10QSB/A 1 freshharvestjan2206.htm FRESH HARVEST PRODUCTS FORM 10QSB/A UNITED STATES

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-QSB/A


[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended January 31, 2006


 [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the transition period from _____________ to _____________


Fresh Harvest Products, Inc.

(Name of small business issuer in its charter)


   

New Jersey

000-51390

33-1130446

(State or other jurisdiction of incorporation or organization)

(Commission File  Number)

(I.R.S. Employer Identification Number)


   

280 Madison Avenue, Suite 1005, New York, NY

 

10016

(Address of principal executive offices)

 

(Zip Code)


Issuer’s telephone number:  (212) 889-5904


Check whether the issuer (1) has filed all documents and reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filings for the past 90 days.   YES  [X]     NO   [  ]


Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2  of the Exchange Act.)  [ ] Yes [X] No


APPLICABLE ONLY TO CORPORATE ISSUERS:


State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:  February 12, 2006 - 14,148,963


Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]


SEC 2334 (9-05)            Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the   form displays a  currently valid OMB control number.




1





EXPLANATORY NOTE



As indicated in the Registrant’s Current Report on Form 8-K/A filed with the Securities and Exchange Commission on December 1, 2006, this amendment is being filed to correct errors to the financial statements contained in the Registrant’s Form 10-QSB for the period ending January 31, 2006 primarily relating to accounting for the Registrant’s reverse merger that occurred on December 16, 2005, and related recapitalization and valuation of shares issued during the aforementioned period. Specifically, the restated financial statements herein:


1)  Correct accounting for its reverse merger and related recapitalization to properly reflect the number of shares of common stock received in the exchange, including the addition of footnote disclosure explaining the significant terms of the transaction.

2)  Contain disclosure of significant terms of convertible notes.

3)  Reclassify interest income to general and administrative expenses.

4)  Correct the weighted average of shares outstanding used in earnings per share computations.

5)  Correct the valuation of shares issued during the periods.

6)   Correct the Statements of Cash Flows related to the above items.

In addition, this amendment is also being filed to correct Part I, Item 3 – “Controls and Procedures” so that this section is in exact compliance with the requirements of the Exchange Act of 1934, as amended, and to correct errors in Exhibit 31.1 –“Certification” of the Chief Executive Officer/Chief Financial Officer. In addition, separate certification exhibits of the Chief Financial Officer Exhibits 31.2 and 32.2 have been eliminated because since the   filing of the original Form 10-QSB for the period ending January 31, 2006, Michael Jordan Friedman has become the Chief Financial Officer in addition to the Chief Executive Officer.

















2




FRESH HARVEST PRODUCTS, INC.

FORM 10-QSB


INDEX



Part I-- FINANCIAL INFORMATION


  Item 1. Financial Statements as of January 31, 2006

Balance Sheet

4

Statement of Operations

5

Statement of Stockholders’ Equity

6

Statement of Cash Flows

7

Notes to Financial Statements

8-14


  Item 2. Management's Discussion and Analysis of Financial Condition

15


  Item 3. Control and Procedures

16


Part II-- OTHER INFORMATION


  Item 1. Legal Proceedings

17


  Item 2. Changes in Securities

17


  Item 3. Defaults Upon Senior Securities

18


  Item 4. Submission of Matters to a Vote of Security Holders

18


  Item 5. Other Information

18


  Item 6. Exhibits

18


Signature

18


Certifications

attached










3




PART I


Item 1.    FINANCIAL INFORMATION - FINANCIAL STATEMENTS AS OF 1/31/2006


FRESH HARVEST PRODUCTS, INC.

