UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2009
[ ] Transition Report Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
For the transition period from to
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Commission File Number 333-139129
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BORDER MANAGEMENT, INC.
(Exact name of small business issuer as specified
in its charter)
Nevada 20-5088293
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
968 - 240 th Street V2Z 2Y3
Langley, British Columbia, Canada
(Address of principal (Zip Code)
executive offices)
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Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Title of each class
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Common stock, par value $0.001 per share
Preferred stock, par value $0.001 per share
Issuer's telephone number, including area code: (604) 539-9680
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 404 of the Securities Act. [ ]
Indicate by check mark if the issuer is not required to file reports pursuant
to Section 13 or 15(d) of the Exchange Act. [ ]
- ----------------------------------------------------------------
Check whether the issuer filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter period that the issuer was required to file such reports), and (2)
has been subject to the filing requirements for the past 90 days. Yes [X] No
Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-K and no disclosure will be contained, to the best of the
issuer's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a smaller reporting
company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a
smaller reporting
company)
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act). Yes [X] No
There were no issuer's revenues for the fiscal year ended December 31, 2009.
The aggregate market value of the Common Stock held by non-affiliates of the
issuer as of March 29, 2010 was $0.
The number of shares outstanding of the issuer's Common Stock as of March 29,
2010 was 14,050,000 shares.
DOCUMENTS INCORPORATED BY REFERENCE: NONE
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BORDER MANAGEMENT, INC.
2009 FORM 10-K ANNUAL REPORT
TABLE OF CONTENTS
PART I
Item 1 Description of Business . . . . . . . . . . . . . . . . . . . .1
Item 1a Risk Factors. . . . . . . . . . . . . . . . . . . . . . . . . .3
Item 2 Description of Property . . . . . . . . . . . . . . . . . . . .7
Item 3 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . .7
Item 4 Submission of Matters to a Vote of Security Holders . . . . . .7
PART II
Item 5 Market for Common Equity and Related Stockholder Matters. . . .7
Item 6 Management's Discussion and Analysis or Plan of Operation . . .9
Item 7 Financial Statements. . . . . . . . . . . . . . . . . . . . . .F-1
Item 8 Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . .14
Item 8A Controls and Procedures . . . . . . . . . . . . . . . . . . . .14
Item 8B Other Information . . . . . . . . . . . . . . . . . . . . . . .14
PART III
Item 9 Directors, Executive Officers, Promoters and Control Persons:
Compliance with Section 16(a) of the Exchange Act . . . . . . . . . . .14
Item 10 Executive Compensation. . . . . . . . . . . . . . . . . . . . .16
Item 11 Security Ownership of Certain Beneficial Owners and Management
and Related Stockholders. . . . . . . . . . . . . . . . . . . . . . . .16
Item 12 Certain Relationships and Related Transactions, and Director
Independence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Item 13 Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Item 14 Principal Accountant Fees and Services. . . . . . . . . . . . .18
PART I
Item 1. DESCRIPTION OF BUSINESS
History and Development
We were incorporated pursuant to the laws of the State of Nevada on June 7,
2006 under the name Border Management, Inc. Our Directors have significant
business experience. They have dealt personally with many entrepreneurs,
existing for profit and not-for profit businesses and organizations. They
have also dealt with all three Canadian levels of government. It became
apparent that the complexities of operating in Canada would be even more
daunting for non-Canadians who did not have the cultural, geographic, or
business background necessary. Border Management was formed to offer a "one
stop" management and consulting service to Non-Canadians. We have a mature
base of consultants that we can draw on to assist our Directors in providing
services to our clients. We are therefore able to provide advice directly or
through a sound base of business, engineering, legal, and other professionals
relating to a wide variety of issues including:
Business Structure
Strategic Planning
Budgeting
Financing
Accounting Systems
Tax Planning
Marketing
Capital Expenditures
Cost Controls
Project Management
Estate Planning
Mediation
Due Diligence
Mergers
Acquisitions
Web Site Design
Computer and Systems Installations
Border Management will work with both private and public companies. We will
market our services to accommodate a wide range of clients. We will serve
clients who require our services on a one-time basis. We believe however,
the majority of our revenues will be derived from assisting clients on an
ongoing basis over a period of years. We will strive to establish long term
business relationships.
Typical Revenue Producing Transaction
We will analyze each clients needs and our ability to professionally service
that client. Assuming we can, our fee will be set by the type of service we
provide. Services of a more routine or elementary nature will be charged at
lower rates than services requiring specialized skills. Also, in many cases
we will have to utilize the outside services of consultants. In doing so our
fee will in part be dictated by the type of consultant retained what they as
sub-contractors would charge as well the quantity of work and expertise
applied. In some cases our fee will only be for a review of the clients
needs. In all cases, we will attempt to avoid misunderstandings regarding
fees with our clients by discussing and reviewing our services and the
amounts to be charged to our clients before accepting the engagement.
.1.
Revenue Breakdown
We will bill our clients in two ways. We will record revenues depending on
which way we invoice. If we accept an appointment to act as management or
business consultants, and the appointment is for a service or services which
will take an extended time to deliver, we will bill and record revenue on a
monthly or periodic basis. If we accept appointments that will provide
services for a short duration of time, we will bill and record revenue when
the services are completed. We may receive equity securities in certain
entities as payments for services provided for these entities. Some of these
entities may be newly formed, have no operating history, and the market for
such securities is very limited. Since there is no assurance that these
securities are marketable, we will recognize a reduced amount of revenue upon
receipt. Actual amounts of revenue will be recorded at the time we sell any
of these securities. The amount of shares we will accept in lieu of a portion
of a client's cash payment is situation specific. Such amount will not be
contingent on the success or failure of our efforts.
Strategic Relationships
We plan to engage outside consultants to assist us in providing services to
our clients. We will strive to establish personal and long-term business
relationships with these consultants. As our management team expands and we
are able to offer a wide range of services, we hope to engage the same
consultants on an ongoing basis. We should be able to effect economies of
scale in terms of the fees charged to us as well as become more efficient in
the use of such consultants.
The Market
Canada provides an exceptional market for many businesses. New businesses or
organizations however are faced with major differences in government
regulations and local business conditions than they are familiar with in
their home countries. Every person, business, or organization will face the
many challenges and Canadian specific regulations when attempting to set up
in Canada. We believe our potential client base is very large. Within the
potential client base we believe small to medium sized businesses will most
likely find our services attractive. Very large companies will have more "in
house" expertise as well as better funding to search out more established
consultants with high profiles.
Competition
We face a highly competitive market place for all of our services. We do not
expect this to change in the future. Other business consultants, accounting
firms, marketing and business development companies, engineering, personnel,
and project management firms will be direct competitors. Our competitors
will be better funded, more experienced, and already established. They
therefore may be able to offer similar services at lower rates.
Employees and Strategic Advisors
As at March 29, 2010 we have no full-time employees with the
exception of our three members of Executive Management and Board of
Directors. We will utilize outside consultants as required to offer our
services. These consultants will be independent contractors.
.2.
Financial Information About Industry Segments
The Company has commenced limited operations with respect to research and
marketing as at December 31, 2009. The Company has generated no service
revenue to date and therefore does not report financial information on
indusrty segments.
Compliance with Environmental Laws and Regulations
Our operations are subject to local, state and federal laws and regulations
governing environmental quality and pollution control. To date, our
compliance with these regulations has had no material effect on our
operations, capital, earnings, or competitive position, and the cost of such
compliance has not been material. We are unable to assess or predict at this
time what effect additional regulations or legislation could have on our
activities.
Item 1a RISK FACTORS
Risk Factors
In addition to other information contained in this Form 10-K, the following
Risk Factors should be considered when evaluating the forward-looking
statements contained in this Form 10-K:
An Investment In Our Common Stock Involves A High Degree Of Risk. Investors
could lose their entire investment. Prospective investors should carefully
consider the following factors, along with the other information set forth in
this 10-K, in evaluating Border Management, its business and prospects
before purchasing the common stock.
Concentrated Ownership Of Our Common Stock May Allow Certain Security Holders
To Exert Significant Influence In Corporate Matters Which May Be Adverse To
The Public Investor.
Our principal stockholders, officers and directors own a controlling interest
in our voting stock and investors will not have any effective voice in our
management, which could result in decisions adverse to our general
shareholders.
