<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
1ST Amendment
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES ACT OF 1934
SHANECY, INC.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
DELAWARE 88-0407731
------------------------------- ----------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
13640 WHITE ROCK STATION ROAD
POWAY, CA 92064
---------------------------------------- ----------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(619)699-1739
- ---------------------------
(ISSUER'S TELEPHONE NUMBER)
SECURITIES TO BE REGISTERED UNDER SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH
TO BE SO REGISTERED EACH CLASS IS TO BE REGISTERED
- -------------------------------- --------------------------------------
- -------------------------------- --------------------------------------
SECURITIES TO BE REGISTERED UNDER SECTION 12(g) OF THE ACT:
Common Stock - .001 Par Value
-----------------------------
(TITLE OF CLASS)
1
<PAGE> 2
PART I
ITEM 1
DESCRIPTION OF THE BUSINESS
General
Shanecy, Inc. is filing this Form 10-SB on a voluntary basis in order to make
Shanecy, Inc.'s financial information equally available to any interested
parties or investors and meet certain listing requirements for publicly traded
securities.
Business Development
Shanecy, Inc. was incorporated in Delaware on May 31, 1994. The Company was
organized in order to implement management's concept for a home health care
analysis and referral service. Management determined that programming and
development costs combined with the considerable changes occurring in the
healthcare industry in the mid-1990's necessitated a delay in completing the
Company's business plan. During 1995 the Company raised funds necessary to keep
the Company current in its state fees and taxes by the sale of stock to
investors. In January of 1999 the board of directors voted to seek additional
capital and implement the Company's business plan.
There have been no bankruptcy, receivership or similar proceedings.
There have been no material reclassifications, mergers, consolidations, or
purchase or sale of a significant amount of assets not in the ordinary course of
business.
Business of the Issuer
Beginning in 1998, Management determined the Company would complete the
development of its home care analysis and referral service for the families of
elderly or homebound patients. Management's decision was based primarily on the
following factors; 1) annual increase of patients requiring health care
assistance who are ineligible for long-term hospitalization, 2) discharge of
patients unable to immediately return to normal routine, 3) proposed changes in
Medicare/Medicaid home care regulations, 4) large numbers of uncertified and
unregulated home care providers, and, 5) consumer Internet access and marketing
potential that was unavailable in prior years.
The Company's analysis and referral service will require software programming
necessary to develop a system for consumers that integrates such data as a
patient's care needs, a rating system for care providers that offer services in
their community, coverage by insurance or government agency, and financial
constraints of the family. Management has extensive experience with all facets
of long term health care management and information systems used by health care
providers. Based upon Management's extensive knowledge and experience in
information systems, the Company estimates that software programming costs will
not exceed $50,000. The Company will also use additional commercially available
hardware and software for information systems and Internet website service that
the Company estimates will not exceed $150,000.
2
<PAGE> 3
Management intends to market its service through direct marketing to home care
providers, hospitals and doctors, and to consumers through the use of its
Internet website. Management has begun informal discussions with Southern
California health care providers, but the Company has no market or distribution
agreements with any home care providers, doctors, hospitals, or Internet sales
sites. Management estimates the Company will require approximately twelve months
to raise sufficient funding in order to seek out marketing agreements with home
care providers and distribution agreements with hospitals and physicians.
The Company has no new product or service planned or announced to the public.
The size and financial strengths of the Company's competitors are substantially
greater than those of the Company. Although Management has limited access to
in-depth information regarding the operations of the Company's competitors,
Management believes that the Company can effectively compete because of the
unique nature of its analysis which specializes in providing assistance to the
increasing market of home care patients. Management intends to target those
consumers who require Home Care Aides (HCA's), homemakers or companions for
daily or occasional support. Management also considers it significant that their
analysis would provide families with information necessary to determine, with
the assistance of their physician, the level of home care required and the
services available in their community. Management is not aware of any
significant barriers to the Company's entry into the home care analysis and
referral market, however, the Company at this time cannot ascertain its exact
market share of this market.
Software and website design and programming are available through numerous
suppliers such as Integrated Software Solutions and McNeill Consulting Services.
While Management has already had several initial design meetings with suppliers,
the Company currently has no contracts with suppliers and will not complete
contracts with potential suppliers until such time as the Company has sufficient
funding. Over the next twelve months the Company intends to achieve the
following goals in order to market its services: raise capital needed to fund
its business plan through the sale of securities, complete and test all custom
software, purchase all furniture, fixtures, office equipment, and off-the- shelf
software, and secure office space. Based upon sufficient funding from the
Company's securities sales, Management will begin marketing in approximately
month nine of its business plan and Internet marketing in approximately month
twelve of its business plan.
The Company intends to offer its services for families of elderly or homebound
patients through direct marketing to home care providers, hospitals, and doctors
throughout Southern California. In addition, the Company will market to
consumers in Southern California and other Western states through the Internet
on its own proposed website and will not depend on any one or a few major
customers. Management has extensive experience in this market and a large
network of health care providers in the Western region of the United States.
