,000(1) 90.0%
as a Group (1 Person)
</TABLE>
_________________________
* The above named individual may be deemed a "parent" and
"promoter" of the Company under the rules and regulations of the
Securities Act of 1933 by virtue of his common stock ownership
and his efforts in the organization.
(1) Includes 50,000 shares purchased by Mr. Rifkin in the Offering.
Item 12. Certain Relationships and Related Transactions.
The Company was incorporated on February 24, 1994, under the
laws of the State of Delaware, with an authorized capitalization of
50,000,000 shares of Common Stock, $.0001 par value each. In April
1994, the Company issued 4,000,000 shares to Martin Rifkin for cash
consideration of $1,000.
In April 1994, the Company borrowed $4,000 from Martin Rifkin in
order to pay certain operating expenses of the Company and expenses of
the Offering. Such loans are due on demand and bear interest at 7%
per annum. The Company intends to repay these loans from the proceeds
of the Offering.
See Part I, Item 2 for a description of the office arrangements
between the Company and Mr. Rifkin.
Item 13. Exhibits, List and Reports on Form 8-K.
(a) Exhibits.
3.1 Registrant's certificate of incorporation(1)
3.2 Registrant's by-laws(1)
4.1 Specimen certificate for common stock(1)
4.2 Promissory Note with Martin Rifkin(1)
99.1 Escrow Agreement (form)(1)
___________________
(1) Filed with the Registration Statement on Form SB-2
declared effective as of June 30, 1995.
(b) Reports on Form 8-K.
Listed below are reports on Form 8-K filed during the last
quarter of the period covered by this report:
None.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
NW VENTURE CORP.
(Registrant)
By: /s/ Martin Rifkin
Martin Rifkin, President
Dated: March 29, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the Registrant, and in the capacities and on the dates
indicated:
Signature Title Date
/s/ Martin Rifkin President, Secretary,
Martin Rifkin Treasurer, Director 3/29/96
(Principal Executive
Officer and Principal
Financial Officer)
GLASSER & HAIMS, P.C.
CERTIFIED PUBLIC ACCOUNTANTS
99 WEST HAWTHORNE AVENUE
VALLEY STREAM, N.Y. 11580
ALVIN M. GLASSER, C.P.A. (516) 568-2700
IRWIN M. HAIMS, C.P.A. TELECOPIER
(516) 568-2911
REPORT OF CERTIFIED PUBLIC ACCOUNTANTS
THE BOARD OF DIRECTORS
NW VENTURE CORP.
We have audited the accompanying balance sheets of NW Venture
Corp. (adevelopment stage company) as of December 31, 1995 and
the related statements of operations, stockholder's equity, and
cash flows for the period February 24, 1994 (inception) through
December 31, 1995. 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 audit.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards 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. 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 audit provides 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 NW Venture Corp. (a development stage company) as of December
31, 1995 and the results of its operations and cash flows for the
period indicated above in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed
in Note 2 to the financial statements, the Company completed a
public offering of its securities in October 1995, but the
Company's ability to continue is dependent upon the successful
completion of a reconfirmation offering pursuant to Rule 419 of
regulation C under the Securities Act of 1933, as amended. The
financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
GLASSER & HAIMS, P.C.