Our three officers and directors, in the aggregate, beneficially own
approximately or have the right to vote 54% of our outstanding common stock.
As a result, these three stockholders, acting together, will have the ability
to control substantially all matters submitted to our stockholders for
approval including:
- - election of our board of directors;
- - removal of any of our directors;
- - amendment of our Articles of Incorporation or bylaws;
- - adoption of measures that could delay or prevent a change in control
or impede a merger, takeover or other business combination involving
us; and
- - adoption of measures that could initiate a change in control, a
merger, takeover, or other business combination involving us.
As a result of their ownership and positions, our directors and executive
officers collectively are able to influence all matters requiring shareholder
approval, including the election of directors and approval of significant
corporate transactions. In addition, the future prospect of sales of
significant amounts of shares held by our directors and executive officers,
could affect the market price of our common stock if the marketplace does not
orderly adjust to the increase in shares in the market and the value of your
investment in the company may decrease. Management's stock ownership may
discourage a potential acquirer from making a tender offer or otherwise
attempting to obtain control of us, this in turn could reduce our stock
price or prevent our stockholders from realizing a premium over our stock
price.
The Timing And Amount Of Capital Requirements Are Not Entirely Within Our
Control And Cannot Accurately Be Predicted And As A Result, We May Not Be
Able To Raise Capital In Time To Satisfy Our Needs.
If we are unable to attract clients and the resulting revenues, we may need
to acquire additional financing. If working capital is required, we may
require financing sooner than anticipated. We have no commitments for
financing, and we cannot be sure that any financing would be available in a
timely manner, on terms acceptable to us, or at all. Further, any equity
financing could reduce ownership of existing stockholders and any borrowed
money could involve restrictions on future capital raising activities and
other financial and operational matters. If we were unable to obtain
financing as needed, we could be bankrupt.
.3.
We Are a Development Stage Company.
We were incorporated on June 7, 2006. Although we believe we will generate
revenues and become profitable, no assurance can be given in this regard. We
are a development stage company and may never be able to effectively
implement our business plan. The revenue and income potential of our
proposed business and operations is unproven. The lack of operating history
makes it difficult to evaluate the future prospects of our business.
Our Competitors Are Better Financed and Already Established in the Industry.
As our competitors are better established and funded, they will be able to
offer services at more competitive prices than us if they choose. We may
have to accept engagements at significantly lower fees to attract clients.
We may be unable to attract larger clients who want existing name recognition
from their consultants.
In addition we hold no trademarks or copyrights and our proprietary
information could be assumed by others offering similar services. Our
business model is not capital intensive, so others wanting to enter our field
will have little barrier to entry if they have the necessary skills.
We Have Limited Operating History And Have Losses To Date Which May Continue
in The Future. As A Result, We May Have To Suspend Or Cease Operations.
We have generated no operating revenues since our incorporation on June 7,
2006. We cannot with any accuracy evaluate our future success or failure. Our
ability to achieve and maintain profitability and positive cash flow is
dependent upon our ability to procure new business and generate revenues.
Our current operating expenses are greater than our revenues. As we cannot
be certain of future revenues, we may have to suspend our operations.
At Present We Are Dependant On Our Three Directors And A Loss Of Any Could
Have A Material Adverse Effect Upon Us.
Evan Williams, President, Solomon Nordine, Treasurer, and Leigh Anderson,
Secretary are our Founding Directors. None of our Directors has a consulting
or employment contract with us so there is no assurance that they will remain
with us. Our Directors are committed to provide a part time commitment only
as they serve on the Boards of other non-competitive privately held
companies. If any were to leave or be unable to perform there duties, there
is no assurance that we would be able to retain qualified personnel We do
not maintain any key man life insurance policies on any of our Directors so
in the event of death, there would be no extra funding to cope with any
resulting financial losses we might incur.
There is no current trading market for our securities and if a trading market
does not develop, purchasers of our securities may have difficulty selling
their shares.
As of November 14, 2007, our securities were listed on the OTC Bulletin
Board. There is currently no established public trading market for our
securities and an active trading market in our securities may not develop or,
if developed, may not be sustained. If for any reason a public trading market
does not otherwise develop, purchasers of the shares may have difficulty
selling their common stock should they desire to do so. No market makers have
committed to becoming market makers for our common stock and none may do so.
.4.
State securities laws may limit secondary trading, which may restrict the
states in which and conditions under which you can sell the shares of our
Company.
Secondary trading in our common stock will not be possible
in any state until the common stock is qualified for sale under the
applicable securities laws of the state or there is confirmation that an
exemption, such as listing in certain recognized securities manuals, is
available for secondary trading in the state. If we fail to register of
qualify, or to obtain or verify an exemption for the secondary trading of,
the common stock in any particular state, the common stock could not be
offered or sold to, or purchased by, a resident of that state. In the event
that a significant number of states refuse to permit secondary trading in our
common stock, the liquidity for the common stock could be significantly
impacted thus causing you to realize a loss on your investment.
We May Be Unable To Pay Any Cash Dividends On Our Common Stock, Our
Stockholders May Not Be Able To Receive A Return On Their Shares Unless They
Sell Them.
As we presently do not have net income nor can we assure our shareholders of
net income in the future, our stockholders may not be able to receive a
return on their shares unless they sell them. There is no assurance that
stockholders will be able to sell shares when desired.
Under Certain Conditions, We May Receive Securities As Full or Partial
Payment For Our Services Rendered And Such Securities May Lose All Value We
Ascribe To Them.
In certain circumstances, we may accept a client's securities as full or
partial payment. The securities we receive may be unregistered and as a
result restricted. As a general rule we must hold restricted securities for
one year until we have the ability to sell them. Although we will book any
restricted securities we receive at a significantly reduced valuation in
comparison to the same company's unrestricted shares, there is a risk that
during such holding period the securities may be become worthless. We would
suffer a loss of revenue as a result of such devaluation. By accepting
client's securities as payment we could become partially or fully dependent
of the client's success to sell the client's shares or receive dividends on
the client's shares that we hold. Securities we receive as payment may
decline in value from the time we receive them. Should we have to sell them
to acquire additional capital for operations, we could incur serious
financial losses that would impair our ability to carry on business.
We may not be able to raise sufficient capital or generate adequate revenue
to meet our obligations and fund our operating expenses.
Failure to raise adequate capital and generate adequate sales revenues to
meet our obligations and develop and sustain our operations could result in
our having to curtail or cease operations. Additionally, even if we do raise
sufficient capital and generate revenues to support our operating expenses,
there can be no assurances that the revenue will be sufficient to enable us
to develop business to a level where it will generate profits and cash flows
from operations. These matters raise substantial doubt about our ability to
operate as a going concern. Our independent auditors currently included an
explanatory paragraph in their report on our financial statements regarding
concerns about our ability to continue as a going concern.
.5.
We may, in the future, issue additional common shares, which would reduce
investors' percent of ownership and may dilute our share value.
Our Articles of Incorporation authorize the issuance of 50,000,000 shares of
common stock and 20,000,000 preferred shares. The future issuance of either
common or preferred stock may result in substantial dilution in the
percentage of our common stock held by our then existing shareholders. We may
value any stock issued in the future on an arbitrary basis. The issuance of
common or preferred stock for future services or acquisitions or other
corporate actions may have the effect of diluting the value of the shares
held by our investors, and might have an adverse effect on any trading market
for our common stock.
Our common shares are subject to the "Penny Stock" Rules of the SEC and the
trading market in our securities is limited, which makes transactions in our
stock cumbersome and may reduce the value of an investment in our stock.
The Securities and Exchange Commission has adopted Rule 15g-9 which
establishes the definition of a "penny stock," for the purposes relevant to
us, as any equity security that has a market price of less than $5.00 per
share or with an exercise price of less than $5.00 per share, subject to
certain exceptions. For any transaction involving a penny stock, unless
exempt, the rules require:
- - that a broker or dealer approve a person's account for transactions in
penny stocks; and
- - the broker or dealer receive from the investor a written agreement to
the transaction, setting forth the identity and quantity of the penny
stock to be purchased.
