UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 2002
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the transition period from _________ to _________
Commission File No. 0-25611
PONTE NOSSA ACQUISITION CORP.
(Name of Small Business Issuer in Its Charter)
DELAWARE 33-0838660
(State of Incorporation) (IRS Employer Identification No.)
18271 McDurmott West, Suite A-1,
IRVINE, CA.
(Address of Principal Executive Offices)
92614
(Zip Code)
949-474-7020
(Issuer's Telephone Number)
As of September 30, 2002, the Company had 13,535,000 shares of its
common stock issued and outstanding.
Transitional Small Business Disclosure Format (check one): Yes No X
--- ---
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets at September 30, 2002 and September 30, 2001
Statements of Operations for the three and nine months ended September
30, 2002 and 2001 and the period April 21, 1997 (inception) to
September 30, 2002
Statements of Cash Flows for the nine months ended September 30, 2002
and 2001 and the period April 21, 1997 (inception) to September 30, 2002
Notes to Financial Statements
Item 2. Management's Discussion and Analysis or Plan of Operation
Item 3. Controls and Procedures
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets at September 30, 2002 and December 31, 2001 (Audited)
Statements of Operations for the three and nine months ended September
30, 2002 and 2001 and the period April 21, 1997(inception) to
September 30, 2002
Statements of Cash Flows for the nine months ended September 30,
2002 and 2001 and the period April 21, 1997 (inception) to
September 30, 2002
Notes to Financial Statements
PONTE NOSSA ACQUISITION CORP.
(A Development Stage Company)
Balance Sheets
(Unaudited)
September 30, December 31,
2002 2001 (audited)
------------ -------------
ASSETS
Current assets:
Cash $ 6,965 $ --
Notes receivable 373,075 --
------------ -------------
Total assets $ 380,040 $ --
============ =============
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accounts payable $ 2,582 $ 8,000
Due to related parties 200,241 51,583
Notes payable 357,179 --
------------ -------------
Total liabilities 560,002 59,583
------------ -------------
Shareholders' deficit
Preferred stock, 10,000,000 shares authorized,
$.001 par value, none issued and outstanding
at September 30, 2002 and December 31, 2001 -- --
Common stock, 20,000,000 shares authorized, $.001
par value, 13,535,000 and 13,000,000 shares
issued and outstanding at September 30, 2002
and December 31, 2001, respectively 13,535 13,000
Additional paid in capital 573,466 13,001
Deficit accumulated during development stage (766,963) (85,584)
------------ -------------
Shareholders' deficit (179,962) (59,583)
------------ -------------
Total liabilities and shareholders' deficit $ 380,040 $ --
============ =============
The accompanying notes are an integral part of these financial statements.
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PONTE NOSSA ACQUISITION CORP.
(A Development Stage Company)
Statements of Operations
(Unaudited)
Cumulative from
Inception
Three Months Ended Nine Months Ended (April 21, 1997)
Sepetember 30, September 30, to September 30,
----------------------------- ----------------------------- -------------
2002 2001 2002 2001 2002
------------- ------------- ------------- ------------- -------------
Interest income $ 3,105 $ -- $ 4,285 $ -- $ 4,285
------------- ------------- ------------- ------------- -------------
Expense
General and administrative expense 111,669 2,950 339,219 4,965 424,803
Investor settlement fee 336,000 336,000
Other expense
Interest expense 5,876 -- 10,445 10,445
------------- ------------- ------------- ------------- -------------
Total expense 117,545 2,950 685,664 4,965 771,248
------------- ------------- ------------- ------------- -------------
Net loss $ (114,440) $ (2,950) $ (681,379) $ (4,965) $ (766,963)
============= ============= ============= ============= =============
Net loss per common share - basic and diluted $ (0.0085) $ (0.0002) $ (0.0503) $ (0.0004)
============= ============= ============= =============
Basic and diluted weighted average
number of common shares outstanding 13,535,000 13,000,000 13,535,000 13,000,000
============= ============= ============= =============
The accompanying notes are an integral part of these financial statements.
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PONTE NOSSA ACQUSITIONS CORP.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
Cumulative From
Inception (April
Nine Months Ended 21, 1997) to
September 30, September 30,
----------------------- -------------
2002 2001 2002
---------- ---------- -------------
Cash flows from operating activities
Net loss $(681,379) $ (4,965) $ (766,963)
Adjustment to reconcile net loss to net
cash used by operating activities
Common stock issued in exchange for investor settlement fee 336,000 336,000
Accrued interest receivable (4,169) (4,169)
Accounts payable (5,418) -- 2,582
Accrued and other liabilities 10,320 -- 10,320
---------- ---------- -------------
Net cash used by operating activities (344,646) (4,965) (422,230)
---------- ---------- -------------
Cash flows from investing activities
Loan to VisiJet (368,906) -- (368,906)
---------- ---------- -------------
Net cash used in investing activities (368,906) -- (368,906)
---------- ---------- -------------
Cash flows from financing activities
Issuance of common stock 225,000 4,965 251,001
Proceeds from note payable 353,900 -- 353,900
Advance from related party 141,617 -- 193,200
---------- ---------- -------------
Net cash provided by financing activities 720,517 4,965 798,101
---------- ---------- -------------
Net increase in cash 6,965 -- 6,965
Cash, beginning of period -- -- --
---------- ---------- -------------
Cash, end of period $ 6,965 $ -- $ (329,035)
========== ========== =============
Supplemental disclosures of cash flow information
Investor settlement fee $ 336,000 $ 336,000
The accompanying notes are an integral part of these financial statements.
