future being able to satisfy, the minimum asset and other
requirements in order to qualify shares for trading on one of the NASDAQ Markets or a stock exchange (See “Investigation and Selection of Business
Opportunities”). The Company anticipates that the business opportunities presented to it may (i) be recently organized with no operating history,
or a history of losses attributable to under-capitalization or other factors; (ii) be experiencing financial or operating difficulties; (iii) be in
need of funds to develop a new product or service or to expand into a new market; (iv) be relying upon an untested product or marketing concept; or (v)
have a combination of the characteristics mentioned in (i) through (iv). The Company intends to concentrate its acquisition efforts on properties or
businesses that it believes to be undervalued. Given the above factors, investors should expect that any acquisition candidate may have a history of
losses or low profitability.
The Company does not propose to restrict its search for
investment opportunities to any particular geographical area or industry, and may, therefore, engage in essentially any business, to the extent of its
limited resources. This includes industries such as service, finance, natural resources, manufacturing, high technology, product development, medical,
communications and others. The Company’s discretion in the selection of business opportunities is unrestricted, subject to the availability of
such opportunities, economic conditions, and other factors.
Any entity which has an interest in being acquired by, or merging
into the Company, is expected to be an entity that desires to become a public company and establish a public trading market for its securities. In
connection with such a merger or acquisition, it is highly likely that an amount of stock constituting control of the Company would be issued by the
Company or purchased from the current principal shareholders of the Company by the acquiring entity or its affiliates. If stock is purchased from the
current shareholders, the transaction is very likely to result in substantial gains to them relative to their purchase price for such stock. In the
Company’s judgment, none of its officers and directors would thereby become an “underwriter” within the meaning of the Section 2(11) of
the Securities Act of 1933, as amended. The sale of a controlling interest by certain principal shareholders of the Company could occur at a time when
the other shareholders of the Company remain subject to restrictions on the transfer of their shares.
It is anticipated that business opportunities will come to the
Company’s attention from various sources, including its principal shareholders, professional advisors such as attorneys and accountants,
securities broker-dealers, venture capitalists, members of the financial community, and others who may present unsolicited proposals. The Company has
no plans, understandings, agreements, or commitments with any individual for such person to act as a finder of opportunities for the
Company.
The Company does not foresee that it would enter into a merger or
acquisition transaction with any business with which its officers, directors or principal shareholders are currently affiliated. Should the Company
determine in the future, contrary to foregoing expectations, that a transaction with an affiliate would be in the best interests of the Company and its
stockholders, the Company is, in general, permitted by Delaware law to enter into such a transaction if:
1. The material facts as to the relationship or
interest of the affiliate and as to the contract or transaction are disclosed or are known to the Board of Directors, and the Board in good faith
authorizes the contract or transaction by the affirmative vote of a majority of the disinterested directors, even though the disinterested directors
constitute less than a quorum; or
2. The material facts as to the relationship or
interest of the affiliate and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the
contract or transaction is specifically approved in good faith by vote of the stockholders; or
3. The contract or transaction is fair as to the
Company as of the time it is authorized, approved or ratified, by the Board of Directors or the stockholders.
Investigation and Selection of Business
Opportunities
To a large extent, a decision to participate in a specific
business opportunity may be made upon the principal shareholders’ analysis of the quality of the other company’s management and
personnel,
the anticipated acceptability of new products or marketing
concepts, the merit of technological changes, the perceived benefit the Company will derive from becoming a publicly held entity, and numerous other
factors which are difficult, if not impossible, to analyze through the application of any objective criteria. In many instances, it is anticipated that
the historical operations of a specific business opportunity may not necessarily be indicative of the potential for the future because of the possible
need to access capital, shift marketing approaches substantially, expand significantly, change product emphasis, change or substantially augment
management, or make other changes. The Company will be dependent upon the owners of a business opportunity to identify any such problems which may
exist and to implement, or be primarily responsible for the implementation of, required changes. Because the Company may participate in a business
opportunity with a newly organized firm or with a firm which is entering a new phase of growth, it should be emphasized that the Company will incur
further risks, because management in many instances will not have proved its abilities or effectiveness, the eventual market for such company’s
products or services will likely not be established, and such company may not be profitable when acquired.
It is anticipated that the Company will not be able to diversify,
but will essentially be limited to one such venture because of the Company’s limited financial resources. This lack of diversification will not
permit the Company to offset potential losses from one business opportunity against profits from another, and should be considered an adverse factor
affecting any decision to purchase the Company’s securities.
It is emphasized that the Company may affect transactions having
a potentially adverse impact upon the Company’s shareholders pursuant to the authority and discretion of the Company’s management and board
of directors to complete acquisitions without submitting any proposal to the stockholders for their consideration. Holders of the Company’s
securities should not anticipate that the Company will necessarily furnish such holders, prior to any merger or acquisition, with financial statements,
or any other documentation, concerning a target company or its business. In some instances, however, the proposed participation in a business
opportunity may be submitted to the stockholders for their consideration, either voluntarily by such directors to seek the stockholders’ advice
and consent or because state law so requires.
The analysis of business opportunities will be undertaken by or
under the supervision of the Company’s principal shareholders, who are not professional business analysts. Although there are no current plans to
do so, the Company might hire outside consultants to assist in the investigation and selection of business opportunities, and might pay a finder’s
fee. Since the Company has no current plans to use any outside consultants or advisors to assist in the investigation and selection of business
opportunities, no policies have been adopted regarding use of such consultants or advisors, the criteria to be used in selecting such consultants or
advisors, the services to be provided, the term of service, or regarding the total amount of fees that may be paid. However, because of the limited
resources of the Company, it is likely that any such fees the Company agrees to pay would be paid in stock and not in cash. Otherwise, the Company
anticipates that it will consider, among other things, the following factors:
1. Potential for growth and profitability, indicated
by new technology, anticipated market expansion, or new products;
2. The Company’s perception of how any particular
business opportunity will be received by the investment community and by the Company’s stockholders;
3. Whether, following the business combination, the
financial condition of the business opportunity would be, or would have a significant prospect in the foreseeable future of becoming sufficient to
enable the securities of the Company to qualify for listing on an exchange or on a national automated securities quotation system, such as NASDAQ, so
as to permit the trading of such securities to be exempt from the requirements of Rule 15c2-6 adopted by the Securities and Exchange
Commission.
4. Capital requirements and anticipated availability
of required funds, to be provided by the Company or from operations, through the sale of additional securities, through joint ventures or similar
arrangements, or from other sources;
5. The extent to which the business opportunity can be
advanced;
6. Competitive position as compared to other companies
of similar size and experience within the industry segment as well as within the industry as a whole;
7. Strength and diversity of existing management, or
management prospects that are scheduled for recruitment;
8. The cost of participation by the Company as
compared to the perceived tangible and intangible values and potential; and
9. The accessibility of required management expertise,
personnel, raw materials, services, professional assistance, and other required items.
