As filed
with the Securities and Exchange Commission, May 30,2008
Registration
No. 333-145409
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM
S-1
REGISTRATION
STATEMENTUNDERTHE SECURITIES ACT OF 1933
TIMESHARE
HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
Nevada
(State
or Other Jurisdiction of
Incorporation
or Organization)
|
6163
(Primary
Standard Industrial
Classification
Code Number)
|
88-0476779
(IRS
Employer
Identification
No.)
|
2350
S. Jones Blvd., Ste. 101
Las
Vegas, NV 89146
702-215-5830
(Address
and telephone number of registrant’s principal offices)
InCorp
Services, Inc.
3115
E Patrick Lane
Las
Vegas, NV 89120-3481
702-866-2500
(Name,
address and telephone number of agent for service)
Copies
to:
Richard
A. Friedman, Esq.
Sichenzia
Ross Friedman Ference LLP
61
Broadway
New
York, NY 10006
(212)
930-9700
(212)
930-9725 Fax
Approximate date of commencement of
proposed sale to the public: As soon as practical after the Registration
Statement becomes effective.
If any
securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, other
than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this
Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this
Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. [ ]
If
delivery of the prospectus is expected to be made pursuant to Rule 434, please
check the following box. [ ]
EXPLANATORY
NOTE
THIS
POST-EFFECTIVE AMENDMENT DOES NOT INVOLVE THE REGISTRATION OF ANY NEW SHARES OF
COMMON STOCK. RATHER, THIS FILING UPDATES THE REGISTRATION OF THE COMMON STOCK
ORIGINALLY REGISTERED ON FORM SB-2 FILED ON AUGUST 12, 2008.
PRELIMINARY
PROSPECTUS
|
Subject to Completion dated May 30,
2008
|
TIMESHARE
HOLDINGS, INC.
10,383,374
SHARES OF COMMON STOCK BY SELLING SHAREHOLDERS
10,000,000
SHARES OF COMMON STOCK BY TIMESHARE HOLDINGS, INC.
$0.10
Per Share
This
prospectus relates to 20,383,374 shares of common stock of Timeshare Holdings,
Inc., a Nevada corporation. 10,383,374 of these shares have already been issued
to the selling security holders in private placement transactions which were
exempt from the registration and prospectus delivery requirements of the
Securities Act of 1933, as amended. An additional 10,000,000 new shares of
Common Stock are being offered by Timeshare Holdings, Inc. The 10,000,000 new
shares are being offered for a period of 180 days from the date of this
prospectus, subject to an extension of up to an additional 90-day period
.
We will not receive any of the
proceeds from the sale of those shares being sold by the selling security
holders. The selling security holders may sell their shares in sales in the open
market or in privately negotiated transactions. We will receive proceeds of up
to $1,000,000 from the sale of the 10,000,000 shares being offered by Timeshare
Holdings, Inc.
The
resale of the shares or the sale of new shares is not being underwritten. The
selling security holders may sell or distribute the shares, from time to time,
depending on market conditions and other factors, through underwriters, dealers,
brokers or other agents, or directly to one or more purchasers. The offering
price may be the market price prevailing at the time of sale or a privately
negotiated price. Pursuant to the registration rights granted by us to the
selling security holders, we are obligated to register the shares held by the
selling security holders. We are paying substantially all expenses incidental to
registration of the shares.
The
10,000,000 shares offered by Timeshare Holdings are on a best efforts basis
directly through our officers and directors. No commission or other compensation
related to the sale of the shares will be paid to our officers and directors.
Our officers and directors will not register as broker-dealers with the
Securities and Exchange Commission in reliance on Rule 3a4-1 of the Securities
Exchange Act. We have not entered into any underwriting agreement, arrangement
or understanding for the sale of shares being offered, but may engage registered
broker-dealers to offer or sell the shares in the future. In the event we retain
a broker who may be deemed an underwriter, we will file a post-effective
amendment to this registration statement with the Securities and Exchange
Commission.
Your
investment in our units involves a high degree of risk. See “Risk Factors”
starting on page 6 for certain information you should consider before you
purchase the shares.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
The date
of this prospectus is May *, 2008
TABLE
OF CONTENTS
|
|
|
|
|
|
Risk
Factors
|
6
|
Special
Note Regarding Forward-Looking Statements
|
|
Use
of Proceeds
|
14
|
Market
for Common Equity and Related Stockholder Matters
|
|
Determination
of Offering Price
|
15
|
|
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
18
|
|
|
Description
of Property
|
27
|
|
|
Directors,
Executive Officers, Promoters and Control Persons
|
29
|
|
|
Certain
Relationships and Related Transactions
|
31
|
Security
Ownership of Certain Beneficial Owners and
Management
|
|
Description
of Securities
|
34
|
|
|
Plan
of Distribution
|
38
|
Limitation
of Liability and Indemnification of Officer and Directors;
Insurance
|
|
Disclosure
of Commission Position on Indemnification for Securities Act
Liabilities
|
41
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
|
Legal
Matters
|
42
|
|
|
Additional
Information
|
42
|
|
|
|
|
You
should rely only on the information contained in this prospectus. We have not
authorized anyone to provide you with information different from that which is
contained in this prospectus. This prospectus may be used only where it is legal
to sell these securities. The information in this prospectus may only be
accurate on the date of this prospectus, regardless of the time of delivery of
this prospectus or of any sale of securities.
PROSPECTUS
SUMMARY
This
summary highlights information contained elsewhere in this prospectus. This
summary does not contain all of the information you should consider before
investing in our common stock. You should read the entire prospectus carefully,
especially the “Risk Factors” section and our financial statements and the
related notes appearing at the end of this, before deciding to invest in our
common stock. As used throughout this prospectus, the terms “Timeshare,”
“Timeshare Holdings”, the “Company,” “we,” “us,” and “our” refer to Timeshare
Holdings Inc.
TIMESHARE
HOLDINGS, INC.
Our
business focuses on the market niche in the vacation ownership financing
business segment. Our business was established to provide financing for
consumers wishing to purchase and/or refinance vacation ownership intervals in
the secondary, or resale market or elsewhere. We intend to focus on originating
short-term, high-yield consumer notes. Both fee simple and non-fee simple
licensed timeshare interests collateralize the notes.
Timeshare
Holdings, Inc.’s principal executive offices are located at 2350 South Jones
Boulevard, Suite 101, Las Vegas, Nevada 89146 and its California office is
located at 16842 Von Karman Avenue, Building. 400, Second Floor, Irvine,
California 92606. Our telephone number in Nevada is (877) 220-6404 and its
telephone number in California is (800) 882-4524. Our website address is
www.timeshareloans.com. Our website and the information contained on our
website are not incorporated into this prospectus or the registration statement
of which it forms a part. Further, our references to the URLs for these websites
are intended to be inactive textual references only.
Our
Corporate History
TimeShareLoans.com,
Inc. was established in July 2005 to provide financing for consumers wishing to
purchase and/or refinance vacation ownership intervals in the secondary, or
resale market, or elsewhere. We intend to focus on originating short-term,
high-yield consumer notes. Both fee simple and non-fee simple licensed timeshare
interests collateralize the notes.
On March
9, 2007 we acquired TimeShareLoans.com, Inc. by entering into an Agreement and
Plan of Reorganization (the “Agreement”) with TimeShareLoans.com, Inc. Pursuant
to the terms of the Agreement, the respective shareholders of
TimeShareLoans.com, Inc. exchanged their outstanding shares in
TimeShareLoans.com, Inc. for shares in TimeShare Holdings (the “business
combination”). As a result of the business combination as set forth in the
Agreement, TimeShare Holdings became the parent company of TimeShareLoans.com,
Inc. and we took over all the business operations of TimeShareLoans.com, Inc.
Upon the closing of the business combination, a total of 1,182,680 shares of
TimeShareLoans.com, Inc. common stock were exchanged for 29,991,000 shares of
common stock in TimeShare Holdings.
About
this offering
This
prospectus relates to a total of 20,383,374 shares of common stock of Timeshare
Holdings, Inc., a Nevada corporation.
An
aggregate of up to 10,383,374 shares of our common stock may be offered and sold
pursuant to this Prospectus by the selling security holders. The selling
security holders acquired these shares from us in a series of private placements
conducted between January 2007 and March 2007.
We are
also offering a maximum of 10,000,000 new shares of common stock on a best
efforts basis. There is no commitment on the part of any person to purchase and
pay for any shares.
Number
of shares outstanding after this offering
There are
currently 30,167,000 shares of our common stock issued and outstanding. If we
sell the entire 10,000,000 being offered by us, we will have 40,167,000 shares
of our common stock issued and outstanding. We have no other securities issued
or outstanding.
Estimated
use of proceeds
We will
not receive any of the proceeds resulting from the sale of the shares held by
the selling security holders.
We may
receive up to $1,000,000 from the shares being offered by Timeshare Holdings.
Any proceeds from the sale of these shares will be immediately available to
Timeshare Holdings. We intend to use funds received in this offering for the
payment of deeded loan fundings, start-up expenses, ongoing operating expenses,
debt service and accumulated accounts payable as set forth in the Use of
Proceeds on page 14.
RISK
FACTORS
You
should carefully consider the following risk factors in evaluating our business
before you buy any of our common stock. Buying our common stock is speculative
and involves many risks. You should not buy our common stock unless you can
afford to lose the entire amount of your investment.
Risks related to Timeshare’s
financial results:
We
are a recently formed development stage company that has not achieved profitable
operations. If our business plan fails, you may lose your entire
investment.
It is management’s belief and determination that the company
is a going concern, which has been confirmed in the audit report of our
independent auditors. During the 3 month period ended March 31, 2008 our net
losses have been $57,280. Since we have no record of profitable
operations, there is a high possibility that you may suffer a complete loss of
your investment.
Shares
of stock eligible for sale by our stockholders and new shares being offered may
decrease the price of our stock.
We are registering the sale of up to
10,383,374 shares of common stock held by our shareholders and an additional
10,000,000 shares of our authorized common for a total of 20,383,374 shares of
common stock. We currently have 30,167,000 shares issued and outstanding. This
constitutes up to 75.5% of our total shares issued and outstanding today.
Potentially, all 10,383,374 shares could be sold on the open market by our
selling shareholders, subject to Rule 144 limitations for sales by corporate
insiders. If the shareholders sell substantial amounts of our stock, then the
market price of our stock could decrease.
Our
independent auditors have expressed substantial doubt about our ability to
continue as a going concern, which may hinder our ability to obtain further
financing and which may force us to cease operations.
In their
report dated April 11, 2008, our independent auditors, Chisholm, Bierwolf and
Nilson, LLC, certified public accountants, have stated that our financial
statement for the year ended December 31, 2007 were prepared assuming that we
would continue as a going concern. Our ability to continue as a going
concern is an issue raised as a result of recurring losses from operations and
cash flow deficiencies since our inception. We continue to experience
net losses. Our ability to continue as a going concern is subject to
our ability to generate a profit and/or obtain necessary funding from outside
sources, including obtaining additional funding from the sale of our securities,
increasing sales or obtaining loans and grants from various financial
institutions where possible. If we are unable to continue as a going
concern, you may lose your entire investment.
Timeshare
Holdings is at an early stage of development and has a limited operating
history.
Timeshare Holdings subsidiary, TimeShareLoans.com., through
which it primarily conducts its operations, was formed in 2005 operating as a
private company formed under the laws of the state of Nevada. As such, it
has a limited operating history upon which you can base an evaluation of its
business and prospects. As a start-up company in the early stage of development,
there are substantial risks, uncertainties, expenses and difficulties Timeshare
Holdings is subject to. You should consider an investment in Timeshare Holdings
in light of these risks, uncertainties, expenses and difficulties. To address
these risks and uncertainties, Timeshare Holdings must do the
following:
|
§
|
Successfully
execute its business strategy;
|
|
§
|
Respond
to competitive developments; and
|
|
§
|
Attract,
integrate, retain and motivate qualified
personnel.
|
Timeshare
Holdings may be unable to accomplish one or more of these objectives, which
could cause its business to suffer. In addition, accomplishing one or more of
these objectives might be very expensive, which could harm its financial
results.
We
have a history of losses since our inception which may continue, and which may
result in our inability to fund any of our sales and marketing and research and
development activities. As a result we maybe forced to cease our operations and
cause investors to lose this entire investment.
We have incurred
a net loss of $57,280 for the three months ended March 31, 2008, a net
loss of $5,979,396 for the year end December 31, 2006,
a net loss of
$402,509 for the year ended December 31, 2007
and an
accumulated net loss of $6,622,132 from July 12, 2005 (inception) through March
31, 2008
.
As of
March 31, 2008 we had working capital deficiency of $547,863. Because of these
conditions, we will require working capital to develop our business operations.
We have not achieved profitability and we can give no assurances that we will
achieve profitability within the foreseeable future, as we fund operating and
capital expenditures, in such areas as sales and marketing and research and
development. We cannot assure investors that we will ever achieve or sustain
profitability or that our operating losses will not increase in the future. If
we continue to incur losses, we will not be able to fund any of our sales and
marketing and research and development activities, and we may be forced to cease
our operations. If we are forced to cease operations, investors will lose the
entire amount of their investment.
Risks related to Our
Business:
Timeshare
Holdings will need to increase the size of its organization, and may experience
difficulties in managing growth.
Timeshare Holdings is a small company
with minimal employees as of March 31, 2008. Timeshare Holdings expects to
experience a period of significant expansion in headcount, facilities,
infrastructure and overhead and anticipates that further expansion will be
required to address potential growth and market opportunities. Future growth
will impose significant added responsibilities on members of management,
including the need to identify, recruit, maintain and integrate managers.
Timeshare Holdings’ future financial performance and its ability to compete
effectively will depend, in part, on its ability to manage any future growth
effectively.
We are subject to
compliance with securities law, which exposes us to potential liabilities,
including potential rescission rights
. We have offered and sold our
common stock to investors pursuant to certain exemptions from the registration
requirements of the Securities Act of 1933, as well as those of various state
securities laws. The basis for relying on such exemptions is factual; that is,
the applicability of such exemptions depends upon our conduct and that of those
persons contacting prospective investors and making the offering. We have not
received a legal opinion to the effect that any of our prior offerings were
exempt from registration under any federal or state law. Instead, we have relied
upon the operative facts as the basis for such exemptions, including information
provided by investors themselves.
If any
prior offering did not qualify for such exemption, an investor would have the
right to rescind its purchase of the securities if it so desired. It is possible
that if an investor should seek rescission, such investor would succeed. A
similar situation prevails under state law in those states where the securities
may be offered without registration in reliance on the partial preemption from
the registration or qualification provisions of such state statutes under the
National Securities Markets Improvement Act of 1996. If investors were
successful in seeking rescission, we would face severe financial demands that
could adversely affect our business and operations. Additionally, if we did not
in fact qualify for the exemptions upon which it has relied, we may become
subject to significant fines and penalties imposed by the SEC and state
securities agencies.
The availability
of a large number of authorized but unissued shares of common stock may, upon
their issuance, lead to dilution of existing stockholders.
We are
authorized to issue 300,000,000 shares of common stock, $0.001 par value per
share, of which, as of March 31, 2008 30,167,000 shares of common stock were
issued and outstanding. These shares may be issued by our Board of Directors
without further stockholder approval. The issuance of large numbers of shares,
possibly at below market prices, is likely to result in substantial dilution to
the interests of other stockholders. In addition, issuances of large numbers of
shares may adversely affect the market price of our common stock.
We may need
additional capital that could dilute the ownership interest of investors.
We require substantial working capital to fund our business. If we raise
additional funds through the issuance of equity, equity-related or convertible
debt securities, these securities may have rights, preferences or privileges
senior to those of the rights of holders of our common stock and they may
experience additional dilution. We cannot predict whether additional financing
will be available to us on favorable terms when required, or at all. Since our
inception, we have experienced negative cash flow from operations and expect to
experience significant negative cash flow from operations in the future. The
issuance of additional common stock by our management, may have the effect of
further diluting the proportionate equity interest and voting power of holders
of our common stock, including investors in this offering.
An interruption
or reduction in the whole loan market would hurt our financial
performance.
In order for us to continue funding our credit financing
operations, we must be able to sell or hypothecate the timeshare mortgage and
personal loans we make to qualified financial institutions, hedge funds and/or
institutional buyers or lenders. We use the cash proceeds from these sales or
lending arrangements to pay down our own lines of credit and to make new
timeshare mortgage or personal loans. The value of our credit financing
operations and timeshare mortgage and personal loans depend on a number of
factors, including general economic conditions, interest rates and governmental
regulations. In addition, we rely on institutional purchasers, such as
investment banks, financial institutions and other mortgage lenders to purchase
or hypothecate our mortgage loans. We cannot assure that the purchasers or
lenders willing to advance funds on our consumer loans and mortgages will be
willing to purchase mortgage loans in the timeshare industry on satisfactory
terms or that the market for such loans will continue. Adverse changes in the
timeshare industry or mortgage industry may adversely affect our ability to sell
or hypothecate our mortgage and personal loans for acceptable prices or advance
rates within a reasonable period of time, which would hurt our
earnings.
If we are unable
to sell or hypothecate a significant portion of our mortgages and personal
loans, our earnings would decrease.
We earn income on our mortgages and
personal loans when they are sold or hypothecated to other financial
institutions, as well as earning income based upon our positive interest spread,
(arbitrage), the difference between our interest income and our interest
expense. Market and other considerations could affect the timing of the sale or
hypothecation of our mortgage and personal loans. If we are not able to sell or
hypothecate all of the mortgage and personal loans that we make during the
quarter in which the loans are made, we would be less likely to be profitable
for that quarter.
Changes in the
volume and cost of our credit financing and loans may decrease our loan
production and decrease our earnings.
Our earnings and financial
condition could be hurt by a decrease in volume or an increase in the cost of
the loans that we fund and are able to sell or hypothecate to other financial
institutions. A decrease in volume or an increase in the cost of our self-funded
loans could result from the competition from our own lenders and the financial
institutions to which we sell or hypothecate the mortgage and personal loan
notes.
We may be
required to replace or repurchase mortgage or personal loans or indemnify
investors if we breach representations and warranties or if the borrower
defaults, which would hurt our earnings
.
We make representations and
warranties to the lenders advancing funds against our portfolio of receivables
and purchasers of our mortgage and personal loans regarding compliance with
laws, regulations and programs standards and the accuracy of information. We are
required to repurchase or replace mortgage and personal loans which do not
conform to the representations and warranties made at the time of sale. If these
representations and warranties are breached, we would be subject to the risk
that a loan source will not have the financial capacity to repurchase loans. We
would also be subject to a risk that the loan source will not otherwise respond
to our demands. We could then become liable for damages or be required to
replace or repurchase a loan if there has been a breach of these representations
or warranties. In addition, we may be obligated to replace or buy back mortgage
and personal loans if the borrower defaults on the first payment of principal
and interest due. Such replacement or repurchase obligations could hurt our
earnings and have a material adverse effect on our financial
position.
The subprime loan
market is currently experiencing significant disruption which may have an
indirect impact on our business
.
Recently due to a number of
market factors, including increased delinquencies on mortgage loans and the
failure of certain subprime mortgage companies and hedge funds, there has been
extreme uncertainty and disruption in the subprime mortgage industry as a whole.
As a result, there has been an overall tightening of credit and credit
underwriting policies of residential mortgage lenders which may have an indirect
impact on our business.
While
Timeshare Holdings, Inc. intends to uphold its credit underwriting criteria,
offering its products only to those borrowers who qualify with above average
FICO/credit scores, amongst other criteria, the sources of capital to fund those
qualified borrowers may become more scarce and more expensive due to the lenders
aversion to risk in the current economic conditions. The Company
relies on this availability of capital to achieve its business plan goals;
without it, the Company may be hampered in it’s ability to fund all of the
prospective borrowers interested in it’s product. We are watching
developments in our business and the subprime industry closely and we will
consider all necessary or appropriate changes and strategies. There can be no
assurances that if this disruption continues that we will be able to operate our
business as we have historically.
We may not have
adequate cash to fund our operations
.
