10-Q 1 highland_10q-033109.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended: March 31, 2009 OR [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000 - 53432 Highland Ridge, Inc. (Name of small business issuer in its charter) Delaware 13-4013027 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 330 Clematis Street, Suite 217, West Palm Beach, Florida, 33401 (Address of principal executive offices) (zip code) 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 [ ] Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. [X} 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 [ ] APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. YES [ ] NO [ ] APPLICABLE ONLY TO CORPORATE REGISTRANTS Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. 10,987,131 as of May 14, 2009 HIGHLAND RIDGE, INC. TABLE OF CONTENTS Page Part I Item 1. Financial Statements............................................ 1 Item 2. Management's Discussion and Analysis............................ 8 Item 3. Quantitative and Qualitative Disclosures About Market Risk...... 14 Item 4T. Controls and Procedures......................................... 14 Part II Item 1. Legal Proceedings............................................... 16 Item 1A. Risk Factors.................................................... 16 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds..... 16 Item 3. Default Upon Senior Securities.................................. 16 Item 4. Submission of Matters to a Vote of Security Holders............. 16 Item 5. Controls and Procedures......................................... 16 Item 6. Exhibits........................................................ 17 Signatures................................................................ 17 1 PART I - FINANCIAL INFORMATION ITEM 1. Highland Ridge, Inc. Balance Sheet ---------------------------------------------------------------------------------------------- March 31, Sept 30, 2009 2008 ---------------------------------------------------------------------------------------------- (unaudited) ASSETS Current assets Cash $ 16,505 $ 29,419 Prepaid expenses 0 0 ------------------------------ Total current assets 16,505 29,419 ---------------------------------------------------------------------------------------------- Total Assets $ 16,505 $ 29,419 ---------------------------------------------------------------------------------------------- LIABILITIES AND STOCKHOLDERS' DEFICIENCY Current liabilities: Accounts payable-trade $ 1,660 $ 12,141 Accrued expenses 0 0 Due to related parties 21,508 21,508 ------------------------------ Total current liabilities 23,168 33,649 Stockholders' Deficiency: Preferred "B" stock-1,000,000 issued & outstanding in Sept. 0 30,000 Common stock-300,000,000 authorized $001 par value 10,987,131 shares issued & outstanding 10,987 987 Additional paid-in capital 60,977 28,977 Deficit accumulated since quasi reorganization Aug 31, 2005 (78,626) (64,194) ------------------------------ Total Stockholders' Deficiency (6,662) (4,230) ---------------------------------------------------------------------------------------------- Total Liabilities & Stockholders' Deficiency $ 16,505 $ 29,419 ---------------------------------------------------------------------------------------------- See notes to unaudited interim financial statements. 2 Highland Ridge, Inc. Statement of Operations (unaudited) Three Months Ended March 31, Six Months Ended March 31, ------------------------------ ------------------------------ 2009 2008 2009 2008 ------------ ------------ ------------ ------------ Revenue $ 0 $ 0 $ 0 $ 0 Costs & Expenses: General & administrative 7,783 7,611 14,433 10,911 Interest 0 0 0 0 ------------ ------------ ------------ ------------ Total Costs & Expenses 7,783 7,611 14,433 10,911 Loss from continuing operations before income taxes (7,783) (7,611) (14,433) (10,911) Income taxes 0 0 0 0 -------------------------------------------------------------------------------------------------------------------------------- Net Loss ($ 7,783) ($ 7,611) ($ 14,433) ($ 10,911) -------------------------------------------------------------------------------------------------------------------------------- Basic and diluted per share amounts: Continuing operations Nil Nil Nil ($ 0.02) -------------------------------------------------------------------------------------------------------------------------------- Basic and diluted net loss Nil Nil Nil ($ 0.02) -------------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------------------------- Weighted average shares outstanding (basic & diluted) 10,987,131 987,131 8,184,933 664,945 -------------------------------------------------------------------------------------------------------------------------------- See notes to unaudited interim financial statements. 3 Highland Ridge, Inc. Statement of Cash Flows (unaudited) Six Months Ended March 31, -------------------------- 2009 2008 ---------- ---------- Cash flows from operating activities: Net Loss ($14,433) ($10,911) Adjustments required to reconcile net loss to cash used in operating activities: Fair value of services provided by related parties 12,000 6,000 Expenses paid by related parties 0 4,911 Increase (decrease) in accounts payable & accrued expenses (10,481) 0 ----------------------------------------------------------------------------------------------- Cash used by operating activities: (12,914) 0 ----------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------- Cash used in investing activities 0 0 ----------------------------------------------------------------------------------------------- Cash flows from financing activities: Proceeds from issuance of preferred stock 0 0 ----------------------------------------------------------------------------------------------- Cash generated by financing activities 0 0 ----------------------------------------------------------------------------------------------- Change in cash (12,914) 0 Cash-beginning of period 29,419 0 ----------------------------------------------------------------------------------------------- Cash-end of period $ 16,505 $ 0 ----------------------------------------------------------------------------------------------- See notes to unaudited interim financial statements. 