Balance Sheet

(a development stage company)

January 31, 2006


    

 January 31, 2006

Unaudited

 

 October 31, 2005

Audited

       

ASSETS

      

     Current Assets

      

          Cash in Bank

   

$         35,677

 

$         30,235

       

     Other Assets

      

          Deposits

   

           2,675

 

           2,675

     Total Other Assets

   

           2,675

 

           2,675

       

TOTAL ASSETS

   

$         38,352

 

$         32,910

       

LIABILITIES & STOCKHOLDERS’ EQUITY

     

     Current Liabilities

      

          Accrued Expenses

   

$                   -  

 

$             1,200

          Payroll Taxes Payable

   

         18,733

 

           2,755

          Loans Payable

   

           3,700

 

           3,700

     Total Current Liabilities

   

         22,433

 

           7,655

       

     Long-Term Liabilities

      

          Loans Payable

   

       500,000

 

       100,000

       

     Total Liabilities

   

       522,433

 

       107,655

       

     Stockholders’ Equity

      

          Common Stock, Authorized 200,000,000 Shares,

    

Issued and Outstanding: 578,412 and 363,052 Shares, respectively

    

               Par Value $0.0001

   

               58

 

              36

       

          Paid in Capital

   

       275,570

 

        170,292

       

          Accumulated Deficit, January 31, 2006

  

      (759,709)

 

      (245,073)

       

     Total Stockholders’ Equity

   

      (484,081)

 

        (74,745)

       

TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY

 

$         38,352

 

$         32,910


The accompanying notes are an integral part of these statements



4




FRESH HARVEST PRODUCTS, INC.

Statement of Operations

(a development stage company)

For the period from November 26, 2003 (inception) to January 31, 2006


   

Three months ended January 31, 2006

 

Three months ended  January 31, 2005

 

Since Inception [Nov 26, 2003] Through January 31, 2006

        

Revenue

  

 $                   -

 

 $                -   

 

 $                  -

        

Expenses

       

     Amortization

  

-

 

-

 

                   250

     Merger Costs

  

400,000

 

-

 

400,000

     General & Administrative

  

          114,636

 

           9,326

 

            359,459

        

Total Expenses

  

          514,636

 

           9,326

 

            759,709

        

Income (Loss) before Taxes

  

        (514,636)

 

         (9,326)

 

          (759,709)

        

Provision for Income Taxes

  

                    -   

 

                 -   

 

                      -   

        

Net Income (Loss)

  

 $          (514,636)

 

 $          (9,326)

 

 $           (759,709)

        
        
        

Basic and Diluted Earnings (Loss) per Share

 

$                (0.03)

 

a

 

$                 (0.05)

        

Weighted Average Number of Shares

 

15,166,840

 

15,159,617

 

15,160,558

        
        

a = Less than $0.01

       



The accompanying notes are an integral part of these statements






5




FRESH HARVEST PRODUCTS, INC.

Statement of Stockholders’ Equity

(a development stage company)

For the period from November 26, 2003 (inception) to January 31, 2006


 

Common

 

Stock

 

Paid in

 

Accumulated

  
 

Shares

 

Amount

 

Capital

 

Deficit

 

Total

          

Shares Issued at Inception, November 26, 2003

   313,000

 

     $      31

 

 $   35,379

   

 $ 35,410

Contributed Capital at Inception, November 26, 2003

   

25,956

   

      25,956

Net Income (Loss), Inception to October 31, 2004

      

 $     (61,366)

 

     (61,366)

          

Shares Issued, February 2004

       3,333

 

            0

 

          1,000

   

           1,000

Share Issued, November 2004

       2,000

 

            0

 

            600

   

             600

Shares Issued, January 2005

       1,667

 

            0

 

        500

   

        500

Shares Issued, April 2005

       6,667

 

            1

 

        1,999

   

      2,000

Shares Issued, May 2005

     16,667

 

           2

 

        3,513

   

      3,515

Contributed Capital, May 2005

  

           -   

 

7,000

   

        7,000

Shares Issued, June 2005

         133

 

            0

 

          400

   

           400

Shares Issued, July 2005

       8,833

 

            1

 

      26,499

   

      26,500

Contributed Capital, July 2005

    

35,847

   

      35,847

Shares Issued August 2005

         833

 

            0

 

        2,500

   

        2,500

Shares Issued September 2005

       4,167

 

            0

 

      12,500

   

      12,500

Shares Issued October 2005

       5,752

 

            1

 

      17,255

   

    17,256

Net Income (Loss) October 31, 2005

      

      (183,707)

 

     (183,707)

          

Shares Issued November 2005

     20,844

 

            2

 

      28,798

   

