Attached files
file | filename |
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EX-10.1 - MEMORANDUM OF LEASE. - MONAR INTERNATIONAL INC. | exh101.htm |
EX-23.1 - CONSENT OF MALONE & BAILEY, PC. - MONAR INTERNATIONAL INC. | exh231.htm |
Registration
No. 333-161566
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_________________
FORM
S-1/A-1
REGISTRATION
STATEMENT UNDER
THE
SECURITIES ACT OF 1933
MONAR
INTERNATIONAL INC.
(Name of
small business issuer in its charter)
Nevada
|
5700
|
(State
or Other Jurisdiction of Organization)
|
(Primary
Standard Industrial Classification
Code)
|
_________________
Suite
1302, Sino Favour Centre
|
National
Registered Agents Inc. of NV
|
1
On Yip Street
|
1000
East Williams Street, Suite 204
|
Chaiwan
|
Carson
City, Nevada 89701
|
Hong
Kong, China
|
800-550-6724
|
852-9738-1945
|
|
(Address
and telephone number of registrant's
|
(Name,
address and telephone
|
executive
office)
|
number
of agent for service)
|
_________________
Copies
to:
The
Law Office of Conrad C. Lysiak, P.S.
601
West First Avenue, Suite 903
Spokane,
Washington 99201
509-624-1475
APPROXIMATE DATE OF COMMENCEMENT OF
PROPOSED SALE TO THE PUBLIC:
If any of
the securities being registered on the Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the
following box: [X]
If this
Form is filed to register additional common stock for an offering under Rule
462(b) of the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.
If this
Form is a post-effective amendment filed under Rule 462(c) of the Securities
Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering.
If this
Form is a post-effective amendment filed under Rule 462(d) of the Securities
Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering.
[ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act. (Check one):
Large
Accelerated Filer
|
[ ]
|
Accelerated
Filer
|
[ ]
|
|
Non-accelerated
Filer
|
[ ]
|
Smaller
Reporting Company
|
[X]
|
|
(Do
not check if a smaller reporting company)
|
CALCULATION
OF REGISTRATION FEE
Securities
to be
|
Amount
To Be
|
Offering
Price Per
|
Aggregate
|
Registration
Fee
|
|||
Registered
|
Registered
|
Share
|
Offering
Price
|
[1]
|
|||
Common
Stock:
|
1,500,000
|
$
|
0.10
|
$
|
150,000
|
$
|
8.37
|
[1]
Estimated solely for purposes of calculating the
registration fee under Rule 457.
REGISTRANT
HEREBY AMENDS THIS REGISTRATION STATEMENT ON DATES AS MAY BE NECESSARY TO DELAY
ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH
SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933, OR
UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON DATES AS THE
COMMISSION, ACTING UNDER SAID SECTION 8(a), MAY DETERMINE.
- 2 -
Prospectus
MONAR
INTERNATIONAL INC.
Shares
of Common Stock
750,000
minimum - 1,500,000 Maximum
Before this offering, there has been no
public market for the common stock and after this offering there will be no
public market for the common stock.
This offering will begin on the
effective date of this registration statement. That date is set forth
below as “The date of this prospectus is ___________________” and will terminate
270 days later on _________________, 2010, or on the date the maximum number of
shares are sold, which ever date is
earlier .
We are offering up to a total of
1,500,000 shares of common stock in a direct public offering, without any
involvement of underwriters or broker-dealers, 750,000 shares minimum, 1,500,000
shares maximum. The offering price is $0.10 per
share. Funds from this offering will be placed in a separate bank
account at Hongkong and
Shanghai Banking Corporation Limited (HSBC) , Main Branch, 1
Queen’s Road Central, Hong Kong. Its telephone number is (852)
2748-8288. There is no escrow, trust or similar account in which your
subscription will be deposited. The bank account is merely a separate
interest bearing savings account under our control where we have segregated your
funds. As a result, creditors could attach the funds. Only
Robert Clarke, our sole officer and director will have access to the account.
You will not have the right to withdraw your funds during the offering. You will
only receive your funds back if we do not raise the minimum amount of the
offering within 270 days. The funds will be maintained in the
separate bank until we receive a minimum of $75,000 at which time we will remove
those funds and use the same as set forth in the Use of Proceeds section of this
prospectus. In the event that 750,000 shares are not sold within 270
days, all money received by us will be promptly, returned to you without
interest and without deduction of any kind. We will return your funds
to you in the form a cashier’s check sent Federal Express on the 271st
day. Sold securities are deemed securities which have been paid for
with collected funds prior to expiration of 270 days. Collected funds
are deemed funds that have been paid by the drawee bank. Hongkong and Shanghai Banking
Corporation Limited (HSBC) will determine if the securities have been paid for
with collected funds prior to the expiration of 270
days .
There are no
minimum purchase requirements for each investor .
Our common stock will be sold by Robert
Clarke, our sole officer and director.
Investing in our common stock involves
risks. See "Risk Factors" starting at page 7.
|
Offering
Price
|
Expenses
|
Proceeds
to Us
|
|||||
Per
Share – Minimum
|
$
|
0.10
|
$
|
0.04
|
$
|
0.06
|
||
Per
Share – Maximum
|
$
|
0.10
|
$
|
0.02
|
$
|
0.08
|
||
Minimum
|
$
|
75,000
|
$
|
30,000
|
$
|
45,000
|
||
Maximum
|
$
|
150,000
|
$
|
30,000
|
$
|
120,000
|
- 3 -
The difference between the aggregate
offering price and the proceeds to us is $30,000. The $30,000 will be paid to
unaffiliated third parties for expenses connected with this offering. The
$30,000 will be paid from the first proceeds of this offering.
Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of
these securities or determined if this prospectus is truthful or complete. It is
illegal to tell you otherwise.
The date of this prospectus is
____________________.
- 4 -
TABLE
OF CONTENTS
|
Page
No.
|
Summary
of Prospectus
|
6
|
Risk
Factors
|
7
|
Use
of Proceeds
|
11
|
Determination
of Offering Price
|
12
|
Dilution
of the Price You Pay for Your Shares
|
12
|
Plan
of Distribution; Terms of the Offering
|
15
|
Management’s
Discussion and Analysis of Financial Condition or Plan of
Operation
|
18
|
Business
|
21
|
Management
|
27
|
Executive
Compensation
|
29
|
Principal
Stockholders
|
30
|
Description
of Securities
|
32
|
Certain
Transactions
|
33
|
Litigation
|
33
|
Experts
|
34
|
Legal
Matters
|
34
|
Financial
Statements
|
34
|
- 5 -
SUMMARY
OF OUR OFFERING
Our
business
We are a start-up stage company. We are
a company without revenues or operations; we have minimal assets and have
incurred losses since inception. We are developing a website
(www.monarinternational.com) that will offer to the public a tasteful
traditional style Chinese furniture adapted to modern needs for Asian ethnic and
high end markets in North America. We have spent nominal time designing the
website. We intend to retain the services of a website developer to
create the website . We have not generated any revenues
and the only operations we have engaged in is planning our website and the
development of a business plan.
Our principal executive office is
located at Suite 1302, Sino Favour Centre, 1 On Yip Street, Chaiwan, Hong Kong,
China. Our telephone number is 852-9738-1945 and our registered agent
for service of process is the National Registered Agents Inc. of NV, located at
1000 East William Street, Suite 204, Carson City, Nevada 89701. Our fiscal year
end is July 31.
The
offering
Following is a brief summary of this
offering:
Securities
being offered
|
Up
to 1,500,000 shares of common stock, par value
$0.00001.
|
Offering
price per share
|
$
0.10
|
Offering
period
|
The
shares are being offered for a period not to exceed 270
days.
|
Net
proceeds to us
|
$45,000
assuming the minimum number of shares is sold. $120,000
assuming the maximum number of shares is sold.
|
Use
of proceeds
|
We
will use the proceeds to pay for administrative expenses, the
implementation of our business plan, and working
capital.
|
Number
of shares outstanding before the offering
|
5,000,000
|
Number
of shares outstanding after the offering if all of the shares are
sold
|
6,500,000
|
Selected
financial data
The following financial information
summarizes the more complete historical financial information at the end of this
prospectus.
As
of July 31, 2009
|
||
(Audited)
|
||
Balance
Sheet
|
||
Total
Assets
|
$
|
2,230
|
Total
Liabilities
|
$
|
18,768
|
Stockholders’
Deficiency
|
$
|
(16,538)
|
- 6 -
Period
from
|
||
July
6, 2009 (date of inception) to
|
||
|
July
31, 2009 (Audited)
|
|
Income
Statement
|
||
Revenue
|
$
|
Nil
|
Total
Expenses
|
$
|
16,588
|
Net
Loss
|
$
|
(16,588)
|
RISK
FACTORS
Please consider the following risk
factors before deciding to invest in our common stock.
Risks
associated with MONAR INTERNATIONAL INC.
1. Because our auditors have issued a
going concern opinion and because our sole officer and director will not loan
any additional money to us, we have to complete this offering to commence
operations. If we do not complete this offering, we will not start our
operations.
Our auditors have issued a going
concern opinion. This means that there is doubt that we will be an ongoing
business for the next twelve months. As of the date of this prospectus, we have
not commenced operations. Because our sole officer and director are unwilling to
loan or advance any additional capital to us, except to prepare and file reports
with the SEC, we will have to complete this offering in order to commence
operations.
2. We lack an operating history and
have losses that we expect to continue into the future. There is no assurance
our future operations will result in profitable revenues. If we cannot generate
sufficient revenues to operate profitably, we may suspend or cease
operations.
We were incorporated in July 2009 and
we have not started our proposed business operations or realized any revenues.
We have no operating history upon which an evaluation of our future success or
failure can be made. Our net loss since inception is $16,588 of which $15,000 is
for legal fees, $0 is for audit fees, $1,000 for professional services and $588
is for filing fees and general office expenses. Our ability to
achieve and maintain profitability and positive cash flow is dependent
upon:
* completion
of this offering
* our
ability to locate distributors who will sell their products to us
* our
ability to attract customers who will buy our products
* our
ability to generate revenues through the sale of our products
Based upon current plans, we expect to
incur operating losses in future periods because we will be incurring expenses
and not generating revenues. We cannot guarantee that we will be successful in
generating revenues in the future. Failure to generate revenues will
cause us to suspend or cease operations.
- 7 -
3. We have no
customers and we
cannot guarantee we will ever have any. Even if we obtain customers , there is no
assurance that we will make a profit.
We have no customers . We have not identified any customers and we cannot guarantee we
ever will have any. Even if we obtain customers , there is no guarantee that we will be able to locate
our customers who will buy our products. If we are unable to
attract enough suppliers to offer their products for resale to us to offer our
customers , or enough customers to buy the produc ts from us and our website to
operate profitably we will have to suspend or cease
operations .
4. We are solely dependent upon the
funds to be raised in this offering to start our business, the proceeds of which
may be insufficient to achieve revenues. We may need to obtain additional
financing which may not be available.