Our business operations
require continued access to adequate cash to offer credit financing to qualified
timeshare buyers and to then sell or hypothecate the notes to financial
institutions specializing in timeshare financing and other mortgages.
A period of
rising interest rates, an economic slowdown or a recession could reduce the
demand for mortgages or personal loans.
Rising interest rates affecting
the timeshare industry generally reduce the demand for consumer credit,
including mortgage and personal loans. Interest rates have been generally
ranging from 12.95% to 18.95% for timeshare mortgages and/or personal loans. In
an economic slowdown or recession, real estate values and secondary or vacation
home sales decline and the number of borrowers defaulting on their loans
increases. In a period of rising interest rates or an economic slowdown, we will
originate and sell or hypothecate fewer loans and could be required to replace
or repurchase more of the loans we have sold or hypothecated as a result of
early payment defaults by borrowers. Accordingly, a period of rising interest
rates, an economic slowdown or a recession would adversely affect our business
and results of operations.
An increase in
interest rates could reduce the value of our loan inventory.
The value of
our loan inventory is based, in part, on market interest rates. Accordingly, we
may experience losses on loan sales or hypothecations if interest rates change
rapidly or unexpectedly. If interest rates rise after we fix a price for a loan,
but before we sell or hypothecate that loan, the value of that loan may
decrease. If the amount we receive from selling or hypothecating the loan is
less than our cost of originating the loan, we may incur net losses, and our
business and operating results could be adversely affected.
The loss of key
purchasers or financial institutions willing to advance funds through
hypothecation of our loans or a reduction in prices paid could adversely affect
our financial condition.
We sell or hypothecate substantially all of the
mortgages and personal loans we originate to institutional investors or
financial institutions willing to advance funds through hypothecation. If these
banks or any other significant purchaser or lender of our loans cease to buy or
hypothecate our loans and equivalent purchasers or lenders cannot be found on a
timely basis, then our business and results of operations could be materially
adversely affected. Our results of operations could also be affected if these
banks or other purchasers or lenders lower the price they pay or advance to us
or adversely change the material terms of their loan purchases from
us.
The
prices at which we sell our loans vary over time. A number of factors determine
the price we receive for our loans. These factors include:
·
|
The
number of institutions that are willing to buy our
loans;
|
·
|
The
amount of comparable loans available for
sale;
|
·
|
The
levels of prepayments of, or defaults on,
loans;
|
·
|
The
types and volume of loans we sell;
|
·
|
The
level and volatility of interest rates;
and
|
·
|
The
quality of our loans.
|
The
advance rates offered by lenders willing to hypothecate our mortgages and
personal loans vary from time to time. Factors that may determine the advance
rate we receive from our loans could include:
·
|
The
credit worthiness of the borrower
|
·
|
The
performance of our portfolio of
loans
|
If we are unable
to implement our Internet strategy successfully our growth would be
limited.
A substantial portion of our planned future growth depends on
our ability to originate loans on the Internet. Our Internet success will
depend, in part, on the development and maintenance of the Internet's
infrastructure and consumer acceptance of the Internet as a distribution channel
for mortgages and personal loans. Internet-based mortgage lending is relatively
new, and we cannot assure you that consumers will increase their use of the
Internet for obtaining mortgage and/or personal loans. Our ability to
significantly increase the number of loans we originate over the Internet and to
continue to originate loans profitably over the Internet remains
uncertain.
The
success of our online business depends on system integrity and
security
.
The performance of our Web site and
the Web sites in which we participate is important to our reputation, our
ability to attract customers and our ability to achieve market acceptance of our
services. Any system failure that causes an interruption or an increase in
response time of our services could result in fewer loan applications through
our Web site. System failures, if prolonged, could reduce the attractiveness of
our services to borrowers and clients. Our operations are susceptible to outages
due to fire, floods, power loss, telecommunications failures, break-ins and
similar events. In addition, despite our implementation of network security
measures, our servers are vulnerable to computer viruses, break-ins and similar
disruptions from unauthorized tampering with our computer systems. We do not
carry sufficient insurance to compensate for losses that may occur as a result
of any of these events.
A
significant barrier to online commerce is the secure transmission of
confidential information over public networks. We rely on encryption and
authentication technology licensed from third parties to effect secure
transmission of confidential information, such as that required on a mortgage
loan application. Advances in computer capabilities, new discoveries in
cryptography or other developments may result in a breach of the algorithms we
use to protect customer data. If any compromise of our security occurs, it would
injure our reputation, and could adversely impact the success of our
business.
Our online
success depends on our ability to adapt to technological changes.
The
market for Internet products and services is characterized by rapid
technological developments, evolving industry standards and frequent new
products and enhancements. As technological advances occur, and consumer
expectations increase, we may be required to make significant changes to the
design and content of our Web site to compete effectively. As the number of Web
pages and users increases, we will need to modify our Internet infrastructure
and our Web site to accommodate increased traffic. If we cannot modify our
Internet systems, we may experience:
§
|
impaired
quality and speed of application processing;
and
|
§
|
delays
in reporting accurate interest rate
information.
|
If
we fail to effectively adapt to increased usage of the Internet or new
technological developments, our business will be adversely affected.
We
face unknown risks associated with the establishment of our business segments
that we intend to build around the development of resale broker network and a
network specifically for Homeowner Associations and Property Management
companies.
These
risks are difficult to quantify, however, it is our judgment that we may
face:
·
|
Potential
for Developers to create their own resale outlet with their own
financing
|
·
|
The
ability to replace defaulted
contracts
|
·
|
Business
concentration located in areas where the Company is not licensed to do
business
|
·
|
The
impact on our program that may result of factors outside of our control
such as general economic conditions, changes in traveling or vacationing
habits or trends amongst consumers, or the impact of Association
assessments and/or special
assessments.
|
If we
fail to effectively establish new business segments such as resale broker
network and Homeowner Associations and Property Management companies, our
business will be adversely affected by negatively impacted
revenues.
We face intense
and increasing competition that could adversely impact our market share and our
revenues
.
We face
increasing competition from Internet-based lending companies and other timeshare
mortgage lenders participating on Web sites, as well as from traditional
mortgage lenders, such as commercial banks, savings and loan associations and
other finance and mortgage banking companies. Entry barriers in the mortgage
industry are relatively low and increased competition is likely. As we seek to
expand our business, we will face a greater number of competitors, many of whom
will be well-established in the vacation ownership and timeshare markets we seek
to penetrate. Many of our potential competitors are much larger than we are,
have better name recognition than we do and have far greater financial and other
resources. We cannot assure you we will be able to effectively compete against
them or any future competitors.
Competition
may lower the rates we are able to charge borrowers, thereby potentially
lowering the amount of premium income on future loan sales. Increased
competition also may reduce the volume of our loan originations and loan sales.
We cannot assure you that we will be able to compete successfully in this
evolving market.
Changes in the
timeshare industry could affect our operations.
We operate within the
timeshare industry. Our results of operations and financial position could be
negatively affected by any of the following events:
·
|
An
oversupply of timeshare units;
|
·
|
A
reduction in demand for timeshare
units;
|
·
|
Changes
in travel and vacation patterns;
|
·
|
Negative
publicity about the timeshare
industry
|
We may be
impacted by general economic conditions
.
Our customers may be more
vulnerable to deteriorating economic conditions than those in the luxury or
upscale timeshare markets. An economic slowdown in the United States could
depress consumer spending for vacation intervals. Further, during an economic
slowdown we could experience increased delinquencies in the payments of notes
owed to us.
We are at risk
for defaults by our customers
.
We offer financing to the
buyers of vacation intervals. We focus on originating short-term, high-yield
consumer notes. We bear the risk of default on these notes. When a buyer of a
Vacation Interval defaults, we may have recourse against a Vacation Interval
buyer for the unpaid price, but certain states have laws that limit our ability
to recover personal judgments against customers who have defaulted on their
loans. Accordingly we may chose to restate the terms of the loan obligation,
and/or foreclose on a loan obligation secured by a deeded vacation interval, and
will always pursue a vigorous collection effort on each and every delinquent
consumer to prevent an event of default.
We must comply
with numerous government regulations and we are subject to changes in law that
could increase our costs and adversely affect our business
.
Our business is subject to
the laws, rules and regulations of various federal, state and local government
agencies regarding the origination, processing, underwriting, sale and servicing
of mortgage loans. These laws, rules and regulations, among other things, limit
the interest rates, finance charges and other fees we may charge, require us to
make extensive disclosure, prohibit discrimination and impose qualification and
licensing obligations on us. They also impose on us various reporting and net
worth requirements. We also are subject to inspection by these government
agencies. Our failure to comply with these requirements could lead to, among
other things, the loss of approved status, termination of contractual rights
without compensation, demands for indemnification or mortgage loan repurchases,
class action lawsuits and administrative enforcement actions.
The
timeshare and vacation ownership industry is regulated by both state and federal
agencies. It is imperative that a timeshare company stay well-informed of new
regulations, proposed regulations and general trends within the industry and
regulation agencies. For example, in each timeshare transaction, the borrower
has a statutory rescission period during which he or she may cancel the
transaction. This statutory waiting period varies from state to state, and we
cannot complete the loan transaction until the statutory rescission period has
lapsed. Changes to a state’s rescission period, such as an increase in the
waiting time required, could potentially harm our business by creating
additional administrative burdens.
We face risks in
regard to geographic expansion.
We intend to expand our reach throughout
the country by registering as a Mortgage Banker and completing the licensing
requirements in States where there is a preponderance of timeshare projects and
timeshare owners. We believe that this expansion will extend into new markets,
and also enhance the existing markets in which we are licensed to do business.
Our strategy involves focusing on geographic areas that we currently feel are
under-served and tailoring our loan programs to better service existing
markets.
If we lose any
member of our senior management team and are unable to find a suitable
replacement, we may not have the depth of senior management resources required
to efficiently manage our business and execute our growth strategy.
We
depend on the continued contributions of our senior management and skilled
employees. We do not maintain key person life insurance policies on any of our
officers. There is a risk that the loss of a significant number of key personnel
could have negative effects on our results of operations. We may not be able to
attract and hire highly skilled personnel to replace lost employees necessary to
carry out our business plan. There is also a risk that management may not be
able to adopt an organizational structure that meets its objectives, including
managing costs and attracting and retaining key employees.
We also
need to hire additional members of senior management to adequately manage our
growing business. We may not be able to identify and attract additional
qualified senior management. Competition for senior management in our industry
is intense. Qualified individuals are in high demand, and we may incur
significant costs to attract them. If we are unable to attract and retain
qualified senior management we may not be able to implement our business
strategy effectively and our revenue may decline. Our success will be
substantially dependent on the performance of our executive officers and key
employees. Given our early stage of development, we are dependent on our ability
to retain and motivate high quality personnel. An inability to engage qualified
personnel could materially adversely affect our ability to market our timeshare
loan services. The loss of one or more of our key employees or our inability to
hire and retain other qualified employees could have a material adverse effect
on our business. See “Management.”
Risks related to Timeshare’s
common stock and its market value:
Our
stock trades in a limited public market, the over-the-counter bulletin board;
accordingly, investors face possible volatility of share price.
Our
common stock is currently quoted on the Over-the-Counter Bulletin Board under
the ticker symbol TMSH.OB. As of the date of this prospectus, there are
approximately 30,167,000 shares of Common Stock outstanding.
There
can be no assurance that a trading market will be sustained in the future.
Factors such as, but not limited to, the economy, consumer confidence, the
housing market, falling value of the US dollar in relation to other currencies,
and market conditions for penny stocks in general could have a material effect
on the liquidity of our common stock and volatility of our stock
price.
Our stock will
likely be subject to the Penny Stock rules, which impose significant
restrictions on broker-dealers and may affect the resale of our
stock
.
A penny
stock is generally a stock that:
§
|
is
not listed on a national securities exchange or NASDAQ,
|
§
|
is
listed in the "pink sheets" or on the NASD OTC Bulletin
Board,
|
§
|
has
a price per share of less than $5.00 and
|
§
|
is
issued by a company with net tangible assets less than $5
million.
|
The penny
stock trading rules impose additional duties and responsibilities upon
broker-dealers and salespersons effecting purchase and sale transactions in
common stock and other equity securities, including:
·
|
determination
of the purchaser's investment
suitability,
|
·
|
delivery
of certain information and disclosures to the purchaser,
and
|
·
|
receipt
of a specific purchase agreement before effecting the purchase
transaction.
|
Many
broker-dealers will not effect transactions in penny stocks, except on an
unsolicited basis, in order to avoid compliance with the penny stock trading
rules. In the event our common stock becomes subject to the penny stock trading
rules,
·
|
such
rules may materially limit or restrict the ability to resell our common
stock, and
|
·
|
the
liquidity typically associated with other publicly traded equity
securities may not exist.
|
Because
of the significant restrictions on trading penny stocks, a public market may
never emerge for our securities. If this happens, you may never be able to
publicly sell your shares.
Forward-Looking
Statements
You
should carefully consider the risk factors set forth above, as well as the other
information contained in this prospectus. This prospectus contains
forward-looking statements about our expectations and plans, anticipated future
events and conditions, estimates, and financial trends, which may affect our
plan of operation, business strategy, operating results, and financial position.
These forward-looking statements can be identified by the use of words such as
"believes," "estimates," "could," "possibly," "probably," "anticipates,"
"projects," "expects," "may," or "should" or other variations or similar words.
You are cautioned that any forward-looking statements are not guarantees of
future performance and are subject to risks and uncertainties. Actual results
may differ materially from those included within the forward-looking statements
as a result of various factors. Cautionary statements in the risk factors
section and elsewhere in this prospectus identify important risks and
uncertainties affecting our future, which could cause actual results to differ
materially from the forward-looking statements made in this
prospectus.
USE
OF PROCEEDS
We will
not receive any proceeds for those shares sold by selling shareholders. We may
receive up to $1,000,000 for the sale of the 10,000,000 additional shares we are
offering.
The net
proceeds to be realized by us from this offering, after deducting $ 96,000 in
estimated expenses related to this offering is up to $904,000.
The
following table sets forth our best estimate of the use of proceeds from the
sale of the minimum and maximum amount of shares offered. Since the dollar
amounts shown in the table are estimates, actual use of proceeds may vary from
the estimates shown.
Description
|
|
Assuming
Sale of
Maximum
Offering
|
|
|
|
|
|
|
Less
Estimated Offering Expenses
|
|
|
(96,000
|
)
|
|
|
|
|
|
Use
of Net Proceeds
|
|
|
|
|
Note
Advances (Deeded Loan Funding)
|
|
|
|
|
Start-up
Expenses
|
|
|
(276,000
|
)
|
Ongoing
Operating Expenses
|
|
|
|
|
Debt
Service & Accounts Payable
|
|
|
(64,000
|
)
|
|
|
|
|
|
Working
Capital
|
|
|
(10,800
|
)
|
|
|
$
|
|
|
The
working capital reserve may be used for general corporate purposes to operate,
manage and maintain the current and proposed operations including employee
wages, professional fees, expenses and other administrative costs.
We intend
to use the proceeds from this offering for the payment of deeded loan funding,
start-up expenses, ongoing operating expenses, debt service and accumulated
accounts payable. Working capital expenses which include accounting, legal,
administrative, advertising, marketing and general office expenses will be paid
from the proceeds raised in this offering.
We expect
that we should be able to commence our business and continue operations for 18
months from the proceeds raised in this offering.
Prior to
utilizing any of the proceeds from this offering, we may invest the proceeds in
short-term, investment grade, interest-bearing securities, money market
accounts, and insured certificates of deposit and/or insured banking
accounts.
We do not
intend to use any of the proceeds from this offering to purchase key-man
insurance. We anticipate that costs associated with being a public company,
including compliance and audits of our financial statements will be paid from
working capital and revenues generated from our operations.
MARKET
FOR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
Market
Information
Our
common stock has been quoted on the OTC Bulletin Board under the symbol
“TMSH.OB” since March 11, 2008. The following table sets forth the
high and low bid prices per share of common stock since that
time. These prices represent inter-dealer quotations without retail
markup, markdown, or commission and may not necessarily represent actual
transactions.
|
|
Fiscal
2008
|
|
Quarter
Ended
|
|
High
|
|
|
Low
|
|
March
31
|
|
$
|
0.25
|
|
|
$
|
0.15
|
|
June
30 (1)
|
|
$
|
0.20
|
|
|
$
|
0.092
|
|
(1)
|
High
and Low prices reflected are up to May 27, 2008, at which time the
Company’s common stock closed at
$0.16.
|
Holders
of the Common Stock
As of the
date of this registration statement, we have 30,167,000 shares of our $0.001 par
value common stock issued and outstanding. There are approximately 105
shareholders of record that hold our common stock.
Dividends
We have
never declared nor paid any cash dividends on our common stock. For the
foreseeable future, we intend to retain any earnings to finance the operation
and expansion of our business, and we do not anticipate declaring or paying any
dividends on our common stock. Dividends are declared at the sole discretion of
our Board of Directors.
DILUTION
AND COMPARATIVE DATA
The
difference between the public offering price per share of common stock, and the
pro forma net tangible book value per share of our common stock after this
offering constitutes the dilution to investors in this offering. Net tangible
book value per share is determined by dividing our net tangible book value,
which is our total tangible assets less total liabilities (including the value
of common stock which may be converted into cash), by the number of outstanding
shares of our common stock.
As of
March 31, 2008, our net tangible book value was a deficiency of,
($523,726), or
approximately ($0.017) per share of common stock. After giving effect to the
sale of the maximum offering of 10,000,000 shares of common stock, and the
deduction of estimated expenses of this offering, our pro forma net tangible
book value at March 31, 2008, would have been $476,274 or $.016 per share,
representing an immediate increase in net tangible book value of $.033 per share
to initial stockholders and an immediate dilution of $.084 per share to new
investors.
The
following table illustrates the dilution to the new investors on a per-share
basis:
|
|
|
|
|
|
|
|
Net
Tangible book value before this
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
attributable to new investors
|
|
$
|
.033
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pro
forma net tangible book value after
|
|
|
|
|
|
$
|
.016
|
|
|
|
|
|
|
|
|
|
|
Dilution
to new investors
|
|
|
|
|
|
$
|
.084
|
|
The pro
forma net tangible book value after the offering is calculated as
follows:
Numerator:
|
|
|
|
Net
tangible book value (deficiency) before this offering
|
|
$
|
(523,726
|
)
|
Proceeds
from the offering (minimum)
|
|
|
1,0000,000
|
|
|
|
$
|
476,274
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
Shares
of common stock outstanding prior to this offering
|
|
|
30,167,000
|
|
Shares
of common stock included in the units offered(minimum)
|
|
|
10,000,000
|
|
|
|
|
40,167,000
|
|
The
following table sets forth with respect to the existing shareholders, a
comparison of the number of shares of common stock owned by the existing
shareholders, the number of common stock to be purchased from the Company by the
purchasers of the Units offered hereby and the respective aggregate
consideration paid to the Company and the average price per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assuming
Maximum Offering:
|
|
|
|
|
|
|
|
Shares
Purchase
|
|
Total
Consideration
|
|
Average
Price Per
|
|
|
Number
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
investors
|
|
|
|
10,000,000
|
|
24.9
|
|
|
|
|
1,000,000
|
|
|
|
45.1
|
|
|
|
|
.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
40,167,000
|
|
100.0
|
%
|
|
|
$
|
7,088,406
|
|
|
|
100
|
%
|
|
|
|
|
|
|
|
(1)
|
Includes
17,576,000 shares of common stock issued to officers, directors and
affiliated persons.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND
RESULTS OF OPERATIONS
The
statements contained in this prospectus are not purely historical statements,
but rather include what we believe are forward-looking statements. The
forward-looking statements are based on factors set forth in the following
discussion and in the discussions under "Risk Factors" and "Business." Our
actual results could differ materially from results anticipated in these
forward-looking statements. All forward-looking statements included in this
document are based on information available to us on the date hereof, and we
assume no obligation to update any such forward-looking statements.