In regard to the possibility that the shares of the Company would
qualify for listing on one of the NASDAQ Markets, the current standards include the requirements that the issuer of the securities satisfy, among other
requirements, certain minimum levels of shareholder equity, market value or net income. Many of the business opportunities that might be potential
candidates for a combination with the Company would not satisfy any of the NASDAQ Market listing criteria.
Not one of the factors described above will be controlling in the
selection of a business opportunity, and the Company will attempt to analyze all factors appropriate to each opportunity and make a determination based
upon reasonable investigative measures and available data. 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 difficult and
complex. Potential investors must recognize that, because of the Company’s limited capital available for investigation, the Company may not
discover or adequately evaluate adverse facts about the opportunity to be acquired.
The Company is unable to predict when it may participate in a
business opportunity. Prior to making a decision to participate in a business opportunity, the Company will generally request that it be provided with
written materials regarding the business opportunity containing such items as a description of products, services and company history; management
resumes; financial information; available projections, with related assumptions upon which they are based; an explanation of proprietary products and
services; evidence of existing patents, trademarks, or services marks, or rights thereto; present and proposed forms of compensation to management; a
description of transactions between such company and its affiliates during relevant periods; a description of present and required facilities; an
analysis of risks and competitive conditions; a financial plan of operation and estimated capital requirements; audited financial statements, or if
they are not available, unaudited financial statements, together with reasonable assurances that audited financial statements would be able to be
produced within a reasonable period of time following completion of a merger transaction; and other information deemed relevant.
As part of the Company’s investigation, the Company’s
principal shareholders may 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.
It is possible that the range of business opportunities that
might be available for consideration by the Company could be limited by the impact of Securities and Exchange Commission regulations regarding purchase
and sale of “penny stocks.” The regulations would affect, and possibly impair, any market that might develop in the Company’s securities
until such time as they qualify for listing on NASDAQ or on another exchange which would make them exempt from applicability of the “penny
stock” regulations.
The Company believes that various types of potential merger or
acquisition candidates might find a business combination with the Company to be attractive. These include acquisition candidates
desiring to create a public market for their shares in order
to enhance liquidity for current shareholders, acquisition candidates which have long-term plans for raising capital through the public sale of
securities and believe that the possible prior existence of a public market for their securities would be beneficial, and acquisition candidates which
plan to acquire additional assets through issuance of securities rather than for cash, and believe that the possibility of development of a public
market for their securities will be of assistance in that process. Acquisition candidates who have a need for an immediate cash infusion are not likely
to find a potential business combination with the Company to be an attractive alternative.
There are no loan arrangements or arrangements for any financing
whatsoever relating to any business opportunities currently available.
Form of Acquisition
It is impossible to predict the manner in which the Company may
participate in a business opportunity. Specific business opportunities will be reviewed as well as the respective needs and desires of the Company and
the promoters of the opportunity and, upon the basis of that review and the relative negotiating strength of the Company and such promoters, the legal
structure or method deemed by management to be suitable will be selected. Such structure may include, but is not limited to leases, purchase and sale
agreements, licenses, joint ventures and other contractual arrangements. The Company may act directly or indirectly through an interest in a
partnership, corporation or other form of organization. Implementing such structure may require the merger, consolidation or reorganization of the
Company with other corporations or forms of business organization, and although it is likely, there is no assurance that the Company would be the
surviving entity. In addition, the present management, board of directors and stockholders of the Company most likely will not have control of a
majority of the voting shares of the Company following a reorganization transaction. As part of such a transaction, the Company’s existing
management and directors may resign and new management and directors may be appointed without any vote by stockholders.
It is likely that the Company will acquire its participation in a
business opportunity through the issuance of Common Stock or other securities of the Company. Although the terms of any such transaction cannot be
predicted, it should be noted that in certain circumstances the criteria for determining whether or not an acquisition is a so-called “tax
free” reorganization under the Internal Revenue Code of 1986, depends upon the issuance to the stockholders of the acquired company of a
controlling interest (i.e. 80% or more) of the common stock of the combined entities immediately following the reorganization. If a transaction were
structured to take advantage of these provisions rather than other “tax free” provisions provided under the Internal Revenue Code, the
Company’s current stockholders would retain in the aggregate 20% or less of the total issued and outstanding shares. This could result in
substantial additional dilution in the equity of those who were stockholders of the Company prior to such reorganization. Any such issuance of
additional shares might also be done simultaneously with a sale or transfer of shares representing a controlling interest in the Company by the
principal shareholders.
It is anticipated that any new securities issued in any
reorganization would be issued in reliance upon exemptions, if any are available, from registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of the transaction, the Company may agree to register such securities either at the time the
transaction is consummated, or under certain conditions or at specified times thereafter. The issuance of substantial additional securities and their
potential sale into any trading market that might develop in the Company’s securities may have a depressive effect upon such
market.
The Company will participate in a business opportunity only after
the negotiation and execution of a written agreement. Although the terms of such agreement cannot be predicted, generally such an agreement would
require specific representations and warranties by all of the parties thereto, specify certain events of default, detail the terms of closing and the
conditions which must be satisfied by each of the parties thereto prior to such closing, outline the manner of bearing costs if the transaction is not
closed, set forth remedies upon default, and include miscellaneous other terms normally found in an agreement of that type.
As a general matter, the Company anticipates that it, and/or its
officers and principal shareholders will enter into a letter of intent with the management, principals or owners of a prospective business opportunity
prior to signing a binding agreement. Such letter of intent will set forth the terms of the proposed acquisition but will generally not bind any of the
parties to consummate the transaction. Execution of a letter of intent will by no means indicate that consummation of an acquisition is probable.
Neither the Company nor any of the other parties to the letter of intent will be bound to consummate the acquisition unless and until a definitive
agreement concerning the acquisition as described in the preceding paragraph is executed. Even after a definitive agreement is executed, it is possible
that the acquisition would not be consummated should any party elect to exercise any right provided in the agreement to terminate it on specified
grounds.
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
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 might not be recoverable. Moreover, because many providers of goods and services require compensation at the time
or soon after the goods and services are provided, the inability of the Company to pay until an indeterminate future time may make it impossible to
procure such goods and services.
In all probability, upon completion of an acquisition or merger,
there will be a change in control through issuance of substantially more shares of common stock. Further, in conjunction with an acquisition or merger,
it is likely that the principal shareholders may offer to sell a controlling interest at a price not relative to or reflective of a price which could
be achieved by individual shareholders at the time.