In order to approve a person's account for transactions in penny stocks, the
broker or dealer must:
- - obtain financial information and investment experience objectives of
the person; and
- - make a reasonable determination that the transactions in penny stocks
are suitable for that person and the person has sufficient knowledge
and experience in financial matters to be capable of evaluating the
risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prescribed by the Commission relating to the
penny stock market, which, in highlight form:
- - sets forth the basis on which the broker or dealer made the
suitability determination; and
- - that the broker or dealer received a signed, written agreement from
the investor prior to the transaction.
Generally, brokers may be less willing to execute transactions in securities
subject to the "penny stock" rules. This may make it more difficult for
investors to dispose of our Common shares and cause a decline in the market
value of our stock.
.6.
Disclosure also has to be made about the risks of investing in penny stocks
in both public offerings and in secondary trading and about the commissions
payable to both the broker-dealer and the registered representative, current
quotations for the securities and the rights and remedies available to an
investor in cases of fraud in penny stock transactions. Finally, monthly
statements have to be sent disclosing recent price information for the penny
stock held in the account and information on the limited market in penny
stocks.
Our Services May Sometimes Be Paid for With Restricted Securities
We may allow certain clients to pay for our services with a combination of
cash and restricted securities of theirs and as a result we are somewhat
dependent on such companies' ability to succeed in the marketplace. There
will usually be a significant period of time between when such securities are
received and when they may be sold into the market. In the event that any
securities we receive as partial payment decline in value from the time we
receive them and we find ourselves in the unfortunate position of needing to
raise capital for operations by selling some or all of such securities we may
suffer irreparable harm.
Our Forward-looking Statements Are Estimates Only
The statements contained in this 10-K that are not historical fact are
"forward-looking statements," which can be identified by the use of
forward-looking terminology such as "believes," "expects," "may," "should,"
or "anticipates," the negatives thereof or other variations thereon or
comparable terminology, and include statements as to the intent, belief or
current our expectations with respect to the future operations, performance
or position. These forward-looking statements are predictions. We cannot
assure you that the future results indicated, whether expressed or implied,
will be achieved. While sometimes presented with numerical specificity, these
forward-looking statements are based upon a variety of assumptions relating
to our business, which, although currently considered reasonable by us, may
not be realized. Because of the number and range of the assumptions
underlying our forward-looking statements, many of which are subject to
significant uncertainties and contingencies beyond our reasonable control,
some of the assumptions inevitably will not materialize and unanticipated
events and circumstances may occur subsequent to the date of this 10-K.
These forward-looking statements are based on current information and
expectation, and we assume no obligation to update them at any stage.
Therefore, our actual experience and results achieved during the period
covered by any particular forward-looking statement may differ substantially
from those anticipated. Consequently, the inclusion of forward-looking
statements should not be regarded as a representation by us or any other
person that these estimates will be realized, and actual results may vary
materially. We can not assure that any of these expectations will be realized
or that any of the forward-looking statements contained herein will prove to
be accurate.
Item 2. DESCRIPTION OF PROPERTY
The Company owns no Property. Our executive offices are located at
968 - 240th Street, Langley, BC, CanadaV2Z 2Y3. Our telephone number is (604)
539-9680. The office premises, which are approximately 1000 square feet, and
include furniture, and equipment have been provided to December 31, 2009 by
the President and majority shareholder Evan Williams.
Item 3. LEGAL PROCEEDINGS
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the Company's shareholders
through the solicitation of proxies, during the fourth quarter of the
Company's fiscal year ended December 31, 2009.
PART II
Item 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock is available for trading on the OTC Bulletin
Board. The following table sets forth the high and low bid price per share of
the company's common stock for each full quarterly period since incorporation
on June 7, 2006 to December 31, 2009.
2006
- ---------
High Low
Third Quarter No Quote No Quote
Fourth Quarter No Quote No Quote
2007
- ---------
High Low
First Quarter No Quote No Quote
Second Quarter No Quote No Quote
Third Quarter No Quote No Quote
Fourth Quarter No Quote No Quote
2008
- ---------
High Low
First Quarter No Quote No Quote
Second Quarter No Quote No Quote
Third Quarter No Quote No Quote
Fourth Quarter No Quote No Quote
2009
- ---------
High Low
First Quarter No Quote No Quote
Second Quarter No Quote No Quote
Third Quarter No Quote No Quote
Fourth Quarter No Quote No Quote
As of December 31, 2009 there was no Quote for the Stock. As of December 31,
2009 there were 56 holders of record of the Common Stock of the Company.
.7.
General
The following description of our capital stock does not purport to be
complete and is subject to and qualified in its entirety by our Articles of
Incorporation, and By-laws, which are included as exhibits.
We are authorized to issue 50,000,000 shares of common stock, $0.001 par
value per share, of which 14,050,000 shares were issued and outstanding as of
December 31, 2009. We are also authorized to issue 20,000,000 preferred
stock, $0.001 par value per share, of which no shares were issued as of
December 31, 2009. The Company did not purchase any securities during the
year-ended December 31, 2009.
Common Stock
Holders of shares of our common stock are entitled to share equally on a per
share basis in such dividends as may be declared by our Board of Directors
out of funds legally available. There are presently no plans to pay
dividends with respect to the shares of our common stock. Upon our
liquidation, dissolution or winding up, after payment of creditors and the
holders of any of our senior securities, if any, our assets will be divided
pro rata on a per share basis among the holders of the shares of our common
stock. The common stock is not subject to any liability for further
assessments. There are no conversion or redemption privileges or any sinking
fund provisions with respect to the common stock. The holders of common stock
do not have any pre-emptive or other subscription rights.
Holders of shares of common stock are entitled to cast one vote for each
share held at all stockholders' meetings for all purposes, including the
election of directors. The common stock does not have cumulative voting
rights.
Our Preferred shares have not been assigned any special or preemptive rights
at this time, nor any cumulative voting rights.
Dividend Policy
We have never declared or paid any cash dividends on our common stock. We
anticipate that any earnings will be retained for development and expansion
of our business and we do not anticipate paying any cash dividends in the
near future. Our Board of Directors has sole discretion to pay cash dividends
with respect to our common stock based on our financial condition, results of
operations, capital requirements, contractual obligations and other relevant
factors.
Equity Compensation Plan Information
No equity compensation plan has been authorized by the Company.
Unregistered Sales of Equity Securities
Following is a summary of unregistered securities issued from inception (June
7, 2006) through December 31, 2009.
On June 7, 2006, we issued an aggregate of 7,600,000 shares of our common
stock, par value $.001 per share, to the founders and Directors of our
company, which included our Chief Executive Officer, our Treasurer, and
Secretary for an aggregate purchase price of $77,173.29.
On September 30, 2006, we issued an aggregate of 6,450,000 shares of our
common stock, par value $.001 per share to the other 53 founders of our
Company for an aggregate purchase price of $65,502.43.
.8.
Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion should be read in conjunction with our financial
statements and attached notes. This discussion may contain forward-looking
statements that could involve risks and uncertainties. For additional
information see "Risk Factors".
Border Management was incorporated on June 7, 2006 however, we have not yet
commenced operations other than research and establish a preliminary business
plan. We invested the majority of the proceeds from our original share
issue in a short term interest bearing note issued by JPI Project Management
Inc., The note was repaid during 2008. JPI Project Management Inc. is a
privately held British Columbia non reporting company owned by Mrs. Jillian
Williams, Evan Williams's wife.
Critical Accounting Policies:
Our financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America, which require
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities at the date of the financial statements, the
disclosure of contingent assets and liabilities, and the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates. The critical accounting policies that affect our
more significant estimates and assumptions used in the preparation of our
financial statements are reviewed and any required adjustments are recorded
on a monthly basis.
Results of Operations:
Substantial positive and negative fluctuations can occur in our business due
to a variety of factors, including variations in the economy, and the
abilities to raise capital. As a result, net income and revenues in a
particular period may not be representative of full year results and may vary
significantly in this early stage of our operations. In addition results of
operations, may vary in the future, and will be materially affected by many
factors of a national and international nature, including economic and market
conditions, currency values, inflation, the availability of capital, the
level of volatility of interest rates, the valuation of security positions
and investments and legislative and regulatory developments. Our results of
operations also may be materially affected by competitive factors and our
ability to attract and retain highly skilled individuals.
