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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------



For the period ended June 30, 2005



OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from  to



Commission file number 000-25315



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S WIND-UP CORPORATION

(Exact name of Registrant as specified in its Charter)



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|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Delaware                                                       |  | 94-3225290                             
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification Number)



P.O. BOX BD

LOS ALTOS, CA 94023

(Address of Principal Executive Offices including Zip Code)



(650) 599-5846

(Registrants Telephone Number, Including Area Code)



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ̈



Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange
Act).    Yes ̈No   x



As of June 30, 2005, Registrant had 47,109,843 shares of common stock issued
and outstanding.



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S WIND-UP CORPORATION



QUARTERLY
REPORT ON FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 2005



TABLE OF CONTENTS



|                              |  |                                                                                                              |  |         
|----------------------------- |  | ------------------------------------------------------------------------------------------------------------ |  | --------
|                              |  |                                                                                                              |  | Page No.
|PART I. FINANCIAL INFORMATION |  |                                                                                                             
|                              |  |                                                                                                             
|Item 1.                       |  | Financial Statements (unaudited):                                                                            |  |         
|                              |  |                                                                                                             
|                              |  | Statements of Net Assets in Liquidation, June 30, 2005 and December 31, 2004                                 |  | 3       
|                              |  |                                                                                                             
|                              |  | Statements of Changes in Net Assets in Liquidation for the three and six months ended June 30, 2005 and 2004 |  | 4       
|                              |  |                                                                                                             
|                              |  | Notes to Financial Statements                                                                                |  | 5       
|                              |  |                                                                                                             
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition                                                  |  | 8       
|                              |  |                                                                                                             
|Item 3.                       |  | Quantitative and Qualitative Disclosures About Market Risk                                                   |  | 13      
|                              |  |                                                                                                             
|Item 4.                       |  | Controls and Procedures                                                                                      |  | 13      
|                              | 
|PART II. OTHER INFORMATION    |  |                                                                                                             
|                              |  |                                                                                                             
|Item 1.                       |  | Legal Proceedings                                                                                            |  | 14      
|                              |  |                                                                                                             
|Item 6.                       |  | Exhibits                                                                                                     |  | 14      
|                              |  |                                                                                                             
|                              |  | SIGNATURES                                                                                                   |  | 15      



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PART I FINANCIAL INFORMATION



Item 1.Financial Statements



S WIND-UP CORPORATION



STATEMENTS OF NET ASSETS IN LIQUIDATION

(Unaudited, in thousands)



|                             |  |               |       |                   |   |      
|---------------------------- |  | ------------- | ----- | ----------------- | - | -----
|                             |  | June 30, 2005 |       | December 31, 2004
|ASSETS                       |  |               |       |                   |   |      
|Cash and cash equivalents    |  | $             | 1,258 |                   | $ | 1,423
|                             |  |               |       |                   |   |      
|Total assets                 |  | $             | 1,258 |                   | $ | 1,423
|                             |  |               |       |                   |   |      
|LIABILITIES                  |  |               |       |                   |   |      
|Accrued costs of liquidation |  | $             | 195   |                   | $ | 333  
|                             |  |               |       |                   |   |      
|Total liabilities            |  |               | 195   |                   |   | 333  
|                             |  |               |       |                   |   |      
|Contingencies (Note 3)       |  |               |       |                   |   |      
|Net assets in liquidation    |  | $             | 1,063 |                   | $ | 1,090
|                             |  |               |       |                   |   |      



The accompanying notes
are an integral part of these financial statements.



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S WIND-UP CORPORATION



STATEMENTS OF CHANGES IN NET ASSETS IN LIQUIDATION

(Unaudited, in thousands)