Investment Company Act and Other
Regulation
The Company may participate in a business opportunity by
purchasing, trading or selling the securities of such business. The Company does not, however, intend to engage primarily in such activities.
Specifically, the Company intends to conduct its activities so as to avoid being classified as an “investment company” under the Investment
Company Act of 1940 (the “Investment Act”), and therefore to avoid application of the costly and restrictive registration and other
provisions of the Investment Act, and the regulations promulgated thereunder.
Section 3(a) of the Investment Act contains the definition of an
“investment company,” and it excludes any entity that does not engage primarily in the business of investing, reinvesting or trading in
securities, or that does not engage in the business of investing, owning, holding or trading “investment securities” (defined as “all
securities other than government securities or securities of majority-owned subsidiaries”) the value of which exceeds 40% of the value of its
total assets (excluding government securities, cash or cash items). The Company intends to implement its business plan in a manner which will result in
the availability of this exception from the definition of “investment company.” Consequently, the Company’s participation in a business
or opportunity through the purchase and sale of investment securities will be limited.
The Company’s plan of business may involve changes in its
capital structure, management, control and business, especially if it consummates a reorganization as discussed above. Each of these areas is regulated
by the Investment Act, in order to protect purchasers of investment company securities. Since the Company will not register as an investment company,
stockholders will not be afforded these protections.
Any securities which the Company might acquire in exchange for
its Common Stock are expected to be “restricted securities” within the meaning of the Securities Act of 1933, as amended (the
“Act”). If the Company elects to resell such securities, such sale cannot proceed unless a registration statement has been declared effective
by the U. S. Securities and Exchange Commission or an exemption from registration is available. Section 4(1) of the Act, which exempts sales of
securities not involving a distribution, would in all likelihood be available to permit a private sale. Although the plan of operation does not
contemplate resale of securities acquired, if such a sale were to be
necessary, the Company would be required to comply with the
provisions of the Act to affect such resale.
An acquisition made by the Company may be in an industry which is
regulated or licensed by federal, state or local authorities. Compliance with such regulations can be expected to be a time-consuming and expensive
process.
Competition
The Company expects to encounter substantial competition in its
efforts to locate attractive opportunities, primarily from business development companies, venture capital partnerships and corporations, venture
capital affiliates of large industrial and financial companies, small investment companies, and wealthy individuals. Many of these entities will have
significantly greater experience, resources and managerial capabilities than the Company and will therefore be in a better position than the Company to
obtain access to attractive business opportunities.
Employees
As of December 31, 2013, the Company had no
employees.
ITEM 1A. RISK
FACTORS
Smaller reporting companies are not required to provide the
information required by this item.
ITEM 1B. UNRESOLVED STAFF
COMMENTS
None.
ITEM
2. PROPERTIES.
As of December 31, 2013, the Company did not own or lease any
properties.
ITEM 3. LEGAL
PROCEEDINGS
As of December 31, 2013, the Company was not a party to any
pending or threatened legal proceedings.
ITEM 4. MINE SAFETY
DISCLOSURES
Not applicable.
PART II.
ITEM 5. MARKET FOR
REGISTRANT’S COMMON EQUITY; RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES
Market for Registrant’s Common
Equity
The Company became subject to Securities Exchange Act Reporting
Requirements in October 2006. The symbol “YTFD” is assigned for our securities. There has never been any market for or trading in our stock.
There can be no assurance that a highly-liquid market for our securities will ever develop.
Options and Warrants
None of the shares of our common stock are subject to outstanding
options or warrants.
Notes Payable — Related Party
At December 31, 2013, the Company had loans and notes outstanding
from a related party in the aggregate amount of $354,131 plus accrued interest of approximately $63,300, which represents amounts loaned to the Company
to pay the Company’s expenses of operation. On December 31, 2013, the Payee under the Note and the Company agreed that the Due Date of the Note
would be extended to December 31, 2014.
Status of Outstanding Common Stock
As of December 31, 2013, we had a total of 5,199,000 shares of
our common stock outstanding. Of these shares, 5,120,000 are held by “affiliates” of the Company and the remaining shares are either
registered or may be transferred subject to the requirements of Rule 144. We have not agreed to register any additional outstanding shares of our
common stock under the Securities Act.
Holders
We have issued an aggregate of 5,199,000 shares of our common
stock to approximately 50 record holders.
Dividends
We have not paid any dividends to date, and have no plans to do
so in the immediate future.
Recent Sales of Unregistered Securities
None.
Purchases of Equity Securities
The Company has never purchased nor does it own any equity
securities of any other issuer.
ITEM 6. SELECTED FINANCIAL
DATA
Year Ended
|
|
|
|
12/31/13
|
|
12/31/12
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
$ |
(77,193 |
) |
|
$ |
(75,000 |
) |
Net Loss Per Share, Basic and Diluted |
|
|
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
Weighted Average No. Shares,
Basic and Diluted |
|
|
|
|
5,199,000 |
|
|
|
5,199,000 |
|
|
|
|
|
$ |
(419,875 |
) |
|
$ |
(342,682 |
) |
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
$ |
419,875 |
|
|
$ |
342,682 |
|
ITEM
7. |
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION |
Overview
Yacht Finders, Inc. (the “Company”) was incorporated in
Delaware on August 15, 2000 as Sneeoosh Corporation. On October 20, 2000 the company filed an amended Certificate of Incorporation to change the name
to Snohomish Corporation. On April 15, 2003 the company filed a subsequent amendment to change the name to Yacht Finders, Inc. Yacht Finder’s Inc.
business plan was to create an online database for public buyers and yacht brokers to interface immediately with each other while capturing the
benefits of targeting a larger market. On November 6, 2007, the Company discontinued its prior business and changed its business plan. The
Company’s business plan now consists of exploring potential targets for a business combination through the purchase of assets, share purchase or
exchange, merger or similar type of transaction
The Company’s current business plan is to seek, investigate,
and, if warranted, acquire one or more properties or businesses, and to pursue other related activities intended to enhance shareholder value. The
acquisition of a business opportunity may be made by purchase, merger, exchange of stock, or otherwise, and may encompass assets or a business entity,
such as a corporation, joint venture, or partnership.
Results of Operations
Liquidity and Capital Resources
As of December 31, 2013, we had no assets, a working capital
deficit of $419,875 and an accumulated stockholders’ deficit of $419,875. Our operating activities used $62,135 in cash for the fiscal year period
ended December 31, 2013, while our operations used $61,863 cash in the fiscal year ended December 31, 2012. We earned $0.00 in revenue during the
fiscal year ended December 31, 2013.