Liquidity Management:
Liquidity is the ability to meet current and future financial obligations
of a short-term nature. Our primary sources of funds will consist of
management and consulting revenues. During the next twelve months, we will
continue our research into our specific industry, management systems, and
marketing. We have also commenced operations with the creation of our
website and the marketing of our services. Unless we derive sufficient
revenues from operations, we will be required to issue additional share
capital or secure debt financing. Depending on market conditions, we may be
required to pay high rates of interest on such loans. We no not have enough
cash available to satisfy our requirements during the next twelve months.
Operational Matters:
Over the next twelve months, we do not have enough cash to proceed with
limited research, recruitment, and marketing plans.
Our industry research will be ongoing. We will monitor what services our
competitors offer along with their strengths, weaknesses, and fees. We will
also monitor changes in Federal and Provincial legislation, which is likely
to affect our clients and our ability to deliver professional service.
Our recruiting efforts will be to attract and contract with professionals
such as engineers, lawyers, and accountants outside of our company. We will
also recruit prospective employees and professionals to work within our
company. Employees, however, will only be hired as workload demands. As
such we cannot say at this time how many, if any, will be hired during the
next twelve months.
Our marketing objective will be to solicit clients outside and to a lesser
extent inside of Canada. Our marketing will include the use of newspapers
and internet. We will consider trade journals, various print mediums such as
brochures, and some travel to meet prospective clients. We will change our
website as is necessary.
Primary Investing Activities: We do not anticipate any major investing
activities in the next twelve months. Neither do we expect any major
purchases or sales of plant and equipment.
In addition to the other information set forth in this report, you should
carefully consider the "Risk Factors" in this Annual Report, which could
materially affect our business, financial condition or future
results. The risks described in our Annual Report on Form 10-K are not
the only risks that we face. Additional risks and uncertainties not
currently known to us or that we currently deem to be immaterial also may
materially affect our business, financial condition and/or operating results.
Period Ended December 31, 2009:
We have commenced operations, however we have had no service revenues
to date. Much of our preliminary organization has been completed including
establishing our office premises and accounting system. During the last year,
we initiated our marketing plan. Our focus has been on the following
three areas:
1.Our web-site has been maintained.
2.We have continued discussions with a number of business contacts.
We believe the value of the Canadian dollar as compared to the U.S.
dollar may have a negative and on going impact on our business plans.
Should we be able to develop a client base, we anticipate our services will
be rendered to our clients on both an ongoing basis as well as a one time
and project consulting basis. If engaged on a project or one time basis, we
will recognize revenues at the time that all services have been substantially
completed. At the discretion of our management, we may accept restricted
equity securities in certain entities as payments for services provided to
these entities. Some of these entities may be newly formed, have no operating
history, and the market for such securities would be very limited. In the
event that there is a public market for the securities, we will record the
securities at a discount from the market price, since (i) the securities are
restricted and (ii) there is no assurance that the value of these securities
will be realized. The amount of shares we will accept in lieu of a portion of
a client's cash payment is situation specific.
The major changes in specific accounts in our operating statement for the
year ended December 31, 2009 as compared to the previous period are as
follows:
Revenue
Revenue for the year ended December 31, 2009 was $ 0. Revenue for the year
ended December 31, 2008, $4,600, was derived from interest income only.
Expenses
Advertising costs increased to $333 during the year ended December 31, 2009.
Advertising costs of $167 were incurred during the previous year ended
December 31, 2008.
Management fees of $4,961 were incurred during this year of operations.
$39,841 was paid during the previous year ended December 31,2008.
Professional fees of $14,864 were incurred as compares to $29,611 from
inception to December 31, 2008. Included in fees to December 31, 2009 were
fees of $1,491 paid to S N Ventures Inc., a company owned by the Treasurer.
Listing and Share Transfer fees of $5,429 were incurred for the year ended
December 31, 2009. Our prior period amount to December 31, 2008 was $6,700.
The increase was due to the initial costs paid to Island Stock Transfer of
Florida upon their appointment as our new Listing and Stock Transfer Agent.
Rent, of $2,481 was paid during the year ended December 31, 2009. $10,155 was
paid during the previous year of operations.
The net loss for the year ended December 31, 2009 was $29,501 or $0.00209 per
share compared to a loss of $82,700 for the period ended December 31, 2008,
an decrease of $53,199.
.9.
Off-Balance Sheet Arrangements
We do not have any off balance sheet arrangements that are reasonably likely
to have a current or future effect on our financial condition, revenues,
results of operations, liquidity or capital expenditures.
Shares Eligible for Future Sale
Common Stock
We are authorized to issue an additional 35,950,000 shares of Common Stock;
however, none have been issued to date.
The founders shares(14,050,000) are deemed to be "restricted securities," as
that term is defined under Rule 144 promulgated under the Securities Act.
.10.
Preferred Stock
We are authorized to issue 20,000,000 shares of preferred stock; however none
have been issued to date.
Transfer Agent and Registrar
Our transfer agent is Island Stock Transfer located in St. Petersburg,
Florida.
Resale Restrictions
All of our shares of common stock issued prior to March 25, 2008 are
"restricted securities" as this term is defined under Rule 144, in that such
shares were issued in private transactions not involving a public offering
and may not be sold in the U.S. in the absence of registration other than in
accordance with Rule 144 under the Securities Act of 1933, as amended, or
another exemption from registration. In general, under Rule 144 as currently
in effect, any of our affiliates or any person (or persons whose shares are
aggregated in accordance with Rule 144) who has beneficially owned our common
shares which are treated as restricted securities for at least one (1) year
would be entitled to sell within any three-month period a number of shares
that does not exceed the greater of 1% of our outstanding common shares
(approximately 170,500 shares based upon the number of common shares expected
to be outstanding after our offering) or the reported average weekly trading
volume in our common shares during the four weeks preceding the date on which
notice of such sale was filed under Rule 144. Sales under Rule 144 are also
subject to sale restrictions and notice requirements and to the availability
of current public information concerning our company. In addition, affiliates
of our company must comply with the restrictions and requirements of Rule 144
(other than the one (1) year holding period requirements) in order to sell
common shares that are not restricted securities (such as common shares
acquired by affiliates in market transactions). Furthermore, if a period of
at least two (2) years has elapsed from the date restricted securities were
acquired from us or from one of our affiliates, a holder of these restricted
securities who is not an affiliate at the time of the sale and who has not
been an affiliate for at least three (3) months prior to such sale would be
entitled to sell the shares immediately without regard to the volume, manner
of sale, notice and public information requirements of Rule 144.
Penny Stock Considerations
Broker-dealer practices in connection with transactions in penny stocks are
regulated by certain penny stock rules adopted by the Securities and Exchange
Commission. Penny stocks generally are equity securities with a price of less
than US $5.00. Penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver
a standardized risk disclosure document that provides information about penny
stocks and the risks in the penny stock market. The broker-dealer also must
provide the customer with current bid and offer quotations for the penny
stock, the compensation of the broker-dealer and its salesperson in the
transaction, and monthly account statements showing the market value of each
penny stock held in the customer's account. In addition, the penny stock
rules generally require that prior to a transaction in a penny stock, the
broker-dealer make a special written determination that the penny stock is a
suitable investment for the purchaser and receive the purchaser's written
agreement to the transaction. These disclosure requirements may have the
effect of reducing the level of trading activity in the secondary market for
a stock that becomes subject to the penny stock rules. Our shares may be
subject to such penny stock rules and our shareholders may find it difficult
to sell their securities.
.11.
PLAN OF DISTRIBUTION
Currently there are no shares registered for sale on behalf of the Company.
There are no shares registered for sale on behalf on the existing
Shareholders.
The existing shareholders may sell some or all of their shares as restricted
shares at any price.
Broker-dealers engaged by the selling shareholder may arrange for other
broker-dealers to participate. Broker-dealers may receive commissions or
discounts from the selling shareholder (or, if any such broker-dealer acts as
agent for the purchaser of such shares, from such purchaser) in amounts to be
negotiated. Broker-dealers may agree with the selling shareholder to sell a
specified number of such shares at a stipulated price per share.
The selling shareholders and any broker-dealers participating in the
distributions of the shares may be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act. Any profit on the sale of
shares by the selling shareholder and any commissions or discounts given to
any such broker-dealer may be deemed to be underwriting commissions or
discounts. The shares may also be sold pursuant to Rule 144 under the
Securities Act of 1933, as amended, beginning one (1) year after the shares
were issued.