4 Highland Ridge, Inc. Statement of Stockholders' Deficiency (Unaudited) Preferred Stock Common Stock -------------------------- ---------------------------------------- Deficit Accumulated Additional since quasi Common paid-in reorganization Shares Amount Shares Stock capital Aug 31, 2005 ---------------------------------------------------------------------------------------------------------------------------------- Balance at September 30, 2007 107,131 $ 107 $ 5,249 ($ 9,036) ---------------------------------------------------------------------------------------------------------------------------------- Issuance of Preferred "B" shares 1,000,000 30,000 Stock issued as reimbursement of reinstatement expenses paid by related party 880,000 880 5,728 Fair value of services provided by related party 18,000 Net Loss (55,158) ---------------------------------------------------------------------------------------------------------------------------------- Balance at September 30, 2008 1,000,000 $ 30,000 987,131 987 28,977 (64,194) ---------------------------------------------------------------------------------------------------------------------------------- Conversion of Preferred stock (1,000,000) (30,000) 10,000,000 10,000 20,000 Fair value of services provided by related party 12,000 Net Loss (14,433) ---------------------------------------------------------------------------------------------------------------------------------- Balance at March 31, 2009 0 $ 0 10,987,131 $ 10,987 $ 60,977 ($ 78,627) ---------------------------------------------------------------------------------------------------------------------------------- See notes to unaudited interim financial statements. 5 HIGHLAND RIDGE, INC. NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION: Effective August 31, 2005, the Company approved and authorized a plan of quasi reorganization and restatement of accounts to eliminate the accumulated deficit and related capital accounts on the Company's balance sheet. The Company concluded its period of reorganization after reaching a settlement agreement with all of its significant creditors. The Company, as approved by its Board of Directors, elected to state its October 1, 2005, balance sheet as a "quasi reorganization", pursuant to ARB 43. These rules require the revaluation of all assets and liabilities to their current values through a current charge to earnings and the elimination of any deficit in retained earnings by charging paid-in capital. From October 1, 2005 forward, the Company has recorded net income (and net losses) to retained earnings and (and net losses) to retained earnings and (accumulated deficit). The Financial Statements presented herein have been prepared by us in accordance with the accounting policies described in our September 30, 2008 audited financial statements included in Form 10-K and should be read in conjunction with the Notes to Financial Statements which appear in that report. The preparation of these financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on going basis, we evaluate our estimates, including those related intangible assets, income taxes, insurance obligations and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other resources. Actual results may differ from these estimates under different assumptions or conditions. In the opinion of management, the information furnished in these interim financial statements reflect all adjustments necessary for a fair statement of the financial position and results of operations and cash flows as of and for the three and six-month periods ended March 31, 2009 and 2008. All such adjustments are of a normal recurring nature. The financial statements do not include some information and notes necessary to conform with annual reporting requirements. 2. RECENT COURT PROCEEDINGS: On September 14, 2007, in its Court Order, the Circuit Court for the 11th Judicial Circuit in and for Miami Dade County, Florida granted the application of Century Capital Partners, LLC to appoint a receiver. On December 6, 2007, following the submittal of detailed reports by the receiver the Court discharged the receiver and returned the Company to the control of its Board of Directors. On January 30, 2008 after proper notice to all shareholders, the Company held an annual meeting for the purposes of the election of directors. At the meeting, Michael Anthony was elected the sole Director. Immediately following the shareholder meeting, Michael Anthony was appointed President, Secretary and Treasurer. RESULTANT CHANGE IN CONTROL: In connection with the Order and subsequent shareholder meeting, Michael Anthony became our sole director and President on January 30, 2008. As sole officer and director, Michael Anthony entered into an agreement with Corporate Services International Profit Sharing Plan (CSIPSP) whereby CSIPSP agreed to make an investment of paid in capital of $30,000 to be used to pay for costs and expenses necessary to bring the Company back into compliance with state and federal securities laws and bring current all Securities and Exchange disclosure obligations. In exchange for the $30,000 CSIPSP was issued 1,000,000 shares of preferred stock on August 12, 2008. Mr. Anthony is the managing member of Century Capital partners and has sole voting and dispositive control. Corporate Services International Profit Sharing Plan is a private profit sharing plan for which our director, Michael Anthony, is the sole beneficiary. 6 3. EARNINGS/LOSS PER SHARE Basic earnings per share is computed by dividing income available to common shareholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period. Diluted earnings per share assume that any dilutive convertible securities outstanding were converted, with related preferred stock dividend requirements and outstanding common shares adjusted accordingly. It also assumes that outstanding common shares were increased by shares issuable upon exercise of those stock options for which market price exceeds the exercise price, less shares which could have been purchased by us with the related proceeds. In periods of losses, diluted loss per share is computed on the same basis as basic loss per share as the inclusion of any other potential shares outstanding would be anti-dilutive. All per share disclosures retroactively reflect shares outstanding or issuable as though the reverse split had occurred October 1, 2007. 