Management believes that the Company will require a cash infusion
of at least $50,000 for the next twelve months. Historically, we have depended on loans from our principal shareholders and their affiliated companies
(to provide us with working capital as required. There is no guarantee that such funding will be available when required and there can be no assurance
that our stockholders, or any of them, will continue making loans or advances to us in the future.
At December 31, 2013, the Company had loans and notes outstanding
from a shareholder in the aggregate amount of $354,131, which represents amounts loaned to the Company to pay the Company’s expenses of operation.
On December 31, 2013, the Payee under the Note and the Company agreed that the Due Date of the Note would be extended to December 31,
2014.
Twelve Months Ended December 31, 2013 Compared to December
31, 2012
The following table summarizes the results of our operations
during the fiscal years ended December 31, 2013 and 2012, respectively, and provides information regarding the dollar and percentage increase or
(decrease) from the current 12-month period to the prior 12-month period:
| Line Item |
12/31/13 |
12/31/12 |
Increase
(Decrease) |
Percentage
Increase
(Decrease) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per share of common stock |
|
|
|
|
We recorded a net loss of $77,193 for the fiscal year ended
December 31, 2013 as compared with a net loss of $75,000 for the fiscal year ended December 31, 2012.
Off Balance Sheet Arrangements
We do not have any off balance sheet arrangements that have or
are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of
operations, liquidity or capital expenditures or capital resources that is material to an investor in our securities.
Seasonality
Our operating results are not affected by
seasonality.
Inflation
Our business and operating results are not affected in any
material way by inflation.
Critical Accounting Policies
The Securities and Exchange Commission issued Financial Reporting
Release No. 60, “Cautionary Advice Regarding Disclosure About Critical Accounting Policies” suggesting that companies provide additional
disclosure and commentary on their most critical accounting policies. In Financial Reporting Release No. 60, the Securities and Exchange Commission has
defined the most critical accounting policies as the ones that are most important to the portrayal of a company’s financial condition and
operating results, and require management to make its most difficult and subjective judgments, often as a result of the need to make estimates of
matters that are inherently uncertain. The nature of our business generally does not call for the preparation or use of estimates. Due to the fact that
the Company does not have any operating business, we do not believe that we do not have any such critical accounting policies.
ITEM 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
As a “smaller reporting company” as defined by Item 10
of Regulation S-K, the Company is not required to provide information required by this Item.
ITEM 8. FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA
Set forth below are the audited financial statements for the
Company for the fiscal years ended December 31, 2013 and 2012 and the period from April 15, 2003 (inception) through December 31, 2013 and the reports
thereon of Paritz & Co., P.A.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The Board of Directors and Shareholders
Yacht Finders,
Inc.:
We have audited the accompanying balance sheet of Yacht
Finders, Inc. (a development stage company) as of December 31, 2013 and 2012, and the related statements of operations, changes in shareholders’
equity (deficit), and cash flows for the years ended December 31, 2013 and 2012, and from April 15, 2003 (inception) through December 31, 2013. 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.
We conducted our audits in accordance with the standards of
the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to
perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. 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, as well as evaluating the overall financial statement presentation. We believe that our audits provide 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 Yacht Finders, Inc. as of December 31, 2013 and 2012, and the results of its
operations and its cash flows for the years ended December 31, 2013 and 2012, and from April 15, 2003 (inception) through December 31, 2013 in
conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has incurred operating
losses since inception and has a stockholders’ deficit at December 31, 2013, which raises substantial doubt about its ability to continue as a
going concern. Management’s plan in regard to these matters is also discussed in Note 1. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
Paritz & Co., P.A.
Hackensack, NJ
March
15, 2014
YACHT FINDERS, INC.
(A Development Stage Company)
BALANCE SHEETS
|
|
|
|
December 31,
2013
|
|
|
December 31,
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES & STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,391 |
|
|
|
— |
|
Accrued interest-related party |
|
|
|
|
63,353 |
|
|
|
44,021 |
|
Note payable—related party |
|
|
|
|
354,131 |
|
|
|
298,661 |
|
| |
Total current liabilities and total liabilities |
|
|
|
|
419,875 |
|
|
|
342,682 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, par value $0.001, 20,000,000 shares authorized, no shares issued and outstanding at December 31, 2013 and December 31, 2012,
respectively |
|
|
|
|
— |
|
|
|
— |
|
Common stock, par value $0.001, 80,000,000 shares authorized, 5,199,000 shares issued and outstanding at December 31, 2013 and December 31,
2012, respectively |
|
|
|
|
520 |
|
|
|
520 |
|
Additional paid-in capital |
|
|
|
|
49,280 |
|
|
|
49,280 |
|
Deficit accumulated during the development stage |
|
|
|
|
(469,675 |
) |
|
|
(392,482 |
) |
| |
Total stockholders’ deficit |
|
|
|
|
(419,875 |
) |
|
|
(342,682 |
) |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
|
|
$ |
— |
|
|
$ |
— |
|
See accompanying notes to financial
statements
YACHT FINDERS, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
|
|
|
|
YEAR ENDED DECEMBER 31,
|
|
|
FROM INCEPTION
(APRIL 15, 2003)
TO |
|
|
|
|
|
2013
|
|
|
2012
|
|
|
DEC. 31, 2013
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
5,400 |
|
General and administrative |
|
|
|
|
17,861 |
|
|
|
19,323 |
|
|
|
150,921 |
|
Management Fees—related party |
|
|
|
|
40,000 |
|
|
|
40,000 |
|
|
|
250,000 |
|
|
|
|
|
|
57,861 |
|
|
|
59,323 |
|
|
|
406,321 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense — related party |
|
|
|
|
19,332 |
|
|
|
15,677 |
|
|
|
63,353 |
|
| |
|
|
|
|
$ |
(77,193 |
) |
|
$ |
(75,000 |
) |
|
$ |
(469,674 |
) |
| |
BASIC AND DILUTED LOSS PER COMMON SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
WEIGHTED AVERAGE NUMBER OF |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHARES OUTSTANDING—BASIC AND DILUTED |
|
|
|
|
5,199,000 |
|
|
|
5,199,000 |
|
|
|
|
|
See accompanying notes to financial
statements
YACHT FINDERS, INC.
