Generation Hemp, Inc. - FORM 10-Q

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EX-32.1 - EXHIBIT 32.1 - Generation Hemp, Inc.	ex32.htm
EX-31.1 - EXHIBIT 31.1 - Generation Hemp, Inc.	ex31.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended: June 30, 2013

Commission File Number 333-176154

HOME TREASURE FINDERS, INC. AND SUBSIDIARY

(Exact name of registrant as specified in its charter)

COLORADO	26-3119496
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

3412 West 62nd Avenue, Denver, Colorado	80221
(Address of principal executive offices)	(Zip code)

(720) 273-2398

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report.)

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes þ NO o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12(b) of the Exchange Act.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller Reporting Company þ

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

As of August 5, 2013, 11,725,800 shares of common stock, no par value of registrant were outstanding.

	Page
PART I FINANCIAL INFORMATION
Item 1. Financial Statements for the period ended June 30, 2013
Consolidated Balance Sheets (Unaudited)	3
Consolidated Statements of Operations (Unaudited)	4
Consolidated Statements of Changes in Shareholders’ Equity (Deficit) (Unaudited)	5
Consolidated Statements of Cash Flows (Unaudited)	6
Notes to Consolidated Financial Statements	7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	8
Item 3. Quantitative and Qualitative Disclosures About Market Risk	9
Item 4. Controls and Procedures	9
Item 4T. Controls and Procedures	9

PART II OTHER INFORMATION

Item 1. Legal Proceedings	10
Item 1A. Risk Factors	10
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 3. Defaults Upon Senior Securities	19
Item 4. Submission of Matters to a Vote of Security Holders	19
Item 5. Other Information	19
Item 6. Exhibits	19

Signatures	20

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

HOME TREASURER FINDERS, INC. AND SUBSIDIARY

Consolidated Balance Sheets


	June 30,			December 31,
	2013			2012
	(Unaudited)
Assets

Current Assets:
Cash	$	5,773		$	9,408
Prepaid asset		140		$	280

Total current assets	$	5,913		$	9,688
Liabilities and Shareholders’ Equity (Deficit)

Liabilities:
Accounts payable	$	15,637		$	15,959
Accrued salary		19,312			22,500
Accrued liabilities		12,316			1,686
Accrued interest on related party note payable		1,034			937
Related party note payable		2,443			4,943
Total current liabilities		50,742			46,025

Shareholders’ equity (deficit):
Common stock, no par value; 100,000,000 shares authorized,
11,725,800 shares issued and outstanding, respectively		57,302			57,302
Additional paid in capital		96,476			96,476
Deficit accumulated during development stage		(198,607	)		(190,115	)
Total shareholder’s equity (deficit)		(44,829	)		(36,337	)

Total liabilities and shareholders' equity (deficit)	$	5,913		$	9,688

See accompanying notes to consolidated financial statements.

HOME TREASURER FINDERS, INC. AND SUBSIDIARY

Consolidated Statements of Operations

(Unaudited)

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012

Commission income	$	15,593		$	—		$	52,040		$	—-
Property management income		9,748			—-			9,748			—-
Revenue	$	25,341		$	—		$	61,788		$	—


Operating expenses:
Commision expense		2,339			—-			7,806			—
Professional fees		2,937			3,130			12,215			8,100
General and Administrative		30,324			10,967			50,162			21,435
Total operating expenses		35,600			14,097			70,183			29,535


Operating loss		(10,259	)		(14,097	)		(8,395	)		(29,535	)

Other expense
Interest expense		(49	)		(401	)		(97	)		(635	)

Total other expense		(49	)		(401	)		(97	)		(635	)

Net loss	$	(10,308	)	$	(14,498	)	$	(8,492	)	$	(30,170	)


Basic and diluted loss per share	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)

Basic and diluted weighted average
common shares outstanding		11,725,800			11,425,800			11,725,800			11,425,800

See accompanying notes to consolidated financial statements.

HOME TREASURE FINDERS, INC. AND SUBSIDIARY

Consolidated Statements of Changes in Shareholders' Equity (Deficit)

					Additional
	Common Stock				Paid In		Accumulated			Total
	Shares		Amount		Capital		Deficit			Equity


Balance at December 31, 2011		11,425,800	$	27,302	$	96,476	$	(144,305	)	$	(20,527	)

Common stock issued on July 1, 2012 for cash at
$0.10 per share		300,000		30,000		—		—			30,000

Net loss for the year ended December 31, 2012		—		—		—		(45,810	)		(45,810	)

Balance at December 31, 2012		11,725,800		57,302		96,476		(190,115	)		(36,337	)

Net loss for the six months ended June 30, 2013
(Unaudited)		—		—		—		(8,492	)		(8,492	)

Balance at June 30, 2013 (Unaudited)		11,725,800	$	57,302	$	96,476	$	(198,607	)	$	(44,829	)

See accompanying notes to consolidated financial statements.