   28,800

Shares Issued December 2005

   195,505

 

           20

 

      61,480

   

  61,500

Shares Issued January 2006

         344

 

            0

 

      15,000

   

   15,000

Adjustment

(1,333)

   

(656)

   

(656)

          

Net Income (Loss), November 1, 2005 to January 31, 2006

 

 

 

 

 

 

      (514,636)

 

   (514,636)

Balance, January 31, 2006

   578,412

 

  $         58

 

$    275,570

 

 $     (759,709)

 

    $(484,081)



The accompanying notes are an integral part of these statements




6




FRESH HARVEST PRODUCTS, INC.

Statement of Cash Flows

(a development stage company)

For the period from November 26, 2003 (inception) to January 31, 2006


   

Three months ended January 31, 2006

 

Three months ended January 31, 2005

 

Since Inception [Nov 26, 2003] Through January 31, 2006

        

Cash flows provided by (used for) operating activities:

       

   Net Loss

  

 $      (514,636)

 

 ($           9,326)

 

 $           (759,709)

Adjustments to reconcile net loss to net cash     provided by (used for) operating activities:

       

Stock issued for services

  

15,300

 

2,600

 

116.200

Amortization

-

 

200

 

250

Changes in assets and liabilities:

      

Decrease in accrued expenses

 

(1,200)

 

-

 

-

Increase in deposits

  

-

 

-

 

(2,675)

Increase in payroll taxes payable

 

15,978

 

-

 

18,733

   

 

 

 

 

 

        

Net cash provided by (used for) operating activities

 

(484,558)

 

(6,526)

 

              (627,201)

        

Cash flows provided by (used for) investing activities:

       

Organization costs

  

                     -

 

                     -

 

                    (250)

        

Cash flows provided by (used for) financing activities:

       

Proceeds from issuance of loans payable

  

400,000

 

-

 

503,700

Sale of common stock

 

90,000

 

-

 

90,625  

Capital contributions

  

-

 

6,526

 

68,803

        
        

Cash provided by (used for) financing activities

          490,000

 

              6,526

 

               663,128

        
        

Net increase (decrease) in cash and cash equivalents

  

5,442

 

-

 

35,677

        

Cash at beginning of period

  

            30,235

 

                   -   

 

                    -

        

Cash at end of period

  

 $         35,677

 

 $                -   

 

 $              35,677



The accompanying notes are an integral part of these statements




7




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS

January 31, 2006


NOTE 1.

GENERAL ORGANIZATION AND BUSINESS


Serino 1, Corp., (the "Company" or "Serino"), a non-operating public company, was incorporated on April 21, 2005 in the State of New Jersey.


On December 16, 2005, Serino entered into an agreement and plan of merger (the "Agreement") with Fresh Harvest Products, Inc. ("FHP"), which was incorporated on November 26, 2003 in the State of New York, and Certain Shareholders of FHP.  FHP is a development stage company organized to market and distribute a line of organic food products.  Pursuant to the Agreement, Serino acquired 100% of the outstanding capital stock of FHP.  In connection with the merger, Serino changed its name to Fresh Harvest Products, Inc.  Under the terms of the Agreement, the stockholders of FHP exchanged all of their issued and outstanding shares of common stock for 383,628 shares of Serino common stock (the "Exchange").  Concurrent with the Exchange the principal and founding shareholder of Serino retired all of its founding shares in exchange for 165,532 new shares of FHP.  The 383,628 shares of common stock issued to the FHP stockholders represents approximately 70.00% of the ownership interests in Serino.  FHP had no outstanding options or warrants immediately prior to the merger.  The Exchange, which resulted in the stockholders of FHP having control of Serino, represents a recapitalization of Serino, or a "reverse merger" rather than a business combination.  In connection therewith, Serino's historic capital accounts were retroactively adjusted to reflect the equivalent number of shares issued by Serino in the Exchange while FHP's historical accumulated deficit was carried forward and the statement of operations reflects the activities of FHP from the commencement of its operations on November 26, 2003.  