Based upon sufficient funding from the Company's securities sales, Management
will begin direct marketing in approximately month nine of its business plan and
Internet marketing in approximately month twelve of its business plan.
When the Company has sufficient funding, management will seek legal council to
determine if copyright or trademark protection is required. Management at this
time cannot accurately estimate what will constitute sufficient funding.
The Company does not need any governmental approval of its principal product or
service. The Company's business is not subject to material regulation by
federal, state, or local governmental agencies. The company currently has no
employees.
3
<PAGE> 4
Year 2000 Disclosure
Computer programs used in business applications usually have time-sensitive
software that may recognize a date using "00" as the year 1900 rather than the
year 2000. This could result in system data failure that might cause disruption
of the user's business activities.
In assessing available software and software programming, the Company has
determined that its proposed software will be Year 2000 compatible and any other
purchased software will be off-the-shelf software that will be certified Year
2000 compatible for all of its computing requirements. Based upon this
assessment, management believes the Year 2000 issue will not pose significant
operational problems and will not materially affect future financial results.
The Company currently anticipates purchasing new off-the-shelf Year 2000
compatible software by September 30, 1999, which is prior to any anticipated
impact on its operating systems. The total cost of this new software is not
anticipated to be a material expense to the Company at this time. However, there
can be no guarantee that these new off-the-shelf software products will be
adequately modified, which could have a material adverse effect on the Company's
results of operations.
ITEM 2
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION
Plan of Operation
The Company's current cash balance is sufficient in Management's opinion until
additional capital can be raised to implement the Company's business plan.
Management intends to implement a business plan for the Company that includes
raising capital needed to fund its operations through the sale of securities,
completing and testing of all custom software, opening an Internet web site,
purchasing office furniture, equipment, and off-the-shelf software, and leasing
office space. Management anticipates that the funds needed to complete these
steps and pay for operating expenses to be approximately $250,000 to $350,000.
In order to remain a going concern the Company must first utilize private
placement funding in order to implement its business plan and maintain a
positive cash flow. There are considerable risks in the implementation of the
Company's business plan, including insufficient funding from private placement
securities sales, greater than anticipated costs for software and insufficient
revenues from sales. Without sufficient cash flow, the Company would rely on its
existing cash and loans from its officers until such time as the Company could
raise sufficient private placement funds to implement its plans.
There are no current plans for product research and development. There are no
current plans to purchase or sell any significant amount of fixed assets. There
are no current plans to increase the number of employees.
4
<PAGE> 5
Results of Operations
There were no revenues from sales for the period ended January 31, 1999. The
Company sustained a net loss of $3,236 for the ten months ended January 31,
1999. Losses were primarily attributable to expenditures for operating expenses
of the corporation.
Liquidity and Capital Resources
As of January 31, 1999, the Company had $464 cash on hand and in the bank. The
primary costs and operating expenses for the ten months ended January 31, 1999
were $2,300 in professional fees, and $880 in licenses and fees.
Currently, the Company maintains a sufficient positive cash balance for working
capital. The losses through January 1999 were due to a lack of revenues and
operating expenses incurred.
ITEM 3
DESCRIPTION OF PROPERTY
The Company's principal executive office address and telephone number are
provided by a Director of the Company at no cost. Management considers the
Company's current principal office space arrangement adequate for current and
short-term estimated growth.
ITEM 4
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth information on the ownership of the Company's
voting securities by Officers, Directors and major shareholders as well as those
who own beneficially more than five percent of the Company's common stock
through the most current date - January 31,1999:
<TABLE>
<CAPTION>
Title Of Name & Amount & Percent
Class Address Nature of owner Owned
- ----- ------- --------------- -----
<S> <C> <C> <C>
Common Ann Myers 4,500,000 (a) 42%
1605 Mirage Court
El Cajon, CA 92019
Common Jill Wright 4,500,000 (b) 42%
13640 White Rock Station Rd.
Poway, Ca 92064
</TABLE>
5
<PAGE> 6
(a) Ms. Myers received 50,000 shares of the Company's common stock in 1994
for services, another 50,000 shares were issued to her for services in
February 1998. 4,400,000 shares of the Company's common stock were
issued to her per a 45 for 1 stock split on February 28, 1998.
(b) Ms. Wright received 50,000 shares of the Company's common stock in 1994
for services, another 50,000 shares were issued to her for services in
February 1998. 4,400,000 shares of the Company's common stock were
issued to her per a 45 for 1 stock split on February 28, 1998.
ITEM 5
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS,
AND CONTROL PERSONS
The Directors and Officers of the Company, all of those whose terms will expire
at the 1999 shareholder meeting, or at such a time as their successors shall be
elected and qualified, are as follows:
<TABLE>
<CAPTION>
Name & Address Age Position Date First Elected
- -------------- --- -------- ------------------
<S> <C> <C> <C>
Ann Myers 68 President, 6/14/94
1605 Mirage Court Secretary,
El Cajon, CA 92019 Director
Jill Wright 55 Director 6/14/94
13640 White Rock Station Road Treasurer
Poway, Ca 92064
</TABLE>
Each of the foregoing persons may be deemed a "promoter" of the Company, as that
term is defined in the rules and regulations promulgated under the Securities
and Exchange Act of 1933.