4. NEW ACCOUNTING STANDARDS In December 2007, the Financial Accounting Standards Board issued FASB Statement No. 141 (Revised 2007), Business Combinations ("SFAS 141R"). SFAS 141R provides additional guidance on improving the relevance, representational faithfulness, and comparability of the financial information that a reporting entity provides in its financial reports about a business combination and its effects. This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. In December 2007, the Financial Accounting Standards Board issued FASB Statement No. 160, NONCONTROLLING INTERESTS IN CONSOLIDATED FINANCIAL STATEMENTS--AN AMENDMENT OF ARB NO. 51 ("SFAS 160"). SFAS 160 amends ARB No. 51 to establish accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. This Statement is effective for fiscal years and interim periods within those fiscal years, beginning on or after December 15, 2008. The Company is currently evaluating the impact of adopting SFAS 160 on our financial statements. In May 2008, the FASB issued SFAS No. 162, "THE HIERARCHY OF GENERALLY ACCEPTED ACCOUNTING PRINCIPLES." SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States. SFAS 162 is effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, THE MEANING OF PRESENT FAIRLY IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. Our Company is currently evaluating the impact of SFAS 162 on its financial statements but does not expect it to have a material effect. Management does not anticipate that the adoption of these standards will have a material impact on the financial statements. 5. STOCKHOLDERS' EQUITY: COMMON STOCK On November 20, 2008, Corporate Services International Profit Sharing Plan converted the Series B Preferred Stock into 10,000,000 shares of common stock. 6. RELATED PARTY TRANSACTIONS NOT DISCLOSED ELSEWHERE FAIR VALUE OF SERVICES: The principal stockholder provided, without cost to the Company, his services, valued at $1,800 per month through March 31, 2009, which totaled $10,800 for the six-month period then ended. The principal stockholder also provided, without cost to the Company, office space valued at $200 per month, which totaled $1,200 for the six-month period ended March 31, 2009. The total of these expenses was $12,000 and was reflected in the statement of operations as general and administrative expenses with a corresponding contribution of paid-in capital. Similar charges for the comparative 2008 six month period totaled $6,000. Legal services provided to the company by Laura Anthony through Legal & Compliance, LLC (Michael Anthony's spouse) was valued at $20,000 and was unpaid at March 31, 2009. DUE RELATED PARTIES: Other amounts due related parties consist of corporate reinstatement expenses paid by the principal shareholder prior to the establishment of a bank account. 7 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This quarterly report on Form 10-Q contains forward-looking statements that are based on current expectations, estimates, forecasts and projections about the Company, us, our future performance, our beliefs and our Management's assumptions. In addition, other written or oral statements that constitute forward-looking statements may be made by us or on our behalf. Words such as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict or assess. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Except as required under the federal securities laws and the rules and regulations of the SEC, we do not have any intention or obligation to update publicly any forward-looking statements after the filing of this Form 10-Q, whether as a result of new information, future events, changes in assumptions or otherwise. Readers are cautioned not to place undue reliance on the forward- looking statements contained herein, which speak only as of the date hereof. We believe the information contained in this Form 10-Q to be accurate as of the date hereof. Changes may occur after that date. We will not update that information except as required by law in the normal course of its public disclosure practices. Additionally, the following discussion regarding our financial condition and results of operations should be read in conjunction with the financial statements and related notes. History ------- Highland Ridge, Inc., (the "Company", "we", "us" or "Highland Ridge"), was originally incorporated on July 22, 1988 in the State of Florida as Sea Green, Inc. At the time of formation the Company was authorized to issue 7,500 shares of $1.00 par value common stock. The Company was originally formed for the purpose of developing communication systems to market for use and resale. In anticipation of the commencement of the trading of our common stock on the over the counter market, we filed an amendment to our Articles of Incorporation on May 5, 1998 increasing our authorized capital stock to 50,000,000 shares of $.001 par value common stock. In addition, we filed an Amendment to our articles of incorporation on June 3, 1998, changing our name to Americom Networks Corp. On July 10, 1998, we again changed our name to Americom Networks International, Inc. During this time we engaged in the business of developing telecommunications systems to market to high-volume users for use or resale. In May 1999 we ceased operations and have not engaged in business operations since that time. On December 21, 1999 we filed a registration statement on Form SB-2 with the Securities and Exchange Commission for an offering by a blank check Company pursuant to Rule 419 of the Securities Act of 1933. We filed three amendments to the registration statement and then ultimately abandoned the process prior to its effectiveness. In September, 2000 the Secretary of State of Florida administratively dissolved our corporate charter for not maintaining proper filings with the state and not paying our franchise tax fees. Effective August 31, 2005, the Company approved and authorized a plan of quasi reorganization and restatement of accounts to eliminate the accumulated deficit and related capital accounts on the Company's balance sheet. The Company concluded its period of reorganization after reaching a settlement agreement with all of its significant creditors. The Company, as approved by its Board of Directors, elected to state its October 31, 2005, balance sheet as a "quasi reorganization", pursuant to ARB 43. These rules require the revaluation of all assets and liabilities to their current values through a current charge to earnings and the elimination of any deficit in retained earnings by charging paid-in capital. From October 1, 2005 forward, the Company has recorded net income (and net losses) to retained earnings and (and net losses) to retained earnings and (accumulated deficit). On September 14, 2007, in its Court Order, the Circuit Court for the 11th Judicial Circuit in and for Miami Dade County, Florida granted the application of Century Capital Partners, LLC to have a receiver appointed. The Court appointed Brian T. Scher, Esquire as receiver of the Company. The Court Order appointing Receiver empowered Mr. Scher to evaluate our financial status, to determine whether there are any options for corporate viability that could benefit our shareholders, to reinstate our corporation with the Florida Secretary of State, and to obtain copies of our shareholder records from our transfer agent. 