Under the Securities Exchange Act of 1934 and the regulations there under,
any person engaged in a distribution of the shares of our Common Stock
offered by our prospectus may not simultaneously engage in market making
activities with respect to our Common Stock during the applicable "cooling
off" periods prior to the commencement of such distribution. Also, the
selling shareholder is subject to applicable provisions that limit the timing
of purchases and sales of our Common Stock by the selling shareholder.
.12.
We have informed the selling shareholders that, during such time as he may be
engaged in a distribution of any of the shares we have registered by our
prospectus, he is required to comply with Regulation M. In general,
Regulation M precludes the selling shareholder, any affiliated purchasers and
any broker-dealer or other person who participates in a distribution from
bidding for or purchasing, or attempting to induce any person to bid for or
purchase, any security which is the subject of the distribution until the
entire distribution is complete. Regulation M defines a "distribution" as an
offering of securities that is distinguished from ordinary trading activities
by the magnitude of the offering and the presence of special selling efforts
and selling methods. Regulation M also defines a "distribution participant"
as an underwriter, prospective underwriter, broker, dealer, or other person
who has agreed to participate or who is participating in a distribution.
Regulation M prohibits any bids or purchases made in order to stabilize the
price of a security in connection with the distribution of that security,
except as specifically permitted by Rule 104 of Regulation M. These
stabilizing transactions may cause the price of our Common Stock to be less
volatile than it would otherwise be in the absence of these transactions. We
have informed the selling shareholder that stabilizing transactions permitted
by Regulation M allow bids to purchase our Common Stock if the stabilizing
bids do not exceed a specified maximum. Regulation M specifically prohibits
stabilizing that is the result of fraudulent, manipulative, or deceptive
practices. The selling shareholder and distribution participants are required
to consult with their own legal counsel to ensure compliance with Regulation
M.
.13.
BORDER MANAGEMENT, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
DECEMBER 31, 2009
FINANCIAL STATEMENTS
BORDER MANAGEMENT, INC.
(A Development Stage Company)
INDEX
- ---------------------------------------------------------------------------
Page (s)
- ---------------------------------------------------------------------------
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . F-2
Financial Statements:
Balance Sheets as at December 31, 2009 and December 31, 2008 . . . F-3
Statement of Operations for the Cumulative Period from Inception
June 7, 2006, to December 31, 2009 . . . . . . . . . . . . . . . . F-4
Statement of Shareholders' Equity for the Cumulative Period from
Inception, June 7, 2006 to December 31, 2009 . . . . . . . . . . . F-5
Statement of Cash Flows for the Cumulative Period from Inception,
June 7, 2006 to December 31, 2009. . . . . . . . . . . . . . . . . F-6
Notes to Financial Statement . . . . . . . . . . . . . . . . . . . F-7
.F.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors of:
Border Management, Inc.
We have audited the accompanying balance sheets of Border Management, Inc. as
at December 31, 2009 and 2008 and the related statements of operations,
stockholders' equity and cash flows for each of the three years in the period
ended December 31, 2009. 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 the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform an audit to obtain reasonable assurance whether the
financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, we express no such opinion. 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 the Company as at December
31, 2009 and 2008 and the results of its operations and cash flows for each
of the three years in the period ended December 31, 2009, in conformity with
accounting principles generally accepted in the United States.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has limited capital and has suffered losses
from operations and negative cash flows from operations that raise
substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 1.
The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
/s/ UHY LDMB Advisors Inc.
- --------------------------
UHY LBMB Advisors Inc.
Chartered Accountants
Surrey, British Columbia, Canada
March 29, 2010
.F-2.
Border Management, Inc.
(a development stage company)
Balance Sheets
As At As At
December 31 December 31
2009 2008
- ---------------------------------------------------------------------
ASSETS
- ---------------------------------------------------------------------
Current Assets:
Cash $ 1,747 $ 9,983
Refundable Taxes 249 664
------------ -------------
Total Assets $ 1,996 $ 10,647
============ =============
- ---------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------
Current
Accounts payable and $ 31,641 $ 10,791
accrued liabilities ------------ -------------
- ---------------------------------------------------------------------
STOCKHOLDERS' DEFICIENCY
- ---------------------------------------------------------------------
Common stock, $.001 par value
Authorized: 50,000,000 shares
Issued: 14,050,000 shares 14,050 14,050
Preferred stock,$.001 par value
Authorized: 20,000,000 shares
Issued: Nil
Additional paid-in capital 128,626 128,626
Deficit accumulated during the
development stage (172,321) (142,820)
------------ -------------
Total stockholders' deficiency (29,645) (144)
------------ -------------
Total liabilities and stockholders'
deficiency $ 1,996 $ 10,647
============ =============
GOING CONCERN (Note 1)
The accompanying notes are an integral part of these financial statements.
APPROVED BY THE DIRECTORS:
/s/Evan Williams
- ----------------
Evan William
Director
/s/Leigh Anderson
- -----------------
Leigh Anderson
Director
/s/ Solomon Nordine
- -------------------
Solomon Nordine
Director
.F-3.
Border Management, Inc.
(a development stage company)
Statements of Operations
For the Year For the Year For the Year Period From
Ended Ended Ended June 7, 2006
Dec 31, 2009 Dec 31, 2008 Dec 31, 2007 (inception) to
Dec 31, 2009
- ----------------------------------------------------------------------------------------
REVENUE
Interest Revenue $ - $ 4,600 $ 9,741 $ 17,096
Operating Revenue - - - -
------------- ------------- --------------- --------------
Total Revenue $ - $ 4,600 $ 9,741 $ 17,096
============= ============= =============== ==============
EXPENSES
Advertising 333 167 746 1,247
Bank Charges 240 309 23 600
Foreign Currency
Loss 1,193 517 - 1,710
Listing and Share
Transfer fees 5,429 6,700 6,020 18,399
Management fees 4,961 39,841 17,441 62,243
Professional fees 14,864 29,611 16,759 88,177
Rent 2,481 10,155 4,405 17,041
------------- ------------- -------------- ---------------
Total Expenses 29,501 87,300 45,394 189,417
============= ============= ============== ===============
NET LOSS $ (29,501) $ (82,700) $ (35,653) $ (172,321)
============= ============= ============== ===============
Loss per share $ (0.00) $ (0.01) $ (0.00) $ (0.01)
(Note 2(f)) ============= ============= ============== ===============
Weighted average
number of shares
outstanding 14,050,000 14,050,000 14,050,000 13,480,737
============= ============= ============== ===============
- -----------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
.F-4.
Border Management, Inc.
(a development stage company)
Statement of Stockholders' Equity
For the Period from June 7, 2006 (inception) to December 31, 2009
- -----------------------------------------------------------------------------
Common stock
-------------- Deficit Acc. Total
Number Amount Additional During Devel- Stockholders
Of Shares Paid-in opment Stage Equity
Capital
--------- -------- ----------- --------------- -------------
Issue of Common 7,600,000 $ 7,600 $ 68,400 $ - $ 76,000
Stock for cash
On organization
Of the Company
Issue of Common 6,450,000 $ 6,450 $ 60,226 $ - $ 66,676
Stock for cash
Net loss for
Period - - - $ (24,467) $ (24,467)
--------- -------- ----------- --------------- -------------
Balance 14,050,000 $14,050 $ 128,626 $ (24,467) $ 118,209
December 31,
2006
Net loss for
the period - - - (35,653) (35,653)
--------- -------- ----------- --------------- -------------
Balance
Dec 31,
2007 14,050,000 $14,050 $ 128,626 $ (60,120) $ 82,556
Net loss for
The period - - - (82,700) (82,700)
---------- -------- ----------- --------------- -------------
Balance
Dec 31,
2008 14,050,000 $14,050 $ 128,626 $(142,820) $ (144)
Net loss for
The period - - - (29,501) (29,501)
---------- -------- ----------- --------------- -------------
Balance
Dec 31,
2009 14,050,00 $14,050 $ 128,626 $(172,321) $(29,645)
=========== ======== =========== ================ ============
The accompanying notes are an integral part of these financial statements.
.F-5.
Border Management, Inc.
