UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C.  20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended: JuneSeptember 30, 2016
Commission File Number 000-55019

HOME TREASURE FINDERS, INC. AND SUBSIDIARY
(Exact name of registrant as specified in its charter)

COLORADO26-3119496
(State or other jurisdiction of(I.R.S. Employer Identification No.)
incorporation or organization) 
  
43184316 Tennyson Street, Denver, Colorado
8022180212
(Address of principal executive offices)(Zip code)

(720) 273-2398
(Registrant's telephone number, including area code)

(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 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.   ý Yes           o No
 
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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   ý Yes                      o No (Not required)

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 o
Accelerated filer o
Non-accelerated filer o
Smaller reporting company ý

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes   ý No
 
As of August 15,November 14, 2016,,  registrant had outstanding 13,205,450 shares of common stock, no par value.value of registrant were outstanding.
 
 
 
Index

 
 
 
 Page
PART I  FINANCIAL INFORMATION
 
 
Item 1. Financial Statements for the period ended June 30September30, 2016
 
          Consolidated Balance Sheets (Unaudited)
  3
          Consolidated Statements of Operations (Unaudited)
  4
          Consolidated Statements of Cash Flows (Unaudited)
5
          Notes to Consolidated Financial Statements
  6
  
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations8
Item 3. Quantitative and Qualitative Disclosures About Market Risk10
Item 4. Controls and Procedures10
Item 4T. Controls and Procedures10
  
PART II  OTHER INFORMATION 
  
Item 1. Legal Proceedings11
Item 1A. Risk Factors11
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds11
Item 3. Defaults Upon Senior Securities11
Item 4. Mine Safety11
Item 5. Other Information11
Item 6. Exhibits12
  
Signatures13
  
 
 
 
- 2 -
 
 
PART I  FINANCIAL INFORMATION
 
Item 1.  Financial Statements
 
HOME TREASURER FINDERS, INC. AND SUBSIDIARY
 Consolidated Balance Sheets
 
          
 June 30,  December 31,  September 30,  December 31, 
 2016  2015  2016  2015 
 (unaudited)    (unaudited)    
AssetsAssets   Assets    
          
Current Assets:          
Cash $49,402  $45,210  $45,827  $45,210 
Rent receivable  500   500   500   500 
Prepaid expenses  5,445   706   2,729   706 
Total current assets  55,347   46,416   49,056   46,416 
                
Property and equipment, net  832,175   843,106   826,172   843,106 
                
Other assets:                
Security deposits  1,050   1,050   1,050   1,050 
                
Total assets $888,572  $890,572  $876,278  $890,572 
                
Liabilities and Shareholders' Equity (Deficit)Liabilities and Shareholders' Equity (Deficit)     Liabilities and Shareholders' Equity (Deficit)     
                
Liabilities:                
Accounts payable $19,277  $-  $16,900  $- 
Accrued wages  18,612   18,612   18,612   18,612 
Accrued liabilities  72,617   68,187   70,915   68,187 
Accrued interest – related party  2,965   2,781   3,090   2,781 
Note payable, current portion  11,704   13,265   10,913   13,265 
Related party note payable  1,258   9,193   3,145   9,193 
Total current liabilities  126,433   112,038   123,575   112,038 
                
Long term debt, net of current portion  806,367   811,654   803,643   811,654 
Total liabilities  932,800   923,692   927,218   923,692 
                
Shareholders' equity (deficit):                
Common stock, no par value; 100,000,000 shares authorized,                
13,205,450 and 13,205,450 shares issued and outstanding, respectively  215,267   215,267   215,267   215,267 
Additional paid in capital  96,476   96,476   96,476   96,476 
Accumulated deficit  (355,971)  (344,863)  (362,683)  (344,863)
Total shareholders' equity (deficit)  (44,228)  (33,120)
Total shareholder's equity (deficit)  (50,940)  (33,120)
                
Total liabilities and shareholders' equity (deficit) $888,572  $890,572  $876,278  $890,572 
 
 
 
See accompanying notes to consolidated financial statements.
 
