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EX-32.1 - EXHIBIT 32.1 - Portus Holdings Inc.v352789_ex32-1.htm
EX-31.1 - EXHIBIT 31.1 - Portus Holdings Inc.v352789_ex31-1.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

(Mark One)

 

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

 

For the quarterly period ended June 30, 2013

 

or

 

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

 

For the transition period from ______________ to ______________

 

Commission File Number: 000-54403

 

PORTUS HOLDINGS INC.

(Name of registrant as specified in its charter)

 

NEVADA 45-1283820
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

 

110 East Broward Blvd. Suite 1700

Fort Lauderdale, Florida 33301

(Address of principal executive offices) (Zip Code)

 

(954)778-8211

(Registrant's telephone number, including area code)

 

N/A

(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 preceding 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 ¨  No x

 

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 ¨  No  x

  

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 ¨   Small Reporting Company x

(Do not check if smaller reporting company)

 

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

 

As of August 12, 2013, there were 113,209,756 shares of common stock issued and outstanding.

 

 
 

 

TABLE OF CONTENTS

     
     
  PART I. - FINANCIAL INFORMATION  
    Page 
Item 1. Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 9
Item 3. Quantitative and Qualitative Disclosures About Market Risk. 10
Item 4. Controls and Procedures. 10
     
  PART II - OTHER INFORMATION  
    11
Item 1. Legal Proceedings. 11
Item 1A. Risk Factors. 11
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 11
Item 3. Defaults Upon Senior Securities. 11
Item 4. Mine Safety Disclosures. 11
Item 5. Other Information. 11
Item 6. Exhibits.  

 

2
 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

Certain statements in this quarterly report on Form 10-Q contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Generally, the words “believes”, “anticipates,” “may,” “will,” “should,” “expect,” “intend,” “estimate,” “continue,” and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements which include, but are not limited to, statements concerning the Company’s expectations regarding its working capital requirements, financing requirements, business prospects, and other statements of expectations, beliefs, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Readers should carefully review this quarterly report in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

 

3
 

 

PART 1 - FINANCIAL INFORMATION

 

Item 1.   Financial Statements. 

 

PORTUS HOLDINGS, INC.

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED BALANCE SHEETS

(unaudited)

             

   June 30,   December 31, 
   2013   2012 
ASSETS          
           
CURRENT ASSETS          
Cash  $-   $35,299 
Acquisition deposit   65,000    40,000 
TOTAL ASSETS  $65,000   $75,299 
           
LIABILITIES AND STOCKHOLDERS' EQUITY  (DEFICIT)          
           
CURRENT LIABILITIES          
           
Accounts payable  $21,800   $12,435 
Accrued expenses   2,589    - 
Bank overdraft   1,447      
Convertible debentures   75,000    - 
TOTAL CURRENT LIABILITIES   100,836    12,435 
           
STOCKHOLDERS' EQUITY (DEFICIT)          
Preferred stock, $0.0001 par value, authorized: 75,000,000 shares, Issued and outstanding: None   -    - 
Common stock, $0.0001 par value, authorized: 425,000,000 shares, Issued and outstanding:  113,043,526 and 112,967,500 shares issued and outstanding respectively   11,304    11,297 
Additional paid in capital   562,485    459,953 
Deficit accumulated during the development stage   (609,625)   (408,386)
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)   (35,836)   62,864 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)  $65,000   $75,299 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

4
 

  

PORTUS HOLDINGS, INC.

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

                   For the 
                   period from 
                   March 31, 
                   2011 
   For the three months ended June 30,   For the six months ended June 30,   (inception) to 
   2013   2012   2013   2012   June 30, 2013 
                     
Finance and accounting  $11,850   $-   $15,350   $-   $56,958 
Legal   1,363    -    21,674         47,424 
General and administrative   71,488    (2)   161,626    (4)   502,654 
Total operating expenses   84,701    (2)   198,650    (4)   607,036 
                          
Net operating  income (loss)   (84,701)   2    

(198,650

)  4   (607,036)
                          
Other income (expenses):                         
Interest expense   (1,517)   -    (2,589)   -    (2,589)
                          
Net income (loss)  $(86,218)  $2   $(201,239)  $4  $(609,625)
                          
NET LOSS PER SHARE                         
Basic and diluted  $(0.00)  $0.00  (0.00)  0.00  $n/a 
                          
WEIGHTED AVERAGE NUMBER OF SHARES                         
Basic and diluted   112,977,678    112,500,000    

112,992,684

    112,500    n/a 

 

The accompanying notes are an integral part of these unaudited financial statements.