We have not started our business. We
need the proceeds from this offering to start our operations. If the
minimum of $75,000 is raised, this amount will enable us, after paying the
expenses of this offering, to begin operations. It will also enable
us to initiate development on our website, begin the gathering of information
for our database, initiate the development of our marketing
program. We may need additional funds to complete further development
of our business plan to achieve a sustainable sales level where ongoing
operations can be funded out of revenues. There is no assurance that any
additional financing will be available or if available, on terms that will be
acceptable to us.
5. Because we are
small and do not have much capital, we must limit marketing our services to
customers and suppliers . As a result, we
may not be able to attract enough customers to operate
profitably. If we do not make a profit, we may have to suspend or cease
operations .
Because we are small and do not have much capital, we
must limit marketing our products. The sale of our products via our
website is how we will initially generate revenues. Because we will be limiting
our marketing activities, we may not be able to attract enough
customers to buy or suppliers to sell
products to operate profitably. If we cannot operate profitably, we may have to
suspend or cease operations .
6.
Because our sole
officer and director will only be devoting limited time to our operations, our
operations may be sporadic which may result in periodic interruptions or
suspensions of operations. This activity could prevent us from attracting
suppliers and
customers and result
in a lack of revenues that may cause us to suspend or cease
operations .
Our sole officer and director, Robert
Clarke, will only be devoting limited time to our operations. Mr. Clarke will be
devoting approximately 15 hours per week of his time to our
operations. Because our sole officer and director will only be
devoting limited time to our operations, our operations may be sporadic and
occur at times which are convenient to him. As a result, operations may be
periodically interrupted or suspended which could result in a lack of revenues
and a possible cessation of operations.
- 8 -
7. Because our management does not have
prior experience in the marketing of products or services via the Internet, we
may have to hire individuals or suspend or cease operations.
Because our management does not have
prior experience in the marketing of products or services via the Internet, we
may have to hire additional experienced personnel to assist us with our
operations. If we need the additional experienced personnel and we do not hire
them, we could fail in our plan of operations and have to suspend operations or
cease operations entirely.
8. Because we have
only one officer and director who has no formal training in financial accounting
and management, who is responsible for our managerial and organizational
structure, in the future, there may not be effective disclosure and accounting
controls to comply with applicable laws and regulations which could result in
fines, penalties and assessments against us.
We have only one officer and
director. He has no formal training in financial accounting and
management, however, he is responsible for our managerial and organizational
structure which will include preparation of disclosure and accounting controls
under the Sarbanes Oxley Act of 2002. While Mr. Clarke has no formal
training in financial accounting matters, he has been preparing the financial
statements that have been audited and reviewed by our auditors and included in
this prospectus. When the disclosure and accounting controls referred to above
are implemented, he will be responsible for the administration of
them. Should he not have sufficient experience, he may be incapable
of creating and implementing the controls. Lack of proper controls could cause the financial
statements to be inaccurate which may cause us to be subject to sanctions and
fines by the SEC which ultimately could cause you to lose your investment,
however, because of the small size of our expected operations, we believe that
he will be able to monitor the controls he will have created and will be
accurate in assembling and providing information to
investors .
9. If Robert Clarke, our president and
a director, should resign or die, we will not have a chief executive officer
which could result in our operations suspending. If that should
occur, you could lose your investment.
Robert Clarke is our sole officer and
director. We are extremely dependent upon him to conduct our
operations. If he should resign or die, we will not have a chief
executive officer. If that should occur, until we find another person
to act as our chief executive officer, our operations could be
suspended. In that event, it is possible you could lose your entire
investment.
10. Because we do not have
an escrow or trust account for your subscription, if we file for bankruptcy
protection or are forced into bankruptcy, or a creditor obtains a judgment
against us and attaches the subscription, or our sole officer and director
misappropriate the funds for their own use, you will lose your
investment.
Your funds will not be placed in an
escrow or trust account. Accordingly, if we file for bankruptcy
protection or a petition for involuntary bankruptcy is filed by creditors
against us, your funds will become part of the bankruptcy estate and
administered according to the bankruptcy laws. If a creditor sues us
and obtains a judgment against us, the creditor could garnish the bank account
and take possession of the subscriptions. As such, it is possible
that a creditor could attach your subscription which could preclude or delay the
return of money to you. Further, sole officer and director will have
the power to appropriate the money we raise. As such, they could
withdraw the funds without your knowledge for their own use. If that
happens, you will lose your investment and your funds will be used to pay
creditors.
- 9 -
11. Since our headquarters are located
in China and most of our assets and key personnel are located in Hong
Kong, you may not be able to enforce any United States judgment for claims you
may bring against us, our assets, our key personnel or the experts named in this
prospectus.
While we are organized under the laws
of State of Nevada, our headquarters and sole officer and director are located
outside the United States. As a result, it may be impossible for you
to affect service of process within the United States upon us or these persons
or to enforce against us or these persons any judgments in civil and commercial
matters, including judgments under United States federal securities
laws. In addition, a Chinese court may not permit you to bring an
original action in China or to enforce in China a judgment of a U.S. court based
upon civil liability provisions of U.S. federal securities laws.
12. Because we do not
maintain any product liability insurance, if we are sued by a person injured by
a defective product we sell, we could cease operations .
We do not
maintain any product liability insurance. As a result, if someone is
injured as a result of using furniture we sell, we could be
sued. If we do not have funds to defend the suit or if a large
judgment is rendered against us, we could be forced to cease operating and you
could loose your investment.
13. A permanent loss of data or a
permanent loss of service on the Internet will have an adverse affect on our
operations and will cause to cease doing business .
Our operations depend entirely on the
Internet. If we permanently lose data or permanently lose Internet
service for any reason, be it technical failure or criminal acts, we will have
to cease operations and you will lose your
investment.
Risks
associated with this offering:
14. Because our sole officer and
director who is also our sole promoter, will own more than 50% of the
outstanding shares after this offering, he will retain control of us and be able
to decide who will be directors and you may not be able to elect any directors
which could decrease the price and marketability of the
shares.
Even if we sell all 1,500,000 shares of
common stock in this offering, Robert Clarke will still own 5,000,000 shares and
will continue to control us. As a result, after completion of this
offering, regardless of the number of shares we sell, Mr. Clarke will be able to
elect all of our directors and control our operations, which could decrease the
price and marketability of the shares.
15. Because there is no public trading
market for our common stock, you may not be able to resell your
stock.
There is currently no public trading
market for our common stock. Therefore there is no central place, such as stock
exchange or electronic trading system, to resell your shares. If you do want to
resell your shares, you will have to locate a buyer and negotiate your own
sale.
- 10 -
16. Because the SEC imposes additional
sales practice requirements on brokers who deal in our shares that are penny
stocks, some brokers may be unwilling to trade them. This means that you may
have difficulty reselling your shares and this may cause the price of the shares
to decline.
Our shares would be classified as penny
stocks and are covered by Section 15(g) of the Securities Exchange Act of 1934
and the rules promulgated thereunder which impose additional sales practice
requirements on brokers/dealers who sell our securities in this offering or in
the aftermarket. For sales of our securities, the broker/dealer must
make a special suitability determination and receive from you a written
agreement prior to making a sale for you. Because of the imposition
of the foregoing additional sales practices, it is possible that brokers will
not want to make a market in our shares. This could prevent you from
reselling your shares and may cause the price of the shares to
decline.
USE
OF PROCEEDS
Our offering is being made on a
self-underwritten $75,000 minimum, $150,000 maximum basis. The table
below sets forth the use of proceeds if $75,000, $100,000, or $150,000 of the
offering is sold.
|
$75,000
|
$100,000
|
$150,000
|
|||
Gross
proceeds
|
$
|
75,000
|
$
|
100,000
|
$
|
150,000
|
Offering
expenses
|
$
|
30,000
|
$
|
30,000
|
$
|
30,000
|
Net
proceeds
|
$
|
45,000
|
$
|
70,000
|
$
|
120,000
|
The net proceeds will be used as
follows:
Website
development
|
$
|
5,000
|
$
|
7,500
|
$
|
10,000
|
Database
|
$
|
5,000
|
$
|
12,500
|
$
|
20,000
|
Marketing
and advertising
|
$
|
15,000
|
$
|
25,000
|
$
|
35,000
|
Establishing an
office
|
$
|
10,000
|
$
|
10,000
|
$
|
10,000
|
Salaries
|
$
|
0
|
$
|
12,500
|
$
|
25,000
|
Working
capital
|
$
|
10,000
|
$
|
15,000
|
$
|
20,000
|
Total offering expenses to be paid from
the proceeds of the offering are $25,000 for legal fees; $200 for printing our
prospectus; $4,500 for accounting/administrative fees; $500 for state securities
registration fees; $200 for our transfer agent; and $8.37 for our SEC filing
fee. The foregoing are approximations.
We will be able to begin operations
with the minimum funds described above. By raising additional
amounts, we will have the ability to create a better website with more options;
a better data base that will allow us to analyze the data in more ways; increase
marketing and advertising; add one or two additional employees; and, provide for
additional working capital .
We will spend between $5,000 and
$10,000 for the preparation of our website which includes the cost of content
creation and links to and from our website. We have spent nominal time designing the
website. We intend to retain the services of a website developer to
create the website.
- 11 -
We intend to develop and maintain a
database of suppliers and customers. The estimated cost to develop
and maintain the database is $5,000 to $20,000.
Marketing and advertising will be
focused on promoting products to the public. We also intend to print
sales material for distribution in newspapers. The cost of developing
the campaign is estimated to cost between $15,000 to $35,000.
We have
leased office space at a monthly rate of $65. We will use $10,000 of
the proceeds of this offering to cover the
cost of the office space and maintain the
website and database. The $10,000 will pay
for the physical office space, computer equipment,
telephones and other assets as required to maintain the operations.
If we raise at
least $100,000, we intend to pay a salary
to Robert Clarke, our sole officer and director. In addition, we
intend to hire one or two sales employees to handle Internet transactions with
our customers.
Working capital is the cost related to
operating our office. It is comprised of expenses for rent, telephone
service, mail, stationary, accounting, acquisition of office equipment and
supplies, expenses of filing reports with the SEC, travel, and general working
capital.
DETERMINATION
OF OFFERING PRICE
The price of the shares we are offering
was arbitrarily determined in order for us to raise up to a total of $150,000 in
this offering. The offering price bears no relationship whatsoever to our
assets, earnings, book value or other criteria of value. Among the factors
considered were:
* our
lack of operating history
* the
proceeds to be raised by the offering
*
|
the
amount of capital to be contributed by purchasers in this offering in
proportion to the amount of stock to be retained by our existing
Stockholder, and
|
* our
relative cash requirements.
DILUTION
OF THE PRICE YOU PAY FOR YOUR SHARES
Dilution represents the difference
between the offering price and the net tangible book value per share immediately
after completion of this offering. Net tangible book value is the amount that
results from subtracting total liabilities and intangible assets from total
assets. Dilution arises mainly as a result of our arbitrary determination of the
offering price of the shares being offered. Dilution of the value of the shares
you purchase is also a result of the lower book value of the shares held by our
existing stockholders.
