UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1 to
FORM 10-QSB/A
(Mark One)
| | [X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2007
OR
| | [_] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _____________ to _____________
Commission File No. 000-50366
(Exact name of Registrant as specified in its charter)
Nevada | 94-3409449 |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
| | |
| 6620 Lake Washington Blvd, Suite 301 | |
Kirkland, Washington, | 98033 |
| (Address of principal executive offices) | (Zip/Postal Code) |
(604)505-1085
(Telephone Number)
(415) 358-5548
(Fax Number)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] YES [ ] NO
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[X] YES [ ] NO
State the number of shares outstanding of each of the Issuer's classes of common equity, as of the latest practicable date. There were 9,970,000 common stock shares, par value $0.001, as of March 31, 2007.
TABLE OF CONTENTS
| PART I. | FINANCIAL INFORMATION | 3 |
| | | |
| Item 1 | Financial Statements | 3 |
| | Condensed Balance Sheets (Unaudited) - March 31, 2007 and December 31, 2006 | 3 |
| | Condensed Statements of Operations for the Three ended Months March 31, 2007 and 2006 and for the Period from October 12, 2001( Date of Inception) through March 31, 2007 (Unaudited) | 4 |
| | Condensed Statements of Cash Flows for the Three Months Ended March 31, 2007 and 2006 and for the Period from October 12, 2001 (Date of Inception) through March 31, 2007 (Unaudited) | 5 |
| | Notes to Condensed Financial Statements (Unaudited) | 6 |
| Item 2 | Plan of Operation | 7 |
| Item 3 | Controls and Procedures | 9 |
| | | |
| PART II | OTHER INFORMATION | 9 |
| | | |
| Item 1 | Legal Proceedings | 9 |
| Item 2 | Changes in Securities and Small Business Issuer Purchases of Equity Security | 9 |
| Item 3 | Defaults Upon Senior Securities | 9 |
| Item 4 | Submission of Matters to a Vote of Security Holders | 9 |
| Item 5 | Other Information | 9 |
| Item 6 | Exhibits and Reports on Form 8-K | 10 |
| | | |
| Signature | | 11 |
FORWARD-LOOKING STATEMENTS
In addition to historical information, this report contains forward-looking statements. Such forward-looking statements are generally accompanied by words such as "intends," "projects," "strategies," "believes," "anticipates," "plans," and similar terms that convey the uncertainty of future events or outcomes. The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in ITEM 2 of this Report, the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION." Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof and are in all cases subject to the Company's ability to cure its current liquidity problems. There is no assurance that the Company will be able to generate sufficient revenues from its current business activities to meet day-to-day operation liabilities or to pursue the business objectives discussed herein.
The forward-looking statements contained in this Report also may be impacted by future economic conditions. Any adverse effect on general economic conditions and consumer confidence may adversely affect the business of the Company.
Conscious Intention, Inc. undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Readers should carefully review the risk factors described in other documents the Company files from time to time with the Securities and Exchange Commission, including without limitation those identified in the "Risk Factors" section of the Company's Registration Statement filed with the Securities and Exchange Commission (the "SEC") on May 14, 2003 on Form SB-2/A.
