UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[xx] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999
Commission file Number: 000-26517
INFORETECH INC.
(FORMERLY EASTERN MANAGEMENT CORP.)
(Exact name of small business issuer as specified in its charter)
Nevada
(State or other jurisdiction of incorporation or organization)
98-0204682
(I.R.S. Employer Identification Number)
Suite 2500
1177 West Hastings Street
Vancouver, British Columbia
V6E 2K3
(Address of principal executive offices)
(604)687-0717
(Issuer's telephone number)
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 15,500,000 common shares as at
September 30, 1999
Transitional Small Business Disclosure Format (check one): Yes [ ] No [ X ]
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corp.)
INDEX
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of
September 30, 1999 and March 31, 1999
Consolidated Statements of Operations for
the periods ended September 30, 1998 and
September 30, 1999
Consolidated Statements of Cash Flows for
the periods ended September 30, 1998 and
September 30, 1999
Consolidated Statements of Changes in
Stockholders' Equity
Notes to Consolidated Financial Statements
Item 2. Plan of Operations
PART II. OTHER INFORMATION
SIGNATURES
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
BALANCE SHEETS
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
===============================================================================================================================
Audited
September 30, March 31,
1999 1999
===============================================================================================================================
<S> <C> <C>
ASSETS $ -- $ --
===============================================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT
Due to related parties $ 8,052 $ --
-------------- -------------
STOCKHOLDERS' EQUITY
Capital stock
Authorized
100,000,000 common shares with a par value of $0.0001
Issued and outstanding
15,500,000 common shares 1,550 1,550
Deficit accumulated during the development stage (9,602) (1,550)
-------------- --------------
(8,052) --
-------------- -------------
$ -- $ --
===============================================================================================================================
</TABLE>
ON BEHALF OF THE BOARD:
/s/ Jason John, Director
- ---------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
===============================================================================================================================
July 23,
1997
(inception) Three Month Three Month Six Month Six Month
to Period Ended Period Ended Period Ended Period Ended
September 30, September 30, September 30, September 30, September 30,
1999 1999 1998 1999 1998
===============================================================================================================================
<S> <C> <C> <C> <C> <C>
EXPENSES
Office and miscellaneous $ 50 $ -- $ -- $ -- $ --
Professional fees 8,052 -- -- 8,052 --
-------------- --------------- --------------- -------------- --------------
LOSS FOR THE PERIOD $ 8,102 $ -- $ -- $ 8,052 $ --
===============================================================================================================================
BASIC LOSS PER SHARE $ -- $ -- $ (0.01) $ --
===============================================================================================================================
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 15,500,000 15,500,000 15,500,000 15,500,000
===============================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
===============================================================================================================================
July 23,
1997
(Inception) Six Month Six Month
through Period Ended Period Ended
September 30, September 30, September 30,
1999 1999 1998
===============================================================================================================================
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period $ (8,102) $ (8,052) $ --
Stock issued for services 50 --
--------------- -------------- --------------
Net cash used in operating activities (8,052) (8,052) --
--------------- -------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in due to related parties 8,052 8,052 --
--------------- -------------- --------------
Net cash provided by financing activities 8,052 8,052 --
--------------- -------------- --------------
CHANGE IN CASH POSITION DURING PERIOD -- -- --
CASH POSITION, BEGINNING OF PERIOD -- -- --
--------------- -------------- --------------
CASH POSITION, END OF PERIOD $ -- $ -- $ --
===============================================================================================================================
SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS:
Cash paid for income taxes $ -- $ -- $ --
Cash paid for interest $ -- $ -- $ --
===============================================================================================================================
SUPPLEMENTAL DISCLOSURE OF NON-CASH OPERATING, INVESTING,
AND FINANCING ACTIVITIES:
Common shares issued for services $ 50 $ -- $ --
===============================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
===============================================================================================================================
Deficit
Accumulated
During
Common Stock the Total
-------------------------------- Development Stockholders'
Shares Amount Stage Equity
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCE, JULY 23, 1997 -- $ -- $ - $ --
Capital stock issued for services 15,500,000 1,550 (1,500) 50
Loss for the period -- -- (50) (50)
-------------- -------------- -------------- --------------
BALANCE, MARCH 31, 1998 AND 1999 15,500,000 1,550 (1,550) --
Loss for the period -- -- (8,052) (8,052)
-------------- -------------- -------------- --------------
BALANCE, SEPTEMBER 30, 1999 15,500,000 $ 1,550 $ (9,602) $ (8,052)
===============================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited - Prepared by Management)
FOR THE SIX MONTH PERIOD ENDED SEPTEMBER 30, 1999
================================================================================
1. ORGANIZATION OF THE COMPANY
The Company was incorporated on July 23, 1997 under the laws of Nevada
to engage in any lawful business or activity for which corporations may
be organized under the laws of the State of Nevada. On September 24,
1999, the Company changed its name to inFOREtech Inc.