Valley Stream, New York
March 4, 1996
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 1995
ASSETS
CURRENT ASSETS
Cash in bank $ 1,727
TOTAL CURRENT ASSETS $ 1,727
OTHER ASSETS
Organization Expenses (Net of Amortization) $ 308
Escrow Account (Note 2) 45,342
TOTAL OTHER ASSETS 45,650
TOTAL ASSETS $ 47,377
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Interest payable $ 474
Loans payable (on demand
with interest at 7%) 4,000
TOTAL CURRENT LIABILITIES $ 4,474
STOCKHOLDERS' EQUITY
Common stock, $.0001 par value, 50,000,000
shares authorized, 4,500,000 shares
issued and outstanding (Note 2) 400
Capital in excess of par value 600
Deficit accumulated during development stage(3,097)
(2,079)
Temporary Capital
500,000 shares issued
and held by escrow agent 50,000
Offering expenses (5,000)
45,000
TOTAL STOCKHOLDERS' EQUITY 42,903
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 47,377
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THESE FINANCIAL STATEMENTS
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE PERIOD
2/24/94
1/1/95 (INCEPTION)
THROUGH THROUGH
12/31/95 12/31/94
REVENUE $ 0 $ 0
EXPENSES 778 292
NET (LOSS) FROM OPERATIONS $ (778) $ (292)
OTHER INCOME:
INTEREST 393 72
NET (LOSS) $ (385) $ (220)
(LOSS) PER SHARE $ (.0001) $ 0
AVERAGE NUMBER OF
SHARES OUTSTANDING 4,125,000 4,000,000
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
THESE FINANCIAL STATEMENTS
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FEBRUARY 24, 1994 (INCEPTION)
THROUGH DECEMBER 31, 1995
CAPITAL
IN
EXCESS OF
SHARES AMOUNT PAR VALUE
Balance,
February 24, 1994 - $ - $ -
Issuance of shares
to Company officers
and directors
for Cash,
April 21, 1994 4,000,000 400 600
Net (Loss) for the
period ended
December 31, 1994
Balance,
Dec. 31, 1994 4,000,000 $ 400 $ 600
Offering Expenses
October 1995
Net (Loss) for
the year ended
December 31, 1995
4,000,000 $ 400 $ 600
TEMPORARY CAPITAL
Issuance of shares
by Public Offering
October 11, 1995 500,000 $ 50 $49,950
Offering Expenses
October 1995
500,000 $ 50 $49,950
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THESE FINANCIAL STATEMENTS
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FEBRUARY 24, 1994 (INCEPTION)
THROUGH DECEMBER 31, 1995
DEFICIT
ACCUMULATED
DURING
DEVELOPMENT
STAGE TOTAL
Balance,
February 24, 1994 $ - $ -
Issuance of shares
to Company officers
and directors
for Cash,
April 21, 1994 1,000
Net (Loss) for the
period ended
December 31, 1994 (220) (220)
Balance,
Dec. 31, 1994 $ (220) $ 780
Offering Expenses
October 1995 (2,492) (2,492)
Net (Loss) for
the year ended
December 31, 1995 (385) (385)
$ (2,097) $ (2,097)
TEMPORARY CAPITAL
Issuance of shares
by Public Offering
October 11, 1995 $ $ 50,000
Offering Expenses
October 1995 (5,000) (5,000)
$ (5,000) $ 45,000
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THESE FINANCIAL STATEMENTS
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOW
INCREASE (DECREASE) IN CASH
FOR THE PERIOD FEBRUARY 24, 1994 (INCEPTION)
THROUGH DECEMBER 31, 1995
FOR THE PERIODS
2/24/94
1/1/95 (INCEPTION)
THROUGH THROUGH
12/31/95 12/31/94
Cash flows from operating
activities: $ (385) $ (220)
Net income
Adjustment to reconcile net income to net
cash provided by operating activities:
Amortization 100 92
Increase in interest payable 280 194
Net cash provided (used) by
operating activities $ (5) $ 66
Cash flows from financing activities:
Payment for organization expenses $ (500)
Payment for offering expenses (5,351) (2,141)
Increase in escrow account (342)
Increase in loans payable 4,000
Proceeds from issuance of
common stock 5,000 1,000
Net cash provided (used) by
financing activities (693) $ 2,359
Net increase (decrease) in cash $ (698) $ 2,425
Cash at beginning of period 2,425 -0-
Cash at end of period $ 1,727 $ 2,425
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART
OF THESE FINANCIAL STATEMENTS
NW VENTURE CORP.
(A DEVELOPMENT STAGE COMPANY)
.
NOTES TO FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNT POLICIES
Organization and Dividend Policy
NW Venture Corp. (the "Company"), was incorporated under the laws
of the State of Delaware on February 24, 1994, and has adopted a
December 31 Fiscal Year. The Company is in the development stage,
has not commenced operations, in October 1995 it completed an
offering of its securities to the public (see Note 2). At the
present time, the Company has not paid any dividends, and any
future dividends will depend on the Company's financial
requirements and other relevant factors.
Earnings Per Share
The computation of earnings per share is based on the weighted
average number of shares outstanding during the period.
Amortization
Organization expenses are being amortized over sixty months.