HOME TREASURER FINDERS, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows

(Unaudited)

	For the Six Months Ended
	June 30,
	2013			2012
Cash flows from operating activities:
Net loss	$	(8,492	)	$	(30,170	)
Adjustments to reconcile net loss to net cash
used by operating activities:
Changes in operating assets and liabilities:
Decrease in prepaid expense		140			—
Decrease in accrued salary		(3,188	)		—
Increase in accrued interest		97			635
Increase in accrued liabilities		10,360			17,100
Increase (decrease) in accounts payable		(322	)		2,909
Net cash used in
operating activities		(1,135	)		(9,526	)

Cash flows from investing activities:		—			—

Cash flows from financing activities:
Proceeds from common stock subscription		—			30,000
Payment of related party payable		(2,500	)		10,000
Net cash provided by
financing activities		(2,500	)		40,000

Net change in cash		(3,635	)		30,474

Cash, beginning of period		9,408			106

Cash, end of period	$	5,773		$	30,580

Supplemental disclosure of cash flow information:
Cash paid during the period for:
Income taxes	$	—		$	—
Interest	$	—		$	—

NON CASH FINANCING ACTIVITIES:

See accompanying notes to consolidated financial statements.

HOME TREASURE FINDERS, INC. AND SUBSIDIARY

Notes to Unaudited Consolidated Financial Statements

Note 1: Basis of Presentation

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

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the December 31, 2012 financial statements and notes thereto included. The results of operations for the period ended June 30, 2013, are not necessarily indicative of the operating results for the year ended December 31, 2013.

Note 2: Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements, since inception the Company has incurred losses in all quarters except the quarter ended March 31, 2013 and it has a limited operating history. These factors, among others, may indicate that the Company will be unable to continue as a going concern for a reasonable period of time.

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

Note 3: Related Party Transactions

During the six months ended June 30, 2013, $2,500 was paid to reduce our related party payable. The balance of the related party payable was $2,443 and $4,943 as of June 30, 2013 and December 31, 2012, respectively. This payable is due on demand and has an interest rate of 8%. Accrued interest on this payable was $1,034 at June 30, 2013. Beginning in 2012, the Company began accruing salary of $2,500 per month to the CEO for his services. Effective April 1, 2013, the base salary to be paid to the CEO increased to $5,500 per month. The balance accrued at June 30, 2013 was $19,312.

Effective April 1, 2013 all property management activities, revenues and expenses in connection with CW Properties, a property management company owned by the CEO, were transferred to a wholly owned subsidiary of Home Treasure Finders, Inc. All net revenue earned by CW Properties beginning April 1 has been booked as consolidated revenue of Home Treasure Finders, Inc.

Note 4: Subsequent Events

The Company has evaluated subsequent events pursuant to ASC Topic 855 and has determined that there are no events that require disclosure as of the date of issuance.

Part I. Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations

Forward-looking statements

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

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

Financial Condition and Results of Operation

Home Treasure Finders, Inc. was formed on July 28, 2008. The founder, sole director and officer of our company is Corey Wiegand.

During the three months ended June 30, 2013 we generated operating revenue from two sources, sales commission and property management. During the three months ended June 30, 2012 we did not generate any revenue because Home Treasure Finders did not have a real estate licence in the prior year period. For the three months ended June 30, 2013 the Company generated a total of $25,341 in revenues, consisting of $15,593 from sales commissions and $9,748 from property management. During the three months ending June 30, 2103 we incurred operating expenses totaling $35,600. Such expenses consisted primarily of commissions paid on the revenue earned and general and administrative and professional fees. During the three months ended June 30, 2012 we incurred a total of 14,097 of operating expenses consisting of $10,967 in General and Administrative expenses and $3,130 of Professional Fees. Our net loss decreased by $4,190 to $10,308 from $14,498 for the three month period ended June 30, 2013 compared with the prior year three month period ended June 30, 2012. This was primarily attributed to an increase in revenue earned in the current year.

Our New Property Management Subsidiary

We began to manage certain rental real estate owned by non-related third parties, effective April 1, 2013. The 55 management agreements in connection with the properties we now manage were contributed by or CEO, Corey Wiegand.

The Six Months Ended June 30, 2013 and June 30, 2012

During the Six months ended June 30, 2013 we generated operating revenue from two sources, sales commission and the net proceeds generated from property management activities. During the six months ended June 30, 2012 we did not generate any revenue because Home Treasure Finders did not have a real estate licence in the prior year period. For the six months ended June 30, 2013 the Company generated a total of $61,788 in revenues, of which $52,040 was from sales commissions and $9,748 from Property management. We incurred operating expenses totaling $70,183 for the six months ended June 30, 2013. Such expenses consisted primarily of commissions paid on the revenue earned, general and administrative and professional fees. Beginning April 1, 2013, our General and administrative expense was higher than in previous periods, in part due to an increase from $2,500 per month to $5,500 per month in salary paid to or CEO, Corey Wiegand.