Plan of
Operations
Our Plan
of Operations for the first twelve months is to introduce our lending operations
through a variety of marketing programs over a wide geographic area, while
maintaining our credit quality. By offering a diversified product line of
financing options heretofore not widely available to the consumer, and
maintaining a high level of service, the Company anticipates a level of
acceptance that will allow it to grow its portfolio of receivables on a
consistent growth pattern.
To
accomplish this strategic plan, the Company will implement its core marketing
programs, as discussed in detail in our Business Model section, which will allow
it to offer new loan products through the internet, direct mail and referral
programs, expansion of its network of correspondent real estate brokers as well
as the introduction of its programs and products to homeowners associations that
have been abandoned by project developers or been left on their own due to the
completion of the developers’ sales efforts.
Simultaneously,
the Company will expand its geographic diversity by finalizing its licensing
requirements in eighteen States throughout the Country that represent locations
accounting for approximately sixty five (65) percent of the timeshare projects,
and consumer residences that currently own vacation intervals.
To manage
this growth, the Company will need to attract qualified personnel for key
managerial as well as operational positions. During the next twelve months, the
Company will employ an additional twelve people that will be joining the Company
on a phased basis as the Company’s operations expand. Our strategic plan is to
fill one managerial and three operational positions at the onset of full scale
operations. The Company will also add two outside directors to its Board for
governance.
During
the next twelve months, the company will require funding to supplement our
anticipated revenues and fund our continuing operations. Resultantly, Company
officials will be developing additional sources of capital to fuel its loan
originations of non-deeded vacation interval product that supplement its loan
originations of deeded timeshare intervals, as well as the sale of its stock to
the public to cover operational shortfalls and start up costs.
The
following is a synopsis of management’s forecast for the first twelve months of
full operations. This forecast was built upon our good faith estimates,
conservatively cast, and assuming a successful initial public
offering:
Loans
Originated:
|
|
|
|
|
|
|
|
Mortgage
Loans Originated
|
|
|
|
|
Personal
Loans Originated
|
|
|
263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal
Loans
|
|
|
2,630,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
And
service fee income
|
|
$
|
1,519,000
|
|
|
|
|
|
|
Operational
Expenses
|
|
$
|
2,350,000
|
|
|
|
|
|
|
Loss
from Operations
|
|
$
|
831,000
|
|
Trends
in Our Industry and Business
A number
of trends in our industry and business have a significant effect on our
operations and our financial results. These trends include:
The growth of secondary market
sales.
Our market research has shown that the secondary-financing niche
is currently underserved
.
The vacation ownership
industry has continued to grow year after year and currently domestic industry
sales are estimated to be in excess of $10 Billion annually. Based on industry
data, it is estimated that 40% of vacation ownership owners wish to acquire
additional intervals or use periods. At the same time, approximately 25% of
owners will at any given time wish to sell their interval. Currently, the
American Resort Development Association (ARDA) estimates that approximately
4.4 Million US resident households own vacation ownership. Utilizing
an average secondary market price of $4,500 per interval the potential market
for secondary market sales is approximately $6 Billion and growing each year.
The primary impediment to the actual growth of secondary market sales has been a
lack of consumer financing. Despite the lack of financing the secondary market
for vacation ownership sales is approaching $2,000,000,000
annually.
The continued popularity and growth
of vacation ownership.
Over the past 10 years, vacation ownership has
been one of the fastest growing sectors of the vacation and real estate
industries. Current domestic sales levels are estimated to be about $10 billion
annually at resorts located within the United States alone. International sales
exceed $3 billion. Growth of the industry has been rapid. Current annual United
States sales volume is more than 500,000 vacation ownership weeks. Just 10 years
ago, total volume (intervals sold) was only 29,000 weeks. The total number of
vacation ownership resorts within the United States has increased during the
last 10 years from 1,000 to over 2,500 (of all sizes and status) and, during the
past decade, over one-half of all households in the country who have purchased
resort properties have purchased a vacation ownership interest.
The continued success in the travel
and tourism industries.
Vacation ownership is also an increasingly
important element in the travel industry. Besides high sales volume, vacation
ownership offers many cost and operational advantages over other forms of
vacation accommodation. According to economic impact studies conducted by Ragatz
Associates, vacation ownership resorts experience an average annual occupancy
rate of about 85% with minimal seasonal fluctuations. By comparison, the average
resort hotel experiences about 60% occupancy and, often, extreme
seasonality.
Continued confidence in the economy
and consumer spending on travel.
Depending upon location, vacation
ownership owners spend about $170 per day per visitor party in the local resort
area, primarily in eating and drinking establishments. This is 1.3 to 1.6 times
as much as the average spent by all visitor parties in the same areas. Vacation
ownership development generates (directly and indirectly) about one job per
vacation ownership unit, and produces 2.5 to 7.5 times as much local government
revenue as it consumes. These figures do not include construction, maintenance,
or travel services expenditures, which add significantly to the total economic
impact of vacation ownership. Because of the growing impact of vacation
ownership, interest in this sector by the travel industry and others is growing.
A number of major hotel chains have become involved in vacation ownership
development, and increasingly, travel products specifically intended to serve
the vacation ownership owner are being provided.
Results
of Operations
Quarter
Ended March 31, 2008 as compared to Quarter Ended March 31, 2007
Revenues
were $ 0 for the quarter ended March 31, 2008 compared to $ 0 for the quarter
ended March 31, 2007. There is no increase or decrease in
revenues.
Cost of
sales was $ 0 for the quarter ended March 31, 2008 compared to $ 0 for the
quarter ended March 31, 2007. There has been no increase or decrease in cost of
sales.
Operating
Expenses decreased 60 % to $ 61,982 for the quarter ended March 31, 2008
compared to $ 154,097 for the quarter ended March 31, 2007. This
decrease is attributable primarily to a reduction in compensation costs and
professional fees.
Interest
expenses increased 22 % to $ 8,022 for the quarter ended March 31, 2008 compared
to $ 6,599 of interest expense for the quarter ended March 31, 2007. The
increase in interest expenses is attributable to the increased debt incurred by
the Company.
Net loss
decreased 64 % to $ 57,280 for the quarter ended March 31, 2008 compared to $
160,696 for the quarter ended March 31, 2007 due to a reduction in Professional
Fees and a lack of Compensation Cost expense.
Liquidity
and Capital Resources
Our total
current assets at March 31, 2008, comprised of cash, receivable, and prepaid
expenses were $22,268. Additionally, we had shareholder (deficit) in the amount
of ($523,726) at March 31, 2008. This difference was attributable to the sum of
fixed assets, $ 15,010, and other assets, $ 9,127 less, current liabilities of $
570,131.
Our cash
on hand increased to $ 3,928 as of March 31, 2008 compared to $ 2,191 as of
December 31, 2007.
Our
receivable at March 31, 2008 was $13,284. This is attributable to late payment
of sub-tenant rent at our California office location.
As of
March 31, 2008 we had a working capital deficiency of $ 547,863. A major portion
of our debt is attributed to consulting fees, accounting fees, attorney fees,
and payroll taxes payable. We plan to reduce these debts with
proceeds generated from normal operational cash flow as well as the issuance of
company stock.
The
current portion of long-term debt at March 31, 2008 was $297,010. We expect to
pay off $ 150,000 by the end of the fiscal year. We plan to pay this with
proceeds generated from the Company's stock offering.
At March
31, 2008 we had no bank debt and Loans Payable to individual lenders of $
42,000.
Year
Ended December 31, 2007 as compared to Year Ended December 31, 2006
Revenues
remained at $0 for the year ended December 31, 2007 compared to $0 for the year
ended December 31, 2006. There has been no increase or decrease to
Revenues.
Cost of
sales remained at $0 for the year ended December 31, 2007 compared to $0 for the
year ended December 31, 2006. There has been no increase or decrease to Cost of
Sales.
Operating
Expenses decreased 93 % to $ 389,048 for the year ended December 31,
2007 compared to $ 5,960,672 for the year ended December 31,
2006. This decrease is attributable primarily to a reduction in the
level of start up costs.
Interest
expenses increased 46% to $ 27,312 for the year ended December 31, 2007 compared
to $ 18,724 of interest expense for the year ended 30, 2006. The increase in
interest expenses is attributable to increased borrowing to fund start up
expenses.
Net loss
decreased 93% to $ 402,509 for the year ended December 31, 2007
compared to $ 5,979,396 for the year ended December 31, 2006 as a direct result
of lower levels of start up costs.
Liquidity
and Capital Resources
Our total
current assets at December 31, 2007, comprised of cash, receivables, and prepaid
expenses were $12,570. Additionally, we had shareholder equity/(deficit) in the
amount of ($466,446) at December 31, 2007. This difference was attributable to
the sum of fixed assets, $15,910 and other assets of $9,127 less current
liabilities of $504,053.
Our cash
on hand increased to $ 2,191 as of December 31, 2007 compared to $
225 as of December 31, 2006.
Our
receivables at December 31, 2007 were $ 5,323. This is attributable to
sub-tenant rental revenues from our California office location.
As of
December 31, 2007 we had a working capital deficiency of $ 491,483. A
major portion of our debt is attributed to consulting fees, accounting fees,
attorney fees, and public company start up expenses. We plan to
reduce these debts with proceeds generated from normal operational cash flow as
well as the issuance of company stock.
The
current portion of long-term debt at December 31, 2007 was $ 277,060. We expect
to pay off the entire $277,060 by year-end 2009. We plan to pay this with
proceeds from private placement stock offering.
At
December 31, 2007 we had $0 bank debt.
Off
Balance Sheet Arrangements
We do not
have any off balance sheet arrangements that are reasonably likely to have
current or future effect on our financial condition, revenues, result of
operations, liquidity or capital expenditures.
Critical
Accounting Policies
Our
financial statements are prepared in accordance with accounting principles
generally accepted in the United States, which require management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements, the disclosure of
contingent assets and liabilities and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The critical accounting policies that affect our more significant
estimates and assumptions used in the preparation of our financial statements
are reviewed and any required adjustments are recorded on a monthly
basis.
DESCRIPTION
OF BUSINESS
Overview.
TimeShareLoans.com,
Inc. ("TSL") was incorporated on July 12, 2005 to provide financing for
consumers wishing to purchase and/or refinance vacation ownership intervals in
the secondary, or resale market, or elsewhere. Timeshare Holdings Inc.
(“Timeshare”) was incorporated in Nevada on January 30, 2007 with the intent of
merging with TSL. Timeshare is headquartered in Las Vegas, Nevada and also
maintains an office in Irvine, California.
On March 9,
2007 TSL and Timeshare entered into the Agreement and Plan of Reorganization,
(the “Agreement"), whereby TSL became a wholly owned subsidiary of
Timeshare. Pursuant to the Agreement 100% of the outstanding shares of
common stock of TSL (1,182,680 shares) were acquired by Timeshare in exchange
for 100% of the outstanding shares of common stock of Timeshare (29,991,000
shares).
As a result
of the transaction outlined above, the operations of the Company as a whole
going forward will be comprised of the operations of Timeshare and
TSL.
We
intend to focus on originating short-term, high-yield consumer notes. Both fee
simple and non-fee simple licensed timeshare interests collateralize the notes.
Fee simple projects are substantially similar to condominiums in which
purchasers obtain a true ownership interest in real property, with a deed, title
insurance and other indicia of real estate ownership. A declaration of
covenants, conditions and restrictions establishing the vacation ownership
regime is recorded in the local real property records; such a declaration
resembles a condominium declaration, which is also recorded among the local land
records. Purchases of intervals are completed in generally the same manner as
condominiums. Individual purchasers execute purchase agreements for intervals.
At closing, purchasers obtain deeds to their interval that are recorded among
the local land records, and the purchasers give security to their lenders in the
form of mortgages or security interests which operate as first liens against the
respective intervals. Typically the purchasers will have a real property
interests in the resort and the deeds will provide that the purchasers may or
may not give up the right to use the specific unit, but will instead abide by
the resort reservation system unless otherwise provided for by the timeshare
regime. Within a specified period of time each year, owners will have the right
to reserve their occupancy a year in the same type of unit, according to a first
come, first served system. Purchasers also have the ability to trade their
interval through a national exchange organization such as Interval International
or Resort Condominium International, based upon their resort’s
affiliation.
The timeshare non-fee simple license
product provides a recorded ownership interest in a period of time or a formula
based upon an issuance of points in a specific unit type but the underlying real
estate does not pass to the purchaser. Purchasers of non-fee simple licensed
product may accumulate their points to trade for a larger or smaller guest room
unit, or a different season at another resort that recognizes their non-fee
simple licensed timeshare product program. Timeshare interests involve a use
right in a specific type of unit (i.e. a studio, one bedroom, two bedroom, etc.)
for a specific period of time. Purchasers of timeshare non-fee simple licensed
products may grant security to their lenders in the form of personal loans or
security interest which operate as liens against their non-fee simple licensed
timeshare product.
Historically
the purchasers of vacation ownership interests or timeshare interests typically
finance 90% of the purchase price through financing offered by the resort
developer. In the secondary market there is limited financing available due to
the non-involvement of a developer entity. We intend to fill that void by
offering credit financing to qualified buyers. The resulting notes are then sold
or pledged as security with financial institutions specializing in this type of
financing. Typical rates intended to be charged by Timeshare Holdings to the
consumer will be 12.95% to 19.95% and typical rates from the institutions to
Timeshare Holdings are 8% to 12%. Historical Timeshare Industry default rates
for these notes average 4% to 5% with an average CPR of 4%. Typical terms vary
from 24 months to 120 months with the majority of vacation ownership and
Timeshare Interests being financed for a period of 84 months.
Timeshare
Holdings, Inc. through it’s subsidiary TimeShareLoans.com, Inc (“TSL”) is
currently licensed or has commenced the licensing process in states representing
sixty-five percent (65%) of the retail timeshare sales market, including
California, Hawaii, Florida, Nevada, Texas, Virginia and North Carolina. Our
licensing status is a major asset since all secondary market financing is
subject to the mortgage banking regulations of the individual
states.
Timeshare
Holdings’ loan application process will generally be conducted over the Internet
and telephone with applications intended to be received at our centralized
processing facility in Irvine, California. Upon receipt of an application, the
information will be entered into our system and processing will begin. Our
employees will analyze all loan applications individually. We have developed a
proprietary credit index profile as a statistical credit based tool to predict
likely future performance of a borrower. A significant component of this
customized system is the credit evaluation score methodology developed by the
credit reporting agencies (FICO). This component is used in creating predictive
default models. The other components that we will rely upon are income analysis,
employment stability, residence stability and debt to income analysis. By
utilizing this scoring model, all applicants will be considered on the basis of
their ability to repay the loan obligation while allowing us to maintain our
risk based pricing for each loan.
Prior to
entering into a loan transaction with a borrower, we will require the borrower
to complete a credit application. Approvals of borrower’s electronically filed
loan applications will be processed quickly upon the receipt of a completed
application by using our internet based software systems and our propriety
credit scoring matrix. Upon the receipt of the loan documentation from the
borrower, and a phone interview with a loan processor, escrow will be opened and
the loan is funded. As with all timeshare purchases, the borrower has a
statutory rescission period to cancel the purchase of their timeshare interest.
Once the rescission period has expired, the loan transaction is
completed.
It is
noteworthy that real estate brokers and homeowners associations will qualify to
participate in our programs only after a review by our management of their
individual expertise and reputations, including a review of business practices,
financial information, and consumer complaints, perhaps including a site visit
from a representative of Timeshare Holdings. It is intended to be our policy to
review, on a regular basis, the performance of each of the participants in our
broker network.
None of
our arrangements with real estate broker participants is on an exclusive basis.
It is anticipated that each relationship is documented by marketing and
remarketing agreement. The commission that the broker earns for a sales
transaction is borne by the purchaser or the seller, not by Timeshare
Holdings.
Our
Business Model
Marketing.
The unique concept
being marketed by Timeshare Holdings is twenty-four hours per day, seven days
per week Internet based, state-of-the-art application process to provide
financing for purchase and refinancing of timeshare weeks in the secondary
market. We have structured our financial model based on providing credit
facilities to individuals with FICO scores of 590 and above and providing loan
approvals to these purchasers quickly. Loans typically range from $4,000 to
$40,000.
Our
strategic plan is to introduce our lending operations while maintaining our
credit quality. Our strategies include: offering the borrower new loan products
through the internet, direct mail and referrals; expanding our network of
correspondent real estate brokers; introduction of our programs and products to
Homeowners Associations that have been abandoned by the project developers or
been left on their own due to the completion of sales by the project developers;
entering geographic markets where there is an abundance of timeshare projects
and owners; realizing operational efficiencies through economies of scale; and
utilizing securitizations to sell higher volumes of loans on terms that are more
favorable than hypothecation. By offering a diversified product line of
financing options hereto for not widely available to the consumer, and
maintaining its high level of service, we anticipate a level of acceptance that
will allow us to grow our portfolio of receivables on a consistent growth
pattern.
Expansion
of Broker Network
.
We
intend to originate loans from select real estate brokers, specializing in sales
of timeshare intervals in the secondary market. We will structure our product
line to meet the needs of this important network of brokers. We have established
relationships with many proven timeshare resale companies that are active in the
secondary market. Stroman Realty, Resort Management Company (RMC) and All Island
Timeshare are specific entities that specialize in timeshare sales in the
secondary market. We also plan to aggressively seek establishing relationships
with other brokers, large and small, that will benefit from our
programs.
To
accomplish the expansion of its broker network, we will participate in trade
shows, both regionally and nationally, where our programs will be showcased.
Additionally, Management will leverage its networking capabilities within
American Resort Development Association ("ARDA") to bring attention
and exposure of our programs to industry insiders. Finally, we will attempt to
provide face-to-face explanation, instruction and demonstration of its products
and programs directly to brokers at their place of business as part of our
comprehensive business development approach. To provide for the success of these
relationships, we will attempt to provide to its broker network ongoing support
and training.
Network
of Homeowners’ Associations.
A long-neglected, yet vitally important,
component of the timeshare industry is the Homeowners’ Association that is
created along with a timeshare project. Its purpose is to manage and
administrate a project on behalf of the owners once the developer of the project
has sold a substantial number of interests in the project, or for whatever
reason is no longer associated with or has abandoned the project. To fund its
operations, the Association has the authority to assess maintenance fees or
association assessments that cover upkeep of the project, fund reserves for
capital improvements and insurance. As a result of this authority, it may be
necessary for the Association to enforce its collection of these fees or
assessments by placing liens, or ultimately foreclosing on the timeshare
intervals owned by non-paying timeshare owners.
Upon foreclosure, the Association faces
the dilemma of carrying a non-liquid asset on its balance sheet in the form of
the foreclosed upon interval. Many of these Associations, unless supported by a
large development company such as Marriott, do not have the expertise or
wherewithal to convert this non-performing asset into cash. We recognize the
needs of these Associations as an important avenue to building our loan
portfolio by assisting them with the financing necessary to convert dormant
intervals to cash through a sales transaction.
To
accomplish this, we intend to follow a program of business development similar
to the approach used with our broker network. By showcasing our products in
periodicals geared to the consumer, attending functions and seminars directed
towards Associations and most importantly, by participating in American
Resort Development Association-Resort Owners Coalition ("ARDA -ROC"), the
arm of the American Resort Development Association that acts as the ombudsman
and advocate of individual timeshare owners and associations, we intend to
provide a lifeline for this very large and underserved segment of the industry.
The potential exists that this market could eclipse the loan originations
generated by the broker network in the opinion of management. The development of
the association network will require direct hands on education of the managers
of various associations as well as ongoing support and training.
Loan Origination Through the
Internet
.
As
consumers have become more educated regarding the timeshare concept, astute
purchasers have come to realize that the timeshare intervals may be acquired
through alternatives that allow them to bypass the traditional sales seminars
sponsored by developers. By investigating purchase options through the Internet,
in a manner similar to the way that many consumers now book travel arrangements,
they have found a means of acquiring the type of timeshare that appeals to them,
often at discounted prices, from the comfort of their homes and without the
pressure associated with a traditional timeshare presentation. Many of these
purchasers are existing timeshare owners looking to purchase additional
intervals. A strong secondary market has developed, supported by the
proliferation of web sites catering to those needs. The brokers mentioned
earlier sponsor many of these web sites, which will list intervals from willing
sellers and match those sellers with willing buyers. In most cases, transactions
between buyers and sellers are conducted on an all cash basis, or involve seller
financing, due to the lack of a comprehensive financing program that could be
taken advantage of by those on either side of the transaction.