 
 
 
- 3 -
 
 
 
 
HOME TREASURER FINDERS, INC. AND SUBSIDIARY
 Consolidated Statements of Operations
(Unaudited)
 
  For the Three Months Ended  For the Six Months Ended 
  June 30,  June 30, 
  2016  2015  2016  2015 
         
Commission income $72,492  $56,137  $120,518  $73,542 
Rental and property and rental management income  60,025   58,904   116,930   110,742 
Revenue $132,517  $115,041  $237,448  $184,284 
                 
Operating expnses:                
Commision expense  42,919   27,177   47,722   30,417 
Professional fees  9,939   8,349   26,218   22,341 
General and administrative  81,668   59,994   145,665   123,732 
Total operating expenses  134,526   95,520   219,605   176,490 
                 
Operating (loss) income  (2,009)  19,521   17,843   7,794 
                 
Other expense                
Interest expense  (14,367)  (14,764)  (28,951)  (29,579)
                 
Total other expense  (14,367)  (14,764)  (28,951)  (29,579)
                 
Net income (loss) income $(16,376) $4,757  $(11,108) $(21,785)
                 
Basic and diluted (loss) income per share $(0.00) $0.00  $(0.00) $(0.00)
                 
Basic and diluted weighted average                
common shares outstanding  13,205,450   13,205,450   13,205,450   13,205,450 
  For the Three Months Ended  For the Nine Months Ended 
  September 30,  September 30, 
  2016  2015  2016  2015 
             
Commission income $44,535  $73,928  $165,053  $147,470 
Property and rental management income  59,726   29,391   176,657   140,134 
Revenue $104,261  $103,319  $341,710  $287,604 
                 
Operating expenses:                
Commission expense  4,448   41,257   52,170   71,674 
Professional fees  7,713   5,419   33,931   27,760 
General and Administrative  84,393   61,975   230,060   185,708 
Total operating expenses  96,554   108,651   316,161   285,142 
                 
Operating income (loss)  7,707   (5,332)  25,549   2,462 
                 
Other income (expense)                
Other income  -   -   -   - 
Interest expense  (14,418)  (14,738)  (43,369)  (44,318)
                 
Total other income (expense)  (14,418)  (14,738)  (43,369)  (44,318)
                 
Income (loss) before taxes  (6,711)  (20,070)  (17,820)  (41,856)
                 
Income tax expense  —   —   —   — 
                 
Net income (loss) $(6,711) $(20,070) $(17,820) $(41,856)
                 
Basic and diluted loss per share $(0.00) $(0.00) $(0.00) $(0.00)
                 
Basic and diluted weighted average                
common shares outstanding  13,205,450   13,205,450   13,205,450   13,205,450 
 
 
 
See accompanying notes to consolidated financial statements.
 
 
 
 
- 4 -
 

 

HOME TREASURER FINDERS, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Unaudited)
 
 
  For the Nine Months Ended 
  September 30, 
  2016  2015 
Cash flows from operating activities:      
Net income (loss) $(17,820) $(41,856)
Adjustments to reconcile net loss to net cash provided        
(used) by operating activities:        
Depreciation and amortization  17,874   19,638 
Changes in operating assets and liabilities:        
Increase in rent receivable  -   (500)
Increase in prepaid expense  (2,023)  (5,783)
Increase in accrued interest related party  309   550 
Increase in accrued liabilities  2,728   20,778 
Increase in accounts payable  16,900   1,248 
Net cash provided by (used in)        
operating activities  17,968   (5,925)
         
Cash flows from investing activities:        
Cash paid for fixed assets  (940)  (831)
Net cash used in investing activities  (940)  (831)
         
Cash flows from financing activities:        
Proceeds from related party payable  3,145   1,500 
Payment of related party payable  (9,193)  - 
Payment of long term debt  (10,363)  (9,719)
Net cash provided by (used in)        
financing activities  (16,411)  (8,219)
         
Net change in cash  617   (14,975)
         
Cash, beginning of period  45,210   36,848 
         
Cash, end of period $45,827  $21,873 
         
Supplemental disclosure of cash flow information:        
Cash paid during the period for:        
Income taxes $—  $— 
Interest $32,591  $— 
         
NON CASH FINANCING ACTIVITIES:        
  None   —   — 
  For the Six Months Ended 
  June 30, 
  2016  2015 
Cash flows from operating activities:    
Net loss $(11,108) $(21,785)
Adjustments to reconcile net loss to net cash        
used by operating activities:        
Depreciation and amortization  11,871   13,092 
Changes in operating assets and liabilities:        
Increase in rent receivable  —   (24,000)
Increase in prepaid expense  (4,739)  (445)
Increase in accrued interest - related party  184   345 
Increase in accrued liabilities  4,430   8,545 
Increase in accounts payable  19,277   21,333 
Net cash provided by (used in)        
operating activities  19,915   (2,915)
         
