United States
Securities and Exchange Commission
Washington, DC 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Quarter Ended Commission File Number
June 30, 2002 333-51180
OFFICE MANAGERS, INC.
---------------------
(Exact name of registrant as specified in its charter)
NEVADA
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(State or other jurisdiction of incorporation or organization
87-0661638
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(I.R.S. Employer Identification No.)
136 East South Temple, Suite 1600, Salt Lake City, Utah 84111
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(Address of principal executive offices)
(801) 363-2656
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(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12 (b) of the Act: None
----
Indicate by check mark whether the registrant (1) 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 (2) has been subject to
such filing requirements for the past 90 days.
X Yes No
----- -----
State the number of shares outstanding of each of the registrants classes
of common equity, as of the latest practicable date.
Common stock, par value $.001; 29,500,000 shares outstanding
as of May 14, 2002
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
The accompanying balance sheets of Office Managers, Inc. ( development
stage company) at June 30, 2002 and December 31, 2001, and the related
statement of operations and cash flows for the three months and six months
ended June 30, 2002, and 2001 and the period September 19, 2000 to June 30,
2002 have been prepared by the Company's management in conformity with
generally accepted accounting principles in the United States of America.
In the opinion of management, all adjustments considered necessary for a
fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring nature.
Operating results for the six months ended June 30, 2002 are not
necessarily indicative of the results that can be expected for the year
ending December 31, 2002.
[This space intentionally left blank.]
OFFICE MANAGERS, INC.
( Development Stage Company)
BALANCE SHEETS
June 30, 2002 and December 31, 2001
<Table>
<Caption>
===========================================================================
Jun 30, Dec 31,
2002 2001
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ASSETS
CURRENT ASSETS
Cash $ 330,208 $ 35,161
----------- -----------
Total Current Assets 330,208 35,161
----------- -----------
Equipment - net of accumulated depreciation 10,611 -
----------- -----------
$ 340,819 $ 35,161
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ - $ -
----------- -----------
Total Current Liabilities - -
----------- -----------
STOCKHOLDERS' EQUITY
Common stock
50,000,000 shares authorized, at $0.001
par value; 29,500,000 shares issued and
outstanding on June 30, 2002 29,500 29,500
Capital in excess of par value 64,310 64,310
Stock subscriptions received - note 5 403,250 -
Deficit accumulated during the development stage (156,241) (58,649)
----------- -----------
Total Stockholders' Equity 340,819 35,161
----------- -----------
$ 340,819 $ 35,161
=========== ===========
</Table>
The accompanying notes are an integral part of these financial statements.
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OFFICE MANAGERS, INC.
(Development Stage Company)
STATEMENT OF OPERATIONS
For the Three and Six Months Ended June 30, 2002 and 2001 and the
Period September 19, 2000 (Date of Inception) to June 30, 2002
<Table>
<Caption>
=====================================================================================
Three Months Six Months Sept 19,
--------------------- --------------------- 2000 to
Jun 30, Jun 30, Jun 30, Jun 30, Jun 30,
2002 2001 2002 2001 2002
---------- ---------- ---------- ---------- ----------
REVENUES $ - $ - $ - $ - $ -
---------- ---------- ---------- ---------- ----------
EXPENSES
Administrative 83,631 5,405 93,565 7,580 123,187
Development of web site -
preliminary project stage 4,027 - 4,027 - 33,054
---------- ---------- ---------- ---------- ----------
86,214 5,405 97,592 7,580 156,241
---------- ---------- ---------- ---------- ----------
NET LOSS $ 86,214 $ 5,405 $ (97,592) $ (7,580) $(156,241)
========== ========== ========== ========== ==========
NET LOSS PER COMMON SHARE
Basic $ - $ - $ - $ -
---------- ---------- ---------- ----------
AVERAGE OUTSTANDING SHARES
Basic (stated in 1000's) 29,500 29,500 29,500 29,500
---------- ---------- ---------- ----------
</Table>
The accompanying notes are an integral part of these financial statements
4
OFFICE MANAGERS, INC.
