10QSB 1 q906.txt U. S. Securities and Exchange Commission Washington, D. C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2006 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from to Commission File No. 333-54002 HAN LOGISTICS, INC. ------------------- (Exact name of Small Business Issuer as specified in its Charter) NEVADA 88-0435998 ------ ---------- (State or Other Jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 5925 Starcrest Avenue Reno, Nevada 89523 --------------------- (Address of Principal Executive Offices) Issuer's Telephone Number: (775) 746-5156 Check whether the Registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter Period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes X No Applicable Only to Issuers Involved in Bankruptcy Proceedings During the Preceding Five Years Check whether the Registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Not applicable. Applicable Only to Corporate Issuers State the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest practicable date: September 30, 2006 - 2,073,700 shares of common stock. PART I - FINANCIAL INFORMATION Item 1. Financial Statements. The Financial Statements of the Registrant required to be filed with this 10- QSB Quarterly Report were prepared by management, and commence on the following page, together with Related Notes. In the opinion of management, the Financial Statements fairly present the financial condition of the Registrant for the periods then ended. HAN LOGISTICS, INC. (A Development Stage Company) CONDENSED BALANCE SHEETS As of September 30, 2006 and December 31, 2005 2006 2005 ASSETS CURRENT ASSETS: Cash $20,729 $46,331 ------- ------- Total Current Assets 20,729 46,331 ------- ------- PROPERTY AND EQUIPMENT, NET 1,516 - OTHER ASSETS Deposits and other - - ------- ------- Total Other Assets - - ------- ------- TOTAL ASSETS $22,245 $46,331 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT) CURRENT LIABILITIES: Accounts payable $37,627 $21,362 Accrued liabilities-Related parties 14,403 7,584 Notes payable-Related parties 37,587 37,587 ------- ------- Total Current Liabilities 89,617 66,533 ------- ------- Total liabilities 89,617 66,533 ------- ------- Commitments and Contingencies STOCKHOLDERS' EQUITY/(DEFICIT): Common stock, $.001 par value; 50,000,000 shares authorized; 2,073,700 shares issued and outstanding at September 30, 2006 and 2,053,500 shares issued and outstanding at December 31, 2005 2,074 2,054 Additional paid-in capital 78,228 58,048 Accumulated deficit during the development stage (147,674) (80,304) ------- ------- Total Stockholders' Equity/(Deficit) (67,372) (20,202) ------- ------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT) $22,245 $46,331 ======= ======= See accompanying notes to financial statements. HAN LOGISTICS, INC. (A Development Stage Company) CONDENSED STATEMENTS OF OPERATIONS Nine Months Ended September 30, 2006 and 2005 and the Three Months Ended September 30, 2006 and 2005 and From the Date of Inception(July 1, 1999) to September 30, 2006 Date of Inception (July 1, 1999) Nine Months Ended Three Months Ended to September 30, September 30, September 30 2006 2005 2006 2005 2006 Revenues $ - $ - $ - $ - $ 9,481 Revenues-Related party - - - - 1,200 --------- -------- ------- -------- ---------- Gross revenues - - - - 10,681 --------- -------- ------- -------- ---------- Operating Expenses: Depreciation and amortization 245 - 147 - 245 General and administrative expenses 64,306 9,292 25,369 3,303 147,016 --------- -------- ------- -------- ---------- Total operating expenses 64,551 9,292 25,516 3,303 147,261 --------- -------- ------- -------- ---------- Loss from Operations (64,551) (9,292) (25,516) (3,303) (136,580) Other Income/(Expense) Interest income - 1 - - 35 Interest (expense) (2,819) (1,584) (940) (687) (11,129) --------- -------- ------- -------- ---------- Total Other Income (Expense) (2,819) (1,583) (940) (687) (11,094) --------- -------- ------- -------- ---------- (Loss) from Continuing Operations (67,370) (10,875) (26,456) (3,990) (147,674) (Loss) from Discontinued operations - - - - - --------- -------- ------- -------- ---------- Loss before Income Taxes (67,370) (10,875) (26,456) (3,990) (147,674) Provisions for Income Taxes - - - - - --------- -------- ------- -------- ---------- Net (Loss) $ (67,370) $(10,875)$(26,456) $ (3,990) $ (147,674) ========= ======== ======= ======== ========== Net (Loss) Per Share: Basic and Diluted $(0.02) $(0.01) $(0.01) $(0.01) $(0.06) Weighted Average Shares Outstanding Basic and Diluted 2,065,705 2,000,000 2,073,700 2,000,000 2,007,118 ========= ========= ========= ========= ========= See accompanying notes to financial statements. HAN LOGISTICS, INC. (A Development Stage Company) CONDENSED STATEMENTS OF CASH FLOWS Nine Months Ended September 30, 2006 and 2005 and From the Date of Inception (July 1, 1999) to September 30, 2006 Date of Inception (July 