8 Mr. Michael Anthony is the sole member of Century Capital Partners. Under Mr. Scher's receivership, and with funds supplied by Century Capital Partners, the Company reinstated its corporate charter and paid all past due franchise taxes; paid the outstanding debt with the transfer agent; and made an analysis of the Company's debts and potential for viability as a merger or acquisition candidate. In addition, on October 13, 2007, Mr. Scher, as receiver, appointed Michael Anthony as our sole Director, President, Secretary and Treasurer. On December 6, 2007, following the submittal of reports by Mr. Scher, the Court discharged the receiver and returned the Company to the control of its Board of Directors. On January 30, 2008 after proper notice to all shareholders, the Company held an annual meeting for the purposes of the election of directors. At the meeting, Michael Anthony was elected the sole Director. Immediately following the shareholder meeting, Michael Anthony was appointed President, Secretary and Treasurer. From May, 2007 through September, 2007 Century Capital Partners invested $6,608.00 into our Company as paid in capital which funds were used to pay ongoing administrative expenses, including but not limited to, outstanding transfer agent fees, state reinstatement and filing fees and all costs associated with conducting the shareholders meeting. In exchange for the capital investment by Century Capital Partners, on December 6, 2007, we issued forty four million (44,000,000) shares of restricted $.001 par value common stock (880,000 shares post reverse). On or near August 12, 2008, Corporate Services International Profit Sharing Plan contributed $30,000 as paid in capital to Highland Ridge. Corporate Services International Profit Sharing Plan is an ERISA Trust for which our director, Michael Anthony, is the sole beneficiary. This capital contribution is separate from and in addition to the $6,608.00 capital contribution by Century Capital Partners. Highland Ridge has used and shall continue to use these funds to pay the costs and expenses necessary to maintain the Company as a reporting entity and implement the Company's business plan of acquiring, being acquired by or otherwise becoming an operating business. Such expenses include, without limitation, fees to redomicile the Company to the state of Delaware; payment of state filing fees; transfer agent fees; accounting and legal fees; and costs associated with preparing and filing this Registration Statement, etc. In consideration of its capital contribution, Highland Ridge agreed to issue to Corporate Services International Profit Sharing plan 1,000,000 shares of Series B Preferred Stock, which Series B Preferred Stock carry super voting rights of ten (10) votes per share and are convertible into ten (10) shares of common stock per share. The 1,000,000 shares of Series B Preferred Stock were issued to Corporate Services International Profit Sharing Plan on August 12, 2008. On November 20, 2008, Corporate Services International Profit Sharing Plan converted the Series B Preferred Stock into 10,000,000 shares of common stock. Moreover, Michael Anthony, as officer and director has agreed to assist the Company in its efforts. Mr. Anthony's efforts include, but are not limited to, assistance in gathering information, retaining counsel and working with counsel and the auditor for purposes of preparation of periodic reports and corresponding audited financial statements. Mr. Anthony and Highland Ridge do not have a written agreement. Prior to changing our name to Highland Ridge, on January 31, 2008, Americom Networks International, Inc. was incorporated in Delaware for the purpose of merging with Americom Networks International, Inc. a Florida Corporation so as to effect a re-domicile to Delaware. The Delaware Corporation is authorized to issue 300,000,000 shares of $.001 par value common stock and 10,000,000 shares of $.001 par value preferred stock. On February 6, 2008 both Americom Networks the Florida corporation and Americom Networks the Delaware corporation signed and filed Articles of Merger with their respective states, pursuant to which the Florida Corporation's shareholders received one share of new (Delaware) common stock for every one share of old (Florida) common stock they owned. All outstanding shares of the Florida Corporation's common stock were effectively purchased by the new Delaware Corporation, effectively merging the Florida Corporation into the Delaware Corporation, and making the Delaware Corporation the surviving entity. The change of domicile from Florida to Delaware was agreed to by the consent of the majority of our outstanding voting stock held by Century Capital Partners and Corporate Services International Profit Sharing Plan. Effective August 15, 2008 the Company enacted a 1:50 reverse split of our outstanding common stock and changed our name to our current name, Highland Ridge, Inc. Our new name, Highland Ridge, Inc. is not meant to be indicative of a specific business plan or purpose, but rather was meant to be neutral in an effort to further our plan of attracting a potential merger candidate or acquiring a business. See "Current Business Plan". 9 In addition, on August 1, 2008 we designated 1,000,000 shares of Series B Preferred Stock, which preferred stock has super voting rights of ten (10) votes per share and is convertible into ten (10) shares of common stock per share. On August 12, 2008 we issued the 1,000,000 shares of Series B Preferred Stock to Corporate Services International Profit Sharing in exchange for its $30,000 capital contribution. On November 20, 2008, Corporate Services International Profit Sharing Plan converted the Series B Preferred Stock into 10,000,000 shares of common stock. On August 5, 2008, we adopted Amended and Restated By-Laws. Current Business Plan --------------------- Highland Ridge is a shell company in that it has no or nominal operations and either no or nominal assets. At this time, Highland Ridge's purpose is to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities presented to it by persons or firms who or which desire to seek the perceived advantages of an Exchange Act registered corporation. The Company will not restrict its search to any specific business, industry, or geographical location and the Company may participate in a business venture of virtually any kind or nature. This discussion of the proposed business is purposefully general and is not meant to be restrictive of the Company's