For those
consumers doing business with the brokers that we have established relationships
with, it is intended that a link will be provided from their web site to that of
TimeShareLoans.com, Inc. (
www.timeshareloans.com
) where the consumer will be provided information regarding the type of
financing available. A credit application can also be completed. A testimonial
and recommendation will be provided to the consumer from the broker or its
representative to explore this option. By having a financing program available,
the broker benefits by being able to discuss an expanded list of product, the
seller benefits by realizing a higher price for the interval and the purchaser
benefits by being able to finance the purchase rather than having to “front” the
entire purchase price in cash. With the rapid approval process developed by
Timeshare Holdings, the number of sales being written by these brokers should
expand as well as the corresponding loan origination.
For every
consumer that chooses to work through a broker-affiliated web site, there are
consumers that will choose to follow other paths within the web to acquire their
intervals. For some, a simple Internet search identifying timeshare intervals
will lead them to those seeking to sell their intervals through chat rooms or
consumer blogs, auction sites such as Ebay, sites specializing in rental of
timeshares, or exchange companies. In those instances our strategy is to make
our products and programs known through banner ads. Others will seek intervals
through the major exchange companies, or sites such as Redweeks.com, offering
rentals as a means of attracting potential buyers. The two main exchange
companies serving the timeshare industry are Resorts Condominium International
and Interval International. We will attempt to purchase advertising space on
their web sites and will provide the exchange companies with articles for their
periodic magazines, which are mailed to each of their existing members
bases.
For those
consumers doing Internet searches for timeshare financing, we have registered
key domain names and will work with search engines to make those names the most
visible choices for those seeking that information.
To avoid
the appearance of deceptive trade practices, the Company will also publish and
provide an “opt in” electronic newsletter that will allow the company to capture
names-email addresses, and phone numbers for its database.
Loan Origination through Other Media
Outlets.
In addition to providing information to the exchange companies
for publication in their periodic magazines, we intend to provide press releases
and articles for publication in all of the trade journals associated with the
timeshare industry, such as Developments, The Trades, and Timesharing Today
amongst others. Eventually, as Timeshare Holdings grows, we will attempt to
develop a media campaign similar to the Di-Tech model or Timeshares Only model
that will run on cable television outlets in selected markets throughout the
country.
Employees.
We currently have
three (3) employees, all of which are employed on a fulltime basis. We
anticipate increasing our employee base from three employees in 2007 to an
anticipated twelve (12) employees in 2008.
DESCRIPTION
OF PROPERTY
The
Company currently leases space for its Irvine, California office, consisting of
approximately 4,624 square feet of office space, located at 16842 Von Karman
Ave, Bldg. 400, 2nd Floor, Irvine, California. Monthly lease payments
are $8,430 and the lease expires on June 30, 2010.
The
Company's administrative staff and headquarters are located in Las Vegas,
Nevada. The office space is located at 2350 S Jones Blvd, Ste. 101,
Las Vegas, Nevada, 89146. The monthly lease payment of the location is $650 per
month, for approximately 150 square feet. The term of the Office Services
Agreement is determined on a month-to-month basis. The Company
anticipates increasing square footage as needed, and rent increasing to $1250
per month in 2008, and $1500 per month by 2009.
LEGAL
PROCEEDINGS
From time
to time we may be a defendant and plaintiff in various legal proceedings arising
in the normal course of our business. We are currently not a party to any
material pending legal proceedings or government actions, including any
bankruptcy, receivership, or similar proceedings. In addition, management is not
aware of any known litigation or liabilities involving the operators of our
properties that could affect our operations. Should any liabilities incurred in
the future, they will be accrued based on management’s best estimate of the
potential loss. As such, there is no adverse effect on our consolidated
financial position, results of operations or cash flow at this time.
Furthermore, Management of the Company does not believe that there are any
proceedings to which any director, officer, or affiliate of the Company, any
owner of record of the beneficially or more than five percent of the common
stock of the Company, or any associate of any such director, officer, affiliate
of the Company, or security holder is a party adverse to the Company or has a
material interest adverse to the Company.
MANAGEMENT
DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Our
directors and executive officers will manage our business.
A list of
our current officers and directors appears below. The directors are elected
annually by the shareholders. They do not presently receive any fees or other
remuneration for their services as directors, although they are reimbursed for
expenses associated with attending meetings of the board of directors. The board
of directors appoints our officers.
Name
|
|
Age
|
|
Position
|
|
|
|
|
|
|
|
|
|
Chief
Executive Officer and Chairman of the Board
|
|
|
|
|
|
|
|
|
|
President,
Chief Financial Officer, Director
|
|
|
|
|
|
|
|
|
|
Secretary,
Vice President, Director of Loan Administration
|
|
|
|
|
|
Paul Kenneth
Thompson
has served as a Director and as the Chief Executive Officer and
President of TimeShareLoans.com, Inc. since July 22, 2005. Mr. Thompson is also
the founder of Timeshare Holdings and has served as a Director and Chief
Executive Officer since its inception in January 2007. Mr. Thompson holds his
Real Estate Broker License in the State of California and is a licensed loan
officer in the State of North Carolina and Virginia. Since 1997,
Mr. Thompson is founder and has served as President of National Mortgage
Lending, Inc. or NMLI, a residential mortgage lender doing business in 40
states. In 1996 he served as a principle for a SEC Investment company, Catalina
Capital Management, Inc. Mr. Thompson has spent the last twenty years in
founder, executive and broker positions. Mr. Thompson attended UCLA, has been a
member of American Resort Development Association (ARDA) since 1999, and served
on the ARDA Finance Committee for 7 years.
Frederick Henry
Conte
has served as Treasurer, Chief Financial Officer and Director of
TimeShareLoans.com, Inc. since 2005. Mr. Conte has also served as a founder,
President and Chief Financial Officer of Timeshare Holdings’ and a director
since its inception in January 2007. Prior to joining Timeshare Holdings,
Mr. Conte served in various executive leadership positions with several
land development timeshare and resort companies. Mr. Conte is the founder of
FAVA Enterprises, LLC, a real estate consulting firm. Mr. Conte received
his Bachelor’s Degree from Syracuse University, and has earned the
designation of Registered Resort Professional (RRP) by the American Resort
Development Association (ARDA), sat on several ARDA committees and was member of
the ARDA Board of Directors for many years.
Lynn
Denton
has served as the Secretary and a Director of TimeShareLoans.com,
Inc. since October 2005. Ms. Denton also has served as Timeshare Holdings’
founder, Secretary and Director since its inception in January 2007. For
twenty-three years prior to joining Timeshare Holdings, Inc., Ms. Denton served
in various management and loan administration positions at Cendant Timeshare
Resort Group. As Director for Cendant Timeshare Resort Group she established an
in-house collection operation to support Property Owner Associations with
collection of defaulted annual Maintenance Fees. She grew the business by over
200% in the first 4 years. Ms. Denton developed and implemented the Cendant
Timeshare Resort Groups’ business plan to service and collect on their portfolio
of over $1,5MM in open receivables within acceptable currency standards. Ms.
Denton attended the University of Central Arkansas, and has successfully passed
the requirement of the American Resort Development Association’s (ARDA) AIF
Qualification (ARDA International Foundation) test demonstrating her commitment
to quality, industry knowledge, integrity and pledge to adhere to ARDA’s Code of
Standards and Ethics.
Executive
Officers
Our
executive officers are appointed by and serve at the discretion of our board of
directors.
Board
of Directors
Our board
of directors currently consists of three directors. We plan to appoint
additional independent directors.
Our
Bylaws provide that the number of persons constituting our board of directors
may be fixed from time to time, but only by a resolution adopted by a majority
of our board of directors. Vacancies on the board of directors and newly created
directorships resulting from any increase in the authorized number of directors
will be filled by a majority vote of the directors then in office, even if less
than a quorum, or by the sole remaining director, until his successor is duly
elected.
Code
of Ethics
We have
recently adopted a Code of Ethics and Business Conduct authorizing the
establishment of a committee to ensure that our disclosure controls and
procedures remain effective. Our Code also defines the standard of conduct
expected by our officers, directors and employees. The Code is filed as Exhibit
14.1 to this report.
EXECUTIVE
COMPENSATION
The
following tables set forth certain information regarding our Chief Executive
Officer and each of our most highly-compensated executive officers whose total
annual salary and bonus for the fiscal years ending December 31, 2007, and 2006,
exceeded $100,000:
Summary
Compensation Table
Name
and Principal Position
|
|
Year
|
|
Salary
|
|
Bonus
|
|
Option
Awards
|
|
Non-Equity
Incentive Plan Compensation
|
|
Change
in Pension Value and Non-Qualified Deferred Compensation Earnings
($)
|
|
All
other Compensation
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief
Executive Officer
|
|
|
2006
|
|
$10,716
|
|
|
- -
|
|
- -
|
|
|
-0-
|
|
-0-
|
|
|
-0-
|
|
$10,716
|
Director
Compensation
None of
the directors received any compensation for their respective services rendered
to the Company as directors during the year ended December 31,
2007.
Employment
Agreements
There are
currently no Employment Agreements with executive officer or directors of
Timeshare Holdings, Inc. We hope, however, to enter into Employment Agreements
with these employees as soon as possible.
Employee
Benefit Plans
The
Company intends to offer a comprehensive employee benefits plan in the future
including but not limited to medical insurance, vacation accruals, and 401(k)
plan.
Stock
Option Plan
Currently,
the Company does not have a stock incentive plan. The Company intends, however,
to adopt a Stock Incentive Plan (the “Plan”) designed to retain directors,
executives and selected employees and consultants and reward them for making
major contributions to the success of the Company. Upon adoption of the Plan by
the Board of Directors, the Company will submit the Plan to the Shareholders for
their approval.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
LEA
Management Group, LLC. and our Company
In
December 2006, LEA Management Group, LLC, or LEA, and the Company entered into
an Agreement for Services. Pursuant to the Agreement for Services, LEA agreed to
restructure TimeShareLoans.com, Inc. through the creation of a holding company,
TimeShare Holdings, Inc. and facilitate the business combination described
elsewhere in this Form SB-2. As payment for the services rendered by LEA,
TimeShareLoans.com, Inc. agreed to pay LEA according to the following timeline
and amount:
·
|
Fifteen
percent of TimeShare Holdings, Inc.’s common stock (4,500,000 shares) are
to be placed in escrow and a portion of those shares are to be released to
LEA upon acceptance of TimeShare Holdings, Inc. as an OTCBB listed company
by the NASDAQ. Twenty-five percent of the shares shall remain in escrow
for eighteen months;
|
·
|
$100,000
due in three equal payments before the Company is accepted as a public
company with the SEC; of which two payments of $33,333 each have already
been made to LEA Management Group.
|
·
|
Thirteen
percent of TimeShare Holdings, Inc’s common stock (3,900,000 shares) are
to be placed in escrow and a portion of these shares are to be delivered
to The Research Evaluation Center upon acceptance of TimeShare Holdings,
Inc. as an OTCBB listed company by NASDAQ. Twenty-five percent of the
shares shall remain in escrow for eighteen months or until released by
Timeshare Holdings Inc.; and
|
·
|
Twelve
percent of TimeShare Holdings, Inc’s common stock (3,600,000 shares) are
to be placed in escrow and delivered to a mutually acceptable PR/IR firm
upon acceptance of TimeShare Holdings, Inc. as an OTCBB listed company by
NASDAQ, as required to fund PR/IR activities. These shares are to be
registered in this Form SB-2.
|
Debt
associated with major shareholders
The
Company has issued Promissory Notes to corporate officers, directors and
investors who are shareholders of the company. The Notes are
unsecured, bare interest at rates of 7%-12% per annum and are due on demand.
Accrued interest as of March 31, 2008 was $46,527.
The
Company’s CEO, funded the Company with a Promissory Note for $7,500, at an
interest rate of 12% in 2005, and also funded the Company with Promissory Notes
for $45,190, at an interest rate of 10% and $40,493, at an interest rate of 12%
in 2006. The Company’s CEO funded the Company with Promissory Notes
totaling $ 30,898 at an interest rate of 12% in the twelve month period ended
December 31, 2007. The Company has repaid a portion of these notes in the amount
of $43,193 during the twelve month period ended December 31, 2007. All notes are
unsecured and due on demand. Accrued interest for the quarter ended March 31,
2008 was $2,239. Total accrued interest through March 31, 2008 was $14,754. The
Company’s CEO indirectly owns 10,311,000 shares, 34.1% of the total issued and
outstanding shares, through a family trust.
The
Company’s President and Treasurer, funded the Company with a Promissory Note of
$7,000, at an interest rate of 10% in 2005, funded the Company with Promissory
Notes of $151,064, at an interest rate of 12% in 2006, and also $8,108 at an
interest rate of 12% in the twelve month period ended December 31, 2007. All
notes are unsecured and due on demand. During the three month period ended March
31, 2008 the President and Treasurer funded the Company with $7,950 at an
interest rate of 12%. Accrued interest for the three month period
ended March 31, 2008 was $4,738. Total accrued interest through March
31, 2008 was $30,042. The Company’s President and Treasurer
indirectly owns 6,514,000 shares, 21.5% of the total issued and outstanding
shares, through a family trust.
In the
period ending December 31, 2007 the company issued Promissory Notes in the
amount of $30,000 to investors that are also shareholders of Timeshare Holdings,
Inc. These Promissory Notes bear interest at a rate of 9.5% per
annum, are unsecured, and are due upon demand. During the three month period
ended March 31, 2008 the Company issued Promissory Notes in the amount of
$12,000. These Promissory Notes bear interest at rates of 7% and 7.5%
rates, are unsecured and due on demand. The accrued interest for the
three month period ended March 31, 2008 was $776. Total accrued
interest as of March 31, 2008 was $1,731.
The
Company used the proceeds of these loans for operating expenses.
SECURITY
OWNERSHIP OF DIRECTORS AND OFFICERS
AND
CERTAIN BENEFICIAL OWNERS
The
following table sets forth certain information regarding the beneficial
ownership of our common stock as of March 31, 2008, by (i) each director,
(ii) each executive officer, (iii) all directors and executive
officers as a group, and (iv) each person who beneficially owns more than
five percent of our common stock. Beneficial ownership is determined in
accordance with the rules of the SEC. The percentage ownership of each
beneficial owner is based on 30,167,000 outstanding shares of common stock.
Except as indicated, each person listed below has sole voting and investment
power with respect to the shares set forth opposite such person’s
name.
|
|
Number
of Shares
|
|
|
|
|
Name
and Title of Beneficial Owner
|
|
Beneficially
Owned(1)
|
|
|
Percentage
Ownership
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief
Executive Officer, and Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief
Financial Officer, President and Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Secretary
and VP, Director of Loan Admin.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Directors
and executive officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Unless
otherwise indicated and subject to applicable community property laws, to
our knowledge each stockholder named in the table possesses sole voting
and investment power with respect to all shares of common stock, except
for those owned jointly with that person’s spouse.
|
(2)
|
Includes
10,331,000 shares indirectly owned by Mr. Thompson through the Thompson
Family Trust.
|
(3)
|
Includes
6,514,000 shares indirectly owned by Mr. Conte through the Frederick H.
Conte and Bernadette R. Conte Family
Trust.
|
DESCRIPTION
OF SECURITIES
Common
Stock
We are
authorized to issue up to 300,000,000 shares of common stock with a par value of
$0.001 per share. As of the date of this prospectus, there are 30,167,000 shares
of common stock issued and outstanding.
The
holders of common stock are entitled to one vote per share on each matter
submitted to a vote of stockholders. In the event of liquidation, holders of
common stock are entitled to share ratably in the distribution of assets
remaining after payment of liabilities, if any. Holders of common stock have no
cumulative voting rights, and, accordingly, the holders of a majority of the
outstanding shares have the ability to elect all of the directors. Holders of
common stock have no preemptive, conversion or other rights to subscribe for
shares. There are no redemption or sinking fund provisions applicable to the
common stock. Holders of common stock are entitled to such dividends as may be
declared by the board of directors out of funds legally available therefor. The
outstanding common stock is, and the common stock to be outstanding upon
completion of this offering will be, validly issued, fully paid and
non-assessable.
We
anticipate that we will retain all of our future earnings, if any, for use in
the operation and expansion of our business. We do not anticipate paying any
cash dividends on our common stock in the foreseeable future.
Transfer
Agent
The
Company’s transfer agent and registrar is OTC Stock Transfer, 231 E 2100 South,
Salt Lake City, UT 84165.
SELLING
SECURITY HOLDERS
We are
registering 20,383,374 shared in this offering. We will not receive any of the
proceeds from the sale of those shares being sold by the selling security
holders. 10,383,374 of these shares have already been issued to the selling
security holders in private placement transactions which were exempt from the
registration and prospectus delivery requirements of the Securities Act of 1933.
An additional 10,000,000 new shares are being offered by Timeshare Holdings,
Inc. The selling security holders may sell their shares in sales in the open
market or in privately negotiated transactions. We will receive proceeds of up
to $1,000,000 from the sale of the 10,000,000 shares being offered by Timeshare
Holdings, Inc.
All
costs, expenses and fees in connection with the registration of the selling
stockholders' shares will be borne by us. All brokerage commissions, if any,
attributable to the sale of shares by selling stockholders will be borne by
selling stockholders.
The
following table sets forth the number of shares that the selling security
holders may offer for sale from time to time. The shares offered for sale
constitute all of the shares known to us to be beneficially owned by the selling
security holders. None of the selling security holders has held any position or
office with us, except as specified in the following table. Other than the
relationships described below, none of the selling security holders had or have
any material relationship with us.
|
|
Shares
of Common Stock Owned
|
|
|
Percentage
of Ownership
|
|
|
Number
of Shares Being
|
|
|
Shares
of Common Stock Owned
|
|
|
Percentage
of Ownership
|
|
Name
|
|
Prior
to the Offering
|
|
|
Before
the Offering
|
|
|
Offered
|
|
|
After
the Offering
|
|
|
After
the Offering
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Andrews,
Jerome
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barton,
Patricia
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brinegar,
Aubrey
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brundage,
Richard
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brundage,
Daniel
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brundage,
James
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casamento,
Laura
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conte,
John Marcia
|
|
|
21,000
|
|
|
|
*
|
|
|
|
21,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cook,
Donald
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denton,
Aleatha Lynn (1)
|
|
|
751,000
|
|
|
|
2.5
|
%
|
|
|
1,000
|
|
|
|
750,000
|
|
|
|
1.90
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denton,
Natalie
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastland,
Justin
|
|
|
575,000
|
|
|
|
1.9
|
%
|
|
|
431,250
|
|
|
|
143,750
|
|
|
|
*
|
|
EDLA
Family Ltd. Partnership (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Erickson,
Rae
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fisher,
Wm/Teresa
|
|
|
1,280,832
|
|
|
|
4.2
|
%
|
|
|
960,624
|
|
|
|
320,208
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Floating
Feather Holdings, Inc. (4)
|
|
|
1,280,834
|
|
|
|
4.2
|
%
|
|
|
960,625
|
|
|
|
320,209
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goldstein,
Jerome
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
Great
American Family Parks (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Griffith,
Bonnie
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Guerra,
Michael
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hidalgo,
David
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hidalgo,
Trista
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hull,
Alan
|
|
|
150,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
149,000
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hull,
Bryant
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hull,
Jason
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hull,
Ashley
|
|
|
112,500
|
|
|
|
*
|
|
|
|
112,500
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jacobs,
Don
|
|
|
12,500
|
|
|
|
*
|
|
|
|
2,500
|
|
|
|
10,000
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kessler,
Paige
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latitude,
Inc.
|
|
|
1,650,000
|
|
|
|
5.5
|
%
|
|
|
1,650,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LEA
Management Group (6)
|
|
|
100,000
|
|
|
|
*
|
|
|
|
100,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
McCallion,
Charles
|
|
|
75,000
|
|
|
|
*
|
|
|
|
75,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
McDaniel,
Ronald
|
|
|
1,280,834
|
|
|
|
4.2
|
%
|
|
|
960,625
|
|
|
|
320,209
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mosley,
Steven
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Murray,
Madie
|
|
|
12,500
|
|
|
|
*
|
|
|
|
2,500
|
|
|
|
10,000
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pico,
Tristan
|
|
|
575,000
|
|
|
|
1.9
|
%
|
|
|
431,250
|
|
|
|
143,750
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rens,
Douglas
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skorka,
Mark
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Smith,
James
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
Tag Group, Inc. (10)
|
|
|
25,000
|
|
|
|
*
|
|
|
|
25,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Van
Hooser, James
|
|
|
101,000
|
|
|
|
*
|
|
|
|
101,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yach,
Richard/Teresa
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
|
|
|
13,356,250
|
|
|
|
|
|
|
|
10,383,374
|
|
|
|
|
|
|
|
|
|
* Less
than 1%
(1)
|
Executive
officer and/or director
|
(2)
|
Underage
child of Executive office and/or director
|
(3)
|
Christopher
Eastland in his capacity as the managing director of EDLA Family Ltd.