As of July 31, 2009, the net tangible
book value of our shares of common stock was a deficit of ($16,538) or
approximately ($0.00331) per share based upon 5,000,000 shares
outstanding.
- 12 -
If
100% of the Shares Are Sold:
Upon completion of this offering, in
the event all of the shares are sold, the net tangible book value of the
6,500,000 shares to be outstanding will be $103,462 or approximately $0.01592
per share. The net tangible book value of the shares held by our existing
stockholders will be increased by $0.01922 per share without any additional
investment on their part. You will incur an immediate dilution from $0.10 per
share to $0.08408 per share.
After completion of this offering, if
1,500,000 shares are sold, you will own approximately 23.08% of the total number
of shares then outstanding for which you will have made a cash investment of
$150,000, or $0.10 per share. Our existing stockholders will own approximately
76.92% of the total number of shares then outstanding, for which they have made
contributions of cash totaling $50.00 or approximately $0.00001 per
share.
If
1,000,000 Shares Are Sold:
Upon completion of this offering, in
the event 1,000,000 shares are sold, the net tangible book value of the
6,000,000 shares to be outstanding will be $53,462, or approximately $0.00891
per share. The net tangible book value of the shares held by our existing
stockholders will be increased by $0.01222 per share without any additional
investment on their part. You will incur an immediate dilution from $0.10 per
share to $0.09109 per share.
After completion of this offering, if
1,000,000 shares are sold, you will own approximately 16.67% of the total number
of shares then outstanding for which you will have made a cash investment of
$100,000, or $0.10 per share. Our existing stockholders will own approximately
83.33% of the total number of shares then outstanding, for which they have made
contributions of cash totaling $50.00 or approximately $0.00001 per
share.
If
750,000 Shares Are Sold:
Upon completion of this offering, in
the event 750,000 shares are sold, the net tangible book value of the 5,750,000
shares to be outstanding will be $28,462, or approximately $0.00495 per share.
The net tangible book value of the shares held by our existing stockholders will
be increased by $0.00826 per share without any additional investment on their
part. You will incur an immediate dilution from $0.10 per share to $0.09505 per
share.
After completion of this offering, if
750,000 shares are sold, you will own approximately 13.04% of the total number
of shares then outstanding for which you will have made a cash investment of
$75,000, or $0.10 per share. Our existing stockholders will own approximately
86.96% of the total number of shares then outstanding, for which they have made
contributions of cash totaling $50.00 or approximately $0.00001 per
share.
The following table compares the
differences of your investment in our shares with the investment of our existing
stockholders.
- 13 -
Existing
Stockholders if all of the Shares are Sold:
Price
per share
|
$
|
0.00001
|
Net
tangible book value per share before offering
|
$
|
(0.00331)
|
Potential
gain to existing shareholders
|
$
|
120,000
|
Net
tangible book value per share after offering
|
$
|
0.01592
|
Increase
to present stockholders in net tangible book value per
share
|
||
after
offering
|
$
|
0.01922
|
Capital
contributions
|
$
|
50.00
|
Number
of shares outstanding before the offering
|
5,000,000
|
|
Number
of shares after offering assuming the sale of the maximum
|
||
number
of shares
|
6,500,000
|
|
Percentage
of ownership after offering
|
76.92%
|
Purchasers of Shares in this Offering
1,500,000 Shares Sold
Price
per share
|
$
|
0.10
|
Dilution
per share
|
$
|
0.08408
|
Capital
contributions
|
$
|
150,000
|
Number
of shares after offering held by public investors
|
1,500,000
|
|
Percentage
of capital contributions by existing shareholders
|
0.04%
|
|
Percentage
of capital contributions by new investors
|
99.96%
|
|
Percentage
of ownership after offering
|
23.08%
|
Purchasers
of Shares in this Offering if 67% of Shares Sold
Price
per share
|
$
|
0.10
|
Dilution
per share
|
$
|
0.09109
|
Capital
contributions
|
$
|
100,000
|
Number
of shares after offering held by public investors
|
1,000,000
|
|
Percentage
of capital contributions by existing shareholders
|
0.05%
|
|
Percentage
of capital contributions by new investors
|
99.95%
|
|
Percentage
of ownership after offering
|
16.67%
|
Purchasers
of Shares in this Offering if 50% of Shares Sold
Price
per share
|
$
|
0.10
|
Dilution
per share
|
$
|
0.09505
|
Capital
contributions
|
$
|
75,000
|
Percentage
of capital contributions by existing shareholders
|
0.07%
|
|
Percentage
of capital contributions by new investors
|
99.93%
|
|
Number
of shares after offering held by public investors
|
750,000
|
|
Percentage
of ownership after offering
|
13.04%
|
- 14 -
PLAN
OF DISTRIBUTION; TERMS OF THE OFFERING
We are offering 1,500,000 shares of
common stock on a self-underwritten basis, 750,000 shares minimum, 1,500,000
shares maximum basis. The offering price is $0.10 per share. Funds from this
offering will be placed in a separate bank account at Hongkong and Shanghai Banking
Corporation Limited (HSBC) , Main Branch, 1 Queen’s Road
Central, Hong Kong. Its telephone number is
852-2748-8288. The funds will be maintained in the separate bank
until we receive a minimum of $75,000 at which time we will remove those funds
and use the same as set forth in the Use of Proceeds section of this
prospectus. This account is not an escrow, trust or similar
account. It is merely a separate interest bearing savings account
under our control where we have segregated your funds. Your
subscription will only be deposited in a separate bank account under our
name. As a result, if we are sued for any reason and a judgment is
rendered against us, your subscription could be seized in a garnishment
proceeding and you could lose your investment, even if we fail to raise the
minimum amount in this offering. Further, if we file a voluntary
bankruptcy petition or our creditors file an involuntary bankruptcy petition,
our assets will be seized by the bankruptcy trustee, including your
subscription, and used to pay our creditors. If that happens, you will lose your
investment, even if we fail to raise the minimum amount in this
offering. As a result, there is no assurance that your funds will be
returned to you if the minimum offering is not reached. Any funds
received by us thereafter will immediately used by us.
If we do not receive the minimum
amount of $75,000 within 270 days of the effective date of our registration
statement, all funds will be promptly returned to you without interest
and without a deduction of any kind. We will return your
funds to you in the form a cashier’s check sent Federal Express on the 271st
day. During the 270 day period, no funds will be returned to you. You
will only receive a refund of your subscription if we do not raise a minimum of
$75,000 within the 270 day period referred to above. There are no finders
involved in our distribution. You will only have the right to have
your funds returned if we do not raise the minimum amount of the offering or
there would be a change in the material terms of the offering. The
following are material terms that would allow you to be entitled to a refund of
your money:
* extension
of the offering period beyond 270 days;
* change
in the offering price;
* change
in the minimum sales requirement;
* change
to allow sales to affiliates in order to meet the minimum sales
requirement;
*
|
change
in the amount of proceeds necessary to release the proceeds held in the
separate bank account; and,
|
If the changes above occur, any new
offering may be made by means of a post-effective amendment.
We will sell the shares in this
offering through Robert Clarke, our sole officer and director. He
will receive no commission from the sale of any shares. He will not register as
a broker-dealer under section 15 of the Securities Exchange Act of 1934 in
reliance upon Rule 3a4-1. Rule 3a4-1 sets forth those conditions under which a
person associated with an issuer may participate in the offering of the issuer's
securities and not be deemed to be a broker/dealer. The conditions are
that:
1. The person is not
statutorily disqualified, as that term is defined in Section 3(a)(39) of the
Act, at the time of his participation; and,
- 15 -
2. The person is not
compensated in connection with his participation by the payment of commissions
or other remuneration based either directly or indirectly on transactions in
securities;
3. The person is not at the
time of their participation, an associated person of a broker/dealer;
and,
4. The person meets the
conditions of Paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that he
(A) primarily performs, or is intended primarily to perform at the end of the
offering, substantial duties for or on behalf of the Issuer otherwise than in
connection with transactions in securities; and (B) is not a broker or dealer,
or an associated person of a broker or dealer, within the preceding twelve (12)
months; and (C) do not participate in selling and offering of securities for any
Issuer more than once every twelve (12) months other than in reliance on
Paragraphs (a)(4)(i) or (a)(4)(iii).
Robert Clarke is not statutorily
disqualified, is not being compensated, and is not associated with a
broker/dealer. He is and will continue to be our sole officer and director at
the end of the offering and has not been during the last twelve months and is
currently not a broker/dealer or associated with a broker/dealer. He
will not participate in selling and offering securities for any issuer more than
once every twelve months.
Only after our registration statement
is declared effective by the SEC, do we intend to advertise, through tombstones,
and hold investment meetings in various states where the offering will be
registered. We will not utilize the Internet to advertise our offering. Mr.
Clarke will also distribute the prospectus to potential investors at the
meetings, to business associates and to his friends and relatives who are
interested in us and a possible investment in the offering. No shares purchased
in this offering will be subject to any kind of lock-up agreement.
Management and affiliates thereof will
not purchase shares in this offering to reach the minimum.
We intend to sell our shares in the
states of Wyoming and Colorado, or outside the United States.
Section
15(g) of the Exchange Act
Our shares are covered by Section 15(g)
of the Securities Exchange Act of 1934, as amended, and Rules 15g-1 through
15g-6 and Rule 15g-9 promulgated thereunder. They impose additional sales
practice requirements on broker/dealers who sell our securities to persons other
than established customers and accredited investors (generally institutions with
assets in excess of $5,000,000 or individuals with net worth in excess of
$1,000,000 or annual income exceeding $150,000 or $300,000 jointly with their
spouses). While Section 15(g) and Rules 15g-1 through 15g-6 apply to
brokers-dealers, they do not apply to us.
Rule 15g-1 exempts a number of specific
transactions from the scope of the penny stock rules.
Rule
15g-2 declares unlawful broker/dealer transactions in penny stocks unless the
broker/dealer has first provided to the customer a standardized disclosure
document.
Rule 15g-3 provides that it is unlawful
for a broker/dealer to engage in a penny stock transaction unless the
broker/dealer first discloses and subsequently confirms to the customer current
quotation prices or similar market information concerning the penny stock in
question.
- 16 -
Rule 15g-4 prohibits broker/dealers
from completing penny stock transactions for a customer unless the broker/dealer
first discloses to the customer the amount of compensation or other remuneration
received as a result of the penny stock transaction.
Rule 15g-5 requires that a
broker/dealer executing a penny stock transaction, other than one exempt under
Rule 15g-1, disclose to its customer, at the time of or prior to the
transaction, information about the sales persons compensation.
Rule 15g-6 requires broker/dealers
selling penny stocks to provide their customers with monthly account
statements.
Rule 15g-9 requires broker/dealers to
approved the transaction for the customer's account; obtain a written agreement
from the customer setting forth the identity and quantity of the stock being
purchased; obtain from the customer information regarding his investment
experience; make a determination that the investment is suitable for the
investor; deliver to the customer a written statement for the basis for the
suitability determination; notify the customer of his rights and remedies in
cases of fraud in penny stock transactions; and, the NASD's toll free telephone
number and the central number of the North American Administrators Association,
for information on the disciplinary history of broker/dealers and their
associated persons. Because the penny stock rules impose additional
obligations on broker/dealers, many broker/dealers are unwilling to buy or sell
penny stock s or open accounts for customers who wish to buyer or sell penny
stock. As a result the penny
stock rules may affect your ability to resell your
shares.