virtually unlimited discretion to search for and enter into potential business opportunities. Management anticipates that it may be able to participate in only one potential business venture because the Company has nominal assets and limited financial resources. This lack of diversification should be considered a substantial risk to shareholders of the Company because it will not permit the Company to offset potential losses from one venture against gains from another. Management may sell its shares to a third party who subsequently will complete a transaction to bring the Company from a shell company to an operating entity. Management has substantial flexibility in identifying and selecting a prospective new business opportunity. Highland Ridge would not be obligated nor does management intend to seek pre-approval by our shareholders prior to entering into a transaction. Highland Ridge may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. Highland Ridge may acquire assets and establish wholly owned subsidiaries in various businesses or acquire existing businesses as subsidiaries. Highland Ridge intends to promote itself privately. The Company anticipates that the selection of a business opportunity in which to participate will be complex and risky. Due to general economic conditions, rapid technological advances being made in some industries and shortages of available capital, management believes that there are numerous firms seeking the perceived benefits of a publicly registered corporation. Such perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, providing liquidity (subject to restrictions of applicable statutes), for all shareholders, and other factors. Highland Ridge has, and will continue to have, little or no capital with which to provide the owners of business opportunities with any significant cash or other assets. On August 12, 2008, Corporate Services International Profit Sharing Plan deposited $30,000 with the Company and accordingly the cash balance on that date was $30,000. At quarter end March 31, 2009 Highland Ridge had a cash balance of $16,505. Management believes the Company will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. The owners of the business opportunities will, however, incur significant legal and accounting costs in connection with the acquisition of a business opportunity, including the costs of preparing Form 8K's, 10K's, 10Q's and agreements and related reports and documents. The Securities Exchange Act of 1934 (the "34 Act"), specifically requires that any merger or acquisition candidate comply with all applicable reporting requirements, which include providing audited financial statements to be included within the numerous filings relevant to complying with the `34 Act. Nevertheless, the officer and director of Highland Ridge has not conducted market research and is not aware of statistical data which would support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity. 10 The Company intends to concentrate on identifying preliminary prospective business opportunities, which may be brought to its attention through present associations of the Company's officer and director. In analyzing prospective business opportunities, the Company will consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development, or exploration; specific risk factors not now foreseeable but which then may be anticipated to impact the proposed activities of the Company; the potential for growth or expansion; the potential for profit; the perceived public recognition or acceptance of products, services, or trades; name identification; and other relevant factors. The Company will not acquire or merge with any company for which audited financial statements are not available. The foregoing criteria are not intended to be exhaustive and there may be other criteria that the Company may deem relevant. The Officer of Highland Ridge has some, but not extensive experience in managing companies similar to the Company and shall mainly rely upon his own efforts, in accomplishing the business purposes of the Company. The Company may from time to time utilize outside consultants or advisors to effectuate its business purposes described herein. No policies have been adopted regarding use of such consultants or advisors, the criteria to be used in selecting such consultants or advisors, the services to be provided, the term of service, or regarding the total amount of fees that may be paid. However, because of the limited resources of the Company, it is likely that any such fee the Company agrees to pay would be paid in stock and not in cash. Highland Ridge does not intend to obtain funds in one or more private placements to finance the operation of any acquired business opportunity until such time as the Company has successfully consummated such a merger or acquisition. Management intends to devote such time as it deems necessary to carry out the Company's affairs. We cannot project the amount of time that our management will actually devote to our plan of operation. Highland Ridge intends to conduct its activities so as to avoid being classified as an "Investment Company" under the Investment Company Act of 1940, and therefore avoid application of the costly and restrictive registration and other provisions of the Investment Company Act of 1940 and the regulations promulgated thereunder. Management has not identified and is not currently negotiating a new business opportunity for us. As of May 14,2009, Highland Ridge is not in negotiations with, nor does it have any agreements with any potential merger candidate or any transaction that could result in a change of control of the Company. GOVERNMENT REGULATIONS As a registered corporation, Highland Ridge, Inc. is subject to the reporting requirements of the Securities Exchange Act of 1934 (the "34 Act") which includes the preparation and filing of periodic, quarterly and annual reports on Forms 8K, 10Q and 10K. The 34 Act specifically requires that any merger or acquisition candidate comply with all applicable reporting requirements, which include providing audited financial statements to be included within the numerous filings relevant to complying with the `34 Act. Highland Ridge is a Blank Check Company --------------------------------------- At present, Highland Ridge is a development stage company with no revenues and with no specific business plan or purpose. Highland Ridge's business plan is to seek new business opportunities or to engage in a merger or acquisition with an unidentified company. As a result, Highland Ridge is a blank check company and any offerings of our securities would need to comply with Rule 419 under the Act. The provisions of Rule 419 apply to every registration statement filed under the Securities Act of 1933, as amended, by a blank check company. Rule 419 requires that the blank check company filing such registration statement deposit the securities being offered and proceeds of the offering into an escrow or trust account pending the execution of an agreement for an acquisition or merger. In addition, the registrant is required to file a post effective amendment to the registration statement containing the same information as found in a Form 10 registration statement, upon the execution of an agreement for such acquisition or merger. The rule provides procedures for the release of the offering funds in conjunction with the post effective acquisition or merger. Highland Ridge has no current plans to engage in any such offerings. 