UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 2000
[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period to
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Commission File Number 333-37198
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UNITED MANGEMENT, INC.
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(Exact name of small Business Issuer as specified in its charter)
Nevada 98-0204736
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(State or other jurisdiction of (IRS Employer Identification No.)
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incorporation or organization)
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#676, 141 - 757 West Hastings Street
Vancouver, BC V6C 1A1
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(Address of principal executive offices) (Postal or Zip Code)
Issuer's telephone number, including area code: 604-681-7806
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None
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(Former name, former address and former fiscal year, if changed since
last report)
Check whether the issuer (1) 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 issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days [X] Yes [ ] No
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 500,000 Shares of $0.0001 par value
Common Stock outstanding as of September 30, 2000.
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-QSB and Item 310 (b) of Regulation S-B, and,
therefore, do not include all information and footnotes necessary for a complete
presentation of financial position, results of operations, cash flows, and
stockholders' equity in conformity with generally accepted accounting
principles. In the opinion of management, all adjustments considered necessary
for a fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring nature.
Operating results for the three months ended September 30, 2000 are not
necessarily indicative of the results that can be expected for the year ending
June 30, 2001.
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Stated in U.S. Dollars)
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
BALANCE SHEET
(Stated in U.S. Dollars)
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SEPTEMBER 30 JUNE 30
2000 2000
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ASSETS $ - $ -
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LIABILITIES
Current
Accounts payable and accrued liabilities $ 1,699 $ 3,235
Loans payable 10,790 -
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12,489 3,235
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SHAREHOLDERS' DEFICIENCY
Share Capital
Authorized:
100,000,000 common shares, par value
$0.0001 per share
Issued and outstanding:
500,000 common shares 50 50
Additional paid in capital 15,670 15,670
Deficit (28,209) (18,955)
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(12,489) (3,235)
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$ - $ -
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<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS AND DEFICIT
(Stated in U.S. Dollars)
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INCEPTION
JANUARY 29
THREE MONTHS ENDED 1997 TO
SEPTEMBER 30 SEPTEMBER 30
2000 1999 2000
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Expenses
Office and sundry $ 2,127 $ 2,415 $ 8,755
Professional fees 7,127 3,487 19,404
Stock based compensation for
organizational costs - - 50
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Net Loss For The Period 9,254 5,902 $ 28,209
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Deficit, Beginning Of Period 18,955 50
Deficit, End Of Period $ 28,209 $ 5,952
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Net Loss Per Share $ (0.02) $ (0.01)
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Weighted Average Number Of Shares
Outstanding 500,000 500,000
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<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
(Stated in U.S. Dollars)
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INCEPTION
JANUARY 29
THREE MONTHS ENDED 1997 TO
SEPTEMBER 30 SEPTEMBER 30
2000 1999 2000
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Cash Flow From Operating Activities
Net loss for the period $ (9,254) $ (5,902) $(28,209)
Non-cash transactions:
Stock-based compensation
for organizational costs - - 50
Third party expenses paid by
affiliate on behalf of the
Company, recorded as
additional paid-in capital - - 15,670
Adjustments To Reconcile Net
Loss To Net Cash Used By
Operating Activities
Accounts payable and accrued
liabilities (1,536) 4,214 1,699
Loans payable 10,790 1,688 10,790
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- - -
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Change In Cash - - -
Cash, Beginning Of Period - - -
Cash, End Of Period $ - $ - $ -
================================================================================
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
STATEMENT OF SHAREHOLDERS EQUITY
(Stated in U.S. Dollars)
<TABLE>
<CAPTION>
ADDITIONAL
PAID-IN
SHARES AMOUNT CAPITAL DEFICIT TOTAL
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<S> <C> <C> <C> <C> <C>
Shares Issued For Cash At $0.0001 500,000 $ 50 $ - $ (50) $ -
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Balance, June 30, 1997 And 1998 500,000 50 - (50) -
Loss For The Year - - - (1,973) (1,973)
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Balance, June 30, 1999 500,000 50 - (2,023) (1,973)
Third Party Expenses Paid By
Affiliate On Behalf Of The Company,
Recorded As Additional Paid-In
Capital - - 15,670 - 15,670
Loss For The Year - - - (16,932) (16,932)
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Balance, June 30, 2000 500,000 50 15,670 (18,955) (3,235)
Loss For The Period - - - (9,254) (9,254)
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Balance, September 30, 2000 500,000 $ 50 $ 15,670 $ (28,209) $( 12,489)
=============================================================
</TABLE>
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Stated in U.S. Dollars)
1. BASIS OF PRESENTATION
The unaudited financial statements as of September 30, 2000 included herein have
been prepared without audit pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with United States generally accepted principles have been condensed or omitted
pursuant to such rules and regulations. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. It is suggested that these financial
statements be read in conjunction with the June 30, 2000 audited financial
statements and notes thereto.
