UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-SB/A
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS
Pursuant to Section 12(b) or (g) of the Securities and Exchange Act of 1934
ROYSTON MANNOR ESTATES, INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0421129
(State of organization) (I.R.S. Employer Identification No.)
Las Vegas Commerce Center, 1350 E. Flamingo Road, Suite 688, Las Vegas,
NV 89119
(Address of principal executive offices)
Registrant's telephone number, including area code (702) 732-2253
Registrant's Attorney: Shawn Hackman, Esq., 3360 W. Sahara Ave., Suite
200, Las Vegas, NV 89102, (702) 732-2253
Securities to be registered pursuant to Section 12(b) of the Act: None
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock
ITEM 1. DESCRIPTION OF BUSINESS
Royston Mannor Estates, Inc. is a Nevada corporation formed under the
laws of the State of Nevada on December 31, 1998. Its principal
place of business is located at Las Vegas Commerce Center, 1350 E.
Flamingo Road, Suite 688, Las Vegas, NV 89119. The Royston Mannor Estates, Inc.
was organized to engage in any lawful corporate business.
The primary activity of Royston Mannor Estates, Inc. is to locate and
consummate a merger or acquisition with a private entity. It is the
preference of Royston to merge or acquire in a manner that allows research
and development of a wholesale and retail winery. Any preference towards the
wine industry is definitively second to the primary goal of locating and
consummating a merger or acquisition. The efforts towards merging or
acquiring are primary regardless of whether the acquired or merging company
is in the wine industry or not.
Royston Mannor Estates, Inc. has been in the developmental stage
since inception and has no operating history other than organizational
matters. Royston Mannor Estates, Inc. has no operations
and in accordance with SFAS #7, is considered a development stage
company.
Mr. Makaiwi has elected to begin implementing Royston Mannor
Estates, Inc.'s principal business purpose, described below under "Item
2, Plan of Operation". As such, Royston Mannor Estates, Inc. can be
defined as a "shell" company., whose sole purpose at this time is to locate
and consummate a merger or acquisition with a private entity. The proposed
business activities described herein classify Royston Mannor Estates,
Inc. as a "blank check" company.
Many states have enacted statutes, rules, and regulations limiting the
sale of securities of "blank check" companies in their respective
jurisdictions. Management does not intend to undertake any
efforts to cause a market to develop in Royston Mannor Estates, Inc.'s
securities until such time as Royston has successfully implemented its
business plan.
Royston Mannor Estates, Inc. is filing this registration
statement on a voluntary basis, pursuant to section 12(g) of the
Securities Exchange Act of 1934 (the "Exchange Act"), in order to ensure that
public information is readily accessible to all shareholders and potential
investors, and to increase Royston Mannor Estates, Inc.'s access to
financial markets. Royston plans to increase its access to financial markets
by gaining reporting status on the over-the-counter bulletin board. In the
event Royston Mannor Estates, Inc.'s obligation to file periodic reports is
suspended pursuant to the Exchange Act, Royston Mannor Estates, Inc.
anticipates that it will continue to voluntarily file such reports.
Risk Factors
Royston Mannor Estates, Inc.'s business is subject to numerous risk
factors, including the following:
COMPETITION. The wine business is highly competitive. The Company will
be competing with a number of other potential suppliers of grapes and
wine, most of whom will have greater financial resources than the Company. In
this environment, there can be no assurance that there will be a suitable
property available for acquisition by the Company or that the Company can obtain
financing for, or participants to join in the development of a viable
vineyard operation without further financing. Most of the Company's
competitors have greater financial , personnel and other resources than
does the Company and therefore have a greater leverage to use in acquiring
properties, hiring personnel and marketing produce. Accordingly, a high
degree of competition in these areas is expected to continue.
GOVERNMENT REGULATION. The production and sale of grapes/wine is
subject to regulation by state, federal, local authorities, and foreign
governments. In most areas there are statutory provisions regulating the
production of food grapes and wine under which administrative agencies may
change rules and regulations without notice.
More particularly, in the event that the winery proceeds it would be
affected by FDA regulations regarding contamination and labeling and
packaging. Being alcohol, sales would be regulated as to time, area
and persons who could be sold to/ We would of course be affected by
sales and alcohol taxes.
AVAILABILITY OF SUITABLE PROPERTIES. Competition for properties is
intense. The Company will be competing with a number of other potential
purchasers of suitable property, most of whom will have greater financial
resources than the Company.
NO OPERATING HISTORY OR REVENUE AND MINIMAL ASSETS. Royston Mannor
Estates, Inc. has had no operating history and has received no revenues or
earnings from operations. Royston Mannor Estates, Inc. has no significant
assets or financial resources. Royston Mannor Estates, Inc. will, in all
likelihood, sustain operating expenses without corresponding revenues, at least
until it completes a business combination. This may result in Royston Mannor
Estates, Inc. incurring a net operating loss which will increase continuously
until the Company completes a business combination with a profitable business
opportunity. There is no assurance that Royston Mannor Estates, Inc.
will identify a business opportunity or complete a business combination.
SPECULATIVE NATURE OF ROYSTON MANNOR ESTATES, INC.'S PROPOSED
OPERATIONS. The success of Royston Mannor Estates, Inc.'s proposed plan of
operation will depend to a great extent on the operations, financial
condition, and management of any potential business opportunity. While
management intends to seek business combinations with entities having
established operating histories, it cannot assure that Royston Mannor Estates,
Inc. will successfully locate candidates meeting such criteria. In the event
Royston Mannor Estates, Inc. completes a business combination, the success of
the company's operations may be dependent upon management of the successor
firm or venture partner firm together with numerous other factors beyond
Royston Mannor Estates, Inc.'s control.
SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES AND
COMBINATIONS.
Royston Mannor Estates, Inc. is, and will continue to be, an
insignificant participant in the business of seeking mergers and joint
ventures with, and acquisitions of small private entities. A large number of
established and well-financed entities, including venture capital firms, are
active in mergers and acquisitions of companies which may also be desirable
target candidates for Royston Mannor Estates, Inc..
Nearly all such entities have significantly greater financial
resources, technical expertise, and managerial capabilities than Royston
Mannor Estates, Inc.. Royston Mannor Estates, Inc. is, consequently, at a
competitive disadvantage in identifying possible business opportunities and
successfully completing a business combination.
Additionally, Royston has no way to distinguish itself from other
blank check companies.
Royston Mannor Estates, Inc. will also compete with
numerous other small public companies in seeking merger or acquisition
candidates. Royston's competition will include operating companies
that are likewise looking for acquisition and merger candidates.
NO AGREEMENT FOR BUSINESS COMBINATION OR OTHER TRANSACTION - NO
STANDARDS FOR BUSINESS COMBINATION.