11 Highland Ridge's Common Stock is a Penny Stock ---------------------------------------------- Highland Ridge's common stock is a "penny stock," as defined in Rule 3a51-1 under the Exchange Act. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its sales person in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that the broker-dealer, not otherwise exempt from such rules, must make a special written determination that the penny stock is suitable for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure rules have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules. So long as the common stock of Highland Ridge is subject to the penny stock rules, it may be more difficult to sell our common stock. Acquisition of Opportunities ---------------------------- Management beneficially owns 10,880,000 shares of common stock (post split) or 99% of the voting rights of the total issued and outstanding capital shares of Highland Ridge. As a result, management will have substantial flexibility in identifying and selecting a prospective new business opportunity. In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity. It may also acquire stock or assets of an existing business. On the consummation of a transaction, it is probable that the present management and shareholders of the Company will no longer be in control of the Company. In addition, the Company's directors may, as part of the terms of the acquisition transaction, resign and be replaced by new directors without a vote of the Company's shareholders or may sell their stock in the Company. Moreover, management may sell or otherwise transfer his interest in the Company to new management who will then continue the Company business plan of seeking new business opportunities. In the past management has completed a sale of its stock to new management who subsequently complete a transaction to move the Company from a shell to an operating business. It is anticipated that any securities issued in any reorganization would be issued in reliance upon an exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter. If such registration occurs, of which there can be no assurance, it will be undertaken by the surviving entity after the Company has successfully consummated a merger or acquisition. With respect to any merger or acquisition, negotiations with target company management are expected to focus on the percentage of the Company which the target company shareholders would acquire in exchange for all of their shareholdings in the target company. Depending upon, among other things, the target company's assets and liabilities, the Company's shareholders will in all likelihood hold a substantially lesser percentage ownership interest in the Company following any merger or acquisition. The percentage ownership may be subject to significant reduction in the event the Company acquires a target company with substantial assets. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by the Company's then shareholders. Highland Ridge will participate in a business opportunity only after the negotiation and execution of appropriate written agreements. Although the terms of such agreements cannot be predicted, generally such agreements will require some specific representations and warranties by all of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by each of the parties prior to and after such closing, will outline the manner of bearing costs, including costs associated with the Company's attorneys and accountants, will set forth remedies on default and will include miscellaneous other terms. Highland Ridge does not intend to provide its security holders with any complete disclosure documents, including audited financial statements, concerning an acquisition or merger candidate and its business prior to the consummation of any acquisition or merger transaction. Highland Ridge has not expended funds on and has no plans to expend funds or time on product research or development. 12 On September 22, 2008, Highland Ridge filed a Registration Statement on Form 10 with the Securities and Exchange Commission to become subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. Competition ----------- Highland Ridge will remain an insignificant participant among the firms which engage in the acquisition of business opportunities. In view of Highland Ridge's combined extremely limited financial resources and limited management availability, the Company will continue to be at a significant competitive disadvantage compared to the Company's competitors Employees --------- Highland Ridge currently has no employees. The business of the Company will be managed by its sole officer and director and such officers or directors which may join the Company in the future, and who may become employees of the Company. The Company does not anticipate a need to engage any fulltime employees at this time. OVERVIEW Effective August 31, 2005, the Company approved and authorized a plan of quasi reorganization and restatement of accounts to eliminate the accumulated deficit and related capital accounts on the Company's balance sheet. The Company concluded its period of reorganization after reaching a settlement agreement with all of its significant creditors. The Company, as approved by its Board of Directors, elected to state its October 1, 2005, balance sheet as a "quasi reorganization", pursuant to ARB 43. These rules require the revaluation of all assets and liabilities to their current values through a current charge to earnings and the elimination of any deficit in retained earnings by charging paid-in capital. From October 1, 2005 forward, the Company has recorded net income (and net losses) to retained earnings and (and net losses) to retained earnings and (accumulated