Directors are elected to serve until the next annual meeting of stockholders and
until their successors have been elected and qualified. Officers appointed to
serve until the meeting of the Board of Directors following the next annual
meeting of stockholders and until their successors have been elected and
qualified.
Neither Ms. Myers or Ms. Wright hold directorships in any other reporting
company.
No Executive Officer or Director of the Corporation has been the subject of any
Order, Judgement, or Decree of any Court of competent jurisdiction, of any
regulatory agency enjoining him from acting as an investment advisor,
underwriter, broker or dealer in the securities industry, or as an affiliated
person, director or employee of an investment company, bank, savings and loan
association, or insurance company or from engaging in or continuing any conduct
or practice in connection with any such activity or in connection with the
purchase or sale of any securities nor has any such person been the subject of
any Order of a State authority barring or suspending for more than sixty (60)
days, the right of such a person to be engaged in such activities or to be
associated with such activities.
6
<PAGE> 7
No Executive Officer or Director of the Corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending.
No Executive Officer or Director of the Corporation is the subject of any
pending legal proceedings.
Resumes
Ann Myers, President, Secretary & Director
<TABLE>
<S> <C>
1991 - Current Independent contractor providing Management Information Services consulting
for service and medical manufacturing businesses, responsibilities include all
data processing, billings, review and selection of applications software.
1982 - 1991 Manager - Data Processing Services for manufacturing firms
1957 -1978 Manager - California Department of Motor Vehicles
</TABLE>
Jill Wright, Treasurer & Director
<TABLE>
<S> <C>
1996 - Current Independent consultant to long term health care and assisted living facilities in
San Diego. Current California Administrator's License in Assisted Living.
1993 - 1996 Pacific Regent of La Jolla, Director of Marketing.
1990 - 1993 Mercy Rehabilitation and Care Center, Director of Social Services.
Prior Director of Recreation Therapy - clinical psychiatric
setting, administered and managed handicapped and
special population programs in various San Diego
health care facilities.
1973 - 1978 Assistant Professor of Recreational Therapy at San Diego State University
</TABLE>
BS and MS - Indiana University
ITEM 6
EXECUTIVE COMPENSATION
The company's current officers receive no compensation. There are no current
employment agreements between the Company and its executive officers.
There are no annuity, pension or retirement benefits proposed to be paid to
officers, directors or employees of the Corporation in the event of retirement
at normal retirement date pursuant to any presently existing plan provided or
contributed to by the Corporation or any of its subsidiaries, if any.
7
<PAGE> 8
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Other Restricted
Name & annual stock LTIP All other
principle Salary Bonus compen- awards Options Payouts compen-
position Year ($) ($) sation ($) SARs ($) sation($)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
A Myers 1996 -0- -0- -0- -0- -0- -0- -0-
President 1997 -0- -0- -0- -0- -0- -0- -0-
1998 -0- -0- -0- 1 -0- -0- -0-
J Wright 1996 -0- -0- -0- -0- -0- -0- -0-
Treasurer 1997 -0- -0- -0- -0- -0- -0- -0-
1998 -0- -0- -0- 1 -0- -0- -0-
</TABLE>
The Directors and Principal Officers have worked with no remuneration until such
time as the Company receives sufficient revenues necessary to provide proper
salaries to all Officers and compensation for Directors' participation. The
Officers and the Board of Directors have the responsibility to determine the
timing of remuneration based upon a positive cash flow to include stock sales,
product sales, estimated cash expenditures, accounts receivable, accounts
payable, notes payable, and a cash balance of not less than $10,000 at each
month end. At this time, management cannot accurately estimate when sufficient
revenues will occur to implement this compensation.
ITEM 7
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Ms. Myers (Director, President & Secretary) received 50,000 shares of the
Company's common stock in 1994 for services, another 50,000 shares were issued
to her for services in February 1998. 4,400,000 shares of the Company's common
stock were issued to her per a 45 for 1 forward stock split on February 28,
1998.
Ms. Wright (Director & Treasurer) received 50,000 shares of the Company's common
stock in 1994 for services, another 50,000 shares were issued to her for
services in February 1998. 4,400,000 shares of the Company's common stock were
issued to her per a 45 for 1 forward stock split on February 28, 1998.
ITEM 8
DESCRIPTION OF SECURITIES
The Company's Certificate of Incorporation authorizes the issuance of 25,000,000
Shares of Common Stock, .001 par value per share. There is no preferred stock
authorized. Holders of shares of
8
<PAGE> 9
Common Stock are entitled to one vote for each share on all matters to be voted
on by the stockholders. Holders of Common Stock have cumulative voting rights.
