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
[1]
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.
[2]
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.
[3]
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.
[4]
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.
[5]
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.
[6]
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
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.
[7]
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.
[8]
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.
[9]
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 Royston 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.
[10]
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.
[11]
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.
[12]
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 dentifying 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 obligated 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 a disadvantage with other companies having larger
technical staffs, established market shares and greater financial backing.
[13]
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 serves 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 is 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.
[14]
Information as to the director and executive officer of the Royston Mannor
Estates, Inc. is as follows:
<TABLE>
Name Age Position
<S> <C> <C>
Harvey Makaiwi 48 President, Sole
Officer and Director
</TABLE>
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 formal 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 other than as it relates to
Mr. Makaiwi's fiduciary duty as described below.
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. 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.
[15]
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.
[16]
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.
[17]
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 unrestricted 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.
[18]
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.
[19]
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.
[20]
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.
EXHIBITS
<TABLE>
<S> <C>
3.1 Articles of Incorporation
Incorporated by reference in Company's Form 10SB filed May 15th, 2000
3.2 By-Law 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. Incorporated by reference in Company's
From 10SB/A filed on July 11, 2000.
</TABLE>
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.
[21]
Royston Mannor Estates, Inc.
(A Development Stage Company)
Finacial Statements
June 30, 2000 and June 30, 1999
Table of Contents
Page Number
Independent Accountant's 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
Statement of Cash Flows 5
Notes to the Financial Statements 6-7
David E. Coffey
3651 Lindell Road, Suite A
Las Vegas, NV 89103
Independent Auditor's Report
To the Board of Directors and Stockholders
of Royston Mannor Estates, Inc.
Las Vegas, NV
I have audited the accompanying balance sheets of Royston Mannor Estates, Inc.,
(a development stage company) as of June 30, 2000, and June 30, 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 reception) to June 30, 1999. These statements are
the responsibility of Royston Mannor Estates, Inc.'s management. My
responsiblity 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 June 30, 2000, and June 30, 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, CPA
Las Vegas, Nevada
May 19, 1999
<TABLE>
Royston Mannor Estates, Inc.
(A Development Stage Company)
Balance Sheets
<CAPTION>
June 30, June 30, December 31,
2000 1999 1999
-------- -------- -------------
<S> <C> <C> <C>
ASSETS
Cash $1,058 $48 $7,048
------- ------ ---------
Total Assets $1,058 $48 $7,048
======= ====== =========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Accounts Payable $10,100 $400 $400
------- ------ ------
Total Liabilities 10,100 400 400
Common Stock subject
to Recission:
Par value of 200,000 shares
issued in March 1999 200 200 200
Additional Paid In Capital 19,800 19,800 19,800
------- -------- -------
Common Stock Subject
to Recission 20,000 20,000 20,000
Stockholders' Equity
Common Stock,
authorized 50,000,000
sharesat $.001 par value,
issuedand outstanding
150,000 shares and 100,000
shares, respectively 150 100 150
Additional Paid in Capital 6,950 0 6,950
Deficit accumulated during
the development stage (36,142) (20,452) (20,452)
--------- --------- ---------
Total Stockholders' Deficit (29,042) (20,352) (13,352)
Total Liabilities and
Stockholders' Equity $1,058 $48 $7,048
========= ========= ==========
</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 DEVELOPMENT STAGE
(WITH CUMULATIVE FIGURES FROM INCEPTION)
<CAPTION>
From Inception,
Jan 1, 2000 Jan 1, 1999 December 31, 1998
to to to
June 30, 2000 June 30, 1999 June 30, 2000
------------- ------------- -----------------
<S> <C> <C> <C>
Income $0 $0 $0
Expenses
Organizational expense 0 0 400
Consulting 5,990 20,000 25,990
Professional fees 9,700 0 9,700
Office expenses 0 52 52
--------- --------- ----------
Total expenses 15,690 20,052 36,142
Net loss (15,690) (20,052) $(36,142)
==========
Retained earnings,
beginning of period (20,452) (400)
---------- ----------
Deficit accumulated during
development stage $(36,142) $(20,452)
========== ===========
Earnings (loss) per share
assuming dilution:
Net loss $(0.04) $(.009) $(0.12)
========== ========== ===========
Weighted average shares
outstanding 350,000 233,333 292,105
========== ========== ===========
</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
JUNE 30, 2000
<CAPTION>
Common Stock Additional Total
Shares Amount Paid in
Capital
-------- ------- --------- -------
<S> <C> <C> <C> <C>
Balance
Decemeber 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)
Les net loss 0 0 0 (20,052)
------- ------ -------- ---------
Balance
December 31, 1999 150,000 $150 $6,950 $(13,352)
Less net loss 0 0 0 (15,690)
-------- ------- -------- ---------
Balance
June 30, 2000 150,000 150 6,950 (29,042)
======== ======= ======== =========
</TABLE>
The accompanying notes are an intregal 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 Dec 31, 1998
to to to
June 30, 2000 June 30, 1999 June 30,2000
------------- ------------- ---------------
<S> <C> <C> <C>
CASH FLOWS PROVIDED BY
OPERATING ACIVITIES
Net loss $(15,690) $(20,052) $(36,142)
Non-cash itms included
in net loss 0 0 0
Adjustments to reconcile
net loss to cash used by
operating activity
Accounts payable 9,700 0 10,100
--------- ---------- ----------
NET CASH PROVIDED BY
OPERATING ACTIVITIES (5,990) (20,052) (26,042)
CASH FLOWS USED IN
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 recission 0 200 200
Paid in Capital
subject to recission 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) (52) $1,058
=========
CASH AT BEGINNING
OF PERIOD 7,048 100
------- ------------
CASH AT END OF PERIOD $1,058 $48
======= ============
</TABLE>
The accompanying notes are in an intregal part of these financial statements.