Royston Mannor Estates, Inc. has no arrangement,
agreement, or understanding with respect to engaging in a business
combination with any private entity. There can be no assurance that
Royston Mannor Estates, Inc. will successfully identify and evaluate suitable
business opportunities or conclude a business combination. Management
has not identified any particular industry or specific business within an
industry for evaluations. Royston Mannor Estates, Inc. has been in the
developmental stage since inception and has no operations to date. Other than
issuing shares to its original shareholders, Royston Mannor Estates, Inc. never
commenced any operational activities. There is no assurance that
Royston Mannor Estates, Inc. will be able to negotiate a business combination
on terms favorable to the company. Royston Mannor Estates, Inc. has not
established a specific length of operating history or a specified level
of earnings, assets, net worth or other criteria which it will require a
target business opportunity to have achieved, and without which Royston
Mannor Estates, Inc. would not consider a business combination in any form
with such business opportunity. Accordingly, Royston Mannor Estates, Inc. may
enter into a business combination with a business opportunity having no
significant operating history, losses, limited or no potential for earnings,
limited assets, negative net worth, or other negative characteristics.
ROYSTON IS DEPENDENT ON MANAGEMENT THAT HAS LIMITED OR NO BUSINESS
EXPERIENCE AND ONLY A PARTIAL TIME COMMITMENT TO ROYSTON.
While seeking a business combination, management anticipates devoting
ten to twenty hours per month to the business of the company. Royston
Mannor Estates, Inc.'s sole officer has not entered into written
employment agreement with the Company and does not expect to do so in
the foreseeable future.
ROYSTON HAS NO KEY MAN INSURANCE DESPITE THE DEPENDENCE ON MANAGEMENT.
Notwithstanding the combined limited experience and time commitment of
management, loss of the services of any of these individuals would
adversely affect development of Royston Mannor Estates, Inc.'s business and its
likelihood of continuing operations. Despite this, Royston Mannor
Estates, Inc. has not obtained key man life insurance on its officer or
director. See "MANAGEMENT."
REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION.
Companies subject to Section 13 of the Securities Exchange Act of 1934
(the "Exchange Act") must provide certain information about significant
acquisitions, including certified financial statements for Royston Mannor
Estates, Inc. acquired, covering one or two years, depending on the relative
size of the acquisition. The time and additional costs that may be incurred by
some target entities to prepare such statements may significantly delay or
even preclude Royston Mannor Estates, Inc. from completing an otherwise
desirable acquisition. Acquisition prospects that do not have or are unable to
obtain the required audited statements may not be appropriate for acquisition
so long as the reporting requirements of the 1934 Act are applicable.
LACK OF MARKET RESEARCH OR MARKETING ORGANIZATION.
Royston Mannor Estates, Inc. has conducted minimal market research
indicating that market demand exists for the transactions contemplated
by Royston Mannor Estates, Inc..
The very limited research conducted includes review of wine magazines,
some online internet research and visits to wineries in the Nevada and
California area.
Moreover, Royston Mannor Estates, Inc. has limited marketing
organization. If there is demand for a business combination as contemplated by
Royston Mannor Estates, Inc., there is no assurance Royston Mannor Estates,
Inc. will successfully complete such transaction.
LACK OF DIVERSIFICATION. In all likelihood, Royston Mannor Estates,
Inc.'s proposed operations, even if successful, will result in a business
combination with only one entity. Consequently, the resulting
activities will be limited to that entity's business. Royston Mannor Estates,
Inc.'s inability to diversify its activities into a number of areas may
subject Royston Mannor Estates, Inc. to economic fluctuations within a
particular business or industry, thereby increasing the risks associated with
Royston Mannor Estates, Inc.'s operations.
REGULATION. Although Royston Mannor Estates, Inc. will be subject to
regulation under the Securities Exchange Act of 1934, management
believes Royston Mannor Estates, Inc. will not be subject to regulation under
the Investment Company Act of 1940, insofar as Royston Mannor Estates, Inc.
will not be engaged in the business of investing or trading in securities.
In the event Royston Mannor Estates, Inc. engages in business combinations
which result in Royston Mannor Estates, Inc. holding passive investment
interests in a number of entities, Royston Mannor Estates, Inc. could be
subject to regulation under the Investment Company Act of 1940. In such event,
Royston Mannor Estates, Inc. would be required to register as an investment
company and could be expected to incur significant registration and compliance
costs. Royston Mannor Estates, Inc. has obtained no formal determination from
the Securities and Exchange Commission as to the status of the company
under the Investment Company Act of 1940 and, consequently, any violation of
such Act would subject Royston Mannor Estates, Inc. to material adverse
consequences.
PROBABLE CHANGE IN CONTROL AND MANAGEMENT. A business combination
involving the issuance of Royston Mannor Estates, Inc.'s common stock
will, in all likelihood, result in shareholders of a private company obtaining a
controlling interest in Royston Mannor Estates, Inc.. Any such
business combination may require management of the Company to sell or transfer
all or a portion of the company's common stock held by them, or resign as
members of the Board of Director of Royston Mannor Estates, Inc.. The
resulting change in control of the company could result in removal of one or
more present officer and director of Royston Mannor Estates, Inc. and a
corresponding reduction in or elimination of their participation in the future
affairs of Royston Mannor Estates, Inc..
REDUCTION OF PERCENTAGE SHARE OWNERSHIP FOLLOWING BUSINESS COMBINATION.
Royston Mannor Estates, Inc.'s primary plan of operation is based upon
a business combination with a private concern which, in all likelihood,
would result in Royston Mannor Estates, Inc. issuing securities to
shareholders of such private companies. Issuing previously authorized and
unissued common stock of Royston Mannor Estates, Inc. will reduce the
percentage of shares owned by present and prospective shareholders, and a
change in Royston Mannor Estates, Inc.'s control and/or management.
REQUIREMENT OF AUDITED FINANCIAL STATEMENTS MAY DISQUALIFY BUSINESS
OPPORTUNITIES.
Management believes that any potential target company must provide
audited financial statements for review, and for the protection of all parties
to the business combination. One or more attractive business opportunities may
forego a business combination with Royston Mannor Estates, Inc., rather
than incur the expenses associated with preparing audited financial
statements.
BLUE SKY CONSIDERATIONS. Because the securities registered hereunder
have not been registered for resale under the blue sky laws of any state, and
Royston Mannor Estates, Inc. has no current plans to register or qualify its
shares in any state, holders of these shares and persons who desire to
purchase them in any trading market that might develop in the future, should
be aware that there may be significant state blue sky restrictions upon the
ability of new investors to purchase the securities. These restrictions could
reduce the size of any potential market.