(A Development Stage Company)
Statement of Changes in Shareholders’ Equity (Deficit)
|
|
|
|
Common Stock
|
|
|
Additional |
|
Deficit
Accumulated
During |
|
|
|
|
Shares
|
|
Par
Value
|
|
|
Paid-In
Capital
|
|
Development
Stage
|
|
|
Total
|
Balance at April 15, 2003 (inception) |
|
|
|
|
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 2003, common stock sold to an officer ($.0001/share) |
|
|
|
|
5,000,000 |
|
|
|
500 |
|
|
|
— |
|
|
|
|
|
July through September 2003, common stock sold through a private offering ($.10/share) |
|
|
|
|
139,000 |
|
|
|
14 |
|
|
|
13,886 |
|
|
|
|
|
Office space contributed by an officer |
|
|
|
|
— |
|
|
|
— |
|
|
|
900 |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2003 |
|
|
|
|
5,139,000 |
|
|
|
514 |
|
|
|
14,786 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office space contributed by an officer |
|
|
|
|
— |
|
|
|
— |
|
|
|
1,200 |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2004 |
|
|
|
|
5,139,000 |
|
|
|
514 |
|
|
|
15,986 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office space contributed by an officer |
|
|
|
|
— |
|
|
|
— |
|
|
|
1,200 |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2005 |
|
|
|
|
5,139,000 |
|
|
|
514 |
|
|
|
17,186 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 2006, common stock sold in private offering ($.50/share) |
|
|
|
|
40,000 |
|
|
|
4 |
|
|
|
19,996 |
|
|
|
|
|
Office space contributed by an officer |
|
|
|
|
— |
|
|
|
— |
|
|
|
1,200 |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2006 |
|
|
|
|
5,179,000 |
|
|
|
518 |
|
|
|
38,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 2007, common stock sold pursuant to SB-2 registered offering at $.50 per share |
|
|
|
|
20,000 |
|
|
|
2 |
|
|
|
9,998 |
|
|
|
|
|
Office space contributed by an officer |
|
|
|
|
— |
|
|
|
— |
|
|
|
900 |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2007 |
|
|
|
|
5,199,000 |
|
|
|
520 |
|
|
|
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2008 |
|
|
|
|
5,199,000 |
|
|
|
520 |
|
|
|
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2009 |
|
|
|
|
5,199,000 |
|
|
$ |
520 |
|
|
$ |
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2010 |
|
|
|
|
5,199,000 |
|
|
$ |
520 |
|
|
$ |
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2011 |
|
|
|
|
5,199,000 |
|
|
$ |
520 |
|
|
$ |
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2012 |
|
|
|
|
5,199,000 |
|
|
$ |
520 |
|
|
$ |
49,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2013 |
|
|
|
|
5,199,000 |
|
|
$ |
520 |
|
|
$ |
49,280 |
|
|
|
|
|
See accompanying notes to financial
statements
YACHT FINDERS, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
|
|
|
|
YEAR ENDED DEC. 31
|
|
FROM INCEPTION
(APRIL 15, 2003)
TO |
|
|
|
|
|
2013
|
|
2012
|
|
DEC. 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(77,363 |
) |
|
$ |
(75,000 |
) |
|
$ |
(469,674 |
) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office space contribution |
|
|
|
|
— |
|
|
|
— |
|
|
|
5,400 |
|
Loss on website development fees |
|
|
|
|
— |
|
|
|
— |
|
|
|
2,500 |
|
|
|
|
|
|
17,330 |
|
|
|
16,677 |
|
|
|
63,353 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,102 |
) |
|
|
(2,540 |
) |
|
|
2,391 |
|
NET CASH USED IN OPERATING ACTIVITIES |
|
|
|
|
(62,135 |
) |
|
|
(61,863 |
) |
|
|
(396,030 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments for website development |
|
|
|
|
— |
|
|
|
— |
|
|
|
(2,500 |
) |
NET CASH USED IN INVESTING ACTIVITIES |
|
|
|
|
— |
|
|
|
— |
|
|
|
(2,500 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from note payable-related party |
|
|
|
|
62,135 |
|
|
|
61,863 |
|
|
|
354,130 |
|
Common stock issued for cash |
|
|
|
|
— |
|
|
|
— |
|
|
|
44,400 |
|
NET CASH PROVIDED BY FINANCING ACTIVITIES |
|
|
|
|
62,135 |
|
|
|
61,863 |
|
|
|
398,530 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCREASE (DECREASE) IN CASH |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH — BEGINNING OF PERIOD |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
See accompanying notes to financial
statements
YACHT FINDERS, INC.
(A Development Stage Company)
Notes to Financial Statements
(1) SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
ORGANIZATION AND BASIS OF PRESENTATION
Yacht Finders, Inc. (the “Company”) was incorporated in
Delaware on August 15, 2000 as Sneeoosh Corporation. On October 20, 2000 the company filed an amended Certificate of Incorporation to change the name
to Snohomish Corporation. The Company did not conduct any operations until April 15, 2003, the date the Company entered the development stage. On April
15, 2003 the company filed a subsequent amendment to change the name to Yacht Finders, Inc. Yacht Finder’s Inc. business plan was to create an
online database for public buyers and yacht brokers to interface immediately with each other while capturing the benefits of targeting a larger market.
On November 6, 2007, while still in the development stage, the Company discontinued its business plan.. The Company’s business plan now consists
of exploring potential targets for a business combination through the purchase of assets, share purchase or exchange, merger or similar type of
transaction. The Company is a development stage enterprise in accordance with Accounting Standards Codification (“ASC”) Topic
915.
USE OF 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 the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates.
REVENUE RECOGNITION
The Company has not recognized any revenues from its
operations
CASH AND CASH EQUIVALENTS
The Company had $-0- cash and no cash equivalents at December 31,
2013 and December 31, 2012. The Company considers all highly liquid securities with original maturities of three months or less when acquired to be
cash equivalents.
LOSS PER COMMON SHARE
The Company reports loss per share using a dual presentation of
basic and diluted loss per share. Basic loss per share excludes the impact of common stock equivalents and is determined by dividing income available
to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share reflects the potential
dilution that could occur if securities and other contracts to issue common stock were exercised or converted into common stock. At December 31, 2013
and December 31, 2012, there were no variances between the basic and diluted loss per share as there were no potentially dilutive securities
outstanding.
INCOME TAXES
The Company accounts for income taxes under the provisions of
Accounting Standards Codification (“ASC”) ASC-740 “Accounting for Income Taxes”. ASC-740 requires recognition of deferred tax
liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under
this
YACHT FINDERS, INC.
(A Development Stage Company)
Notes to Financial Statements
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CON’T)
method, deferred tax liabilities and assets are determined based
on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the
differences are expected to reverse.
In addition ASC-740 seeks to reduce the diversity in practice
associated with certain aspects of the recognition and measurement related to accounting for income taxes and has analyzed filing positions in all of
the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. The Company
has identified its federal tax return and its state tax return in California as “major” tax jurisdictions, as defined. The Company believes
that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material
adverse effect on the Company’s financial condition, results of operations, or cash flow. Therefore, no reserves for uncertain income tax
positions have been recorded pursuant to ASC-740.
WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any
additional shares of common or preferred stock.
GOING CONCERN
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. The Company generated net losses of $469,674 during the period of April 15, 2003 (inception) to
December 31, 2013. As of December 31, 2013, the Company has an accumulated deficit of $469,675 and a working capital deficit of $419,875. This
condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern
is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The
financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company’s continuation as a going
concern is dependent upon working capital advances provided by the Company’s majority shareholder. There is no assurance that the working capital
advances will continue in the future nor that Company will be successful in raising additional funds through other sources.
FAIR VALUE MEASUREMENTS
The Company adopted the provisions of ASC Topic 820, “Fair
Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring
fair value and expands disclosure of fair value measurements.
The estimated fair value of certain financial instruments,
including cash and cash equivalents, payables to related parties, and accounts payable and accrued expenses are carried at historical
YACHT FINDERS, INC.
(A Development Stage Company)
Notes to Financial Statements
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CON’T)
cost basis, which approximates their fair values because of the
short-term nature of these instruments.
ASC 820 defines fair value as the exchange price that would be
received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an
orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to
maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs
that may be used to measure fair value:
Level 1 — quoted prices in active markets for identical
assets or liabilities
Level 2 — quoted prices for similar assets and liabilities
in active markets or inputs that are observable
Level 3 — inputs that are unobservable (for example cash
flow modeling inputs based on assumptions)
RECENT ACCOUNTING PRONOUNCEMENTS
From time to time, new accounting pronouncements are issued by
the Financial Accounting Standards Board or other standard setting bodies that may have an impact on the Company’s accounting and reporting. The
Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future
either will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of
operations, and cash flows when implemented.
(2) SHAREHOLDERS’ EQUITY
The stockholders’ equity section of the Company contains the
following classes of capital stock as of December 31, 2013:
|
* |
Preferred stock, $0.0001 par value: 20,000,000 shares authorized;
-0- shares issued and outstanding. |
| |
|
|
|
* |
Common stock, $0.0001 par value: 80,000,000 shares authorized;
5,199,000 shares issued and outstanding. |
(3) RELATED PARTY TRANSACTIONS
At December 31, 2013, the Company had loans and notes outstanding
from a shareholder in the aggregate amount of $354,131, plus accrued interest of approximately $63,300, which represents amounts loaned to the Company
to pay the Company’s expenses of operation. On December 31, 2013, the Payee under the Note and the Company agreed that the Due Date of the Note
would be extended to December 31, 2014.
YACHT FINDERS, INC.
(A Development Stage Company)
Notes to Financial Statements
(3) RELATED PARTY TRANSACTIONS
(CON’T)
The following table details related party debt on a year-by-year
basis and since inception:
| |
As of 12/31/2013 |
As of 12/31/2012 |
Inception to
12/31/2013 |
|
|
|
|
|
|
|
|
In October 2007, the Company entered into a Services Agreement
with Fountainhead Capital Management Limited (“FHM”), a shareholder who owns 83.68% of the issued and outstanding shares of common stock of
the Company. The initial term of the Services Agreement is one year and the term extends automatically on a year-to-year basis until terminated by
mutual agreement of the parties. The Company is obligated to pay FHM a quarterly fee in the amount of $10,000, in cash or in kind, on the first day of
each calendar quarter commencing October 1, 2007.
The following table details related party management fees on a
year-by-year basis and since inception:
| |
Period ended
12/31/2013 |
Period ended
12/31/2012 |
Inception to
12/31/2013 |
|
|
|
|
(4) INCOME TAXES
The Company adopted Financial Accounting ASC 740 “Income
Taxes”, by defining the confidence level that a tax position must meet in order to be recognized in the financial statements. The Interpretation
requires that the tax effects of a position be recognized only if it is “more-likely-than-not” to be sustained based solely on its technical
merits as of the reporting date. The more-likely-than-not threshold represents a positive assertion by management that a company is entitled to the
economic benefits of a tax position. If a tax position is not considered more-likely-than-not to be sustained based solely on its technical merits no
benefits of the tax position are to be recognized. Moreover, the more-likely-than-not threshold must continue to be met in each reporting period to
support continued recognition of a benefit. With the adoption of ASC 740, companies are required to adjust their financial statements to reflect only
those tax positions that are more-likely- than-not to be sustained. Any necessary adjustment would be recorded directly to retained earnings and
reported as a change in accounting principle.
As of December 31, 2013 and 2012, we have provided a 100%
valuation allowance for any deferred tax assets as management has determined that it is more-likely-than-not that we will not sustain the use of our
net operating loss carryforwards.
The components of the Company’s deferred tax asset as of
December 31, 2013 and 2012 are as follows:
|
|
|
|
2013
|
|
|
2012
|
Net operating loss carry forward |
|
|
|
$ |
164,218 |
|
|
$ |
137,200 |
|
|
|
|
|
|
(164,218 |
) |
|
|
(137,200 |
) |
|
|
|
|
$ |
— |
|
|
$ |
— |
|
YACHT FINDERS, INC.
(A Development Stage Company)
Notes to Financial Statements
(4) INCOME TAXES (CON’T)
A reconciliation of income taxes computed at the statutory rate
to the income tax amount recorded is as follows:
|
|
|
|
2013
|
|
|
2012
|
Tax credit at statutory rate (35%) |
|
|
|
$ |
(27,018 |
) |
|
$ |
(26,250 |
) |
Increase in valuation allowance |
|
|
|
|
27,018 |
|
|
|
26,250 |
|
|
|
|
|
$ |
— |
|
|
$ |
— |
|
At December 31, 2013, the amount of gross unrecognized tax
benefits before valuation allowances and the amount that would favorably affect the effective income tax rate in future periods after valuation
allowances were $0. The Company has not accrued any additional interest or penalties as a result of the adoption of ASC 740.
The Company files income tax returns in the United States federal
jurisdiction and certain states in the United States. No tax returns are currently under examination by any tax authorities.
SUBSEQUENT EVENTS
The Company has evaluated all subsequent events through March 11,
2014, the date the financial statements were issued, and no additional items were noted that need to be disclosed.
ITEM
9. |
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE |
None.
ITEM 9A. CONTROLS AND
PROCEDURES.
Evaluation of Disclosure Controls and
Procedures
The Company’s management is responsible for
establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) that is designed to
ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is recorded,
processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedure
include, without limitations, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it
files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or
officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding
required disclosure.