In connection with the Agreement, FHP executed a note payable over a two (2) year period in the amount of $400,000 for the acquisition of Serino to certain stockholders.  The note bears interest at 3%, accrued quarterly, and provides for standard anti-dilution provisions.  The agreement also provides for the reduction of this shareholders interest from 30% to 20% upon repayment of the note, as well as an increase in ownership to majority control if it is not repaid within two (2) years.


As a development stage company, FHP's primary efforts have been devoted to developing its line of organic food products and raising capital. The Company has limited capital resources and has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future.  As of January 31, 2006, the Company had approximately $35,677 in cash, cash equivalents and investments.  Management believes that cash, cash equivalents and investments on hand as of January 31, 2006 are not sufficient to fund operations through January 31, 2007.  The Company will be required to raise additional funds to meet its short and long-term planned goals. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to the Company.






8




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS

January 31, 2006


NOTE  2.

SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES


The relevant accounting policies are listed below.


Accounting Basis


The basis is presented in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-QSB and Item 310 under subpart A of Regulation S-B.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of management, all adjustments (consisting only of normal occurring accruals) considered necessary in order to make the financial statements not misleading, have been included. Operating results for the three months ended January 31, 2006 are not necessarily indicative of results that may be expected for the year ending October 31, 2006. The financial statements are presented on the accrual basis.


Effective December 16, 2005, the Company declared a 1 for 30 reverse split of its common shares.  Such split has been retroactively affected in all periods presented.  


Earnings per Share


The basic earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the weighted average number of common shares during the year. The diluted earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted during the period for any potentially dilutive debt or equity.


The Company has not issued any options or warrants or similar securities since inception. Potentially dilutive common shares of 200,000 related to convertible loans were not included in the calculation for any periods presented as they are anti-dilutive.


Common shares and common share equivalents of 14,840,173 issued by the Company at prices below the offering price during the twelve-month period prior to the proposed offering date have been included in the calculation of common share and common share equivalents as if they were outstanding for all periods presented








9




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS-CONTINUED

January 31, 2006


Dividends


The Company has not yet adopted any policy regarding payment of dividends. No dividends have been paid during the period shown.


Income Taxes


The provision for income taxes is the total of the current taxes payable and the net of the change in the deferred income taxes. Provision is made for the deferred income taxes where differences exist between the period in which transactions affect current taxable income and the period in which they enter into the determination of net income in the financial statements.


Advertising


Advertising is expensed when incurred. There has been no advertising during the period.


General and Administrative Expenses


General and administrative expenses include costs associated with developing the Company’s line of products, such as designs, packaging and selling, as well as other administrative expenses such as telephone, legal fees, travel and the like.


Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.


NOTE 3.

LOANS PAYABLE


Loans payable consist of the following:


 

January 31, 2006

(Unaudited)

October 31, 2005

Convertible loans bearing interest at a rate of 10% and due at various dates between November 2006 and April 2007.  The notes are convertible into common shares at any time between the date of issue of the notes and their due dates at a conversion rate of $0.50 per share for a total of 200000 shares.





$100,000





$100,000


Note payable incurred in connection with reverse merger – see Note 1



$400,000



$           0

Total

$500,000

$100,000



10




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS-CONTINUED

January 31, 2006


NOTE 4.

STOCKHOLDERS’ EQUITY


Common Stock –all Common Stock has a par value of $0.0001.


In January 2006 the Company issued 344 shares of its par value common stock for investors in the Company. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $15,000.


In December 2005 the Company issued 195,505 shares of its par value common stock as part of the merger with Serino 1, Corp., sales to investors and other services. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $61,500.


In November 2005 the Company issued 20,844 shares of its par value common stock for investors in the Company. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $28,800.


In October 2005 the Company issued 5,752 shares of its par value common stock as signing bonuses to new managerial employees. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $17,256.


In September 2005 the Company issued 4,167 shares of its par value common stock for Board of Advisors Members.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $12,500.


In August 2005 the Company issued 833 shares of its par value common stock for marketing and consulting services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $2,500.


In July 2005 the Company issued 8,833 shares of its par value common stock for managerial, Board of Advisor Members web design, art work design and creation and financial services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $26,500.


In June 2005 the Company issued 133 shares of its par value common stock for marketing and consulting services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $400.