Non-issuer trading or resale of Royston Mannor Estates, Inc.'s
securities are exempt from state registration or qualification requirements in
most states. However, some states may continue to restrict the trading or
resale of blind- pool or "blank-check" securities. Accordingly, investors
should consider any potential secondary market for Royston Mannor Estates,
Inc.'s securities to be a limited one.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and "forward-
looking statements" as that term is defined in Section 27A of the Securities
Act of 1933 as amended (the "Securities Act"), and Section 21E of the
Securities Exchange Act of 1934 as amended (the "Exchange Act"). All statements
that are included in this Registration Statement, other than statements of
historical fact, are forward-looking statements. Although Management believes
that the expectations reflected in these forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to
have been correct. Important factors that could cause actual results to differ
materially from the expectations are disclosed in this Statement, including,
without limitation, in conjunction with those forward-looking statements
contained in this Statement.
Plan of Operation - General
Royston Mannor Estates, Inc plans to seek,
investigate, and if such investigation warrants, acquire an interest in
one or more business opportunities presented to it by persons or firms
desiring the perceived advantages of a publicly held corporation. At this time,
Royston Mannor Estates, Inc. has no plan, proposal, agreement,
understanding, or arrangement to acquire or merge with any specific business or
company and Royston Mannor Estates, Inc. has not identified any specific
business or a company for investigation and evaluation. No member of
Management or any promoter of Royston Mannor Estates, Inc., or an affiliate
of either, has had any material discussions with any other company with
respect to any acquisition of Royston Mannor Estates, Inc.
Royston Mannor Estates, Inc. will
not restrict its search to any specific business, industry, or
geographical location, and may participate in business ventures of virtually
any kind or nature.
However, Royston will give preference to companies involved in the
winery business. Discussion of the proposed business under this caption and
throughout this Registration Statement is purposefully general and is not
meant to restrict Royston Mannor Estates, Inc.'s virtually unlimited
discretion to search for and enter into a business combination. Royston
Mannor Estates, Inc. may seek a combination with a firm
which only recently commenced operations, or a developing company in
need of additional funds to expand into new products or markets or seeking to
develop a new product or service, or an established business which may be
experiencing financial or operating difficulties and needs additional
capital which is perceived to be easier to raise by a public company.
In some instances, a business opportunity may involve acquiring or
merging with a corporation which does not need substantial additional cash
but which desires to establish a public trading market for its common stock.
Royston Mannor Estates, Inc. may purchase assets and establish wholly-owned
subsidiaries in various businesses or purchase existing businesses as
subsidiaries. Selecting a business opportunity will be complex and extremely
risky. Because of 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 benefits of a publicly-traded
corporation. Such perceived benefits of a publicly traded corporation
may include facilitating or improving the terms on which additional equity
financing may be sought, providing liquidity for the principals of a
business, creating a means for providing incentive stock options or
similar benefits to key employees, providing liquidity (subject to restrictions
of applicable statues) for all shareholders, and other items.
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 such business
opportunities extremely difficult and complex. Management believes that
Royston Mannor Estates, Inc. may be able to benefit from the use of
"leverage" to acquire a target company. Leveraging a transaction involves
acquiring a business while incurring significant indebtedness for a large
percentage of the purchase price of that business. Through leveraged
transactions, Royston Mannor Estates, Inc. would be required to use less of
its available funds to acquire a target company and, therefore, could commit
those funds to the operations of the business, to combinations with other
target companies, or to other activities.
The borrowing involved in a leveraged transaction will ordinarily
be secured by the assets of the acquired business. If that business is
not able to generate sufficient revenues to make payments on the debt
incurred by the company to acquire that business, the lender would be able to
exercise the remedies provided by law or by contract. These leveraging
techniques, while reducing the amount of funds that Royston Mannor
Estates, Inc. must commit to acquire a business, may correspondingly
increase the risk of loss to Royston Mannor Estates, Inc..
No assurance can be given as to the terms or availability of financing
for any acquisition by Royston Mannor Estates,Inc.. During periods
when interest rates are relatively high, the benefits of
leveraging are not as great as during periods of lower interest rates,
because the investment in the business held on a leveraged basis will
only be profitable if it generates sufficient revenues to cover the related
debt and other costs of the financing. Lenders from which Royston Mannor
Estates, Inc. may obtain funds for purposes of a leveraged buy-out may impose
restrictions on the future borrowing, distribution, and operating
policies of Royston Mannor Estates, Inc.. It is not possible at this time to
predict the restrictions, if any, which lenders may impose, or the impact
thereof on Royston Mannor Estates, Inc..
Royston Mannor Estates, Inc. has insufficient
capital with which to provide the owners of businesses significant cash
or other assets. Management believes Royston Mannor Estates, Inc. will
offer owners of businesses the opportunity to acquire a controlling ownership
interest in a public company at substantially less cost than is
required to conduct an initial public offering. However, a business that
conducts a public will raise capital, but will not raise capital as a result of
merging with Royston. The owners of the businesses will, however, incur
significant post-merger or acquisition registration costs in
the event they wish to register a portion of their shares for
subsequent sale. Royston Mannor Estates, Inc. will also incur significant legal
and accounting costs in connection with the acquisition of a business
opportunity, including the costs of preparing Forms 8-K, agreements,
and related reports and documents. At a minimum, It will be necessary
to file a Form 8K. Additionally, 10Qs and 10Ks will need to be filed
as necessary.
Nevertheless, the officer and director of Royston Mannor Estates, Inc.
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 businesses.
Royston Mannor Estates, Inc. does not intend to make any loans to
any prospective merger or acquisition candidates or to unaffiliated
third parties. Royston Mannor Estates, Inc. will not restrict its search for
any specific kind of firms, but may acquire a venture which is in its
preliminary or development stage, which is already in operation, or in
essentially any stage of its corporate life. It is impossible to predict at
this time the status of any business in which Royston Mannor Estates, Inc.
may become engaged, in that such business may need to seek additional
capital, may desire to have its shares publicly traded, or may seek other
perceived advantages which Royston Mannor Estates, Inc. may offer. However,
Royston Mannor Estates, Inc. does not intend to obtain funds in one or more
private placements to finance the operation of any acquired business
opportunity until such time as Royston Mannor Estates, Inc. has successfully
consummated such a merger or acquisition. Royston Mannor Estates, Inc. also
has no plans to conduct any offerings under Regulation S.
Currently, the company has minimal cash. Additional funds will have to
be raised via securities issues or will need to be borrowed from
management in order to properly pursue its business plan.. Should
Royston be unable to raise the necessary funds in the next 12 months,
Royston Mannor would be unable to fully implement its business plan and
may be unable to implement its business plan at all. In such an event,
all active operations of Roysaton would cease.