During the six months ended June 30, 2012 we incurred a total of $29,535 of operating expenses consisting of $21,435 in General and Administrative expenses and $8,100 of Professional Fees. We generated a net loss of $30,170 for this six month period ended June 30, 2012.

Our net loss decreased by $21,678 to $8,492 from $30,170 for the six month period ended June 30, 2013 compared with the prior year six month period ended June 30, 2012. This was primarily attributed to an increase in revenue earned in the current year.

Liquidity and Capital Resources

At June 30, 2013, we had $5,773 in cash and a working capital deficit of $30,580. At June 30, 2012 we had $20,697 in cash and a working capital deficit of $36,337. During the periods ended March 31, 2013 and June 30, 2013 our liquidity and capital resources declined and as of the date of this report remain week. However, in comparison to the similar periods in the prior year, and as of the date of this report, our abilities to generate the revenue stream described in our business plan and from our new operations in property management are improving.

Our Web Site Supporting Real Estate Operations

We operate a web site as a key aspect of our real estate sales and property management business. The address of our website is: www.hometreasurefinder.com.

We are planning to augment our website to support three planned activities:

1.	Recruiting and training buyer agents
2.	Forming contracts with listing agents
3.	Real Estate Investment Mentoring

Item 3. Quantitative and Qualitative Disclosures About Market Risk

No response required.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

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

Item 4T. Changes in Internal Controls over Financial Reporting

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

Part 2. Other Information

Item 1 - Legal Information.

No response required.

Item 1A. Risk Factors

This investment has a high degree of risk. Before you invest you should carefully consider the risks and uncertainties described below. If any of the following risks actually occur, our business, operating results and financial condition could be harmed and the value of our stock could go down. This means you could lose all or a part of your investment.

Our Auditor’s report states that there is substantial doubt that we will be able to continue as a going concern.

We have had substantial losses since inception and minimal cash reserves. While we are beginning to earn revenue and make a profit, our ability to continue as a going concern over the long term remains unproven. In the event that we are forced to reduce operations or in any way curtail our business, an investor will lose all money invested.

We have a limited operating history.

Our ability to maintain profitability depends upon the continued service of Corey Wiegand, our founder, who has to date been our sole source of commission revenue. During the last six months our revenues have accelerated and we are no longer considered a development stage company. As shown in our financial statements, we had a net loss of $8,492 in the current quarter. We may also incur significant operating losses in the future, primarily due to the expansion of our operations. Our business plan provides that we will grow rapidly and ultimately deliver professional services to would be buyers through “buyer agents” rather than primarily through our founder. To actualize this goal, we plan to market our advanced sales techniques to established realtors that wish to earn more commissions from buyer transactions. We are working to recruit buyer agents to sign our master referral agreements, graduate from our workshops and respond to our IVR leads. As of the date of this report, we are training one buyer agent and are negotiating to lease office space where we plan to aggressively expand our professional staff.

We are no longer considered a development stage company. As shown in our financial statements, we earned a net income of $1,816 in the current quarter. However, we may incur significant operating losses in the future, primarily due to the expansion of our operations. Our business plan provides that we will grow rapidly and ultimately deliver professional services to would be buyers through “buyer agents” rather than primarily through our founder. To actualize this goal, we plan to market our advanced sales techniques to established realtors that wish to earn more commissions from buyer transactions. We are working to actualize our plan to recruit buyer agents to sign our master referral agreements, graduate from our workshops and respond to our IVR leads. As of the date of this report, we are training two buyer agents.

Our company is new and has only recently commenced planned operations. We may not be able to generate predictable and continuous revenue in the near future. Further, there is no assurance that we will ever grow operations outside the Denver Metro area. Failure to generate sufficient revenue to pay expenses as they come due may make us unable to continue as a going concern and result in the failure of our company and the complete loss of any money invested to purchase our shares.

We may be unable to manage our growth or implement our expansion strategy.

We have recent taken over the operations of CW Properties which manages 55 rental units and which has in the past shown net revenue from management fees. Therefore, in the future we will need to undertake additional activites in property management as well as those in connection with our ongoing business plan.

As a public company, our expenses include, but are not limited to, annual audits, legal costs, SEC reporting costs, costs of a transfer agent and the costs associated with fees and compliance. Further, our management will need to invest significant time and energy to stay current with the public company responsibilities of our business and will therefore have diminished time available to apply to other tasks necessary to our survival. It is therefore possible that the financial and time burdens of operating as a public company will cause us to fail to achieve profitability. If we exhaust our funds, our business will fail and our investors will lose all money invested in our stock.

