10-Q 1 fsc_10q.htm FORM 10-Q Converted by EDGARwiz

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q



[ X ]

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended August 31, 2013


[ ]

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT


For the transition period from _________________________________ to ________________________


Commission File Number 000-54644



First State Capital Investments, Incorporated

(Exact name of registrant as specified in its charter)



                        Delaware                                                                         45-4371783

(State or other jurisdiction of incorporation of organization)        (I.R.S. Employee Identification Number)



                     1514 N. 35th Street, Seattle, Wa.                                         98103

(Address of principal executive offices)

       (Zip Code)


(206) 422-6677

(Registrant's telephone number, including area code)



(Former name, former address and former fiscal year, if changed since last report)



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.         [ X ] Yes    [   ]No


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   [   ] Yes      [ X ]No






Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer

Accelerated filer

Non-accelerated filer (Do not check if a smaller reporting company)   Smaller Reporting Company [ X ]


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


              [ X ] Yes    [   ]No



APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:


Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.         [   ] Yes    [   ]No



APPLICABLE ONLY TO CORPORATE ISSUERS:


Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.


Number of shares outstanding - 200,000 shares of common stock

Class of common stock Common stock, par value $0.001

As of October 1, 2013



EXPLANATORY NOTES


Unless otherwise noted, references in this registration statement to "First State Capital Investments, Incorporated," the "Company," "we," "our" or "us" means First State Capital Investments, Incorporated.


FORWARD LOOKING STATEMENTS


There are statements in this quarterly report that are "forward-looking statements" and they can be identified by use of terminology such as "believe," "hope," "may," "might," "anticipate," "should," "intend," "plan," "will," "expect," "estimate," "project," "positioned," "strategy" and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that are beyond our control. For a discussion of these risks, you should read this entire quarterly report carefully, especially the risks discussed under "Risk Factors."  Although management believes that the assumptions underlying the forward looking statements included in this quarterly report are reasonable, they do not guarantee our future performance and actual results could differ from those contemplated by these forward looking statements.  The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry and other circumstances.  As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment.  To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements.  In the light of these risks and uncertainties, there can be no assurance that the results and events contemplated by the forward-looking statements contained in this quarterly report will in fact transpire.  You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.  We do not undertake any obligation to update or revise any forward-looking statements.
























ii






PART 1 - FINANCIAL INFORMATION


Item 1.  Financial Statements



First State Capital Investments, Incorporated

(A Development Stage Company)

BALANCE SHEETS

As Of August 31, 2013 (Unaudited) And February 28, 2013 (Audited)





 

 

 

August 31, 2013

February 28, 2013

 

ASSETS

 

 

 

 

  Current Assets

 

 

 

 

    Cash

 

$200

$200

 

  Total Current Assets

 

$200

$200

 

TOTAL ASSETS

 

$200

$200

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS EQUITY

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

  Current Liabilities

 

-

-

 

  Long Term Liabilities

 

-

-

 

TOTAL LIABILITIES

 

-

-

 

 

 

 

 

 

STOCKHOLDERS EQUITY

 

 

 

  Preferred Stock (1)

 

-

-

 

  Common Stock (2)

 

$200

$200

 

  Additional Paid In Capital

 

$7,699

$4,349

 

  Retained Earnings (Accumulated Deficit)

($7,699)

($4,349)

 

TOTAL STOCKHOLDERS EQUITY

$200

$200

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS EQUITY

$200

$200

 

 

 

 

 

 

(1) Preferred Stock, $0.001 par value, 50,000,000 shares authorized, -0- shares issued and outstanding

(2) Common Stock, $0.001 par value, 100,000,000 shares authorized, 200,000 shares issued and outstanding


See the accompanying summary of accounting policies and notes to the financial statements.