(a development stage company)
Statement of Cash Flows
For the Year For the Year For the Year Period from
Ended Ended Ended June 7,2006
Dec 31,2009 Dec 31,2008 Dec 31,2007 (inception) to
Dec 31, 2009
- ---------------------------------------------------------------------------------
CASH FLOWS (USED IN)
PROVIDED BY:
OPERATING ACTIVITIES
Net loss $ (29,501) $ (82,700) $ (35,653) $(172,321)
Adjustments to
reconcile net
loss to net cash
used in operating
activities:
Increase in
accounts receivable
and accrued
assets 416 2,269 (2,933) (249)
Increase (Decrease)
In accounts payable
and accrued
liabilities 20,849 84 (11,436) 31,641
----------- ---------- ----------- ------------
(8,236) (80,347) (50,022) (140,929)
=========== ========== =========== ============
INVESTING ACTIVITIES
Promissory note
receivable - 90,000 50,000 -
----------- ---------- ----------- ------------
FINANCING ACTIVITIES
Common stock
issued for cash: - - - 142,676
----------- ---------- ----------- ------------
DECREASE IN CASH (8,236) 9,653 (22) 1,747
----------- ---------- ----------- ------------
CASH, beginning 9,983 330 352 -
----------- ---------- ----------- ------------
CASH, ending $ 1,747 $ 9,983 $ 330 $ 1,747
=========== ========== =========== ============
SUPPLEMENTAL
INFORMATION
Cash paid during
the year to:
Interest $ - $ - $ - $ -
Income taxes $ - $ - $ - $ -
- ---------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
.F-6.
BORDER MANAGEMENT, INC.
(a development stage company)
December 31, 2009
1. 0RGANIZATION AND DEVELOPMENT STAGE ACTIVITIES
The Company was incorporated under the laws of the State of Nevada on June 7,
2006. The company purpose in the Articles of Incorporation is to engage in
any lawful activity or activities in the State of Nevada and throughout the
world. The Company will specialize in offering management and consulting
services to non-Canadian businesses, organizations and individuals wishing to
conduct business in Canada. As of December 31, 2009, the Company is
considered to be in the development stage as the Company is devoting
substantially all of its effort to establishing its new business and the
Company has not generated revenues from its business activities. The Company
has no cash flows from operations. The Company is currently seeking
additional funds through future debt or equity financing to offset future
cash flow deficiencies. Such financing may not be available or may not be
available on reasonable terms. The resolution of this going concern issue is
dependent on the realization of management's plans. If management is
unsuccessful in raising future debt or equity financing, the Company will be
required to liquidate assets and curtail or possibly cease operations.
2 . SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have been prepared in accordance with
accounting principles generally accepted in the United States. Because a
precise determination of many assets and liabilities is dependent on future
events, the preparation of financial statements for a period necessarily
involves the use of estimates which have been made using careful judgment.
The financial statements have, in management's opinion, been properly
prepared within reasonable limits of materiality and within the framework of
the accounting policies summarized below:
a .Cash and cash equivalents
The Company considers all short-term investments, including investments in
certificates of deposit, with a maturity date at purchase of three months
or less to be cash equivalents.
b .Revenue recognition.
Revenue is recognized on the sale and transfer of goods and services.
c .Foreign currencies
The functional currency of the Company is the United States dollar.
Transactions in foreign currencies are translated into United States dollars
at the rates in effect on the transaction date. Exchange gains or losses
arising on translation or settlement of foreign currency denomination
monetary items are included in the statement of operations.
d .Financial instruments
The Company's financial instruments consist of cash, promissory note
receivable, interest receivable, refundable taxes, and accounts payable and
accrued liabilities.
Management is of the opinion that the Company is not subject to significant
interest, currency or credit risks on the financial instruments included in
these financial statements. The fair market values of these financial
instruments approximate their carrying values.
e .Income taxes
The Company follows the asset and liability method of accounting for income
taxes. Under this method, current taxes are recognized for the estimated
income taxes payable for the current period.
Deferred income taxes are provided based on the estimated future tax effects
of temporary differences between financial statement carrying amounts of
assets and liabilities and their respective tax bases as well as the benefit
of losses available to be carried forward to future years for tax purposes.
Deferred tax assets and liabilities are measured using enacted tax rates that
are expected to apply to taxable income in the years in which those temporary
differences are expected to be covered or settled. The effect of deferred tax
assets and liabilities of a change in tax rates is recognized in operations
in the period that includes the enactment date. A valuation allowance is
recorded for deferred tax assets when it is more likely than not that such
deferred tax assets will not be realized.
f .Loss per share
Basic loss per share is computed by dividing loss for the period available to
common stockholders by the weighted average number of common stock
outstanding during the period.
g .Recent accounting pronouncements
In June 2009, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 168 ("SFAS No. 168"), The
FASB Accounting Standards Codification and the Hierarchy of Generally
Accepted Accounting Principles-a replacement of FASB Statement No. 162. The
FASB Accounting Standards Codification ("Codification") will be the single
source of authoritative nongovernmental U.S. generally accepted accounting
principles ("GAAP"). Rules and interpretive releases of the Securities and
Exchange Commission ("SEC") under authority of federal securities laws are
also sources of authoritative GAAP for SEC registrants. SFAS No. 168 is
effective for interim and annual periods ending after September 15, 2009. The
Codification does not change GAAP and did not have a material impact on the
Company's financial statements.
FASB ASC Topic 260, "Earnings Per Share." On January 1, 2009, the company
adopted new authoritative accounting guidance under FASB ASC Topic 260,
"Earnings Per Share," which provides that unvested share-based payment awards
that contain non-forfeitable rights to dividends or dividend equivalents
(whether paid or unpaid) are participating securities and shall be included
in the computation of earnings per share pursuant to the two-class method.
FASB ASC Topic 320, "Investments - Debt and Equity Securities." New
authoritative accounting guidance under ASC Topic 320, "Investments - Debt
and Equity Securities," (i) changes existing guidance for determining whether
an impairment is other than temporary to debt securities and (ii) replaces
the existing requirement that the entity's management assert it has both the
intent and ability to hold an impaired security until recovery with a
requirement that management assert: (a) it does not have the intent to sell
the security; and (b) it is more likely than not it will not have to sell the
security before recovery of its cost basis. Under ASC Topic 320, declines in
the fair value of held-to-maturity and available-for-sale securities below
their cost that are deemed to be other than temporary are reflected in
earnings as realized losses to the extent the impairment is related to credit
losses. The amount of the impairment related to other factors is recognized
in other comprehensive income. The company adopted the provisions of the new
authoritative accounting guidance under ASC Topic 320 during the first
quarter of 2009. Adoption of the new guidance did not have a material impact
on the company's financial statements.
FASB ASC Topic 805, "Business Combinations." On January 1, 2009, new
authoritative accounting guidance under ASC Topic 805, "Business
Combinations," became applicable to the company's accounting for business
combinations closing on or after January 1, 2009. ASC Topic 805 applies to
all transactions and other events in which one entity obtains control over
one or more other businesses. ASC Topic 805 requires an acquirer, upon
initially obtaining control of another entity, to recognize the assets,
liabilities and any non-controlling interest in the acquiree at fair value as
of the acquisition date. Contingent consideration is required to be
recognized and measured at fair value on the date of acquisition rather than
at a later date when the amount of that consideration may be determinable
beyond a reasonable doubt. This fair value approach replaces the cost
allocation process required under previous accounting guidance whereby the
cost of an acquisition was allocated to the individual assets acquired and
liabilities assumed based on their estimated fair value. ASC Topic 805
requires acquirers to expense acquisition-related costs as incurred rather
than allocating such costs to the assets acquired and liabilities assumed, as
was previously the case under prior accounting guidance. Assets acquired and
liabilities assumed in a business combination that arise from contingencies
are to be recognized at fair value if fair value can be reasonably estimated.
If fair value of such an asset or liability cannot be reasonably estimated,
the asset or liability would generally be recognized in accordance with ASC
Topic 450, "Contingencies." Under ASC Topic 805, the requirements of ASC
Topic 420, "Exit or Disposal Cost Obligations," would have to be met in order
to accrue for a restructuring plan in purchase accounting. Pre-acquisition
contingencies are to be recognized at fair value, unless it is a non
contractual contingency that is not likely to materialize, in which case,
nothing should be recognized in purchase accounting and, instead, that
contingency would be subject to the probable and estimable recognition
criteria of ASC Topic 450, "Contingencies."