Sources of Opportunities
Royston Mannor Estates, Inc. will seek a potential business opportunity
from all known sources, but will rely principally on personal contacts of
its officer and director as well as indirect associations between them and
other business and professional people. It is not presently anticipated
that Royston Mannor Estates, Inc. will engage professional firms
specializing in business acquisitions or reorganizations. Management, while
not especially experienced in matters relating to the new business of the
Company, will rely upon their own efforts and, to a much lesser extent, the
efforts of Royston Mannor Estates, Inc.'s shareholders, in accomplishing the
business purposes of Royston Mannor Estates, Inc.. It is not anticipated that
any outside consultants or advisors, other than Royston Mannor Estates, Inc.'s
legal counsel and accountants, will be utilized by Royston Mannor Estates,
Inc. to effectuate its business purposes described herein. However, if Royston
Mannor Estates, Inc. does retain such an outside consultant or advisor, any
cash fee earned by such party will need to be paid by the prospective
merger/acquisition candidate, as Royston Mannor Estates, Inc. has no
cash assets with which to pay such obligation. There have been no
discussions, understandings, contracts or agreements with any outside
consultants and none are anticipated in the future.
In the past, Royston Mannor Estates, Inc.'s
management has never used outside consultants or advisors in connection
with a merger or acquisition. As is customary in the industry, a finder's
fee for locating an acquisition prospect may be necessary. If any such
fee is paid, it will have to be approved and paid for by the target
candidate because Royston has no cash. Any such payment would be done
in accordance with industry standards.
Such fees are customarily between 1% and 5% of the size of the
transaction, based upon a sliding scale of the amount involved. Such fees are
typically in the range of 5% on a $1,000,000 transaction ratably down to 1% in a
$4,000,000 transaction. Management has adopted a policy that such a
finder's fee or real estate brokerage fee could, in certain circumstances, be
paid to any employee, officer, director or 5% shareholder of Royston Mannor
Estates, Inc., if such person plays a material role in bringing a transaction to
Royston Mannor Estates, Inc..
It should be noted that Mr. Makaiwi has little or no experience in
wineries other than observations. Mr. Makaiwi does have general business
experience as disclosed in the resume.
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by or
under the supervision of the officer and director of Royston Mannor Estates,
Inc. (see "Management"). Management intends to concentrate on identifying
prospective business opportunities which may be brought to its
attention through present associations with management. In analyzing prospective
business opportunities, management will consider, among other factors,
such matters as;
1. the available technical, financial and managerial resources
2. working capital and other financial requirements
3. history of operation, if any
4. prospects for the future
5. present and expected competition
6. the quality and experience of management services which may be
available and the depth of that management
7. the potential for further research, development or exploration
8. specific risk factors not now foreseeable but which then may be
anticipated to impact the proposed activities of Royston Mannor
Estates, Inc.
9. the potential for growth or expansion
10. the potential for profit
11. the perceived public recognition or acceptance of products,
services or trades
12. name identification
Management will meet personally with management and key personnel of
the firm sponsoring the business opportunity as part of their investigation. To
the extent possible, Royston Mannor Estates, Inc. intends to utilize
written reports and personal investigation to evaluate the above factors.
Royston Mannor Estates, Inc. will not acquire or merge with any company for
which audited financial statements cannot be obtained. Opportunities in
which Royston Mannor Estates, Inc. participates will present certain risks,
many of which cannot be identified adequately prior to selecting a specific
opportunity. Royston Mannor Estates, Inc.'s shareholders must,
therefore, depend on Management to identify and evaluate such risks.
Promoters of some opportunities may have been unable to develop a going
concern or may present a business in its development stage (in that it has
not generated significant revenues from its principal business activities
prior to Royston Mannor Estates, Inc.'s participation.) Even after Royston
Mannor Estates, Inc.'s participation, there is a risk that the combined
enterprise may not become a going concern or advance beyond the development
stage. Other opportunities may involve new and untested products, processes,
or market strategies which may not succeed. Such risks will be assumed by
Royston Mannor Estates, Inc. and, therefore, its shareholders.
The investigation of specific business opportunities and the
negotiation, drafting, and execution of relevant agreements, disclosure
documents, and other instruments will require substantial management time and
attention as well as substantial costs for accountants, attorneys, and
others. If a decision is made not to participate in a specific business
opportunity the costs incurred in the related investigation would not be
recoverable. Furthermore, even if an agreement is reached for the
participation in a specific business opportunity, the failure to consummate
that transaction may result in the loss by Royston Mannor Estates, Inc. of the
related costs incurred. There is the additional risk that Royston Mannor
Estates, Inc. will not find a suitable target. Management does not believe
Royston Mannor Estates, Inc. will generate revenue without finding and
completing a transaction with a suitable target company. If no such target is
found, therefore, no return on an investment in the company. will be realized,
and there will not, most likely, be a market for Royston Mannor Estates,
Inc.'s stock.
Acquisition of Opportunities
In implementing a structure for a particular business acquisition,
Royston Mannor Estates, Inc. may become a party to a merger, consolidation,
reorganization, joint venture, franchise, or licensing agreement with
another corporation or entity. It may also purchase stock or assets of an
existing business. Once a transaction is complete, it is possible that the
present management and shareholders of Royston Mannor Estates, Inc. will not
be in control of the company. In addition, a majority or all of Royston
Mannor Estates, Inc.'s officer and director may, as part of the terms of the
transaction, resign and be replaced by new officer and director without
a vote of Royston Mannor Estates, Inc.'s shareholders.
It is anticipated that securities issued in any such reorganization
would be issued in reliance on exemptions from registration under applicable
Federal and state securities laws. In some circumstances, however, as a
negotiated element of this transaction, Royston Mannor Estates, Inc. may
agree to register such securities either at the time the transaction is
consummated, under certain conditions, or at specified time thereafter. The
issuance of substantial additional securities and their potential sale into any
trading market which may develop in Royston Mannor Estates, Inc.'s Common Stock
may have a depressive effect on such market. While the actual terms of a
transaction to which Royston Mannor Estates, Inc. may be a party 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 of 1986, as
amended (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 such event, the shareholders
of Royston Mannor Estates, Inc., including investors in this offering,
would retain less than 20% of the issued and outstanding shares of the
surviving entity, which could result in significant dilution in the equity of
such shareholders.
As part of Royston Mannor Estates, Inc.'s investigation, officer and
director of Royston Mannor Estates, Inc. will meet personally with
management and key personnel, may visit and inspect material
facilities, obtain independent analysis or verification of certain information
provided, check references of management and key personnel, and take other
reasonable investigative measures, to the extent of Royston Mannor Estates,
Inc.'s limited financial resources and management expertise. The manner in
which Royston Mannor Estates, Inc. participates in an opportunity with a
target company will depend on the nature of the opportunity, the respective
needs and desires of the company and other parties, the management of the
opportunity, and the relative negotiating strength of the company and such
other management. With respect to any mergers or acquisitions, negotiations
with target company, management will be expected to focus on the percentage of
Royston Mannor Estates, Inc. which the target company's shareholders would
acquire in exchange for their shareholdings in the target company. Depending
upon, among other things, the target company's assets and liabilities, Royston
Mannor Estates, Inc.'s shareholders will, in all likelihood, hold a lesser
percentage ownership interest in the company following any merger or
acquisition. The percentage ownership may be subject to significant
reduction in the event Royston Mannor Estates, Inc. acquires a target company
with substantial assets. Any merger or acquisition effected by Royston
Mannor Estates, Inc. can be expected to have a significant dilutive effect on
the percentage of shares held by Royston Mannor Estates, Inc.'s then
shareholders, including purchasers in this offering. Management has
advanced, and will continue to advance, funds which shall be used by
Royston Mannor Estates, Inc. in identifying and pursuing agreements with target
companies. Management anticipates that these funds will be repaid from
the proceeds of any agreement with the target company, and that any such
agreement may, in fact, be contingent upon the repayment of those
funds.