Part I - Financial Information
CONSCIOUS INTENTION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEETS
(UNAUDITED)
| | | March 31, | | December 31, | |
| | | 2007 | | 2006 | |
ASSETS | | | | | |
| | | | | | |
| CURRENT ASSETS | | | | | |
| Cash | | $ | 2,143 | | $ | 2,143 | |
| | | | | | | | |
| Total Assets | | $ | 2,143 | | $ | 2,143 | |
| | | | | | | | |
LIABILITIES AND STOCKHOLDERS' DEFICIT | | | | | | | |
| | | | | | | | |
| CURRENT LIABILITIES | | | | | | | |
| Accounts payable | | $ | 6,696 | | $ | 4,669 | |
| | | | | | | | |
| Total Current Liabilities | | | 6,696 | | | 4,669 | |
| | | | | | | | |
| STOCKHOLDERS' DEFICIT | | | | | | | |
| | | | | | | | |
| Common stock, par value $.001, 10,000,000 shares authorized, 9,970,000 issued and outstanding | | | 9,970 | | | 9,970 | |
| Paid in capital | | | 59,030 | | | 59,030 | |
| Deficit accumulated during the development stage | | | (73,553 | ) | | (71,526 | ) |
| | | | | | | | |
| Total Stockholders' Deficit | | | (4,553 | ) | | (2,526 | ) |
| | | | | | | | |
| | | $ | 2,143 | | $ | 2,143 | |
SEE ACCOMPANYING NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
CONSCIOUS INTENTION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
| | | For the three months ended | | From October 12, 2001 (date of inception) through | |
| | | March 31, | | March 31, | | March 31, | |
| | | 2007 | | 2006 | | 2007 | |
| | | | | | | | |
| REVENUES | | $ | - | | $ | - | | $ | - | |
| | | | | | | | | | | |
| EXPENSES | | | | | | | | | | |
| Selling, general and administrative | | | 2,027 | | | 2,125 | | | 91,121 | |
| Interest income | | | - | | | - | | | 272 | |
| | | | | | | | | | | |
| Total expenses | | | 2,027 | | | 2,125 | | | 91,393 | |
| | | | | | | | | | | |
| NET LOSS from operations | | $ | (2,027 | ) | $ | (2,125 | ) | $ | (91,393 | ) |
| | | | | | | | | | | |
| Gain on forgiveness of loan | | | - | | | - | | | 17,810 | |
| Interest income | | | - | | | - | | | 30 | |
| | | | | | | | | | | |
| Net loss | | $ | (2,027 | ) | $ | (2,125 | ) | | (73,553 | ) |
| | | | | | | | | | | |
| NET LOSS PER SHARE | | $ | (0.00 | ) | $ | (0.00 | ) | | | |
| | | | | | | | | | | |
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | | | 9,970,000 | | | 9,970,000 | | | | |
SEE ACCOMPANYING NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
CONSCIOUS INTENTION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMEMT OF CASHFLOWS
(UNAUDITED)
| | | For the three months ended March 31, | | From October 12, 2001(inception) to March 31, | |
| | | 2007 | | 2006 | | 2007 | |
| | | | | | | | |
OPERATING ACTIVITIES | | | | | | | |
| Net loss from operations | | $ | (2,027 | ) | $ | (2,125 | ) | $ | (73,553 | ) |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Changes in operating assets and liabilities: | | | | | | | | | | |
| Gain on forgiveness of debt | | | - | | | - | | | (17,810 | ) |
| Deferred offering costs | | | - | | | - | | | 23,844 | |
| Increase (decrease) in accounts payable | | | 2,027 | | | (885 | ) | | (7,148 | ) |
| | | | | | | | | | | |
| Net cash provided by (used by) operating activities | | | - | | | (3,010 | ) | | (74,667 | ) |
| | | | | | | | | | | |
FINANCING ACTIVITIES | | | | | | | | | | |
| Increase in receivable from related party | | | - | | | - | | | (1,690 | ) |
| Proceeds from receivable from related party | | | - | | | - | | | 1,690 | |
| Payments on payable to related party | | | - | | | - | | | (4,700 | ) |
| Proceeds from issuance of common stock | | | - | | | - | | | 14,000 | |
| Proceeds from shareholder advance converted to equity | | | - | | | - | | | 55,000 | |
| Increase (decrease) in payable to related party | | | - | | | - | | | 12,510 | |
| | | | | | | | | | | |
| Net cash provided by financing activities | | | - | | | - | | | 76,810 | |
| | | | | | | | | | | |
| Net increase (decrease) in cash | | | - | | | (3,010 | ) | | 2,143 | |
| | | | | | | | | | | |
| Cash, Beginning of period | | | 2,143 | | | 30,000 | | | - | |
| | | | | | | | | | | |
| Cash, End of period | | $ | 2,143 | | $ | 26,990 | | $ | 2,143 | |
SEE ACCOMPANYING NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
CONSCIOUS INTENTION, INC.
(a Development Stage Company)
Notes to Condensed Financial Statements (Unaudited)
March 31, 2007
Organization and Nature of Operations— On October 12, 2001, Conscious Intention, Inc. (“the Company”) was organized under the laws of the State of Nevada. The Company is considered a development stage enterprise and is in the process of raising capital to fund operations. As such, the Company has since inception spent most of its efforts in developing its business plan, constructing core materials for eventual sale to customers and in raising capital to fund its operations. The Company has relied upon cash flows from equity issuances and an increase in accounts payable to sustain operations. At inception, The planned operations of the Company consisted of selling a business system of materials, tools and on-line, internet based support services for individuals wishing to open a business as an executive coach or career counselor. The Company has established its year-end as December 31st. The Company has had no revenues from any source to date. In November, 2005, the Company changed its business model to provide management consulting services in connection with the resignation of the previous President and Chief Executive Officer and the appointment of a new Chief Executive Officer.