( Development Stage Company)
STATEMENT OF CASH FLOWS
For the Six Months Ended June 30, 2002 and 2001 and the
Period September 19, 2000 (Date of Inception) to June 30, 2002
<Table>
<Caption>
=====================================================================================
Jun 30, Jun 30, Jun 30,
2002 2001 2002
----------- ----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (97,592) $ (7,580) $ (156,241)
Adjustments to reconcile net loss to
net cash provided by operating
activities
Depreciation 559 - 559
Change in accounts payable - 500 -
Issuance of capital stock for web site - - 25,000
----------- ----------- -----------
Net Decrease in Cash From Operations (97,033) (7,080) (130,682)
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment (11,170) - (11,170)
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Stock subscriptions received -
net of refunds - note 5 403,250 - 403,250
Proceeds from issuance of common stock - 2,500 68,810
----------- ----------- -----------
Net Increase (Decrease) in Cash 95,047 (4,580) 330,208
----------- ----------- -----------
Cash at Beginning of Period 35,161 43,800 -
----------- ----------- -----------
Cash at End of Period $ 330,208 $ 39,220 $ 330,208
=========== =========== ===========
NON CASH FLOWS FROM OPERATING ACTIVITIES
Issuance of 6,000,000 common shares for
web site - 2000 $ 25,000
-----------
</Table>
The accompanying notes are an integral part of these financial statements.
5
OFFICE MANAGERS, INC.
( Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
===========================================================================
1. ORGANIZATION
The Company was incorporated under the laws of the State of Nevada on
September 19, 2000 with authorized common stock of 50,000,000 shares at
$0.001 par value.
The Company was organized for the purpose of acquiring and developing a
web site on the World Wide Web devoted exclusively to office managers for
the purpose of delivering office products and related professional services
over the internet.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
- ------------------
The Company recognizes income and expenses based on the accrual method of
accounting.
Dividend Policy
- ---------------
The Company has not adopted a policy regarding payment of dividends.
Income Taxes
- ------------
On June 30, 2002, the Company had a net operating loss carry forward of
$156,241. The tax benefit of approximately $46,872 from the loss carry
forward has been fully offset by a valuation reserve because the use of
the future tax benefit is doubtful since the Company has no operations.
The net operating loss will expire in 2023.
Basic Net Income (Loss) Per Share
- ----------------------------------
Basic net income (loss) per share amounts are computed based on the
weighted average number of shares actually outstanding.
Amortization of Web Site
- ------------------------
Costs of the preliminary development of the web site are expensed as
incurred and costs of the application and post- implementation are
capitalized and amortized over the useful life of the fully developed web
site.
Financial Instruments
- ---------------------
The carrying amounts of financial instruments, including cash, are
considered by management to be their estimated fair values.
6
OFFICE MANAGERS, INC.
( Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (Continued)
===========================================================================
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
Concentration of Credit Risk
- ----------------------------
Financial instruments that potentially subject the Company to significant
concentration of credit risk consists of cash. Cash balances are
maintained in accounts that are not federally insured for amounts over
$100,000 but are other wise in financial institutions of high credit
quality.
Estimates and Assumptions
- -------------------------
Management uses estimates and assumptions in preparing financial statements
in accordance with generally accepted accounting principles. Those
estimates and assumptions affect the reported amounts of the assets
and liabilities, the disclosure of contingent assets and liabilities, and
the reported revenues and expenses. Actual results could vary from the
estimates that were assumed in preparing these financial statements.
Recent Accounting Pronouncements
- --------------------------------
The Company does not expect that the adoption of other recent accounting
pronouncements will have a material impact on its financial statements.
3. ACQUISITION OF WEB SITE
On September 25, 2000 the Company acquired the web site and the domain name
"officemanagers.net", (which was in the preliminary development stage) from
Ambra Resources, Inc.(an affiliate), by the issuance of 6,000,000 common
shares of the Company, for the purpose of pursuing its business interest
as outlined in note 1. The value of the web site was recorded at $25,000,
the acquisition cost to Ambra Resources, Inc., before the sale to the
Company.