FASB ASC Topic 810, "Consolidation." New authoritative accounting guidance
under ASC Topic 810, "Consolidation," amended prior guidance to establish
accounting and reporting standards for the non-controlling interest in a
subsidiary and for the deconsolidation of a subsidiary. Under ASC Topic 810,
a non-controlling interest in a subsidiary, which is sometimes referred to as
minority interest, is an ownership interest in the consolidated entity that
should be reported as a component of equity in the consolidated financial
statements. Among other requirements, ASC Topic 810 requires consolidated net
income to be reported at amounts that include the amounts attributable to
both the parent and the non-controlling interest. It also requires
disclosure, on the face of the consolidated income statement, of the amounts
of consolidated net income attributable to the parent and to the non
controlling interest.
Further new authoritative accounting guidance under ASC Topic 810 amends
prior guidance to change how a company determines when an entity that is
insufficiently capitalized or is not controlled through voting (or similar
rights) should be consolidated. The determination of whether a company is
required to consolidate an entity is based on, among other things, an
entity's purpose and design and a company's ability to direct the activities
of the entity that most significantly impact the entity's economic
performance. The new authoritative accounting guidance requires additional
disclosures about the reporting entity's involvement with variable-interest
entities and any significant changes in risk exposure due to that involvement
as well as its affect on the entity's financial statements. The new
authoritative accounting guidance under ASC Topic 810 is effective October 1,
2009 and is not expected to have a significant impact on the company's
financial statements.
FASB ASC Topic 820, "Fair Value Measurements and Disclosures." New
authoritative accounting guidance under ASC Topic 820,"Fair Value
Measurements and Disclosures," affirms that the objective of fair value when
the market for an asset is not active is the price that would be received to
sell the asset in an orderly transaction, and clarifies and includes
additional factors for determining whether there has been a significant
decrease in market activity for an asset when the market for that asset is
not active. ASC Topic 820 requires an entity to base its conclusion about
whether a transaction was not orderly on the weight of the evidence. The new
accounting guidance amended prior guidance to expand certain disclosure
requirements. The company adopted the new authoritative accounting guidance
under ASC Topic 820 in 2009. Adoption of the new guidance did not
significantly impact the company's financial statements.
Further new authoritative accounting guidance (Accounting Standards Update
No. 2009-5) under ASC Topic 820 provides guidance for measuring the fair
value of a liability in circumstances in which a quoted price in an active
market for the identical liability is not available. In such instances, a
reporting entity is required to measure fair value utilizing a valuation
technique that uses (i) the quoted price of the identical liability when
traded as an asset, (ii) quoted prices for similar liabilities or similar
liabilities when traded as assets, or (iii) another valuation technique that
is consistent with the existing principles of ASC Topic 820, such as an
income approach or market approach. The new authoritative accounting guidance
also clarifies that when estimating the fair value of a liability, a
reporting entity is not required to include a separate input or adjustment to
other inputs relating to the existence of a restriction that prevents the
transfer of the liability. The new authoritative accounting guidance under
ASC Topic 820 will be effective for our financial statements beginning
January 1, 2010 and is not expected to have a significant impact on the
company's financial statements.
FASB ASC Topic 825 "Financial Instruments." New authoritative accounting
guidance under ASC Topic 825,"Financial Instruments," requires an entity to
provide disclosures about the fair value of financial instruments in interim
financial information and amends prior guidance to require those disclosures
in summarized financial information at interim reporting periods. The new
interim disclosures required under Topic 825 had no impact on the company's
financial statements.
FASB ASC Topic 855, "Subsequent Events." New authoritative accounting
guidance under ASC Topic 855, "Subsequent Events," establishes general
standards of accounting for and disclosure of events that occur after the
balance sheet date but before financial statements are issued or available to
be issued. ASC Topic 855 defines (i) the period after the balance sheet date
during which a reporting entity's management should evaluate events or
transactions that may occur for potential recognition or disclosure in the
financial statements, (ii) the circumstances under which an entity should
recognize events or transactions occurring after the balance sheet date in
its financial statements, and (iii) the disclosures an entity should make
about events or transactions that occurred after the balance sheet date. The
new authoritative accounting guidance under ASC Topic 855 did not have a
significant impact on the company's financial statements.
3.STOCKHOLDERS' DEFICIENCY:
Common Stock Offerings:
On June 7, 2006, the Company completed a private placement
offering of 7,600,000 common shares to its officers and directors
for $76,000.
On September 30, 2006, the Company completed a private placement
offering of 6,450,000 to its remaining founders for $66,676.
4.RELATED PARTY TRANSACTIONS
a.Included in accounts payable and accrued liabilities is (2009 - $12,595;
2008 - $2,191) owing to the president of the Company.
b.On April 1, 2007, a management agreement was entered into with JPI and all
management fees (2009 - $4,961; 2008 - $39,841) relate to this agreement.
Management fees for July 2009 to December 2009 have been waived.
c.Rental charges are paid on a month-to-month basis to JPI (2009 - $2,480;
2008 - $10,155). Rental charges for July 2009 to December 2009 have been
waived.
d.Professional fees include amounts attributed to S N Ventures Inc. (2009 -
$1,491; 2008 - $20,111), a company controlled by the Treasurer.
These amounts are recorded at the exchange amount based on the amounts paid
and/or received by the parties.
5.INCOME TAXES
- ----------------------------------------------------------------------------
Deferred tax assets and liabilities:
- ----------------------------------------------------------------------------
Deferred tax assets: Dec 31,2009
Operating loss carry-forwards $ 58,589
Valuation allowance (58,589)
- ----------------------------------------------------------------------------
Net Deferred tax asset $ -
============================================================================
Management believes that it is not more likely than not that it will create
sufficient taxable income sufficient to realize its deferred tax assets. It
is reasonably possible these estimates could change due to future income and
the timing and manner of the reversal of deferred tax liabilities. Due to its
losses, the Company has no income tax expense.
The Company has computed its 2009 operating loss carry-forwards for
income tax purposes to be $172,321.
.F-7.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None.
Item 8A. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, we have evaluated the
effectiveness of the design and operation of our disclosure controls and
procedures under the supervision of and with the participation of our Chief
Executive Officer ("CEO") and is also our Chief Financial Officer ("CFO").
Based on this evaluation, our CEO and CFO, concluded that our disclosure
controls and procedure were effective, that there have been no changes in our
internal controls or in other factors that could significantly affect
internal controls subsequent to the evaluation.
Item 8B. OTHER INFORMATION
None.
PART III
Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS;COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
The following table sets forth information about our executive officers, Key
employees and directors as of December 31,2009.
- --------------------------- --------------- ---------------------------
NAME AGE Position
- --------------------------- --------------- ---------------------------
Evan Williams 64 President
Solomon Nordine 29 Treasurer
Leigh Anderson 71 Secretary
- --------------------------- --------------- ---------------------------
Background of Executive Officers, Directors and Significant Employees
Evan Williams. Mr. Williams is a founder, and current President and CEO of
Border Management, Inc. Mr. Williams has over thirty-seven years experience
as an electrical, engineering, and project management consultant. Mr.
Williams has provided professional advice through his own consulting company
to both small and large businesses as well as institutional and government
bodies. Mr. Williams also has experience in business planning, performance
analysis, budgeting, procurement, and quality assurance. Mr. Williams holds a
General Certificate of Education in Mathematics & Physics, University of
Cambridge, Extn. Examinations Syndicate. Also Ordinary National Diplomas in
Mechanical, Electronic, and Electrical Engineering (Great Britain) and Higher
National Diploma in Electrical and Electronic Engineering (Great Britain).
Mr. Williams has received Post Graduate awards for Illuminating Engineering
and Mathematics. Mr. Williams professional affiliations include membership
in the Illuminating Engineering Society and prior membership in the
Electrical Research Association (U.K.) 1967-1971
.14.
Solomon Nordine. Mr. Nordine is a founder , and current Treasurer of Border
Management, Inc. Mr. Nordine has operated his own accounting and business
consulting company for over four years. Mr. Nordine has also provided part
time and full time marketing services for over one year to an import and
distribution business. Mr. Nordine earned a Diploma in Business
Administration and Bachelor of Business Administration from Okanagan
University College as well as a Master of Business Administration from the
University of Phoenix.