|                                                                                           |  |                                  |       |   |                                  |   |        |                                |  |   |                                |   |  |   |        |  
|------------------------------------------------------------------------------------------ |  | -------------------------------- | ----- | - | -------------------------------- | - | ------ | ------------------------------ |  | - | ------------------------------ | - |  | - | ------ | -
|                                                                                           |  | Three Months Ended June 30, 2005 |       |   | Three Months Ended June 30, 2004 |   |        | Six Months Ended June 30, 2005 |  |   | Six Months Ended June 30, 2004 |  
|Net decrease in net assets in liquidation:                                                 |  |                                  |       |   |                                  |   |        |                                |  |   |                                |   |  |   |        |  
|Interest income                                                                            |  | $                                | 7     |   |                                  | $ | 4      |                                |  | $ | 14                             |   |  | $ | 18     |  
|Refunds of utility and state tax payments                                                  |  |                                  | 2     |   |                                  |   | 5      |                                |  |   | 2                              |   |  |   | 15     |  
|Former employee medical expense payment                                                    |  |                                  | (12   | ) |                                  |   |       |                                |  |   | (12                            | ) |  |   |       |  
|Settlement of preferential transfer payment claim, including legal and administrative fees |  |                                  |      |   |                                  |   |       |                                |  |   | (31                            | ) |  |   |       |  
|Amount due from shareholder                                                                |  |                                  |      |   |                                  |   |       |                                |  |   |                               |   |  |   | 100    |  
|Amount due from Group 1                                                                    |  |                                  |      |   |                                  |   | 281    |                                |  |   |                               |   |  |   | 281    |  
|Initial distribution to stockholders                                                       |  |                                  |      |   |                                  |   | (4,711 | )                              |  |   |                               |   |  |   | (4,711 | )
|                                                                                           |  |                                  |       |   |                                  |   |        |                                |  |   |                                |   |  |   |        |  
|Net decrease in net assets in liquidation:                                                 |  |                                  | (3    | ) |                                  |   | (4,421 | )                              |  |   | (27                            | ) |  |   | (4,297 | )
|Net assets in liquidation, beginning of period                                             |  |                                  | 1,066 |   |                                  |   | 5,464  |                                |  |   | 1,090                          |   |  |   | 5,340  |  
|                                                                                           |  |                                  |       |   |                                  |   |        |                                |  |   |                                |   |  |   |        |  
|Net assets in liquidation, end of period                                                   |  | $                                | 1,063 |   |                                  | $ | 1,043  |                                |  | $ | 1,063                          |   |  | $ | 1,043  |  
|                                                                                           |  |                                  |       |   |                                  |   |        |                                |  |   |                                |   |  |   |        |  



The accompanying notes
are an integral part of these financial statements.



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S WIND-UP CORPORATION



NOTES TO
FINANCIAL STATEMENTS

(Unaudited)

(In thousands, except where noted)



NOTE 1. The Company and Recent Developments



S
Wind-up Corporation, formerly Sagent Technology, Inc., a Delaware corporation (Sagent, S Wind-up, the Company, we, us, or our) is engaged in the process of an orderly
liquidation of remaining assets, the winding up of its business and operations, and the dissolution of the Company.



On April 15, 2003, we entered into a definitive asset purchase agreement (the Asset Purchase Agreement) to sell substantially all of our
assets to Group 1 Software, Inc. (Group 1). On September 30, 2003, the holders of a majority of our outstanding shares approved the asset sale contemplated by the Asset Purchase Agreement and approved a plan of complete liquidation and
dissolution. The key features of the plan are (1) file a certificate of dissolution with the Secretary of State of the State of Delaware; (2) cease conducting normal business operations, except as may be required to wind up our business affairs; (3)
attempt to convert all of our remaining assets into cash or cash equivalents in an orderly fashion; (4) pay or attempt to adequately provide for the payment of all of our known obligations and liabilities; and (5) distribute pro rata in one or more
liquidating distributions all of our remaining assets to our stockholders as of the applicable record date.



In connection with the adoption of the plan and the anticipated liquidation, we adopted the liquidation basis of accounting effective October 1, 2003,
whereby assets are valued at their estimated net realizable cash values and liabilities are stated at their estimated settlement amounts. Uncertainties as to the precise net value of our non-cash assets, and the ultimate amount of our liabilities
make it impracticable to predict the aggregate net value that may ultimately be distributable to stockholders. Claims, liabilities and future expenses for operations, although currently declining, will continue to be incurred with execution of the
plan. These costs will reduce the amount of net assets available for ultimate distribution to stockholders. Although we do not believe that a precise estimate of those expenses can currently be made, we believe that available cash and cash
equivalents and amounts received from sales of non-cash assets will be adequate to provide for our obligations, liabilities, operating costs and claims, and to make cash distributions to stockholders. If available cash and amounts received from
sales of non-cash assets are not adequate to provide for our obligations, liabilities, operating costs and claims, estimated future distributions of cash to our stockholders will be reduced.