It is essential that we grow our business, achieve profits and maintain adequate cash flow to pay the cost of remaining public. If we fail to pay public company costs, as such costs are incurred, we could become delinquent in our reporting obligations.

The issuance of additional shares of our common stock may be necessary for the implementation of our growth strategy.

We have no present plan to issue additional common stock or undertake additional financing. However, the issuance by us of any additional securities pursuant to any future fundraising activities undertaken by us would dilute the ownership of existing shareholders and may reduce the price of our common stock. Furthermore, debt financing, if available, will require payment of interest and may involve restrictive covenants that could impose limitations on our operating flexibility. Our failure to successfully obtain additional funding may jeopardize our ability to continue our business and operations.

The loss of our current executive officer or key management personnel or inability to attract and retain the necessary personnel could have a material adverse effect upon our business, financial condition or results of operations

Our success is heavily dependent on the continued active participation of our current executive officer and sole director listed under “Management.” Loss of the services of our officer could have a material adverse effect upon our business, financial condition or results of operations. Further, our success and achievement of our growth plans depend on our ability to recruit, hire, train and retain other highly qualified technical, professional, clerical, administrative and managerial personnel. Competition for qualified buyer agents among companies in the real estate industry is intense, and the loss of any of such persons, or an inability to attract, retain and motivate any additional highly skilled realtors required for the expansion of our activities, could have a materially adverse effect on us. The inability on our part to attract and retain the necessary personnel, consultants and advisors could have a material adverse effect on our business, financial condition or results of operations.

We are controlled by our current officer and director.

Our sole director, who is our sole executive officer, beneficially owns approximately 57.1% of our outstanding shares of Common Stock. Accordingly, our executive officer and director will have the ability to control the election of our Board of Directors and the outcome of issues submitted to our stockholders.

Since we have only one director who serves as our president, chief executive officer, chief financial officer and secretary, decisions which affect the company will be made by only one individual. It is likely that conflicts of interest will arise in the day-to- day operations of our business. Such conflicts, if not properly resolved, could have a material negative impact on our business.

In the past, the Company has issued shares for cash and services at prices which were solely determined by Corey Wiegand. At that time, Mr. Wiegand made a determination of both the value of services exchanged for our shares, and, as well, the price per share used as compensation. Transactions of this nature were not made at arm’s length and were made without input from a knowledgeable and non-interested third party. Future transactions of a like nature could dilute the percentage ownership of the company owned by a given investor. While the company believes its past transactions were appropriate, and plans to act in good faith in the future, an investor in our shares will have no ability to alter such transactions as the may occur in the future and, further, will not be consulted by the company in advance of any such transactions. An investor who is unwilling to endure such potential dilution should not purchase our shares.

Recently, Mr. Wiegand contributed the property management entity known as CW Properties.

We have limited financial resources to take advantage of advertising opportunities as they may arise.

The inability to pay for signs, telephone services and web-based advertisements on established websites would adversely affect our ability to generate sufficient buyer leads and meet future realtor demand for referrals and could impair our ability to enter this market.

Our operating results will be subject to fluctuations and our stock price may decline significantly.

Our quarterly revenue and operating results from Commissions will be difficult to predict from quarter to quarter. We derive relatively stable revenue from our property management operations. Nonetheless, it is possible that our net operating results in some quarters will fall below our expectations. Our quarterly operating results will be affected by a number of factors, including:

	•		trends in the median home values in Colorado;
	•		the availability, pricing and timeliness of web advertising campaigns;
	•		the impact of seasonal variations in demand and/or revenue recognition linked to construction cycles and weather conditions and the retail price of signs, sign riders, telephone services, and Mentor Sales Workshops;
	•		timing, availability and changes in government incentive programs;
	•		unplanned additional expenses;
	•		logistical costs;
	•		unpredictable volume and timing of buyer’s agent sales;
	•		our ability to establish and expand listing agent relationships;
	•		the number of buyer agents that we are able to recruit, the ability to book facilities for planned sales training seminars;
	•		the timing of new technology announcements or introductions by our competitors and other developments in the competitive environment;
	•		increases or decreases in real estate appreciation rates due to changes in economic growth;
	•		travel costs and other factors causing the mentor training business to become more difficult; and
	•		changes in lending, inspection, appraisal and other factors that result in closing delays or cancellations.

If revenue for a particular quarter is lower than we expect, we likely will be unable to proportionately reduce our operating expenses for that quarter, which would harm our operating results for that quarter. If we fail to meet investor expectations or our own future guidance, even by a small amount, our stock price could decline, perhaps substantially.