Holders of shares of Common Stock are entitled to share ratable in dividends, if
any, as may be declared, from time to time by the Board of Directors in its
discretion, from funds legally available therefor. In the event of a
liquidation, dissolution, or winding up of the Company, the holders of shares of
Common Stock are entitled to share pro rata all assets remaining after payment
in full of all liabilities. Holders of Common Stock have no preemptive or other
subscription rights, and there are no conversion rights or redemption or sinking
fund provisions with respect to such shares. All of the outstanding Common Stock
is, and the shares offered by the Company pursuant to this offering will be,
when issued and delivered, fully paid and non-assessable.
PART II
ITEM 1
MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND OTHER
SHAREHOLDER MATTERS
The Company, upon approval of the SEC, will file for trading on the OTC
Electronic Bulletin Board which is sponsored by the National Association of
Securities Dealers (NASD). The OTC Electronic Bulletin Board is a network of
security dealers who buy and sell stock. The dealers are connected by a computer
network which provides information on current "bids" and "asks" as well as
volume information.
As of the date of this filing, there is no public market for the Company's
securities. As of January 31, 1999, the Company had 37 shareholders of record.
The Company has paid no cash dividends. The Company has no outstanding options.
The Company has no plans to register any of its securities under the Securities
Act for sale by security holders. There is no public offering of equity and
there is no proposed public offering of equity.
ITEM 2
LEGAL PROCEEDINGS
The Company is not currently involved in any legal proceedings and is not aware
of any pending or potential legal actions.
ITEM 3
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING CONTROL AND
FINANCIAL DISCLOSURE
None.
9
<PAGE> 10
ITEM 4
RECENT SALES OF UNREGISTERED SECURITIES
On June 14, 1994, at a special meeting of the board of directors, the
shareholders authorized the issuance of 50,000 shares of common stock to each of
the officers and directors of the Company for a total of 100,000 Rule 144
shares. The Company relied upon Section 4(2) of Securities Act of 1993, as
amended (the "Act"). The Company issued the shares in satisfaction of management
services rendered to officers and directors, which does not constitute a public
offering.
From the period of approximately July 1, 1995 until July 31, 1995, the Company
offered and sold 37,000 shares at $.10 per share to non-affiliated private
investors. The Company relied upon Section 4(2) of the Securities Act of 1993,
as amended (the "Act"). Each prospective investor was given a private placement
memorandum designed to disclose all material aspects of an investment in the
Company. This offering was not accompanied by general advertisement or general
solicitation, the shares were bought by the investors for their own accounts
with investment intent. The shares were issued with a Rule 144 restrictive
legend.
On February 28, 1998, the Board of Directors authorized the issuance of 50,000
shares of common stock to each of the officers and directors of the Company. The
Company relied upon Section 4(2) of Securities Act of 1993, as amended (the
"Act") for this issuance. The Company issued the shares in satisfaction of
management services rendered to officers and directors, which does not
constitute a public offering. A forward stock split of 45 for 1 was also
authorized, resulting in a total of 10,665,000 shares of common stock issued and
outstanding.
ITEM 5
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's By-Laws allow for the indemnification of Company Officers and
Directors in regard to their carrying out the duties of their offices. The
By-Laws also allow for reimbursement of certain legal defenses.
As to indemnification for liabilities arising under the Securities Act of 1933
for directors, officers or persons controlling the Company, the Company has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy and unenforceable.
PART F/S
The audited financial statements of the Company and related notes which are
included in this offering have been examined by Barry L. Friedman, PC, and have
been so included in reliance upon the opinion of such accountants given upon
their authority as an expert in auditing and accounting.
10
<PAGE> 11
PART III
EXHIBITS
<TABLE>
<CAPTION>
<S> <C> <C>
Exhibit A Financial Statements
1 Audited financial statements for the year ended
March 31, 1997 and the year ended March 31, 1998 and
for the period ended November 30, 1998
2 Interim financial statements for the ten months
ended January 31, 1999 and 1998
Exhibit 2 Plan of acquisition, reorganization or liquidation None
Exhibit 3(i) Articles of Incorporation Included in Original Filing
Exhibit 3(ii) Bylaws Included in Original Filing
Exhibit 4 Instruments defining the rights of holders None
Exhibit 7 Opinion re: liquidation preference None
Exhibit 9 Voting Trust Agreement None
Exhibit 10 Material contracts None
Exhibit 11 Statement re: computation of per share earnings See Exhibit A
Exhibit 14 Material foreign patents None
Exhibit 16 Letter on change of certifying accountant None
Exhibit 21 Subsidiaries of the registrant None
Exhibit 23 Consent of experts and counsel Included
Exhibit 24 Power of Attorney None
Exhibit 27 Financial Data Schedule Included
Exhibit 28 Reports furnished to State insurance agencies None
</TABLE>
SIGNATURES
In accordance with Section 12 of the Securities and Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
Shanecy, Inc.
