SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
July 9th, 2001
----------------
Date of Report
(Date of Earliest Event Reported)
UNITED FILM PARTNERS, INC.
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(Exact Name of Registrant as Specified in its Charter)
Texas 00-32681 76-0676164
- --------------- ----------- ------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
1224 N. Lincoln St., Burbank, CA 91506
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(Address of principal executive offices)
949-271-9198
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Registrant's telephone number
ILN BETHANY CORPORATION
15007 Grove Gardens, Houston, TX 77082
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(Former name and address of Registrant)
ITEM 7. FINANCIAL STATEMENTS
United Film Partners, Inc
f/k/a ILN Bethany Corporation
(A Development Stage Company)
FINANCIAL STATEMENTS
December 31, 2001
CONTENTS
Page
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INDEPENDENT AUDITOR'S REPORT F-2
FINANCIAL STATEMENTS
Balance Sheet F-3
Statement of Loss and Accumulated Deficit During F-4
the Development Stage
Statement of Cash Flows F-5
Statement of Stockholders' Equity F-6
NOTES TO FINANCIAL STATEMENTS F-7 to F-9
F-1
Independent Auditor's Report
Stockholders and Board of Directors
United Film Partners, Inc. (A Development Stage Company)
f/k/a ILN Bethany Corporation
Burbank, California
We have audited the accompanying balance sheet of United Film Partners,
Inc. (A Development Stage Company) f/k/a ILN Bethany Corporation, as of
December 31, 2001, and the related statements of loss and accumulated
deficit during the development stage, cash flows, and stockholders'
equity for the period from inception (April 2, 2001) to December 31, 2001.
These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that
we 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. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of United
Film Partners, Inc. (A Development Stage Company) f/k/a ILN Bethany
Corporation at December 31, 2001, and the results of its operations
and its cash flows for the period from inception (April 2, 2001) to
December 31, 2001, in conformity with accounting principles generally
accepted in the United States of America.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in
Note 5 to the financial statements, the Company incurred a loss
of $7,715 from inception (April 2, 2001) to December 31, 2001, which
raises substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are also
described in Note 5. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ Dohan and Company, CPA's
April 14, 2002
Miami, Florida
F-2
UNITED FILM PARTNERS, INC f/k/a ILN BETHANY CORPORATION
(A Development Stage Company)
BALANCE SHEET
December 31, 2001
ASSETS
Film inventories $ 890,000
Deferred tax asset, less valuation allowance of $1,157 -
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TOTAL ASSETS $ 890,000
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LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES
Accounts payable $ 541
Accrued professional fees 2,000
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TOTAL LIABILITIES 2,541
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STOCKHOLDERS' EQUITY
Preferred Stock, $.0001 par value, 20,000,000 shares
authorized; none outstanding -
Common Stock, $.0001 par value, 100,000,000 shares
authorized; 36,312,500 shares issued and outstanding 3,631
Additional paid-in capital 891,543
Deficit accumulated during the development stage (7,715)
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TOTAL STOCKHOLDERS' EQUITY 887,459
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 890,000
==========
See accompanying notes.
F-3
UNITED FILM PARTNERS, INC f/k/a ILN BETHANY CORPORATION
(A Development Stage Company)
STATEMENT OF LOSS AND ACCUMULATED DEFICIT DURING THE DEVELOPMENT STAGE
For the period from inception (April 2, 2001) to December 31, 2001
EXPENSES
Organizational expenses $ 985
Consulting and professional fees 5,077
Other operating expenses 1,653
---------
NET LOSS BEFORE INCOME TAX (7,715)
INCOME TAXES -
---------
NET LOSS AND ACCUMULATED DEFICIT DURING THE
DEVELOPMENT STAGE (7,715)
=========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
(BASIC AND DILUTED) 22,991,788
=========
NET LOSS PER SHARE (BASIC AND DILUTED) $ (0.0003)
=========
See accompanying notes.
F-4
UNITED FILM PARTNERS, INC f/k/a ILN BETHANY CORPORATION
(A Development Stage Company)
STATEMENT OF CASH FLOWS
For the period from inception (April 2, 2001) to December 31, 2001
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(7,715)
Adjustments to reconcile net loss to net cash used by
operating activities:
Common stock issued to charitable organization 10
Common Stock issued under employee stock incentive plan
as compensation 121
Increase in liabilities
Accounts payable 541
Accrued professional fees 2,000
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NET CASH USED BY OPERATING ACTIVITES (5,043)
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CASH FLOWS FROM FINANCING ACTIVITIES
Common stock issued for cash 1,000
Contributed Capital 4,043
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NET CASH PROVIDED BY FINANCING ACTIVITIES 5,043
---------
NET INCREASE IN CASH AND EQUIVALENTS FOR THE PERIOD
AND CUMULATIVE DURING THE DEVELOPMENT STAGE -
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD -
---------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ -
=========
SUPPLEMENTAL DISCLOSURES
Interest paid $ -
Income taxes paid $ -
SUPPLEMENTAL DISCLOSURES OF NON-CASH TRANSACTIONS:
Common stock issued per plan of reorganization for
film inventories $ 890,000
=========
See accompanying notes.