Cash flows from investing activities:        
Purchase of fixed assets  (940)  — 
Net cash used in        
investing activities  (940)  — 
         
Cash flows from financing activities:        
Proceeds from related party payable  1,258   1,500 
Payment of  related party payable  (9,193)  - 
Payment of long term debt  (6,848)  (6,445)
Net cash provided by (used in)        
financing activities  (14,783)  (4,945)
         
Net change in cash  4,192   (7,860)
         
Cash, beginning of period  45,210   36,848 
         
Cash, end of period $49,402  $28,988 
         
Supplemental disclosure of cash flow information:        
Cash paid during the period for:        
Income taxes $—  $— 
Interest $28,767  $29,235 
         
NON CASH FINANCING ACTIVITIES:        

 
 
See accompanying notes to consolidated financial statements.
 
 
 
 
- 5 -
 
 

 
HOME TREASURE FINDERS, INC. AND SUBSIDIARY

Notes to Unaudited Consolidated Financial Statements
 

Note 1:  Basis of Presentation

The accompanying financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). The interim financial statements reflect all adjustments, consisting of normal recurring adjustments which, in the opinion of management, are necessary to present a fair statement of the results for the period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the December 31, 2015 financial statements and notes thereto included. The results of operations for the period ended JuneSeptember 30, 2016, are not necessarily indicative of the operating results for the year ended December 31, 2016.


Note 2:  Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.   As shown in the accompanying financial statements, the Company has not yet generated sufficient net income.  This factor,These factors, among others, indicates that there is substantial doubtmay indicate that the Company will be ableunable to continue as a going concern for a reasonable period of time.

The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.  The Company's continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain profitability.  The Company intends to seek additional funding through equity offerings to fund its business plan.  There is no assurance that the Company will be successful in raising additional funds. 


Note 3:  Related Party Transactions

During the sixnine months ended JuneSeptember 30, 2016, the related party payable had a net decrease of $7,935.$6,048.  During the three months ended JuneSeptember 30, 2016 the related party payable increased by $1,258.$1,887.  The balance of the related party payable was $1,258$3,145 and $9,193 as of JuneSeptember 30, 2016 and December 31, 2015, respectively.  This payable is due on demand and has an interest rate of 8%.  Accrued interest on this payable was $2,965$3,090 and $2,370$2,781 at JuneSeptember 30, 2016 and December 31, 2015, respectively.  Interest expense for the sixnine months ended JuneSeptember 30, 2016 and 2015 was $184$309 and $345,$505, respectively.  Interest expense on this liability for the three months ended JuneSeptember 30, 2016 and 2015 was $13$125 and $174,$205, respectively.
 
 
 
 
- 6 -
 
 
 
 
HOME TREASURE FINDERS, INC. AND SUBSIDIARY

Notes to Unaudited Consolidated Financial Statements



Note 4:  Property and Equipment


The Company's capital assets consist of warehouse units, computer equipment, office furniture and leasehold improvements for the new office.  Depreciation and amortization is calculated using the straight-line method over the estimated useful life of the asset, ranging from 18 months to 39 years.  Expenditures for additions and improvements are capitalized, while repairs and maintenance costs are expensed as incurred.  The cost and related accumulated depreciation of any capital assets that are sold or otherwise disposed of are removed from the accounts and any gain or loss is recorded in the year of disposal.

Fixed assets and related depreciation are as follows: 
 
  
June 30,
2016
  
December 31,
2015
 
Computer equipment $5,672  $5,672 
Furniture and fixtures  7,777   6,837 
Leasehold improvements  4,000   4,000 
Warehouse units  861,000   861,000 
Accumulated amortization and depreciation  (46,274)  (34,403)
     Total fixed assets $832,175  $843,106 
  
September 30,
2016
  
December 31,
2015
 
Computer equipment $5,672  $5,672 
Furniture and fixtures  7,777   6,837 
Leasehold improvements  4,000   4,000 
Warehouse units  861,000   861,000 
Accumulated amortization and depreciation  (52,277)  (34,403)
     Total fixed assets $826,172  $843,106 

Depreciation and amortization expense was $11,871$17,874 and $13,092$17,638 for the sixnine months ended JuneSeptember 30, 2016 and 2015, respectively.  ForAmortization expense was $0 and $2,000 for the nine months ended September 30, 2016 and 2015, respectively.