2. NATURE OF OPERATIONS
a) Organization
The Company was incorporated in the State of Nevada, U.S.A. on January 29, 1997.
b) Development Stage Activities
The Company has been in the development stage since inception and has no
operations to date.
3. SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States. Because a
precise determination of many assets and liabilities is dependent upon future
events, the preparation of financial statements for a period necessarily
involves the use of estimates which have been made using careful judgement.
The financial statements have, in management's opinion, been properly prepared
within reasonable limits of materiality and within the framework of the
significant accounting policies summarized below:
a) Development Stage Company
The Company is a developed stage company as defined in the Statements of
Financial Accounting Standards No. 7. The Company is devoting substantially all
of its present efforts to establish a new business and none of its planned
principal operations have commenced. All losses accumulated since inception
have been considered as part of the Company's development stage activities.
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Stated in U.S. Dollars)
3. SIGNIFICANT ACCOUNTING POLICIES (Continued)
b) Income Taxes
The Company has adopted Statement of Financial Accounting Standards No. 109 -
"Accounting for Income Taxes" (SFAS 109). This standard requires the use of an
asset and liability approach for financial accounting and reporting on income
taxes. If it is more likely than not that some portion or all if a deferred tax
asset will not be realized, a valuation allowance is recognized.
c) Financial Instruments
The Company's financial instruments consist of accounts payable.
Unless otherwise noted, it is management's opinion that this Company is not
exposed to significant interest or credit risks arising from these financial
instruments. The fair value of these financial instruments approximate their
carrying values, unless otherwise noted.
d) Net Loss Per Share
Net loss per share is based on the weighted average number of common shares
outstanding during the period plus common share equivalents, such as options,
warrants and certain convertible securities. This method requires primary
earnings per share to be computed as if the common share equivalents were
exercised at the beginning of the period or at the date of issue and as if the
funds obtained thereby were used to purchase common shares of the Company at its
average market value during the period.
4. NEW ACCOUNTING STANDARDS
a) Effective December 15, 1995, Statement of Financial Accounting Standards
No. 123 ("SFAS-123") "Accounting for Stock-based Compensation" was adopted for
United States GAAP purposes. SFAS-123 enables a company to elect to adopt a
fair value methodology for accounting for stock based compensation. The Company
has determined that the fair value of stock options is similar to the issue
price at the time of granting. The Company does not expect to elect to adopt
the fair value methodology, although the pro forma results of operations and
earnings per share determined as if the fair value methodology had been applied
will be disclosed as required under SFAS-123 in future years.
<PAGE>
UNITED MANAGEMENT, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Stated in U.S. Dollars)
4. NEW ACCOUNTING STANDARDS (Continued)
b) In March, 1995, Statement of Financial Accounting Standards No. 121
(SFAS-121) "Accounting for Impairment of long-lived assets and for long-lived
assets to be disposed of" was issued. Certain long-lived assets held by the
Company must be reviewed for impairment whenever events or changes in
circumstances indicate the carrying amount of an asset may not be recoverable.
Accordingly, the impairment loss is recognized in the period it is determined.