F-5
UNITED FILM PARTNERS, INC f/k/a ILN BETHANY CORPORATION
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
December 31, 2001
Accumulated
Deficit
Common Stock Additional During the Total
----------------------- Paid-In Development Stockholder's
Description Shares Amount Capital Stage Equity
- -----------------------------------------------------------------------------------------
Common stock issued
for cash 5,000,000 $ 500 $ 500 $ - 1,000
Contributed capital - - 4,043 - 4,043
Common stock issued
for film inventories 30,000,000 3,000 887,000 - 890,000
Common stock issued
pursuant to stock
incentive plan 1,212,500 121 - - 121
Common stock issued 100,000 10 - - 10
to charitable
organization
Net loss and cumulative
loss during the
development stage - - - (7,715) (7,715)
- -------------------------------------------------------------------------------------------
36,312,500 $3,631 $ 891,543 $ (7,715) $ 887,459
===========================================================================================
See accompanying notes.
F-6
NOTE 1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Activity
United Film Partners, Inc (A Development Stage Company) (the
Company) was incorporated in Texas on April 2, 2001 under the name
ILN Bethany Corporation (Bethany) to serve as a vehicle to effect
a merger, exchange of capital stock, asset acquisition or other
business combination with a domestic or foreign private business.
The Company entered into a business combination and acquired all of
the assets and liabilities of United Film Partners, Inc, a Delaware
Corporation (UFP Delaware) on July 9, 2001, pursuant to an agreement
and Plan of Reorganization. The agreement set forth that Bethany
would issue 30,000,000 shares to the shareholders of UPF Delaware.
The Company's name was changed to United Film Partners, Inc and will
now engage in the motion picture business.
At December 31, 2001, the company had not yet commenced any formal
business operations. The company's fiscal year-end is December 31.
The Company's ability to commence operations is contingent upon
its ability to raise the capital it will require through the
issuance of equity securities, debt securities, bank borrowings or
a combination thereof.
Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosures of contingent assets and liabilities
at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. Actual results
could differ from those estimates.
Income Taxes
The Company follows Statement of Financial Accounting Standards No.
109 (FAS 109), "Accounting for Income Taxes". FAS 109 is an asset
and liability approach that requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of
the difference in events that have been recognized in the Company's
financial statements compared to the tax returns.
Advertising
Advertising costs will be expensed as incurred.
Net Loss Per Common Share
Basic net loss per common share is computed by dividing net loss
applicable to common shareholders by the weighted-average number of
common shares outstanding during the period. Diluted net loss per
common share is determined using the weighted-average number of
common shares outstanding during the period, adjusted for the
dilutive effect of common stock equivalents, consisting of shares
that might be issued upon exercise of common stock options. In
periods where losses are reported, the weighted-average number of
common shares outstanding excludes common stock equivalents, because
their inclusion would be anti-dilutive.
Cash and Cash Equivalents
The Company considers all highly liquid investments with original
maturities of three months or less to be cash equivalents.
F-7
Film inventories
Costs incurred in connection with the acquisition of story rights,
development of stories, treatment of screenplays, etc, are capitalized
as film inventories. The costs of each property screenplay is
capitalized and is amortized in the proportion that revenue realized
relates to management's estimate of the total revenue expected to be
realized from such screenplays. Film inventories are stated at the
lower of unamortized cost or estimated net realizable value. Selling
costs and other distribution costs are charged to expense as incurred.
During the year ended December 31, 2001 there were no revenue, selling
or distribution costs.
Development Stage Company
The Company has been devoting its efforts to activities such as
raising capital, establishing sources of information, and
developing markets for its planned operations. The Company has
not yet generated any revenues and, as such, it is considered a
development stage company.
Recent Pronouncements
In July 2001, the Financial Accounting Standards Board issued Financial
Accounting Standards No. 141 (SFAS 141), "Business Combinations" and
Financial Accounting Standards No. 142 (SFAS 142), "Goodwill and
Other Intangible Assets." SFAS 141 requires that all business
combinations be accounted for using the purchase method only and
that certain acquired intangible assets in a business combination
be recognized as assets apart from goodwill.