1, 1999) Nine Months Ended to September 30, September 30, 2006 2005 2006 CASH FLOWS FROM OPERATING ACTIVITIES: Net income/(loss) $(67,370) $(10,875) $(147,674) Adjustments to reconcile net income/(loss) to net cash used in operating activities: Depreciation and amortization 245 - 245 Changes in assets and liabilities: Decrease in accounts receivable - 1,575 - Increase in accounts payable and accrued expenses 23,084 (3,074) 52,030 --------- -------- ---------- Net cash from operating activities (44,041) (12,374) (95,399) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of computer equipment (1,761) - (1,761) --------- -------- ---------- CASH FLOWS FROM FINANCING ACTIVITIES: Increase/(decrease) in notes payable - 13,700 37,587 (Increase) in stock issuance costs - - (20,398) Proceeds from issuance of common stock 20,200 - 100,700 --------- -------- ---------- Net cash from financing activities 20,200 13,700 117,889 --------- -------- ---------- Net increase (decrease) in cash (25,602) 1,326 20,729 CASH AT BEGINNING PERIOD 46,331 825 - --------- -------- ---------- CASH AT END OF PERIOD $ 20,729 $ 2,151 $ 20,729 ========= ======== ========== SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest $ - $ - $ - Cash paid for income taxes $ - $ - $ - See accompanying notes to financial statements. HAN LOGISTICS, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS September 30, 2006 (unaudited) NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS September 30, 2006 NOTE A - PRESENTATION The balance sheets of the Company as of September 30, 2006 and December 31, 2005, the related consolidated statements of operations for the three and nine months ended September 30, 2006 and 2005 and from the date of inception (July 1, 1999) of the development stage period through September 30, 2006, and the statements of cash flows for the nine months ended September 30, 2006 and 2005 and from the date of inception (July 1, 1999) of the development stage period through September 30, 2006, (the financial statements) include all adjustments (consisting of normal recurring adjustments) necessary to summarize fairly the Company's financial position and results of operations. The results of operations for the nine months ended September 30, 2006 are not necessarily indicative of the results of operations for the full year or any other interim period. The information included in this Form 10-QSB should be read in conjunction with Management's Discussion and Analysis and Financial Statements and notes thereto included in the Company's December 31, 2005, Form 10-KSB and the Company's Form 8-K and 8-K/A filings. NOTE B - REVENUE RECOGNITION The Company currently has no significant source of revenues. Revenue from the sale of goods or services is recognized when the significant risks and rewards of ownership are transferred to the buyer. NOTE C - DEVELOPMENT STAGE COMPANY Han Logistics, Inc. is a development stage company as of July 1, 1999 (Inception). The Company is subject to risks and uncertainties, including new product development, actions of competitors, reliance on the knowledge and skills of its employees to be able to service customers, and availability of sufficient capital and a limited operating history. Accordingly, the Company presents its financial statements in accordance with the accounting principles generally accepted in the United States of America that apply in establishing new operating enterprises. As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the accumulated statement of operations and cash flows from inception of the development stage to the date on the current balance sheet. Contingencies exist with respect to this matter, the ultimate resolution of which cannot presently be determined. NOTE D - STOCK ISSUANCE As of the date hereof, the Company has received a total of $73,700 under its offering. NOTE E - GOING CONCERN The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern. However, the Company was in default on its notes and various accounts payable, has not generated any operating revenue, has incurred significant operating losses to date, has a negative cash flow from operations and has working capital and stockholders' deficits, which raises substantial doubt about its ability to continue as a going concern. In view of these matters, realization of certain of the assets in the accompanying balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to meet its financial requirements, raise additional capital, and the success of its future operations. Management is attempting to raise additional capital and is seeking a business combination. Management believes that this plan provides an opportunity for the Company to continue as a going concern. Item 2. Management's Discussion and Analysis or Plan of Operation. -------------------------------------------------------------------- This Report contains forward-looking statements. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. Forward-looking statements usually contain the words "estimate," "anticipate," "believe," "expect," or similar expressions, and are subject to numerous known and unknown risks and uncertainties. In evaluating such statements, prospective investors should carefully review various risks and uncertainties identified in this Report, including the matters set forth in the Company's other SEC filings. These risks and uncertainties could cause the Company's actual results to differ materially from those indicated in the forward- looking statements. The Company undertakes no obligation to update or publicly announce revisions to any forward-looking statements to reflect future events or developments. Although forward-looking statements in this Quarterly Report on Form 10-QSB reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by us. Consequently, forward- looking statements are inherently subject to risks and uncertainties and actual results and outcomes may differ materially from the results and outcomes discussed in or anticipated by the forward-looking statements. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this Annual Report on Form 10- KSB. We file reports with the Securities and Exchange Commission ("SEC"). We shall make available, free of charge, our annual reports on Form 10-KSB, quarterly reports on Form 10-QSB, current reports on Form 8-K and amendments to those reports as soon as reasonably practicable after we electronically file such materials with or furnish them to the SEC. You can read and copy any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. You can obtain additional information about the operation of the Public Reference Room by calling the SEC at 1-800- SEC-0330. In addition, the SEC maintains an Internet site (www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including us. We undertake no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this Quarterly Report on Form 10-QSB. Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this quarterly report, which attempt to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations, and prospects. General Han Logistics, Inc. (the "Company") is currently a development stage company under the provisions of Statement of Financial Accounting Standards ("SFAS") No. 7. The Company was incorporated under the laws of the State of Nevada on July 1, 1999. Plan of Operations We propose to develop, market and deliver logistical analysis, problem-solving and other logistics services to business customers. Han Logistics is in the development stage and, to date, management has devoted substantially all of their time and effort to organizational and financing matters. Through the date hereof, we have not yet generated material service revenue and we have realized a net loss from operations. We did not generate any revenue during the quarter ended September 30, 2006 or the year December 31, 2005, and our net loss during the quarter ended September 30, 2006 was $(26,456). For the period from inception through September 30, 2006, we had total revenues of $10,681 and a net loss of $(147,674). Operating expenses for the quarter ended September 30, 2006, and the period from inception through September 30, 2006, totaled $25,516 and $147,261, respectively. As of the date hereof, we have sold a total of 73,700 shares of our common stock under our offering of 250,000 shares at a price of $1.00 per share, for gross proceeds of $73,700. We had expected that these offering proceeds would satisfy our cash requirements for at least the next year and that it would not be necessary, during that period, to raise additional funds to meet the expenditures required for operating our business. However, based on the current cost of operations we expect that we may have to raise additional capital either through loans or additional sales of securities during the next twelve months. We plan to employ a marketing specialist on a per project basis and a part- time bookkeeper with $9,000 of our offering proceeds. We do not anticipate the performance of any research and development during the next 12 months. There can be no assurance that we will achieve commercial acceptance for any of our proposed logistics services in the future; that future service revenue will materialize or be significant; that any sales will be profitable; or that we will have sufficient funds available for further development of our proposed services. The likelihood of our success will also depend upon our ability to raise additional capital from equity and/or debt financing to overcome the problems and risks described herein; to absorb the expenses and delays frequently encountered in the operation of a new business; and to succeed in the competitive environment in which we will operate. Although management intends to explore all available alternatives for equity and/or debt financing, including, but not limited