-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PVqJVJVXlj5Efhgkq7L0U3aLkoXUiRPxBdSGWIIo2Rs2e30HGeNCkEYpGvYyEr3A DFl3LNQ/0wtFmtruKY6UCw== 0001144204-05-018707.txt : 20050613 0001144204-05-018707.hdr.sgml : 20050613 20050613124923 ACCESSION NUMBER: 0001144204-05-018707 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20050331 FILED AS OF DATE: 20050613 DATE AS OF CHANGE: 20050613 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CROWN PARTNERS INC CENTRAL INDEX KEY: 0000811036 STANDARD INDUSTRIAL CLASSIFICATION: [9995] IRS NUMBER: 880222660 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 033-11986-LA FILM NUMBER: 05891782 BUSINESS ADDRESS: STREET 1: 21800 OXNARD STREET STREET 2: SUITE 440 CITY: WOODLAND HILLS STATE: CA ZIP: 91367 BUSINESS PHONE: 8185986780 MAIL ADDRESS: STREET 1: 21800 OXNARD STREET STREET 2: SUITE 440 CITY: WOODLAND HILLS STATE: CA ZIP: 91367 FORMER COMPANY: FORMER CONFORMED NAME: STEINS HOLDINGS INC /NV/ DATE OF NAME CHANGE: 20000308 FORMER COMPANY: FORMER CONFORMED NAME: TELEMALL COMMUNICATIONS INC/NV DATE OF NAME CHANGE: 19960905 FORMER COMPANY: FORMER CONFORMED NAME: VEGAS VENTURES INC DATE OF NAME CHANGE: 19960905 10QSB 1 v20066_10qsb.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2005 OR [ ]TRANSITION REPORT UNDER SECTION 13 OF 15(D) OF THE EXCHANGE ACT OF 1934 From the transition period from ___________ to ____________. Commission File Number 33-11986-LA CROWN PARTNERS, INC. ----------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) Nevada 91-2008803 ------------------------------- ------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 20700 Ventura Boulevard, #227, Woodland Hills, California 91364 --------------------------------------------------------------- (Address of principal executive offices) (818) 887-7201 --------------------------- (Issuer's telephone number) N/A -------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark 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 [ ] As of March 31, 2005 there were 19,462,293 shares of Common Stock of the issuer outstanding. CROWN PARTNERS, INC. CONSOLIDATED BALANCE SHEET MARCH 31, 2005 (UNAUDITED) ASSETS Current assets Cash $ 133,768 ----------- Total current assets 133,768 Property and equipment, net -- $ 133,768 LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities Accounts payable and accrued expenses $ 582,079 Advances 327,908 ----------- Total current liabilities 909,987 ----------- Commitments and contingencies STOCKHOLDERS' DEFICIT: Convertible preferred stock, $10 par value, 10,000,000 shares authorized, no shares issued and outstanding -- Common stock, $.001 par value, 50,000,000 shares authorized, 19,462,293 shares issued and outstanding 19,462 Additional paid in capital 7,742,183 Accumulated deficit (8,537,864) ----------- Total Stockholders' Deficit (776,219) ----------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 133,768 =========== See accompanying notes to financial statements. CROWN PARTNERS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2005 AND 2004 (UNAUDITED) 2005 2004 ------------ ------------ Revenues $ 18,851 $ 31,945 Costs and Expenses: General and administrative 126,408 2,087,657 Interest expense 6,578 6,250 ------------ ------------ Operating loss (114,135) (2,061,962) Interest income -- 19,998 Forgiveness of debt -- 19,206 ------------ ------------ Net loss $ (114,135) $ (2,022,758) ============ ============ Net loss per share: Net loss basic and diluted $ (0.01) $ (0.15) ============ ============ Weighted average shares outstanding: Basic and diluted 19,462,293 13,584,491 ============ ============ See accompanying notes to financial statements. CROWN PARTNERS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2005 AND 2004 (UNAUDITED) 2005 2004 ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ (114,135) $(2,022,758) Adjustments to reconcile net deficit to cash used by operating activities: Depreciation and amortization 26,245 5,046 Bad debt -- -- Forgiveness of debt -- (19,206) Common stock for services -- 2,034,000 Net change in: Prepaid assets -- -- Accounts payable and accrued expenses 48,373 (109,202) Accounts payable related parties 17,271 -- ----------- ----------- CASH FLOWS USED IN OPERATING ACTIVITIES (22,246) (112,120) ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures -- (2,354) ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the sale of stock -- 380,000 Proceeds from notes payable -- 95,520 Payments on notes payable (30,000) -- Proceeds (payments) on advances -- (13,500) ----------- ----------- CASH FLOWS PROVIDED BY FINANCING ACTIVITIES (30,000) 462,020 ----------- ----------- NET INCREASE (DECREASE) IN CASH (52,246) 374,546 Cash, beginning of period 186,014 502 ----------- ----------- Cash, end of period $ 133,768 $ 348,048 =========== =========== SUPPLEMENTAL CASH FLOW INFORMATION Interest paid $ -- $ -- Income taxes paid $ -- $ -- NONCASH TRANSACTION: Conversion of advances for common stock $ -- $ -- See accompanying notes to financial statements. CROWN PARTNERS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited interim financial statements of Crown Partners, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's registration statement filed with the SEC on Form 10-KSB. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year December 31, 2004 as reported in Form 10-KSB, have been omitted. NOTE 2 - SUBSEQUENT EVENT On May 1, 2005, the landlord evicted Sanitec Services of Hawaii from its plant in Honolulu for past due rent. At the same time, the landlord locked the premises and has kept Sanitec from entering the premises, retrieving any property located there and keeping Sanitec from accessing and operating its machine. Sanitec is working to resolve this problem but if it cannot, it faces the loss of the machine used to process waste which would result in Sanitec having to cease operating completely. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS THIS REPORT CONTAINS FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE SET FORTH ON THE FORWARD LOOKING STATEMENTS AS A RESULT OF THE RISKS SET FORTH IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, GENERAL ECONOMIC CONDITIONS, AND CHANGES IN THE ASSUMPTIONS USED IN MAKING SUCH FORWARD LOOKING STATEMENTS. General Crown Partners, Inc. (the "Company"), formerly known as "Stein's Holdings, Inc." has been involved in several different businesses. At the present time, the Company is utilizing its limited capital to fund its operations as it seeks business opportunities. In November, 2001, the Company acquired Sanitec(TM) Services of Hawaii, Inc. ("SSH"), a privately held Hawaiian corporation, developed to engage in medical waste collection and treatment in Honolulu, Hawaii. The Company issued 1,333,334 shares of its common stock to the shareholder of SSH and SSH became a wholly owned subsidiary of the Company. The Company borrowed funds and used capital it raised in order to pay past and present obligations of SSH during the year ended December 31, 2004. The Company anticipates either borrowing money or raising additional capital during fiscal 2005 to continue to fund SSH's operations. In February, 2003, SSH began to engage in limited operations and has received minimal revenues to date. There can be no assurances that the operations will result in material revenues to SSH or that profitability will be achieved in the near term, if ever. In May, 2005, Sanitec was evicted from its premises in Honolulu by the landlord who has retained control of Sanitec's equipment. At the present time, Sanitec has ceased operations and is working to secure the release of its equipment by the landlord. The Company has two additional subsidiaries of which it is the majority shareholder: Micro Bio-Medical Waste Systems, Inc. ("MBWS") and Universal Services & Acquisitions, Inc. ("USV"), which it acquired in October, 2000. The Company owns 80% of MBWS, a Nevada corporation traded on the Electronic Bulletin Board under "MBWS." MBWS entered into an agreement to acquire SSH in November, 2003 which requires it to pay $550,000 to the Company and issue five percent (5%) of MBWS's common stock. MBWS has not paid the sums due and the transaction has not closed. The Company owns 90% of the issued and outstanding shares of Universal Services & Acquisitions, Inc., a Colorado corporation. USV is a dormant shell company. Employees As of March 31, 2005, the Company had no employees. SSH had one employee as of March 31, 2005. RESULTS OF OPERATIONS For the three months ended March 31, 2005, the Company realized a loss of ($114,135) on revenues of $18,851 and general and administrative expenses of approximately $126,500. For the three months ended March 31, 2004, the Company realized a loss of approximately ($2,061,962) on revenues of approximately $32,000 and general and administrative expenses of approximately $2,100,000 and interest expenses of approximately $6,250. The Company's net loss from continuing operations before income taxes for the three months ended March 31, 2005 was ($114,135) compared to a net loss of ($2,061,962) for the three months ended March 31, 2004. The net loss per share for the periods ended March 31, 2005 and 2004 were nil and ($0.15), respectively. At March 31, 2005, shareholders' (deficit) totaled approximately ($8,500,000) compared to shareholders' (deficit) of approximately ($8,400,000) at December 31, 2004. LIQUIDITY AND CAPITAL RESOURCES At March 31, 2005, the Company had negative working capital of approximately ($776,000). At March 31, 2005, the Company had current assets of approximately $134,000 which consisted of cash. The current liabilities of the Company at March 31, 2005 were approximately $910,000 which consisted of approximately $582,000 in trade accounts payable/accrued expenses and advances of approximately $328,000. Crown will attempt to increase its operating liquidity by exploring the availability of outside debt and equity financing, to the extent that such funding is available under reasonable terms and conditions. There can be no assurances that these measures will result in an improvement in Crown's operations or liquidity. To the extent that Crown's operations or liquidity do not improve, Crown may be forced to reduce operations to a level consistent with its available working capital. As a result of these factors, Crown's independent accountants have expressed substantial doubt about Crown's ability to continue as a going concern. The