F-1









5





FIRST STATE CAPITAL INVESTMENTS, INCORPORATED

(A Development Stage Company)

STATEMENT OF OPERATIONS (Unaudited)

FOR THE THREE MONTHS ENDED AUGUST 31, 2013 AND AUGUST 31, 2012,

FOR THE SIX MONTHS ENDED AUGUST 31, 2013 AND AUGUST 31, 2012

AND FOR THE PERIOD JANUARY 30, 2012 (INCEPTION) THROUGH AUGUST 31, 2013









 

Three Months Ended August 31, 2013

Three Months Ended August 31, 2012

Six Months Ended August 31, 2013

Six Months Ended August 31, 2012

January 30, 2012 (Inception) Through August 31, 2013

REVENUES

 

 



 

  Revenue

-

-

-

-

-

TOTAL REVENUES

-

-

-

-

-

 

 

 



 

EXPENSES

 

 



 

  Expenses

$850

$735

$3,350

$2,750

$7,699

TOTAL EXPENSES

$850

$735

$3,350

$2,750

$7,699

 

 

 



 

NET PROFIT OR (LOSS)

($850)

($735)

($3,350)

($2,750)

($7,699)

 

 

 



 

NET PROFIT OR (LOSS) PER COMMON SHARE

($0.00)

($0.00)

($0.02)

($0.01)

 ($0.04)

 

 

 



 

PER SHARE INFORMATION

 

 



 

  Earnings Per Share of Common Stock

($0.00)

($0.00)

($0.02)

($0.01)

 ($0.04)

  Weighted Average Number of Shares of Common Stock Outstanding

200,000

200,000

200,000

200,000

 200,000


See the accompanying summary of accounting policies and notes to the financial statements.


F-2












6









FIRST STATE CAPITAL INVESTMENTS, INCORPORATED

(A Development Stage Company)

STATEMENT OF CASH FLOWS (Unaudited)

FOR THE FOR THE SIX MONTHS ENDED AUGUST 31, 2013 AND AUGUST 31, 2012

AND FOR THE PERIOD JANUARY 30, 2012 (INCEPTION) THROUGH AUGUST 31, 2013







 

Six Months Ended August 31, 2013

Six Months Ended August 31, 2012

January 30, 2012 (Inception) Through August 31, 2013

CASH FLOW FROM OPERATING ACTIVITIES

 

 

 

  Profit or (Loss)

($3,350)

($2,750)

($7,699)

NET CASH FLOW USED IN OPERATING ACTIVITIES

($3,350)

($2,750)

($7,699)

 

 

 

 

CASH FLOW FROM FINANCING ACTIVITIES

 

 

 

  Cash Proceeds From Issuance of Common Stock to Incorporators

-

-

$200

  Expenses Paid by Related Party

$3,350

$2,750

$7,699

NET CASH PROVIDED BY FINANCING ACTIVITIES

$3,350

$2,750

$7,899

 

 

 

 

NET INCREASE (DECREASE) IN CASH

-

-

$200

 

 

 

 

CASH AND CASH EQUIVALENTS BEGINNING OF PERIOD

$200

$200

-

 

 

 

 

CASH AND CASH EQUIVALENTS END OF PERIOD

$200

$200

$200

 

 

 

 

SUPPLEMENTAL INFORMATION

 

 

 

  Interest Paid

-

-

-

  Taxes Paid

-

-

-


See the accompanying summary of accounting policies and notes to the financial statements.


F-3














7







First State Capital Investments, Incorporated

(A Development Stage Company)

Notes to Financial Statements

August 31, 2013




Note 1- Basis of Presentation


The accompanying financial statements of First State Capital Investments, Incorporated (the "Company") were prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC") and reflect all normal recurring adjustments that are, in the opinion of management, necessary for a fair statement of the financial position of First State Capital Investments, Incorporated for the period ended August 31, 2013.  The results of operations for interim periods are not necessarily indicative of the results of operations that could be expected for the full year.  Certain information and disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to such rules and regulations.  These unaudited interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the period ended February 28, 2013.  We believe that these financial statements contain all adjustments necessary to present fairly the position and results of operations of the Company for the respective periods.


In preparing financial statements, the Company's management makes informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period.  We review our estimates on an on-going basis, including those related to contingencies and income taxes.  Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates.