Existing real estate laws, regulations and policies and changes to these regulations and policies may present technical, regulatory and economic barriers to potential buyers and consequently to the real estate referral business which may significantly reduce demand for our services.

The market for homes is influenced by U.S. federal, state and local government regulations and policies concerning the real estate industry, as well as policies promulgated by local real estate boards. These regulations and policies often relate to realtor compensation, and pricing. In the U.S. and in a number of other countries, these regulations and policies are being modified and may continue to be modified. Investment in the real estate, could be deterred by these regulations and policies, which could result in a significant reduction in the potential demand for our services. For example, loss of favorable tax treatment, certain government buyer incentive programs, and or government subsidized or backed loan programs may result in loss of sales which would likely harm our financial performance.

We anticipate that our mentor services and their perceived customer value will be subject to oversight and regulation in accordance with national and local ordinances relating to real estate sales laws. Any new government regulations could cause a significant reduction in demand for our mentor services.

The reduction or elimination of government and economic incentives could cause our revenue to decline.

Today, we believe consumer confidence is slowly recovering. However buyers are finding it very difficult to qualify for loans. As a result, federal, state and local government bodies in many states have provided incentives in the form of rebates, tax credits and other incentives to buyers that are willing to purchase real estate. For example, an eight thousand dollar first time home buyer tax credit was offered and thereafter the credit offering expired. Future government economic incentives, if any, could be reduced or eliminated altogether. Such home buyer incentives expire, decline over time, are limited in total funding or require renewal of authority. Reductions in, or eliminations or expirations of, governmental incentives could result in decreased demand for our services.

Changes in tax laws or fiscal policies may decrease the return on investment for customers of our business which could decrease demand for our services and harm our business.

We anticipate that a portion of our future revenues will be derived from commissions in connection with the sale of single family residences to individual homebuyers. In deciding whether to purchase or to rent, prospective customers may evaluate their projected return on investment. Such projections are based on current and proposed federal, state and local laws, particularly tax legislation. Changes to these laws, including amendments to existing tax laws or the introduction of new tax laws, tax court rulings as well as changes in administrative guidelines, ordinances and similar rules and regulations could result in different tax assessments and may adversely affect a homeowner’s projected return on investment, which could have a material adverse effect on our business and results of operations.

Problems with service quality or individual buyer agent performance may include agent error, agent negligence or problems within the mentoring services we plan to provide. The result would likely be fewer customers, reduced revenue, unexpected expenses and loss of market share.

In the future, should we become significantly reliant on abilities and skills of other agents at arm’s length, we may fall victim to unexpected agent errors or omissions. If we deliver mentor services provided by third party agents our credibility and the market acceptance of our mentor services could be harmed.

The realtors we plan to recruit may not deliver consistent and professional mentor and “buyer agent” services and thus our business plan may not gain market acceptance, which would prevent us from achieving sales and market share

The development of a successful market for the mentor services we intend to deliver may be adversely affected by a number of factors, some of which are beyond our control, including:

●	our failure to offer mentoring services that compete favorably against other services on the basis of cost, quality and performance;

●	our failure to offer mentoring services that compete favorably against conventional sales agents and realtors and alternative lead-generation technologies, such as text and e-mail spamming on the basis of cost, quality and performance.

If the services we intend to offer fail to gain market acceptance, we will be unable to achieve significant sales and market share.

If refinements in phone or web technology cause the services we intend to deliver to become uncompetitive or obsolete that could prevent us from achieving market share and sales. The real estate industry is rapidly evolving and highly competitive. A variety of competing lead generation technologies may be under development or available now that could result in lower buyer agent costs or higher conversion rates than those lead generation technologies selected by us. These development efforts may render obsolete the lead generation services we have selected to offer.

Existing telephone and web advertising regulations and changes to such regulations may present regulatory and economic barriers to the purchase of real estate lead generation services, which may significantly reduce demand for our services.

The market for lead generation services is heavily influenced by federal, state and local government regulations and policies concerning the tech based marketing industry, as well as internal policies and regulations promulgated by “national do not call lists.” These regulations and policies often relate to public privacy. In the United States these regulations and policies are being modified and may continue to be modified. We anticipate that our lead generation channels will be subject to oversight and regulation in accordance with national and local ordinances relating to privacy protection, and related matters. Any new government regulations or utility policies pertaining to our lead generation services may result in significant additional expenses to us and as a result, could cause a significant reduction in sales referrals.

If our mentoring services are not suitable for widespread adoption, or a sufficient demand for trained buyer agents or leads does not develop, or takes longer to develop than we anticipate, we would be unable to achieve sales.