We filed Articles of Dissolution with the Secretary of State of the State of
Delaware effective April 15, 2004. Pursuant to Delaware law, S Wind-up Corporation will continue in existence until at least April 15, 2007. During this period, we will continue to convert our estimated net assets to cash for future distribution to
our stockholders. We are not permitted to continue our business as a going concern.



At the close of business on April 15, 2004, we closed our stock transfer books and discontinued recording transfers of our common stock. No assignments or transfers of our common stock were recorded or will be
recorded after April 15, 2004. Any future distributions we make will be made solely to the stockholders of record as of the close of business on April 15, 2004. We intend, in the future, to seek relief from the Securities and Exchange Commission
from the reporting requirements under the Exchange Act. Since we closed our stock records on April 15, 2004, our shares have continued to trade in the Over the Counter Markets pink sheets. The stock has been trading under
due-bill contractual obligations between the seller and purchaser of the stock, which negotiate and rely on themselves with respect to the allocation of stockholder proceeds arising from ownership of the shares. From time to time,
trading volume in our shares has been relatively high, and our shares have traded at prices in excess of the highest price we have estimated for potential liquidation distributions. Traders in our shares are cautioned that our shares are highly
speculative, and we cannot predict with any accuracy when, or if, additional liquidation distributions will be made.



Since October 1, 2003, our operations have been limited to winding-up our business and affairs, selling our remaining assets and discharging our known
liabilities. On February 26, 2004, our board of directors approved an initial distribution, and on April 6, 2004 we completed the initial distribution of $0.10 for each share of stock held as of the record date of March 31, 2004 pursuant to the Plan
of Liquidation and Dissolution approved by the stockholders on September 30, 2003. We plan to distribute any remaining assets to our stockholders, all in accordance with the plan of dissolution.



Distributions ultimately made to stockholders upon liquidation will differ
from the net assets in liquidation recorded in the accompanying statement of net assets in liquidation as a result of adjustments, if any, to estimated costs of liquidation. It is our intention to settle our outstanding obligations and
sell our remaining assets as expeditiously as possible. Final dissolution and related distributions to stockholders will occur upon obtaining final resolution on all liquidation issues.



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We may at some point determine that the continued liquidation of S Wind-up Corporation may be more
efficiently handled by retaining a third party liquidator to manage the liquidation process. We cannot predict when or if we will engage a third party liquidator.



Business of the Issuer



Prior to October 1, 2003, we offered a complete business intelligence software platform that allows business users and information technology (IT)
departments to work together to integrate, analyze, deliver and understand information. We operated as a single business segment.



NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



Basis of Presentation



As a result of the stockholders approval of the plan of dissolution and the imminent nature of the liquidation, we changed our basis of accounting
to the liquidation basis as of October 1, 2003. This basis of accounting is considered appropriate when, among other things, liquidation of a company is probable and the net realizable value of assets is reasonably determinable. Under the
liquidation basis of accounting, assets are stated at their estimated net realizable cash value and liabilities are stated at their anticipated settlement amounts. Upon changing to the liquidation basis of accounting, we recorded an $8.0 million
increase to net assets. Included in the adjustment to net assets recorded in connection with the change from the going-concern to the liquidation basis of accounting on October 1, 2003, we recorded $1.9 million of accrued costs of liquidation
representing the estimate of the costs to be incurred during dissolution; however actual costs could vary from those estimates.



The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim
financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in
the United States of America have been omitted. These financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2004.



Use of Estimates



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of
America 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. Examples of such estimates include, but are not limited to, the accounting for contingencies and accrued costs of liquidation, which represents the estimate of costs to be incurred during dissolution. Our
current estimated range of loss related to some of the contingencies is based on claims for which we can estimate the amount and range of loss. Actual results could differ from those estimates.



We have made a number of estimates and assumptions relating to the reporting
of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with accounting principles generally accepted in the United States of America. Significant assumptions inherent in
the preparation of the accompanying financial statements include, but are not limited to, accrued costs of liquidation and commitments and contingencies. Actual results could differ from those estimates.