Offering
Period and Expiration Date
This offering will start on the date of
this prospectus and continue for a period of up to 270 days.
Procedures
for Subscribing
If you decide to subscribe for any
shares in this offering, you must
1. execute
and deliver a subscription agreement; and
2. deliver
a check or certified funds to us for acceptance or rejection.
All checks for subscriptions must be
made payable to MONAR INTERNATIONAL INC.
Right
to Reject Subscriptions
We have the right to accept or reject
subscriptions in whole or in part, for any reason or for no reason. All monies
from rejected subscriptions will be returned immediately by us to the
subscriber, without interest or deductions. Subscriptions for securities will be
accepted or rejected within 48 hours after we receive them.
- 17 -
MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This section of the prospectus includes
a number of forward-looking statements that reflect our current views with
respect to future events and financial performance. Forward-looking
statements are often identified by words like: believe, expect, estimate,
anticipate, intend, project and similar expressions, or words which, by their
nature, refer to future events. You should not place undue certainty
on these forward-looking statements, which apply only as of the date of this
prospectus. These forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or our predictions.
We are a start-up stage corporation and
have not started operations or generated or realized any revenues from our
business operations.
Our auditors have issued a going
concern opinion. This means that our auditors believe there is
substantial doubt that we can continue as an on-going business for the next
twelve months unless we obtain additional capital to pay our
bills. This is because we have not generated any revenues and no
revenues are anticipated until we complete the development of our website,
locate suppliers of products, and sell products to our
customers. We have
spent nominal time designing the website. We intend to retain the
services of a website developer to create the
website. Accordingly, we must raise cash from sources
other than operations. Our only other source for cash at this time is
investments by others in our company. We must raise cash to implement
our project and begin our operations. Even if we raise the maximum
amount of money in this offering, we do not know how long the money will last,
however, we do believe it will last twelve months. We will not begin
operations until we raise money from this offering.
To meet our need for cash we are
attempting to raise money from this offering. We believe that we will
be able to raise enough money through this offering to maintain operations for
twelve months, but we cannot guarantee that once we begin operations we will
stay in business after twelve months. If we are unable to secure
enough suppliers of products at suitably low pricing or enough customers willing
to buy the products at higher than the price we have negotiated with our
suppliers, we may quickly use up the proceeds from the minimum amount of money
from this offering and will need to find alternative sources, like a second
public offering, a private placement of securities, or loans from our officers
or others in order for us to maintain our operations. At the present
time, we have not made any arrangements to raise additional cash, other than
through this offering. If we need additional cash and cannot raise it
we will either have to suspend operations until we do raise the cash, or cease
operations entirely. If we raise the minimum amount of money from
this offering, it will last a year but with limited funds available to develop
growth strategy. If we raise the maximum amount, we believe the
money will last a year and also provide funds for growth strategy.
If we raise less than the maximum
amount and we need more money we will have to revert to obtaining additional
money as described in this paragraph. Other than as described
in this paragraph, we have no other financing plans.
- 18 -
Plan
of Operation
Upon completion of our public offering,
our specific goal is to profitably sell products on our Internet website to the
public. We intend to accomplish the foregoing by the following
steps.
1. Complete
our public offering. We believe that we will raise sufficient capital
to begin our operations. We believe this could take up to 270
days. We will not begin operations until we have closed this
offering. We intend to concentrate all of our efforts on raising as
much capital as we can during this period. After we complete our public offering, we intend to
spend the funds as described in the Use of Proceeds section of this
prospectus.
2. After
completing the offering, we will immediately begin to establish our office and
acquire the equipment we need to begin operations. Establishing our
offices will take approximately a week. We have allocated $10,000 for
the initial setup of the office. We do not intend to hire employees unless we raise at least $100,000.00. Our sole officer and director will handle
our administrative duties.
3. We have spent nominal time
designing the website . We plan to retain a website
developer create a state of the art website to promote our
products. We expect to spend $5,000 to $10,000 for the website which
will include graphics and links from our site. We intend to locate
smaller, new manufacturers to offer their products on a more exclusive
basis.
4. Marketing
and advertising will be focused on promoting our website and
products. The advertising campaign may also include the design and
printing of various sales materials. We intend to market our website
through traditional sources such as advertising in magazines, billboards,
telephone directories and preparing and sending out flyers and mailers both
through the regular mail and via email. Advertising and promotion
will be an ongoing effort but the initial cost of developing the campaign is
estimated to cost between $15,000 to $35,000.
5. Once
the website is fully functional and we have located and negotiated agreements
with a suitable number of suppliers to offer their products for sale, we intend
to hire 1 or 2 part-time salesperson(s) to fill Internet orders from
customers.
We anticipate that we will generate
revenues as soon as we are able to offer products for sale on our
website. This will happen once we negotiated agreements with one or
two suppliers of products.
We will not be conducting any
research. We are not going to buy or sell any plant or significant
equipment during the next twelve months.
If we cannot generate sufficient
revenues to continue operations, we will suspend or cease
operations. If we cease operations, we do not know what we will do
and we do not have any plans to do anything.
- 19 -
Limited
operating history; need for additional capital
There is no historical financial
information about us upon which to base an evaluation of our
performance. We are in a start-up stage operations and have not
generated any revenues. We cannot guarantee we will be successful in
our business operations. Our business is subject to risks inherent in
the establishment of a new business enterprise, including limited capital
resources and possible cost overruns due to price and cost increases in services
and products.
To become profitable and competitive,
we have to locate and negotiate agreements with manufacturers to offer their
products for sale to us at pricing that will enable us to establish and sell the
products to our clientele at a profit. We are seeking equity
financing to provide for the capital required to implement our
operations.
We have no assurance that future
financing will be available to us on acceptable terms. If financing
is not available on satisfactory terms, we may be unable to continue, develop or
expand our operations. Equity financing could result in additional
dilution to existing shareholders.
Results
of operations
From
Inception on July 6, 2009 to July 31, 2009
During the period we incorporated the
company, hired the attorney, and hired the auditor for the preparation of this
registration statement. We have prepared an internal business
plan. We have reserved the domain name “www.monarinternational.com”
and commenced construction of our web site. Our loss since inception is $16,588
of which $15,000 is for legal fees, $0 for audit fees, $1,000 for professional
services and $588 is for filing fees and general office costs. We
have not started our proposed business operations and will not do so until we
have completed this offering. We expect to begin operations 100 days after we
complete this offering.
Since inception, we sold 5,000,000
shares of common stock to our sole officer and director for $50.
Liquidity
and capital resources
As of the date of this prospectus, we
have yet to generate any revenues from our business operations.
We issued 5,000,000 shares of common
stock pursuant to the exemption from registration contained in Regulation S of
the Securities Act of 1933. This was accounted for as a sale of
common stock.
As of July 31, 2009, our total assets
were $2,230 and our total liabilities were $18,768 comprising of $17,768 owning
to Robert Clarke, our sole officer and director for payments made to our
attorney for the incorporation of the company, payment made to auditor and $500
owing for filing fees to the Secretary of State. As of July 31, 2009,
we had cash of $Nil.
- 20 -
BUSINESS
General
We were incorporated in the State of
Nevada on July 6, 2009. We will develop a website (www.monarinternational.com)
that will offer to the public a tasteful traditional style Chinese furniture
adapted to modern needs for Asian ethnic and high end markets in North
America. We have
spent nominal time designing the website. We intend to retain the
services of a website developer to create the website. We have not generated any revenues and the only
operations we have engaged in is planning our website and the development of a
business plan.
We have no plans to change our business
activities or to combine with another business, and we are not aware of any
events or circumstances that might cause its plans to change.
We have not begun operations and will
not begin operations until we completed this offering. Our plan of
operation is forward looking and there is no assurance that we will ever begin
operations. Our prospects for profitability are not favorable if you
consider numerous Internet-based companies have failed to achieve profits with
similar plans.
Products
Our principal business objective is to
offer traditional style Chinese furniture adapted to modern needs for Asian
ethnic and high end markets in North America. It is the opinion of
our sole officer and director that our target market and likely purchaser of our
products will primarily be individuals with higher than average income who are
seeking an Asian flavor in their home décor.
The products we intend to promote will
be selected by our sole officer and director, Robert Clarke.
Website
We have spent nominal time
designing the website. We intend to retain the services of a website
developer to create the website. We intend to create
and maintain a website which will provide the following services and products
for the website: disk space, bandwidth, 155 mbit backbone, pop mailboxes, e-mail
forwarding, e-mailing aliasing, auto responder, front page support, unlimited
FTP access, java chat, hotmetal/miva script, shopping cart, secure transactions
signio support, cybercash support and macromedia flash. The foregoing
will allow us to make retail sales of furniture products, promote our products
in an effective manner, and communicate with our customers on-line.
The website is intended to be a
destination site for retail buyers of traditional Chinese
furniture. We intend to source out a large network of suppliers all
related to the furniture business so that furniture buyers and home designers
will be able to buy all of their products from our website. The site
will offer a large array of products and by becoming a “one-stop shopping”
destination will significantly enhance the efficiency of the purchasing process
simultaneously reducing the time and cost of finding reasonably priced
products. We intend to continually source out and negotiate
strategic
- 21 -
relationships
with individual suppliers and manufacturers to offer their products on our
website. We intend to negotiate favorable pricing from the
manufacturers in exchange for offering them direct access to the database of
potential buyers that we intend to develop and maintain through our marketing
program.
Date Base
We intend to develop and maintain a database of all
current customers and suppliers. It will include the customer’s name,
address, telephone number, item purchased and additional information we hope to
obtain through the use of a questionnaire. The size of the
questionnaire is dependent upon how much we raise. The questionnaire
will ask questions related to the customer’s furniture likes and dislikes, and
shopping experiences. The more information that we can obtain from a
customer, the more we can know the customer and the more information we will
have in order adjust our marketing and sales programs. The cost of
the data base is relative to the amount of information we acquire and our
ability to analyze the information. The same applies to the
suppliers. Suppliers will be interested in the feedback we receive
from our customers. It should give suppliers feedback on their
furniture.
We also believe that the lack of
financial security on the Internet is hindering economic activity thereon. To
ensure the security of transactions occurring over the Internet, U.S. federal
regulations require that any computer software used within the United States
contain a 128-bit encoding encryption, while any computer software exported to a
foreign country contain a 40-bit encoding encryption. There is uncertainty as to
whether the 128-bit encoding encryption required by the U.S. is sufficient
security for transactions occurring over the Internet. Accordingly, there is a
danger that any financial (credit card) transaction via the Internet will not be
a secure transaction. Accordingly, risks such as the loss of data or loss of
service on the Internet from technical failure or criminal acts are now being
considered in the system specifications and in the security precautions in the
development of the website. There is no assurance that such security precautions
will be successful.