It is expected that amounts to conduct investigations will be less than
$10,000 and that such amount will come from Mr. Makaiwi. Additional funds
may need to be raised if the amount exceeds this or Mr. Makaiwi is short on
funds.
Mr. Makaiwi may contribute up to $10,000 for acquisition
investigations. However, Mr. Makaiwi is not obigated to advance any additional
amount to Royston. Royston may be required to issue stock to raise additional
funds if Mr. Makaiwi cannot provide said funds.
Competition
Royston Mannor Estates, Inc. is an insignificant participant among
firms which engage in business combinations with, or financing of,
development-stage enterprises. There are many established management
and financial consulting companies and venture capital firms which have
significantly greater financial and personal resources, technical
expertise and experience than Royston Mannor Estates, Inc.. In view of Royston
Mannor Estates, Inc.'s limited financial resources and management
availability, Royston Mannor Estates, Inc. will continue to be at significant
competitive disadvantage vis-a-vis the Royston Mannor Estates, Inc.'s
competitors. The Company will be at at a disadvantage with other companies
having larger technical staffs, established market shares and greater
financial backing.
Regulation and Taxation
The Investment Company Act of 1940 defines an "investment company." as
an issuer which is or holds itself out as being engaged primarily in the
business of investing, reinvesting or trading securities. While Royston
Mannor Estates, Inc. does not intend to engage in such activities,
Royston Mannor Estates, Inc. may obtain and hold a minority interest in a
number of development stage enterprises. Royston Mannor Estates, Inc. could be
expected to incur significant registration and compliance costs if required to
register under the Investment Company. Act of 1940. Accordingly,
management will continue to review Royston Mannor Estates, Inc.'s activities
from time to time with a view toward reducing the likelihood Royston Mannor
Estates, Inc. could be classified as an "investment company." Royston Mannor
Estates, Inc. intends to structure a merger or acquisition in such manner as to
minimize Federal and state tax consequences to Royston., and to any
target company.
Employees
Royston Mannor Estates, Inc.'s only employees at the present time are
its officer and director, who will devote as much time as the Board of
Director determine is necessary to carry out the affairs of the Royston
Mannor Estates, Inc.. (See "Management").
Mr. Makaiwi's time devotion to Royston would be estimated at 10 hours a
month until further fundraising or a merger/acquisition.
ITEM 3. DESCRIPTION OF PROPERTY.
Royston Mannor Estates, Inc. neither owns nor leases any real property
at this time. Royston Mannor Estates, Inc. conducts its business from
Vegas Commerce Center, 1350 E. Flamingo Road, Suite 688, Las Vegas, NV 89119.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
As of December 31,1998, no one is the beneficial owner of five percent
(5%) or more of Royston Mannor Estates, Inc.'s common stock. The management
of Royston does not own any stock in the Company.
ITEM 5. DIRECTOR, EXECUTIVE OFFICER, PROMOTERS, AND CONTROL PERSONS
The members of the Board of Director of Royston Mannor Estates, Inc.
serve until the next annual meeting of the stockholders, or until their
successors have been elected. The officer serve at the pleasure of the Board of
Director. There are no agreements for any officer or director to resign
at the request of any other person, and none of the officer or director
named below are acting on behalf of, or at the direction of, any other
person. Royston Mannor Estates, Inc.'s officer and director will devote their
time to the business on an "as-needed" basis, which is expected to require
5-10 hours per month.
Information as to the director and executive officer of the Royston
Mannor Estates, Inc. is as follows:
Name Age Position
Harvey Makaiwi 48 President, Sole
Officer and Director
Harvey Makaiwi Age 48
Operated a pottery mail order business from 1990 to 1996. Developed an
interest in wine in Europe while on tour in the US military.
Blank Check Experience
None.
There is no family relationship between any of the officer and director
of the Royston Mannor Estates, Inc.. The Royston Mannor Estates, Inc.'s
Board of Director has not established any committees.
Conflicts of Interest
Management anticipates it will devote only a minor amount of time to
Royston Mannor Estates, Inc.'s affairs. Currently, Mr. Makaiwi works fulltime
as a farmhand on various vineyards. Mr. Makaiwi. may in the future
become a shareholder, officer or director of other companies which may
be formed for the purpose of engaging in business activities similar to
those conducted by Royston Mannor Estates, Inc..
Royston Mannor Estates, Inc. does not currently have a right of first
refusal pertaining to opportunities that come to management's attention insofar
as such opportunities may relate to Royston Mannor Estates, Inc.'s
proposed business operations.
Mr. Makaiwi, so long as he is an officer of Royston Mannor Estates,
Inc., is subject to the restriction that all
opportunities contemplated by Royston Mannor Estates, Inc.'s plan of
operation which come to their attention, either in the performance of
their duties or in any other manner, will be considered opportunities of, and
be made available to Royston Mannor Estates, Inc. and the companies that
they are affiliated with on an equal basis. A breach of this requirement
will be a breach of the fiduciary duties of the officer or director. Subject to
the next paragraph, if a situation arises in which 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 or acquire such target company., the company of which the President first
became an officer and director will be entitled to proceed with the
transaction. Except as set forth above, Royston Mannor Estates, Inc. has not
adopted any other conflict of interest policy with respect to such transactions.
Investment Company Act of 1940
Although Royston Mannor Estates, Inc. will be subject to regulation
under the Securities Act of 1933 and the Securities Exchange Act of 1934,
management believes Royston Mannor Estates, Inc. will not be subject to
regulation under the Investment Company Act of 1940 insofar as Royston Mannor
Estates, Inc. will not be engaged in the business of investing or trading in
securities. In the event Royston Mannor Estates, Inc. engages in business
combinations which result in Royston Mannor Estates, Inc. holding passive
investment interests in a number of entities, Royston Mannor Estates, Inc.
could be subject to regulation under the Investment Company Act of 1940. In
such event, Royston Mannor Estates, Inc. would be required to register as an
investment company and could be expected to incur significant registration
and compliance costs. Royston Mannor Estates, Inc. has obtained no formal
determination from the Securities and Exchange Commission as to the status of
the company under the Investment Company Corp. Act of 1940 and, consequently,
any violation of such Act would subject Royston Mannor Estates, Inc. to
material adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION
There is no executive compensation given to Mr. Makaiwi. It is
possible that, after Royston Mannor Estates, Inc.
successfully consummates a merger or acquisition with an unaffiliated
entity, that entity may desire to employ or retain one or more members of
Royston Mannor Estates, Inc.'s management for the purposes of providing
services to the surviving entity, or otherwise provide other compensation to
such persons. It is possible that persons associated with management may refer a
prospective merger or acquisition candidate to Royston Mannor Estates,
Inc.. In the event Royston Mannor Estates, Inc. consummates a transaction
with any entity referred by associates of management, it is possible that such
an associate will be compensated for their referral in the form of a
finder's fee. It is anticipated that this fee will be either in the form of
restricted common stock issued by Royston Mannor Estates, Inc. as part of the
terms of the proposed transaction, or will be in the form of cash consideration.