SFAS 142 requires that ratable amortization of goodwill be replaced
with periodic test of the goodwill impairment and that intangible
assets other than goodwill and other indefinite lived intangible
assets, be amortized over their useful lives. SFAS 141 is effective
for all business combinations initiated after June 30, 2001 and for
all business combinations accounted for by the purchase method for
which the date of acquisition is after June 30, 2001. The provisions
of SFAS 142 will be effective for fiscal years beginning after
December 15, 2001. The impact of SFAS 141 was applied to the business
combination of July 9, 2001 and has been accounted for as a purchase.
The impact of SFAS 142 on the financial statements has not yet been
determined.
Fair Value of Financial Instruments
Accounts payable and accrued professional fees are carried at amounts
which reasonably approximate their fair value due to the short-term
nature of these amounts or due to variable rates of interest which
are consistent with current market rates.
NOTE 2. RELATED PARTY TRANSACTIONS
In July 2001, 30,000,000 shares were issued to the stockholders
of UFP Delaware pursuant to Plan of Reorganization in exchange
for the assets of UFP Delaware, valued at $890,000.
NOTE 3. BUSINESS COMBINATION
On July, 2001, the Company completed a business combination
pursuant to a Plan of Reorganization with UFP Delaware
by exchanging 30,000,000 shares of its common stock for all of the
assets of UFP Delaware valued at $890,000. The combination
has been accounted for as a purchase.
NOTE 4. INCOME TAXES
At December 31, 2001, the Company had a net operating loss of
approximately $7,700. This loss may be used to offset federal income
taxes in future periods. However, if subsequently there are
ownership changes in the Company, as defined in Section 382 of the
Internal Revenue Code, the Company's ability to utilize net
operating losses available before the ownership change may be
restricted to a percentage of the market value of the Company at
the time of the ownership change. Therefore, substantial net
operating loss carry forwards could, in all likelihood, be limited
or eliminated in future years due to a change in ownership as
defined in the Code. The utilization of the remaining carry forwards
is dependent on the Company's ability to generate sufficient taxable
income during the carry forward periods and no further significant
changes in ownership.
The Company computes deferred income taxes under the provisions of
FASB Statement No. 109 (SFAS 109), which requires the use of an asset
and liability method of accounting for income taxes. SFAS No. 109
provides for the recognition and measurement of deferred income tax
benefits based on the likelihood of their realization in future years.
A valuation allowance must be established to reduce deferred income
tax benefits if it is more likely than not that, a portion of the
deferred income tax benefits will not be realized. It is Management's
opinion that the entire deferred tax benefit of $1,157 resulting
from the net operating loss may not be recognized in future periods.
Therefore, a valuation allowance equal to the deferred tax benefit of
$1,157 has been established, resulting in no deferred tax benefits
as of the balance sheet date.
NOTE 5. GOING CONCERN AND MANAGEMENT'S PLANS
As shown in the accompanying financial statements, the Company incurred
a net loss of $7,715 for the period from inception (April 2, 2001) to
December 31, 2001. The ability of the Company to continue as a going
concern is dependent upon its ability to obtain financing and achieve
profitable operations. The Company anticipates meeting its cash
requirements through the financial support of its shareholders and
raising of capital. The financial statements do not include any
adjustments that might be necessary should the Company be unable to
continue as a going concern.
F-8
NOTE 6. STOCKHOLDERS' EQUITY
Common stock issued
In July 2001, the Company issued 5,000,000 shares of common
stock for a total of $1,000. A stock subscription receivable was
recorded in connection with this transaction. In July 2001, a
shareholder of the Company provided consulting services, which
were estimated at $1,000 and paid-off the stock subscription
receivable.
Shares Issued pursuant to Plan of Reorganization
The Company entered into a business combination with UPF Delaware
pursuant to an agreement and Plan of Reorganization. Pursuant to
this agreement the Company issued 30,000,000 shares to the
shareholders of UFP Delaware for its total assets valued at
$890,000.
Contributed Capital
During the period from inception (April 2, 2001) to December 31, 2001,
a shareholder of the Company contributed $4,043 to pay for the Company's
various expenses.
Preferred Stock
The Board of Directors is authorized to establish the rights and
preferences of preferred stock. To date, the Board of Directors
has not established those rights and preferences.
NOTE 7. STOCK INCENTIVE PLAN
During the period ended December 31, 2001, the Company adopted a
Stock Incentive Plan and issued 1,212,500 pursuant to this Plan.
The Plan is aimed at attracting and retaining key employees,
non-employee directors and consultants to achieve long-term
corporate objectives. These shares were recorded at a par
value of $0.0001 and incentive compensation of $121 is
included in consulting and professional fees.
In October 2001, The Company issued 100,000 shares to the Boys & Girls
Club of Anaheim as a charitable contribution.
F-9
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this Current Report on Form
8-K/A to be signed on its behalf by the undersigned hereunto duly
authorized.
United Film Partners, Inc.
April 29, 2002 By /s/ Kevin Reem
--------------------------------
Kevin Reem, President