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Ponte Nossa Acquisition Corp.
Notes to Unaudited Financial Statements
September 30, 2002
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited financial statements of Ponte Nossa Acquisition
Corp. (the "Company") have been prepared in accordance with accounting
principles generally accepted in the United States of America for interim
financial information and the instructions to form 10-QSB. Accordingly,
they do not include all of the information and footnotes required by
accounting principles generally accepted in the United States of America
for complete financial statements. In the opinion of management, all
adjustments, consisting of normal recurring items, necessary for a fair
presentation have been included. Operating results for the three and nine
months ended September 30, 2002 are not necessarily indicative of the
results for any future period. These statements should be read in
conjunction with the Company's financial statements and footnotes thereto
included in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 2001.
NOTE 2 - BASIC AND DILUTED NET LOSS PER SHARE
Net loss per share is calculated in accordance with Statement of Financial
Accounting Standards 128, Earnings Per Share ("SFAS 128"), which
superseded Accounting Principles Board Opinion 15 ("APB 15"). Basic
earnings per share is calculated using the weighted-average number of
outstanding common shares during the period. Diluted earnings per share is
calculated using the weighted-average number of outstanding common shares
and dilutive common equivalent shares outstanding during the period, using
either the as-if-converted method for convertible notes and convertible
preferred stock or the treasury stock method for options and warrants. At
September 30, 2002 and 2001 there were no dilutive convertible shares,
stock options or warrants.
NOTE 3 - NOTES RECEIVABLE
In May 2002, the Company received $236,000 plus interest in a senior
promissory note from VisiJet, Inc., ("VisiJet"), a privately held
ophthalmic device company. The note was received in exchange for providing
working capital funding to VisiJet. The note balance plus accrued interest
is $238,970 as of September 30, 2002.
In August 2002, the Company entered into a Working Capital Loan Agreement
with VisiJet in order to facilitate the consummation of transactions
contemplated by the pending merger agreement. The Company agreed to loan
VisiJet up to an aggregate of $130,000 in the form of a promissory note at
10% interest per annum. The note balance plus accrued interest is $55,622
as of September 30, 2002.
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In August 2002, the Company entered into a Milestone Loan Agreement with
VisiJet in order to provide additional funding in contemplation of the
pending merger agreement. The Company agreed to loan VisiJet up to an
aggregate of $120,000 in the form of a promissory note at 10% interest per
annum. The note balance plus accrued interest is $78,483 as of September
30, 2002.
All of the notes plus accrued interest, which mature on the anniversary of
the dates issued are payable upon the earlier of i) the date of the
closing of the transactions of the merger agreement by and between the
Company and VisiJet, ii) termination of the merger agreement, iii) sale of
the Company or iv) the maturity date. The recoverability of the notes is
evaluated at least annually considering the projected future cash flow of
VisiJet.
NOTE 4 - NOTES PAYABLE
In May 2002, the Company issued a senior secured promissory note in the
aggregate principal amount of $236,000, receiving net proceeds of
$236,000. Interest on the note is stated at 3% per annum.
In August 2002, the Company issued another senior secured promissory note
in the aggregate principal amount of $250,000 to the holder of the senior
secured promissory note described above. The Company received $117,900 of
the total note proceeds as of September 30, 2002 . Interest on the note is
stated at 3% per annum.
The net proceeds from both of the notes were subsequently loaned to
VisiJet in order to fund the working capital requirements of VisiJet as
set forth in VisiJet's budget (see Note 3). Principal and accrued interest
on the notes are payable on the earlier of i) the date of which the
closing of the transactions of the merger agreement by and between the
Company and VisiJet, ii) termination of the merger agreement, iii) sale of
the Company or iv) the maturity date in May 2003. The notes are
collateralized by a security interest in certain assets and common stock
of the Company.
As of September 30, 2002, total senior secured promissory notes payable
amount to $357,179, including accrued interest of $3,279.
NOTE 5 - STOCKHOLDERS' EQUITY
In April 2002, the Company issued 300,000 shares of restricted common
stock to an investor in consideration for the investor's cancellation of a
warrant to purchase 5,500,000 shares of the Company's common stock for
$100,000 dated October 26, 2001. The Company valued the common stock based
on the market price as of the close of business on April 9, 2002. As a
result of the settlement, the Company incurred total investor fees expense
of $336,000.
In May 2002, the Company completed a private placement offering of common
stock and warrants with a single investor. The private placement raised
$150,000 (less $15,000 in expenses). The investor received 135,000 shares
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of common stock and warrants to purchase an additional 135,000 common
shares. The initial exercise price of the warrants is $2.50 per share,
escalating at a rate of $0.50 per share over a five year term.