Amount shown is net of amortization of $192
Income Taxes
There have been no earnings through April 30, 1995 and
accordingly, no provision for Federal income taxes is reflected
in the accompanying financial statements. The Company has a net
operating loss carryover of $605.
NOTE 2: PROPOSED PUBLIC OFFERING OF SECURITIES
Five Hundred Thousand (500,000) shares of Common Stock was
offered at a purchase of $.10 per share. The offering was
completed on October 11, 1995.
The Company is a "blank check" company and therefore is subject
to Rule 419. Accordingly, investors in this offering will receive
the substantive protection provided by Rule 419. Rule 419
requires that the securities to be issued and the funds received
in a "blank check" offering be deposited and held in escrow
account until an acquisition meeting specific criteria is
completed. Before the acquisition can be completed and before
the funds (except for an amount up to 10% of the deposited funds)
and securities can be released, the "blank check" company is
required to update its registration statement with a
post-effective amendment and, after the effective date therefor,
the "blank check" company is required to furnish investors with a
prospectus (which forms a part of the posteffective amendment to
its registration statement) containing specified information,
including a discussion of the business and the audited financial
statements of the proposed acquisition candidate. According to
the Rule, the investors must have no fewer than 20 and no more
than 45 business days from the effective date of the
post-effective amendment to decide whether to remain investors or
require the return of their investment funds. Unless a
sufficient number of investors elect to remain investors, all of
the deposited funds in the escrow account must be returned to all
investors and none of the securities will be issued. Rule 419
further provides that if the "blank check" company does not
complete an acquisition meeting the specified criteria within 18
months of the effective date (June 30, 1995) of the registration
statement relating to the offering, all of the deposited funds
must be returned to investors.
NOTE 3: COMMITMENTS & CONTINGENCIES
a. At present, the Company does not employ any persons on a
salary basis. The Company's sole officer devotes such time as is
required for the development of the Company without compensation.
In the event the Company successfully completes the
acquisition of a business opportunity, the Board of Directors may
award a finder's fee to Martin Rifkin if the acquisition is
largely due to his efforts. The amount of this finder's fee will
not exceed $2,500.
The Company does not initially intend to pay Directors for
attending Board of Directors Meetings.
b. The Company maintains its offices on a rent free,
month-to-month basis in office space provided by its sole officer
and director. The office is located at 501 S.E. Columbia Shores
Boulevard, #350, Vancouver, Washington 98661.
NOTE 4: POTENTIAL CONFLICTS OF INTEREST
The Company's sole officer, director and stockholder is involved
in various business activities. With respect thereto, he is or
may become an officer, director, controlling shareholder and/or
partner of other entities engaged in a variety of business,
similar and dissimilar to the business of the Company, including
other "blank check" companies which may also seek similar
available business opportunities. Because of these affiliations
and because of the minor amount of time devoted to the Company by
the Company's sole officer, director and stockholder, there are
potential conflicts of interest in his acting as an officer and
director of the Company. To the extent the Company's sole
officer, director and stockholder engages in such other
activities, he will have possible conflicts of interest in
directing opportunities to other companies, entities or persons
with which he is or may be associated or have an interest, rather
than direct such opportunities to the Company. Such potential
conflicts of interest include, among other things, time, effort
and corporate opportunity involved in his participation in other
business transactions. Since only limited policies have been
established for the resolution of such a conflict, the Company
may be adversely affected should hechoose to place his other
business interests before those of the Company. No assurance can
be given that such potential conflicts of interest will not cause
the Company to lose potential opportunities. Additional
conflicts of interest and non arm's-length transactions may also
arise in the future in the event the Company's sole officer,
director and stockholder is involved in the management, or is a
stockholder, of any company which the Company may merge with or
acquire or with which the Company may transact business.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM NW VENTURE CORP.'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 1,727
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,727
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 47,377
<CURRENT-LIABILITIES> 4,474
<BONDS> 0
<COMMON> 400
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 47,377
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 778
<LOSS-PROVISION> 778
<INTEREST-EXPENSE> 393
<INCOME-PRETAX> (385)
<INCOME-TAX> 0
<INCOME-CONTINUING> (385)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (385)
<EPS-PRIMARY> (.001)
<EPS-DILUTED> (.001)
</TABLE>
