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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
/x/ Quarterly Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Quarterly Period Ended December 31, 2002
/ / Transition Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Transition Period from __________ to ____________
Commission File Number 333-63432
New England Acquisitions, Inc.
(Exact name of small business issuer as specified in charter)
Florida
(State of either jurisdiction of incorporation or organization)
65-1102237
(IRS Employer Identification No.)
5 Ridge Road, Cos Cob, CT 06807
(Address of principal executive offices)
203-622-1848
(Issuer's telephone number)
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(Former name, address and former fiscal year, if changed since last report)
The number of shares of the issuer's outstanding common stock,
which is the only class of its common equity,
on February 12, 2003 was 3,157,875.
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Transitional Small Business Disclosure format (check one):
Yes_____ No_X___
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PART I FINANCIAL INFORMATION
Item 1. - Financial Statements
NEW ENGLAND ACQUISITIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEETS
March 31, December 31,
2002 2002
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(Audited) (Unaudited)
CURRENT ASSETS
Cash $100 $9,238
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Total Current Assets 100 9,238
OTHER ASSETS
Restricted Cash 15,000 -
License agreement - 75,188
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15,000 75,188
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$15,100 $84,426
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued expenses $7,500 $7,500
Due to principal stockholder 20,034 23,584
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Total Current liabilities 27,534 31,084
STOCKHOLDERS' EQUITY
Common stock authorized 150,000,000
shares; $0.00001 par value; issued
and outstanding 3,007,500 and
3,157,875 shares at March 31
and December 31, 2002 30 32
Additional paid-in capital - 75,186
Deficit accumulated during Development Stage (12,464) (21,876)
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Total Stockholders' Equity-Deficit (12,434) 53,342
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$15,100 $84,426
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See accompanying notes to financial statements.
NEW ENGLAND ACQUISITIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS' EQUITY
For the Period April 18, 2001 (Inception) to December 31, 2002
Contributed Accumulated
Number Amount Capital Deficit Total
--------- -------- -------- -------- -------
Issuance of shares to
offices and directors
@$.001 per share 200,000 $ 200 - - $200
Effect of 15 to 1
stock split and
change of par
value to $.00001
per share 2,800,000 (170) $170 - -
Sale of 7,500
shares @$2.00
per share 7,500 - 15,000 - 15,000
Cost of registration - - (15,170) ($3,364) (18,534)
Net loss for period - - - (9,100) (9,100)
--------- -------- -------- -------- -------
Balance
March 31,
2002 (audited) 3,007,500 30 - (12,464) (12,434)
Issuance of shares
for purchase of
License agreement
at $.50 per share 150,375 275,186 75,186 - 75,188
Net loss for the
nine month period
ending December
31, 2002
(unaudited) - - - (9,412) (9,412)
--------- -------- -------- -------- -------
3,157,875 $32 $75,186 $(21,876) ($53,342)
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See accompanying notes to financial statements.
NEW ENGLAND ACQUISITIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF NET LOSS
Inception
For the three month Period For the six month Period to
ended December 31, ended December 31, December 31,
2001 2002 2001 2002 2002
--------- --------- --------- --------- ---------
Unaudited Unaudited (Unaudited) (Unaudited)
GENERAL AND
ADMINISTRATIVE
EXPENSES $500 $5,862 $500 $9,412 $21,876
--------- --------- --------- --------- ---------
500 5,862 500 9,412 21,876
--------- --------- --------- --------- ---------
NET LOSS FOR
THE PERIOD $500 $5,862 $500 $9,412 $21,876
========= ========= ========= ========= =========
NET LOSS PER
SHARE $ - $ - $ - ($0.003) ($0.007)
========= ========= ========= ========= =========
Weighted average
number of common
Shares Outstanding - - 2,239,475 3,044,166 3,030,000
========= ========= ========= ========= =========
See accompanying notes to financial statements.
NEW ENGLAND ACQUISITIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
(Unaudited)
Inception
For the nine month To
Period Ended December 31 December 31
2001 2002 2002
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(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period $ - ($9,412) ($18,512)
Adjustments to reconcile net loss to
Net cash provided by (used in)
operating activities - - -
Restricted cash - - -
Accrued expenses - - 7,500
Due to principal stockholder - 3,550 23,584
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Net cash Provided by Operating Activities - (5,862) 12,572
CASH FLOWS FROM FINANCING ACTIVITIES
Sales of common stock 200 15,000 15,200
Cost - - (18,534)
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Net Cash Provided by Financing Activities 200 15,000 (3,334)
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Net increase in cash 200 9,138 9,238
CASH AT BEGINNING OF PERIOD - 100 -
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CASH AT END OF PERIOD $200 $9,238 $9,238
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SUPPLEMENTAL CASH FLOW INFORMATION: None
See accompanying notes to financial statements.