 

5
 

 

Portus Holdings, Inc.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(unaudited)

 

           March 31, 2011 
   For the six months ended June 30,   (Inception) through 
   2013   2012   June 30, 2013 
CASH FLOWS FROM OPERATING ACTIVITIES:               
Net income (loss)  $(201,239)  $4   $(609,625)
                
Adjustments to reconcile net loss to net cash used in operating activities:               
        Stock based compensation   13,905         13,905 
Increase in accounts payable and accrued expenses   13,401    (4)   25,837 
NET CASH USED IN OPERATING ACTIVITIES   (173,933)   -    (569,883)
                
CASH FLOWS FROM INVESTING ACTIVITIES               
Cash paid for licensing agreement   (25,000)   -    (65,000)
NET CASH USED IN INVESTING ACTIVITIES   (25,000)   -    (65,000)
                
CASH FLOWS FROM FINANCING ACTIVITIES               
        Proceeds from  sale of convertible debentures   75,000         75,000 
Proceeds from sale of common stock   88,634         559,884 
NET CASH PROVIDED BY FINANCING ACTIVITIES   163,634    0    634,884 
                
INCREASE (DECREASE) IN CASH   (35,299)   0    1 
                
CASH, BEGINNING OF PERIOD   35,299    -    0 
                
CASH, END OF PERIOD  $0   $0   $1 
                
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:               
Interest paid  $-   $-   $- 
Income taxes paid  $-   $-   $- 

 

The accompanying notes are an integral part of these unaudited financial statements

 

6
 

 

PORTUS HOLDINGS, INC.

 

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 1 – ORGANIZATION AND BUSINESS OPERATIONS

 

PORTUS HOLDINGS, INC. (the “Company”) was incorporated in the State of Nevada on March 31, 2011. The Company is a Development Stage Company as defined by ASC 915-10. During 2012, the Company changed its fiscal year end to December 31 from March 31.

 

The Company’s principal business is focused on creating a multilingual, multiple functionality, and global food and beverage service platform (“Portus Cloud”). Portus Cloud is a global, multilingual, cloud based food and beverage service “portal” where customers will be able to manage an entire food and beverage service business or enterprise anywhere in the world, anytime and in any language.

 

The financial information included herein is unaudited and has been prepared consistent with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8, Rule 8.03 of Regulation S-K. Accordingly, these financial statements do not include all information required by generally accepted accounting principles for annual financial statements. These statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2012. These interim financial statements contain all adjustments necessary in the opinion of management for a fair statement of results for the interim periods presented.

 

The results of operations for the six months ended June 30, 2013 are not necessarily indicative of the results to be expected for the full year.  

 

NOTE 2 – GOING CONCERN

 

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has no sources of income, limited stockholders’ equity and has incurred a net loss of $609,625 from March 31, 2011 (inception) to date. These conditions raise substantial doubt about the ability of the Company to continue as a going concern.

 

In view of these matters, continuation as a going concern is dependent upon the 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. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern.

 

The Company plans to improve its financial condition through additional sales of common stock. However, there is no assurance that the Company will be successful in accomplishing this objective. Management believes that this plan provides an opportunity for the Company to continue as a going concern.

 

NOTE 3 – DEPOSITS

 

On October 12, 2012 Portus and Portus Acqusition Corp., our wholly owned subsidiary, entered into a Share Exchange Agreement with Surequest Systems, Inc., a Delaware Corporation, (“SureQuest”) and its wholly owned subsidiary Surequest Systems, Inc., a Texas corporation, (“SureQuestTX”).

 

The Agreement provides in part for the Company to acquire all of the issued and outstanding shares of common stock of SureQuestTX in exchange for all of the issued and outstanding shares of common stock of Portus Acquisition Corp. A good faith deposit in the amount of $40,000 was issued at that time. The deposit is not refundable in the event the transaction is not completed.

 

7
 

 

On Feburary 8, 2013, Portus paid $25,000 to SureQuestTX, for licensing rights to its data base and functional platform in order to launch Portus Cloud. As June 30, 2013, “Portus Cloud” has not yet launched.

