MINNESOTA                                                                                                 41-0843268

TABLE OF CONTENT

PART I.            Financial Information

ITEM 1.            Unaudited Condensed Consolidated Financial Statements:

(a)    Condensed Consolidated Balance Sheets as of September 30, 2013 and June 30, 2013

(b)    Condensed Consolidated Statements of Operations for the three months ended September 30, 2013 and 2012

(c)    Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2013 and 2012  

(d)    Notes to Condensed Consolidated Financial Statements

ITEM 2.           Management's Discussion and Analysis of Financial Condition and Results of Operations

ITEM 3.           Quantitative and Qualitative Disclosures about Market Risk

ITEM 4.           Controls and Procedures

PART II.          Other Information

ITEM 1.           Legal Proceedings

ITEM 1A.        Risk Factors

ITEM 2-4.        Not Applicable

ITEM 5.           Not Applicable

ITEM 6.           Exhibits

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ASSETS	30-Sep-2013	30-Jun-2013
Current assets
Cash	$ 80,507	$ 35,796
Restricted cash	38,102	38,099
Trade accounts receivable, net	829,418	1,626,897
Inventories	2,309,483	2,862,176
Other current assets	70,012	42,370
Deferred income taxes	235,000	268,000
Current assets of discontinued operations	1,150,847	1,239,603
Total current assets	4,713,369	6,112,941
Property, plant & e quipment
Property, plant & equipment at cost	3,091,970	3,089,391
Less Accumulated depreciation	(1,885,494)	(1,860,694)
Total property, plant & equipment	1,206,476	1,228,697
Other assets
Deferred financing costs	71,769	74,329
Other	7,634	7,634
Noncurrent assets of discontinued operations	8,766,832	8,614,852
Total other assets	8,846,235	8,696,815
Total Assets	$ 14,766,080	$ 16,038,453

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LIABILITIES & STOCKHOLDERS' DEFICIT	30-Sep-2013	30-Jun-2013
Current l iabilities
Line of credit - bank	$ 803,640	$ 1,275,000
Short term notes payable - others	300,000	300,000
Trade accounts payable	693,698	864,847
Due to finance company	149,776	711,577
Accrued liabilities	868,408	719,501
Current maturities of long-term debt	974,837	315,361
Deferred revenue	-	343,350
Current liabilities of discontinued operations	1,844,135	1,925,677
Total current liabilities	5,634,494	6,455,313
Long-term liabilities
Long term debt less current portion	2,517,811	3,264,191
Non-current liabilities and non-controlling interest of discontinued operations	8,179,165	7,934,949
Total Long-term liabilities and non-controlling interest	10,696,976	11,199,140
Total liabilities	16,331,470	17,654,453
Stockholders' deficit
Common stock	143,151	143,151
Paid-in-capital	2,457,975	2,457,975
Accumulated deficit	(4,166,516)	(4,217,126)
Total stockholders' deficit	(1,565,390)	(1,616,000)
Total liabilities and stockholders' deficit	$ 14,766,080	$ 16,038,453

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	Three Months Ended
	30-Sep-2013	30-Sep-2012
		(Restated)
Net revenue	$ 1,557,501	$ 3,182,782
Operating expenses
Cost of sales	1,373,155	2,789,735
Sales & marketing	21,399	27,950
General & administrative	145,862	167,326
Total operating expenses	1,540,416	2,985,011
Operating income	17,085	197,771
Other expenses
Interest income	3	45
Interest expense	(74,717)	(116,036)
Loss on extinguishment of debt	-	(224,000)
Total other expenses	(74,714)	(339,991)
Net loss from continuing operations before income taxes	(57,629)	(142,220)
Income tax expense (benefit) -continuing operation	(23,000)	31,000
Net loss from continuing operations	(34,629)	(173,220)
Discontinued operations:
Net Income from discontinued operation before taxes	141,239	109,125
Income tax expense -discontinued operation	56,000	44,000
Net Income from discontinued operation	85,239	65,125
Net income (loss)	$ 50,610	$ (108,095)
Basic and diluted net income (loss) per share (Continu ing operations)	$ (0.02)	$ (0.12)
Basic and diluted net income (loss) per share (Discontinued operations)	$ 0.06	$ 0.04
Basic and diluted net income (loss) per share	$ 0.04	$ (0.08)
Weighted -average common shares used in the computation of EPS
Basic and diluted	1,431,503	1,431,503