Depreciation expense was $6,003 and $5,879 for the three months ended JuneSeptember 30, 2016 and 2015, depreciation and amortizationrespectively.  Amortization expense was $5,935$0 and $6,546,$667 for the three months ended September 30, 2016 and 2015, respectively.

Note 5:  Long-Term Debt

On September 15, 2014,  the Company entered into a promissory note for $840,000 on the purchase three warehouse units known as 4420, 4430 and 4440 Garfield Street, Denver, Colorado. The Company is leasing each of the three separate units to licensed third party growers for cannabis cultivation.  The terms of the variable interest 25 year amortization note carried by the seller of the property call for payments to seller as follows:
 

1 First and Second year interest rate at 7% with 25 year amortization payment at $5,937 per month.
2. Third and Fourth year at 8% with 25 year amortization payment at $6,278 per month.
3. Fifth year at 9% with 25 year amortization payment at $6,640 per month.
4. Balloon payment of $777,255 due at end of the fifth year.
 
- 7 -
 
 
 
 
HOME TREASURE FINDERS, INC. AND SUBSIDIARY

Notes to Unaudited Consolidated Financial Statements

 
Note 5:  Debt (continued)
The note to seller is secured by the three warehouse units.

As of JuneSeptember 30, 2016, the balance of the note was $818,071$814,556 and the annual maturities of the long-term debt were:
 
Year Ending December 31,    
2016 $6,417  $2,902 
2017  10,790   10,790 
2018  11,090   11,090 
2019  789,774   789,774 
        
 $818,071  $814,556 

 
Note 6:  Subsequent Events
 

On October 25, 2016, the Company entered into a new lease for office space.  The space is next door to the Company's current location in a larger space.  We are leasing this facility at a monthly payment of $1,400 for the term of the lease which ends on March 31, 2018.

The Company has evaluated all other subsequent events pursuant to ASC Topic 855 and has determined that there are no events that require disclosure as of the date of issuance.
 
 
- 8 -
 
 
 
 
Part I. Item 2.  Management's Discussion and Analysis of Financial Conditions and Results of Operations

Forward-looking statements

The following discussion should be read in conjunction with the financial statements of Home Treasure Finders, Inc. and Subsidiaries (the "Company"), which are included elsewhere in this Form 10-Q. This Quarterly Report on Form 10-Q contains forward-looking information. Forward-looking information includes statements relating to future actions, future performance, costs and expenses, interest rates, outcome of contingencies, financial condition, results of operations, liquidity, business strategies, cost savings, objectives of management, and other such matters of the Company. The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking information to encourage companies to provide prospective information about themselves without fear of litigation so long as that information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the information. Forward-looking information may be included in this Quarterly Report on Form 10-Q or may be incorporated by reference from other documents filed with the Securities and Exchange Commission (the "SEC") by the Company. You can find many of these statements by looking for words including, for example, "believes", "expects", "anticipates", "estimates" or similar expressions in this Quarterly Report on Form 10-Q or in documents incorporated by reference in this Quarterly Report on Form 10-Q. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events.

We have based the forward-looking statements relating to our operations on our management's current expectations, estimates and projections about our Company and the industry in which we operate. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In particular, we have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, our actual results may differ materially from those contemplated by these forward-looking statements. Any differences could result from a variety of factors, including, but not limited to general economic and business conditions, competition, and other factors.

Financial Condition and Results of Operation

Home Treasure Finders, Inc. was formed on July 28, 2008. The founder, sole director and officer of our company is Corey Wiegand. On March 3, 2014 we formed a wholly owned subsidiary, HMTF Cannabis Holdings, Inc. to purchase properties that qualify for legal cultivation of cannabis. 

Our net loss for the sixnine months ended JuneSeptember 30, 2016 was $11,108.$17,820.  We generated operating revenue from three sources, sales commissions, property management, and commercial real estate for legal cannabis cultivation. We manage approximately 6065 rental real estate owned by non-related third parties. In comparison our net loss for the sixnine months ended JuneSeptember 30, 2015 was $21,785.$41,856.

For the sixnine months ended JuneSeptember 30, 2016 the Company generated a total of $237,448$341,710 in revenues, consisting of $120,518$165,053 from sales commissions and $116,931$176,656 from rental and property management.  During the sixnine months ended JuneSeptember 30, 2015 we generated a total of $184,284$287,604 in revenues, consisting of $73,542$147,470 from sales commissions and $110,742$140,134 from rental and property management.