 

Note 2 - Description of Business


First State Capital Investments, Incorporated was incorporated in the State of Delaware on January 30, 2012.  The Company was formed to pursue a business combination with a target business opportunity yet to be finalized and to provide a method for a domestic or foreign private company to become a reporting company whose securities may qualify for trading in the United States secondary market.  As of this date the company has not identified a possible business combination opportunity, has not reached terms with a possible business combination and has not issued nor entered into a letter of intent with or concerning any target business opportunity.  The Company has been in the developmental stage since inception and has no other operations to date other than issuing shares to our original shareholders and incorporators, Media Services, Incorporated and Enterprise Creations, LLC.  The Company has generated no revenue, has generated no income or cash flow and lacks committed funding: these factors raise substantial doubt about the Company's ability to continue as a going concern.


First State Capital Investments, Incorporated is a "blank check" company within the meaning of Section 3(a)(51) of the Exchange Act of 1934, as amended, (the "Exchange Act").  We also qualify as a "shell company", further to SEC Rule 12b-2 of the Securities Act of 1933, as amended (the "Securities Act"), because we have no or nominal operations and no or nominal assets and our assets consist solely of cash and cash equivalents.


During this reporting period (June 1, 2013 August 31, 2013) the Company and its management were involved in identifying and pursuing possible business combinations with target business opportunities.  As of this date, the company has not identified a target business opportunity and has not issued nor entered into a letter of intent concerning any target business opportunity.


8




Note 3 - Preparation and Basis of Financial Statements

The Company follows the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("GAAP").  The preparation of financial statements in conformity with GAAP 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 revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud.  The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

The Company's fiscal year-end is February 28.


Note 4 - Summary of Significant Accounting Policies


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 disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.


Cash and Equivalents

The Company considers all highly liquid investments with original maturities from date of purchase of three months or less to be cash equivalents.  Cash and equivalents consist of cash on deposit with domestic banks and, at times, may exceed federally insured limits. As of August 31, 2013, there was $200 in the Company's checking account and no cash equivalents.


Income Taxes

The Company has adopted the provisions of ASC 740, "Accounting for Income Taxes" which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns.  Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.


Net Income (Loss) Per Share

Basic net income (loss) per common share amounts is computed using the weighted average number of common shares outstanding during the year.  Diluted per common share amounts are computed using the weighted average number of common shares outstanding during the year and dilutive potential common shares.  Dilutive potential common shares consist of stock options, stock warrants and redeemable convertible stock and are calculated using the treasury stock method.  As of February 28, 2013, there were no dilutive convertible common shares outstanding.


Development Stage - First State Capital Investments, Incorporated

As a result of the Company's limited operating history and lack of current revenue stream we report our financial statements pursuant to FASB statement number 7, which focuses on development stage companies.  Users of the financial statements should be familiar with these statements and its effect on the financial statements.


9





Recent Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, to improve the transparency of reporting these reclassifications. Other comprehensive income includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. The amendments in the ASU do not change the current requirements for reporting net income or other comprehensive income in financial statements. All of the information that this ASU requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. The new amendments will require an organization to:


Present (either on the face of the statement where net income is presented or in the notes) the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income - but only if the item reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period; and


Cross-reference to other disclosures currently required under U.S. GAAP for other reclassification items (that are not required under U.S. GAAP) to be reclassified directly to net income in their entirety in the same reporting period. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., inventory for pension-related amounts) instead of directly to income or expense.


The amendments apply to all public and private companies that report items of other comprehensive income. Public companies are required to comply with these amendments for all reporting periods (interim and annual). The amendments are effective for reporting periods beginning after December 15, 2012, for public companies. Early adoption is permitted. The adoption of ASU No. 2013-02 is not expected to have a material impact on our financial position or results of operations.


In January 2013, the FASB issued ASU No. 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities, which clarifies which instruments and transactions are subject to the offsetting disclosure requirements originally established by ASU 2011-11. The new ASU addresses preparer concerns that the scope of the disclosure requirements under ASU 2011-11 was overly broad and imposed unintended costs that were not commensurate with estimated benefits to financial statement users. In choosing to narrow the scope of the offsetting disclosures, the Board determined that it could make them more operable and cost effective for preparers while still giving financial statement users sufficient information to analyze the most significant presentation differences between financial statements prepared in accordance with U.S. GAAP and those prepared under IFRSs. Like ASU 2011-11, the amendments in this update will be effective for fiscal periods beginning on, or after January 1, 2013. The adoption of ASU 2013-01 is not expected to have a material impact on our financial position or results of operations.