The market for residential real estate is rapidly evolving and its future is uncertain. If real estate proves unsuitable for widespread ownership or if demand for our mentoring services fails to develop sufficiently, we would be unable to achieve sales and market share. In addition, demand for real estate mentoring in the markets and geographic regions we target may not develop or may develop more slowly than we anticipate. Many factors will influence the widespread adoption of real estate mentoring including:

•	cost-effectiveness of hiring a mentor as compared with establishing a conventional buyer agency agreement;
•	performance and reliability of trained mentors as compared with conventional and established buyer agents;
•	success of alternative lead generation technologies such as web-casts, text messaging, email spamming;
•	fluctuations in economic and market conditions that impact the viability of real estate purchases;
•	increases or decreases in the costs associated with obtaining a residential home loan;
•	capital expenditures by customers, which tend to decrease when the domestic or foreign economies slow;
•	continued regulation of the real estate and lending industries; and
•	availability and effectiveness of government subsidies and incentives.

The reduction in home loan availability could prevent us from achieving sales and market share.

The reduction or elimination of government lending incentives may adversely affect the growth of this market or result in increased price competition, which could prevent us from achieving sales and market share.

Today, over 70% of home loans are insured by the federal housing administration (FHA loans). These loans are popular because they have lower down payment requirements and lower credit score requirements. Should FHA raise their down payment or credit requirements the result could be reduced home purchases which would significantly harm our business.

We face intense competition from other real estate brokerages and other real estate mentoring companies. If we fail to compete effectively, we may be unable to increase our market share and sales.

Most of our competitors are substantially larger than we are, have longer operating histories and have substantially greater financial, technical, marketing and other resources than we do. Our competitors' greater sizes in some cases provides them with competitive advantages with respect to marketing costs due to their ability to allocate fixed costs across a greater volume of marketing channels and purchase signs and services at lower prices. They also have far greater name recognition, an established network of past customers. In addition, many of our competitors have well-established relationships with current and potential home sellers. As a result, our competitors will be able to devote greater resources to the prospecting, relationship development, and promotion and may be able to respond more quickly to evolving industry standards and changing customer requirements than we can.

A substantial number of our issued shares are, or are being made available for sale on the open market. The resale of these securities might adversely affect our stock price.

The sale of a substantial number of shares of our common stock, or the market's anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales.

Availability of these shares for sale in the public market could also impair our ability to raise capital by selling equity securities.

Since there is presently no trading market for our shares, an investment in our shares is totally illiquid. An investor purchasing our shares will not be able to resell their shares unless a market for our shares develops at some point in the future. There can be no assurance that such a market will ever develop. Therefore, investors who purchase our shares could lose their entire investment.

Even if a market for our shares does develop at a future date, the volume of trading will be small and on many days the volume will be zero. Our share price will likely be volatile and will likely fall rapidly should an investor attempt to liquidate even as small number of shares. These conditions are likely to persist and could prevent resale of our shares.

We are subject to corporate governance and internal control reporting requirements, and our costs related to compliance with, or our failure to comply with existing and future requirements, could adversely affect our business.

We face new corporate governance requirements under the Sarbanes-Oxley Act of 2002, as well as new rules and regulations subsequently adopted by the SEC and the Public Company Accounting Oversight Board. These laws, rules and regulations continue to evolve and may become increasingly stringent in the future. In particular, under new SEC rules we will be required to include management's report on internal controls as part of our annual report pursuant to Section 404 of the Sarbanes-Oxley Act. Furthermore, under the proposed rules, an attestation report on our internal controls from our independent registered public accounting firm will be required as part of our annual report. We are in the process of evaluating our control structure to help ensure that we will be able to comply with Section 404 of the Sarbanes-Oxley Act. The financial cost of compliance with these laws, rules and regulations is expected to be substantial. We cannot assure you that we will be able to fully comply with these laws, rules and regulations that address corporate governance, internal control reporting and similar matters. Failure to comply with these laws, rules and regulations could materially adversely affect our reputation, financial condition and the value of our securities.

Because 93% of residential listings are held by just 7% of listing agents, our business will become extremely dependent on a very limited number of listing agents. In the event that we enter relationships with the most productive listing agents and placed our signs at their respective inventories, we could ultimately become dependent on them. If any of these relationships is not maintained, or if the listing agent duplicates our service this could prevent us from delivering our services to our customers within required timeframes, which could result in loss of market share.

If we fail to develop or maintain our relationships with powerful listing agents, or sign management companies, we may be unable to put our IVR signs at their listings and as a result we may not receive an adequate number of buyer and seller inquiries. Our services may not be marketed effectively and this could prevent us from delivering our services to our customers within required timeframes and we may experience lower sales conversion rates and loss of market share. The failure of a listing agent to supply us with updated listing inventory lists in a timely manner, or failure of a sign management company to post our signs quickly and inexpensively, could impair our ability to prospect effectively and increase our costs. If the buyer agent to whom we refer business is unable to respond to customer inquiries on a timely basis, we could be prevented from delivering our services to our customers within required timeframes, which could result in lower sales conversion rates, a higher number of contract terminations and loss of market share, any of which could have a material adverse effect on our business and results of operations.