Interim Financial Statements — In the opinion of management, the accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented have been included in the accompanying condensed financial statements. Operating results for the three months ended March 31, 2007 are not necessarily indicative of the results that may be expected for the year ended December 31, 2007. These condensed financial statements should be read in conjunction with the Company’s annual financial statements and notes thereto contained in the Company’s December 31, 2006 Annual Report on Form 10-KSB.
Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts in the financial statements and the accompanying notes. Actual results could differ from those estimates.
Business Condition — The Company has not yet been able to execute its business plan. As a result, the Company has negative working capital, negative equity, recurring operating losses and negative cash flows from operations since inception. This situation raises substantial doubt about its ability to continue as a going concern. The Company plans to fund its operations by any of the following: issue debt securities, issue equity securities, or loans from related parties. Success in these efforts is not assured. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.
Item 2. Plan of Operation
The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements.
Overview
Although Conscious Intention was originally incorporated for the purposes of developing internet based software products for the executive coaching market, the company was never successful in completing a product or attracting customers and abandoned this business in early 2005. In November of 2005, Mr. Andrew Hamilton replaced CEO Sylva Leduc and began to implement a plan to have the Company function in the area of management consulting. The Company will now provide management consulting services to corporations through the efforts of Mr. Hamilton and other consultants he intends to hire through recruiting or acquisition. Mr. Hamilton has identified five key areas of focus in the management consulting arena which are consumer electronics, oil and gas, entertainment and media, software and internet technology and life sciences. The Company is now targeting these areas to acquire new consulting businesses. By the end of December 2007, the Company intends to employ a total of three management consultants, including Mr. Hamilton. In addition, the Company has a growth plan to engage consultants on the Indian Subcontinent in order to take advantage of large talent pools and relatively low wages that are prevalent there. Mr. Hamilton is also searching for acquisition opportunities, including the purchase of other small management consultancies and any other business in the five key areas previously identified which could add to the Company’s strengths.
Conscious Intention's principal products and services
Conscious Intention intends to provide high valued added management consultancy services to corporations in five key strategic growth industries, consisting of consumer electronics, oil and gas, entertainment and media, software and internet technology and life sciences. These services will be billed on either an hourly or flat fee engagement basis. The Company does not currently have any clients.
Distribution and marketing methods
The Company markets its services through the personal sales efforts of Chief Executive Officer Andrew Hamilton. Mr. Hamilton has a substantial list of former and current clients to whom he will be marketing the Company’s services. Mr. Hamilton also intends to hire a sales and marketing manager who will be focused on attracting new customers by means of internet marketing, direct mailing, conference presentations and live telephone solicitations of referrals from Mr. Hamilton’s existing personal network.
Status of products and services
The Company intends to offer management consultancy services.
Business Combination
We are actively evaluating opportunities for growth through a business combination by acquiring one or more small consultancy firms, in the United States, India or China or by acquiring a business in one of the company’s five key strategic industry segments of consumer electronics, oil and gas, entertainment and media, software and internet technology and life sciences. There can be no assurance that it would be available under suitable terms and conditions.
Revenues
Conscious Intention has derived no revenue to date. The Company has plans to develop revenues through consulting fees or through a business combination, though no such consulting arrangements currently exist and no such business combination targets have been identified.
Sales and marketing
We expect to spend $5,000-$25,000 on sales and marketing in the quarter ending June 30, 2007. We did not spend any money on sales and marketing during the three months ended March 31, 2007.
General and administrative
General and administrative expenses were $2,027 during the three months ending March 31, 2007 and $2,125 during the three months ending March 31, 2006.
Financial Condition
For the three-month period ended March 31, 2007, Conscious Intention had a net loss of $2,027, while for the period ended March 31, 2006, the Company had a net loss of $2,125. Also, at March 31, 2007, the Company had accumulated deficits of $73,553 while at December 31, 2006, the Company had accumulated deficits of $71,526.
Conscious Intention's current financial condition means it is critical to acquire revenue through consulting engagements.
