UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended May 1, 2007
Commission File Number 0-13039
UNIVERSAL SERVICES GROUP, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 62-1133652 |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |
| | |
| P.O. Box 1355 | |
| Englewood Cliffs, New Jersey | 11580 |
| (Address of principal executive offices) | (Zip code) |
Registrant's telephone number, including area code: 201-634-8700
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 shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
YES o NO x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES x NO o
As of August 15, 2007, 5,354,376 shares of common stock par value, $.06 per share were outstanding.
UNIVERSAL SERVICES GROUP, INC.
FORM 10-QSB
QUARTERLY REPORT
For the Period Ended May 1, 2007
INDEX
| | FINANCIAL INFORMATION | | 3 |
| | | | | |
| Item 1: | | Financial Statements | | 3 |
| | | | | |
| Item 2: | | Management's Discussion and Analysis of Financial Condition and Results of Operations | | 8 |
| | | | | |
| Item 3: | | Controls and Procedures | | 8 |
| | | | | |
| Part II: | | OTHER INFORMATION | | 9 |
| | | | | |
| SIGNATURES | | 10 |
FORWARD-LOOKING STATEMENTS
Except for historical information, the statements contained in this Form 10-QSB are "forward looking" statements about our expected future business and financial performance. These statements, which appear throughout this Form 10-QSB, include statements as to our intent, belief or current expectations or projections with respect to our future operations, performance or financial position, involve known and unknown risks, including, among others, risks resulting from economic and market conditions, forecasting accuracy in our business plan and projected costs. We are subject to these and many other uncertainties and assumptions contained elsewhere in this Form 10-QSB.
We base our forward-looking statements on information currently available to us, and we assume no obligation to update forward-looking statements, except as otherwise required under the applicable federal securities laws. Our actual operating results and financial performance may prove to be very different from what we have predicted as of the date hereof due to certain risks and uncertainties. Accordingly, you are cautioned not to place too much relevance on such forward-looking statements, which speak only as of the date made.
Part I Financial Information
Item 1. Financial Statements.
Universal Services Group, Inc. and Subsidiaries |
Consolidated Balance Sheets |
(UNAUDITED) |
| | | May 1, | | November 1, | |
| | | 2007 | | 2006 | |
| | | (Unaudited) | | (Unaudited) | |
Assets: | | | | | |
| Current Assets: | | | | | |
| Cash and Cash Equivalents | | $ | 0 | | $ | 0 | |
| Accounts Receivable, Net | | | 0 | | | 0 | |
| Accounts Receivable-Sale of Assets | | | 0 | | | 0 | |
| Other Current Assets | | | 0 | | | 0 | |
| | | | | | | | |
| Total Current Assets | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Property & Equipment, Net | | | 0 | | | 0 | |
| | | | | | | | |
| Other Assets | | | 0 | | | 0 | |
| | | | | | | | |
| Total Assets | | $ | 0 | | $ | 0 | |
| | | | | | | | |
Liabilities: | | | | | | | |
| | | | | | | | |
| Current Liabilities | | | | | | | |
| Notes Payable-Bank | | $ | 0 | | $ | 0 | |
| Current Maturities of Long Term Debt | | | 0 | | | 0 | |
| Accounts Payable-Trade | | | 0 | | | 0 | |
| Accrued Payroll | | | 0 | | | 0 | |
| Payroll Taxes Payable | | | 0 | | | 0 | |
| Accrued Expenses | | | 0 | | | 0 | |
| | | | | | | | |
| Total Current Liabilities | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Non Current Liabilities: | | | | | | | |
| Notes Payable-Related Parties | | | 719,995 | | | 719,995 | |
| | | | | | | | |
| Total Liabilities | | $ | 719,995 | | $ | 719,995 | |
| | | | | | | | |
Stockholders Equity | | | | | | | |
| Common Stock-$.06 Par Value | | | | | | | |
| 50,000,000 Shares Authorized, 5,353,857 Shares | | | | | | | |
| Issued and Outstanding | | $ | 321,232 | | $ | 321,232 | |
| Additional Paid in Capital | | | 322,097 | | | 322,097 | |
| Retained Earnings (Deficit) | | | (1,363,324 | ) | | (1,363,324 | ) |
| | | | | | | | |
| Total Stockholders Equity (Deficit) | | | (719,995 | ) | | (719,995 | ) |
| | | | | | | | |
| Total Liabilities & Stockholders Equity (Deficit) | | $ | 0 | | $ | 0 | |
| See Notes to Consolidated Financial Statements |
Universal Services Group, Inc. and Subsidiaries |
Consolidated Statements of Operations |
For the Three Months ended May 1, 2007 and 2006 |
(UNAUDITED) |
| | | For the Three Months | |
| | | Ended | |
| | | May 1, | | May 1, | |
| | | 2007 | | 2006 | |
| | | (Unaudited) | | (Unaudited) | |
| | | | | | |
| Revenues | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Direct Costs | | | 0 | | | 0 | |
| | | | | | | | |
| Gross Operating Profit | | $ | 0 | | $ | 0 | |
| | | | | | | | |