NOTE 3. CONTINGENCIES



From time to time, we have been subject to pending or threatened litigation. We are currently engaged in certain legal and
administrative proceedings incidental to our previous business activities and current dissolution efforts and believe that these matters will not have a material adverse effect on our financial position. However, the results of legal proceedings
cannot be predicted with certainty. Pending or future litigation could be costly and could upon resolution, have a material adverse affect on our financial position.



In March 2005, AmeriKing, Inc.s (a former Sagent customer) trustee filed a complaint against us in the United States
Bankruptcy Court for the District of Delaware to avoid and recover certain preferential transfer payments totaling $28. The Company has agreed to a settlement of $25 for the complaint. In addition, the Company has incurred legal and administrative
costs of approximately $2.



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NOTE 4. GUARANTEES



Prior to the sale of our assets to Group 1, we entered into standard indemnification provisions within our software license agreements with our customers
and technology partners. Pursuant to these provisions, we historically offered to indemnify, defend and hold harmless the indemnified party for losses suffered or incurred by the indemnified party in connection with any U.S. patent, copyright or
other intellectual property infringement claim by any third party with respect to our products. The term of these indemnification provisions was generally perpetual any time after execution of the license agreement. The maximum potential amount of
future payments that we could be required to make under these indemnification provisions was unlimited. We have, in the past, incurred costs to defend intellectual property lawsuits.



We have agreements in place with our directors and officers whereby we indemnify them for certain events or occurrences
while the officer or director is, or was, serving at our request in such capacity. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have a tail director and
officer insurance policy, which may enable us to recover a portion of any future amounts paid.



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Item 2.Managements Discussion and Analysis of Financial Condition



The Managements Discussion and Analysis of Financial Condition and Results of Operations contains forward looking statements as that
term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on a number of assumptions by us about the future, usually based on current conditions. These assumptions may or may not prove to be
correct and, as a result, our own forward-looking statements may also be inaccurate. On the other hand, based on what we know today and what we expect in the future, we believe that the forward-looking statements we make in this report are
reasonable. In most cases, when we use words like believe, expect, estimate, anticipate, project, plan, or predict to describe something which has not yet occurred,
we are making a forward-looking statement. These forward-looking statements involve risks and uncertainties. These risks and uncertainties include that we may have underestimated the amount of our obligations and liabilities, risks associated with
our liquidation and dissolution, including without limitation, settlement of our liabilities and obligations, costs incurred in connection with carrying out the plan of liquidation and dissolution and any potential additional expense, discharge of
contingent liabilities, and the winding up and dissolution of the Corporation.



Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements.
You should not place undue reliance on our forward-looking statements, as they are not guarantees of future results or distributions and represent our expectations only as of the date they are made.



Upon the sale of substantially all of our operating assets to Group 1 on
October 1, 2003, most of our employees resigned and accepted employment with Group 1 and we ceased operations. Two executives remained through April 15, 2004 to manage the Companys wind down, liquidation and the first distribution to the
stockholders. On April 15, 2004, we held a final board meeting. We retain a trailing director and accounting agent to manage the remaining wind down and liquidation process. We cannot list here all of the risks and uncertainties that could cause our
actual future financial results to differ materially from our present expectations or projections regarding estimated distribution to stockholders but we can identify many of them. For example, our future results could be affected by the cost of
satisfying currently known liabilities, the need to satisfy unanticipated liabilities that might arise in the future, the expenses of dissolving and winding up the Company, and the price at which S Wind-up stock may be held or sold. It is important
to remember that forward-looking statements speak only as of the date when they are made and we do not promise that we will publicly update or revise those statements whenever conditions change or future events occur. Accordingly we do not recommend
that any person seeking to evaluate our Company should place undue reliance on any forward-looking statements in this report.



The following discussion and analysis should be read in conjunction with our financial statements and related notes in Item 1.



Critical Accounting Policies and Estimates



In connection with the adoption of the plan of dissolution and the
anticipated liquidation, we adopted the liquidation basis of accounting effective October 1, 2003, whereby assets are valued at their estimated net realizable cash values and liabilities are stated at their estimated settlement amounts. The
preparation of financial statements using the liquidation basis of accounting requires us to make assumptions, judgments and estimates that can have a significant impact on our reported net assets in liquidation. We base our assumptions, judgments
and estimates on the most recent information available and various other factors that we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. On a
regular basis we evaluate our assumptions, judgments and estimates and make changes accordingly. We believe that the assumptions, judgments and estimates involved in the accounting for estimated costs to be incurred during liquidation have the
greatest potential impact on our financial statements, so we consider these estimates to be our critical accounting policies. We discuss below the critical accounting estimates associated with these policies.