Liquidity and capital resources
Net cash used in operating activities for the three-month period ended March 31, 2007 and 2006 was $0 and $3,010 respectively. As of March 31, 2007, we had $2,143 in cash.
Net cash provided by financing activities was $0 for the three-month period ended March 31, 2007. Net cash provided by financing activities was $0 for the period ended March 31, 2006.
As of March 31, 2007 our principal commitments consisted of our obligations outstanding under accounts payable. We have no material commitments for capital expenditures. We expect no significant capital expenditures or lease commitments during the next fiscal quarter.
We believe that our current cash balances are insufficient to meet our working capital and capital expenditure requirements. We have limited working capital. We will need to receive an infusion of capital from our chief executive officer, revenue from consulting or receive funding from another source in order to continue to seek a business combination.
We need to secure additional cash as soon as possible. We have no current plan to find such cash other than through consulting revenue, a business combination or loans from our chief executive officer or shareholders, which cannot be assured.
Conscious Intention's short-term prospects are challenging considering our lack of financial resources, however, as we have relatively low monthly operating expenses and anticipate revenues from consulting services during the next quarter, our short-term prospects should improve significantly if such revenue is received.
Cash requirements
Presently, without additional cash, we will not be able to grow our operations significantly, however we have commenced seeking consulting revenue and believe we have sufficient cash to last until we receive consulting revenue. We have limited working capital. Our continued operation is therefore dependent upon our ability to secure additional cash through revenue or financing. We presently have no arrangements or understandings with any investors or potential investors with respect to an investment in Conscious Intention. We have not decided at what price or under what terms we will raise such additional funds. We are actively seeking a business combination as a source of funds, though no assurance can be given that we will be successful in finding such a combination.
Research and development
We have no present intention to spend any money on research and development over the next 12 months.
Plant and equipment
We currently have an office in the home of our chief executive officer, Andrew Hamilton, in Vancouver, British Columbia. We will be leasing office space in India and in the United States by September 30, 2007. We expect the annual office expenses from these offices to be about $15,000.
Employees
We have one full-time employee currently, however, we plan to have at least three employees by September 30, 2007 and intend to have at least 12 consulting employees and 3 support persons by December 31, 2007.
The Company’s executive offices are currently located in the residence of our chief executive officer in Vancouver, British Columbia. The company’s telephone number is (604)505-1085. The company intends to move offices and change phone numbers within the next 60 days.
ITEM 3. Controls and Procedures
(a) Evaluation of disclosure controls and procedures.
Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934 as of the end of the period covered by this Quarterly Report on Form 10-Q. The evaluation included certain internal control areas in which we have made and are continuing to make changes to improve and enhance controls. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Based on that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.
(b) Changes in internal control over financial reporting.
There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Not Applicable
Recent Sales of Unregistered Securities
In September 2003 we issued registered common stock with a deemed value of $.50 per share to four investors, James Price, Tim Rieu, Aero Financial, Inc., and Nixel Holdings LLC. We received $10,000 in gross proceeds and 20,000 shares were issued. The proceeds received were used to pay outstanding offering costs. The shares were issued to accredited investors pursuant to exemptions from registration as set out in Rule 506 of Regulation D under the Securities Act. In September, 2005, we sold 5,950,000 common shares to chief executive officer Andrew Hamilton for a cash investment of $30,000 and payment of our outstanding accounts payable of $25,000.
Not Applicable
Not Applicable
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
None during the quarter ended March 31, 2007.
List of Exhibits
| | 3.1 | Articles of Incorporation of registrant as filed previously with the Commission on Form SB-2, dated April 12, 2002. |
| | 3.2 | Bylaws of registrant as filed previously with the Commission on Form SB-2, dated April 12, 2002. |
| | 31.1 | Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 |
| | 31.2 | Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 |
| | 32.1 | Certification of the Company's Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| | 32.2 | Certification of the Company's Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
(b) REPORTS ON FORM 8-K
The following reports on Form 8-K were filed by the Company during the fiscal quarter ended March 31, 2007:
None
SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | Conscious Intention, Inc. |
| | |
| | |
| | |
| Dated: June 6, 2007 | /s/ Andrew Hamilton |
| | Andrew Hamilton |
| | Chief Executive Officer |
| | (Duly Authorized Officer and Principal Financial and Accounting Officer) |
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