In October 2012, the FASB issued Accounting Standards Update ASU 2012-04, Technical Corrections and Improvements in Accounting Standards Update No. 2012-04. The amendments in this update cover a wide range of Topics in the Accounting Standards Codification. These amendments include technical corrections and improvements to the Accounting Standards Codification and conforming amendments related to fair value measurements. The amendments in this update will be effective for fiscal periods beginning after December 15, 2012. The adoption of ASU 2012-04 is not expected to have a material impact on our financial position or results of operations.



10







In August 2012, the FASB issued ASU 2012-03, Technical Amendments and Corrections to SEC Sections: Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin (SAB) No. 114, Technical Amendments Pursuant to SEC Release No. 33-9250, and Corrections Related to FASB Accounting Standards Update 2010-22 (SEC Update) in Accounting Standards Update No. 2012-03. This update amends various SEC paragraphs pursuant to the issuance of SAB No. 114. The adoption of ASU 2012-03 is not expected to have a material impact on our financial position or results of operations.


In July 2012, the FASB issued ASU 2012-02, Intangibles Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment in Accounting Standards Update No. 2012-02. This update amends ASU 2011-08, Intangibles Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment and permits an entity first to assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with Subtopic 350-30, Intangibles - Goodwill and Other - General Intangibles Other than Goodwill. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted, including for annual and interim impairment tests performed as of a date before July 27, 2012, if a public entitys financial statements for the most recent annual or interim period have not yet been issued or, for nonpublic entities, have not yet been made available for issuance. The adoption of ASU 2012-02 has not had a material impact on our financial position or results of operations.


In December 2011, the FASB issued ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05. This update defers the requirement to present items that are reclassified from accumulated other comprehensive income to net income in both the statement of income where net income is presented and the statement where other comprehensive income is presented. The adoption of ASU 2011-12 has not had a material impact on our financial position or results of operations.


In December 2011, the FASB issued ASU No. 2011-11 Balance Sheet: Disclosures about Offsetting Assets and Liabilities (ASU 2011-11). This Update requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The objective of this disclosure is to facilitate comparison between those entities that prepare their financial statements on the basis of U.S. GAAP and those entities that prepare their financial statements on the basis of IFRS. The amended guidance is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. The Company is currently evaluating the impact, if any, that the adoption of this pronouncement may have on its results of operations or financial position.


Note 5 - Going Concern


First State Capital Investments, Incorporated does not meet the test of "going concern;" instead the corporation was formed to pursue a business combination with target business opportunity yet to be finalized and to provide a method for a domestic or foreign private company to become a reporting company whose securities may qualify for trading in the United States secondary market.  As of this date the Company has not finalized a business combination and there can be no assurances that we will be successful in locating or negotiating with any target business opportunity and, as such, the Company has been in the developmental stage since inception and have no other operations to date other than issuing shares to our original shareholders (the incorporators).  The Companys financial statements have been prepared on a development stage company basis.  Substantial doubt exists as to the Companys ability to continue as a going concern.  No adjustment has been made to these financial statements for the outcome of this uncertainty.


11






Note 6 Fair Value of Financial Instruments

Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements.  This Statement reaffirms that fair value is the relevant measurement attribute.  The adoption of this standard did not have a material effect on the Companys financial statements as reflected herein.  The carrying amounts of cash, accounts payable and accrued expenses reported on the balance sheet are estimated by management to approximate fair value primarily due to the short-term nature of the instruments.  The Company had no other items that required fair value measurement on a recurring basis.

The Companys financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy.  The three levels are as follows:

Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

The following table provides a summary of the fair values of assets and liabilities:






 

 

Fair Value Measurements At

August 31, 2013

Carrying Value

 August 31, 2013

Level 1

Level 2

Level 3

$0

$0

$0

$0

$0



Note 7 - Share Capital


On February 27, 2012, First State Capital Investments, Incorporated issued 100,000 shares of its Common Stock, par value $0.001, to Media Services, Incorporated, incorporator, in exchange for $100.