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2000, AND JUNE 30, 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 privated 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 1999, the Company completed sale of 200,000 shares of its
common stock at $0.10 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 recission by
the purchaser.
In October of 1999, the Company sold, by private placement, 50,000
shares of its common stock at $.20 per share for a total of $10,000.
The proceeds were to be used for working capital.
NOTE E
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 recission. Therefore, the shares are reported in the
financial statements as "Common Stock Subject to Recission."
ROYSTON MANNOR ESTATES, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
DECEMBER 31, 1999, AND
DECEMBER 31, 1998
TABLE OF CONTENTS
PAGE NUMBER
INDEPENDENT ACCOUNTANT'S REPORT 1
FINANCIAL STATEMENT
Balance Sheet 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
David E. Coffey
Certified Public Accountant
3651 Lindell Road, Suite A
Las Vegas, NV 89103
(702) 871-3979
INDEPENDENT ACCOUNTANT'S REPORT
To the Board of Directors and Stockholders
of Royston Mannor Estates, Inc.
Las Vegas, Nevada
I have audited the accoumpanying balance sheets of Royston Mannor
Estates, Inc., (a development stage company) as of December 31, 1999,
and December 31, 1998, and the related statements of operations, cash
flows, and changes in stockholders' equity for the period from December 31,
1998, (date of inception) to December 31, 1999. 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 December 31, 1999, and December 31, 1998, 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
February 21, 2000
<TABLE>
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
<CAPTION>
DEC. 31, 1999 DEC. 31, 1998
<S> <C> <C>
ASSETS
Cash $ 7,048 $ 100
------------ ------------
$ 7,048 $ 100
============ ============
LIABILIES & STOCKHOLDERS' EQUITY
Accounts payable $ 400 $ 400
------------ -------------
Total Liabilities 400 400
Stockholder's Equity
Common stock, authorized 50,000,000
shares at $.001 par value, issued and
outstanding 350,000 shares and
100,000 shares, respectively 350 100
Additional paid-in capital 26,750 0
Deficit accumulated during the
development stage (20,452) (400)
------------- --------------
Total Stockholders' Equity 6,648 (300)
Total Liablilites and Stockholder's Equity $ 7,048 $ 100
========== ==============
</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 Cumulative Figures From Inception)
<CAPTION>
From Inception
Jan. 1, 1999, to Dec. 31, 1998 to Dec. 31, 1998, to
Dec. 31, 1999 Dec. 31, 1998 Dec. 31, 1999
---------------- ---------------- -----------------
<S> <C> <C> <C>
Income $ 0 $ 0 0
Expenses
Organizational expense 0 400 400
Consulting 20,000 0 20,000
Office expenses 52 0 52
---------------- ---------------- -----------------
Total expenses 20,052 400 20,452
Net loss (20,052) (400) $ (20,452)
=================
Retained earnings,
beginning of period (400) 0
---------------- ----------------
Deficit accumulated during
the development stage $ (20,452) $ (400)
================ =================
Earnings (loss) per share
assuming dilution:
Net loss $ (0.07) $ 0.00 $ (0.08)
================ ================= ================
Weighted average shares
outstanding 279,167 100,000 265,385
================ ================= ================
</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
DECEMBER 31, 1999
<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
March, 1999 200,000 200 19,800 20,000
Less offering costs 0 0 (3,000) (3,000)
Issuance of common stock for cash
October, 1999 50,000 50 9,950 10,000
Less net loss 0 0 0 (20,052)
-------- ------- ---------- ---------
Balance,
December 31, 1999 350,000 $ 350 $ 26,750 $ 6,648
======== ======== =========== ==========
</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, 1999, to Dec. 31, 1998, to Dec. 31, 1998, to
Dec. 31, 1999 Dec. 31, 1998 Dec. 31, 1999
---------------- ----------------- -----------------
<S> <C> <C> <C>
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES
Net Loss $ (20,052) $ (400) $ (20,452)
Non-cash items included
in net loss 0 0 0
Adjustments to reconcile
net loss to cash used by
operating activity
Accounts Payable 0 400 400
----------------- ------------------ ----------------
NET CASH PROVIDED BY
OPERATING ACTIVITIES (20,052) 0 (20,052)
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 250 100 350
Paid-in capital 29,750 0 29,750
Less offering costs (3,000) 0 (3,000)
-------------------- ------------------ --------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 27,000 100 27,100
-------------------- ------------------ --------------
NET INCREASE IN CASH 6,948 100 $ 7,048
==============
CASH AT BEGINNING OF
PERIOD 100 0
-------------------- -------------------
CASH AT END OF PERIOD $ 7,048 $ 100
==================== ===================
</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
DECEMBER 31, 1999, AND DECEMBER 31, 1998
NOTE A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated on December 31, 1998, under
the laws of the State of Neveda. The business purpose of
the Company is to market specialty wines in the United States.
The Company will adopt accounting policies and procedures
based upon the nature of future transactions.
NOTES B OFFERING COSTS
Offering costs are reported as a reduction in the amount of
paid-in capital received for sale of the shares.
NOTES 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.
NOTES D STOCK OFFERINGS
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
marketing of specialty wines.
In October of 1999, the Company sold, by private placement,
50,000 shares of its common stock at $.20 per share for a total of
$10,000. The proceeds were to be used for working capital.