In August 2002, the Company completed another private placement offering
of common stock and warrants with a single investor. The private placement
raised $100,000 (less $10,000 in expense). The investor received 100,000
shares of common stock and warrants to purchase an additional 100,000
common shares. The initial exercise price of the warrants is $2.50 per
share, escalating at a rate of $0.50 per share over a five year term.
The proceeds from the above transactions were used for general working
capital, administrative expenses, legal and accounting fees.
NOTE 6 - RELATED PARTY TRANSACTIONS
The Company's largest shareholder, Financial Entrepreneurs Incorporated
("FEI"), has funded certain expenditures of the Company. On April 14,
2002, the Company entered into a Promissory Note with FEI for amounts
loaned to the Company bearing an interest rate of 7.5% per annum. As of
September 30, 2002, current due to related parties in the Company's
balance sheet amounts to $200,241, including accrued interest of $7,041.
NOTE 7 - GOING CONCERN
The accompanying financial statements have been prepared in conformity
with accounting principles generally accepted in the United States of
America, which contemplate continuation of the Company as a going concern.
Additional capital infusion is necessary in order to fund current
expenditures, acquire business opportunities and achieve profitable
operations. This factor raises substantial doubt about the Company's
ability to continue as a going concern.
The Company's management intends to continue funding current expenditures
by means of contributions to capital and to raise additional funds through
equity offerings. However, there can be no assurance that management will
be successful in this endeavor.
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Item 2. Management's Discussion and Analysis or Plan of Operation.
The Company was formed on April 21, 1997. The Company has been inactive
and has had no significant operations. The Company is authorized to do any legal
business activity permitted by Delaware law. The Company is classified as a
development stage company because its principal activities involve seeking to
acquire business opportunities.
In August 2002 the Company completed a private placement of common
shares and warrants for $100,000 with a single investor. The investor received
100,000 shares of common stock and warrants exercisable at $2.50 per share over
the term. The term of the warrant is for five years, and the price escalates at
the rate of $0.50 per year.
The Company used the proceeds for general working capital,
administrative expenses, legal and accounting fees.
Also in August 2002 the Company received $117,900 in proceeds in
connection with the issuance of a secured promissory note in the amount of
$250,000. This funding of $250,000 was provided by Wharton Equity Partners, a
New York based company specializing in emerging growth investments. The $117,900
was made available to VisiJet, Inc., a privately held ophthalmic device company,
to fund its continuing progress towards bringing its products to market and
completing its proposed merger with the Company. The remaining $132,100 in
proceeds from the note will be received by the Company based on the continuing
cash requirement needs of VisiJet, Inc.
The merger with VisiJet, Inc. continues to move forward and it is
expected to be completed in the next quarter, following regulatory and
shareholder approvals.
Item 3. Controls and Procedures.
Under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer, we conducted an evaluation of our
disclosure controls and procedures, as such term is defined under Rule 13a-14(c)
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), within 90 days of the filing date of this report. Based on this
evaluation, our Chief Executive Officer and the Chief Financial Officer
concluded that the Company's disclosure controls and procedures are effective.
Disclosure controls and procedures are designed to ensure that information
required to be disclosed in reports under the Exchange Act are processed and
reported within the time periods specified by law. The design of any such system
of controls is based in part on assumptions about the likelihood of future
events, and there can be no assurance that any such system of controls will
succeed in all circumstances.
Since the date of the evaluation described above, there have been no
significant changes in our internal controls or in other factors that could
significantly affect these controls.
9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Inapplicable
Item 2. Changes in Securities and Use of Proceeds.
In August 2002, the Company completed a private placement of common
shares and warrants for $100,000 with a single investor. The investor received
100,000 shares of common stock and warrants exercisable at $2.50 per share over
the term. The term of the warrant is for five years, and the price escalates at
the rate of $0.50 per year.
The Company believes the issuance was exempt from the registration
requirements of the Securities Act 1933 by reason of Section 4(2) thereof and
Regulation D thereunder.
Item 3. Defaults Upon Senior Securities.
Inapplicable.
Item 4. Submission of Matters to a Vote of Security Holders.
Inapplicable
Item 5. Other Information
Inapplicable
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibits are included herein:
99.1 Certification of Chief Executive Officer
99.2 Certification of Chief Financial Officer.
(b) No reports on Form 8-K were filed during the period
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
PONTE NOSSA ACQUISITION CORPORATION
Dated: November 14, 2002 /s/ Thomas F. DiMele
-------------------------------
By: Thomas F. DiMele
Its: President
/s/ Laurence Schreiber
-------------------------------
By: Laurence Schreiber
Its: Chief Financial Officer
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CERTIFICATION
I, Thomas F. DiMele, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Ponte Nossa
Acquisition Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we 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 us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
(b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and 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 our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 14, 2002
/s/ Thomas F. DiMele
---------------------------
Thomas F. DiMele, President
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CERTIFICATION
I, Laurence Schreiber, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Ponte Nossa
Acquisition Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we 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 us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
(b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and 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 our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 14, 2002
/s/ Laurence Schreiber
-------------------------------------------
Laurence Schreiber, Chief Financial Officer
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