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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 Page 1 of 12
Sequentially
FORM 10-Q Numbered Document
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended Commission File Number
March 31, 1996 33-26531-LA
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COMMERCIAL LABOR MANAGEMENT, INC.
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(Exact Name of Registrant as specified in its Charter)
Nevada 88-241079
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(State or other Jurisdiction of I.R.S. Employer
Incorporation or Organization Identification No.)
208 Mira Mar Avenue, Suite One, Long Beach, California 90803
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(Address of Principal Executive Offices) (Zip Code)
(562) 987-5443
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(Registrant's Telephone Number, including Area Code)
Indicate by check mark whether the Registrant (i) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (ii) has been subject to
such filing requirements for the past 90 days.
Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes
of Common Stock, as for the latest practicable date.
Common Stock, $.05 par value 9,264,584
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Title of Class Number of Shares Outstanding
at September 30, 1995
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FINANCIAL STATEMENTS
ITEM 1. FINANCIAL STATEMENTS
COMMERCIAL LABOR MANAGEMENT, INC.
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COMMERCIAL LABOR MANAGEMENT, INC.
BALANCE SHEET
SEPTEMBER 30, 1995
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ASSETS
1995
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CURRENT ASSETS
Note receivable $180,000
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TOTAL CURRENT ASSETS 180,000
FIXED ASSETS
Tax benefit 132,326
Land 380,000
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TOTAL FIXED ASSETS 512,326
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TOTAL ASSETS $692,326
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT
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COMMERCIAL LABOR MANAGEMENT, INC.
BALANCE SHEET
SEPTEMBER 30, 1995
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LIABILITIES AND STOCKHOLDERS' EQUITY
1995
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CURRENT LIABILITIES:
Accounts payable $0
Note payable for land $ 88,289
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TOTAL CURRENT LIABILITIES 88,289
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TOTAL LIABILITIES 88,289
STOCKHOLDERS' EQUITY:
Preferred convertible stock, $1,000 par value
1,000 share authorized, 180 issued & outstanding 180,000
Common stock, $.05 par value, 15,000,000 shares
authorized, 9,264,584 issued and outstanding 51,813
Paid-in Capital 864,217
Accumulated deficit (491,993)
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TOTAL STOCKHOLDER'S EQUITY 604,037
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TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $692,326
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT
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COMMERCIAL LABOR MANAGEMENT, INC.
STATEMENT OF INCOME
SEPTEMBER 30, 1995
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1995
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EXPENSES:
Bad debt expense $0
Professional fees 0
Employee benefits 0
Interest expense 0
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TOTAL EXPENSES 0
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NET INCOME (LOSS) DISCONTINUED OPERATIONS 0
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LOSS BEFORE TAXES 0
INCOME TAX BENEFIT 0
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NET INCOME (LOSS) 0
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Weighted Average Number of
Shares Outstanding 578,524
Loss Par Share
of Common Stock 0.00
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT
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COMMERCIAL LABOR MANAGEMENT, INC.
STATEMENT OF CASH FLOW
SEPTEMBER 30, 1995
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1995
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NET CASH FLOWS FROM OPER. ACTIVITIES:
Cash received from customers $0
CASH EXPENSES:
Cash paid to suppliers 0
Cash paid for operating expenses 0
Interest paid 0
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CASH PAID FOR OPERATING ACTIVITIES 0
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NET CASH FROM OPERATING ACTIVITIES 0
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CASH FLOWS USED IN INVESTING ACTIVITIES
Purchase of leasehold improvements 0
Purchase of equipment 0
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NET CASH USED IN INVESTING ACTIVITIES 0
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CASH FLOW FROM FINANCING ACTIVITIES:
Common Stock, Treasury Stock 0
Paid-in Capital 0
Cash loss on sale of operations 0
Proceeds from notes payable 0
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NET CASH PROVIDED BY FINANCING ACTIVITIES 0
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NET INCREASE (DECREASE) IN CASH 0
CASH AT BEGINNING OF YEAR 0
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CASH AT END OF YEAR $0
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT
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COMMERCIAL LABOR MANAGEMENT, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FROM DECEMBER 31, 1993 TO SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
Common Stock Preferred Stock
--------------------------------------------- Additional Treasury
Number Number Paid-in Stock Accumulated
of Shares Amount of Shares Amount Capital & Adj's Deficit Total
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE-DEC. 31, 1993 800,000 40,000 219,192 (171,685) 105,287 364,479
1994 ACTIVITY
Exercise of warrants 50,000
Two-for-one split on 3/1/94 850,000
Warrants exercised 197,867 11,813 473,340 171,685 656,838
Adjust stock to reflect the 1993
SEMAC debt exchange (395,141)
Sale of operations (619,200) 171,685
Loss for the year 12/31/94 (590,767) (590,767)
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BALANCE-DEC. 31, 1994 883,526 $51,813 $864,217 0 ($485,480) $430,550
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1995 ACTIVITY
Three-for-one reverse split 3/20 (589,018)
1995 Net Transactions 8,970,076
Issuance of Preferred Stock 180,000 180,000 180,000
Loss ended 9/30/95 (6,513) (6,513)
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BALANCE-SEPT. 30, 1995 9,264,584 $51,813 180,000 $180,000 $864,217 0 ($491,993) $604,037
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</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
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COMMERCIAL LABOR MANAGEMENT
NOTES TO THE FINANCIAL STATEMENT
SEPTEMBER 30, 1995
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
GENERAL:
Commercial Labor Management, Inc. (formerly XL Corp.) is a Nevada
Corporation (the "Company") was organized October 19, 1988.