Costs of the preliminary development of the web site are expensed as
incurred and costs of the application and post- implementation will be
capitalized and amortized over the useful life of the fully developed web
site.
4. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES
Officers-directors and Ambra Resources, Inc. have acquired 51 % of the
common stock issued. Ambra Resources, Inc. (an affiliate) received
6,000,000 common shares of the Company in exchange for the web site
outlined in note 3.
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OFFICE MANAGERS, INC.
( Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (Continued)
===========================================================================
5. CAPITAL STOCK
Since its inception the Company has completed private placement offerings
of 23,500,000 common shares for $68,810.
The Company completed the filing of an offering for the sale of 2,000,000
to 6,000,000 units a $.10 per unit. Each unit consists of one share of
common stock, one redeemable A warrant to purchase an additional common
share at $.50 within one year, and one redeemable B warrant to purchase
an additional common share at $1.20 within five years.
On June 30, 2002, 4,032,500 units had been sold for $403,250 and placed in
escrow pending the closing of the offering.
6. CONTINUING LIABILITIES
On May 22, 2001 the Company entered into a service agreement with Media-
Comm Marketing International , Inc. to further develop the web site
acquired by the Company. The agreement will become effective on the
completion of the offering outlined in note 5.
The accompanying balance sheets of Office Managers, Inc. ( development
stage company) at June 30, 2002 and December 31, 2001, and the related
statement of operations and cash flows for the three and six months ended
June 30, 2002, and 2001 and the period September 19, 2000 to June 30, 2002
have been prepared by the Company's management in conformity with
accounting principles generally accepted in the United States of America.
In the opinion of management, all adjustments considered necessary for a
fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring nature.
Operating results for the three months ended June 30, 2002 are not
necessarily indicative of the results that can be expected for the year
ending December 31, 2002.
ITEM 2. Plan of Operations
This Form 10-QSB contains certain forward-looking statements. For
this purpose any statements contained in this Form 10-QSB that are not
statements of historical fact may be deemed to be forward-looking
statements. Without limiting the foregoing, words such as "may," "will,"
"expect," "believe," "anticipate," "estimate" or "continue" or comparable
terminology are intended to identify forward-looking statements. These
statements by their nature involve substantial risks and uncertainties.
Actual results may differ materially depending on a variety of factors.
8
General
- -------
Office Managers, Inc., (the "Company") is a start-up company and has
no operating history. On July 10, 2002, the Company completed a public
offering. The Company publicly offered a minimum of 2,000,000 units and a
maximum of 6,000,000 units for sale at a price of $.10 per unit. Each unit
consisted of one share of common stock, one redeemable A warrant to
purchase an additional common share within one year for $.50 per share and
one redeemable B warrant to purchase an additional common share within five
years for $1.20 per share. The SB-2 registration statement under which the
Company made this public offering was declared effective by the Securities
and Exchange Commission on January 11, 2002. The Company received
subscriptions to purchase 5,240,500 units and total funds received was
$524,050. The Company has broken escrow and the units are currently being
issued. The Company has begun to make arrangements to commence operations.
Office Managers, Inc., intends to create a comprehensive website
devoted to addressing the credit and collections needs of small business
and home office owners. The Company's approach will combine traditional
professional service referrals, customer service and office products with
the cost effective online medium. The Company's system will include:
. A national network of reliable, qualified professional service
providers in the areas of credit, collections and financing.
. A personalized professional customer service department to
interact with, provide referrals to, and address the credit and
collections needs of small business and home office owners.
. Automated online sales of business products in over ten different
categories including, office supplies, computer hardware and
software and furniture.
. Access to secure current national, international and industry
news.
. Online advertising.
The primary value driver of the Company's business model will be the
referral fees it collects from referrals to collections professionals. The
Company does not anticipate product sales to be a significant source of
income given that it will rely primarily on third parties to provide and
distribute these products. Moreover, the Company will not significantly
mark up product prices as it intends to sell the products at competitive
prices. Assuming the Company can generate sufficient traffic to its
website, the Company may also realize revenue from sales of advertising.
The Company does not anticipate advertising sales to generate significant
revenue because it does not intend to vigorously pursue advertising sales.