ITEM 1 - FINANICAL STATEMENTS   

	Three Months Ended
	30-Sep-2013	30-Sep-2012
		(Restated)
Cash flows from operating activities:
Net income (loss)	$ 50,610	$ (108,095)
Net income from discontinued operations	85,239	65,125
Net loss from continued operations	(34,629)	(173,220)
Adjustments to reconcile net loss to
net cash flows from operating activities-continuing operations:
Depreciation and amortization	27,360	16,747
Loss on extinguishment of debt	-	224,000
Deferred income taxes	33,000	82,000
Change in receivables	797,479	(164,074)
Change in inventories	552,693	992,945
Change in prepaids & other assets	(27,642)	(15,869)
Change in accounts payable and due to finance company	(732,950)	(412,963)
Change in deferred revenue	(343,350)	(433,355)
Change in accrued liabilities	148,907	(59,365)
Net cash flows from operating activities-continuing operations	420,868	56,846
Net cash flows from operating activities-discontinued operations	77,548	145,363
Net cash flows from operating activities	498,416	202,209
Cash flows from investing activities:
Purchases of property, plant and equipment	(2,579)	(12,609)
Changes in restricted cash	(3)	48,834
Net cash flows from investing activities-continuing operations	(2,582)	36,225
Net cash flows from investing activities-discontinued operations	(219,748)	(58,317)
Net cash flows from investing activities	(222,330)	(22,092)
Cash flows from financing activities:
Increase (decrease) in line of credit	(471,360)	-
Principal payments on long-term debt	(86,904)	(62,878)
Funds received from discontinued operations	184,689	18,184
Net cash flows from financing activities-continuing operations	(373,575)	(44,694)
Net cash flows from financing activities-discontinued operations	79,566	-
Net cash flows from financing activities	(294,009)	(44,694)
Net change in cash	(17,923)	135,423
Less: Change in cash-discontinued operations	(62,634)	87,046
Net change in cash-continuing operations	44,711	48,377
Cash-continuing operations
Beginning of year	35,796	130,740
End of period	$ 80,507	$ 179,117

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ITEM 1 - FINANICAL STATEMENTS   

					Consolidated Statement of Operations
					Previously
					Reported		Adjustments		Restated
Three Months Ended September 30, 2012
Continuing Operations:
	Cost of sales				$ 2,821,573		$ (31,838)		$ 2,789,735
	Operating income				165,933		31,838		197,771
	Income (loss) before income taxes				49,942		(192,162)		(142,220)
	Provision for income taxes				20,000		11,000		31,000
	Net income (loss)				29,942		(203,162)		(173,220)
Net income (loss)					95,067		(203,162)		(108,095)
Basic income (loss) per share - continuing operations					$ 0.07		$ (0.19)		$ (0.12)
Diluted income (loss) per share - continuing operations					$ 0.01		$ (0.13)		$ (0.12)
Basic income (loss) per share					$ 0.07		$ (0.15)		$ (0.08)
Diluted income (loss) per share					$ 0.04		$ (0.12)		$ (0.08)
					Consolidated Statement of Cash Flows
					Previously
					Reported		Adjustments		Restated
Three Months Ended September 30, 2012
Continuing Operations:
	Cash flows from operating activities				$ 62,826		$ (5,980)		$ 56,846
	Cash flows from investing activities				30,245		5,980		36,225

                                                    

		Three Months Ended
		30-Sep-2013	30-Sep-2012
			(Restated)
Net loss from continuing operations		(34,629)	(173,220)
Net Income from discontinued operation		85,239	65,125
Net income (loss)		$ 50,610	$ (108,095)
Weighted -average common shares used in the computation of EPS
Basic and diluted		1,431,503	1,431,503
Basic and diluted net income (loss) per share (Continuing operations)		(0.02)	(0.12)
Basic and diluted net income (loss) per share (Discontinued operations)		0.06	0.04
Basic and diluted net income (loss) per share		0.04	(0.08)

	30-Sep-2013	30-Jun -2013
Raw Material	1,666,460	1,730,189
Work In Process	643,023	1,131,987
Inventory	2,309,483	2,862,176