Estimated Costs to be Incurred During Liquidation



Under the liquidation basis of accounting, we accrue for the remaining costs
to be incurred during liquidation, including consulting fees, fees of professional service providers and miscellaneous other costs, partially offset by estimated future interest earnings. Such costs were estimated at $195,000 and $308,000 at June
30, 2005 and 2004, respectively. Our estimates are based on assumptions regarding our ability to settle outstanding obligations to creditors, resolve outstanding litigation, successfully petition the Securities Exchange Commission (SEC)
for relief from public company reporting requirements, and the timing of distributions to stockholders. If there are delays, or we are not successful, in achieving these objectives, actual costs incurred during liquidation may increase, reducing net
assets available in liquidation.



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We believe the following critical accounting policies affected our more significant judgments and
estimates used in the preparation of our consolidated financial statements:



Contingent Liabilities



Our estimated
range of liabilities relating to litigation is based on claims for which we can reasonably estimate the amount and range of loss (as discussed in Part II, Item 1. Legal Proceedings). We record a liability if it is (1) probable that an obligation was
incurred because of a transaction or event happening on or before the date of the financial statements and (2) the amount of the obligation can be reasonably estimated.



Accrued Costs of Liquidation and Effects of Change to Liquidation Basis



Pursuant to the plan of dissolution, which was approved by stockholders on
September 30, 2003, we filed Articles of Dissolution with the Secretary of State of the State of Delaware on April 15, 2004. Since October 1, 2003, our operations have been limited to winding-up our business and affairs, selling our remaining assets
and discharging our known liabilities. On February 26, 2004, our board of directors approved an initial distribution, and on April 6, 2004 we completed the initial distribution of $0.10 for each share of stock held as of the record date of March 31,
2004 pursuant to the Plan of Liquidation and Dissolution approved by the stockholders on September 30, 2003. We plan to distribute any remaining assets to our stockholders, all in accordance with the plan of dissolution. As a result of the plan of
dissolution, we changed our basis of accounting to the liquidation basis as of October 1, 2003. Under the liquidation basis of accounting, assets are stated at their estimated net realizable cash value and liabilities are stated at their anticipated
settlement amounts. Upon changing to the liquidation basis of accounting, we recorded an $8.0 million increase to net assets. Included in the adjustment to net assets recorded in connection with the change from the going-concern to the liquidation
basis of accounting, we recorded $1.9 million of accrued costs of liquidation representing the estimate of the costs to be incurred during dissolution; however, actual costs could vary from those estimates. Distributions ultimately made to
stockholders upon liquidation will differ from the net assets in liquidation recorded in the accompanying statement of net assets in liquidation as a result of adjustments, if any, to estimated costs of liquidation. It is our intention
to settle our outstanding obligations and sell our remaining assets as expeditiously as possible. Final dissolution and related distributions to stockholders will occur upon obtaining final resolution on all liquidation issues.



At June 30, 2005 and December 31, 2004, the following represents the
estimated costs of liquidation (in thousands):



|                                     |  |               |     |                   |   |    
|------------------------------------ |  | ------------- | --- | ----------------- | - | ---
|                                     |  | June 30, 2005 |     | December 31, 2004
|Legal, audit and tax services        |  |               | 157 |                   |   | 311
|Other estimated costs of liquidation |  |               | 38  |                   |   | 22 
|                                     |  |               |     |                   |   |    
|Total                                |  | $             | 195 |                   | $ | 333
|                                     |  |               |     |                   |   |    



Changes in Net Assets in
Liquidation for the quarters ended June 30, 2005 and 2004



For the quarters ended June 30, 2005 and 2004, we recorded $7,000 and $4,000 in interest income, respectively. We also recorded $2,000 and $5,000 of refunds of utility and state tax payments for the quarters ended June 30, 2005 and 2004,
respectively. For the quarter ended June 30, 2005, we recorded $12,000 for a medical claim expense due to the self-funded plan previously maintained by Sagent. For the quarter ended June 30, 2004, we recorded $281,000 as amount due from Group 1and
recorded an initial distribution to stockholders of $4.7 million.