accompanying consolidated financial statements have been prepared assuming that Crown will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The carrying amounts of assets and liabilities presented in the consolidated financial statements do not purport to represent the realizable or settlement values, nor do they include any adjustments that might result from the outcome of this uncertainty. NEED FOR ADDITIONAL FINANCING The Company believes that its existing capital may not be sufficient to meet the Company's cash needs, including the costs of compliance with the continuing reporting requirements of the Securities Exchange Act of 1934, as amended, for itself and its subsidiaries unless the Company increases its revenues or completes the proposed sale of certain of its subsidiaries. The Company is seeking to locate other potential acquisitions for its subsidiaries. No commitments to provide additional funds have been made by management or other stockholders. Accordingly, there can be no assurance that any funds will be available to the Company to allow it to cover its expenses. The Company might seek to compensate providers of services by issuances of stock in lieu of cash. The Company's balance sheet as of March 31, 2005 reflects limited assets and extensive liabilities. Further, there exists no agreements or understandings with regard to loan agreements by or with the Officers, Directors, principals, affiliates or shareholders of the Company. ITEM 3. CONTROLS AND PROCEDURES As required by Rule 13a-15 under the Exchange Act, as of the end of the period covered by this quarterly report, being March 31, 2005, we have carried out an evaluation of the effectiveness of the design and operation of our company's disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our company's management, including our company's President along with our company's Chief Financial Officer. Based upon that evaluation, our company's President along with our company's Chief Financial Officer concluded that our company's disclosure controls and procedures are effective as at the end of the period covered by this report. There have been no significant changes in our company's internal controls or in other factors, which could significantly affect internal controls subsequent to the date we carried out evaluation. Disclosure controls and procedures and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our President and Chief Financial Officer as appropriate, to allow timely decisions regarding required disclosure. PART II Items No. 1, 2, 3, 4, 5 - Not Applicable. Item No. 6 - Exhibits and Reports on Form 8-K (a) No reports on Form 8-K were filed during the three months ended March 31, 2005. (b) Exhibits None SIGNATURES In accordance with 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. CROWN PARTNERS, INC. By /s/ Charles Smith - -------------------------- Charles Smith, CEO, CFO Date: June 10, 2005 FORM OF CERTIFICATION PURSUANT TO RULE 13a-14 AND 15d-14 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED CERTIFICATION I, Charles Smith, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Crown Partners, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. As the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and I have: (a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this quarterly report (the "Evaluation Date"); and (c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on my evaluation as of the Evaluation Date; 5. As the registrant's certifying officer, I have disclosed, based on my most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls. 6. As the registrant's certifying officer, I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of my most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 10, 2005 /s/ Charles Smith ---------------------- Name: Charles Smith Title: CEO FORM OF CERTIFICATION PURSUANT TO RULE 13a-14 AND 15d-14 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED CERTIFICATION I, Charles Smith, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Crown Partners, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. As the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and I have: (a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this quarterly report (the "Evaluation Date"); and (c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on my evaluation as of the Evaluation Date; 5. As the registrant's certifying officer, I have disclosed, based on my most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls. 6. As the registrant's certifying officer, I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of my most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 10, 2005 /s/ Charles Smith --------------------- Name: Charles Smith Title: CFO CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Crown Partners, Inc. on Form 10-QSB for the period ended March 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacities and on the dates indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge: 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 operation of the Company. /s/ Charles Smith ----------------------- Charles Smith, Principal Accounting Officer Dated: June 10, 2005 -----END PRIVACY-ENHANCED MESSAGE-----