	30-Sep-2013	30-Jun-2013
Note payable — bank, payable in monthly installments of $ 6,672 including interest at 6.0 %, with a balloon payment in January 2023. The note is secured by the first mortgage on property owned by Stinar, continuing commercial guarantees from both the Company and the chief executive officer/key stockholder and by the assignment of a life insurance policy on the chief executive officer/key stockholder.	$ 905,578	$ 922,151
Note payable — SBA, payable in monthly installments of $ 20,503 including interest at the prime rate (as published by the Wall Street Journal) plus 1 %, adjusted every calendar quarter ( 4.25 % at Sep 30 , 2013), maturing in May 2018. The note is secured by the assets of Stinar and the unconditional guarantee of the chief executive officer/key stockholder.	1,037,017	1,089,303
Note payable — SBA, payable in monthly installments of $ 5,107 , including interest and SBA fees for an interest rate of 4.1 %, maturing March 2033. The note is secured by a second mortgage on property owned by Stinar and an unconditional guarantee from both the Company and the chief executive officer/key stockholder.	746,281	753,876
Note payable — bank, payable in monthly installments of $ 6,091 with interest at 2.75 % over the U.S Bancorp Prime Lending Rate ( 6.0 % at Sep 30 , 2013) through February 2016. The note is secured by the assets of Stinar, the unconditional guarantee of the chief executive officer/key stockholder, and by the assignment of a life insurance policy on the chief executive officer/key stockholder.	163,772	174,222
Long-term debt before debentures	2,852,648	2,939,552
Convertible subordinated debentures — unsecured with 9 % interest due quarterly, convertible into one common share for each $ 0.40 of principal, maturing on July 1, 2014. The debentures are issued to shareholders/officers of the Company ($ 560,000 ) and an outside investor ($ 80,000 ).	640,000	640,000
Subtotal	3,492,648	3,579,552
Less current maturities	974,837	315,361
	$ 2,517,811	$ 3,264,191

(a)	Revenue Recognition

(b)	Going Concern

·         Engaged a third party specialist for advice and consultation  

·         Provided training and education to different accounting functions

·         Established review controls

·         Provided training for calculating the cost of raw material, work in progress, and finished goods.

·         Completed review of the Company's critical accounting and internal control policies with third party advisors that are knowledgeable regarding GAAP and internal controls

·         Provided training and education relating to accounting for modifications and extinguishments

·         Hired third party advisors to assist in preparing consolidated financial statements

·         Provide ongoing training and education relating to GAAP around complex and non-routine transactions specifically identified through regular review of emerging issues and Company business activities

·         Completing our review with the assistance of a third party advisor of the Company’s financial reporting controls and implementing recommended control procedures to strengthen the Company’s control procedures in areas which involve significant judgements and estimates, which involve application of complex accounting methods under GAAP, or which could have a material impact on the accuracy of our financial statements.

ITEM 1.        LEGAL PROCEEDINGS

The Company is from time to time involved in the ordinary course of litigation incidental to the conduct of its businesses. The Company believes that none of its pending litigation will have a material adverse effect on the Company's businesses, financial condition or results of operations. 

ITEM 1A.     RISK FACTORS

Not applicable. 

ITEM 2.        UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not applicable. 

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

Not applicable. 

ITEM 4.       MINE SAFETY DISCLOSURE

Not applicable. 

ITEM 5.       OTHER INFORMATION

Not applicable. 

ITEM 6.       EXHIBITS

The following exhibits are filed as part of this Quarterly Report on Form 10-Q for the quarterly period ending September 30, 2014:

1.1        Form of 9.00% Convertible Subordinated Debenture due July 1, 2014 (1) 

3(i)       Amended and Restated Articles of Incorporation, as amended (2) 

3(ii)      Amended and Superseding By-Laws of the Company, as amended (2) 

31         Rule 13a-14(a)/15d-14(a) Certifications 

32         Section 1350 Certifications 

100       XBRL-Related Documents

(1)             Incorporated by reference to the like numbered Exhibit to the Company's Current Report on Form 8-K filed with the Commission on February 7, 2011.

(2)             Incorporated by reference to the like numbered Exhibit to the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 1996.

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

 

1.I have reviewed this quarterly report on Form 10-Q of Oakridge Holdings, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the  period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and I have

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant's internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions)

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

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EXHIBIT 32

SECTION 1350 Certifications