However, if such compensation is in the form of cash, such payment will
be tendered by the acquisition or merger candidate, because Royston Mannor
Estates, Inc. has insufficient cash available. The amount of such
finder's fee cannot be determined as of the date of this registration
statement, but is expected to be comparable to consideration normally paid in
like transactions. No member of management of Royston Mannor Estates, Inc.
will receive any finders fee, either directly or indirectly, as a result of
their respective efforts to implement Royston Mannor Estates, Inc.'s business
plan outlined herein. Persons "associated" with management is meant to
refer to persons with whom management may have had other business dealings, but
who are not affiliated with or relatives of management. No retirement,
pension, profit sharing, stock option or insurance programs or other similar
programs have been adopted by the Registrant for the benefit of its employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
ITEM 8. LEGAL PROCEEDINGS
Royston Mannor Estates, Inc. is not a party to any material pending
legal proceedings and, to the best of its knowledge, no such action by or
against Royston Mannor Estates, Inc. has been threatened.
ITEM 9. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Royston Mannor Estates, Inc.'s common stock is not traded on any
exchange or OTC market. Management has not undertaken any discussions,
preliminary or otherwise, with any prospective market maker concerning the
participation of such market maker in the after-market for Royston Mannor
Estates, Inc.'s securities and management does not intend to initiate any such
discussions until such time as Royston Mannor Estates, Inc. has consummated a
merger or acquisition. There is no assurance that a trading market will ever
develop or, if such a market does develop, that it will continue. After a
merger or acquisition has been completed, the company's officer and
director will most likely be the person to contact prospective market
makers. It is also possible that persons associated with the entity
that merges with or is acquired by Royston Mannor Estates, Inc. will contact
prospective market makers. Royston Mannor Estates, Inc. does not intend
to use consultants to contact market makers.
Market Price
The Registrant's Common Stock is not quoted at the present time.
Effective August 11, 1993, the Securities and Exchange Commission
adopted Rule 15g-9, which established the definition of a "penny stock," for
purposes relevant to Royston Mannor Estates, Inc., as any equity security that
has a market price of less than $5.00 per share or with an exercise price of
less than $5.00 per share, subject to certain exceptions. For any
transaction involving a penny stock, unless exempt, the rules require: (i)
that a broker or dealer approve a person's account for transactions in penny
stocks; and (ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and quantity of the
penny stock to be purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must (i) obtain financial
information and investment experience and objectives of the person; and (ii)
make a reasonable determination that the transactions in penny stocks are
suitable for that person and that person has sufficient knowledge and
experience in financial matters to be capable of evaluating the risks of
transactions in penny stocks. The broker or dealer must also deliver, prior
to any transaction in a penny stock, a disclosure schedule prepared by the
Commission relating to the penny stock market, which, in highlight
form,
(i) sets forth the basis on which the broker or dealer made the
suitability determination; and (ii) that the broker or dealer received a signed,
written agreement from the investor prior to the transaction.
Disclosure also has to be made about the risks of investing in penny stocks in
both public offerings and in secondary trading, and about commissions payable to
both the broker-dealer and the registered representative, current quotations
for the securities and the rights and remedies available to an investor in
cases of fraud in penny stock transactions. Finally, monthly statements have to
be sent disclosing recent price information for the penny stock held in
the account and information on the limited market in penny stocks. The
National Association of Securities Dealers, Inc. (the "NASD"), which administers
NASDAQ, has recently made changes in the criteria for initial listing
on the NASDAQ Small Cap market and for continued listing. For initial listing,
a company must have net tangible assets of $4 million, market
capitalization of $50 million or net income of $750,000 in the most recently
completed fiscal year or in two of the last three fiscal years. For initial
listing, the common stock must also have a minimum bid price of $4 per share.
In order to continue to be included on NASDAQ, a company must maintain
$2,000,000 in net tangible assets and a $1,000,000 market value of its
publicly-traded securities. In addition, continued inclusion requires two
market-makers and a minimum bid price of $1.00 per share.
Management intends to strongly consider undertaking a transaction with
any merger or acquisition candidate which will allow Royston Mannor
Estates, Inc.'s securities to be traded without the aforesaid limitations.
However, there can be no assurances that, upon a successful merger or
acquisition, that Royston Mannor Estates, Inc. will qualify its securities for
listing on NASDAQ or some other national exchange, or be able to maintain the
maintenance criteria necessary to insure continued listing. The failure
of Royston Mannor Estates, Inc. to qualify its securities or to meet the
relevant maintenance criteria after such qualification in the future
may result in the discontinuance of the inclusion of Royston Mannor
Estates, Inc.'s securities on a national exchange. In such events, trading, if
any, in Royston Mannor Estates, Inc.'s securities may then continue in the non-
NASDAQ over-the-counter market. As a result, a shareholder may find it more
difficult to dispose of, or to obtain accurate quotations as to the
market value of, Royston Mannor Estates, Inc.'s securities.
Holders
As of September 30,1999, there are 65 holders of Royston Corp's common
shares. 40 of these shareholders hold stock pursuant to
Rule 504 of Regulation D, Section 4(6) exemption. (See Possible Rescission
of shares under Description of Securities) Twenty Five
shareholders hold restricted stock pursuant to Rule 144.
Dividends
The Registrant has not paid any dividends to date, and has no plans to
do so in the immediate future.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.
With respect to the sales made, the Registrant relied on Section 4(2)
of the Securities Act of 1933, as amended and governed by Rule 144. No
advertising or general solicitation was employed in offering the
shares. The securities were offered for investment only and not for the
purpose of resale or distribution, and the transfer thereof was appropriately
restricted.
In March of 1999, Royston completed the sale of 200,000 shares of its
common stock at $.10 per share for a total of $20,000.
In October of 1999, Royston sold, by private placement, 50,000 shares
of its common stock at $.20 per share for a total of $10,000. In this
placement, 10 people purchased 5,000 shares each.
ITEM 11. DESCRIPTION OF SECURITIES.
Common Stock
Royston Corp was incorporated on December 31, 1998, as Royston Mannor
Estates, Inc., with an authorized share capital of Fifty Million
(50,000,000) shares of Common Stock. Upon incorporation, the company initially
issued One Hundred Thousand (100,000) Common Shares with par value of $.001.