Partnership has the voting and investment power over the shares listed.
The selling stockholder has advised us that it is not a broker-dealer or
affiliate of a broker-dealer and that it believes it is not required to be
a broker-dealer.
|
(4)
|
Larry
Eastland in his capacity as the managing director of Floating Feather
Holdings, Inc has the voting and investment power over the shares listed.
The selling stockholder has advised us that it is not a broker-dealer or
affiliate of a broker-dealer and that it believes it is not required to be
a broker-dealer.
|
(5)
|
Larry
Eastland in his capacity as the managing director of Great American Family
Parks has the voting and investment power over the shares listed. The
selling stockholder has advised us that it is not a broker-dealer or
affiliate of a broker-dealer and that it believes it is not required to be
a broker-dealer.
|
(6)
|
Justin
Eastland in his capacity as the managing director of LEA Management Group
has the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
(7)
|
Kerry
Kennedy in his capacity as the managing director of Olde Monarch Media has
the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
(8)
|
Ashley
Eastland in her capacity as the managing director of ProPublic Media .,
has the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
(9)
|
Justin
Eastland in his capacity as the managing director of Hannibal Corporation
, has the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
(10)
|
Gary
Tadych in his capacity as the managing director of The Tag Group, Inc. has
the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
(11)
|
Gary
Tadych in his capacity as the managing director of The Tag Group, Inc. has
the voting and investment power over the shares listed. The selling
stockholder has advised us that it is not a broker-dealer or affiliate of
a broker-dealer and that it believes it is not required to be a
broker-dealer.
|
PLAN
OF DISTRIBUTION
This
prospectus relates to a total of 20,383,374 shares of common stock of Timeshare
Holdings, Inc., a Nevada corporation.
An
aggregate of up to 10,383,374 shares of our common stock may be offered and sold
pursuant to this Prospectus by the selling stockholders (“Selling Stockholder”).
The Selling Stockholders acquired these shares from us in a series of private
placements conducted between January 2007 and March 2007. We will not receive
any of the proceeds resulting from the sale of the shares held by the selling
security holders.
The
Selling Stockholders and any of their pledgees, donees, transferees, assignees
and successors-in-interest may, from time to time, sell our common stock in the
over-the-counter market; on any securities exchange on which our common stock is
or becomes listed or traded; in negotiated transactions; or otherwise. The
selling security holders may sell our common stock at market prices prevailing
at the time of sale, or at prices related to the market price, or at other
negotiated prices. The shares will not be sold in an underwritten public
offering.
The
10,383,374 shares may be sold directly or through brokers or dealers. Each of
the selling security holders and any broker-dealers participating in their sales
of our stock may be deemed underwriters within the meaning of Section 2(11) of
the Securities Act of 1933. Any profit on the sale of shares by the selling
security holders and any commissions or discounts given to participating
broker-dealers may be deemed underwriting commissions or discounts. Underwriters
must comply with time and volume restrictions on sales of stock under Rule 144
of the Securities Act of 1933. Rule 144 restricts sales by underwriters,
brokers, dealers and affiliates of the registrant. Subject to Rule 144, any
selling security holders who are deemed underwriters would be prevented from
selling their shares for a period of one year after the shares were paid for and
would not be able to sell more that 10% of the total outstanding shares during
any ninety day period. These regulations could impact the ability of the
shareholders to sell their shares.
We are
also offering a maximum of 10,000,000 new shares of common stock on a best
efforts basis, at a price of $0.10 per share. The 10,000,000 new shares are
being offered for a period of 180 days from the date of this prospectus, subject
to an extension of up to an additional 90-day period
.
There is no commitment on the
part of any person to purchase and pay for any shares. Our officers, directors
and/or employees will be offering the shares for sale, but they will receive no
compensation for their efforts in making any such offers or sales. Our officers,
directors and employees may only make sales if they can rely on the exemption
provided by Rule 3a4-1 under the Securities Exchange Act of 1934, which permits
such persons to sell securities under certain circumstances without registration
as a securities broker.
We may
also engage registered broker-dealers to offer and sell the shares. We may pay
any such registered persons who make such sales a commission of up to 10% of the
sale price of shares sold, and provide the registered persons a non-accountable
expense allowance of up to 3% of the sale price of shares sold. We have not
entered into any underwriting agreement, arrangement or understanding for the
sale of the units being offered. In the event we retain a broker who may be
deemed an underwriter, we will file a post-effective amendment to this
registration statement with the Securities and Exchange Commission. This
offering is intended to be made solely by the delivery of this Prospectus and
the accompanying subscription application to prospective investors. We may
terminate this offering prior to the expiration date.
In order
to buy our shares, you must complete and execute the subscription agreement and
make payment of the purchase price for each share purchased either in cash,
check or wire transfer payable to Timeshare Holdings, Inc.
Our
officers and directors may purchase additional shares, however we do not have
any such arrangement with our officers and directors.
Solicitation
for purchase of our shares will be made only by means of this prospectus and
communications with officers and directors who:
(i)
|
will
not receive any commission in connection with the sale of any securities
registered in this offering;
|
(ii)
|
are
not and have not been associated persons of a broker dealer within the
preceding 12 months;
|
(iii)
|
do
not participate in selling an offering of securities for any issuer more
than once every 12 months;
|
(iv)
|
have
not been subject to any statutory disqualification as defined in section
3(a)(39) of the Securities Exchange Act; and
|
(v)
|
intend
to primarily perform, at the end of this offering, substantial duties on
behalf of the issuer otherwise than in connection with transactions in
securities.
|
As a
result, our officers and directors will not register as a broker-dealer with the
Securities and Exchange Commission pursuant to Section 15 of the Securities Act
in reliance of Rule 3a4-1 of the Exchange Act which sets forth the above
mentioned conditions under which a person associated with an issuer may
participate in the offering of the issuer’s securities and not be deemed a
broker-dealer.
We have
the right to accept or reject subscriptions in whole or in part, for any reason
or for no reason. All monies from rejected subscriptions will be returned
immediately by us to the subscriber, without interest or deductions.
Subscriptions for securities will be accepted or rejected within 48 hours after
we receive them.
Penny
Stock Regulation
Our
common stock is subject to Securities and Exchange Commission rules regulating
broker-dealer transactions in penny stocks. Penny stocks are generally equity
securities with a price of less than $5.00, other than securities registered on
certain national securities exchanges or quoted on the NASDAQ system, provided
that current price and volume information with respect to transactions in those
securities is provided by the exchange or system. The penny stock rules require
a broker-dealer, before a transaction in a penny stock, to deliver a
standardized risk disclosure document prepared by the Securities and Exchange
Commission, which contains the following:
·
|
a
description of the nature and level of risk in the market for penny stocks
in both public offerings and secondary
trading;
|
·
|
a
description of the broker's or dealer's duties to the customer and of the
customer’s rights and remedies with respect to violation of such
duties;
|
·
|
a
brief, clear, narrative description of a dealer market, including bid and
ask prices for penny stocks and the significance of the spread between the
bid and ask price;
|
·
|
a
toll-free telephone number for inquiries on disciplinary
actions;
|
·
|
definitions
of significant terms in the disclosure document or in the conduct of
trading in penny stocks; and
|
·
|
such
other information in such form—including language, type, size and
format—as the Securities and Exchange Commission shall require by rule or
regulation.
|
Before
effecting any transaction in a penny stock, the broker-dealer must also provide
the customer the following:
·
|
the
bid and ask quotations for the penny
stock;
|
·
|
the
compensation of the broker-dealer and its salesperson in the
transaction;
|
·
|
the
number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market
for such stock; 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 before a transaction in a penny
stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading
activity in the secondary market for a stock that becomes subject to the penny
stock rules. Holders of shares of our common stock may have difficulty selling
those shares because our common stock will probably be subject to the penny
stock rules.
Limitation
of Liability and Indemnification of Officers and Directors;
Insurance
Our
Articles of Incorporation limit the liability of directors to the maximum extent
permitted by Nevada law. Nevada law provides that directors of a corporation
will not be personally liable for monetary damages for breach of their fiduciary
duties as directors, except liability for:
|
•
|
any
breach of their duty of loyalty to the corporation or its
shareholders;
|
|
•
|
acts
or omissions not in good faith or which involve intentional misconduct or
a knowing violation of law;
|
|
•
|
unlawful
payments of dividends or unlawful stock repurchases or redemptions;
or
|
|
•
|
any
transaction from which the director derived an improper personal
benefit.
|
Our
Bylaws provide that we will indemnify our directors, officers, employees and
other agents to the fullest extent permitted by law. We believe that
indemnification under our Bylaws covers at least negligence and gross negligence
on the part of indemnified parties. Our Bylaws also permit us to secure
insurance on behalf of any officer, director, employee or other agent for any
liability arising out of his or her actions in connection with their services to
us, regardless of whether our Bylaws permit such indemnification.
There is
no pending litigation or proceeding involving any of our directors or officers
as to which indemnification is required or permitted, and we are not aware of
any threatened litigation or proceeding that may result in a claim for
indemnification.
Insofar
as an indemnification for liabilities arising under the Securities Act, may be
permitted for directors, officers or persons controlling us pursuant to the
foregoing provisions, we have been informed that in the opinion of the
Securities and Exchange Commission each indemnification is against public policy
as expressed in the Securities Act and is therefore unenforceable.
DISCLOSURE
OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
Our
articles of incorporation provide that no director or officer shall be
personally liable for damages for breach of fiduciary duty for any act or
omission unless such acts or omissions involve intentional misconduct, fraud,
knowing violation of law, or payment of dividends in violation of Section 78.300
of the Nevada Revised Statutes.
Our
bylaws provide that we shall indemnify any and all of our present or former
directors and officers, or any person who may have served at our request as
director or officer of another corporation in which we own stock or of which we
are a creditor, for expenses actually and necessarily incurred in connection
with the defense of any action, except where such officer or director is
adjudged to be liable for negligence or misconduct in performance of duty. To
the extent that a director has been successful in defense of any proceeding, the
Nevada Revised Statutes provide that he shall be indemnified against reasonable
expenses incurred in connection therewith.
To the
extent that indemnification may be available to our directors and officers for
liabilities arising under the Securities Act of 1933, we have been advised that,
in the opinion of the Securities and Exchange Commission, such indemnification
is against public policy and therefore unenforceable. If a claim for
indemnification against such liabilities—other than our paying expenses incurred
by one of our directors or officers in the successful defense of any action,
suit or proceeding—is asserted by one of our directors or officers in connection
with the securities being registered in this offering, we will, unless in the
opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
indemnification by us is against public policy as expressed in the Act, and we
will be governed by the final adjudication of such issue.
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
None.
LEGAL
MATTERS
The
validity of the common stock offered hereby will be passed upon for Timeshare
Holdings, Inc. by Sichenzia Ross Friedman Ference LLP, 61 Broadway New York, New
York 10006.
EXPERTS
The
financial statements as of December 31, 2007 and 2006 for TimeShareLoans.com,
Inc. included in this prospectus and elsewhere in the registration statement
have been audited by Chisholm, Bierwolf & Nilson, LLC, an independent
registered public accounting firm, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in auditing and accounting in giving said reports.
ADDITIONAL
INFORMATION
We have
filed with the Securities and Exchange Commission a registration statement on
Form SB-2, which includes exhibits, schedules and amendments, under the
Securities Act, with respect to this offering of our securities. Although this
prospectus, which forms a part of the registration statement, contains all
material information included in the registration statement, parts of the
registration statement have been omitted as permitted by rules and regulations
of the Securities and Exchange Commission. We refer you to the registration
statement and its exhibits for further information about us, our securities and
this offering. The registration statement and its exhibits, as well as our other
reports, including annual, quarterly, and current reports, filed with the
Securities and Exchange Commission, can be inspected and copied at the
Securities and Exchange Commission’s public reference room at 100 F Street,
N.E., Washington, D.C. 20549-1004. The public may obtain information about the
operation of the public reference room by calling the Securities and Exchange
Commission at 1-800-SEC-0330. In addition, the Securities and Exchange
Commission maintains a web site at http://www.sec.gov, which contains the Form
SB-2 and other reports, proxy and information statements and information
regarding issuers that file electronically with the Securities and Exchange
Commission.
TIMESHARE
HOLDINGS, INC.
INDEX
TO FINANCIAL STATEMENTS
For the fiscal year ended
December 31, 2007 and 2006
Report
of Independent Registered Public Accounting Firm
|
F-2
|
|
|
Balance
Sheet
|
F-3
|
|
|
Statements
of Operations
|
F-4
|
|
|
Statements
of Stockholder Equity
|
F-5
|
|
|
Statements
of Cash Flows
|
F-6
|
|
|
|
|
Notes
to Financial Statements
|
F-7
– F-16
|
|
|
|
|
For
the first quarter ended March 31, 2008 and 2007
|
|
|
|
Balance
Sheet
|
F-17
|
|
|
Statements
of Stockholders’ Deficit
|
F-18
|
|
|
Statements
of Cash Flows
|
F-20
|
|
|
Notes
to Financial Statements
|
F-21
– F-24
|
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
Board of
Directors and Stockholders
Timeshare
Holdings, Inc.
Las
Vegas, Nevada
We have
audited the accompanying balance sheet of
Timeshare Holdings, Inc.
(a
development stage company) as of December 31, 2007 and the related statements of
operations, stockholders' equity and cash flows for the periods ended December
31, 2007 and 2006, and for the period July 12, 2005 (inception) through December
31, 2007. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We
conducted our audits in accordance with standards of the PCAOB (United States).
Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. The Company has determined that it is not required to have, nor
were we engaged to perform, an audit of its internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company's internal control over financial reporting.
Accordingly, we express no such opinion. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Timeshare Holdings, Inc. as of
December 31, 2007 and the results of its operations and cash flows for the years
ended December 31, 2007 and 2006, and for the period July 12, 2005 (inception)
through December 31, 2007 in conformity with accounting principles generally
accepted in the United States.
The
accompanying financial statements have been prepared assuming that Timeshare
Holdings, Inc. will continue as a going concern. As discussed in Note 2 to the
financial statements, Timeshare Holdings, Inc. has suffered recurring losses,
negative cash flows from operations, and has working capital deficiencies during
the periods presented which raises substantial doubt about the company's ability
to continue as a going concern. Management's plans in regard to these matters
are also described in Note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/Chisolm, Bierworld &
Nilson LLC
Chisholm,
Bierwolf & Nilson LLC
Bountiful,
Utah
April 11,
2008
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Balance Sheet
ASSETS
|
|
|
|
|
|
December
31,
|
|
|
|
2007
|
|
|
|
|
|
Current
Assets
|
|
|
|
Cash
|
|
$
|
2,191
|
|
Receivable
|
|
|
5,323
|
|
Prepaid
Expense
|
|
|
5,056
|
|
|
|
|
|
|
Total
Current Assets
|
|
|
12,570
|
|
|
|
|
|
|
Fixed
Assets
|
|
|
|
|
Furniture,
Fixture & Equipment (Net)
|
|
|
15,910
|
|
|
|
|
|
|
Total
Fixed Assets
|
|
|
15,910
|
|
|
|
|
|
|
Other Assets
|
|
|
|
|
Deposit
|
|
|
9,127
|
|
|
|
|
|
|
Total
Other Assets
|
|
|
9,127
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
37,607
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
(DEFICIT)
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
Payable
|
|
$
|
136,843
|
|
Accrued
Interest
|
|
|
38,774
|
|
Accrued
Expenses
|
|
|
51,376
|
|
Note
Payable- Related Party
|
|
|
277,060
|
|
|
|
|
|
|
Total
Current Liabilities
|
|
|
504,053
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
504,053
|
|
|
|
|
|
|
Commitments
|
|
|
-
|
|
|
|
|
|
|
Stockholders'
(Deficit)
|
|
|
|
|
Common
stock – December 31, 2007: 300,000,000 Shares Authorized
|
|
|
|
|
at
$0.001 Par Value; 30,167,000 Issued and Outstanding;
|
|
|
30,167
|
|
|
|
|
|
|
Additional
Paid-In-Capital
|
|
|
6,068,239
|
|
Deficit
accumulated during the Development Stage
|
|
|
(6,564,852
|
)
|
|
|
|
|
|
Total
Stockholders' (Deficit)
|
|
|
(466,446
|
)
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
|
|
$
|
37,607
|
|
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Statements
of Operations
|
|
|
|
|
|
|
|
Accumulated
from
|
|
|
|
|
|
|
|
|
|
July
12, 2005
|
|
|
|
|
|
|
|
|
|
(inception)
through
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
|
Revenues,
Net
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries
|
|
|
49,289
|
|
|
|
76,336
|
|
|
|
184,533
|
|
Compensation
Cost
|
|
|
90,059
|
|
|
|
5,542,247
|
|
|
|
5,632,306
|
|
Professional
Fees
|
|
|
125,655
|
|
|
|
190,887
|
|
|
|
316,542
|
|
General
& Administrative
|
|
|
124,045
|
|
|
|
151,202
|
|
|
|
399,286
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Operating Expenses
|
|
|
389,048
|
|
|
|
5,960,672
|
|
|
|
6,532,667
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
From Operations
|
|
|
(389,048
|
)
|
|
|
(5,960,672
|
)
|
|
|
(6,532,667
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Income (Expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Income
|
|
|
13,851
|
|
|
|
0
|
|
|
|
13,851
|
|
Interest
Expense
|
|
|
(27,312
|
)
|
|
|
(18,724
|
)
|
|
|
(46,036
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Other Income (Expense)
|
|
|
(13,461
|
)
|
|
|
(18,724
|
)
|
|
|
(32,185
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
Before Income Taxes
|
|
|
(402,509
|
)
|
|
|
(5,979,396
|
)
|
|
|
(6,564,852
|
)
|
Income
Tax Expense
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Loss
|
|
$
|
(402,509
|
)
|
|
$
|
(5,979,396
|
)
|
|
$
|
(6,564,852
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and fully diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
per share
|
|
$
|
(0.01
|
)
|
|
$
|
(0.24
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding
|
|
|
30,112,526
|
|
|
|
24,962,066
|
|
|
|
|
|
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Statements
of Stockholders Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
Common
Stock
|
|
|
|
|
|
Accumulated
|
|
|
Stockholders'
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Paid
in Capital
|
|
|
Deficit
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
July 12, 2005
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for Founders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.01
|
|
per
share
|
|
|
21,563,483
|
|
|
|
21,564
|
|
|
|
(13,064
|
)
|
|
|
|
|
|
|
8,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.79
|
|
per
share
|
|
|
253,688
|
|
|
|
254
|
|
|
|
199,746
|
|
|
|
|
|
|
|
200,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
for the period ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(182,947
|
)
|
|
|
(182,947
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2005
|
|
|
21,817,171
|
|
|
|
21,818
|
|
|
|
186,682
|
|
|
|
(182,947
|
)
|
|
|
25,553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.79
|
|
per
share
|
|
|
88,791
|
|
|
|
88
|
|
|
|
69,912
|
|
|
|
|
|
|
|
70,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.71
|
|
per
share
|
|
|
7,805,981
|
|
|
|
7,806
|
|
|
|
5,534,441
|
|
|
|
|
|
|
|
5,542,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
for the year ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,979,396
|
)
|
|
|
(5,979,396
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2006
|
|
|
29,711,943
|
|
|
|
29,712
|
|
|
|
5,791,035
|
|
|
|
(6,162,343
|
)
|
|
|
(341,596
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.79
|
|
per
share
|
|
|
152,213
|
|
|
|
152
|
|
|
|
119,848
|
|
|
|
|
|
|
|
120,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.71
|
|
per
share
|
|
|
126,844
|
|
|
|
127
|
|
|
|
89,932
|
|
|
|
|
|
|
|
90,059
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued pursuant to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a
Private Placement for cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.10
|
|
per
share
|
|
|
76,000
|
|
|
|
76
|
|
|
|
7,524
|
|
|
|
|
|
|
|
7,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributed
Capital
|
|
|
-
|
|
|
|
-
|
|
|
|
10,000
|
|
|
|
|
|
|
|
10,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
issued for cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
@
|
|
$
|
0.50
|
|
per
share
|
|
|
100,000
|
|
|
|
100
|
|
|
|
49,900
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
for the yea ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(402,509
|
)
|
|
|
(402,509
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2007
|
|
|
30,167,000
|
|
|
$
|
30,167
|
|
|
$
|
6,068,239
|
|
|
$
|
(6,564,852
|
)
|
|
$
|
(466,446
|
)
|
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Statements
of Cash Flows
|
|
|
|
|
|
|
|
Accumulated
from
|
|
|
|
|
|
|
|
|
|
July
12, 2005
|
|
|
|
Year
Ended
|
|
|
Year
Ended
|
|
|
(inception)
through
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
$
|
(402,509
|
)
|
|
$
|
(5,979,396
|
)
|
|
$
|
(6,564,852
|
)
|
Common
stock issued for services
|
|
|
90,059
|
|
|
|
5,542,247
|
|
|
|
5,640,806
|
|
Depreciation
& Amortization
|
|
|
3,624
|
|
|
|
3,016
|
|
|
|
7,027
|
|
Changes
in Operating Assets and Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
(Increase)
Decrease in Accounts Receivable
|
|
|
(5,323
|
)
|
|
|
|
|
|
|
(5,323
|
)
|
(Increase)
Decrease in Deferred Financing
|
|
|
25,000
|
|
|
|
-
|
|
|
|
-
|
|
(Increase)
Decrease in Prepaid Expense
|
|
|
(5,056
|
)
|
|
|
-
|
|
|
|
(5,056
|
)
|
Increase
(Decrease) in Accounts Payable
|
|
|
14,156
|
|
|
|
122,687
|
|
|
|
136,843
|
|
Increase
(Decrease) in Accrued Interest
|
|
|
26,880
|
|
|
|
11,563
|
|
|
|
38,774
|
|
Increase
(Decrease) in Accrued Liabilities
|
|
|
51,376
|
|
|
|
|
|
|
|
51,376
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash (Used) by Operating Activities
|
|
|
(201,793
|
)
|
|
|
(299,883
|
)
|
|
|
(700,405
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
(9,127
|
)
|
|
|
|
|
|
|
(9,127
|
)
|
Purchase
of Property and Equipment
|
|
|
(527
|
)
|
|
|
(11,190
|
)
|
|
|
(22,937
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash (Used) by Investing Activities
|
|
|
(9,654
|
)
|
|
|
(11,190
|
)
|
|
|
(32,064
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from Stock Issuances
|
|
|
177,600
|
|
|
|
70,000
|
|
|
|
447,600
|
|
Capital
Contributed
|
|
|
10,000
|
|
|
|
|
|
|
|
10,000
|
|
Proceeds
from Notes Payable - Related Party
|
|
|
69,006
|
|
|
|
236,747
|
|
|
|
320,253
|
|
Repayment
of Notes Payable - Related Party
|
|
|
(43,193
|
)
|
|
|
|
|
|
|
(43,193
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Provided by Financing Activities
|
|
|
213,413
|
|
|
|
306,747
|
|
|
|
734,660
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
(Decrease) in Cash
|
|
|
1,966
|
|
|
|
(4,326
|
)
|
|
|
2,191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and Cash Equivalents at Beginning of Period
|
|
|
225
|
|
|
|
4,551
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and Cash Equivalents at End of Period
|
|
$
|
2,191
|
|
|
$
|
225
|
|
|
$
|
2,191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Paid for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
432
|
|
|
$
|
6,381
|
|
|
$
|
6,813
|
|
Income
Taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non
cash Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock issued for services
|
|
$
|
90,059
|
|
|
$
|
5,542,247
|
|
|
$
|
5,640,806
|
|
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 1 –
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a.