The Company has adopted these standards. There was no material effect on its
financial position or results of operations of the Company from its adoption.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
We intend to seek to acquire assets or shares of an entity actively engaged in a
business that generates revenues, in exchange for its securities. We have not
identified a particular acquisition target and have not entered into any
negotiations regarding an acquisition. As soon as this registration statements
becomes effective under Section 12 of the '34 Act, we intend to contact
investment bankers, corporate financial analysts, attorneys and other investment
industry professionals through various media. None of our officers, directors,
promoters or affiliates have engaged in any preliminary contact or discussions
with any representative of any other company regarding the possibility of an
acquisition or merger with us as of the date of this registration statement.
Depending upon the nature of the relevant business opportunity and the
applicable state statutes governing how the transaction is structured, the
Company's Board of Directors expects that it will provide our shareholders with
complete disclosure documentation concerning a potential business opportunity,
and the structure of the proposed business combination prior to consummation.
Disclosure is expected to be in the form of a proxy or information statement, in
addition to the post-effective amendment.
While any disclosure must include audited financial statements of the target
entity, we cannot assure you that such audited financial statements will be
available. As part of the negotiation process, the Board of Directors does
intend to obtain certain assurances of value, including statements of assets and
liabilities, material contracts, accounts receivable statements, or other
indicia of the target entity's condition prior to consummating a transaction,
with further assurances that an audited statement would be provided prior to
execution of a merger or acquisition agreement. Closing documents will include
representations that the value of the assets transferred will not materially
differ from the representations included in the closing documents, or the
transaction will be voidable.
Due to our intent to remain a shell corporation until a merger or acquisition
candidate is identified, it is anticipated that its cash requirements shall be
minimal, and that all necessary capital, to the extent required, will be
provided by the directors or officers. We do not anticipate that we will have
to raise capital in the next twelve months. We also do not expect to acquire
any plant or significant equipment.
We have not, and do not intend to enter into, any arrangement, agreement or
understanding with non-management shareholders allowing non-management
shareholders to directly or indirectly participate in or influence our
management of the Company. Management currently holds 60.8% of our stock. As a
result, management is in a position to elect a majority of the directors and to
control our affairs.
We have no full time employees. Our President and Secretary have agreed to
allocate a portion of their time to our activities, without compensation. These
officers anticipate that our business plan can be implemented by their devoting
approximately five (5) hours each per month to our business affairs and,
consequently, conflicts of interest may arise with respect to their limited time
commitment. We do not expect any significant changes in the number of
employees. See "Management".
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
(Continued)
Our officers and directors may become involved with other companies who have a
business purpose similar to ours. As a result, potential conflicts of interest
may arise in the future. If a conflict does arise and an officer or director is
presented with business opportunities under circumstances where there may be a
doubt as to whether the opportunity should belong to the Company or another
"blank check" company they are affiliated with, they will disclose the
opportunity to all the companies. If a situation arises where more than one
company desires to merge with or acquire that target company and the principals
of the proposed target company have no preference as to which company will merge
with or acquire the target company, the company that first filed a registration
statement with the Securities and Exchange Commission will be entitled to
proceed with the proposed transaction. See "Risk Factors - Affiliation With
Other "Blank Check" Companies".
General Business Plan
Our purpose is to seek, investigate and, if investigation warrants, acquire an
interest in business opportunities presented to it by persons or firms that
desire to seek the perceived advantages of an Exchange Act registered
corporation. We will not restrict our search to any specific business,
industry, or geographical location and we may participate in a business venture
of virtually any kind or nature. This discussion of the proposed business is
purposefully general and is not meant to restrict our discretion to search for
and enter into potential business opportunities. Management anticipates that it
may be able to participate in only one potential business venture because we
have nominal assets and limited financial resources. See the financial
statements at page F-1 of this prospectus. This lack of diversification should
be considered a substantial risk to our shareholders because it will not permit
us to offset potential losses from one venture against gains from another.
We may seek a business opportunity with entities that have recently commenced
operations, or that wish to utilize the public marketplace in order to raise
additional capital in order to expand into new products or markets, to develop a
new product or service, or for other corporate purposes. We may acquire assets
and establish wholly owned subsidiaries in various businesses or acquire
existing businesses as subsidiaries.