The Company entered the development stage in accordance with SFAS No. 7
on July 23, 1997. Its purpose is to evaluate, structure and complete a
merger with, or acquisition of a privately owned corporation.
In the opinion of management, the accompanying financial statements
contain all adjustments necessary (consisting only of normal recurring
accruals) to present fairly the financial information contained
therein. These statements do not include all disclosures required by
generally accepted accounting principles and should be read in
conjunction with the audited financial statements of the Company for
the year ended March 31, 1999. The results of operations for the period
ended September 30, 1999 are not necessarily indicative of the results
to be expected for the year ending March 31, 2000.
2. GOING CONCERN
The Company's financial statements are prepared using the 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 has no current
source of revenue. Without realization of additional capital, it would
be unlikely for the Company to continue as a going concern. The
Company's management plans on advancing funds on an as needed basis and
in the longer term, revenues from the operations of the merger or
acquisition candidate, if found. The Company's ability to continue as a
going concern is dependent on these additional management advances,
and, ultimately, upon achieving profitable operations through a merger
or acquisition candidate.
<TABLE>
<CAPTION>
============================================================================================================
Audited
September 30, March 31,
1999 1999
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Deficit accumulated during the development stage $ (9,602) $ (1,550)
Working capital (deficiency) (8,052) --
============================================================================================================
</TABLE>
3. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues
and expenses during the period. Actual results could differ from these
estimates.
BASIC LOSS PER SHARE
Earnings per share are provided in accordance with Statement of
Financial Accounting Standards No. 128, "Earnings Per Share". Due to
the Company's simple capital structure, with only common stock
outstanding, only basic loss per share must be presented. Basic loss
per share is computed by dividing losses available to common
shareholders by the weighted average number of common shares
outstanding during the period.
<PAGE>
INFORETECH INC.
(formerly Eastern Management Corporation)
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited - Prepared by Management)
FOR THE SIX MONTH PERIOD ENDED SEPTEMBER 30, 1999
================================================================================
4. CAPITAL STOCK
On September 21, 1999, the Company implemented a 31:1 forward stock
split. The statement of changes in stockholders' equity has been
restated to give retroactive recognition of the stock split presented
by reclassifying from common stock to deficit accumulated during the
development stage, the par value of shares arising from the split. In
addition, all references to number of shares and per share amounts of
common stock have been restated to reflect the stock split.
<PAGE>
PLAN OF OPERATIONS
The following discussion of the plan of operations of the Company should be read
in conjunction with the financial statements and the related notes thereto
included elsewhere in this quarterly report for the six months ended September
30, 1999. This quarterly report contains certain forward-looking statements and
the Company's future operation results could differ materially from those
discussed herein.
Introduction
- ------------
The Company intends 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 has not entered into
any negotiations regarding such an acquisition. 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 between the Company and such other company as of the date
of this report.
Depending upon the nature of the relevant business opportunity and the
applicable state statutes governing the manner in which the transaction is
structured, the Company's Board of Directors expects that it will provide the
Company's shareholders with complete disclosure documentation concerning a
potential business opportunity and the structure of the proposed business
combination prior to consummation. Such disclosure is expected to be in the form
of a proxy or information statement.
While such disclosure may include audited financial statements of such a target
entity, there is no assurance that such audited financial statements will be
available. The Board of Directors does intend to obtain certain assurances of
value of the target entity assets prior to consummating such a transaction, with
further assurances that an audited statement would be provided within sixty days
after closing.
Due to the Company's 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. The Company does not
expect it will have to raise capital in the next twelve months. The Company also
does not expect to acquire any plant or significant equipment.