Because the markets in which we compete are highly competitive and many of our competitors have greater resources, we may not be able to compete successfully and we may lose, or be unable to gain, market share.

We expect to face increased competition in the future. Further, many of our competitors are developing and are currently producing sales prospecting tools based on new web technologies that may ultimately have costs similar to, or lower than, our projected costs.

Our mentoring services compete against other buyer agent sources including, Realtor.com’s “buyer assist”, and cohomefinder.com. In the large-scale real estate sales market, we will face direct competition from a number of real estate companies that provide sales services. Our website, www.hometreasurefinder.com will attempt to compete with these more established internet resources. Other potential competitors in the real estate market include real estate brokerages, realtors and individual real estate agents. We also expect that future competition will include new entrants to the real estate market offering new technological solutions. As we enter new markets and pursue additional applications for our services, we expect to face increased competition, which may result in price reductions, reduced margins or loss of market share.

Competition is intense, and many of our competitors have significantly greater access to financial, technical, manufacturing, marketing, management and other resources than we do. Many also have greater name recognition, a more established network and a larger base of customers. In addition, many of our competitors have well-established relationships with our potential sign suppliers, and sign management companies and have extensive knowledge of our target markets. As a result, these competitors may be able to devote greater resources to the promotion and sale of their listings and respond more quickly to evolving industry standards and changing customer requirements.

We believe that the key competitive factors in the market for real estate leads include:

· Lead cost;

· Lead conversion rate

We believe that certain buyer agents may have existing relationships with certain established listing agents. We also believe that certain listing agents may already have great working relationships with certain individual buyer agents. We will likely not be able to convince these listing agents to drop the buyer's agents that they already have and outsource their leads to us.

However, we believe some listing agents do not presently have an adequate buyer agent arrangement. Consequently, we plan concentrate our efforts to form listing agent relationships where our efforts will most likely meet with success.

We may also face competition from groups we have not yet identified who may develop services or technologies which are competitive with our services. Consolidation or strategic alliances among such competitors may strengthen these advantages and may provide them greater access to customers or new technologies. If government funding for down payments and home buying and development grants, customer tax rebates and other programs that promote real estate investment are available to our clients, we plan to assist our clients in pursuit of such funds.

If we cannot continue to compete successfully in the real estate industry, our operating results and financial condition will be adversely affected. Furthermore, we expect competition in the targeted markets to increase, which could result in lower sales conversion rates or reduced demand for our service offerings and may have a material adverse effect on our business and results of operations.

Demand for our mentoring services is affected by general economic conditions.

The United States and international economies have recently experienced a period of reduced economic growth. A sustained economic recovery is uncertain. In particular, terrorist acts and similar events, continued turmoil in the Middle East or war in general could contribute to a slowdown of the market demand for real estate investments that require significant initial capital expenditures, including demand for fix and flips, rental properties, and new residential and commercial buildings. In addition, increases in interest rates may increase financing costs to customers, which in turn may decrease demand for real estate investment. If the economic recovery slows as a result of the recent economic, political and social turmoil, or if there are further terrorist attacks in the United States or elsewhere, we may experience decreases in the demand for our mentoring services, which may harm our operating results.

Compliance with real estate law and local regulations can be expensive, and non-compliance with these regulations may result in adverse publicity and potentially significant monetary damages and fines for us

Our present and planned operations do not involve any irregular activities. Nonetheless, we are required to comply with all foreign, U.S. federal, state and local laws and regulations regarding licensing and insurance requirements. In addition, under some statutes and regulations, a government agency, or other parties, may seek recovery and response costs from an agent where warrantees have been made, even if the agent was not responsible for such a warrantee or is otherwise at fault. In the course of future business we may inadvertently refer business to an agent who does not comply with local laws and regulations. Any failure by us to shift responsibility onto that agent, and thus restrict our liability in connection with the incident, could subject us to potentially significant monetary damages and fines or suspensions in our business operations. In addition, if more stringent laws and regulations are adopted in the future, the costs of compliance with these new laws and regulations could be substantial. If we fail to comply with present or future real estate laws and regulations we may be required to pay substantial fines, suspend, or cease operations.

There are restrictions on the transferability of the securities.

Until registered for resale, investors must bear the economic risk of an investment in the Shares for an indefinite period of time. Rule 144 promulgated under the Securities Act (“Rule 144”), which provides for an exemption from the registration requirements under the Securities Act under certain conditions, requires, among other conditions, a six month holding period prior to the resale (in limited amounts) of securities acquired in a non-public offering without having to satisfy the registration requirements under the Securities Act There can be no assurance that we will fulfill any reporting requirements in the future under the Exchange Act or disseminate to the public any current financial or other information concerning us.