On February 27, 2012, First State Capital Investments, Incorporated issued 100,000 shares of Common Stock, par value $0.001, to Enterprise Creations, LLC, incorporator, in exchange for $100.


On August 31, 2013, the Company's stock register reports a total 200,000 shares of Common Stock, par value $0.001, outstanding, with 100,000 shares held and owned by Media Services, Incorporated, incorporator and 100,000 shares held and owned by Enterprise Creations, LLC, incorporator.


Note 8 - Related Party Transactions


On February 27, 2012, First State Capital Investments, Incorporated issued 100,000 shares of its Common Stock, par value $0.001, to Media Services, Incorporated, incorporator, in exchange for $100.


On February 27, 2012, First State Capital Investments, Incorporated issued 100,000 shares of Common Stock, par value $0.001, to Enterprise Creations, LLC, incorporator, in exchange for $100.





12






Note 9 - Preferred Stock


The Company's Articles of Incorporation authorize 50,000,000 shares of Preferred Stock, par value $0.001.  


The Company's Preferred Stock has not been registered with the SEC.


The Company has not issued any shares of Preferred Stock.


Note 10 - Subsequent Events


There were no subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission.


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


a.  Full fiscal years

First State Capital Investments, Incorporated was organized as a vehicle to investigate and, if such investigation warrants, combine with a target business opportunity seeking the perceived advantages of being a publicly held corporation.  We have been and remain in the developmental stage since inception and have no other operations to date other than issuing shares to our original shareholders.  The Company has no operations, no revenues, no employees, no operating expenses and does not currently engage in any business activity that provides funds or cash flow.  The Company does not meet the test of "going concern" and the Company's independent auditor has expressed substantial doubt about the Company's ability to continue as a going concern due to our lack of committed funding and lack of revenue.


The Company's fiscal year ends February 28.  For the most recently audited period, February 29, 2012 and ending February 28, 2013 the Company had:


(a) Generated no revenues or earnings from operations,

(b) Possessed no significant assets or financial resources, and

(c) Had only $200 cash on hand.


For the fiscal quarter of this filing (June 1, 2013 August 31, 2013), the Company had:

(a) Generated no revenues or earnings from operations,

(b) Possessed no significant assets or financial resources, and

(c) Had only $200 cash on hand.


b. Liquidity and Capital Resources

As of August 31, 2013, the Company had a total of $200 in assets and no liabilities.  Since inception (January 30, 2012) the Company has only received $200 in capital from its two (2) stockholders/incorporators and has received no other funding or capital resources.  The Company is dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company.  To date, we have had no discussions with our stockholders, incorporators or other investors regarding funding and we have no funding commitment or written agreement for future expenses.  The Company can provide no assurance that it can continue to satisfy its cash requirements for at least the next twelve months.  If continued funding and capital resources are unavailable at reasonable terms, the Company may not be able to implement its plan of operations and may have to cease operations.


13





During the next 12 months the Company anticipates incurring an estimated $5,000 for accounting related expenses, costs of filing Exchange Act reports and costs related to consummating a business combination.  The Company's present 'burn rate' is approximately $5,000 annually for anticipated accounting related expenses, filing of Exchange Act reports and costs related to a business combination; therefore, the Company will be out of money next quarter without additional funding.  The Company does not currently engage in any business activities that provide funds or cash flow.  As of August 31, 2013, the cash balance in the Company's treasury (bank account) was $200 USD.  The Company plans to pay the anticipated costs related to accounting, investigating and analyzing business combinations and filing of Exchange Act reports during the next 12 months with money in our treasury and additional amounts, if necessary, as may be loaned to or invested in the Company by our stockholders, management or other investors.  The Company presently has no need to and has no plans to seek additional funds; the Company has had no discussions with stockholders, management or other investors regarding funding and no funding commitment for future expenses has been obtained.  If in the future the Company needs funds to pay expenses, the Company will consider these and other yet to be identified options for raising funds and/or paying expenses.  If we are not able to obtain additional funding, the amount of cash in our treasury will run out in or about December 31, 2013.  In the event that the money in our treasury ran out and we failed to obtain additional funding, we might have to cease operations.