As the Company has not yet developed its referral network, there is
no assurance that there will be sufficient demand for its referral service
to allow the Company to operate profitably. Moreover, there is substantial
uncertainty whether the Company can convince a sufficient number of
professional collections agencies that the referrals it will provide will
be worth the referral fee they will pay to the Company. If the Company is
unsuccessful in creating demand or enrolling sufficient collections
professionals into its referral network, it is unlikely the Company can
operate profitably.
The Company's plan of operations for the next twelve months is use the
funds raised through the SB-2 offering to provide capital to help defray
start up expenditures. The offering proceeds will be used primarily to
provide working capital until sufficient revenues are generated to cover
such operating expenditures or until funds from the offering run out. The
Company is in the process of undertaking a number of planning stage and
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preliminary activities. These activities include purchasing and putting in
place the necessary electronic infrastructure to support the Company's
website; developing software to run both the website and the referral
databases; finishing construction of the website; negotiating agreements
with product suppliers; putting in place the necessary infrastructure to
support the Company's e-commerce operations, including order placement,
secure payment, and delivery systems; negotiating agreements for content
production and delivery; developing a sufficient referral network to begin
operations, including negotiating agreements with service providers on the
terms discussed herein; hiring and training sales and marketing and
customer service representatives; and formulating and implementing an
aggressive marketing campaign to drive the office management community to
the Company's website. The Company expects to have its website, including
the software to run it and its referral databases and e-commerce
infrastructure, operational during the fourth quarter of 2002, at a cost of
approximately $85,000 to $100,000.
The Company currently has no employees other than its officers. The
Company anticipates the need to hire up to 15 employees within the next
twelve months. As needed, the Company expects to hire five
accounting/billing coordinators, three sales representatives, five customer
service representatives, an office manager, a secretary/ receptionist, and
an information technology specialist.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
No instruments defining the rights of the holders of any class of
registered securities have been materially modified, limited or qualified
during the quarter ended June 30, 2002.
The Company issued no securities, which were not registered under the
Securities Act of 1933, during the quarter ended June 30, 2002.
Item 2. Changes in Securities
No instruments defining the rights of the holders of any class of
registered securities have been materially modified, limited or qualified
during the quarter ended June 30, 2002.
The Company issued no securities, which were not registered under the
Securities Act of 1933, during the quarter ended June 30, 2002.
On January 11, 2002, the Company's public offering pursuant to
registration of units on Securities and Exchange Commission ("SEC") Form
was declared effective by the SEC. The offering was conducted by the
officers of the Company. The Company received subscriptions for 5,240,500
units and total proceeds of $524,050. The offering closed upon the
expiration of the offering period on July 10, 2002. As the offering was
not underwritten, the Company paid no underwriting expenses. No
distribution expenses were paid during the quarter ended June 30, 2002, and
no distribution expenses were or will be paid to any officer, director or
affiliate of the Company.
10
During June 2002, the Company purchased two certificates of deposit
("CD") from U.S. Bank, one in the amount of $100,000 the other in the
amount of $50,000. The $100,000 CD is a six-month CD and has a rate of
return of 1.69%. The $50,000 CD is a three-month CD and has a rate of
return of 1.49%. As of June 30, 2002, the Company had used approximately
$83,000 of the proceeds of the offering to cover working capital costs.
The Company has spent approximately $4,000 on the development of its
website. The Company also spent approximately $11,000 to purchase
equipment. Approximately $16,000 of proceeds of the offering have been
paid to officer and directors of the Company as compensation incidental to
their employment with the Company.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the
quarter ended June 30, 2002.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
Reports on Form 8-K
No reports on Form 8-K were filed or required to be filed during the
quarter ended June 30, 2002.
(B) Exhibits. The following exhibits are included as part of this
report:
None.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this to be signed on its behalf by the
undersigned thereunto duly authorized.
Office Managers, Inc.
August 14, 2002 /s/ John M. Hickey
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John M. Hickey, President
August 14, 2002 /s/ John Ray Rask
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John Ray Rask, Secretary
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