deficit). Our current activities are related to seeking new business opportunities. We will use our limited personnel and financial resources in connection with such activities. It may be expected that pursuing a new business opportunity will involve the issuance of restricted shares of common stock. At March 31, 2009 we had a cash balance of $16,505. At March 31, 2009 the Company had current liabilities of $23,168, $21,508 of which was due to related parties. We have had no revenues in either the quarter end March 31, 2009 or 2008. Our operating expenses for the quarter end March 31, 2009 were $7,783 comprised of general and administrative expenses. Accordingly, we had a net loss of $7,783 and a net loss per share of $Nil for the quarter end March 31, 2009. CONTINUING OPERATIONS, LIQUIDITY AND CAPITAL RESOURCES We have received a total of $36,608.00 from management related parties as capital investments in exchange for 44,000,000 (880,000 post split) shares of common stock and 1,000,000 shares of Series B Preferred Stock. On November 20, 2008, Corporate Services International Profit Sharing Plan converted the Series B Preferred Stock into 10,000,000 shares of common stock. While we are dependent upon interim funding provided by management to pay professional fees and expenses, we have no written finance agreement with management to provide any continued funding. As of March 31, 2009 the Company had current liabilities of $23,168, of which $21,508 are owed to related parties. Although we believe management will continue to fund the Company on an as needed basis, we do not have a written agreement requiring such funding. In addition, future management funding, will more than likely be in the form of loans, for which the Company will be liable to pay back. Management provided, without cost to the Company, his services, valued at $1,800 per month through March 31, 2009, which totaled $10,800 for the six months then ended. The principal stockholder also provided, without cost to the Company, office space valued at $200 per month, which totaled $1,200 for the six months ended March 31, 2009. The total of these expenses was $12,000 and was reflected in the statement of operations as general and administrative expenses with a corresponding contribution of paid-in capital. 13 The Company has limited liquidity or capital resources. As of March 31, 2009, the Company had a cash balance of $16,505. In the event that the Company cannot complete a merger or acquisition and cannot obtain capital needs for ongoing expenses, including expenses related to maintaining compliance with the securities laws and filing requirements of the Securities Exchange Act of 1934, the Company could be forced to cease operations. Highland Ridge currently plans to satisfy its cash requirements for the next 12 months though it's current cash and by borrowing from its officer and director or companies affiliated with its officer and director and believes it can satisfy its cash requirements so long as it is able to obtain financing from these affiliated entities. Highland Ridge currently expects that money borrowed will be used during the next 12 months to satisfy the Company's operating costs, professional fees and for general corporate purposes. The Company may explore alternative financing sources, although it currently has not done so. Highland Ridge will use its limited personnel and financial resources in connection with seeking new business opportunities, including seeking an acquisition or merger with an operating company. It may be expected that entering into a new business opportunity or business combination will involve the issuance of a substantial number of restricted shares of common stock. If such additional restricted shares of common stock are issued, the shareholders will experience a dilution in their ownership interest in the Company. If a substantial number of restricted shares are issued in connection with a business combination, a change in control may be expected to occur. In connection with the plan to seek new business opportunities and/or effecting a business combination, the Company may determine to seek to raise funds from the sale of restricted stock or debt securities. The Company has no agreements to issue any debt or equity securities and cannot predict whether equity or debt financing will become available at acceptable terms, if at all. There are no limitations in the certificate of incorporation on the Company's ability to borrow funds or raise funds through the issuance of restricted common stock to effect a business combination. The Company's limited resources and lack of recent operating history may make it difficult to borrow funds or raise capital. Such inability to borrow funds or raise funds through the issuance of restricted common stock required to effect or facilitate a business combination may have a material adverse effect on the Company's financial condition and future prospects, including the ability to complete a business combination. To the extent that debt financing ultimately proves to be available, any borrowing will subject the Company to various risks traditionally associated with indebtedness, including the risks of interest rate fluctuations and insufficiency of cash flow to pay principal and interest, including debt of an acquired business. The Company currently has no plans to conduct any research and development or to purchase or sell any significant equipment. The Company does not expect to hire any employees during the next 12 months. OFF BALANCE SHEET ARRANGEMENTS None. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Not applicable to Highland Ridge, Inc. as a smaller reporting company. ITEM 4T. CONTROLS AND PROCEDURES It is the responsibility of the chief executive officer and chief financial officer of Highland Ridge, Inc. to establish and maintain a system for internal controls over financial reporting such that Highland Ridge, Inc. properly reports and files all matters required to be disclosed by the Securities Exchange Act of 1934 (the "Exchange Act"). Michael Anthony is the Company's chief executive officer and chief financial officer. The Company's system is designed so that information is retained by the Company and relayed to counsel as and when it becomes available. As the Company is a shell company with no or nominal business operations, Mr. Anthony immediately becomes aware of matters that would require disclosure under the Exchange Act. After conducting an evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures as of March 31, 2009, he has concluded that the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed by it in its reports filed or submitted 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 (the "SEC"). 