These shares were restricted under Rule 144 of the Securities Act of 1933, as
amended.
The Royston Mannor Estates, Inc.'s Articles of Incorporation authorizes
the issuance of 50,000,000 shares of Common stock, of which 300,000 are
issued and outstanding. The shares are non-assessable, without pre-emptive
rights, and do not carry cumulative voting rights. Holders of common shares are
entitled to one vote for each share on all matters to be voted on by
the stockholders. The shares are without pre-emptive rights and do not
carry cumulative voting rights. Holders of common shares are entitled
to share ratably in dividends, if any, as may be declared by Royston
Mannor Estates, Inc. from time-to-time, from funds legally available.
In the event of a liquidation, dissolution, or winding up of Royston
Mannor Estates, Inc., the holders of shares of common stock are
entitled to share on a pro-rata basis all assets remaining after payment in
full of all liabilities. Management is not aware of any circumstances in which
additional shares of any class or series of Royston Mannor Estates, Inc.'s
stock are to be issued to management or promoters, or affiliates or associates
of either.
POSSIBLE RIGHT OF RESCISSION OF 200,000 SHARES OFFERED UNDER 504
OFFERING.
On February 15, 1999 the Company offered, pursuant to a Rule 504 of
Regulation D Offering filed with the Securities and Exchange
Commission, One Million, 1,000,000, Common Shares at $0.10 per share.
On March 25, 1999, the Company sold and issued Two Hundred Thousand
(200,000) Common Shares at $0.10 per share from that Rule 504 of
Regulation D Offering. These 200,000 shares have been deemed free
trading by Scott J. Uricchio of Schott & Uricchio. Mr. Uricchio's
opinion concerning these shares free trading status and counsel's
consent to the use of this opinion in this Form 10SB are included as
exhibit 99.1.
However, on January 21, 2000, Mr. Richard K. Wulff, Chief of Office of Small
Business for the SEC, issued an interpretative letter to Mr. Ken Worm,
Assistant Director of the OTC Compliance Unit of the NASD Regulation,
concerning the tradability of stock issued in limited operation companies.
Mr. Wulff's interpretation was that stock issued or gifted under an exemption
under the 1933 Act would not be considered free trading."
Based on this interpretation, it may be possible that the stock issued under
this offering will not be deemed free-trading. Therefore, Royston Mannor may be
liable to the shareholders who bought shares under the aforementioned 504
offering. The shareholders in this case may have a right of rescission,
subjecting the Company to the return of $20,000.00 raised in the offering.
ITEM 12. INDEMNIFICATION OF DIRECTOR AND OFFICER.
Royston Mannor Estates, Inc. and its affiliates may not be liable to
its shareholders for errors in judgment or other acts or omissions not
amounting to intentional misconduct, fraud, or a knowing violation of the law,
since provisions have been made in the Articles of incorporation and By-laws
limiting such liability. The Articles of Incorporation and By-laws also
provide for indemnification of the officer and director of Royston
Mannor Estates, Inc. in most cases for any liability suffered by them or
arising from their activities as officer and director of Royston Mannor
Estates, Inc. if they were not engaged in intentional misconduct, fraud, or a
knowing violation of the law. Therefore, purchasers of these securities may
have a more limited right of action than they would have except for this
limitation in the Articles of Incorporation and By-laws. The officer and
director of Royston Mannor Estates, Inc. are accountable to Royston Mannor
Estates, Inc. as fiduciaries, which means such officer and director are
required to exercise good faith and integrity in handling Royston Mannor
Estates, Inc.'s affairs. A shareholder may be able to institute legal action on
behalf of himself and all others similarly stated shareholders to recover
damages where Royston Mannor Estates, Inc. has failed or refused to observe the
law. Shareholders may, subject to applicable rules of civil procedure, be
able to bring a class action or derivative suit to enforce their rights,
including rights under certain federal and state securities laws and
regulations. Shareholders who have suffered losses in connection with the
purchase or sale of their interest in Royston Mannor Estates, Inc. in
connection with such sale or purchase, including the misapplication by any such
officer or director of the proceeds from the sale of these securities, may be
able to recover such losses from Royston Mannor Estates, Inc..
ITEM 13. FINANCIAL STATEMENTS.
The financial statements and supplemental data required by this Item 13
follow the index of financial statements appearing at Item 15 of this
Form 10-SB.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE.
The Registrant has not changed accountants since its formation, and
Management has had no disagreements with the findings of its
accountants.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.
FINANCIAL STATEMENTS
EXHIBITS
3.1 Articles of Incorporation
Incorporated by
reference in
Company's Form
10SB filed May 15th,
2000
3.2 By-Laws Incorporated by
reference in
Company's Form 10SB filed
May 15,2000
99.1 Opinion of Scott J.
Uricchio concerning the
tradability
of 200,000
issued on March 25, 1999.
SIGNATURES
In accordance with Section 12 of the Securities Act of 1934, the
Registrant caused this registration to be signed on its behalf by the
undersigned, thereunto duly authorized.
Royston Mannor Estates, Inc.
By:/S/__________________
Harvey Makaiwi
President.
ROYSTON MANNOR ESTATES. INC.
( A DEVELOPMENT STAGE COMPANY )
FINANCIAL STATEMENTS
MARCH 31, 2000, AND MARCH 31, 1999
TABLE OF CONTENTS
Page Number
[S] [C]
INDEPENDENT ACCOUNTANTS REPORT. . . . . . . . . . . 1
FINANCIAL STATEMENT
Balance Sheets. . . . . . . . . . . . . . . . . . . 2
Statements of Operations and Deficit
Accumulated During the Development Stage. . . . . .3
Statement of Changes in Stockholders' Equity. . . . 4
Statements of Cash Flows. . . . . . . . . . . . . . 5
Notes to the Financial Statements. . . . . . . . . 6-7
DAVID E. COFFEY 3651 LINDELL ROAD, SUITE A, LAS VEGAS. NEVADA 89103
CERTIFIED PUBLIC ACCOUNTANT (702) 871-3979
INDEPENDENT ACCOUNTANTS REPORT
To the Board of Directors and Stockholders of Royston Mannor Estates,
Inc. Las Vegas, Nevada
I have audited the accompanying balance sheets of Royston Mannor
Estates, Inc., (a development stage company) as of March 31, 2000, and
March 31, 1999, and the related statements of operations, cash flows,
and changes in stockholders' equity for the periods then ended, as well
as the cumulative period from December 31, 1998, (date of inception) to
March 31, 2000. These statements are the responsibility of Royston
Mannor Estates, Inc.'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 I 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 accompanying financial statements present fairly,
in all material respects, the financial position of Royston Mannor
Estates, Inc., as of March 31, 2000, and March 31, 1999, and the
results of operations, cash flows, and changes in stockholders' equity
for the periods then ended, as well as the cumulative period from
December 31, 1998, in conformity with generally accepted accounting
principles.