Organization
The
consolidated financial statements presented are those of Timeshare Holdings,
Inc., (“THoldings”) and its wholly-owned subsidiary, Timeshareloans.Com, Inc.,
(“TSL”), a development stage company. The consolidated entity
presented herewith utilizes the financial history of TSL prior to the merger,
more fully described in the following paragraphs. Collectively, they are
referred to herein as the "Company".
TSL was
incorporated in Nevada on July 12, 2005 with the goal of providing consumer
financing for those individuals and entities seeking to acquire, dispose or
refinance timeshare intervals or equivalents through a secondary or resale
market. Pursuant to Statement of Financial Accounting Standard No.7,
“Accounting and Reporting by Development Stage Enterprises”, the Company is
classified as a development stage company.
The
Company is headquartered in Las Vegas, Nevada and also maintains an office in
Irvine, California.
b.
Basis of
Presentation and Accounting Method
The
accompanying consolidated financial statements have been prepared in accordance
with the rules and regulations of the United States Securities and Exchange
Commission, (“SEC”) for the presentation of financial
information. These consolidated financial statements, in the opinion
of management, include all adjustments necessary to present fairly the
consolidated balance sheet, consolidated operating results and consolidated cash
flows for the period presented in accordance with accounting principles
generally accepted in the United States of America (“GAAP”).
The
Company recognizes income and expense on the accrual basis of
accounting. The Company has elected a December 31 year
end.
c. The Principles of
Consolidation
The
consolidated financial statements include the accounts of Timeshare Holdings,
Inc. and its wholly owned subsidiary, TimeShareLoans.com, Inc. All
material inter-company accounts and transactions have been eliminated in the
consolidation.
d.
Revenue Recognition
The
Company applies the provisions of SEC Staff Accounting Bulletin No. 104,
"Revenue Recognition in Financial Statements" ("SAB 104"), which provides
guidance on the recognition, presentation and disclosure of revenue in financial
statements filed with the SEC. SAB 104 outlines the basic criteria that must be
met to recognize revenue and provides guidance for disclosure related to revenue
recognition policies. In general, the Company recognizes revenue related to the
origination of short term, high yield consumer loans. The Company has
three main revenue streams that are: origination fees, interest spread and
servicing fees.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 1 –
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
The
Company's revenues are generated from the sale of its loan products, and
performance of professional services regarding the origination and servicing of
consumer loans.
Origination
Fees – Origination fees are fees that the Company charges to approved
borrowers. These fees range from $899 to $1999 based upon the
underlying loan amount of the vacation interval product being purchased or
re-financed that secures the loan facility. These fees are earned and
collected from the borrower at the close of escrow of each consumer loan
transaction, and may be changed from time to time based on market
conditions.
Interest
Spread – The Interest Spread (the difference between the Company’s cost of
funds, interest expense, and the interest income that the Company earns from its
consumer loan facilities) is estimated at an arbitrage factor of 6%. The Company
accrues interest income as it is earned and interest expense as it is
incurred.
Servicing
fees- The Company will assess a servicing fee of $6.00 per month on all active
loan receivables. These fees will be billed to the loan obligor
monthly and collected along with the monthly mortgage payments of pricipal and
interest. These fees will be used to offset the servicing software
costs incurred by the Company. Net income per month is projected to
be $.75 per active loan. The Company recognizes servicing fee income on a cash
basis.
e. Cash
and Cash Equivalents
The
Company considers all highly liquid investments with maturities of three months
or less to be cash equivalents.
f.
Receivables
The
company establishes provisions for losses on accounts receivable if it
determines that it will not collect all or part of the outstanding
balance. The Company regularly reviews collectibility and establishes
or adjusts the allowance as necessary using the specific identification method.
As a development stage company, the Company has not yet commenced operations;
therefore there were no consumer accounts receivable at December 31, 2007 or at
December 31, 2006.
The
Company booked a receivable resulting from sub-tenants occupancy of space at the
Company’s Irvine office. These amounts are expected to be received during the
first and second quarters of 2008.
g.
Property & Equipment
Property
and equipment are recorded at cost. Depreciation is recorded using
the straight line method over the estimated useful lives of between 3 and 7
years.
Maintenance
and repairs are charged to expense as incurred; major renewals and betterments
are
capitalized. When items of property and equipment are sold or
retired, the related cost and accumulated depreciation is removed from the
accounts and any gain or loss is included in the results of
operations. Depreciation expense for the period ended December 31,
2007 and December 31, 2006 was $ 3,624 and $ 3,016 respectively.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 1 –
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
Property
and equipment consist of the following:
|
|
December 31, 2007
|
|
|
December 31, 2006
|
|
|
|
|
|
|
|
|
Furniture
and Equipment
|
|
$
|
22,937
|
|
|
$
|
22,410
|
|
Less
Accumulated Depreciation
|
|
|
(7,027
|
)
|
|
|
(3,403
|
)
|
Total
Property & Equipment
|
|
$
|
15,910
|
|
|
$
|
19,007
|
|
The
Company accounts for its long-lived assets in accordance with SFAS No.144,
"Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No. 144
requires that long-lived assets be reviewed for impairment whenever events or
changes in circumstances indicate that the historical cost carrying value of an
asset may no longer be appropriate. The Company assesses
recoverability of the carrying value of an asset by estimating the future net
cash flows expected to result from the asset, including eventual
disposition. If the future net cash flows are less than the carrying
value of the asset, an impairment loss is recorded equal to the difference
between the asset's carrying value and fair value or disposable
value.
h.
Offering Costs
The
Company capitalizes syndication costs, consisting of items incurred for the
packaging and promotion of syndicating the Company. These include
printing and preparation costs, legal costs, and tax opinions associated with
the marketing of the offering. These costs will be offset against the
offering proceeds upon its completion.
i.
Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
j.
Earnings
Per Share
Basic
earnings per share excludes dilution and is computed by dividing net income
available to common shareholders by the weighted average number of common shares
outstanding for the period. Diluted earnings per share reflects the
potential dilution that could occur if securities or other contracts to insure
common stock were exercised or converted into common stock or resulted in the
issuance of common stock that shared in the earnings of the Company. The Company
did not have any outstanding common stock equivalents at December 31, 2007 and
December 31, 2006.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 1 –
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
Earnings per share is calculated as follows:
Basic
and fully diluted earnings per share:
|
|
December 31,2007
|
|
|
December 31,2006
|
|
Net
loss
|
|
|
(402,509
|
)
|
|
|
(5,979,396
|
)
|
|
|
|
|
|
|
|
|
|
Weighted
average shares
|
|
|
30,112,526
|
|
|
|
24,962,066
|
|
|
|
|
|
|
|
|
|
|
Loss
per share
|
|
$
|
(0.01
|
)
|
|
$
|
(0.24
|
)
|
k.
Capital
Structure and Security Rights
Common
stock – The Company is authorized to issue three hundred million (300,000,000)
shares of common stock, par value $0.001 per share, of which thirty million, one
hundred sixty-seven thousand (30,167,000) shares have been issued. All common
shares are equal to each other with respect to voting, and dividend rights, and
are equal to each other with respect to liquidation rights.
l.
Recently Enacted Accounting Standards
In
December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements, an amendment of ARB No. 51 (“SFAS
160”). SFAS 160 will change the accounting and reporting for minority
interests, which will be recharacterized as noncontrolling interests and
classified as a component of equity. This new consolidation method will
significantly change the accounting for transactions with minority interest
holders. SFAS 160 is effective for us on January 1, 2009, and is not
expected to have a material effect on our consolidated financial
statements.
In
December 2007, the Financial Accounting Standards Board (“FASB”) issued SFAS No.
141(R), “Business Combinations” (“SFAS 141R”). SFAS 141R establishes
the principles and requirements for how an acquirer recognizes and measures in
its financial statements the identifiable assets acquired, the liabilities
assumed, any noncontrolling interest in the acquiree, and the goodwill
acquired. SFAS 141R also establishes disclosure requirements to
enable the evaluation of the nature and financial effects of the business
combination. SFAS 141R is effective for us on January 1, 2009, and is
not expected to have a material effect on our consolidated financial
statements.
In
February 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial
Assets and Financial Liabilities, including an amendment of FASB Statement No.
115” (“SFAS 159”). SFAS 159 permits companies to choose to measure
many financial instruments and certain other items at fair value that are not
currently required to be measured at fair value, and establishes presentation
and disclosure requirements designed to facilitate comparisons between companies
that choose different measurement attributes for similar types of assets and
liabilities. SFAS 159 is effective for us on January 1, 2008, and is
not expected to have a material effect on our consolidated financial
statements.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
Note 1-
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
In
September 2006, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 158, "Employers' Accounting for Defined
Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements
No. 87, 88, 106 and 132R" ("SFAS 158"). SFAS 158 requires employers that sponsor
defined benefit pension and post retirement plans to recognize previously
unrecognized actuarial losses and prior service costs in the statement of
financial position and to recognize future changes in these amounts in the year
in which changes occur through comprehensive income. As a result, the statement
of financial position will reflect funded status of those plans as an asset or
liability. Additionally, employers are required to measure the funded status of
a plan as of the date of their year-end statements of financial position and
provide additional disclosures. SFAS 158 is effective for financial statements
issued for fiscal years ending after December 15, 2006 for companies whose
securities are publicly traded. The Company does not expect the adoption of SFAS
158 to have a significant effect on its financial position or results of
operation. In September 2006, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 157, "Fair Value Measurements"
("SFAS 157"), which defines fair value, establishes a framework for measuring
fair value in generally accepted accounting principles ("GAAP"), and expands
disclosures about fair value measurements. Where applicable, SFAS 157 simplifies
and codifies related guidance within GAAP and does not require any new fair
value measurements. SFAS 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007, and interim periods within those
fiscal years. Earlier adoption is encouraged. The Company does not expect the
adoption of SFAS 157 to have a significant effect on its financial position or
results of operation.
In June
2006, the Financial Accounting Standards Board issued FASB Interpretation No.
48, "Accounting for Uncertainty in Income Taxes – an interpretation of FASB
Statement No. 109" ("FIN 48"), which prescribes a recognition threshold and
measurement attribute for the financial statement recognition and measurement of
a tax position taken or expected to be taken in a tax return. FIN 48 also
provides guidance on de-recognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition. FIN 48 is effective
for fiscal years beginning after December 15, 2006. The Company does not expect
the adoption of FIN 48 to have a material impact on its financial reporting, and
the Company is currently evaluating the impact, if any, the adoption of FIN 48
will have on its disclosure requirements.
In March
2006, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 156, "Accounting for Servicing of Financial Assets --
an Amendment of FASB Statement No. 140 ("SFAS 156")." This statement requires an
entity to recognize a servicing asset or servicing liability each time it
undertakes an obligation to service a financial asset by entering into a
servicing contract in any of the following situations: a transfer of the
servicer's financial assets that meets the requirements for sale accounting; a
transfer of the servicer's financial assets to a qualifying special-purpose
entity in a guaranteed mortgage securitization in which the transferor retains
all of the resulting securities and classifies them as either available-for-sale
securities or trading securities; or an acquisition or assumption of an
obligation to service a financial asset that does not relate to financial assets
of the servicer or its consolidated affiliates. The statement also requires all
separately recognized servicing assets and servicing liabilities to be initially
measured at fair value, if practicable, and permits an entity to choose either
the amortization or fair value method for subsequent measurement of each class
of servicing assets and liabilities. The
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
Note 1-
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
statement
further permits, at its initial adoption, a one-time reclassification of
available-for-sale securities to trading securities by entities with recognized
servicing rights, without calling into question the treatment of other
available-for-sale securities under Financial Accounting Standards Board
Statement No. 115, provided that the available-for-sale securities are
identified in some manner as offsetting the entity's exposure to changes in fair
value of servicing assets or servicing liabilities that a servicer elects to
subsequently measure at fair value and requires separate presentation of
servicing assets and servicing liabilities subsequently measured at fair value
in the statement of financial position and additional disclosures for all
separately recognized servicing assets and servicing liabilities. SFAS 156 is
effective for fiscal years beginning after September 15, 2006, with early
adoption permitted as of the beginning of an entity's fiscal year. Management
believes the adoption of
SFAS 156
will have no immediate impact on the Company's financial condition or results of
operations.
In
February 2006, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 155, "Accounting for Certain Hybrid Financial
Instruments – an amendment of FASB Statements No. 133 and 140" ("SFAS 155"), to
(a) permit fair value re-measurement for any hybrid financial instrument that
contains an embedded derivative that otherwise would require bifurcation, (b)
clarify which interest-only strip and principal-only strip are not subject to
the requirements of Statement 133, (c) establish a requirement to
evaluate
interests in securitized financial assets to identify interests that are
freestanding derivatives or that are hybrid financial instruments that contain
an embedded derivative requiring bifurcation, (d) clarify that concentrations of
credit risk in the form of subordination are not embedded derivatives, and (e)
amend Statement 140 to eliminate the prohibition on a qualifying special-purpose
entity from holding a derivative financial instrument that pertains to a
beneficial interest other than another derivative financial instrument. This
statement is effective for financial statements for fiscal years beginning after
September 15, 2006. Earlier adoption of SFAS 155 is permitted as of the
beginning of an entity's fiscal year, provided the entity has not yet issued any
financial statements for that fiscal year. Management believes SFAS 155 will
have no impact on the financial statements of the Company once
adopted.
The
implementation of the provisions of these pronouncements is not expected to have
a significant effect on the Company's consolidated financial statement
presentation.
m. Fair
Value of Financial Instruments
The fair
value of the Company’s cash and cash equivalents, receivables, accounts payable
and notes payable approximate carrying value based on their effective interest
rates compared to current market prices.
NOTE 2 –
GOING CONCERN
The
accompanying Financial Statements have been prepared assuming that the company
will continue as a going concern. The company has recurring net
losses, negative working capital and negative cash flow from operations,
and is dependent upon raising capital to continue operations. Our
ability to continue as a going concern is subject to our ability to generate a
profit and/or obtain necessary funding from outside sources, including obtaining
additional funding from the sale of our securities, increasing sales or
obtaining loans and grants from
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 2 –
GOING CONCERN (continued)
various
financial institutions where possible. The financial statements do not include
any adjustments that might result from the outcome of this
uncertainty. It is Management’s plan to generate additional working
capital from an Initial Public Offering to investors, as more fully discussed in
the following paragraphs, and then begin offering a new and better way to
accommodate purchases and re-finances of resale timeshares by
consumers.
NOTE 3 -
INCOME TAXES
The
Company has adopted FASB 109 to account for income taxes. The Company
currently has no issues that create timing differences that would mandate
deferred tax expense. Net operating losses would create possible tax
assets in future years. Due to the uncertainty as to the utilization
of net operating loss carry forwards an evaluation allowance has been made to
the extent of any tax benefit that net operating losses may
generate. No provision for income taxes has been recorded due to the
net operating loss carry forward that will be offset against further
taxable income. No tax benefit has been reported in the financial
statements.