Expenses: | | | | | | | |
| Selling, General and Administrative Expenses | | | 0 | | | 0 | |
| Penalties & Interest | | | 0 | | | 0 | |
| Interest Expense, Net | | | 0 | | | 0 | |
Total Expenses | | | 0 | | | 0 | |
| | | | | | | | |
| Net Income (Loss) before Extraordinary Item | | | 0 | | | 0 | |
| | | | | | | | |
| Extraordinary Item: | | | | | | | |
| Forgiveness of Debt on Settlement of Liabilities | | | 0 | | | 0 | |
| | | | | | | | |
| Net Income (Loss) before Taxes | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Less:Provision for Income Taxes | | | 0 | | | 0 | |
| | | | | | | | |
Net Income (Loss) | | $ | 0 | | $ | 0 | |
| | | | | | | | |
Net Income (Loss) per Share | | | | | | | |
| Income (Loss) before Extraordinary Item | | | 0.00 | | | 0.00 | |
| Extraordinary Item | | | 0.00 | | | 0.00 | |
| | | | | | | | |
| Net Income (Loss) per Share | | $ | 0.00 | | $ | 0.00 | |
| See Notes to Consolidated Financial Statements |
Universal Services Group, Inc. and Subsidiaries |
Consolidated Statements of Operations |
For the Six Months ended May 1, 2007 and 2006 |
(UNAUDITED) |
| | | For the Six Months | |
| | | Ended | |
| | | May 1, | | May 1, | |
| | | 2007 | | 2006 | |
| | | (Unaudited) | | (Unaudited) | |
| | | | | | |
| Revenues | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Direct Costs | | | 0 | | | 0 | |
| | | | | | | | |
| Gross Operating Profit | | $ | 0 | | $ | 0 | |
| | | | | | | | |
Expenses: | | | | | | | |
| Selling, General and Administrative Expenses | | | 0 | | | 0 | |
| Penalties & Interest | | | 0 | | | 0 | |
| Interest Expense, Net | | | 0 | | | 0 | |
Total Expenses | | | 0 | | | 0 | |
| | | | | | | | |
| Net Income (Loss) before Extraordinary Item | | | 0 | | | 0 | |
| | | | | | | | |
| Extraordinary Item: | | | | | | | |
| Forgiveness of Debt on Settlement of Liabilities | | | 0 | | | 0 | |
| | | | | | | | |
| Net Income (Loss) before Taxes | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Less:Provision for Income Taxes | | | 0 | | | 0 | |
| | | | | | | | |
Net Income (Loss) | | $ | 0 | | $ | 0 | |
| | | | | | | | |
Net Income (Loss) per Share | | | | | | | |
| Income (Loss) before Extraordinary Item | | | 0.00 | | | 0.00 | |
| Extraordinary Item | | | 0.00 | | | 0.00 | |
| | | | | | | | |
| Net Income (Loss) per Share | | $ | 0.00 | | $ | 0.00 | |
| See Notes to Consolidated Financial Statements | |
Universal Services Group, Inc. and Subsidiaries |
Consolidated Statements of Cash Flows |
For the Six Months ended May 1, 2007 and 2006 |
(UNAUDITED) |
| | | For the Six Months | |
| | | Ended | |
| | | May 1, | | May 1, | |
| | | 2007 | | 2006 | |
| | | (Unaudited) | | (Unaudited) | |
Cash Flow from Operating Activities | | | | | |
| Income (Loss) from Operations | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Adjustments to Reconcile Net Income to | | | | | | | |
| Net income (Loss) to Net Cash Provided | | | | | | | |
| (Used) by Continuing Operations: | | | | | | | |
| Depreciation and Amortization | | | 0 | | | 0 | |
| | | | | | | | |
(Increase) Decrease in Assets | | | | | | | |
| Accounts Receivable | | | 0 | | | 0 | |
| Accounts Receivable-Sale of Business | | | | | | 0 | |
| Other Current Assets | | | 0 | | | 0 | |
| Other Assets | | | 0 | | | 0 | |
Increase (Decrease) in Liabilities | | | | | | | |
| Accounts Payable | | | 0 | | | 0 | |
| Accrued Expenses | | | 0 | | | 0 | |
| Payroll Taxes Payable | | | 0 | | | 0 | |
| Total Adjustments | | $ | 0 | | $ | 0 | |
| Net Cash Provided (Used) by Operating Activities | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Investing Activities | | | | | | | |
| Sale of Assets | | $ | 0 | | $ | 0 | |
| Return of Security Deposits | | | 0 | | | 0 | |
| Purchase of Assets | | | 0 | | | 0 | |
| Net Cash Provided (Used) by Investing Activities | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Financing Activities | | | | | | | |
| Additional Borrowings-Banks | | $ | 0 | | $ | 0 | |
| Payments to Banks | | | 0 | | | 0 | |
| Payments on Long Term Obligations | | | 0 | | | 0 | |
| Additional Borrowings-Related Parties | | | 0 | | | 0 | |
| Net Cash Provided (Used) by Financing Activities | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Net Increase (Decrease) in Cash & Equivalents | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Cash & Cash Equivalents-Beginning of Year | | | 0 | | | 0 | |
| Cash & Cash Equivalents-End of Year | | $ | 0 | | $ | 0 | |
| | | | | | | | |
| Supplemental Disclosures of Cash Flow Information | | | | | | | |
| Cash Paid during Year for: Interest | | $ | 0 | | $ | 0 | |
| Taxes | | | 0 | | | 0 | |
| See Notes to Consolidated Financial Statements | |
Universal Services Group, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
May 1, 2007
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Name Change - On May 11, 1990, the Company changed its name from ReproTech, Inc. to Universal Services Group, Inc.