We anticipate that the selection of a business opportunity will be complex and
extremely risky. Due to general economic conditions, rapid technological
advances being made in some industries and shortages of available capital,
management believes that there are numerous firms seeking the perceived benefits
of a publicly registered corporation. The perceived benefits may include
facilitating or improving the terms for additional equity financing that may be
sought, providing liquidity for incentive stock options or similar benefits to
key employees, providing liquidity (subject to restrictions of applicable
statutes) for all shareholders and other factors. Potentially, available
business opportunities may occur in many different industries and at various
stages of development, all of which will make the task of comparative
investigation and analysis of these business opportunities extremely difficult
and complex.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
(Continued)
We have, and will continue to have, no capital to provide the owners of business
opportunities with any significant cash or other assets. However, management
believes we will be able to offer owners of acquisition candidates the
opportunity to acquire a controlling ownership interest in a publicly registered
company without incurring the cost and time required to conduct a public
offering. The owners of the business opportunities will, however, incur
significant legal and accounting costs in connection with acquisition of a
business opportunity, including the costs of preparing Form 8-K's, 10-K's or
10-KSB's, 10-Q's or 10-QSB's, agreements and related reports and documents. The
'34 Act specifically requires that any merger or acquisition candidate comply
with all applicable reporting requirements, which include providing audited
financial statements to be included within the numerous filings relevant to
complying with the '34 Act. Nevertheless, the officers and directors of the
Company have not conducted market research and are not aware of statistical data
that would support the perceived benefits of a merger or acquisition transaction
for the owners of a business opportunity.
The analysis of new business opportunities will be undertaken by our officers
and directors, none of whom is a professional business analyst. Management
intends to concentrate on identifying preliminary prospective business
opportunities that may be brought to our attention through present associations
of our officers and directors, or by our shareholders. In analyzing prospective
business opportunities, management will consider:
- the available technical, financial and managerial resources;
- working capital and other financial requirements;
- history of operations, if any;
- prospects for the future;
- nature of present and expected competition;
- the quality and experience of management services that may be available,
and the depth of that management;
- the potential for further research, development, or exploration;
- specific risk factors not now foreseeable but could be anticipated to
impact our proposed activities;
- the potential for growth or expansion;
- the potential for profit;
- the perceived public recognition of acceptance of products, services, or
trades;
- name identification; and
- other relevant factors.
Our officers and directors expect to meet personally with management and key
personnel of the business opportunity as part of their "due diligence"
investigation. To the extent possible, the Company intends to utilize written
reports and personal investigations to evaluate the above factors. We will not
acquire or merge with any company that cannot provide audited financial
statements within a reasonable period of time after closing of the proposed
transaction.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
(Continued)
Our management, while probably not especially experienced in matters relating to
the prospective new business of the Company, shall rely upon their own efforts
and, to a much lesser extent, the efforts of our shareholders, in accomplishing
our business purposes. We do not anticipate that any outside consultants or
advisors, except for our legal counsel and accountants, will be utilized by us
to accomplish our business purposes. However, if we do retain an outside
consultant or advisor, any cash fee will be paid by the prospective
merger/acquisition candidate, as we have no cash assets. We have no contracts
or agreements with any outside consultants and none are contemplated.
We will not restrict our search for any specific kind of firms, and may acquire
a venture that is in its preliminary or development stage or is already
operating. We cannot predict at this time the status of any business in which
we may become engaged, because the business may need to seek additional capital,
may desire to have its shares publicly traded, or may seek other perceived
advantages that we may offer. Furthermore, we do not intend to seek capital to
finance the operation of any acquired business opportunity until we have
successfully consummated a merger or acquisition.
We anticipate that we will incur nominal expenses in the implementation of its
business plan. Because we have no capital to pay these anticipated expenses,
present management will pay these charges with their personal funds, as interest
free loans, for a minimum of twelve months from the date of this registration
statement. If additional funding is necessary, management and or shareholders
will continue to provide capital or arrange for additional outside funding.
However, the only opportunity that management has to have these loans repaid
will be from a prospective merger or acquisition candidate. Management has no
agreements with us that would impede or prevent consummation of a proposed
transaction. We cannot assure, however, that management will continue to
provide capital indefinitely if a merger candidate cannot be found. If a merger
candidate cannot be found in a reasonable period of time, management may be
required to reconsider its business strategy, which could result in our
dissolution.