During the sixnine months ending JuneSeptember 30, 2016 we incurred operating expenses totaling $219,605.$316,161. Such expenses consisted primarily of commissions paid on the revenue earned, general and administrative expenses, property management expenses and professional fees.  During the sixnine months ended JuneSeptember 30, 2015 we incurred a total of $176,490$285,142 of operating expenses consisting primarily of commissions paid on the revenue earned, general and administrative expenses and professional fees.  The increase in expenses over prior year was primarily related to increase in audit and legal fees and increase in property management expenses and other administrative expenses.

Our net loss for the three months ended JuneSeptember 30, 2016 and 2015 was $16,376.$6,711 and $20,070, respectively.  For the three months ended June 30, 2015 we had net income of $4,757.   For the three months ended JuneSeptember 30, 2016 the Company generated a total of $132,517$104,261 in revenues, consisting of $72,492$44,535 from sales commissions and $60,025$59,726 from rental and property management.  During the three months ended JuneSeptember 30, 2015 we generated a total of $115,041$103,319 in revenues, consisting of $56,137$73,928 from sales commissions and $58,904$29,391 from rental and property management.

During the three months ending JuneSeptember 30, 2016 we incurred operating expenses totaling $134,526.$96,554. Such expenses consisted primarily of commissions paid on the revenue earned, general and administrative expenses, property management expenses and professional fees.  During the three months ended JuneSeptember 30, 2015 we incurred a total of $95,520$108,651 of operating expenses consisting primarily of commissions paid on the revenue earned, general and administrative expenses and professional fees.  The increasedecrease in expenses over prior year was primarily related to increasea decrease in commissions being paid and increase in property management expenses and other administrative expenses.out.
 
 
 
- 9 -




Liquidity and Capital Resources
 
At JuneSeptember 30, 2016, we had $49,402$45,827 in cash and working capital deficit of $71,086.$74,519.  At December 31, 2015 we had $45,210 in cash and a working capital deficit of $65,622.

The business plan of our subsidiary, HMTF Cannabis Holdings, Inc. is capital intensive and requires that we raise significant additional capital to acquire and improve real estate. We are negotiating with various sources for an equity infusion to match our long term capital needs.
 
 
Item 3. Quantitative and Qualitative Disclosures About Market Risk

No response required.
 

Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that information required to be disclosed in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the United States Securities and Exchange Commission. Our Chief Executive Officer has reviewed the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 Rules 13a-14(c) and 15d-14(c)) within the end of the period covered by this Quarterly Report on Form 10-Q and has concluded that the disclosure controls and procedures are ineffective to ensure that material information relating to the Company is recorded, processed, summarized, and reported in a timely manner. There were no changes in our internal controls or in other factors that could materially affect these controls subsequent to the last day they were evaluated by our Chief Executive Officer, who is our principal executive officer and our principal financial officer.
 

Item 4T.  Changes in Internal Controls over Financial Reporting

There have been no changes in our internal control over financial reporting during the last quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
 


- 10 -




Part 2.    Other Information

Item 1 -  Legal Information.
 
No response required.
 
 
Item 1A.  Risk Factors

No response required.
 
 
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
 
None.
 
 
Item 3 -  Defaults Upon Senior Securities.
 
No response required.
 

Item 4 -  Mine Safety.
 
No response required.
 

Item 5 -  Other Information.
 
No response required.
 
 
 
- 11 -
 
 
 

Item 6 -  Exhibits and Reports on Form 8-K.

(a)       Exhibits:
 
 
Exhibit
Number
 
 
 
Description
 
    
31.1 Certification of CEO/CFO pursuant to Sec. 302 
32.1 Certification of CEO/CFO pursuant to Sec. 906 
 99.1Settlement Agreement And Mutual Release
101.DEF XBRL Taxonomy Extension Definition Linkbase Document* 
101.INS XBRL Instance Document 
101SCH XBRL Taxonomy Extension Schema Document 
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document 
101.LAB XBRL Taxonomy Extension Label Linkbase Document 
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document 
101.DEF XBRL Taxonomy Extension Definition Linkbase Document 
 
(b)           Reports on Form 8-K:

None.
 
 
- 12 -


 


SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 HOME TREASURE FINDERS, INC. AND SUBSIDIARY
 (Registrant)
   
   
DATE:   August 15,November 14, 2016BY:  /s/ Corey Wiegand
  Corey Wiegand
  President
 
 
 
 
 
 
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