In May 2005 the Company issued 16,667 shares of its par value common stock for managerial and financial services and Contributed Capital.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $3,515.


In April 2005 the Company issued 6,667 shares of its par value common stock for managerial services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $2,000.




11




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS-CONTINUED

January 31, 2006


NOTE 4.

STOCKHOLDERS’ EQUITY (Continued)


In January 2005 the Company issued 1,667 shares of its par value common stock for managerial services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $500.


In November 2004 the Company issued 2,000 shares of its par value common stock for graphic and marketing services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $600.


In February 2004 the Company issued 3,333 shares of its par value common stock for Board of Advisor Member and other services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $1,000.


In November 2003 the Company issued 313,000 shares of its par value common stock for founders, investors and related services.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $35,410.


During the month of July 2005, the Company received from its Chairman of the Board of Directors $35,847 in the form of Contributed Capital.


During the month of May 2005, the Company received from its Chairman of the Board of Directors $7,000 in the form of Contributed Capital.


On November 26, 2003 (inception), the Company received from its sole officer and Director, $25,956 in the form of Contributed Capital.


NOTE 5.

RELATED PARTY TRANSACTIONS


The Chief Executive Officer of the Company may be involved in other business activities.  This person may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts.




12




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS-CONTINUED

January 31, 2006


NOTE 6.

PROVISION FOR INCOME TAXES


The Company provides for income taxes under Statement of Financial Accounting Standards NO. 109, Accounting for Income Taxes. SFAS No. 109 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse.


SFAS No. 109 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.  All of the expenditures thus far have been to organize the Company and will not be expensed for tax purposes until the Company has operations.


As of January 31, 2006 deferred income taxes have been recorded due to the Company having no history of profitable operations.  Significant components of the Company’s net deferred income taxes are as follows:


Net operating loss carry forwards

$310,000

Less:  Valuation allowance

(310,000)


Net deferred income tax asset

$         0



During the three months ended January 31, 2006 the valuation allowance increased by $212,000.


NOTE 7.

REVENUE AND EXPENSES


The Company currently has no operations and no revenue.



NOTE 8.

OPERATING LEASES AND OTHER COMMITMENTS:


The Company also has no lease obligations.  





13




FRESH HARVEST PRODUCTS, INC.

(a development stage company)

NOTES TO FINANCIAL STATEMENTS-CONTINUED

January 31, 2006


NOTE  9.

 THE EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARDS


Below is a listing of the most recent accounting standards and their effect on the Company.


SFAS 148         Accounting for Stock-Based Compensation-Transition and Disclosure

 

Amends FASB 123 to provide alternative methods of transition for an entity that voluntarily changes to the fair value based method of accounting for stock-based employee compensation.


SFAS 149      Amendment of Statement 133 on Derivative Instruments and Hedging Activities


This Statement amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts (collectively referred to as derivatives)  and for hedging activities under FASB Statement NO. 133, Accounting for Derivative Instruments and Hedging  Activities.


SFAS

150    Financial Instruments with Characteristics of both Liabilities and Equity


This Statement requires that such instruments be classified as liabilities in the balance sheet.  SFAS 150 is effective for financial instruments entered into or modified after May 31, 2003.


Interpretation No. 46 (FIN 46)


Effective January 31, 2003, The Financial Accounting Standards Board requires certain variable interest entities to be consolidated by the primary beneficiary of the entity if the equity investors in the entity do not have the characteristics of a continuing financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The Company has not invested in any such entities, and does not expect to do so in the foreseeable future.


The adoption of these new Statements is not expected to have a material effect on the Company’s financial position, results or operations, or cash flows.








14




ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS


General


Fresh Harvest Products, Inc. (the Company) was incorporated under the laws of the state of New York on November 26, 2003.  The Company was organized to market and distribute (both domestic and imported) a line of organic food products.


The Company has been in the development stage since inception and has no operations to date.  The Company has merged with Serino 1, Corp., a public reporting New Jersey corporation.  The Company has since become a New Jersey corporation.