Deferred
tax assets and the valuation account as of December 31, 2007 is as
follows:
Deferred
tax asset:
|
|
December 31, 2007
|
|
|
December 31, 2006
|
|
Net
operating loss carry forward
|
|
|
2,232,050
|
|
|
|
2,095,197
|
|
Valuation
allowance
|
|
|
(2,232,050
|
)
|
|
|
(2,095,197
|
)
|
|
|
|
0
|
|
|
|
0
|
|
The
components of income tax expense are as follows:
|
|
December 31, 2007
|
|
|
December 31, 2006
|
|
Current
Federal Tax
|
|
|
|
|
|
|
Current
State Tax
|
|
|
|
|
|
|
Change
in NOL Benefit
|
|
|
136,853
|
|
|
|
2,032,995
|
|
Valuation
allowance
|
|
|
(136,853
|
)
|
|
|
(2,032,995
|
)
|
|
|
|
0
|
|
|
|
0
|
|
The
Company has incurred losses that can be carried forward to offset future
earnings if conditions of the Internal Revenue Codes are met. These
losses are as follows:
Year/Period
of Loss
|
|
Amount
|
|
Expiration
Date
|
December
31, 2005
|
|
$
|
182,947
|
|
2025
|
December
31, 2006
|
|
$
|
5,979,396
|
|
2026
|
|
|
$
|
402,509
|
|
2027
|
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 4 -
RELATED PARTY TRANSACTIONS (NOTE PAYABLE RELATED PARTY)
The
Company has issued Promissory Notes to corporate officers, directors and
investors that are also shareholders of Timeshare Holdings, Inc. The Notes are
unsecured, bare interest at rates of 9.5%-12% per annum and are due on demand.
Accrued interest as of December 31, 2007 was $ 38,774.
The
Company’s President funded the Company with Loans for $7,500 at an interest rate
of 12% in 2005, and also funded the Company with loans for $45,190, at an
interest rate of 10% and $40,493, at an interest rate of 12% in 2006. In 2007,
the President funded Loans in the amount of $30,898 at an interest rate of 12%.
The Company has repaid $ 43,193 of those loans in 2007. All notes are due on
demand. The Company’s President indirectly owns 10,311,000 shares,
34.4%, of the total issued and outstanding shares of the Company through a
family trust. Accrued interest as of December 31, 2007 was $12,515.
The
Company’s Chief Financial Officer funded the Company with Loans of $158,064, at
an interest rate of 12% in 2006. In 2007, the Chief Financial Officer, funded
the Company with Loans totaling $8,108, at an interest rate of 12%. All notes
are due on demand. The Company’s Chief Financial Officer indirectly owns
6,514,000 shares, 21.7%, of the total issued and outstanding shares of the
Company through a family trust. Accrued interest as of December 31, 2007 was $
25,304.
The
Company issued Promissory Notes in the amount of $ 30,000 to investors that are
also shareholders of Timeshare Holdings, Inc. for loans made to the company made
in 2007. The Promissory Notes bare interest at a rate of 9.5% per annum, are
unsecured and are due upon demand. Accrued interest as of December
31, 2007 was $ 955.
NOTE 5 -
COMMITMENTS AND CONTINGENCIES
Litigation
The
Company is currently not a party to any pending litigation, and is not aware of
any threatened litigation that has not been addressed and/or
resolved.
Operating
Leases
The
Company currently leases space for its Irvine, California office, consisting of
approximately 4,624 square feet of office space, located at 16842 Von Karman
Ave, Bldg. 400, 2nd Floor, Irvine, California. Monthly lease payments
are $8,430 and the lease expires on June 30, 2010.
The
Company's administrative staff and headquarters are located in Las Vegas,
Nevada. The office space is located at 2350 S Jones Blvd, Ste. 101,
Las Vegas, Nevada, 89146. The monthly lease payment of the location is $650 per
month, for approximately 150 square feet. The term of the Office Services
Agreement is determined on a month-to-month basis. The Company
anticipates increasing square footage as needed, and rent increasing to $1250
per month in 2008, and $1500 per month by 2009.
The
Company follows the guidance in the FASB Technical Bulletin No. 85-3 “Accounting
for Operating Leases with Scheduled Rent Increases” and records rent expense
using straight-line over the life of each lease.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
Total
Lease Commitments
|
Year
|
|
December
31,
|
|
|
2008
|
|
|
94,474
|
|
|
2009
|
|
|
94,474
|
|
|
2010
|
|
|
78,729
|
|
|
Thereafter
|
|
|
-
|
|
|
Total
|
|
$
|
267,677
|
|
Rent
Expense for the period ended December 31, 2007 and December 31, 2006 was $97,437
and $ 52,380, respectively.
NOTE 6 –
SUBSEQUENT EVENTS
In March
of 2008 the Company had effectively registered or “Blue Skied” 10,000,000 shares
of its common stock for sale in the state of California through a Private
Placement. The state of California requires investors to meet or
exceed “Super Suitability” standards and places additional restrictions on the
trading of those shares. The potential net proceeds of this offering will be up
to $5,000,000. As of April 7, 2008 the Company has sold 172,331
shares of common stock to eight investors for $26,000.
NOTE 7 –
STOCKHOLDERS’ (DEFICIT)
As a
result of the Agreement, dated March 9
th
2007,
as described above, THoldings issued 29,991,000 shares of common stock to the
shareholders of TSL in exchange for the 1,182,700 shares of common stock of TSL,
a Development Stage Company, which is reflected in our financial presentation as
a forward split. The transaction represented an exchange of 100% of the
outstanding and issued common shares of TSL, a Development Stage
Company. The existing Shareholders of TSL, exchanged their
shares desiring that the transaction be qualified as a tax free reorganization
under Section 368 (a)(1)(B) of the Internal Revenue Code of 1968, as
amended. The Internal Revenue Service, “IRS”, has not ruled on this
transaction.
During
the first and second quarter of 2007, THoldings issued and sold for cash 76,000
shares of its common stock at a price of $0.10 to qualified investors through a
private placement which was exempt from the registration and prospectus delivery
requirements of the Securities Act of 1933, as amended.
During
the first quarter of 2007, the Company issued 152,213 (post merger) shares of
common stock for cash at a per share price of $0.79. Accordingly,
common stock and additional paid-in-capital have been charged $152 and $119,848.
Also during the first quarter of 2007, the Company issued an aggregate 126,844
(post merger) common shares of the Company for services rendered on behalf of
the Company. The shares were valued at a per share price of
$0.71.
During
the second quarter of 2007, the Company issued 100,000 shares of common stock
for cash at a price of $.50 per share. Accordingly, common stock and
additional paid in capital have been charged $100 and $49,900
respectively.
TIMESHARE
HOLDINGS, INC.
(A
Development Stage Company)
Notes to
the Consolidated Financial Statements
December
31, 2007 and 2006
NOTE 7 –
STOCKHOLDERS’ (DEFICIT) (continued)
The
Company did not sell nor issue shares for services during the third and fourth
quarter of 2007. The balance of authorized and issued shares of
Timeshare Holdings, Inc. common stock as of December 31, 2007 is 30,167,000
shares.
During
2006, the Company issued a total of 7,805,981 (post merger) shares of common
stock for services rendered on behalf of the Company. The shares were
valued at $0.71 per share.
During
the years ended December 31, 2005 and 2006, the Company issued 253,688 and
88,791 (post merger) shares of common stock for cash. The shares were
issued at a price of $0.79 per share. Accordingly, common stock and
additional paid-in-capital have been charged $254 and $199,746, and $88 and
$69,912, respectively.
During
the year ended December 31, 2005, the Company issued 21,563,483 (post merger)
shares to certain individuals as founder shares. These shares were
valued at $0.01 per share. Accordingly, common stock has been
credited in the amount of $21,564 and additional paid-in-capital has been
debited $13,064 to properly reflect the transaction subsequent to the merger and
plan of reorganization.
(A
Development Stage Company)
Consolidated
Balance Sheets
Current
Assets
|
|
March
31,
2008
|
|
|
December
31,
2007
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
3,928
|
|
|
$
|
2,191
|
|
Receivable
|
|
|
13,284
|
|
|
|
5,323
|
|
Prepaid
Expense
|
|
|
5,056
|
|
|
|
5,056
|
|
Total
Current Assets
|
|
|
22,268
|
|
|
|
12,570
|
|
Fixed
Assets
|
|
|
|
|
|
|
|
|
Furniture,
Fixture
&
Equipment (Net)
|
|
|
15,010
|
|
|
|
15,910
|
|
Total
Fixed
Assets
|
|
|
15,010
|
|
|
|
15,910
|
|
Other
Assets
|
|
|
|
|
|
|
|
|
Deposit
|
|
|
9,127
|
|
|
|
9,127
|
|
Total
Other Assets
|
|
|
9,127
|
|
|
|
9,127
|
|
TOTAL
ASSETS
|
|
$
|
46,405
|
|
|
$
|
37,607
|
|
LIABILITIES
AND
STOCKHOLDERS'
{DEFICIT)
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Accounts
Payable
|
|
$
|
156,890
|
|
|
$
|
136,843
|
|
Accrued
Interest
|
|
|
46,527
|
|
|
|
38,774
|
|
Accrued
Expenses
|
|
|
62,204
|
|
|
|
51,376
|
|
Stock
Deposits
|
|
|
7,500
|
|
|
|
|
|
Note
Payable- Related Party
|
|
|
297,010
|
|
|
|
277,060
|
|
Total Current
Liabilities
|
|
|
570,131
|
|
|
|
504,053
|
|
Total
Liabilities
|
|
|
570,131
|
|
|
|
504,053
|
|
Commitments
|
|
|
|
|
|
|
|
|
Stockholders'
(Deficit)
|
|
|
|
|
|
|
|
|
Common
stock - March 31, 2008: 300,000,000 Shares Authorized
at
$0.001 Par Value; 30,167,000 Issued and Outstanding;
|
|
|
30,167
|
|
|
|
30,167
|
|
Additional
Paid-In-Capital
|
|
|
6,068,239
|
|
|
|
6,068,239
|
|
Deficit
accumulated during the Development Stage
|
|
|
(6,622,132
|
)
|
|
|
(6,564,852
|
)
|
Total
Stockholders'
(Deficit)
|
|
|
(523,726
|
)
|
|
|
(466,446
|
)
|
TOTAL
LIABILITIES AND
STOCKHOLDERS'
(DEFICIT)
|
|
$
|
46,405
|
|
|
$
|
37,607
|
|
The
accompanying notes are an integral part of these consolidated financial
statements.
Timeshare
Holdings, Inc.
(A
Development Stage Company)
Consolidated
Statements of Operations
|
|
|
|
|
Accumulated
from July 12, 2005
|
|
|
|
March
31,
|
|
|
(inception)
through Mach 31,
|
|
|
|
2008
|
|
|
2007
|
|
|
2008
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues,
Net
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries
|
|
|
12,994
|
|
|
|
11,191
|
|
|
|
197,527
|
|
Compensation
Cost
|
|
|
|
|
|
|
90,059
|
|
|
|
5,632,306
|
|
Professional
Fees
|
|
|
10,439
|
|
|
|
35,867
|
|
|
|
326,981
|
|
General
&
Administrative
|
|
|
38,549
|
|
|
|
16,980
|
|
|
|
437,835
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Operating Expenses
|
|
|
61,982
|
|
|
|
154,097
|
|
|
|
6,594,649
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
From Operations
|
|
|
(61,982
|
)
|
|
|
(154,097
|
)
|
|
|
(6,594,649
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Income
(Expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Income
|
|
|
12,724
|
|
|
|
0
|
|
|
|
26,575
|
|
Interest
Expense
|
|
|
(8,022
|
)
|
|
|
(6,599
|
)
|
|
|
(54,058
|
)
|
Total
Other
Income
(Expense)
|
|
|
4,702
|
|
|
|
(6,599
|
)
|
|
|
(27,483
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
Before Income Taxes
|
|
|
(57,280
|
)
|
|
|
(160,696
|
)
|
|
|
(6,622,132
|
)
|
Income
Tax Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Loss
|
|
$
|
(57,280
|
)
|
|
$
|
(160,696
|
)
|
|
$
|
(6,622,132
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and fully diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
per share
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding
|
|
|
30,167,000
|
|
|
|
30,008,303
|
|
|
|
|
|
The
accompanying notes are an integral part of these consolidated financial
statements.
(A
Development Stage Company)
Statements
of Stockholders' Deficit
For the
Period July 12, 2005 (Inception) to March 31, 2008
|
|
Common
Stock
|
|
|
Paid
in Capital
|
|
|
Accumulated
|
|
|
Total
Stockholders'
|
|
|
|
Shares
|
|
|
Amount
|
|
|
|
|
|
Deficit
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
July 12, 2005
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
-
|
|
|
$
|
-
|
|
Shares issued for
Founders
@ $
0.01 per
share
|
|
|
21,563,483
|
|
|
|
21,564
|
|
|
|
(13,064
|
)
|
|
|
|
|
|
8,500
|
|
Shares
issued for cash
@ $
0.79 per
share
|
|
|
253,688
|
|
|
|
254
|
|
|
|
199,746
|
|
|
|
|
|
|
200,000
|
|
Loss
for the period ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(182,947
|
)
|
|
|
(182,947
|
)
|
Balance
December 31, 2005
|
|
|
21,817,171
|
|
|
|
21,818
|
|
|
|
186,682
|
|
|
|
(182,947
|
)
|
|
|
25,553
|
|
Shares
Issued for cash
$
0.79 per
share
|
|
|
88,791
|
|
|
|
88
|
|
|
|
69,912
|
|
|
|
|
|
|
|
70,000
|
|
Shares
issued for services
@ $
0.71 per
share
|
|
|
7,805,981
|
|
|
|
7,806
|
|
|
|
5,534,441
|
|
|
|
|
|
|
|
5,542,247
|
|
Loss
for the year ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,979,396
|
)
|
|
|
(5,979,396
|
)
|
Balance
December 31, 2006
|
|
|
29,711,943
|
|
|
|
29,712
|
|
|
|
5,791,035
|
|
|
|
(6,162,343
|
)
|
|
|
(341,596
|
)
|
Shares
Issued for cash
@ $
0.79 per
share
|
|
|
152,213
|
|
|
|
152
|
|
|
|
119,848
|
|
|
|
|
|
|
|
120,000
|
|
Shares
Issued for services
@ $
0.71 per
share
|
|
|
126,844
|
|
|
|
127
|
|
|
|
89,932
|
|
|
|
|
|
|
|
90,059
|
|
Shares
issued pursuant to
a
Private Placement for cash
@ $
0.10 per
share
|
|
|
76,000
|
|
|
|
76
|
|
|
|
7,524
|
|
|
|
|
|
|
|
7,600
|
|
Contributed
Capital
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
|
|
|
|
|
10,000
|
|
Shares
issued for cash
@ $
0.50 per
share
|
|
|
100,000
|
|
|
|
100
|
|
|
|
49,900
|
|
|
|
|
|
|
|
50,000
|
|
Loss
for the year ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(402,509
|
)
|
|
|
(402,509
|
)
|
Balance
December 31, 2007
|
|
|
30,167,000
|
|
|
$
|
30,167
|
|
|
$
|
6,068,239
|
|
|
$
|
(6,564,852
|
)
|
|
$
|
(466,446
|
)
|
Loss
for Quarter ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31, 2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(57,280
|
)
|
|
|
(57,280
|
)
|
Balance
March 31, 2008 (unaudited)
|
|
|
30,167,000
|
|
|
$
|
30,167
|
|
|
$
|
6,068,239
|
|
|
$
|
(6,622,132
|
)
|
|
$
|
(523,726
|
)
|
The
accompanying notes are an integral part of these consolidated financial
statements.
Timeshare
Holdings, Inc.
(A
Development State Company)
Consolidated
Statements of Cash Flows
|
|
|
|
|
Accumulated
from July 12, 2005
|
|
|
|
3
Months Ended
March
31,
|
|
|
(inception)
through March 31,
|
|
|
|
2008
|
|
|
2007
|
|
|
2008
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
Cash
Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
$
|
(57,280
|
)
|
|
$
|
(160,696
|
)
|
|
$
|
(6,622,132
|
)
|
Common
stock issued for services
|
|
|
-
|
|
|
|
90,059
|
|
|
|
5,640,806
|
|
Depreciation
&
Amortization
|
|
|
900
|
|
|
|
908
|
|
|
|
7,927
|
|
Changes
in Operating Assets and Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
(Increase)
Decrease in Accounts Receivable
|
|
|
(7,961
|
)
|
|
|
-
|
|
|
|
(13,284
|
)
|
(Increase)
Decrease in Prepaid Expense
|
|
|
-
|
|
|
|
(3,000
|
)
|
|
|
(5,056
|
)
|
Increase
(Decrease) in Accounts Payable
|
|
|
20,047
|
|
|
|
(44,967
|
)
|
|
|
156,890
|
|
increase
(Decrease) in Accrued Interest
|
|
|
7,753
|
|
|
|
6,003
|
|
|
|
46,527
|
|
Increase
(Decrease) in Accrued Liabilities
|
|
|
10,828
|
|
|
|
-
|
|
|
|
62,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash (Used) by Operating Activities
|
|
|
(25,713
|
)
|
|
|
(111,693
|
)
|
|
|
(726,118
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
-
|
|
|
|
-
|
|
|
|
(9,127
|
)
|
Purchase
of Property and Equlpment
|
|
|
-
|
|
|
|
-
|
|
|
|
(22,937
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash (Used) by Investing Activities
|
|
|
-
|
|
|
|
-
|
|
|
|
(32,064
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from Stock Deposits
|
|
|
7,500
|
|
|
|
|
|
|
|
7,500
|
|
Proceeds
from Stock Issuances
|
|
|
-
|
|
|
|
120,000
|
|
|
|
447,600
|
|
Capital
Contributed
|
|
|
-
|
|
|
|
-
|
|
|
|
10,000
|
|
Proceeds
from Notes Payable - Related Party
|
|
|
19,950
|
|
|
|
3,750
|
|
|
|
340,203
|
|
Repayment
of Notes Payable - Related Party
|
|
|
|
|
|
|
(6,200
|
)
|
|
|
(43,193
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Provided by Financing Activities
|
|
|
27,450
|
|
|
|
117,550
|
|
|
|
762,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
(Decrease) In Cash
|
|
|
1,737
|
|
|
|
5,857
|
|
|
|
3,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and Cash Equivalents at Begining of Period
|
|
|
2,191
|
|
|
|
225
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and Cash Equivalents at End of Period
|
|
$
|
3,928
|
|
|
$
|
6,08
2
|
|
|
$
|
3,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Paid for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Intrest
|
|
$
|
-
|
|
|
$
|
596
|
|
|
$
|
6,813
|
|
Income
Taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non
cash Financing Activites:
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock Issued for services
|
|
$
|
-
|
|
|
$
|
90,059
|
|
|
$
|
5,640,806
|
|
Common
Stock Issued for Subscriptions Payable
|
|
$
|
|
|
|
$
|
7,000
|
|
|
$
|
7,000
|
|
The
accompanying notes are an integral part of these consolidated financial
statements.
Timeshare
Holdings, Inc.
(A
Development State Company)
Notes to
the Consolidated Financial Statements (unaudited)
March 31,
2008
NOTE 1 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
The
consolidated financial statements presented are those of Timeshare Holdings,
Inc.,
("THoldings")
and
its
wholly-owned
subsidiary
,
TimeShareLoans.com
, Inc., ("TSL"),
a
development
stage company. The consolidated entity presented herewith utilizes the financial
history of TSL prior to the merger, more fully described in the following
paragraphs. Collectively, they are referred to herein as the
"Company".
TSL was
incorporated in Nevada on July 12, 2005 with the goal of providing consumer
financing for those individuals and entities seeking to acquire, dispose or
refinance timeshare intervals or equivalents through a secondary or resale
market. Pursuant to Statement of Financial Accounting Standard No.7, "Accounting
and Reporting by Development Stage Enterprises", the Company is classified as a
development stage company.
On March
9, 2007 TSL and THoldings entered into the Agreement and Plan of Reorganization,
("The Agreement"). In this transaction TSL was merged with THoldings, a shell
corporation incorporated in Nevada on January 30, 2007. It is Managements'
belief that this transaction is properly reflected as a reverse merger for
accounting purposes and the financial statement presentation is a reflection of
that belief. TSL continues as the operating entity while THoldings is reflected
as the parent company for legal purposes. As a result, we affected a forward
stock split of our outstanding shares of common stock on a pro-rata basis which
resulted in all 29,991,000 common shares of THoldings being issued to the
shareholders of TSL in exchange for all 1,182,700 outstanding common shares of
TSL.