If the Company uses its stock in acquisitions of other entities there may be substantial dilution at the time of a transaction.

The $0.10 per share offering price of the common stock we sold under our prospectus was arbitrarily set. The price did not bear any relationship to our assets, book value, earnings or net worth and it is not an indication of actual value. You may also suffer additional dilution in the future from the sale of additional shares of common stock or other securities or if the Company’s shares are issued to purchase other assets or to raise additional working capital.

The laws which govern merger transactions provide that since our sole director and officer owns over 50% of our outstanding shares, we may enter into a share exchange, reverse merger or other similar transaction with a private company in an unrelated business without the prior approval of unaffiliated shareholders.

The various securities laws applicable to our company provide that our management may elect to enter and consummate a transaction to enter a new or additional businesses. In that event, our shareholders would likely receive only an information statement with certain disclosures as required by law and would likely not be in a position to approve or disapprove the transaction. Investors who are unwilling to accept the uncertainty of new management, a new business plan, likely dilution and all the numerous related uncertainties that may materialize in the event such a transaction is consummated, should not purchase our shares.

There is presently no market for our common stock, Failure to develop or maintain a trading market could negatively affect the value of our shares and make it difficult or impossible for you to sell your shares.

Prior to our IPO, there has been no public market for our common stock and a public market for our common stock may not develop. We will attempt to have our common stock quoted on the Over-The-Counter Bulletin Board (OTCBB) or the OTCQB which are both dealer systems. We plan to locate one or more market-makers to provide quotations for our common stock, but it is possible that no market-maker will want to provide such quotations. Failure to develop or maintain an active trading market could negatively affect the value of our shares and make it difficult for you to sell your shares or recover any part of your investment in us. Even if a market for our common stock does develop, the market price of our common stock may be highly volatile. In addition to the uncertainties relating to our future operating performance and the profitability of our operations, factors such as variations in our interim financial results, or various, and as yet unpredictable factors, many of which are beyond our control, may have a negative effect on the market price of our common stock.

Even if our common stock is assigned a trading symbol and quoted on the OTCBB or OTCQB a limited trading market is all that we anticipate for the near future. Accordingly, there can be no assurance as to the liquidity of any markets that may develop for our common stock, the ability of holders of our common stock to sell our common stock, or the prices at which holders may be able to sell our common stock.

Our common stock will be subject to the “Penny Stock” rules of the SEC.

The Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition of a "penny stock," for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require:

·	that a broker or dealer approve a person's account for transactions in penny stocks; and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

In order to approve a person's account for transactions in penny stocks, the broker or dealer must:

obtain financial information and investment experience objectives of the person; and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the Commission relating to the penny stock market, which, in highlight form:

·	sets forth the basis on which the broker or dealer made the suitability determination; and

·	that the broker or dealer received a signed, written agreement from the investor prior to the transaction.

Generally, brokers may be less willing to execute transactions in securities subject to the "penny stock" rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock.

Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

Should our stock become quoted on the OTCBB and/or OTCQB, if we fail to remain current on our reporting requirements, we could be removed from either market which would limit the ability of broker-dealers to sell our securities and the ability of stockholders to sell their securities in the secondary market.

Companies quoted on the OTCBB or OTCQB, such as we are seeking to become, are reporting issuers under Section 12 of the Securities Exchange Act of 1934, as amended, and must be current in their reports under Section 13, in order to maintain price quotation privileges on the OTCBB or OTCQB. If we fail to remain current on our reporting requirements, we could be removed from quotation. As a result, the market liquidity for our securities could be severely adversely affected by limiting the ability of broker-dealers to sell our securities and the ability of stockholders to sell their securities in the secondary market. In addition, we may be unable to get re-listed for quotation on the OTC Bulletin Board, which may have an adverse material effect on our Company.

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

None.

Item 3 - Defaults Upon Senior Securities.

No response required.

Item 4 - Submission of Matters to a Vote of Security Holders.

No response required.

Item 5 - Other Information.

No response required.

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

(a) Exhibits:

31.1:

Certification of Principal Executive and Financial Officer

32.1:

Section 1350 Certification

101

XBRL Exhibit

(b)

Reports on Form 8-K:

None.

SIGNATURES

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

	HOME TREASURE FINDERS, INC. AND SUBSIDIARY
	(Registrant)


DATE: August 14, 2013	BY:	/s/ Corey Wiegand
		Corey Wiegand
		President

Generation Hemp, Inc. - FORM 10-Q - August 14, 2013

Attached files

Generation Hemp, Inc. Reports