Date 5/20/99 By /s/ Ann Myers
---------------------------- -------------------------------------
Ann Myers, President & Director
Date 5/20/99 By /s/ Jill Wright
---------------------------- -------------------------------------
Jill Wright, Treasurer & Director
11
<PAGE> 12
Exhibit A
12
<PAGE> 13
SHANECY, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
NOVEMBER 30, 1998
MARCH 31, 1998
MARCH 31, 1997
<PAGE> 14
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE #
------
<S> <C>
INDEPENDENT AUDITORS REPORT .............................................1
ASSETS ..................................................................2
LIABILITIES AND STOCKHOLDERS EQUITY .....................................3
STATEMENT OF OPERATIONS .................................................4
STATEMENT OF STOCKHOLDERS EQUITY ........................................5
STATEMENT OF CASH FLOWS .................................................6
NOTES TO FINANCIAL STATEMENTS ...........................................7-10
</TABLE>
<PAGE> 15
BARRY L. FRIEDMAN, P.C.
Certified Public Accountant
1582 TULITA DRIVE OFFICE (702) 361-8414
LAS VEGAS, NEVADA 89123 FAX NO. (702) 896-0278
INDEPENDENT AUDITORS' REPORT
Board of Directors December 11, 1998
Shanecy, Inc.
San Diego, California
I have audited the accompanying Balance Sheets of Shanecy, Inc., (A
Development Stage Company), as of November 30, 1998, March 31, 1998, and March
31, 1997, and the related statements of operations, stockholders' equity and
cash flows for the period April 1, 1998, to November 30, 1998, the two years
ended March 31, 1998, and March 31, 1997, and the period May 31, 1994
(inception) to November 30, 1998. These financial statements are the
responsibility of the Company's management. My responsibility is to express an
opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Shanecy, Inc., (A
Development Stage Company), as of November 30, 1998, March 31, 1998, and March
31, 1997, and the related statements of operations, stockholders' equity and
cash flows for the period April 1, 1998, to November 30, 1998, the two years
ended March 31, 1998, and March 31, 1997, and the period May 31, 1994
(inception) to November 30, 1998, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note #5 to the
financial statements, the Company has no established source of revenue. This
raises substantial doubt about its ability to continue as a going concern.
Management's plan in regard to these matters are also described in Note #5. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
- --------------------------
Barry L. Friedman
Certified Public Accountant
<PAGE> 16
SHANECY, INC.
(A Development Stage Company)
BALANCE SHEET
ASSETS
<TABLE>
<CAPTION>
November March March
30, 1998 31, 1998 31, 1997
-------- -------- -------
<S> <C> <C> <C>
CURRENT ASSETS:
Cash $3,700 $3,700 $3,700
------ ------ ------
TOTAL CURRENT ASSETS $3,700 $3,700 $3,700
------ ------ ------
OTHER ASSETS: $ 0 $ 0 $ 0
------ ------ ------
TOTAL OTHER ASSETS $ 0 $ 0 $ 0
------ ------ ------
TOTAL ASSETS $3,700 $3,700 $3,700
====== ====== ======
</TABLE>
See accompanying notes to financial statements & audit report
-2-
<PAGE> 17
SHANECY, INC.
(A Development Stage Company)
BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
November March March
30, 1998 31, 1998 31, 1997
-------- -------- --------
<S> <C> <C> <C>
CURRENT LIABILITIES: $ 0 $ 0 $ 0
-------- -------- --------
TOTAL CURRENT LIABILITIES $ 0 $ 0 $ 0
-------- -------- --------
STOCKHOLDERS' EQUITY:
Common stock, $0.00001 par value,
authorized 20,000,000 shares;
issued and outstanding at
March 31, 1997-137,000 shares $ 2
Common stock, $0.001 par value
authorized 20,000,000 shares
issued and outstanding at
March 31, 1998-10,665,000 shares $ 10,665
November 30, 1998-10,665,000 shs $ 10,665
Additional paid-in capital (6,963) (6,963) 3,699
Deficit accumulated during
development stage (2) (2) (1)
-------- -------- --------
TOTAL STOCKHOLDER'S EQUITY $ 3,700 $ 3,700 $ 3,700
-------- -------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 3,700 $ 3,700 $ 3,700
======== ======== ========
</TABLE>
See accompanying notes to financial statements & audit report
-3-
<PAGE> 18
SHANECY, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
April 1, Year Year May 31, 1994
1998 to Ended Ended (inception)
Nov. 30, March 31, March 31, to Nov. 30,
1998 1998 1997 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCOME:
Revenue $ 0 $ 0 $ 0 $ 0
------------ ------------ ------------ ------------
EXPENSES:
General, Selling
and Administrative $ 0 $ 1 $ 0 $ 2
------------ ------------ ------------ ------------
Total Expenses $ 0 $ 1 $ 0 $ 2
Net Profit/Loss $ 0 $ (1) $ 0 $ (2)
============ ============ ============ ============
Net Profit/Loss
per weighted
share (Note 2) $ 00 $ NIL $ 00 $ NIL
============ ============ ============ ============
Weighted average
number of common
shares outstanding 10,665,000 10,665,000 10,665,000 10,665,000
============ ============ ============ ============
</TABLE>
See accompanying notes to financial statements & audit report
-4-
<PAGE> 19
SHANECY, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Additional
Common Stock paid-in Retained
Shares Amount capital Earnings
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Balance,
March 31, 1996 137,000 $ 2 $ 3,699 $ (1)