Other than investigating potential
technologies in support of our business purpose, we have had no material
business operations since inception in July 2009. At present, we have yet to acquire
or develop the necessary technology assets in support of our business purpose to
become a Internet-based retailer focused on the distribution of furniture.
The Internet is a world-wide medium of
interconnected electronic and/or computer networks. Individuals and companies
have recently recognized that the communication capabilities of the Internet
provide a medium for not only the promotion and communication of ideas and
concepts, but also for the presentation and sale of information, goods and
services.
Convenient
Shopping Experience
Our online store will provide customers
with an easy-to-use Web site. The website will be available 24 hours a day,
seven days a week and will be reached from the shopper's home or office. Our
online store will enable us to deliver a broad selection of products to
customers in rural or other locations that do not have convenient access to
physical stores. We also intend to make the shopping experience
convenient by categorizing our products into easy-to-shop
departments.
- 22 -
Customer Service
We intend to provide a customer service
department via email where consumers can resolve order and product questions.
Furthermore, we will insure consumer satisfaction by offering a money back
guarantee.
Online
Retail Store
We intend to design our Internet store
to be a place for individual consumers to purchase our line of
products.
Shopping
at our Online Store
Our online store will be located at
www.monarinternational.com. We believe that the sale of furniture on
the Internet can offer attractive benefits to consumers. These
include enhanced selection, convenience, quality, ease-of-use, depth of content
and information and competitive pricing. Key features of our online
store will include:
Browsing
Our online store will offer consumers
several subject areas and special features arranged in a simple, easy-to-use
format intended to enhance product selection. By clicking on a
category names, the consumer will move directly to the home page of the desired
category and can view promotions and featured products.
Selecting a Product and Checking
Out
To purchase products, consumers will
simply click on the “add to cart” button to add products to their virtual
shopping cart. Consumers will be able to add and subtract products from their
shopping cart as they browse around our online store prior to making a final
purchase decision, just as in a physical store. To execute orders,
consumers click on the “checkout” button and, depending upon whether the
consumer has previously shopped at our online store, are prompted to supply
shipping details online. We will also offer consumers a variety of wrapping and
shipping options during the checkout process. Prior to finalizing an order by
clicking the “submit” button, consumers will be shown their total
charges along with the various options chosen at which point consumers still
have the ability to change their order or cancel it entirely.
Paying
To pay for orders, a consumer must use
a credit card, which is authorized during the checkout
process. Charges are assessed against the card when the order is
placed. Our online store will use a security technology that works
with the most common Internet. We will be using 128-bit encoding encryption required by
the U.S. for transactions occurring over the Internet. As mentioned
previously, there is a danger that any financial (credit card) transaction via
the Internet will not be a secure transaction.
We intend to pass on to our customer any warranties that
suppliers make to us.
- 23 -
Source
of Products
We intend to purchase products from
manufacturers and distributors of furniture located on the Asian continent,
primarily China. A portion of the purchase price, between 40% and
70%, depending on the prices we negotiate with the manufacturer, is used to
acquire the product from the manufacturer or distributor. Mark-ups on new
products will range from 15% to 200%. The mark-up will be comparable with our
competitors. We will take each product on a case by case basis.
The product will be shipped directly from
the manufacturer to the customer, thereby eliminating the need for storage space
or packaging facilities.
We intend to source out and negotiate
with manufacturers and distributors to offer their products for sale on our
website either directly or via a direct link to their websites. In
addition, we intend to locate and negotiate relationships with some
manufacturers and distributors to offer their products on a more exclusive
basis. We have
indentified three potential suppliers however, we have not entered into any
agreements with the suppliers until such time as we successfully complete our
public offering.
Revenue
We intend to generate revenue from four
sources on the website:
-
|
Revenues
will be generated from the direct sale of products to
customers. We will order products on behalf of our customers
directly from our suppliers. At the time we are receiving an
order from a customer, we will order the product from the
supplier. That way we avoid having to carry any inventory that
can be costly and become obsolete. We would earn revenue based
on the difference between our negotiated price for the product with our
suppliers and the price that the customer
pays;
|
-
|
Revenues
will be generated by fees received for sales that originate from our
website and are linked to those manufacturers that we will negotiate
relationships with. Our customers would link to the
manufacturer’s website directly from our site and we would be paid a fee
for directing the traffic that result in
sales;
|
-
|
We
plan to offer banner advertising on our website for new manufacturers
hoping to launch new products;
|
-
|
Finally,
we plan to earn revenues for special promotions to enable manufacturers to
launch new products - we would sell “premium shelf space” on our
website. Premium shelf space will be eye appealing
advertising space which will appear on the initial webpage of our Internet
site.
|
We also intend to develop and launch an
advertising campaign to introduce our website to potential
customers.
- 24 -
Competition
The electronic commerce market is
intensely competitive. We expect competition to continue to intensify
in the future. Competitors include companies with substantial
customer bases in the computer and other technical fields. There can be no
assurance that we can maintain a competitive position against current or future
competitors, particularly those with greater financial, marketing, service,
support, technical and other resources. Our failure to maintain a
competitive position within the market could have a material adverse effect on
our business, financial condition and results of operations. There can be no
assurance that we will be able to compete successfully against current and
future competitors, and competitive pressures faced by us may have a material
adverse effect on our business, financial condition and results of
operations.
There
are many companies offering the same services as we intend to
offer. Upon initiating our website operations, we will be competing
with the foregoing.
Our industry is fragmented and
regionalized. In China, there are many Internet companies offering not
only furniture on the Internet, but other products as well. Most of
these companies are small boutique operations such as ours. They are
most prevalent in Hong Kong and Shanghi. Our competitive position within the
industry is negligible in light of the fact that we have not started our
operations. Older, well established distributors of the products we
intend to offer with records of success will attract qualified
customers away from us. Since we have not started
operations, we cannot compete with them on the basis of
reputation. We do expect to compete with them on the basis of price
and services in that we intend to be able to attract and
retain customers by offering a breadth of tasteful product selection through our
relationships with manufacturers and suppliers ; offer attractive, competitive
pricing ;
and , will be responsive to all our customers’
needs. We intend to offer the manufacturers’ access to our data base
of customers that we hope to develop through our marketing and advertising
campaign .
Marketing
We intend to market our website in the
United States through traditional sources such as trade magazines, conventions
and conferences, newspapers advertising, billboards, telephone directories and
flyers/mailers. We may utilize inbound links that connect directly to
our website from other sites. Potential customers can simply click on these
links to become connected to our website from search engines and community and
affinity sites.
Insurance
We do not maintain any insurance and do
not intend to maintain insurance in the future. Because we do not
have any insurance, if we are made a party of a products liability action, we
may not have sufficient funds to defend the litigation. If that
occurs a judgment could be rendered against us, which could cause us to cease
operations.
Employees;
Identification of Certain Significant Employees.
We are a development stage company and
currently have no employees, other than our sole officer and
director. We intend to hire additional employees on an as needed
basis.
- 25 -
Offices
Our principal executive office is
located at Suite 1320, Sino Favour Centre, 1 On Yip Street, Chaiwan, Hong Kong,
China. Our telephone number is 852-9738-1945 and our registered agent
for service of process is the National Registered Agents Inc. of NV, located at
1000 East William Street, Suite 204, Carson City, Nevada 89701. Our
office is located in Chaiwan, a light industrial district in the east end of
Hong Kong Island, in offices occupied by several companies to which our
president, Robert Clarke, has provided consulting services to in the
past. We use approximately 100 square feet of space in location on a
rent free basis for three months commencing August 1, 2009. As at
November 2009, we will incur a monthly cost of approximately
$65.00. The term
of the lease is until October 31, 2010. The office space is
currently adequate for our needs. If we grow and more space is
required, we intend to move our operations or rent additional space to
supplement our existing facility.
Government
Regulation
We are not currently subject to direct
federal, state or local regulation other than regulations applicable to
businesses generally or directly applicable to electronic
commerce. However, the Internet is increasingly
popular. As a result, it is possible that a number of laws and
regulations may be adopted with respect to the Internet. These laws
may cover issues such as user privacy, freedom of expression, pricing, content
and quality of products and services, taxation, advertising, intellectual
property rights and information security. Furthermore, the growth of
electronic commerce may prompt calls for more stringent consumer protection
laws. Several states have proposed legislation to limit the uses of personal
user information gathered online or require online services to establish privacy
policies. The Federal Trade Commission has also initiated action
against at least one online service regarding the manner in which personal
information is collected from users and provided to third parties. We
will not provide personal information regarding our users to third parties.
However, the adoption of such consumer protection laws could create uncertainty
in Web usage and reduce the demand for our products.
We not certain how business may be
affected by the application of existing laws governing issues such as property
ownership, copyrights, encryption and other intellectual property issues,
taxation, libel, obscenity and export or import matters. The vast
majority of such laws were adopted prior to the advent of the
Internet. As a result, they do not contemplate or address the unique
issues of the Internet and related technologies. Changes in laws
intended to address such issues could create uncertainty in the Internet market
place. Such uncertainty could reduce demand for services or increase the cost of
doing business as a result of litigation costs or increased service delivery
costs.
In addition, because our products are
available over the Internet in multiple states and foreign countries, other
jurisdictions may claim that we are required to qualify to do business in each
such state or foreign country. We are qualified to do business only
in Nevada. Our failure to qualify in a jurisdiction where it is
required to do so could subject it to taxes and penalties. It could
also hamper our ability to enforce contracts in such
jurisdictions. Currently, we are qualified to do business in Nevada and
will be qualified to do business in Hong Kong prior to commencing
operations. Other than Nevada and Hong Kong, we do not believe we
will have to qualify to do business in any other
jurisdiction.
In Nevada, we are required to pay an annual fee to the
Nevada Secretary of State of $165.00. Nevada has no corporate income
taxes. That is why it is so attractive to do business
there .
- 26 -
Other than the foregoing, no governmental approval is
needed for the sale of our products in the United States or the State of
Nevada .
Every foreign corporation doing
business in Hong Kong must register as a foreign company under Part XI of the
Companies Ordinance (Cap. 32) and within 30 days of beginning operation register
the business under the provisions of Business Registrations Oridiance (Cap.
310). The total cost of the registration is approximately $250.00
which will be paid from working capital following the completion of this public
offering .
Income tax in Hong Kong is called a
“profit tax”. We will be subject to the profit tax of approximately
16% and is predicated on gross profits .
The contracts we enter into with
suppliers will not affect our business .
MANAGEMENT
Officer
and director
Our sole director will serve until his
successor is elected and qualified. Our sole officer is elected by the board of
directors to a term of one (1) year and serves until his or his successor is
duly elected and qualified, or until he or she is removed from office. The board
of directors has no nominating, auditing or compensation
committees.
The name, address, age and position of
our present officer and director are set forth below:
Name
and Address
|
Age
|
Position(s)
|
Robert
Clarke
|
65
|
president,
principal executive officer, secretary,
|
Suite
1302, Sino Favour Centre
|
treasurer,
principal financial officer, principal
|
|
1
On Yip Street
|
accounting
officer and sole member of the board of
|
|
Chaiwan,
Hong Kong,
|
directors.
|
|
China
|
The person named above has held his
offices/positions since inception of our company and are expected to hold his
offices/positions until the next annual meeting of our
stockholders.