to, private and public securities offerings, there can be no assurance that we will be able to generate additional capital. Our continuation as a going concern is dependent on our ability to generate sufficient cash flow to meet our obligations on a timely basis and, ultimately, to achieve profitability. Financial Condition, Capital Resources and Liquidity. ----------------------------------------------------- As of September 30, 2006, we had total cash assets of $20,729, which was derived from the proceeds of our stock offering. We had total current liabilities of $89,617 and working capital and stockholders' deficit of $(67,372) as of September 30, 2006. Deficits accumulated during the development stage totaled $(147,674). Our financial statements are presented on the basis that Han Logistics is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable length of time. However, our independent accountants have noted that the Company has accumulated losses from operations and has the need to raise additional financing in order to satisfy its vendors and other creditors and execute its business plan. These factors raise substantial doubt about our ability to continue as a going concern. Our future success will be dependent upon our ability to provide effective and competitive logistical analysis, problem-solving and other logistics services that meet customers' changing requirements. Should Han Logistics' efforts to raise additional capital through equity and/or debt financing fail, Amee Han Lombardi, our President/Secretary/Treasurer, is expected to provide the necessary working capital so as to permit Han Logistics to continue as a going concern. At September 30, 2006 the Company had no material operations and was still seeking capital through its stock offering in order to resume operations. At September 30, 2006 and through the date of this filing, the Company has yet to obtain any other commitments for additional funding or commence its business activity. As of the date hereof, the Company has received a total of $73,700 under its offering, and it has formally closed the offering, with no additional proceeds being raised, in the near future. However, the Company does not have enough working capital to continue its operations during the next twelve months and may have to raise additional capital either through loans or an additional offering of its securities. Until the Company obtains the capital required to develop any properties or businesses and obtains the revenues needed from its future operations to meet its obligations, the Company will depend on sources other than operating revenues to meet its operating and capital needs. Operating revenues may never satisfy these needs. Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors. Item 3. Controls and Procedures. As of the end of the period covered by this Quarterly Report, we carried out an evaluation, under the supervision and with the participation of our President and Secretary, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our President and Secretary concluded that information required to be disclosed is recorded, processed, summarized and reported within the specified periods and is accumulated and communicated to management, including our President and Secretary, to allow for timely decisions regarding required disclosure of material information required to be included in our periodic Securities and Exchange Commission reports. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and our President and Secretary have concluded that our disclosure controls and procedures are effective to a reasonable assurance level of achieving such objectives. However, it should be noted that 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, regardless of how remote. In addition, we reviewed our internal controls over financial reporting, and there have been no changes in our internal controls or in other factors in the last fiscal quarter that has materially affected our internal controls over financial reporting. PART II - OTHER INFORMATION Item 1. Legal Proceedings. None; not applicable. Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. None; not applicable. Item 3. Defaults Upon Senior Securities. None; not applicable. Item 4. Submission of Matters to a Vote of Security Holders. No matter was submitted to a vote of our Company's security holders during this quarterly period. Item 5. Other Information. None; not applicable. Item 6. Exhibits. 31 Certification of Amee Han Lombardi 32 302 Certification SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this Quarterly Report to be signed on its behalf by the undersigned, thereunto duly authorized. HAN LOGISTICS, INC. (Registrant) Dated: 11-14-06 /s/ Amee Han Lombardi ---------- ---------------------- Amee Han Lombardi, President/Secretary/Treasurer Dated: 11-14-06 /s/ Michael Vardakis --------- --------------------- Michael Vardakis Director