NEW ENGLAND ACQUISITIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO THE FINANCIAL STATEMENTS
1. Condensed Financial Statements
In the opinion of the Company, the accompanying unaudited condensed
financial statements include all adjustments (consisting only of normal
recurring accruals) which are necessary for a fair presentation of the
results for the periods presented. Certain information and footnote
disclosure, normally included in the financial statements prepared in
accordance with generally accepted accounting principles, have been
condensed and omitted. The condensed financial statements should be read in
conjunction with the Company's financial statements included in its Annual
Report on Form 10K-SB for the fiscal year ended March 31, 2002. Reference
is also made to the Company's Post Effective Amendment Number 5 to the
Company's prospectus dated October 7, 2002 filed pursuant to Rule 424 under
the Securities Act of 1933. The Company has had no significant operations
since inception.
2. Assets and Rights Agreement
On October 7, 2002, the Company acquired certain rights to market and sell
three different products from ADM Tronics Unlimited, Inc.. In connection
with the acquisition, the Company issued 150,375 shares of its common stock
to ADM Tronics Unlimited, Inc. An aggregate value of $75,188 was assigned
to the shares.
Item 2. Management's Plan Of Operation
The following should be read in conjunction with our financial statements and
the related note that appear elsewhere in this Quarterly Report.. The discussion
contains forward-looking statements that reflect our plans, estimates and
beliefs. Our actual results could differ materially from those discussed in the
forward-looking statements.
We have not had any revenues or operations since inception. Our ability to
become and continue as a going concern is dependent in significant part upon
obtaining additional substantial capital.
We have obtained limited rights to sell an ethnic shave cream, a burn lotion and
the Aurex-3 device from ADM Tronics Unlimited, Inc. Subject to the availability
of sufficient capital, we intend to initially aggressively market the shave
cream and the Aurex-3. We have no plans to market the burn lotion. We believe
that we will require funding of approximately $140,000 to aggressively market
the products and for working capital during the first year after our acquisition
of the products. We believe that we can begin marketing the products within
three months from the time we acquire them from ADM Tronics.
We plan to obtain $150,000 through the private sale of our common stock. We
cannot assure you that we will be successful in obtaining any funds or that
$150,000 will be sufficient to fund our initial operations.
If we are successful in obtaining additional capital of $150,000, we plan to
initially utilize a phased communications and distribution strategy to market
the ethnic shave cream. We intend to begin with New York City and the Bahamas.
In the first phase, a communications piece will be developed and distributed to
distribution units and orders will be taken from a website, or by replying to
the direct mail campaign. In the second phase, communications will be sent to
Philadelphia, Baltimore, Washington, Chicago, Detroit, Houston, Memphis, New
Orleans, and, subsequently, Los Angeles. In the third phase, we intend to hire
a sales person to visit large distributors to retail stores. Our estimated
initial expenditures are $50,000 for the design and development of our website
and its maintenance for the first year, $2,000 for the purchase of lists, and
$15,000 for the development, production and distribution of hard copy and
offline mail messages.
We also plan to use a similar phased communications and distribution strategy to
market the Aurex-3. Our estimated initial expenditures are $50,000 for the
design and development of our website and its maintenance for the first year,
and $15,000 for the development, production and distribution of hard copy and
offline mail messages.
If we are only able to obtain additional capital of at least $70,000, but less
than $140,000, we intend to develop a website and to market the ethnic shave
cream and the Aurex-3 through the website and our communications piece. If we
are able to obtain additional capital of at least $140,000, we intend to
aggressively market the ethnic shave cream and the Aurex-3.
If we not able to obtain additional capital of at least $70,000, we intend to
market the ethnic shave cream through commissioned sales agents and our sales
piece and, to the extent of available capital, engage in additional limited
promotional activities.
If we only obtain proceeds of $50,000 or less, including $7,500 released to us
from the escrow account, the capital will only be sufficient to meet our
anticipated capital requirements for less than six months. Even if we are able
to obtain additional capital of $150,000 in addition to the proceeds from the
escrow account, we believe that the capital will only be sufficient to meet our
anticipated capital requirements for one year. If we exhaust our capital and
cannot obtain additional capital, our stockholders can expect to lose all of
their investment.
We now believe that we can begin marketing products d during the third quarter
of 2003. If we cannot obtain any meaningful amounts of capital or if the only
funds available to us are those released to us from the escrow account, we will
attempt to market the products solely through commissioned sales agents and our
sales piece and we will not be able to develop a website. There can be no
assurance that we can find suitable sales agents who will work solely on a
commission basis or that the products can be sold without any promotional
activities on our part, other than the communications piece we intend to
develop.