Basis of Presentation - The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, General Industrial Technologies, Inc., Data Sciences, Inc. All significant intercompany transactions have been eliminated.
Revenue Recognition - The Company reports personnel service revenue when the service is provided.
Reclassified - Certain prior year’s items have been reclassified to conform to current year’s presentation.
Common Stock - Effective May 11, 1990 the Company declared a one-for-six reverse stock split. All references in the financial statements to weighted average numbers of shares and per share amounts have been restated to reflect the split.
2. In the opinion of management, the accompanying unaudited financial statements contain all adjustments necessary to present fairly the financial position, the results of operations and cash flows for the periods presented.
These statements should be read in conjunction with the summary of significant accounting policies and notes contained in the registrant’s annual report (form 10K) for the year ended November 1, 2006.
3. Going Concern - On May 1, 2007 the Company had no assets, no current liabilities, no working capital and a deficit in stockholders equity of $719,995. These factors contribute to an inability to continue as a going concern.
All business assets have been sold. There is insufficient capital to retire the remaining liabilities and provide working capital for some future business venture. Accordingly, any new business venture will require the Company to raise additional capital to meet all anticipated financial requirements.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Introduction
Universal Services Group, Inc. (formerly known as Reprotech, Inc.) was incorporated on February 27, 1984 under the laws of the State of Delaware (the “Company”). The Company, through its wholly-owned subsidiaries, General Industrial Technologies, Inc. and Data Sciences Incorporated (collectively, the “Subsidiaries”), was engaged in the business of providing temporary and permanent technical personnel such as engineers, designers, data processing, computer-aided design drafting specialists and architects.
On August 30, 1993, the Company entered into a sales agreement in which it sold substantially all or all of its fixed, prepaid and intangible assets (including assets owned by the Subsidiaries) to Lehigh-GIT, Inc., an affiliate of Nesco Services Company (the “Transaction”) for $600,000 and an amount of up to $1,000,000 more, contingent upon the purchaser’s future profits. Of the $600,000 purchase price, $75,000 was paid to the Company and $525,000 was escrowed for tax liens and claims of government agencies against the Subsidiaries for payroll tax arrearages. Subsequently, after the closing of the Transaction, the Company wound down its operations and ceased any and all business activities with the expectation to apply the contingent sales proceeds, if any, to satisfy a portion of the remaining liabilities of the Company.
Results of Operations
The Company generated no revenue and incurred no selling, general and administrative expenses for the three month period ended May 1, 2007 and has not conducted any business operations since 1993.
As of the date of the filing of this quarterly report, the Company is seeking a new business venture.
Liquidity and Capital Resources
As the Company no longer has operations on a going forward basis, the Company will no longer have revenues, but may have expenses while it seeks a new business venture. The Company has an administrative headcount of one.
The Company may rely on short-term advances from related parties to finance any cash requirements while seeking a new business venture.
Item 3. Controls and Procedures.
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports under the Securities Exchange Act of 1934, as amended. The Company carried out an evaluation, under the supervision, and with the participation, of the Company’s Chief Executive Officer and Acting Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures as of the quarterly period ended covered by this report. Based on the foregoing, the Company’s Chief Executive Officer and Acting Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of such date. There have been no significant changes during such period in the Company’s internal control over financial reporting or in other factors that could significantly affect the internal control over financial reporting.
Part II OTHER INFORMATION
Item 1. Legal Proceedings.
Pursuant to a written notice dated October 25, 2006, the SEC notified the Company of its non-compliance with its reporting requirements under the Act. In its notice, the SEC informed the Company that if the Company does not file all required reports, the SEC may revoke the Company's registration under the Act. The Company intends to become compliant with all SEC reporting requirements by filing all past due periodic reports.
Except for the aforementioned SEC matter, the Company is not a party to any litigation or governmental proceedings that management believes would result in judgments or fines that would have a material adverse effect on the Company.
Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to Vote of Securities Holders.
No matters were submitted to a vote of the holders of the Company's common stock during the quarterly period covered by this report.
Item 5. Other Information.
Not Applicable.
Item 6. Exhibits.
(a) Exhibits
None.
(b) Reports on Form 8-K
None.
31.1 Certification of Chief Executive Officer and Acting Chief Financial Officer
32.1 Section 906 Certification
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | |
| | UNIVERSAL SERVICES GROUP, INC. |
|
|
|
| By: | /s/ Colin Halpern |
| |
Colin Halpern, Chairman and Chief Executive Officer |
| | |
| | Date: August 15, 2007 |