14 This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this quarterly report. There were no significant changes in the Company's internal controls or in other factors that could significantly affect these controls subsequent to that evaluation, and there were no significant deficiencies or material weaknesses in such controls requiring corrective actions. Evaluation of and Report on Internal Control over Financial Reporting The management of the Registrant is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company's principal executive and principal financial officers and effected by the company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that: - Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; - Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and - Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Management assessed the effectiveness of the Company's internal control over financial reporting as of March 31, 2009. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Based on its assessment, management concluded that, as of March 31, 2009, the Company's internal control over financial reporting is effective based on those criteria. This quarterly report does not include an attestation report of the Company's registered accounting firm regarding internal control over financial reporting. Management's report is not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this Quarterly report. Changes in Internal Control over Financial Reporting ---------------------------------------------------- There was no change in our internal controls over financial reporting identified in connection with the requisite evaluation that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 15 PART II - OTHER INFORMATION ITEM 1: LEGAL PROCEEDINGS On September 14, 2007, in its Court Order, the Circuit Court for the 11th Judicial Circuit in and for Miami Dade County, Florida granted the application of Century Capital Partners, LLC to appoint a receiver. The Court appointed Brian T. Scher, Esquire as receiver of the Company. The Court Order appointing Receiver empowered Mr. Scher to evaluate our financial status, to determine whether there are any options for corporate viability that could benefit our shareholders, to reinstate our corporation with the Florida Secretary of State, and to obtain copies of our shareholder records from our transfer agent. Highland Ridge's officers and directors are not aware of any threatened or pending litigation to which the Company is a party or which any of its property is the subject and which would have any material, adverse effect on the Company. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS The following is a list of unregistered securities sold by the Company within the last three years including the date sold, the title of the securities, the amount sold, the identity of the person who purchased the securities, the price or other consideration paid for the securities, and the section of the Securities Act of 1933 under which the sale was exempt from registration as well as the factual basis for claiming such exemption. From May, 2007 through August, 2008 Century Capital Partners invested $6,608.00 into our Company as paid in capital which funds were used to pay ongoing administrative expenses, including but not limited to, outstanding transfer agent fees, state reinstatement and filing fees and all costs associated with conducting the shareholders meeting. In exchange for the capital investment by Century Capital Partners, on December 6, 2007, we issued forty four million (44,000,000) shares of restricted $.001 par value common stock (880,000 shares post reverse). On or near August 12, 2008, Corporate Services International Profit Sharing Plan contributed $30,000 as paid in capital to Highland Ridge in exchange for 1,000,000 shares of our Series B Preferred Stock. Corporate Services International Profit Sharing Plan is a private profit sharing plan for which our director, Michael Anthony, is the sole beneficiary. Highland Ridge has used and shall continue to use these funds to pay the costs and expenses necessary to revive the Company's business and implement the Company's business plan. Such expenses include, without limitation, fees to redomicile the Company to the state of Delaware; payment of state filing fees; transfer agent fees; accounting and legal fees; and costs associated with preparing and filing this Registration Statement, etc. On November 20, 2008, Corporate Services International Profit Sharing Plan converted the Series B Preferred Stock into 10,000,000 shares of common stock. The Company believes that the issuance and sale of the restricted shares was exempt from registration pursuant to Section 4(2) of the Act as privately negotiated, isolated, non-recurring transactions not involving any public solicitation. An appropriate restrictive legend is affixed to the stock certificates issued in such transactions. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS On January 30, 2008 after notice to all shareholders, the Company held an annual meeting for the purposes of the election of directors. At the meeting, Michael Anthony was elected the sole Director. Immediately following the shareholder meeting, Michael Anthony was appointed President, Secretary and Treasurer. The total votes, in pre-split numbers in favor of Mr. Anthony's election were 44,022,100; those against were 0; and those abstaining were 5,334,127. ITEM 5. OTHER INFORMATION None. 16 ITEM 6. EXHIBITS NUMBER DESCRIPTION ------ ----------- 3.1.1 Original Articles of Incorporation dated July 22, 1988* 3.1.2 Articles of Amendment dated May 5, 1998* 3.1.3 Articles of Amendment dated June 3, 1998* 3.1.4 Articles of Amendment dated July 10, 1998* 3.1.5 Articles of Incorporation - Delaware - dated January 31, 2008* 3.1.6 Certificate of Amendment to Articles of Incorporation dated August 1, 2008* 2.1.1 Agreement of Merger dated February 6, 2008* 2.1.2 Certificate of Merger - Delaware - dated February 6, 2008* 2.1.3 Article of Merger - Florida - dated February 15, 2008* 3.2 Amended and Restated By-Laws* 31.1 Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes Oxley Act of 2002 * Previously filed with the Company Form 10 filed on September 22, 2008 REPORTS ON 8-K None SIGNATURES In accordance with Section 13 or 15(d) 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. Date: May 14, 2009 HIGHLAND RIDGE, INC. By: /s/ Michael Anthony ------------------------------ Name: Michael Anthony Title: Chief Executive Officer 17