Net loss year ended
March 31, 1997 0
---------- ---------- ---------- ----------
Balance, March 31, 1997 137,000 $ 2 $ 3,699 $ (1)
February 28, 1998
stock issued for services 10 $ 1 $ 0
February 28, 1998
forward stock split 45:1 10,428,000 $ 104 $ (104)
Net loss year ended
March 31, 1998 $ (1)
---------- ---------- ---------- ----------
Balance, March 31, 1998 10,665,000 $ 107 $ 3,595 $ (2)
7-Oct-98
chngd par value .00001 to .001 $ 10,558 $ (10,558)
Net loss
April 1, 1998 to
November 30, 1998 $ 0
---------- ---------- ---------- ----------
Balance, November 30, 1998 10,665,000 $ 10,665 $ (6,963) $ (2)
========== ========== ========== ==========
</TABLE>
See accompanying notes to financial statements & audit report
-5-
<PAGE> 20
SHANECY, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
April 1, Year Year May 31, 1994
1998 to Ended Ended (inception)
Nov. 30, March 31, March 31, to Nov. 30,
1998 1998 1997 1998
-------- --------- --------- ------------
<S> <C> <C> <C> <C>
Cash Flows from
Operating Activities:
Net Loss $ 0 $ (1) $ 0 $ (2)
Adjustment to
reconcile net loss
to net cash
provided by operating
activities 0 0 0 0
Changes in assets and
liabilities:
Increase in current
liabilities:
Officers Advances 0 0 0 0
------- ------- ------- -------
Net cash used in
operating activities $ 0 $ (1) $ 0 $ (2)
Cash Flows from
investing activities 0 0 0 0
Cash Flows from
Financing Activities:
Issuance of common
stock for services 0,000 $ 1 0,000 $ 2
stock for cash 0 0 0 $ 3,700
------- ------- ------- -------
Net increase (decrease)
in cash $ 0 $ 0 $ 0 $ 3,700
Cash,
beginning of period $ 3,700 $ 3,700 $ 3,700 $ 0
------- ------- ------- -------
Cash, end of period $ 3,700 $ 3,700 $ 3,700 $ 3,700
======= ======= ======= =======
</TABLE>
See accompanying notes to financial statements & audit report
-6-
<PAGE> 21
SHANECY, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
November 30, 1998, March 31, 1998, and March 31, 1997
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized May 31, 1994, under the laws of the State of Delaware
as Shanecy, Inc. The Company currently has no operations and, in accordance with
SFAS #7, is considered a development company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.
Cash and equivalents
The Company maintains a cash balance in a non-interest bearing bank that
currently does not exceed federally insured limits. For the purpose of the
statements of cash flows, all highly liquid investments with the maturity of
three months or less are considered to be cash equivalents. There are no cash
equivalents as of November 30, 1998.
Income Taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS #109)
"Accounting for Income Taxes." A deferred tax asset or liability is recorded for
all temporary difference between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of deferred tax
assets and liabilities.
Organization Costs
Costs incurred to organize the Company were amortized on a straight-line basis
over a sixty month period.
-7-
<PAGE> 22
SHANECY, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS - Continued
November 30, 1998, March 31, 1998, and March 31, 1997
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
Loss Per Share
Net loss per share is provided in accordance with Statement of Financial
Accounting Standards No. 128 (SFAS #128) "Earnings Per Share". Basic loss per
share is computed by dividing losses available to common stockholders by the
weighted average number of common shares outstanding during the period. Diluted
loss per share reflects per share amounts that would have resulted if dilative
common stock equivalents had been converted to common stock. As of November 30,
1998, the Company had no dilative common stock equivalents such as stock
options.
Year End
The Company has selected March 31st, as its fiscal year end.
Year 2000 Disclosure
Computer programs that have time sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in a system
failure or miscalculations causing disruption of normal business activities.
The Company's potential software suppliers have verified they will provide only
certified Year 2000 compatible software for all of its computing requirements.
Because the Company's products and services are sold to the general public, with
no major customers, the Company believes the Year 2000 issue will not pose
significant operational problems and will not materially affect future financial
results.
Policy in Regards to Issuance of Common Stock in a Non-Cash Transaction
The Company's accounting policy for issuing shares in a non-cash transaction is
to issue the equivalent amount of stock equal to the fair market value of the
assets or services received.
-8-
<PAGE> 23
SHANECY, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS Continued
November 30, 1998, March 31, 1998, and March 31, 1997
NOTE 3 - INCOME TAXES
There is no provision for income taxes for the period ended November 30, 1998,
due to the net loss and no state income tax in the state of the Company's
domicile and operations. The Company's total deferred tax asset as of March 31,
1998, is as follows:
<TABLE>
<S> <C>
Net operation loss carry forward $200
Valuation allowance 200
----
Net deferred tax asset $ 0
</TABLE>
The federal net operation loss carry forward will expire between 2014 and 2018.