Acquisition of Opportunities
In implementing a structure for a particular business acquisition, we may become
a party to a merger, consolidation, reorganization, joint venture, or licensing
agreement with another corporation or entity. It may also acquire stock or
assets of an existing business. On the consummation of a transaction, it is
probable that our present management and shareholders will no longer be in
control. In addition, our directors may, as part of the terms of the
acquisition transaction, resign and be replaced by new directors without a vote
of our shareholders. Furthermore, management may negotiate or consent to the
purchase of all or a portion of our stock. Any terms of sale of the shares
presently held by officers and/or directors will be also afforded to all other
shareholders on similar terms and conditions. Any and all sales will only be
made in compliance with the securities laws of the United States and any
applicable state.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
(Continued)
While the actual terms of a transaction that management may not be a party to
cannot be predicted, it may be expected that the parties to the business
transaction will find it desirable to avoid the creation of a taxable event and
thereby structure the acquisition in a so-called "tax-free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In order
to obtain tax-free treatment under the Code, it may be necessary for the owners
of the acquired business to own 80% or more of the voting stock of the surviving
entity. In that event, the shareholders of the Company would retain 20% or less
of the issued and outstanding shares of the surviving entity, which would result
in significant dilution in the equity of the shareholders.
As part of the "due diligence" investigation, our officers and directors will
meet personally with management and key personnel, may visit and inspect
material facilities, obtain independent analysis of verification of certain
information provided, check references of management and key personnel, and take
other reasonable investigative measures to the extent of our limited financial
resources and management expertise. How we will participate in an opportunity
will depend on the nature of the opportunity, the respective needs and desires
of the parties, the management of the target company and our relative
negotiation strength.
With respect to any merger or acquisition, negotiations with target company
management are expected to focus on the percentage of our Company that the
target company shareholders would acquire in exchange for all of their
shareholdings in the target company. Depending upon, among other things, the
target company's assets and liabilities, our shareholders will probably hold a
substantially lesser percentage ownership interest following any merger or
acquisition. The percentage ownership may be subject to significant reduction
in the event we acquire a company with substantial assets. Any merger or
acquisition effected by us can be expected to have a significant dilutive effect
on the percentage of shares held by our then shareholders.
We will participate in a business opportunity only after the negotiation and
execution of appropriate written agreements. Although we cannot predict the
terms of the agreements, generally the agreements will require some specific
representations and warranties by all of the parties, will specify certain
events of default, will detail the terms of closing and the conditions that must
be satisfied by each of the parties prior to and after the closing, will outline
the manner of bearing costs, including costs associated with our attorneys and
accountants, will set forth remedies on default and will include miscellaneous
other terms.
As stated previously, we will not acquire or merge with any entity that cannot
provide independent audited financial statements concurrent with the closing of
the proposed transaction. We are subject to the reporting requirements of the
'34 Act. Included in these requirements is our affirmative duty to file with
the Securities and Exchange Commission upon consummation of a merger or
acquisition, as well as our audited financial statements included in our annual
report on Form 10-K (or 10-KSB, as applicable) and quarterly reports on Form
10-Q (10-QSB, as applicable). If the audited financial statements are not
available at closing, or if the audited financial statements provided do not
conform to the representations made by the candidate to be acquired in the
closing documents, the closing documents will provide that the proposed
transaction will be voidable at the discretion of our present management. If
the transaction is voided, the agreement will also contain a provision providing
for the acquisition entity to reimburse us for all costs associated with the
proposed transaction.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operations
(Continued)
Competition
We will remain an insignificant participant among the firms that engage in the
acquisition of business opportunities. There are many established venture
capital and financial concerns that have significantly greater financial and
personnel resources and technical expertise than we do. In view of our combined
extremely limited financial resources and limited management availability, we
will continue to be at a significant competitive disadvantage compared to our
competitors.
<PAGE>
PART 2 - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) None
(b) Reports on Form 8-K - None
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
UNITED MANAGEMENT, INC.
Date: November 20, 2000
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By: /s/ Christine Cerisse
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CHRISTINE CERISSE, Director and President
<PAGE>