 

NOTE 4 – CONVERTIBLE DEBENTURES

 

On January 19, 2013 the company issued a $50,000 convertible debenture to an Irrevocable Trust, which matures in 180 days. The debt is convertible one month after issue at $1.00 per shares. At maturity the debenture holder may elect to take cash, cash and stock or only stock. Interest accrues at 8% per annum. The note matured on July 18, 2013 and was renewed with a new unspecified due date to coincide with the public trading of the Company’s stock.

 

On February 8, 2013 the company issued a $25,000 convertible debenture to an Irrevocable Trust, which matures in 90 days. The debt is convertible one month after issues at $1.00 per shares. At maturity the debenture holder may elect to take cash, cash and stock or only stock. Interest accrues at 8% per annum. . The note matured on May 9, 2013 and was renewed with a new unspecified due date to coincide with the public trading of the Company’s stock. As of June 30, 2013 the debt had not been converted. 

 

NOTE 5 - CAPITAL STOCK

 

During the six months ended June 30, 2013, the Company received $88,634 in exchange for 66,756 shares of its common stock and issued 9,270 shares of its common stock in exchange for services valued at $13,905. At June 30, 2013, there were 113,043,526 shares issued and outstanding.

 

NOTE 6 – RELATED PARTY TRANSACTIONS 

 

During the period ended June 30, 2012, the Company paid $11,000 in management fees to its parent company, Portus, Inc.

  

NOTE 7 – SUBSEQUENT EVENTS

 

The Company has issued 36,500 shares to German investors for $1.50 per share since June 30, 2013.

 

The Company has entered into a consulting agreement with Jack Burkman and Associates. Burkman received 2,000,000 of the privately traded parent company, Portus, Inc. as compensation. No written agreement exists between Portus Inc and the Company relative to the shares.

 

8
 

 

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

 

The following discussion and analysis should be read in conjunction with our financial statements and the related notes. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as its plans, objectives, expectations and intentions. Its actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements.

 

Background

 

Portus Holdings Inc. was incorporated on March 31, 2011, under the laws of the State of Nevada. Our principal business is focused on creating a multilingual, multiple functionality, and global food and beverage service platform (“Portus Cloud”). Portus Cloud is a global, multilingual, cloud based food and beverage service “portal” where customers will be able to manage an entire food and beverage service business or enterprise anywhere in the world, anytime and in any language.

 

Portus Cloud is intended to serve the food service management industry globally. Customers expected to utilize Portus Cloud include hospitals, nursing homes, long term care, restaurants, education facilities, military, hospitality, cruise lines, corporate dining and catering facility. Portus Cloud’s functionality and design allows the managers to effectively access the supply chain and effectively manage their business in any of these industries. It will enable the creation of recipes and menus, sourcing, costing and ordering the ingredients for proper preparation and presentation and where needed clinical feedback and in multiple languages.

 

An advantage to the platform is it can be accessed anywhere there is access to the internet and is a potential advantage to all operator types in that the access is available in the field, the office the kitchen or table side. The system can even be used to enhance the consumer experience as the operator desires. The system is flexible and continually being enhance. The cost to the user; subscribe and log on and use whatever web portal they choose. The functionality that they need and desire is at their fingertips, with no ongoing IT cost associated with installed software programs and ease of implementation.

 

On October 12, 2012 Portus and Portus Acqusition Corp., our wholly owned subsidiary, entered into a Share Exchange Agreement (the “Exchange Agreement”) with Surequest Systems, Inc., a Delaware Corporation, (“SureQuest”) and its wholly owned subsidiary Surequest Systems, Inc., a Texas corporation, (“SureQuestTX”). The Exchange Agreement provides in part for the Company to acquire all of the issued and outstanding shares of common stock of SureQuestTX in exchange for all of the issued and outstanding shares of common stock of Portus Acquisition Corp. The closing of the Exchange Agreement is conditioned on, among other things, the Company having cash assets totaling $5,000,000.

 

As a part of Portus’s strategy, on February 8, 2013 we licensed the data base and functional platform for this service from SureQuest to allow us to launch Portus Cloud. The Company is pursuing potential customers but has earned no revenues.

 

During the six months ended June 30, 2013, the Company received $88,634 in exchange for 66,756 shares of its common stock and issued 9,270 shares of its common stock in exchange for services valued at $13,905. At June 30, 2013, there were 113,043,526 shares issued and outstanding. The Company has issued 36,500 shares to German investors for $1.50 per share since June 30, 2013.