Plan of Operation


The Company intends to continue the development and expansion of its line of organic, natural and kosher food products.  It is working towards the development and finalization of distribution agreements to ensure placement of its products in retail supermarkets and other food outlets.  We are actively seeking to raise capital to finance our business plan and to begin the production of our first run of retail packaged food bars.  We have not, as of this date succeeded in attracting suitable investment to do so.


Results of Operation


For the three months ended January 31, 2006 we had de minimus revenues compared to zero revenue for the same period ended January 31, 2005.  We experienced a net loss of $530,589 which was an increase of $521,263 from the same period ended January 31, 2005.  This increase was in General and Administrative expenses which included legal, accounting, consulting and payroll expenses and a one time expense associated with the merger with Serino 1, Corp.


Liquidity and Capital Resources


The balance of our Cash and equivalents increased by $5,432 during the three month period ended January 31, 2005.  Payroll expenses increased $15,978 because of the additional of managerial staff to guide the business. Also Long-term Loans Payable increased by $400,000 as a result of the Note Agreement we entered into in favor of Illuminate Corp. as a part of the merger with Serino 1, Corp.



ITEM 3. CONTROLS AND PROCEDURES


Disclosure Controls


As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including the chief executive officer and chief financial officer, of the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.




15




Based on that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective as of the end of the year to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accurately recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.


Internal Controls


In connection with the effectiveness of our Registration Statement on Form 10-SB, we first became subject to the reporting obligations of Section 13 of the Exchange Act in July 2005, and we became an active company (changing our status as a “blank check” company) in December 2005. Accordingly, we have only recently adopted and implemented various measures in order to improve control processes and corporate governance. As a non-reporting company, we were not required to adopt the types of internal control procedures that a reporting, active public company must adopt and maintain. Accordingly, we have recently taken steps to enhance existing policies, or implement new ones, so as to have an effective system of internal controls over financial reporting. These measures, which either have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting, include the development of policies and procedures and the educating of employees on existing policies and procedures in an effort to continuously improve our overall control environment. Except for the improvements described above, there have been no other changes in the internal control over financial reporting during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, internal controls over financial reporting.

 

We do not expect that disclosure controls or internal controls over financial reporting will prevent all errors or all instances of fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within its company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and any design may not succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Because of the inherent limitation of a cost-effective control system, misstatements due to error or fraud may occur and not be detected.




16





PART II - OTHER INFORMATION


Item 1.   Legal Proceedings.


The Company is currently not a party to any pending legal proceedings and no such action by or to the best of its knowledge, against the Company has been threatened.


Item 2.   Changes in Securities.


In November, 2005 the Company issued 20,844 shares of its par value common stock for investors in the Company. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $27,300.


In December 2005, the Company issued 166,907 shares of its par value common stock as part of its merger with Serino 1, Corp. other services. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $77,753.


In January 2006, the Company issued 344 shares of its par value common stock for investors in the Company. These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $15,000.


Subsequent to the period ended January 31, 2006:


Through February 12, 2006, the Company issued 13,597,916 shares of its common stock for services rendered to the Company by various individuals and entities, as reported on Form 8-K filed February 8 and 9, 2006.  These shares were issued under Section 4(2) of the Securities Act of 1933. These shares were valued by the Company at $135,979.


Item 3.   Defaults Upon Senior Securities.


          None


Item 4.   Submission of Matters to a Vote of Security Holders


No matter was submitted during the quarter ending January 31, 2006 covered by this report to a vote of the Company's shareholders, through the solicitation of proxies or otherwise.


Item 5.   Other Information.


None


Item 6.   Exhibits.


          (a)  Exhibits


          31.1 Certification pursuant to Section 302 of Sarbanes Oxley Act of 2002, Friedman

          32.1 Certification pursuant to Section 906 of Sarbanes Oxley Act of 2002, Friedman



17




SIGNATURES


In accordance with Section 12 of the Securities Exchange Act of 1934, the registrant caused this amendment to registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.


Fresh Harvest Products, Inc.

(Registrant)





/s/ Michael Jordan Friedman

_________________________________________

Michael Jordan Friedman, Chief Executive Officer



Date: January 22, 2007 as of March 17, 2006








18