To meet its future financial needs, the Company will aggressively seek to obtain capital either through loans, notes payable, through the issuance of shares of its common or preferred stock or other yet to be identified options.  We have had no discussions with internal or external sources of liquidity or capital including stockholders, management or other investors regarding funding and no funding commitment has been obtained.  The Company has not negotiated the terms of any capital raising activity; at the present time, the terms, conditions, amounts, price, and other details relating to potential sources of capital cannot be determined.  Future capital raising activity will be substantially limited given current market conditions and will in all likelihood be restricted to existing stockholders, management or other individuals or entities.


Regardless of any terms agreed upon between the Company and any investor, the need for future capital in order for the Company to continue its plan of operations is inevitable.  Current economic conditions will impact the Company's ability to raise capital.  Business and consumer concerns over the economy, geopolitical issues, the availability and cost of credit, the U.S. financial markets and the national debt have contributed to the volatility in the financial and economic environments.  These factors, combined with declining and failing businesses, reduced consumer confidence and increased unemployment, have caused a global economic slow-down.  Changes in national as well as global economic conditions, including changes in financial and equity markets, interest rates, and investors' perception of the economy may impede the Company's access to, or increase the cost of financing activities.


The Company will be in competition for capital with other entities that have identifiable assets, liquidity and revenue producing operations.  Our financial position, having no significant assets, financial resources and no revenues, raises substantial doubt about our ability to raise capital and continue as a going concern. The lack of a market for our common equity securities precludes us from raising capital in the equity markets until shares of our common stock are registered pursuant to or exempt from registration under the Securities Act; and, any other applicable federal or state securities laws or regulations may also preclude us from successfully raising capital and improving our financial position.  Target firms that might consider a merger or acquisition with us, to gain the advantages and perceived benefits of becoming a public corporation, may decide to forgo such a business combination with us because of our lack of operations and access to affordable capital.  Our financial position and current economic volatility may prevent us from identifying and pursuing a business combination with a target company seeking these benefits and funding sources, such as our shareholders, management or others, may decide to defer loans or investments to the Company.




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The financial statements contained in this interim report have been prepared assuming that the Company will continue as a going concern; however, the Company has not engaged in any operations that have produced revenue and, as a result, the possibility exists that the Company will not be able to continue as a going concern.  Nevertheless, management believes that sufficient funding is available to meet the Company's needs during the next twelve months.  The financial statements included in this interim report do not include any adjustments that might result from an unfavorable outcome of this uncertainty.


The Company has no material commitments for capital expenditures as of August 31, 2013, the latest fiscal period. The Company has no requirement for funds to fulfill such commitments.


There are no known material trends, favorable or unfavorable, in the Company's capital resources.


The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Companys financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.


Contractual Obligations









 

 

 

Payments due by period

 

 

Contractual Obligations

Total

Less than 1 year

1-3 years

3-5 years

More than 5 years

 

Long-Term Deb Obligations

-

-

-

-

-

 

Capital Lease Obligations

-

-

-

-

-

 

Operating Lease Obligations

-

-

-

-

-

 

Purchase Obligations

-

-

-

-

-

 

Other Long-Term Liabilities Reflected on the Registrants Balance Sheet under GAAP

-

-

-

-

-

 

Total

-

-

-

-

-

 


 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

First State Capital Investments, Incorporated is a smaller reporting company and is not required to provide information required by this item.


Item 4.  Controls and Procedures

We maintain disclosure controls and procedures that are designed to be effective in providing reasonable assurance that information required to be disclosed in our reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure.


In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute assurance of achieving the desired objectives.  Also, 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.


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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, 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.  The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.


As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of management, including our chief executive officer and principal financial officer of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act.  Based upon that evaluation, management concluded that our disclosure controls and procedures are effective to cause the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by SEC, and that such information is accumulated and communicated to management, including our chief executive officer and principal financial officer (one individual), as appropriate, to allow timely decisions regarding required disclosure.


Changes in internal controls.