The Company was originally incorporated in Nevada under the Tokyo Raiders
on October 19, 1988. In 1990, the Company acquired certain rights to a
pizza franchise and changed its name to Club USPN, Inc. In June of 1993,
the Company acquired Sono International, Inc., but those operations were
discontinued and the shares of Sono were sold to the original
shareholders of Sono. In March of 1995 the Board approved the merger with
Commercial Labor Management which was handled as a reverse merger, and
also approved a name change to Commercial Labor Management. However, that
merger was rescinded and never completed. The Company is currently
seeking other potential mergers or acquisitions.
INCOME TAX REPORTING:
The Company files a corporate tax return in the U.S.
EARNINGS PER SHARE:
The calculations of earnings per share was determined by dividing the net
income or loss by the computed weighted average number of common shares
outstanding during the applicable period, adjusted for the 1 for 3 reverse
split effected in March 20, 1995. The weighted average number of shares
outstanding for 1995 is 578,524.
INCOME TAXES:
In December 1992 the Financial Accounting Standards Board issued
Statement of Accounting Standards Number 109, "Accounting for Income
Taxes" (FASB 109). Adoption of FASB 109 is required for fiscal years
beginning after December 15, 1992. The Company follows the requirements
set forth in FASB 109.
2. PAID IN CAPITAL:
Paid in capital is made up in part by contributions of office furniture &
equipment, manufacturing equipment, trade receivable, and accounts
payable in exchange for common stock. Common stock was issued to
Shareholder's of record in exchange for these net assets. Also, in the
fourth quarter of 1994 the Company issued some common stock to
individuals to whom money was owed for professional services rendered,
prior to the sale-back of 9/30/94.
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COMMERCIAL LABOR MANAGEMENT
NOTES TO THE FINANCIAL STATEMENT
SEPTEMBER 30, 1995
3. CAPITAL STOCK:
PREFERRED CONVERTIBLE STOCK
Each share of Series A Convertible Preferred Stock is convertible, at
certain times or on the occurrence of certain events, into shares of Company
Common Stock valued at 70% of the Market Place. The Company authorized 1,000
shares and there were 180 shares issued and outstanding as of September 30,
1995.
COMMON STOCK
The authorized capital stock of the company consists of Common Stock.
Authorized shares of stock at September 30, 1995 were 15,000,000. There are
9,264,585 shares outstanding as of September 30, 1995.
The issuance for the CLM acquisition and anti-dilutive clause were made
on 9/30/95.
4. TAX BENEFIT:
The Company has a loss carryforward in the amount of $615,784 available
to offset future taxable income. These losses expire as they offset income
or can be carryforward for a maximum of 15 years. The Company believes it
will use the credit before it expires. However, no estimates of future
income are available so the benefit is reflected as a long-term asset.
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
BACKGROUND:
On March 21, 1995, the Company entered into an Agreement and Plan of
Reorganization with Commercial Labor Management, Ltd. ("CLM") pursuant
to which it acquired 100% of the issued and outstanding stock of CLM.
Effective July 1, 1995, the Company and CLM rescinded the acquisition
in its entirety. Pursuant to the Rescission Agreement, the owner of
CLM tendered back to the Company for cancellation all 1,928,330 shares
of the Company's common stock issued in exchange for 5,000,000 shares
of common stock and 2,000,000 shares of preferred stock in CLM, which
has been tendered by the Company back to the owner of CLM. The owner
of CLM also agreed to bear all of the costs incurred by the Company in
connection with the attempted acquisition of CLM and subsequent
rescission of the transactions. The Company received a noninterest
bearing demand note for $180,000 from the owner of CLM as payment of
the costs.
RESULTS OF OPERATION:
Because of the rescission of the acquisition of CLM
and treatment of funds utilized by the Company as an advance, the
Company did not incur operating expenses or earn revenues during the
fiscal quarter ended September 30, 1995.
LIQUIDITY AND CAPITAL RESOURCES:
In May 1995 the Company raised $180,000 pursuant to the private
placement of 180 shares of Series A Convertible Preferred Stock
pursuant to Rule 506 of Regulation D under Section 4(2) of the
Securities Act of 1933, as amended. The funds were utilized in
connection with the attempted acquisition of CLM by the Company,
and are reflected as a note receivable payable by the owner of CLM
to the Company for $180,000. The Company had no working capital
as of September 30, 1995, and no assurance that its note receivable
for $180,000 will be repaid. The Company presently has no operating
businesses and no sources of capital or financing. There is no
assurance that the Company will be able to obtain capital or
financing, or that it will be able to make a business acquisition
in the future.
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PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None
Item 2. CHANGES IN SECURITIES
None
Item 3. DEFAULTS UPON SENIOR SECURITIES
None
Item 4. SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS
None
Item 5. OTHER INFORMATION
None
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None.
(b) Reports on Form 8-K
None.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Date: October 15, 1995 By: /s/ Edward L. Torres
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President and Chief Financial Officer
(chief financial officer and
accounting officer and duly authorized
officer)
Date: October 15, 1995 By: /s/ Mark French
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Secretary (corporate secretary and
duly authorized officer)
<TABLE> <S> <C>
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 180,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 180,000
<PP&E> 380,000
<DEPRECIATION> 0
<TOTAL-ASSETS> 692,326
<CURRENT-LIABILITIES> 88,289
<BONDS> 0
0
180,000
<COMMON> 51,813
<OTHER-SE> 372,224
<TOTAL-LIABILITY-AND-EQUITY> 693,326
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