Leigh Anderson. Mr. Anderson is founder, and current Secretary of Border
Management, Inc. Mr. Anderson has thirty three years financial experience in
public education. Mr. Anderson's positions have included Secretary
Treasurer, Superintendent of Business and Finance, and Business
Administrator. Mr. Anderson has also worked as an Independent Consultant to
the B.C. Ministry of Education. For ten years Mr. Anderson held various
positions with Canada's largest chartered bank. Mr. Anderson received a
Diploma in Business Administration from the University of Toronto and a
Supervisory Officer's Certificate from the Ontario Ministry of Education.
Compensation of Directors
We currently do not pay our Directors any fee in connection with their role
as members of our Board; however our Board may choose to pay our Directors in
the future dependent on Border Management's income and cash flows. Our
Directors will be reimbursed for travel and out-of-pocket expenses in
connection with their attendance at Board meetings.
Employment Agreements
There are currently no Employment Agreements in place.
Committees of the Board
We currently have no audit committee, compensation committee, nominations and
governance committee of our board of directors.
Indebtedness of Executive Officers and Directors
No executive officer, director or any member of these individuals' immediate
families or any corporation or organization with whom any of these
individuals is an affiliate is or has been indebted to us since the beginning
of our last fiscal year.
Family Relationships
There are no family relationships among our executive officers and directors.
Legal Proceedings
As of December 31, 2009, there are no material proceedings to which any of
our directors, executive officers, affiliates or stockholders is a party
adverse to us.
Code of Ethics
We have not adopted a Code of Ethics within the meaning of Item 406(b) of
Regulation S-B of the Securities Exchange Act of 1934.
Section 16(a) of the Securities Exchange Act of 1934 requires our directors
and executive officers and persons who beneficially own more than ten percent
of a registered class of our equity securities to file with the SEC initial
reports of ownership and reports of change in ownership of common stock and
other equity securities of our company. Officers, directors and greater than
ten percent stockholders are required by SEC regulations to furnish us with
copies of all Section 16 (a) forms they file. Based solely upon a review of
Forms 3 and 4 and amendments thereto furnished to us under Rule 16a-3(e)
during the fiscal year ended December 31, 2009, and Forms 5 and amendments
thereto furnished to us with respect to the fiscal year ended December 31,
2009, we believe that during the year ended December 31, 2009, our executive
officers, directors and all persons who own more than ten percent of a
registered class of our equity securities complied with all Section 16(a)
filing requirements.
.15.
Item 10. EXECUTIVE COMPENSATION
We currently do not pay our Directors any fee in connection with their role
as members of our Board; however our Board may choose to pay our Directors in
the future dependent on Border Management's income and cash flows. Our
Directors will be reimbursed for travel and out-of-pocket expenses in
connection with their attendance at Board meetings.
Outstanding Equity Awards at Fiscal Year-End Table.
None.
Director Compensation
None.
Employment Agreements
None.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth, as of December 31, 2009 information
regarding the beneficial ownership of our common stock by each person we know
to own five percent or more of the outstanding shares, by each of the
directors, and officers. As of December 31, 2009, there were 14,050,000
shares of our common stock outstanding.
Beneficial ownership has been determined in accordance with Rule 13d-3 of the
Exchange Act. Generally, a person is deemed to be the beneficial owner of a
security if he has the right to acquire voting or investment power within 60
days. Subject to community property laws, where applicable, the persons or
entities named in the table above have sole voting and investment power with
respect to all shares of our common stock indicated as beneficially owned by
them.
.16.
- ----------------------------------------------------------
Percentage of Shares Beneficially Owned
Name and Address Number of Shares Percentage of Shares
Of Beneficial Beneficially Owned
Owner
- ----------------- ------------------ --------------------
Evan Williams 7,500,000 53.38%
968 - 240 St.
Langley, BC
Canada, V2Z 2Y3
Solomon Nordine 50,000 .35%
542 264th Street
Aldergrove, B.C.
Canada, V4W 2M1
Leigh Anderson 50,000 .35%
17316 Hillview Pl.
Surrey, BC
Canada
- ----------------- ------------------- --------------------
The following table sets forth information concerning the beneficial
ownership of shares of our Common Stock with respect to stockholders who were
known by us to be beneficial owners of more than 5% of our Common Stock as of
December 31, 2009. Unless otherwise indicated, the beneficial owner has sole
voting and investment power with respect to such shares of Common Stock.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. In accordance with the
Securities and Exchange Commission rules, shares of our Common Stock which
may be acquired upon exercise of stock options or warrants which are
currently exercisable or which become exercisable within sixty (60) days of
the date of the table are deemed beneficially owned by the optionees. Subject
to community property laws, where applicable, the persons or entities named
in the table above have sole voting and investment power with respect to all
shares of our Common Stock indicated as beneficially owned by them.
Percentage ownership is based on 14,050,000 shares of Common Stock
outstanding as of December 31, 2009.
There is no public trading market for our shares of common stock. In addition
to Mr. Evan Williams our President, we have 55 shareholders, none of which
owns more than 5% of the total shares outstanding.
- -----------------------------------------------------------------------------
Percentage of Shares Beneficially Owned
Name and Address Number of Shares Percentage of Shares After the Offering
Of Beneficial Beneficially Owned Shares Before the Assuming All Are
Owner Offering Sold
- ----------------- ------------------ -------------------- ------------------
Evan Williams 7,500,000 53.38% 43.98%
- ----------------- ------------------ -------------------- ------------------
.17.
Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE
There were no material related party transactions which we entered into from
inception (June 7, 2006) to December 31, 2009.
Item 13. EXHIBITS
Exhibit Description
No.
3.1 Articles of Incorporation of Border Management, Inc. filed with
Nevada Secretary of State on June 7, 2006. (1)
3.4 Bylaws of Border Management, Inc. (1)
23.1 Consent of UHY LDMB Advisors Inc. (filed herewith)
Material Contracts
31.1 Certification by Chief Executive Officer pursuant to Sarbanes -
Oxley Section 302 (filed herewith)
31.2 Certification by Chief Financial Officer pursuant to Sarbanes -
Oxley Section 302 (filed herewith)
32.1 Certification by Chief Executive Officer pursuant to section 906 of
the Sarbanes-Oxley Act of 2002 (filed herewith)
32.2 Certification by Chief Financial Officer pursuant to section 906 of
the Sarbanes-Oxley Act of 2002 (filed herewith)
Notes
(1) Incorporated by reference to the Company's Registration Statement
on Form SB-2 filed with the SEC on December 5, 2006.
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees
The aggregate fees billable to us by UHY LDMB Advisors Inc. during 2009 for
the audit of our annual financial statements for the fiscal year totaled
$6,250.
Audit-Related Fees
We incurred assurance and audit-related fees during 2009 of $9,653 to UHY
LDMB Advisors Inc. in connection with the audit of the financial statements
of Border Management, Inc. from June 7, 2006 (Inception) through December 31,
2009 and for the reviews of registration statements and issuance of related
consents and assistance with SEC comment letters.
Tax Fees
We incurred fees of $0 billed to us by UHY LDMB Advisors Inc. for services
rendered to us for tax compliance, tax advice, or tax planning for the fiscal
year ended December 31, 2009.
All Other Fees
There were no fees billed to us by UHY LDMB Advisors Inc. for services
rendered to us during the last fiscal year, other than the services described
above under "Audit Fees" and Audit-Related Fees."
As of the date of this filing, our current policy is not engage UHY LDMB
Advisors Inc. to provide, among other things, bookkeeping services, appraisal
or valuation services, or international audit services. The policy provides
that we engage UHY LDMB Advisors Inc to provide audit, tax, and other
assurance services, such as review of SEC reports or filings.
.18.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange
Act, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Border Management, Inc.
By: /s/ Evan Williams
- ---------------------
Evan Williams
Chief Executive Officer,
President
Date: March 29, 2010
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on
the dates indicated:
SIGNATURE TITLE DATE
/s/ Evan Williams Chief Executive Officer, March 29, 2010
- ----------------- President, Director
Evan Williams
/s/ Solomon Nordine Chief Financial Officer, March 29, 2010
- ------------------- Treasurer, Director
Solomon Nordine
/s/Leigh Anderson
- ----------------- Secretary, Director March 29, 2010
Leigh Anderson