There were no changes in our internal control over financial reporting (identified in connection with the evaluation required by paragraph (d) in Rules 13a-15 and 15d-15 under the Exchange Act) during our most recent fiscal quarter which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

There have been no legal proceedings or events under any bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any director, executive officer, promoter or control person of Company since its inception (January 30, 2012).

Item 1A.  Risk Factors

There have been no material changes to market risk factors described in the Company's Form 10-12(g) filings.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

On February 27, 2012, the Company issued 100,000 shares of its Common Stock, par value $0.001, at par value, to Media Services, Incorporated, incorporator, in exchange for $100 US Dollars.  No underwriter participated in the sale of these securities.  The Company sold these shares of Common Stock under the exemption from registration provided by Section 4(2) of the Securities Act.


On February 27, 2012, the Company issued 100,000 shares of its Common Stock, par value $0.001, at par value, to Enterprise Creations, LLC, incorporator, in exchange for $100 US Dollars.  No underwriter participated in the sale of these securities.  The Company sold these shares of Common Stock under the exemption from registration provided by Section 4(2) of the Securities Act. No securities have been issued for services rendered.  Neither the Company nor any person acting on its behalf offered or sold the securities by means of any form of general solicitation or general advertising.  No services were performed by a purchaser as consideration for the shares issued.



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All purchasers represented in writing that they acquired the securities for their own accounts.  A legend was placed on the stock certificates stating that the securities have not been registered under the Securities Act of 1933, as Amended, and cannot be sold or otherwise transferred without an effective registration or an exemption there from, and may not be sold pursuant to the exemptions provided by Section 4(1) of the Securities Act or Rule 144 under the Securities Act, in accordance with the letter from Richard K. Wulff, Chief of the Office of Small Business Policy of the Securities and Exchange Commission's Division of Corporation Finance, to Ken Worm of NASD Regulation, Inc., dated January 21, 2000.


There have been no unregistered sales of equity securities during the three-month period (June 1, 2013 August 31, 2013) of this report.

Item 3.  Defaults Upon Senior Securities

There have been no defaults upon senior securities.

Item 4.  Mine Safety Disclosures.

This Item 4 is not applicable to the Company.

Item 5.  Other Information

There have been no changes to the procedures by which security holders may recommend nominees to the registrants board of directors during the three-month period (June 1, 2013 August 31, 2013) of this report.

Item 6.  Exhibits

Exhibit Number and Description


3(i) Certificate of Incorporation; incorporated herein by reference to the Companys most recent Amended Form 10-12(g) filing.


3(ii) Bylaws; herein incorporated herein by reference to the Companys most recent Amended Form 10-12(g) filing


31(ii) Rule 13a-14/15d-14 Certifications


(100) XBRL-Related Documents


(101) Interactive Data File














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SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


First State Capital Investments, Inc.

(Registrant)


October 1, 2013

             /s/ Sallye W. Soltner

        Date

Sallye W. Soltner, CEO


October 1, 2013

/s/ William D. Kyle

        Date

William D. Kyle, CFO





















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Exhibit 31 (ii)

First State Capital Investments, Incorporated


CERTIFICATION REQUIRED BY

RULE 13a-14(b) OR RULE 15d-14(b)

AND 18 U.S.C. Section 1350


In connection with the Quarterly Report of First State Capital Investments, Inc. (the Company) on Form 10-Q for the fiscal quarter ended August 31, 2013 as filed with the US Securities and Exchange Commission on the date hereof (the Report), I, Sallye W. Soltner, President & Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350 that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

/s/ Sallye W. Soltner

Name: Sallye W. Soltner

Title: President & Chief Executive Officer

 

Dated: October 1, 2013


First State Capital Investments, Incorporated


CERTIFICATION REQUIRED BY

RULE 13a-14(b) OR RULE 15d-14(b)

AND 18 U.S.C. Section 1350


In connection with the Quarterly Report of First State Capital Investments, Inc. (the Company) on Form 10-Q for the fiscal quarter ended August 31, 2013 as filed with the US Securities and Exchange Commission on the date hereof (the Report), I, Sallye W. Soltner, President & Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350 that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ William D. Kyle

Name: William D. Kyle

Title: Chief Financial Officer


Dated: October 1, 2013



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