The Company has no full time employees. Our President and Secretary has agreed
to allocate a portion of his time to the activities of the Company, without
compensation. This officer anticipates that the business plan of the Company can
be implemented by him devoting approximately 5 hours per month to the business
affairs of the Company and, consequently, conflicts of interest may arise with
respect to the limited time commitment by such offices.
General Business Plan
- ---------------------
The Company's purpose is to seek, investigate and, if such investigation
warrants, acquire an interest in business opportunities presented to it by
persons or firms who or which desire to seek the perceived advantages of an
Exchange Act registered corporation. The Company will not restrict its search to
any specific business, industry, or geographical location and the Company
<PAGE>
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
be restrictive of the Company's virtually unlimited 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 the
Company has nominal assets and limited financial resources.
The Company 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 have, and will continue to have, no capital with which 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 an
initial 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, 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 which 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, or under the
supervision of, the officers and directors of the Company, none of whom is a
professional business analyst. Management intends to concentrate on identifying
preliminary prospective business opportunities which may be brought to its
attention through present associations of our officers and directors, or by our
shareholders. In analyzing prospective business opportunities, management will
consider such matters as 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 which may be
available and the depth of that management; the potential for further research,
development, or exploration; specific risk factors not now foreseeable but which
then may be anticipated to impact the proposed activities of the Company; 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. Officers and directors of the
Company 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.
We will not restrict our search for any specific kind of firms, but may acquire
a venture that is in its preliminary or development stage or is already
operating. It is impossible to predict at this time the status of any business
in which the Company may become engaged, in that such business may need to seek
additional capital, may desire to have its shares publicly traded, or
<PAGE>
may seek other perceived advantages which the Company may offer. Furthermore, we
do not intend to seek capital to finance the operation of any acquired business
opportunity until such time as the Company has successfully consummated a merger
or acquisition.
Year 2000 Disclosure
- --------------------
Many existing computer programs use only two digits to identify a year in the
date field. These programs were designed and developed without considering the
impact of the upcoming change in the century. If not corrected, many computer
applications could fail or create erroneous results by or at the year 2000. As a
result, many companies will be required to undertake major projects to address
the Year 2000 issue. Because the Company has no assets, including any personal
property such as computers, it is not anticipated that we will incur any
negative impact as a result of this potential problem. However, it is possible
that this issue may have an impact on us after we successfully consummate a
merger or acquisition. Management intends to address this potential problem with
any prospective merger or acquisition candidate. There can be no assurances that
new management of the Company will be able to avoid a problem in this regard
after a merger or acquisition is consummated.
Competition
- -----------
The Company will remain an insignificant participant among the firms which
engage in the acquisition of business opportunities. There are many established
venture capital and financial concerns which have significantly greater
financial and personnel resources and technical expertise than the Company. In
view of the Company's combined extremely limited financial resources and limited
management availability, the Company will continue to be at a significant
competitive disadvantage compared to the Company's competitors.
PART II
OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None
Item 2 CHANGES IN SECURITIES AND USE OF PROCEEDS
None
Item 3 DEFAULTS UPON SENIOR SECURITIES
None
Item 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
<PAGE>
Item 5 OTHER INFORMATION
On September 21, 1999, the Company split its then outstanding
500,000 common shares on a 1:31 basis resulting in the
Company's issued common share capital increasing to
15,500,000.
Item 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27.1 Financial Data Schedule
(b) Reports on Form 8-K
The Company filed a report on Form 8-K on November 1,
1999 reporting a change in the Company's auditors.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
INFORETECH INC.
(formerly Eastern Management Corp.)
Dated: November 16, 1999 Per: /s/ Jason John, President and Director
----------------------------------------
Jason John, President and Director
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED SEPTEMBER 30, 1999
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<CIK> 0001088201
<NAME> INFORETECH INC.(Formerly Eastern Management Corp.)
<MULTIPLIER> 1
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-START> APR-01-1999
<PERIOD-END> SEP-30-1999
<EXCHANGE-RATE> 1
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 8,052
<BONDS> 0
0
0
<COMMON> 1,550
<OTHER-SE> (9,602)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 8,052
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (8,052)
<INCOME-TAX> 0
<INCOME-CONTINUING> (8,052)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,052)
<EPS-BASIC> (0.01)
<EPS-DILUTED> 0
</TABLE>