Changes
in Net Assets in Liquidation for the six months ended June 30, 2005 and 2004



For the six months ended June 30, 2005 and 2004, we recorded $14,000 and $18,000 in interest income, respectively. We also recorded $2,000 and $15,000 of refunds of utility and state tax payments for the quarters
ended June 30, 2005 and 2004, respectively. For the six months ended June 30, 2005, we recorded $12,000 for a medical claim expense due to the self-funded plan previously maintained by Sagent and $31,000 for settlement of a preferential transfer
claim, including $6,000 of legal and administrative fees. For the six months ended June 30, 2004, we recorded receipt of $100,000 of note receivable from shareholder, $281,000 as amount due from Group 1and recorded an initial distribution to
stockholders of $4.7 million.



Liquidity and Capital Resources



As of June 30, 2005, our net assets in liquidation
were $1.1 million, including primarily cash and cash equivalents of $1.3 million less accrued costs of liquidation of $195,000. During the quarter ended June 30, 2005, we extinguished $103,000 of our accrued costs of liquidation. We also recorded
$7,000 of interest income. At June 30, 2004, our net assets in liquidation were $1.0 million, consisting primarily cash and cash equivalents of $1.0 million and other receivables of $381,000 less accrued costs of liquidation of $308,000. During the
quarter ended June 30, 2004, we extinguished $0.5 million of our accounts payable and accrued costs of liquidation.



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Outstanding Liabilities



At June 30, 2005, we had $195,000 in accrued costs of liquidation. Our cash is being used to pay our outstanding liabilities
and obligations, and to establish a reserve for future liabilities and expenses. Any cash not used to satisfy liabilities and expenses will be distributed to stockholders. It is our intention to settle our outstanding obligations and sell our
remaining assets as expeditiously as possible. Final dissolution of the Company and related distributions to our stockholders will occur upon obtaining final resolution of all liquidation issues.



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Risk Factors



In addition to other information in this Form 10-Q, the following risk factors should be carefully considered in evaluating us and our liquidation and
dissolution because such factors may have a significant impact on the execution of our plan of dissolution and the timing and amount of liquidating distributions, if any, to our stockholders. As a result of the risk factors set forth below and
elsewhere in this Form 10-Q, and the risks discussed in our other Securities and Exchange Commission filings, actual results could differ materially from those projected in any forward-looking statements. Additional risks and uncertainties not known
to us or that we now believe to be unimportant could also impair our liquidation and dissolution. As a result, the market price of our common stock could decline, and you may lose all of your investment. This section should be read in conjunction
with the financial statements and notes thereto, and Managements Discussions and Analysis of Financial Condition and Results of Operations contained in this Form 10-Q.



We cannot assure you of the exact amount or timing of any future distribution to our stockholders under the plan of dissolution.



The liquidation and dissolution process is subject to
numerous uncertainties and may not result in any remaining capital for future distribution to our stockholders. The precise nature, amount and timing of any future distribution to our stockholders will depend on and could be delayed by, among other
things, administrative and tax filings associated with our dissolution, potential claim settlements with creditors, and unexpected or greater than expected expenses. Furthermore, we cannot provide any assurances that we will actually make additional
distributions. The estimates we have provided are based on currently available information, and actual payments, if any, could be substantially less than the range we have estimated. Any amounts to be distributed to our stockholders may be less than
the price or prices at which our common stock has recently traded or may trade in the future.



Although we are in the process of dissolution, our common stock may continue to trade, and liquidating distributions, if any, may be below any trading price.



At the close of business on April 15, 2004, we closed our stock transfer
books and discontinued recording transfers of our common stock. Since we closed our stock records on April 15, 2004, our shares have continued to trade in the Over the Counter Markets pink sheets. The stock has been trading under
due-bill contractual obligations between the seller and purchaser of the stock, which negotiate and rely on themselves with respect to the allocation of stockholder proceeds arising from ownership of the shares. From time to time,
trading volume in our shares has been relatively high, and our shares have traded at prices in excess of the highest price we have estimated for potential liquidation distributions. Traders in our shares are cautioned that our shares are highly
speculative, and we cannot predict with any accuracy when, or if, additional liquidation distributions will be made.