This carry forward may be limited upon the consummation of a business
combination under IRC Section 381.
NOTE 4 - SHAREHOLDERS' EQUITY
Common Stock
The authorized common stock of Shanecy, Inc. consists of 20,000,000 shares with
a par value of $.001 per share.
Preferred Stock
Shanecy, Inc. has no preferred stock.
On June 14, 1994, the Company issued 100,000 shares of its $0.00001 par
value stock for services of $100.00 to its directors. Fifty thousand (50,000)
shares to each of the two directors.
On July 31, 1995, the Company issued 37,000 shares of its $0.00001 par
value stock for cash of $3,700.00.
On February 28, 1998, the Company issued 100,000 shares of its $0.00001
par value stock for services of $100.00 to its directors. Fifty thousand
(50,000) shares to each of the two directors.
On February 28, 1998, the Company approved a forward stock split on the
basis of 45:1 thus increasing the outstanding common stock from 237,000 shares
to 10,665,000 shares.
On October 7, 1998, the State of Delaware approved the Company's
restated Articles of Incorporation, which changed the par value from $0.00001 to
$0.001.
-9-
<PAGE> 24
SHANECY, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS Continued
November 30, 1998, March 31, 1998, and March 31, 1997
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company does not have significant cash or other material
assets, nor does it have an established source of revenues sufficient to cover
its operating costs and to allow it to continue as a going concern. The
stockholders/officers and or directors have committed to advancing the operating
costs of the Company interest free.
NOTE 6 - RELATED PARTY TRANSACTIONS
The Company neither owns or leases any real or personal property. Office
services are provided without charge by an officer. Such costs are immaterial to
the financial statements and accordingly, have not been reflected therein. The
officers and directors of the Company are involved in other business activities
and may, in the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business interests.
The Company has not formulated a policy for the resolution of such conflicts.
NOTE 7 - WARRANTS AND OPTIONS
There are no warrants of options outstanding to acquire any additional shares of
common stock.
-10-
<PAGE> 25
SHANECY, INC.
(A Development Stage Company)
INTERIM FINANCIAL STATEMENTS
JANUARY 31, 1999
JANUARY 31, 1998
<PAGE> 26
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE #
------
<S> <C>
ASSETS ...............................................................1
LIABILITIES AND STOCKHOLDERS EQUITY ..................................1
STATEMENT OF OPERATIONS ..............................................2
STATEMENT OF CASH FLOWS ..............................................3
NOTES TO FINANCIAL STATEMENTS ........................................4 - 5
</TABLE>
<PAGE> 27
SHANECY, INC.
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
JANUARY 31 JANUARY 31
1999 1998
---------- ----------
<S> <C> <C>
CURRENT ASSETS
CASH 463.85 3,700.00
---------- ----------
TOTAL CURRENT ASSETS 463.85 3,700.00
FIXED ASSETS
---------- ----------
NET FIXED ASSETS 0.00 0.00
OTHER ASSETS
ORGANIZATION COSTS
LESS AMORTIZATION
---------- ----------
TOTAL OTHER ASSETS 0.00 0.00
---------- ----------
TOTAL ASSETS 463.85 3,700.00
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
---------- ----------
TOTAL CURRENT LIABILITIES 0.00 0.00
LONG TERM LIABILITIES
---------- ----------
TOTAL LONG TERM LIABILITIES 0.00 0.00
---------- ----------
TOTAL LIABILITIES 0.00 0.00
STOCKHOLDERS' EQUITY
COMMON STOCK 10,665.00 2.00
PAID IN CAPITAL (6,963.00) 3,699.00
BEGINNING RETAINED EARNINGS (2.00) (1.00)
NET INCOME (LOSS) (3,236.15) 0.00
---------- ----------
ENDING RETAINED EARNINGS (3,238.15) (1.00)
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 463.85 3,700.00
---------- ----------
TOTAL LIAB & STOCKHOLDERS' EQUITY 463.85 3,700.00
========== ==========
</TABLE>
<PAGE> 28
SHANECY, INC.