If we do not make minimum royalty payments or purchase certain quantities of
products from ADM Tronics within the first year after we acquire its products
and continuing in subsequent years, we will lose certain rights of exclusivity.
We intend to pay the minimum royalties from revenues derived from sales. We do
not know if we will be able to purchase a sufficient number of the Aurex-3 from
ADM Tronics to maintain all of the rights we initially receive. We cannot
assure you that we will derive any meaningful revenues from the sale of any of
the products.
We will reimburse ADM Tronics for an estimated amount of $4,500 for any tooling
or non-recurring engineering services that are required to be secured in support
of the manufacturing of our products. Tooling includes molds, plates, screens
and other items used to produce components in a manufacturing process. Non-
recurring engineering services are services such as drafting, preparation of
schematics, evaluations and measurements that are performed prior to
manufacturing but are not repeated during the manufacturing process.
We must pay $25,000 to ADM Tronics in advance of the initiation of production of
the burn lotion for ADM Tronics' expenses and establishment of regulatory
support and processes for the distribution of the burn lotion by us. If we do
not make the payment within one year from the consummation of the transaction
with ADM Tronics, we will lose the exclusive rights to the burn lotion. Because
we do not have any plans to market the burn lotion, we do not believe that the
loss of the exclusive rights would be material to us.
We do not expect to purchase or sell any significant equipment, engage in
product research or development and do not expect any significant changes in the
number of our employees.
We are in the advanced stage of negotiation to acquire all of the equity
interest in a corporation that intends to shortly open a retail store which will
sell and install automobile stereo and security systems. The equity interest is
owned by the brother of our president. If we make the acquisition, we
anticipate, issuing 100,000 shares of our common stock to the seller. We
cannot assure you that the acquisition will be made or, if made, that it will be
advantageous to us.
Item 2. Controls and Procedures.
(a) Our principal executive officer and principal financial officer has
evaluated the effectiveness of our disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) as of a date within 90
days prior to the filing date of this quarterly report and has concluded
that our disclosure controls and procedures are adequate.
(b) There were no significant changes in the registrant's internal controls
or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
(c) Not applicable
PART II OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.
(a), (b) Not applicable
(c) On November 7, 2002, we issued 150,375 shares of our common stock to
ADM Tronics Unlimited, Inc. pursuant to our Asset and Rights Purchase
Agreement with ADM Tronics Unlimited, Inc. as described in our
prospectus dated October 7, 2002 filed pursuant to Rule 424 under the
Securities Act of 1933. Reference is made to the prospectus for a
description of the Agreement as well as the type and amount of
consideration we received. There were no principal underwriters. We
claimed an exemption from the registration requirements of the
Securities Act of 1933 pursuant to Section 4(2) of that Act inasmuch
as no public offering was involved.
(d) During the quarterly period ended December 31, 2002, we utilized
approximately $6,000 of the proceeds from our public sale of common
stock. Of the foregoing, $2,200 was paid to our president to
reimburse him for expenses he had advanced on our behalf and the
remainder represented professional fees, web site development costs
and administrative costs.
Item 6. Exhibits And Reports On Form 8-K.
(a) Exhibits
3.01(a) Articles of Incorporation.*
3.01 (b) Form of Articles of Amendment to Articles of
Incorporation.**
3.03 Bylaws.*
4.01 Form of Specimen Stock Certificate for the
Registrant's Common Stock. **
10.01 Escrow Agreement of August 3, 2001 between
the Registrant and Patriot National Bank.**
99.01 Certification Of Chief Executive Officer
And Chief Financial Officer
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* Filed as part of registration statement on Form SB-2, File No. 333-63432.,
and hereby incorporated by reference.
** Filed as part of Amendment No. 1 to registration statement on Form SB-2 and
hereby incorporated by reference.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
New England Acquisitions, Inc.
By: /s/ _Gary Cella___
Name: Gary Cella
Title: Chief Executive Officer and Chief Financial Officer
Date: February 14, 2003
CERTIFICATION
I, Gary Cella, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of New England
Acquisitions, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. I am the registrant's only certifying officer and am responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a. designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to me by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b. evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c. presented in this quarterly report my conclusions about the
effectiveness of the disclosure controls and procedures based on my
evaluation as of the Evaluation Date;
5. I have disclosed, based on my most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):
a. all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b. any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. I have indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of my most
recent evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
Date: February 14, 2003
/s/ Gary Cella
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Gary Cella
Principal Executive Officer and
Principal Financial Officer of the Registrant