Background of officer and
director
Since our inception on July 6, 2009,
Robert Clarke has been our president, principal executive officer, secretary,
treasurer, principal financial officer, principal accounting officer and sole
member of the board of directors. From July 2008 to June 2009, Mr.
Clarke was Chairman and a Director of Ecolocap Solutions Inc., a Nevada
corporation located in Montreal, Quebec. Ecolocap is engaged in the
business of providing services and products related to the reduction of
greenhouse gases. Ecolocap’s common stock is traded on the Bulletin
Board operated by the Financial Industry Regulatory Authority (FINRA) under the
symbol ECOS. From
July 15, 2008 to June 19, 2009, Mr. Clarke was a member of the Board of
Directors of Tiger Renewable Energy, Ltd., and
from
- 27 -
September 12, 2008 to June 4, 2009 was President and
CEO. Tiger Renewable Energy, Ltd is a Nevada corporation with its
principal place of business located in Pointe-Claire, Quebec, Canada H9R 4S2 and
is currently a blank check company. After Mr. Clarke resigned, Tiger
Renewable Energy, Ltd changed its name to Cono Italiano,
Inc. Currently it is traded on the Bulletin Board under the symbol
CNOZ. Since June 2000, Mr. Clarke has been Chairman and
Chief Executive Officer of 7bridge Capital Partners, a private venture capital
group in Hong Kong. Prior to moving to Hong Kong Mr. Clarke was based in
Vancouver, BC and played a key role in the start-up and financing of several
Canadian and United States companies in the high technology and
telecommunications sectors. Since mid 2001 he has been based in Hong Kong and
involved in private and public companies, with a particular emphasis on the
development of China opportunities. Prior to moving to Hong Kong in June 2001,
Mr. Clarke served as a Director and as President and Chief Executive Officer of
Waverider Communications Inc. from January 1997 to December 1997. He was a
Director and Chairman of TEK Digitel Corp. from June 1998 until September 1999.
Mr. Clarke also served as the Chairman of the Board of Directors of ePhone
Telecom Inc. from April 1999 until July 21, 2000 when he resigned from the
Board. He rejoined the Board on December 1, 2000 once again becoming Chairman,
which position he held until September 12, 2002. He resigned from the ePhone
Board on December 30, 2002. He also served as the Chief Executive Officer of
ePhone from June 3, 1999 to July 21, 2000 and again from December 1, 2000 to
July 1, 2002. For three periods: June 3, 1999 to August 8, 1999; March 9, 2000
to April 1, 2000; and December 1, 2000 to April 1, 2001 he also served as
President. Mr. Clarke has also been Director and Chairman of the Board of
Directors of Manaris Corporation (formerly C-Chip Technologies Corporation) from
January 2003 to August 23, 2006 on which date resigned as both Chairman and a
director. Mr. Clarke
has also been Chairman of Cardtrend International Inc. (now known as Mezabay
International Inc.) since Oct. 2, 1998, except for a period from Dec. 17, 2004
to Oct. 5, 2005, until resigning in January 2008. He also served a Chief
Executive Officer of Cardtrend (then called Asia Payment Systems Inc.) from Oct.
15, 2005 until May 22, 2006. Cardtrend International Inc. is now known as
Mezabay International Inc.
During the past five years, Mr. Clarke
has not been the subject of the following events:
1. Any bankruptcy petition filed by or
against any business of which Mr. Clarke was a general partner or executive
officer either at the time of the bankruptcy or within two years prior to that
time.
2. Any conviction in a criminal
proceeding or being subject to a pending criminal proceeding.
3. An order, judgment, or decree, not
subsequently reversed, suspended or vacated, or any court of competent
jurisdiction, permanently or temporarily enjoining, barring, suspending or
otherwise limiting Mr. Clarke’s involvement in any type of business, securities
or banking activities.
4. Found by a court of competent
jurisdiction (in a civil action), the Securities and Exchange Commission or the
Commodity Future Trading Commission to have violated a federal or state
securities or commodities law, and the judgment has not been reversed, suspended
or vacated.
Audit
Committee Financial Expert
We do not have an audit committee
financial expert. We do not have an audit committee financial expert
because we believe the cost related to retaining a financial expert at this time
is prohibitive. Further, because we have no operations, at the
present time, we believe the services of a financial expert are not
warranted.
- 28 -
Conflicts of
Interest
The only conflict that we foresee are
that our sole officer and director will devote time to projects that do not
involve us.
EXECUTIVE
COMPENSATION
The following table sets forth the
compensation paid by us for the last three fiscal years ending July 31, 2009 for
each or our officers. This information includes the dollar value of base
salaries, bonus awards and number of stock options granted, and certain other
compensation, if any. The compensation discussed addresses all
compensation awarded to, earned by, or paid or named executive
officers.
Executive
Officer Compensation Table
Non-
|
Nonqualified
|
||||||||
Equity
|
Deferred
|
All
|
|||||||
Name
|
Incentive
|
Compensa-
|
Other
|
||||||
and
|
Stock
|
Option
|
Plan
|
tion
|
Compen-
|
||||
Principal
|
Salary
|
Bonus
|
Awards
|
Awards
|
Compensation
|
Earnings
|
sation
|
Total
|
|
Position
|
Year
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
Robert
Clarke
|
2009
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
President
|
2008
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
2007
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
We have no employment agreements with
any of our officers. We do not contemplate entering into any employment
agreements until such time as we begin profitable operations.
The compensation discussed herein
addresses all compensation awarded to, earned by, or paid to our named executive
officers.
There are no other stock option plans,
retirement, pension, or profit sharing plans for the benefit of our sole officer
and director other than as described herein.
Compensation
of Directors
The member of our board of directors is
not compensated for his services as a director. The board has not implemented a
plan to award options to any directors. There are no contractual arrangements
with any member of the board of directors. We have no director’s service
contracts. The following table sets forth compensation paid to our
sole director from inception on July 6, 2009 to our year end on July 31,
2009. Since that time we have not paid any compensation to Mr. Clarke
either as an executive officer or as a director.
- 29 -
Director’s
Compensation Table
Fees
|
|||||||
Earned
|
Nonqualified
|
||||||
or
|
Non-Equity
|
Deferred
|
|||||
Paid
in
|
Stock
|
Option
|
Incentive
Plan
|
Compensation
|
All
Other
|
||
Cash
|
Awards
|
Awards
|
Compensation
|
Earnings
|
Compensation
|
Total
|
|
Name
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(US$)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
Robert
Clarke
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Long-Term
Incentive Plan Awards
We do not have any long-term incentive
plans that provide compensation intended to serve as incentive for
performance.
Indemnification
Under our Articles of Incorporation and
Bylaws of the corporation, we may indemnify an officer or director who is made a
party to any proceeding, including a lawsuit, because of his position, if he
acted in good faith and in a manner he reasonably believed to be in our best
interest. We may advance expenses incurred in defending a proceeding. To the
extent that the officer or director is successful on the merits in a proceeding
as to which he is to be indemnified, we must indemnify him against all expenses
incurred, including attorney's fees. With respect to a derivative action,
indemnity may be made only for expenses actually and reasonably incurred in
defending the proceeding, and if the officer or director is judged liable, only
by a court order. The indemnification is intended to be to the fullest extent
permitted by the laws of the State of Nevada.
Regarding indemnification for
liabilities arising under the Securities Act of 1933, which may be permitted to
directors or officers under Nevada law, we are informed that, in the opinion of
the Securities and Exchange Commission, indemnification is against public
policy, as expressed in the Act and is, therefore, unenforceable.
PRINCIPAL
STOCKHOLDERS
The following table sets forth, as of
the date of this prospectus, the total number of shares owned beneficially by
our directors, officers and key employees, individually and as a group, and the
present owners of 5% or more of our total outstanding shares. The table also
reflects what their ownership will be assuming completion of the sale of all
shares in this offering. The stockholders listed below have direct ownership of
their shares and possesses sole voting and dispositive power with respect to the
shares.
- 30 -
Number of Shares
|
||||
Outstanding After
|
Percentage of
|
|||
the Offering
|
Ownership After
|
|||
including 5,000,000
|
the Offering
|
|||
Number of
|
shares owned by
|
including
5,000,000
|
||
Shares
|
Percentage of
|
Robert Clarke
|
shares owned by
|
|
Outstanding
|
Ownership
|
Assuming all of
|
Robert Clarke
|
|
Name and Address
|
Before
|
Before the
|
the Shares are
|
Assuming all of
the
|
Beneficial Owner [1]
|
the Offering
|
Offering
|
Sold
|
Shares are Sold
|
Robert Clarke
|
5,000,000
|
100%
|
6,500,000
|
76.29%
|
Suite 1302, Sino Favour
Centre
|
||||
1 On Yip Street
|
||||
Chaiwan, Hong Kong,
|
||||
China
|
[1]
|
The
person named above may be deemed to be a “parent” and “promoter” of our
company, within the meaning of such terms under the Securities Act of
1933, as amended, by virtue of his/its direct and indirect stock holdings.
Mr. Clarke is the only “promoter” of our
company.
|
Future sales by existing
stockholders
A total of 5,000,000 shares of common
stock were issued to our sole officer and director, all of which are restricted
securities, as defined in Rule 144 of the Rules and Regulations of the SEC
promulgated under the Securities Act. Under Rule 144, the shares can be publicly
sold by affiliates, subject to volume restrictions and restrictions on the
manner of sale, commencing six months after their acquisition, provided the
Company was not a shell company when the shares were issued or prior
thereto. A shell company is a corporation with
no or nominal assets or its assets consist solely of cash and no or nominal
operations, however, as set forth in SEC Release 33-8869, note 172, the SEC did
not intend to capture “start-up” companies within the term “shell company”. We
believe that we are a start-up company and accordingly are not classified
as a shell company. If it is determined as a matter of law
that we are a shell company and we are not in the start-up phase of operation,
then Mr. Clarke will not be able to resell his shares of common stock under Rule
144 .
Shares purchased in this offering,
which will be immediately resalable. The resale of shares could have a
depressive effect on the market price should a market develop for our common
stock. There is no assurance a market will ever develop for our
common stock.
There is no public trading market for
our common stock. There are no outstanding options or warrants to purchase, or
securities convertible into, our common stock. There is one holder of record for
our common stock. The record holder is our sole officer and director, who owns
5,000,000 restricted shares of our common stock.
- 31 -
DESCRIPTION OF
SECURITIES
Common
Stock
Our authorized capital stock consists
of 100,000,000 shares of common stock, par value $0.00001 per share. The holders
of our common stock:
* have
equal ratable rights to dividends;
|
*
|
are
entitled to share ratably in all of our assets available for distribution
to holders of common stock upon liquidation, dissolution or winding up of
our affairs;
|
|
*
|
do
not have preemptive, subscription or conversion rights and there are no
redemption or sinking fund provisions or rights;
and
|
|
*
|
are
entitled to one non-cumulative vote per share on all matters on which
stockholders may vote.
|
We refer you to our Articles of
Incorporation, Bylaws and the applicable statutes of the State of Nevada for a
more complete description of the rights and liabilities of holders of our
securities.