We will continue to incur claims, liabilities and expenses that will reduce the amount available for distribution out of the liquidation to stockholders.



Claims, liabilities and expenses incurred during the
wind down process, such as legal, accounting and consulting fees and miscellaneous office expenses, will reduce the amount of assets available for future distribution out of the liquidation to stockholders. If available cash and amounts received on
the sale of non-cash assets are not adequate to provide for our obligations, liabilities, expenses and claims, we may not be able to distribute out of the liquidation meaningful cash, or any cash at all, to our stockholders.



We will continue to incur the expenses of complying with public company reporting
requirements.



We have an obligation to continue to
comply with the applicable reporting requirements of the Securities Exchange Act of 1934, as amended, referred to as the Exchange Act, even though compliance with such reporting requirements is economically burdensome. We intend to seek
relief from the Securities and Exchange Commission from the reporting requirements under the Exchange Act at such time in the future as active trading in our shares has ceased. We anticipate that, if such relief were granted, we would continue to
file current reports on Form 8-K to disclose material events relating to our liquidation and dissolution along with any other reports that the Securities and Exchange Commission might require. However, the Securities and Exchange Commission may not
grant any such relief, and we do not anticipate we will be able to request relief while active trading of our shares is continuing.



Our board of directors may at any time turn management of the liquidation of S Wind-up Corporation over to a third party, and our director may resign from our board
at that time.



Our director may at any time turn our
management over to a third party to complete the liquidation of our remaining assets and distribute the available proceeds to our stockholders, and our director may resign from our board at that time. Our board of directors currently consists of Irv
H. Lichtenwald, who is overseeing our liquidation. If management is turned over to a third party and our director resigns from our board, the third party would have sole control over the liquidation process, including the sale or distribution of any
remaining assets.



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If we are deemed to be an investment company, we may be subject to substantial regulation that would cause us to
incur additional expenses and reduce the amount of assets available for distribution.



If we invest our cash and/or cash equivalents in investment securities, we may be subject to regulation under the Investment Company Act of 1940. If we are deemed to be an investment company under the Investment
Company Act because of our investment securities holdings, we must register as an investment company under the Investment Company Act. As a registered investment company, we would be subject to the further regulatory oversight of the Division of
Investment Management of the Securities and Exchange Commission, and our activities would be subject to substantial regulation under the Investment Company Act. Compliance with these regulations would cause us to incur additional expenses, which
would reduce the amount of assets available for distribution to our stockholders. To avoid these compliance costs, we intend to invest our cash proceeds in money market funds and government securities, which are exempt from the Investment Company
Act but which currently provide a very modest return.



Distribution of
cash, if any, to our stockholders could be delayed.



Our Board of Directors effected an initial distribution on April 6, 2004, to our stockholders as of the record date March 31, 2004, and we are currently unable to predict the precise timing of further distributions, if any, pursuant to our
wind down. The timing of distributions, if any, will depend on and could be delayed by, among other things, the timing of claim settlements with creditors, if any, and the amounts paid out under warranty claims. Additionally, a creditor could seek
an injunction against the making of distributions to our stockholders on the ground that the amounts to be distributed were needed to provide for the payment of our liabilities and expenses. Additionally, we could seek protection from creditors
under the federal bankruptcy code. Any action of this type could delay or substantially diminish, or eliminate, the amount available for distribution to our stockholders.



If we fail to create an adequate contingency reserve for payment of our expenses and liabilities, our stockholders could be held
liable for payment to our creditors of each such stockholders pro rata share of amounts owed to the creditors in excess of the contingency reserve, up to the amount actually distributed to such stockholder.



Following the plan of dissolution ratified and approved by our stockholders
on September 30, 2003, we filed a Certificate of Dissolution with the State of Delaware dissolving the Company. Pursuant to the Delaware General Corporation Law, we will continue to exist for three years after the dissolution became effective or for
such longer period as the Delaware Court of Chancery shall direct, for the purpose of prosecuting and defending suits against us and enabling us gradually to close our business, to dispose of our property, to discharge our liabilities and to
distribute to our stockholders any remaining assets. Under the Delaware General Corporation Law, in the event we fail to create an adequate contingency reserve for payment of our expenses and liabilities during this three-year period, each
stockholder could be held liable for payment to our creditors of such stockholders pro rata share of amounts owed to creditors in excess of the contingency reserve, up to the amount actually distributed to such stockholder.