INCOME STATEMENTS
FOR THE TEN MONTHS ENDED
<TABLE>
<CAPTION>
JANUARY 31 JANUARY 31
1999 1998
---------- ----------
<S> <C> <C>
REVENUE
---------- ----------
TOTAL REVENUE 0.00 0.00
DIRECT COSTS
---------- ----------
TOTAL COST OF GOODS SOLD 0.00 0.00
---------- ----------
GROSS PROFIT 0.00 0.00
OPERATING EXPENSES
LICENSES & FEES 880.00
OFFICE EXPENSE 56.15
TRANSFER AGENT 500.00
ACCOUNTANT 1,800.00
---------- ----------
TOTAL OPERATING EXPENSES 3,236.15 0.00
---------- ----------
INCOME FROM OPERATIONS (3,236.15) 0.00
OTHER INCOME & EXPENSE
---------- ----------
TOTAL OTHER INCOME & EXPENSE 0.00 0.00
---------- ----------
INCOME BEFORE TAXES (3,236.15) 0.00
PROVISION FOR TAXES
---------- ----------
NET INCOME (3,236.15) 0.00
========== ==========
</TABLE>
<PAGE> 29
INCOME STATEMENTS
STATEMENTS OF CASH FLOWS
FOR THE TEN MONTHS ENDED
<TABLE>
<CAPTION>
JANUARY 31 JANUARY 31
1999 1998
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
NET LOSS (3,236.15) 0.00
ADJ TO RECONCILE NET INCOME (LOSS) TO NET
CASH USED IN OPERATING ACTIVITIES
---------- ----------
NET CASH FLOWS FROM OPERATING ACTIVITIES (3,236.15) 0.00
---------- ----------
NET INCREASE (DECREASE) (3,236.15) 0.00
CASH AT BEGINNING OF PERIOD 3,700.00 3,700.00
CASH AT END OF PERIOD 463.85 3,700.00
</TABLE>
<PAGE> 30
SHANECY, INC.
NOTES TO FINANCIAL STATEMENTS
1. MANAGEMENT'S OPINION
In the opinion of management, the accompanying financial statements contain all
adjustments necessary to present fairly the financial position of the company as
of January 31, 1999 and 1998 and the results of operations for the ten months
ended January 31, 1999 and 1998 and changes in cash for the ten months ended
January 31, 1999 and 1998.
2. INTERIM REPORTING
The results of operations for the ten months ended January 31, 1999 and 1998 are
not necessarily indicative of the results to be expected for the remainder of
the year.
3. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Nature of Operations
The Company was incorporated in Delaware on May 31, 1994. The Company was
organized in order to develop a home care analysis and referral service for use
by consumers and patients who utilize home health care service providers. The
Company is a development stage company and has not conducted any business
activities to date.
Basis of Accounting
The Company's policy is to use the accrual method of accounting and to prepare
and present financial statements which conform to generally accepted accounting
principles. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
periods. Actual results could differ from those estimates.
Cash and equivalents
For purpose of the statements of cash flows, all highly liquid investments with
a maturity of three months or less are considered to be cash equivalents. There
were no cash equivalents as of January 31, 1999 and 1998.
<PAGE> 31
NOTES TO FINANCIAL STATEMENTS (continued)
Income Taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS 109),
"Accounting for Income Taxes." A deferred tax asset or liability is recorded for
all temporary differences between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of deferred tax
assets and liabilities.
4. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
OPERATIONS
Material changes in financial condition
As of January 31, 1999 the Company had $464 of cash in the bank compared to
$3,700 of cash in the bank as of January 31, 1998. The Company had no cash
receipts for the ten months ended January 31, 1999. The primary uses of cash
during the ten months ended January 31, 1999 were $2,300 for professional fees,
and $880 for licenses and fees.
Material changes in the results of operations
Expenses of $3,236 for the ten months ended January 31, 1999 were primarily for
preparing the Company's legal documents and audit in anticipation of securing
private placement capital in 1999. Management believes that the economic growth
in the home health care services industry provides the Company with a compelling
reason to complete its business plan in order to successfully market its home
health care analysis and referral services.
<PAGE> 1
BARRY L. FRIEDMAN, P.C.
Certified Public Accountant
1582 TULITA DRIVE OFFICE (702) 361-8414
LAS VEGAS, NEVADA 89123 FAX NO. (702) 896-0278
To Whom It May Concern: December 11, 1998
The firm of Barry L. Friedman, P.C., Certified Public Accountant
consents to the inclusion of their report of December 11, 1998, on the Financial
Statements of SHANECY, INC., as of November 30, 1998, in any filings that are
necessary now or in the near future with the U.S. Securities and Exchange
Commission.
Very truly yours,
- ----------------------------
Barry L. Friedman
Certified Public Accountant
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM INTERIM
FINANCIAL STATEMENTS FOR THE PERIODS ENDING JANUARY 31, 1999 AND JANUARY 31,
1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH SHANECY, INC.
AMENDED 10-SB.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> OTHER OTHER
<FISCAL-YEAR-END> MAR-31-1999 MAR-31-1998
<PERIOD-START> APR-01-1998 APR-01-1997
<PERIOD-END> JAN-31-1999 JAN-31-1998
<CASH> 464 3,700
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 464 3,700
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 464 3,700
<CURRENT-LIABILITIES> 0 0
<BONDS> 0 0
0 0
0 0
<COMMON> 10,665 2
<OTHER-SE> (6,963) 3,699
<TOTAL-LIABILITY-AND-EQUITY> 464 3,700
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 3,236 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (3,236) 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (3,236) 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (3,236) 0
<EPS-PRIMARY> 0.00 0.00
<EPS-DILUTED> 0.00 0.00
</TABLE>