Non-cumulative
voting
Holders of shares of our common stock
do not have cumulative voting rights, which means that the holders of more than
50% of the outstanding shares, voting for the election of directors, can elect
all of the directors to be elected, if they so choose, and, in that event, the
holders of the remaining shares will not be able to elect any of our directors.
After this offering is completed, assuming the sale of all of the shares of
common stock, Robert Clarke, our sole officer and directors, will own
approximately 76.29% of our outstanding shares.
Cash
dividends
As of the date of this prospectus, we
have not paid any cash dividends to stockholders. The declaration of any future
cash dividend will be at the discretion of our board of directors and will
depend upon our earnings, if any, our capital requirements and financial
position, our general economic conditions, and other pertinent conditions. It is
our present intention not to pay any cash dividends in the foreseeable future,
but rather to reinvest earnings, if any, in our business
operations.
Preferred
Stock
We are authorized to issue 100,000,000
shares of preferred stock with a par value of $0.00001 per share. The terms of
the preferred shares are at the discretion of the board of directors. Currently
no preferred shares are issued and outstanding.
Anti-takeover
provisions
There are no Nevada anti-takeover
provisions that may have the affect of delaying or preventing a change in
control.
- 32 -
Reports
After we complete this offering, we
will not be required to furnish you with an annual report. Further, we will not
voluntarily send you an annual report. We will be required to file reports with
the SEC under section 15(d) of the Securities Act. The reports will be filed
electronically. The reports we will be required to file are Forms 10-K, 10-Q,
and 8-K. You may read copies of any materials we file with the SEC at the SEC’s
Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may
obtain information on the operation of the Public Reference Room by calling the
SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that will contain
copies of the reports we file electronically. The address for the Internet site
is www.sec.gov.
Stock
transfer agent
Our stock transfer agent for our
securities will be Pacific Stock Transfer Company, 500 East Warm Springs Road,
Suite 240, Las Vegas, Nevada 89119. Its telephone number is (702)
361-3033.
CERTAIN
TRANSACTIONS
On July 6, 2009, we issued a total of
5,000,000 shares of restricted common stock to Robert Clarke, our sole officer
and director in consideration of $50.
Further, Mr. Clarke has advanced funds
to us for our legal, audit, filing fees, general office administration and cash
needs. As of July 31, 2009, Mr. Clarke advanced us
$17,768. Mr. Clarke will not be repaid from the proceeds of this
offering. There is no due date for the repayment of the funds
advanced by Mr. Clarke. Mr. Clarke will be repaid from revenues of
operations if and when we generate revenues to pay the
obligation. There is no assurance that we will ever generate revenues
from our operations. The obligation to Mr. Clarke does not bear
interest. There is no written agreement evidencing the advancement of
funds by Mr. Clarke or the repayment of the funds to Mr. Clarke. The
entire transaction was oral.
LITIGATION
We are not a party to any pending
litigation and none is contemplated or threatened.
EXPERTS
Our financial statements for the period
from inception to July 31, 2009, included in this prospectus have been audited
by Malone & Bailey, P.C., Independent Public Accountants, 10350 Richmond
Avenue, Suite 800, Houston, Texas 77042, telephone (713) 343-4200 as set forth
in their report included in this prospectus. Their report is given upon their
authority as experts in accounting and auditing.
- 33 -
LEGAL MATTERS
The Law Office of Conrad C. Lysiak,
P.S. 601 West First Avenue, Suite 903, Spokane, Washington 99201, telephone
(509) 624-1475 passed on the legality of the shares being offered in this
prospectus.
FINANCIAL
STATEMENTS
Our fiscal year end is July 31. We will
provide audited financial statements to our stockholders on an annual basis; the
statements will be prepared by a firm of Chartered Accountants.
Our financial statements from inception
to July 31, 2009 (audited), immediately follow:
Report
of Independent Registered Public Accounting Firm
|
F-1
|
Balance
Sheet as of July 31, 2009
|
F-2
|
Statement
of Expenses for the period from July 6, 2009 (inception) to July 31,
2009
|
F-3
|
Statement
of Stockholders’ Deficit for the period from July 6, 2009 (inception) to
July 31, 2009
|
F-4
|
Statement
of Cash Flows for the period from July 6, 2009 (inception) to July 31,
2009
|
F-5
|
Notes
to the Financial Statements – July 31, 2009
|
F-6
|
- 34 -
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the
Board of Directors
Monar
International, Inc.
(A
Development Stage Company)
Carson
City, Nevada
We have
audited the accompanying balance sheet of Monar International, Inc. as of July
31, 2009, and the related statements of expenses, cash flows and changes in
stockholders’ deficit for the period from July 6, 2009 (inception) through July
31, 2009. These financial statements are the responsibility of Monar’s
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We
conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. Monar 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 Monar’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 audits provide 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 Monar International, Inc., as of
July 31, 2009, and the results of its operations and its cash flows for the
period from July 6, 2009 (inception) through July 31, 2009, in conformity with
accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming that Monar
International Inc. will continue as a going concern. As discussed in Note 3 to
the financial statements, Monar has suffered losses from operations which raise
substantial doubt about its ability to continue as a going concern. Management’s
plans regarding those matters also are described in Note 3. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
MALONE & BAILEY,
PC
www.malone-bailey.com
Houston,
Texas
October
7, 2009
F-1
- 35 -
(A
Development Stage Company)
|
||
Balance
Sheet
|
||
July
31, 2009
|
||
ASSETS
|
||
Current
Assets
|
||
Prepaid
Expenses
|
2,230
|
|
Total
Current Assets
|
2,230
|
|
TOTAL
ASSETS
|
$
|
2,230
|
LIABILITIES
AND STOCKHOLDERS’ DEFICIT
|
||
CURRENT
LIABILITIES
|
||
Accounts
payable and accrued expenses
|
$
|
1,000
|
Advance
from officer
|
17,768
|
|
TOTAL
CURRENT LIABILITIES
|
18,768
|
|
COMMITMENTS
AND CONTINGENCIES
|
-
|
|
STOCKHOLDERS’
DEFICIT
|
||
Preferred
stock, $0.0001 par value, 100,000,000 shares authorized, -
|
||
shares
issued and outstanding
|
-
|
|
Common
stock, $0.00001 par value; 100,000,000 shares authorized,
|
||
5,000,000
shares issued and outstanding
|
50
|
|
Additional
paid-in capital
|
-
|
|
Deficit
accumulated during the development stage
|
(16,588)
|
|
TOTAL
STOCKHOLDERS’ DEFICIT
|
(16,538)
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
$
|
2,230
|
See the
accompanying summary of accounting policies and notes to the financial
statements
F-2
- 36 -
Monar
International Inc.
|
|||
(A
Development Stage Company)
|
|||
Statement
of Expenses
|
|||
For
the Period from July 6, 2009 (Inception) to July 31, 2009
|
|||
REVENUES
|
$
|
-
|
|
EXPENSES
|
|||
Professional
fees
|
16,088
|
||
Filing
fees
|
500
|
||
Total
Expenses
|
16,588
|
||
LOSS
FROM OPERATIONS
|
(16,588)
|
||
NET
LOSS
|
$
|
(16,588)
|
|
BASIC
AND DILUTED NET LOSS PER SHARE
|
$
|
(0.00)
|
|
WEIGHTED
AVERAGE NUMBER OF
|
|||
COMMON
SHARES OUTSTANDING,
|
|||
BASIC
AND DILUTED
|
5,000,000
|
F-3
- 37 -
Monar
International Inc.
|
|||||||||
(A
Development Stage Company)
|
|||||||||
Statement
of Stockholders’ Deficit
|
|||||||||
For
the Period from July 6, 2009 (Inception) to July 31,
2009
|
|||||||||
Accumulated
|
|||||||||
Deficit
|
|||||||||
Additional
|
During
|
Total
|
|||||||
Common
Stock
|
Paid-in
|
Development
|
Stockholders’
|
||||||
Shares
|
Amount
|
Capital
|
Stage
|
Deficit
|
|||||
Balance
at inception,
|
|||||||||
July
6, 2009
|
-
|
-
|
-
|
-
|
-
|
||||
Common
stock issued to
|
|||||||||
founder
for cash on July 6,
|
-
|
||||||||
2009
for $0.0001 per share
|
5,000,000
|
50
|
-
|
-
|
50
|
||||
Net
loss for the
|
|||||||||
period
ended July
|
-
|
||||||||
31,2009
|
-
|
-
|
-
|
(16,588)
|
(16,588)
|
||||
|
|||||||||
Balance, July
31,
|
|||||||||
2009
|
5,000,000
|
$
|
50
|
$
|
-
|
$
|
(16,588)
|
$
|
(16,538)
|
See the
accompanying summary of accounting policies and notes to the financial
statements
- 38 -
Monar
International Inc.
(A
Development Stage Company)
Statement
of Cash Flow
For
the Period from July 6, 2009 (Inception) to July 31, 2009
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||
Net
loss
|
$
|
(16,588)
|
Adjustments
to reconcile net loss to cash used by operating
activities:
|
||
Net
change in:
|
||
Prepaid
expenses and other current assets
|
(2,230)
|
|
Accounts
payable and accrued expenses
|
1,000
|
|
NET
CASH USED BY OPERATING ACTIVITIES
|
(17,818)
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||
Advances
payable – related party
|
17,768
|
|
Proceeds
from sale of stock to founder
|
50
|
|
CASH
FLOWS PROVIDED BY FINANCING ACTIVITIES
|
17,818
|
|
NET
INCREASE IN CASH AND CASH EQUIVALENTS
|
-
|
|
Cash
and cash equivalents, beginning of period
|
-
|
|
Cash
and cash equivalents, end of period
|
$
|
-
|
See the
accompanying summary of accounting policies and notes to the financial
statements
F-5
- 39 -
Monar
International
Inc.
(A
DEVELOPMENT STAGE Company)
Notes
to the Financial Statements
NOTE
1 – ORGANIZATION AND BUSINESS OPERATIONS
Monar
International Inc was incorporated in Nevada, USA, on July 6, 2009. The Company
has limited operations and in accordance with SFAS 7, is considered a
development stage company, and has had no revenues from operations to
date.
Initial
operations have included organization, capital formation, target market
identification, and marketing plans. Management is planning to develop a website
develop a website (www.monarinternational.com) that will offer to the public a
tasteful traditional style Chinese furniture adapted to modern needs for Asian
ethnic and high end markets in North America.
The
Company fiscal year end is July 31.
NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
The
financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States of America
(“GAAP”) and the Securities and Exchange Commission Act 1934.
Revenue
Recognition
We
evaluate the criteria outlined in EITF Issue No. 99-19, Reporting Revenue Gross as a
Principal Versus Net as an Agent, in determining whether it is
appropriate to record the gross amount of product sales and related costs or the
net amount earned as commissions. Generally, when we are primarily obligated in
a transaction, are subject to inventory risk, have latitude in establishing
prices and selecting suppliers, or have several but not all of these indicators,
revenue is recorded gross. If we are not primarily obligated and amounts earned
are determined using a fixed percentage, a fixed-payment schedule, or a
combination of the two, we generally record the net amounts as commissions
earned.