In accordance with Exchange Act Rules 13a-15 and 15d-15, an
evaluation was completed by the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of
the Company’s disclosure controls and procedures as of the end of the period covered by this Annual Report. Based on that evaluation, the
Company’s sole officer concluded that the Company’s disclosure controls and procedures were not effective in providing reasonable assurance
that the information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act was recorded, processed,
summarized, and reported within the time periods specified in the Commission’s rules and forms.
Management’s Report on Internal Control over Financial
Reporting
Our management is responsible for establishing and
maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f)
promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company’s principal executive and
principal financial officers and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting
principles generally accepted in the United States of America and includes those policies and procedures that:
• |
|
Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of the assets of the company; |
• |
|
Provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and
that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;
and |
• |
|
Provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial
statements. |
Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be
effective can provide only reasonable assurance with
respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material
misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are
known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate,
this risk.
As of December 31, 2013 management assessed the
effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting
established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(“COSO”) and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, during the period covered by this
report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described
below. This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected
our internal controls and that may be considered to be material weaknesses.
The matters involving internal controls and procedures that
our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a
functioning audit committee, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2)
inadequate segregation of duties consistent with control objectives; and (3) ineffective controls over period end financial disclosure and reporting
processes. The aforementioned material weaknesses were identified by our management in connection with the review of our financial statements for the
year ended December 31, 2013.
Management believes that the material weaknesses set forth
in items (2) and (3) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee
and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of
required internal controls and procedures, which could result in a material misstatement in our financial statements in future
periods.
This annual report does not include an attestation report
of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation
by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only the management’s report in this
annual report.
Management’s Remediation
Initiatives
Given the financial resources available to the Company, the
Company is not in a position to institute any realistic remediation of the identified material weaknesses and other deficiencies and enhance our
internal controls. As such time as the Company commences operations and has the financial resources to address and eliminate the identified weaknesses,
we intend to create take action to do so. Unfortunately, until the Company has such financial resources, the identified weaknesses will continue to
exist.
Changes in Internal Control over Financial
Reporting. During the last quarter of the Company’s fiscal year ended December 31, 2013, there were no changes in the Company’s
internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to
materially affect, the Company’s internal control over financial reporting.
Limitations on the Effectiveness of Controls.
A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control
system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control
issues, if any, within a company have been detected.
ITEM 9B. OTHER
INFORMATION
None
PART III.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS
AND CORPORATE GOVERNANCE
Set forth below is the name of our sole director and executive
officer, his age, all positions and offices that he held with us, the period during which he has served as such, and his business experience during at
least the last five years.
Name
|
|
|
|
Age |
|
Positions Held
|
|
|
|
|
|
41 |
|
|
CEO, CFO President, Treasurer and Secretary since 2007 |
Thomas W. Colligan has been our director, chief
executive officer, chief financial officer, president, treasurer and secretary since October 2007. He is also currently the business development
manager of Adventist Healthcare, Inc. and has held such position since June 2005. Mr. Colligan has also been an adjunct professor of psychology at
Montgomery College, Maryland, since 2003 and a Group Psychotherapist with J&E Associates in Maryland since November 2001. Mr. Colligan holds a
Masters Degree in Social Work and specializes in the delivery of quality behavioral healthcare to individuals and groups. Prior to joining Adventist,
Mr. Colligan’s work focused on the investigation and analysis of clinical data relating to behavioral health through his work as a Clinical
Research Coordinator and Psychotherapist with the Centers for Behavioral Health in Maryland. Mr. Colligan has also co-authored three works:
“Understanding Workplace Stress—Journal of Workplace Behavioral Health;” “Measuring cultural climate in a uniformed services
medical center, Military Medicine, 164(3), 202-208;” and “Spouse abuse: Physician guidelines to identification, diagnosis, and
management in the uniformed services, Military Medicine, 164(1), 30-36.” Mr. Colligan is currently an MBA candidate at Frostburg State
University in Maryland. He expects to matriculate in August 2006. Other than Yacht Finders, Inc., Mr. Colligan is not a director, executive officer or
significant shareholder of any other public reporting company.
Mr. Colligan devotes less than 5% of his business time to the
affairs of the Company. The time Mr. Colligan spends on the business affairs of the Company varies from week to week and is based upon the needs and
requirements of the Company.
Audit Committee and Audit Committee Financial
Expert
We do not currently have an audit committee financial
expert, nor do we have an audit committee. Our entire board of directors, which currently consists of Mr. Colligan, handles the functions that would
otherwise be handled by an audit committee. We do not currently have the capital resources to pay director fees to a qualified independent expert who
would be willing to serve on our board and who would be willing to act as an audit committee financial expert. As our business expands and as we
appoint others to our board of directors we expect that we will seek a qualified independent expert to become a member of our board of directors.
Before retaining any such expert our board would make a determination as to whether such person is independent.
Section 16(a) Beneficial Ownership Reporting
Compliance.
Section 16(a) of the Securities Act of 1934 requires the
Company’s officers and directors, and greater than 10% stockholders, to file reports of ownership and changes in ownership of its securities with
the Securities and Exchange Commission. Copies of the reports are required by SEC regulation to be furnished to the Company. Based on management’s
review of these reports during the fiscal year ended December 31, 2013, all reports required to be filed were filed on a timely basis.
Code of Ethics
Our board of directors has adopted a code of ethics that
our officers, directors and any person who may perform similar functions are subject to. Currently Mr. Colligan is our only officer and our sole
director, therefore, he is the only person subject to the Code of Ethics. If we retain additional officers in the future to act as our principal
financial officer, principal accounting officer, controller or persons serving similar functions, they would become subject to the Code of Ethics. The
Code of Ethics does not indicate the consequences of a breach of the code. If there is a breach, the board of directors would review the facts and
circumstances surrounding the breach and take action that it deems appropriate, which action may include dismissal of the employee who breached the
code. Currently, since Mr. Colligan serves as the sole director and sole officer, he is responsible for reviewing his own conduct under the Code of
Ethics and determining what action to take in the event of his own breach of the Code of Ethics.
ITEM 11. EXECUTIVE
COMPENSATION.
No past officer or director of the Company has received any
compensation and none is due or payable. Our sole current officer and director, Thomas W. Colligan, does not receive any compensation for the services
he renders to the Company, has not received compensation in the past, and is not accruing any compensation pursuant to any agreement with the Company.
We currently have no formal written salary arrangement with our sole officer. Mr. Colligan may receive a salary or other compensation for services that
he provides to the Company in the future. No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have
been adopted by the Company for the benefit of the Company’s employees.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth certain information regarding
beneficial stock ownership as of December 31, 2013 of (i) all persons known to us to be beneficial owners of more than 5% of our outstanding common
stock; (ii) each director of our company and our executive officers, and (iii) all of our officers and directors as a group. Each of the persons in the
table below has sole voting power and sole dispositive power as to all of the shares shown as beneficially owned by them, except as otherwise
indicated.