However, the liability of any stockholder would be limited to the amounts
previously received by such stockholder from us (and from any liquidating trust or trusts) in the dissolution. Accordingly, in such event a stockholder could be required to return all distributions previously made to such stockholder. In such event,
a stockholder could receive nothing from us under the plan of dissolution. Moreover, in the event a stockholder has paid taxes on amounts previously received, a repayment of all or a portion of such amount could result in a stockholder incurring a
net tax cost if the stockholders repayment of an amount previously distributed does not cause a commensurate reduction in taxes payable. There can be no assurance that the contingency reserve established by us will be adequate to cover any
expenses and liabilities.



Our stock transfer books closed on the date we
filed the certificate of dissolution with the Delaware Secretary of State, after which stockholders are not able to publicly trade our stock.



We closed our stock transfer books and discontinued recording transfers of our common stock at the close of business on the date we filed the Certificate
of Dissolution with the Delaware Secretary of State, referred to as the final record date. Thereafter, certificates representing our common stock shall not be assignable or transferable on our books except by will, intestate succession
or operation of law. The proportionate interests of all of our stockholders shall be fixed on the basis of their respective stock holdings at the close of business on the final record date, and, after the final record date, any distributions made by
us shall be made solely to the stockholders of record at the close of business on the final record date, except as may be necessary to reflect subsequent transfers recorded on our books as a result of any assignments by will, intestate succession or
operation of law.



Threatened litigation could harm our financial
position.



As of June 30, 2005, there are no material
legal proceedings involving the Company, however in March 2005, AmeriKing, Inc.s (a former Sagent customer) trustee filed a complaint against us in the United States Bankruptcy Court for the District of Delaware to avoid and recover certain
preferential transfers payments totaling $28,000. The Company agreed to a settlement of $25,000 for the complaint. In addition, the Company incurred legal and administrative costs of approximately $2,000.



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Item 3. Qualitative and Quantitative Disclosures about Market Risk



We are exposed to certain market risks, including the effects of adverse changes in interest rates. Our exposure to such changes results from cash
deposits managed by Bank of America and Banc of America Investment Services, Inc. As of June 30, 2005, we have no financial instruments in place to manage the impact of changes in interest rates. We estimate that a 1% increase or decrease in
interest rates would have impacted our income from these assets by less than $13,000 for the three months ended June 30, 2005 and $14,000 for the year ended December 31, 2004.



Item 4. Controls and Procedures



Evaluation of
Disclosure Controls and Procedures



As of October 1, 2003, the Company
sold substantially all of its assets and began the orderly dissolution and liquidation of its assets. As the Company currently has no ongoing operations, chief executive officer, principal financial officers, principal accounting officer or
employees, the evaluation of the effectiveness of the design and operation of the Companys disclosure controls and procedures as of the end of the period covered by this report was performed by the Companys sole director. Based on that
evaluation, the Companys sole director has concluded that the Companys disclosure controls and procedures are effective as of the end of the period covered by this report to ensure that information required to be disclosed in reports
that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.



Changes in Internal Control Over Financial Reporting



There has been no change in our internal control over financial reporting that occurred
during the period covered by this report that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.



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S WIND-UP CORPORATION



PART II OTHER INFORMATION



Item 1. Legal Proceedings



From
time to time, we have been subject to pending or threatened litigation. As discussed in Note 3 to the financial statements, we are currently engaged in certain legal and administrative proceedings incidental to our previous business activities and
current dissolution efforts and believe that these matters will not have a material adverse effect on our financial position. However, the results of legal proceedings cannot be predicted with certainty. Pending or future litigation could be costly
and could upon resolution, have a material adverse affect on our financial position.



Item 6. Exhibits and Reports on Form 8-K



(a)
Exhibits



|   |  |                                                                        
|-- |  | -----------------------------------------------------------------------
|31 |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|   | 
|32 |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



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SIGNATURES



In accordance with the Exchange Act,
this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.



|                             |  |                      |  | 
|---------------------------- |  | -------------------- |  | 
|/s/ Irv H. Lichtenwald       |  | Date: August 5, 2005 |  | 
|Irv H. Lichtenwald, Director |  |                      | 



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