TSL became
a
wholly
owned subsidiary of THoldings.
At the
time of consolidation, no reverse merger adjustment was needed in that there
were no shareholders in the parent company at the time of the merger. The
financial information from inception includes the financial results of the
Company from its inception on July 12, 2005 to March 31, 2008.
The
financial information included in this periodic report should be read in
conjunction with the consolidated financial statement of the Company for
quarterly periods ended March 31, 2007, and the annual period ending December
31, 2007, and related notes thereto included in form SB-2 filed with the United
States Securities and Exchange Commission ("SEC") on August 13, 2007, and the
SB-2A filed with the SEC on September
28,
2007.
The
Company is headquartered in Las Vegas, Nevada and also maintains
an
office in
Irvine, California.
Interim
Financial Reporting
The
accompanying condensed financial statements of the Company have been prepared by
the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and disclosures normally
included in financial statements prepared in accordance with accounting
principles generally accepted in the United States have been condensed or
omitted pursuant to such rules and regulations. These condensed financial
statements reflect all adjustments (consisting only of normal recurring
adjustments) that, in the opinion of management, are necessary to present
fairly
Timeshare
Holdings, Inc.
(A
Development State Company)
Notes to
the Consolidated Financial Statements (unaudited)
March 31,
2008
NOTE 1 –
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
the
results of operations of the Company for the periods presented. These condensed
financial statements should be read in conjunction with the financial statements
and the notes thereto included in the Company's Forms 10-KSB for the year ended
December 31, 2007 and forms SB-2 and
SB-2A
for the year ended
December 31, 2006. The results of operations for the three months ended March
31, 2008, are not necessarily indicative of the results that may be expected for
the fiscal year ending December 31, 2008.
Earnings
Per Share
Basic
earnings per share excludes dilution and is computed by dividing net income
available to common shareholders by the weighted average number of common shares
outstanding for the period. Diluted earnings per share reflects the potential
dilution that could occur if securities or other contracts to insure common
stock were exercised or converted into common stock or resulted in the issuance
of common stock that shared in the earnings of the Company. The Company did not
have any outstanding common stock equivalents at March 31,
2008
|
March 31,
|
|
March
31
|
|
Basic
earnings per share:
|
2008
|
|
2007
|
|
|
|
|
|
Net
loss
|
$
|
(57,280
|
)
|
$
|
(160,696
|
)
|
Weighted
average shares
|
|
30,167,000
|
|
|
30,008,303
|
|
Loss
per share
|
$
|
(.00
|
)
|
$
|
(.01
|
)
|
NOTE 2 –
GOING CONCERN
The
accompanying Financial Statements have been prepared assuming that the Company
will continue
as
a going
concern. The Company currently has no revenues, and is dependent upon raising
capital to continue operations. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
It
is Management's plan to
generate additional working capital from an Initial Public Offering to
investors, and then begin offering a new and better way to accommodate purchases
and re-finances of resale timeshares by consumers.
NOTE 3 -
RELATED PARTY TRANSACTIONS
The
Company has issued Promissory Notes to corporate officers, directors and
investors who are shareholders of the company. The Notes are unsecured, bare
interest at rates of 7%-12% per annum and are due on demand. Accrued interest as
of March 31, 2008 was $46,527.
The
Company's CEO, funded the Company with a Promissory Note for $7,500, at an
interest rate of
12%
in
2005, and also funded the Company with Promissory Notes for $45,190, at an
interest rate of 10% and $40,493, at an interest rate of 12% in 2006. The
Company's CEO funded the Company with Promissory Notes totaling $30,898 at an
interest rate of 12% in the twelve month period ended December 31, 2007. The
Company has repaid a portion of these
Timeshare
Holdings, Inc.
(A
Development State Company)
Notes to
the Consolidated Financial Statements (unaudited)
March 31,
2008
NOTE 3 -
RELATED PARTY TRANSACTIONS (continued)
notes in
the amount of $43,193 during the twelve month period ended December 31, 2007.
All notes are unsecured and due on demand. Accrued interest for the quarter
ended March 31, 2008 was $2,239. Total accrued interest through March 31, 2008
was $14,754. The Company's CEO indirectly owns 10,311,000 shares, 34.1% of the
total issued and outstanding shares, through a family trust.
The
Company's President and Treasurer, funded the Company with a Promissory Note of
$7,000, at an interest rate of 10% in 2005, funded the Company with Promissory
Notes of $151,064, at an interest rate of 12% in 2006, and also $8,108 at an
interest rate of 12% in the twelve month period ended December 31, 2007. All
notes are unsecured and due on demand. During the three month period ended March
31, 2008 the President and Treasurer funded the Company with $7,950 at an
interest rate of 12%. Accrued interest for the three month period ended March
31, 2008 was $4,738. Total accrued interest through March 31, 2008 was $30,042.
The Company's President and Treasurer indirectly owns 6,514,000 shares, 21.5% of
the total issued and outstanding shares, through a family trust.
In the
period ending December 31, 2007 the company issued Promissory Notes in the
amount of $30,000 to investors that are also shareholders of Timeshare Holdings,
Inc. These Promissory Notes bear interest at a rate of 9.5% per annum, are
unsecured, and are due upon demand. During the three month period ended March
31, 2008 the Company issued Promissory Notes in the amount of $12,000. These
Promissory Notes bear interest at rates of 7% and 7.5% rates, are unsecured and
due on demand. The accrued interest for the three month period ended March 31,
2008 was $776. Total accrued interest as of March 31, 2008 was
$1,731.
The
Company used the proceeds of these loans for operating expenses.
NOTE 4 –
STOCKHOLDERS' EQUITY
As a
result of the Agreement, dated March 9, 2007, THoldings issued 29,991,000 shares
of common stock to the shareholders of TSL in exchange for the 1,182,700 shares
of common stock of TSL, a Development Stage Company, which is reflected in our
financial presentation as a forward split. The transaction represented an
exchange of 100% of the outstanding and issued common shares of TSL, a
Development Stage Company. The existing Shareholders of TSL exchanged their
shares desiring that the transaction be qualified as a tax free reorganization
under Section 368 (a)(1)(B) of the Internal Revenue Code of 1968, as amended.
The Internal Revenue Service, "IRS", has not ruled on this
transaction.
To fund
the Company's ongoing need for capital the Company entered into The Agreement
and Plan of Reorganization, (The Agreement) dated March 9, 2007 as previously
mentioned. As a provision of this agreement the Company agreed to file with the
Security and Exchange Commission, (SEC), and use it's best efforts to make
effective a registration statement of Form SB-2A to register for resale
10,383,374 shares of common stock of selling shareholders, and an initial Public
Offering of 10,000,000 shares of the Company's previously unissued common
shares.
The SEC
approved the filing in September 2007. As a provision of the approved filing,
the 10,000,000 Public Offering shares were priced at $.50 per share as outlined
in the Prospectus. Subsequently, the Company's stock began trading as a Bulletin
Board stock, trading under the symbol OTC BB:TMSH. The stock has historically
traded in the range of $.10 to $.25 per
Timeshare
Holdings, Inc.
(A
Development State Company)
Notes to
the Consolidated Financial Statements (unaudited)
March 31,
2008
NOTE 4 –
STOCKHOLDERS' EQUITY (continued)
share.
Given the trading range, it has become increasingly difficult for the Company to
market and sell its Public Offering of 10,000,000 common shares at the
subscription price of $.50 per share; approximately double the level of the
market value. Therefore, the Company has chosen to file with the SEC a
post-effective amendment lowering the price of its Public Offering shares from
$.50 to $.10 per share which the Company believes more accurately reflects the
activity of the stock in the public market. The Company has received offers from
individual investors to purchase shares at the reduced price per share once the
post-effective amendment to its Public Offering has been approved. The Company
has accounted for these transactions as Subscriptions Payable. As of March 31,
2008 the Company has booked Stock Deposits of $7,500.
NOTE 5 –
SUBSEQUENT EVENT
As of May
18, 2008 the Company has booked as Stock Deposits an additional
$23,500.
NOTE 6 –
COMMITMENTS AND CONTINGENCIES
The
Company has engaged FJC Financial to place credit facilities on behalf of the
company. Consultant, FJC Financial, only earns a fee upon completed commitment
from a lender. The success fee is 3% plus reimbursement for any out of pocket
expenses. The Company paid FJC in advance a $3,000 non-refundable retainer which
will be deducted from the earned success fee.
TIMESHARE
HOLDINGS, INC.
10,383,374
Shares
Common
Stock
$0.001
Par Value
By
Selling Shareholders
10,000,000
Shares
Common
Stock
$.001
Par Value
By
Timeshare Holdings, Inc.
______________
PROSPECTUS
______________
May 30,
2008
PART
II.
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our
articles of incorporation provide that no director or officer shall be
personally liable for damages for breach of fiduciary duty for any act or
omission unless such acts or omissions involve intentional misconduct, fraud,
knowing violation of law, or payment of dividends in violation of Section 78.300
of the Nevada Revised Statutes.
Our
bylaws provide that we shall indemnify any and all of our present or former
directors and officers, or any person who may have served at our request as
director or officer of another corporation in which we own stock or of which we
are a creditor, for expenses actually and necessarily incurred in connection
with the defense of any action, except where such officer or director is
adjudged to be liable for negligence or misconduct in performance of duty. To
the extent that a director has been successful in defense of any proceeding, the
Nevada Revised Statutes provide that he shall be indemnified against reasonable
expenses incurred in connection therewith.
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the Company pursuant
to the foregoing provisions, or otherwise, the Company has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy and is, therefore, unenforceable.
Item
25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The
following table sets forth the expenses in connection with this Registration
Statement. We will pay all expenses of the offering. All of such expenses are
estimates
,
other than the filing fees payable to the Securities and Exchange
Commission.
|
|
|
|
|
Printing
Fees and Expenses
|
|
|
500*
|
|
|
|
|
|
|
Accounting
Fees and Expenses
|
|
|
32,000*
|
|
Blue
Sky Fees and Expenses
|
|
|
|
|
Trustee’s
and Registrar’s Fees
|
|
|
450*
|
|
|
|
|
|
|
TOTAL
|
|
$
|
96,000*
|
|
*
Estimated
Item
26. RECENT SALES OF UNREGISTERED SECURITIES
On March
9, 2007, TimeShareLoans.com and Timeshare Holdings Inc., entered into an
agreement and plan of reorganization whereby Timeshare Holdings acquired
TimeShareLoans.com in exchange for 29,991,000 restricted common shares of
Timeshare Holdings.
From
February 10, 2007 to April 2, 2007, we entered into subscription agreements with
the following investors for the issuance of common stock in the aggregate amount
of $7,600.00.
Last
Name
|
First
Name
|
Subscription
Date
|
Amount
in Dollars
|
|
|
|
|
|
|
Hull
|
Diane
L.
|
02/10/07
|
$100
|
|
|
|
|
|
|
Brundage
|
Richard
|
02/12/07
|
$100
|
|
|
|
|
|
|
Brinegar
|
Brian
|
02/14/07
|
$100
|
|
|
|
|
|
|
Hull
|
Bryant
|
02/14/07
|
$100
|
|
|
|
|
|
|
Hull
|
Sarah
|
02/14/07
|
$100
|
|
|
|
|
|
|
Smith
|
Brenda
|
02/15/07
|
$100
|
|
|
|
|
|
|
Conti
|
John
& Marcia
|
02/16/07
|
$100
|
|
|
|
|
|
|
Hidalgo
|
David
|
02/21/07
|
$100
|
|
|
|
|
|
|
Munley
|
Gerald
& Barbara
|
02/24/07
|
$500
|
|
|
|
|
|
|
Barton
|
Sterling
|
03/01/07
|
$100
|
|
|
|
|
|
|
Hidalgo
|
Trista
|
03/09/07
|
$100
|
|
|
|
|
|
|
Couch
|
Carol
|
03/11/07
|
$100
|
|
|
|
|
|
|
Denton
|
Autumn
|
03/11/07
|
$100
|
|
|
|
|
|
|
Moseley
|
Michael
|
03/11/07
|
$100
|
|
|
|
|
|
|
Rens
|
Douglas
|
03/11/07
|
$100
|
|
|
|
|
|
|
Yach
|
Richard
& Teresa
|
03/20/07
|
$100
|
|
|
|
|
|
|
Erickson
|
Rae
|
03/21/07
|
$200
|
|
|
|
|
|
|
Giorgione
|
Steven
& Nancy
|
03/21/07
|
$500
|
|
|
|
|
|
|
Brundage
|
Daniel
K.
|
03/22/07
|
$100
|
|
|
|
|
|
|
Brundage
|
James
M.
|
03/22/07
|
$100
|
|
|
|
|
|
|
Cook
|
Donald
|
03/22/07
|
$100
|
|
|
|
|
|
|
Guerra
|
Michael
|
3/23/2007
|
$100
|
|
|
|
|
|
|
Andrews
|
Jerome
|
03/25/07
|
$100
|
|
|
|
|
|
Bland
|
Robert
& Katherine
|
03/27/07
|
$1000
|
|
|
|
|
Casamento
|
Laura
|
3/29/2007
|
$100
|
|
|
|
|
St.
Clair
|
Cory
|
04/13/07
|
$500
|
|
|
|
|
On May
18, 2007 The Company entered into a subscription agreement with LEA Management
Group, LLC for the issuance of 100,000 shares of common stock, at a price of
$.50 per share in the amount of $50,000.
All of
the above offerings and sales were deemed to be exempt under rule 506 of
Regulation D and Section 4(2) of the Securities Act of 1933, as amended. No
advertising or general solicitation was employed in offering the securities. The
offerings and sales were made to a limited number of persons, all of whom were
accredited investors, business associates of Timeshare or executive officers of
Timeshare, and transfer was restricted by Timeshare in accordance with the
requirements of the Securities Act of 1933. In addition to representations by
the above-referenced persons, we have made independent determinations that all
of the above-referenced persons were accredited or sophisticated investors, and
that they were capable of analyzing the merits and risks of their investment,
and that they understood the speculative nature of their investment.
Furthermore, all of the above-referenced persons were provided with access to
our Securities and Exchange Commission filings. Except as expressly set forth
above, the individuals and entities to whom we issued securities as indicated in
this section of the registration statement are unaffiliated with
us.
Item
27. EXHIBITS
The
following exhibits are included in this registration statement:
SEC
Ref. No.
|
Title of Document
|
|
Agreement
and Plan of Reorganization between Timeshare Holdings Inc. and
TimeShareLoans.com, dated March 9, 2007 (Incorporated by reference to Form
SB-2 (File No. 333-145409), filed with the Securities and Exchange
Commission on August 13, 2007)
|
3.1
|
Articles
of Incorporation (Incorporated by reference to Form SB-2 (File No.
333-145409), filed with the Securities and Exchange Commission on August
13, 2007)
|
|
By-laws
(Incorporated by reference to Form SB-2 (File No. 333-145409), filed with
the Securities and Exchange Commission on August 13,
2007)
|
5.1
|
Legal
Opinion included in Exhibit 23.1
|
|
Service
Agreement entered into with LEA Management Group, date December 6, 2006
(Incorporated by reference to Form SB-2 (File No. 333-145409), filed with
the Securities and Exchange Commission on August 13,
2007)
|
10.2
|
Service
Agreement entered into with National Mortgage Lending Inc., dated February
1, 2006 (Incorporated by reference to Form SB-2 (File No. 333-145409),
filed with the Securities and Exchange Commission on August 13,
2007)
|
|
Subscription
Agreements (Incorporated by reference to Form SB-2 (File No. 333-145409),
filed with the Securities and Exchange Commission on August 13,
2007)
|
10.5
|
Escrow
Agreement to be filed by amendment
|
|
Waiver
Agreement, dated July 20, 2007 (Incorporated by reference to Form SB-2
(File No. 333-145409), filed with the Securities and Exchange Commission
on August 13, 2007)
|
14.1
|
Code
of Ethics (Incorporated by reference to Form SB-2 (File No. 333-145409),
filed with the Securities and Exchange Commission on August 13,
2007)
|
|
List
of Subsidiaries of the Company (Incorporated by reference to Form SB-2
(File No. 333-145409), filed with the Securities and Exchange Commission
on August 13, 2007)
|
23.1
|
Consent
of Sichenzia Ross Friedman Ference LLP (Attached
hereto)
|
|
Consent
of Chisholm Bierwolf & Nielsen (Attached
hereto)
|
ITEM
28. UNDERTAKINGS
The
undersigned registrant hereby undertakes to:
(1) File,
during any period in which offers or sales are being made, a post-effective
amendment to this registration statement to:
(i)
Include any prospectus required by Section 10(a)(3) of the Securities Act of
1933, as amended (the "Securities Act");
(ii)
Reflect in the prospectus any facts or events which, individually or together,
represent a fundamental change in the information in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of the securities offered would not exceed
that which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of a prospectus
filed with the Commission pursuant to Rule 424(b) under the Securities Act if,
in the aggregate, the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement,
and
(iii)
Include any additional or changed material information on the plan of
distribution.
(2) For
determining liability under the Securities Act, treat each post-effective
amendment as a new registration statement of the securities offered, and the
offering of the securities at that time to be the initial bona fide
offering.
(3) File
a post-effective amendment to remove from registration any of the securities
that remain unsold at the end of the offering.
(4) For
determining liability of the undersigned small business issuer under the
Securities Act to any purchaser in the initial distribution of the securities,
the undersigned undertakes that in a primary offering of securities of the
undersigned small business issuer pursuant to this registration statement,
regardless of the underwriting method used to sell the securities to the
purchaser, if the securities are offered or sold to such purchaser by means of
any of the following communications, the undersigned small business issuer will
be a seller to the purchaser and will be considered to offer or sell such
securities to such purchaser:
(i) Any
preliminary prospectus or prospectus of the undersigned small business issuer
relating to the offering required to be filed pursuant to Rule 424;
(ii) Any
free writing prospectus relating to the offering prepared by or on behalf of the
undersigned small business issuer or used or referred to by the undersigned
small business issuer;
(iii) The
portion of any other free writing prospectus relating to the offering containing
material information about the undersigned small business issuer or its
securities provided by or on behalf of the undersigned small business issuer;
and
(iv) Any
other communication that is an offer in the offering made by the undersigned
small business issuer to the purchaser.
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
In the
event that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
SIGNATURES
In
accordance with the requirements of the Securities Act of 1933, Timeshare
Holdings, Inc. certifies that it has reasonable ground to believe that it meets
all of the requirements of filing on Form S-1, as amended, and authorizes this
Post-Effective Registration Statement to be signed on its behalf, in the City of
Irvine, State of California, on May 30, 2008
|
TIMESHARE
HOLDINGS, INC.
|
|
|
|
|
|
|
By:
|
/s/ Paul
Kenneth Thompson
|
|
|
|
Paul
Kenneth Thompson
|
|
|
|
Chief
Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Frederick
Henry Conte
|
|
|
|
Frederick
Henry Conte
|
|
|
|
President
and Chief Financial Officer
|
|
|
|
|
|
Pursuant
to the requirements of the Securities Act of 1933, this registration statement
or amendment has been signed below by the following persons in the capacities
and on the dates indicated.
|
|
|
|
|
|
|
Date: May 30
2008
|
By:
|
/s/ Paul
Kenneth Thompson
|
|
|
|
Paul
Kenneth Thompson
|
|
|
|
Director
|
|
|
|
|
|
|
|
|
|
|
|
|
Date: May 30
2008
|
By:
|
/s/ Frederick
Henry Conte
|
|
|
|
Frederick
Henry Conte
|
|
|
|
Director
|
|
|
|
|
|
|
|
|
|
|
|
|
Date: May 30
2008
|
By:
|
/s/ Lynn
Denton
|
|
|
|
Lynn
Denton
|
|
|
|
Director
|
|
|
|
|
|
II-6
TransGlobal Assets (PK) (USOTC:TMSH)
Historical Stock Chart
From Sep 2024 to Oct 2024
TransGlobal Assets (PK) (USOTC:TMSH)
Historical Stock Chart
From Oct 2023 to Oct 2024