Name
|
|
|
|
Number of
Shares
Beneficially
Owned(1)
|
|
Percent of
Outstanding
Shares(1)
|
Fountainhead Capital Management Limited |
|
|
|
|
4,350,500 |
|
|
|
83.68 |
% |
Portman House
Hue Street
St Helier
Jersey JE4 5RP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
La Pergola Investments Limited |
|
|
|
|
769,500 |
|
|
|
14.80 |
% |
Portman House
Hue Street
St Helier
Jersey JE4 5RP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
Number of
Shares
Beneficially
Owned(1)
|
|
Percent of
Outstanding
Shares(1)
|
|
|
|
|
|
0 |
|
|
|
0.00 |
% |
5528 Westcott Circle
Frederick, Maryland |
|
|
|
|
|
|
|
|
|
|
Officers and directors as a group (one person) |
|
|
|
|
0 |
|
|
|
0.00 |
% |
(1) |
|
For the purposes of this table, a person is deemed to have
“beneficial ownership” of any shares of capital stock that such person has the right to acquire within 60 days of December 31, 2013. All
percentages for common stock are calculated based upon a total of 5,199,000 shares outstanding as of December 31, 2013, plus, in the case of the person
for whom the calculation is made, that number of shares of common stock that such person has the right to acquire within 60 days of December 31,
2013. |
ITEM
13. |
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE |
Certain Relationships and Related
Transactions
At December 31, 2013, the Company had loans and notes
outstanding from a shareholder in the aggregate amount of $354,131, plus accrued interest of approximately $63,300, which represents amounts loaned to
the Company to pay the Company’s expenses of operation. On December 31, 2013, the Payee under the Note and the Company agreed that the Due Date of
the Note would be extended to December 31, 2014.
Effective as of October 1, 2007, the Company entered into a
Services Agreement with FHM. The term of the Services Agreement is one year and the Company is obligated to pay FHM a quarterly fee in the amount of
$10,000, in cash or in kind, on the first day of each calendar quarter commencing September 30, 2007. A copy of the Services Agreement was attached to
the Company’s Form 10-Q for the period ended April 30, 2008 filed on June 9, 2008 as Exhibit 10.1 thereto. The term of the Services Agreement has
been extended to December 31, 2014.
Director Independence
As of November 8, 2007, Thomas W. Colligan was the sole
director of the Company. Mr. Colligan is not considered “independent” in accordance with rule 4200(a)(15) of the NASDAQ Marketplace Rules. We
are not currently traded on NASDAQ and are therefore not required to comply with the NASDAQ Marketplace Rules.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND
SERVICES.
AUDIT FEES
The aggregate fees billed by our auditors, Paritz & Co.,
P.A., for professional services rendered for the audit of our annual financial statements for fiscal year ended December 31, 2013 and review our
interim financial statements for the first, second and third quarters of 2014 are approximately $4,500.00. The aggregate fees billed by our auditors
for professional services rendered for the audit of our annual financial statements for fiscal year ended December 31, 2012 were approximately
$4,500.00.
AUDIT-RELATED FEES
During the last two fiscal years, no fees were billed or incurred
for assurance or related services by our auditors that were reasonably related to the audit or review of financial statements reported
above.
TAX FEES
There were no tax preparation fees billed for the fiscal years
ended December 31, 2013 or 2012.
ALL OTHER FEES
During the last two fiscal years, no other fees were billed or
incurred for services by our auditors other than the fees noted above. Our board, acting as an audit committee, deemed the fees charged to be
compatible with maintenance of the independence of our auditors.
THE BOARD OF DIRECTORS PRE-APPROVAL POLICIES
We do not have a separate audit committee. Our full board of
directors performs the functions of an audit committee. Before an independent auditor is engaged by us to render audit or non-audit services, our board
of directors pre-approves the engagement. Board of directors pre-approval of audit and non-audit services will not be required if the engagement for
the services is entered into pursuant to pre-approval policies and procedures established by our board of directors regarding our engagement of the
independent auditor, provided the policies and procedures are detailed as to the particular service, our board of directors is informed of each service
provided, and such policies and procedures do not include delegation of our board of directors’ responsibilities under the Exchange Act to our
management. Our board of directors may delegate to one or more designated members of our board of directors the authority to grant pre-approvals,
provided such approvals are presented to the board of directors at a subsequent meeting. If our board of directors elects to establish pre-approval
policies and procedures regarding non-audit services, the board of directors must be informed of each non-audit service provided by the independent
auditor. Board of directors pre-approval of non-audit services, other than review and attest services, also will not be required if such services fall
within available exceptions established by the SEC. For the fiscal year ended December 31, 2013, 100% of audit-related services, tax services and other
services performed by our independent auditors were pre-approved by our board of directors.
Our board has considered whether the services described above
under the caption “All Other Fees”, which are currently none, is compatible with maintaining the auditor’s
independence.
The board approved all fees described above.
PART IV
ITEM 15. EXHIBITS, FINANCIAL
STATEMENTS
The following documents are filed as part of this
10-K:
The following documents are filed in Part II, Item 8 of this
annual report on Form 10-K:
• |
|
Report of Paritz & Co. P.A., Independent Registered Certified
Public Accounting Firm |
• |
|
Balance Sheets as of December 31, 2013 and 2012 |
• |
|
Statements of Operations for the years ended December 31, 2013
and 2012 and the period from April 15, 2003 (inception) to December 31, 2013 |
• |
|
Statements of Changes in Stockholders’ Equity for the period
from April 15, 2003 (inception) to December 31, 2013 |
• |
|
Statements of Cash Flows for the years ended December 31, 2013
and 2012 and the period from April 15, 2003 (inception) to December 31, 2013 |
• |
|
Notes to Financial Statements |
2. |
|
FINANCIAL STATEMENT SCHEDULES |
All financial statement schedules have been omitted as they are
not required, not applicable, or the required information is otherwise included.
The exhibits listed below are filed as part of or incorporated by
reference in this report.
| Exhibit No. |
Identification of Exhibit |
| |
|
| 31.1. |
Certification of the Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002. |
| |
|
| 31.2. |
Certification of the Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002. |
| |
|
| 32.1 |
Certification of Officers pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
|
|
|
|
|
|
Yacht Finders, Inc.
(Registrant) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas W. Colligan
President, Chief Executive Officer, Chief
Financial Officer and Principal Accounting
Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following person on behalf of the registrant and in the capacity and on the date
indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas W. Colligan
Sole Director, President, Chief Executive
Officer, Chief Financial Officer and
Principal Accounting
Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