David Coffey, C. P. A.
Las Vegas, Nevada
May 19, 1999
<TABLE>
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
BALANCE SHEETS
<CAPTION>
Mar 31, 2000 Mar 31, 1999
------------ ------------
<S> <C> <C>
ASSETS
Cash $1,058 $78
--------- --------
Total assets $1,058 $78
========= ========
LIABILITITES AND STOCKHOLDERS EQUITY
Accounts Payable $5,400 $400
--------- --------
Total Liabilities 5,400 400
Common stock subject to rescission;
par value of 200,000 shares issued in
March 1999 200 200
Additional paid in capital 19,800 19,800
-------- --------
Common stock subject to rescission 20,000 20,000
Stockholders equity
common stock authorized 50,000,000
shares at $.001 par value, issued and
outstanding 150,000 shares and 100,000
shares, respectively 150 100
Additional paid in capital 6,950 0
Deficit accumulated during the development
stage (31,442) (20,422)
-------- ---------
Total stockholders deficit (24,342) (20,322)
Total Liabilitites and Stockholders'
Equity $1,058 $78
======== ==========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<TABLE>
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
STATEMENTS OF OPERATIONS AND DEFICIT
ACCUMULATED DURING THE DEVELOPMENT STAGE
(WITH CUMLATIVE FIGURES FROM INCEPTION)
<CAPTION>
From inception
Jan 1, 2000 to Jan 1, 1999 to Dec 31, 1998 to
Mar 31, 2000 Mar 31, 1999 Mar 31, 2000
-------------- -------------- ---------------
<S> <C> <C> <C>
Income $0 $0 0
Expenses
Organizational expense 0 0 400
Consulting 5,990 20,000 25,990
Professional fees 5,000 0 5,000
Office Expenses 0 22 52
------- ------- --------
Total Expenses 10,990 20,022 31,442
Net loss (10,990) (20,022) $(31,442)
==========
Retained earnings,
beginning of period (20,452) (400)
-------- --------
Deficit accumulated during
the development stage $(31,442) $(20,422)
========= =========
Earnings (loss) per share
assuming dilution:
Net loss $(0.03) $(0.09) $(0.11)
========== ========= ==========
Weighted average shares
outstanding 350,000 233,333 281,250
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<TABLE>
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM DECEMBER 31, 1998 (DATE OF INCEPTION) TO
MARCH 31, 2000
<CAPTION>
Common Stock Additional Total
Shares Amount Paid in
Capital
------ ------ ---------- ------
<S> <C> <C> <C> <C>
$ $ $
Balance
December 31, 1998 --- --- --- ---
Issuance of common stock for cash
December 1998 100,000 100 0 100
Less net loss 0 0 0 (400)
-------- ---- ----- ------
Balance
December 31, 1998 100,000 100 0 (300)
Issuance of common stock for cash
October 1999 50,000 50 9,950 10,000
Less offering costs 0 0 (3,000) (3,000)
Less net loss 0 0 0 (20,052)
-------- ----- -------- --------
Balance
December 31, 1999 150,000 $150 $6,950 $(13,352)
Less net loss 0 0 0 (10,990)
-------- ----- -------- ---------
Balance
March 31, 2000 150,000 150 6,950 (24,342)
======== ===== ======== =========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<TABLE>
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
STATEMENTS OF CASH FLOWS
(WITH CUMULATIVE FIGURES FROM INCEPTION)
<CAPTION>
From inception
Jan 1, 2000 Jan 31, 1999 to Dec 31, 1998 to
Mar 31, 2000 Mar 31, 1999 Mar 31, 2000
------------ --------------- ----------------
<S> <C> <C> <C>
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES
Net loss $(10,990) $(20,022) $(31,442)
Non cash items included
in net loss 0 0 0
Adjustments to reconcile
net loss to cash used by
operating activity
Accounts payable 5,000 0 5,400
--------- ---------- ---------
NET CASH PROVIDED BY
OPERATING ACTIVITIES (5,990) (20,022) (26,042)
CASH FLOWS USED BY
INVESTING ACTIVITIES 0 0 0
-------- ---------- ---------
NET CASH USED BY
INVESTING ACTIVITIES 0 0 0
CASH FLOWS FROM FINANCING
ACTIVITIES
Sale of common stock
subject to rescission 0 200 200
Paid In Capital subject
to rescission 0 19,800 19,800
Sale of common stock 0 0 150
Paid in Capital 0 0 9,950
Less Offering costs 0 0 (3,000)
-------- ---------- ---------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 0 20,000 27,100
-------- ---------- ---------
NET INCREASE IN CASH (5,990) (22) $(1,058)
=========
CASH AT BEGINNING OF PERIOD 7,048 100
-------- ----------
CASH AT END OF PERIOD $1,058 $78
======== ==========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
NOTES TO THE FINANCIAL STATEMENTS
MARCH 31, 2000, AND MARCH 31, 1999
NOTE A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated on December 31, 1998, under the laws of
the State of Nevada. The business purpose of the Company is primarily
to effect a merger or acquisition with a private entity. Secondarily,
such a merger may allow research and development of a wholesale and
retail winery.
The Company will adopt accounting policies and procedures based upon
the nature of future transactions.
NOTE B OFFERING COSTS
Offering costs are reported as a reduction in the amount of paid-in
capital received for sale of the shares.
NOTE C EARNINGS (LOSS) PER SHARE
Basic EPS Is determined using net income divided by the weighted
average shares outstanding during the period. Diluted EPS is computed
by dividing net income by the weighted average shares outstanding,
assuming all dilutive potential common shares were issued. Since the
Company has no common shares that are potentially issuable, such as
stock options, convertible securities or warrants, basic and diluted
EPS are the same.
NOTE D STOCK OFFERINGS
In March of 1 9g9, the Company completed the sale of 200,000 shares of
its common stock at $.10 per share for a total of $20,000. The
proceeds were to be used for the search for a merger or
acquisition candidate. The shares are considered by management to
be subject to rescission by the purchaser.
In October of 1999, the Company sold, by private placement,
50,000 shares of its common stock at S.20 per share for a total of
$10,000. The proceeds were to be used for working capital.
ROYSTON MANNOR ESTATES, INC.
( A DEVELOPMENT STAGE COMPANY )
NOTES TO THE FINANCIAL STATEMENTS
MARCH 31, 200O, AND MARCH 31, 1999
(continued)
NOTE E STOCK SUSPECT TO RESCISSION
In March of 1999, the Company completed the sale of 200,000 shares
of its common stock at $.10 per share for a total of $20,000. The
proceeds were to be used for the search for an unspecified merger or
acquisition candidate. Such shares are not eligible to be freely traded
and are subject to rescission. Therefore, the shares are reported in
the financial statements as "Common Stock Subject to Rescission".