  

The Company has entered into a consulting agreement with Jack Burkman and Associates. Burkman received 2,000,000 of the privately traded parent company, Portus, Inc. as compensation. No written agreement exists between Portus Inc and the Company relative to the shares.

 

9
 

 

Results of Operations 

 

Comparison of the three and six months ended June 30, 2013 and 2012 

 

Revenues 

 

The Company has no operations nor does it currently engage in any business activities generating revenues. We expect to begin generating revenue once we complete the licensing agreement with SureQuest Systems, Inc. and have launched our cloud based platform.

 

Operating Expenses 

 

For the three months ended June 30, 2013 our focus has been on developing new markets and identifying potential financing activities. In connection with these activities we incurred significant legal, finance & accounting and general & administrative expenses. These expenses totaled $1,363 $11,850 and $71,488 respectively. Total expenses for the three months ended June 30, 2012 were nominal.

 

For the six months ended June 30, 2013 legal, finance & accounting and general & administrative expenses totaled $15,350 $21,674 and $161,626 respectively. Total expenses for the six months ended June 30, 2012 were nominal.

 

Net Income and Loss 

 

Our net loss for the three months ended June 30, 2013 was $(86,217) as compared to nominal for the three months ended June 30, 2012.

 

Our net loss for the six months ended June 30, 2013 was $(201,239) as compared to nominal for the six months ended June 30, 2012.

 

Liquidity and Capital Resources 

 

At June 30, 2013 we had cash of $0 and acquisition deposits totaling $65,000. Our total assets were $65,000 and we have liabilities of $100,836.

 

If we are not successful in securing additional financing to acquire SureQuestTX, we believe that we have sufficient assets to continue to look for other business opportunities.

 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

Item 4.  Controls and Procedures.

 

Disclosure of Controls and Procedures

 

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officer, to allow timely decisions regarding required disclosure. Our chief executive officer and chief financial officer have reviewed the effectiveness of our disclosure controls and procedures as of June 30, 2013 and, based on his evaluation, and has concluded that the disclosure controls and procedures were not effective.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting during the three months ended June 30, 2013 that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

10
 

 

PART II. - OTHER INFORMATION

 

Item 1.   Legal Proceedings

 

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

 

Item 1A. Risk Factors

 

Not required for Smaller Reporting Companies.

 

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

 

During the three months ended June 30, 2013, the Company received $65,634 in exchange for 43,756 shares of its common stock pursuant to subscription agreements with various individuals.

 

During the three months ended June 30, 2013, the Company issued 9,270 shares of its common stock in exchange for services valued at $13,905.

On June 21, 2013, the Company issued 250,000 shares of its common stock to Clay Edmonds, the Company’s Executive Vice President, as a bonus for services rendered.

 

The Company issued the above shares in reliance upon the exemption from registration contained in Section 4(2) of the Securities Act. Our reliance on Section 4(2) of the Securities Act was based upon the following factors: (a) the issuance of the securities was an isolated private transaction by us which did not involve a public offering; (b) there were only a limited number of offerees; (c) there were no subsequent or contemporaneous public offerings of the securities by us; (d) the securities were not broken down into smaller denominations; and (e) the negotiations for the sale of the stock took place directly between the offeree and us.

 

Item 3.   Defaults upon Senior Securities

 

None.

 

Item 4.   Mine Safety Disclosures

 

Not applicable.

 

Item 5.   Other information

 

None.

 

Item 6.   Exhibits

 

Exhibits

31.1 Certification of Principal Executive Officer and Principal Financial Officer of the Registrant pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 * Certification of Principal Executive Officer and Principal Financial Officer of the Registrant pursuant to 18U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS ** XBRL Instance Document
101.SCH ** XBRL Taxonomy Schema
101.CAL ** XBRL Taxonomy Calculation Linkbase
101.DEF ** XBRL Taxonomy Definition Linkbase
101.LAB ** XBRL Taxonomy Label Linkbase
101.PRE ** XBRL Taxonomy Presentation Linkbase

 

*In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed.

 

** Furnished herewith. XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

  

11
 

 

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.

 

       
  PORTUS HOLDINGS INC. 
       

Date: August 14, 2013

     
       
  By: George Dale Murray, II  
    George Dale Murray, II  
    President, Chief Executive Officer,
Chief Financial Officer
 
    (Duly Authorized, Principal Executive Officer
and Principal Financial Officer)
 

 

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