Commissions
and per-unit fees received from sellers and similar amounts earned by directing
traffic from our sites to manufacturer’s site are recognized when the item is
sold by seller and our collectability is reasonably assured.
F-6
- 40 -
Use
of Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the
reporting periods. Actual results could materially differ from those
estimates.
Cash
and Cash Equivalents
For
purposes of the statement of cash flows, the Company considers all highly liquid
investments and short-term debt instruments with original maturities of three
months or less to be cash equivalents. As of July 31, 2009, there were no cash
equivalents.
Development
Stage Company
The
Company complies with Statement of Financial Accounting Standard No. 7 and the
Securities and Exchange Commission Exchange Act 7 for its characterization of
the Company as development stage.
Income
Taxes
The
Company accounts for income taxes under the Financial Accounting Standards Board
of Financial Accounting Standard No. 109, "Accounting for Income Taxes". Under
Statement 109, deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
basis. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Under Statement 109, the
effect on deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment date. There was
no current or deferred income tax expense or benefits for the periods ending
July 31, 2009.
Basic net
loss per common share is computed by dividing net loss by the weighted-average
number of common shares outstanding during the period. Diluted net loss per
common share is determined using the weighted-average number of common shares
outstanding during the period, adjusted for the dilutive effect of common stock
equivalents. In periods when losses are reported, the weighted-average number of
common shares outstanding excludes common stock equivalents, because their
inclusion would be anti-dilutive.
Impairment
of Long Lived Assets
Long-lived
assets are reviewed for impairment in accordance with SFAS No. 144, "Accounting
for the Impairment or Disposal of Long- lived Assets". Under SFAS No. 144,
long-lived assets are tested for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. An
impairment charge is recognized or the amount, if any, which the carrying value
of the asset exceeds the fair value.
F-7
- 41 -
Fair
Value of Financial Instruments
The
carrying value of cash and cash equivalents, accounts payable and accrued
expenses and other liabilities approximates fair value due to the short term
maturity of these instruments. The carrying value of the notes payable,
approximate their fair value as July 31, 2009.
Stock
Based Compensation
The
Company accounts for stock-based employee compensation arrangements using the
fair value method in accordance with the provisions of Statement of Financial
Accounting Standards No.123(R) or SFAS No. 123(R), Share-Based Payments, and
Staff Accounting Bulletin No. 107, or SAB 107, Share-Based Payments. The
company accounts for the stock options issued to non-employees in accordance
with the provisions of Statement of Financial Accounting Standards No. 123, or
SFAS No. 123, Accounting for Stock-Based Compensation, and Emerging Issues Task
Force No. 96-18, Accounting for Equity Instruments with Variable Terms That Are
Issued for Consideration other Than Employee Services under FASB Statement No.
123.
The
Company did not grant any stock options or warrants during the period ended July
31, 2009.
Recent
Accounting Pronouncements
There
have been no recently issued accounting pronouncements since
Monar’s inception on July 6, 2009.
NOTE
3 - GOING CONCERN
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern, which contemplates, among other things, the
realization of assets and satisfaction of liabilities in the normal course of
business. The Company has net losses for the period from inception to
July 31, 2009 of $16,588. The Company intends to fund operations
through sales and equity financing arrangements, which may be insufficient to
fund its capital expenditures, working capital and other cash requirements
through the next fiscal year ending July 31, 2010.
The
ability of the Company to emerge from the development stage is dependent upon
the Company's successful efforts to raise sufficient capital and then attaining
profitable operations. These factors, among others, raise substantial doubt
about the Company's ability to continue as a going concern. These financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
NOTE
4 – RELATED PARTY TRANSACTIONS
As at
July 31, 2009, the amount of $17,768 is due to the President and Director for
cash advances to the Company. This advance is non-interest bearing, unsecured
and due on demand. Imputed interest is not included because the amount is
immaterial.
F-8
- 42 -
NOTE
5 – INCOME TAXES
The
Company has tax losses which may be applied against future taxable income. The
potential tax benefits arising from these loss carry forwards expire beginning
in 2029 and are offset by a valuation allowance due to the uncertainty of
profitable operations in the future. The net operating loss carry
forward was $16,588 at July 31, 2009. The significant components of the deferred
tax asset as of July 31, 2009 are as follows:
Net
operating loss carryforwards
|
$
|
16,588
|
||
Valuation
allowance
|
(16,588)
|
|||
Net
deferred tax asset
|
$
|
-
|
NOTE 6 – STOCKHOLDERS’
EQUITY
Monar
issued 5,000,000 shares of common stock (founder’s shares) at par value of
$0.00001 on July 6, 2009 to the President and Director of the Company for
$50.
NOTE
7 – COMMITMENTS
Monar
agreed to pay its securities attorney $25,000 for the initial Form S-1 to file
for SEC reporting status as a public company. $15,000 had been
incurred and paid in July 2009 and the balance is to be paid in August
2009.
F-9
- 43 -
Until
_____________ 2010, ninety days after the date of this prospectus, all dealers
effecting transactions in our registered securities, whether or not
participating in this distribution, may be required to deliver a prospectus.
This is in addition to the obligation of dealers to deliver a prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions .
- 44 -
PART
II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM
13. OTHER EXPENSES OF ISSUANCE AND
DISTRIBUTION.
The estimated expenses of the offering
(assuming all shares are sold), all of which are to be paid by the registrant,
are as follows:
SEC
Registration Fee
|
$
|
8.37
|
Printing
Expenses
|
200.00
|
|
Accounting
Fees and Expenses
|
4,091.63
|
|
Legal
Fees and Expenses
|
25,000.00
|
|
Blue
Sky Fees/Expenses
|
500.00
|
|
Transfer
Agent Fees
|
200.00
|
|
TOTAL
|
$
|
30,000.00
|
ITEM
14.
|
INDEMNIFICATION
OF DIRECTORS AND OFFICERS.
|
The only statute, charter provision,
bylaw, contract, or other arrangement under which any controlling person,
director or officer of the Registrant is insured or indemnified in any
manner
against
any liability which he may incur in his capacity as such, is as
follows:
1.
|
Article
3 of the Articles of Incorporation of the company, filed as Exhibit 3.1 to
the Registration Statement.
|
2.
|
Article
X of the Bylaws of the company, filed as Exhibit 3.2 to the Registration
Statement.
|
3.
|
Nevada
Revised Statutes, Chapter 78.
|
The general effect of the foregoing is
to indemnify a control person, officer or director from liability, thereby
making the company responsible for any expenses or damages incurred by such
control person, officer or director in any action brought against them based on
their conduct in such capacity, provided they did not engage in fraud or
criminal activity.
ITEM
15. RECENT SALES OF UNREGISTERED
SECURITIES.
Since inception, the Registrant has
sold the following securities that were not registered under the Securities Act
of 1933, as amended.
Name
and Address
|
Date
|
Shares
|
Consideration
|
||
Robert
Clarke
|
July
6, 2009
|
5,000,000
|
$
|
50.00
|
|
Suite
1302, Sino Favour Centre
|
|||||
1
On Yip Street
|
|||||
Chaiwan,
Hong Kong
|
We issued the foregoing restricted
shares of common stock to our sole officer and director pursuant to the
exemption from registration contained in Regulation S of the Securities Act of
1933. The transaction took place outside the United States of America
with a non-US person.
- 45 -
ITEM
16. EXHIBITS.
The following exhibits are filed as
part of this registration statement, pursuant to Item 601 of Regulation
S-K.
Exhibit
No.
|
Document
Description
|
3.1*
|
Articles
of Incorporation.
|
3.2*
|
Bylaws.
|
4.1*
|
Specimen
Stock Certificate.
|
5.1*
|
Opinion
of The Law Office of Conrad C. Lysiak, P.S.
|
10.1
|
Memorandum of
Lease .
|
23.1
|
Consent
of Malone & Bailey, Registered Public Accounting
Firm.
|
23.2*
|
Consent
of The Law Office of Conrad C. Lysiak, P.S.
|
99.1*
|
Subscription
Agreement.
|
* Previously
filed.
ITEM
17. UNDERTAKINGS.
A. The
undersigned Registrant hereby undertakes:
|
(1)
|
To
file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement
to:
|
(a)
include any prospectus required by Section
10(a)(3) of the Securities Act;
|
(b)
|
reflect
in the prospectus any facts or events arising after the effective date of
this Registration Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration Statement.
Notwithstanding the foregoing, any increase or decrease in the volume of
securities offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule 424(b) under
the Securities Act if, in the aggregate, the changes in volume and price
represent no more than a 20% change in maximum aggregate offering price
set forth in the “Calculation of Registration Fee” table in the effective
registration statement; and
|
|
(c)
|
include
any additional or changed material information with respect to the plan of
distribution.
|
|
(2)
|
That,
for the purpose of determining any liability under the Securities Act,
each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
|
|
(3)
|
To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
|
- 46 -
|
(4)
|
To
provide to the underwriters at the closing specified in the underwriting
agreement certificates in such denominations and registered in such names
as required by the underwriter to permit prompt delivery to each
purchaser.
|
|
(5)
|
For
purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of a
registration statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of the
registration statement as of the time it was declared
effective.
|
|
(6)
|
For
the purpose of determining any liability under the Securities Act, each
post-effective amendment that contains a form of prospectus shall be
deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering
thereof.
|
(7)
For the purpose of determining liability
under the Securities Act to any purchaser:
|
Each
prospectus filed pursuant to Rule 424(b) under the Securities Act as part
of a registration statement relating to an offering, other than
registration statements relying on Rule 430B or other than prospectuses
filed in reliance on Rule 430A (§§230.430A of this chapter), shall be
deemed to be part of and included in the registration statement as of the
date it is first used after effectiveness. Provided however, that
no statement made in a registration statement or prospectus that is part
of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus
that is part of the registration statement will, as to a purchaser with a
time of contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or prospectus that
was part of the registration statement or made in any such document
immediately prior to such date of first
use.
|
|
(8)
|
For
the purpose of determining liability of the registrant under the
Securities Act to any purchaser in the initial distribution of
securities:
|
|
The
undersigned registrant undertakes that in a primary offering of securities
of the undersigned registrant pursuant to this registration statement,
regardless of the underwriting method used to sell the securities to the
purchaser, if the securities are offered or sold to such purchaser by
means of any of the following communications, the undersigned registrant
will be a seller to the purchaser and will be considered to offer or sell
such securities to such purchaser:
|
|
(a)
|
Any
preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule 424 of this
chapter;
|
|
(b)
|
Any
free writing prospectus relating to the offering prepared by or on behalf
of the undersigned registrant or used or referred to by the undersigned
registrant;
|
- 47 -
|
(c)
|
The
portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or its
securities provided by or on behalf of the undersigned registrant;
and
|
|
(d)
|
Any
other communication that is an offer in the offering made by the
undersigned registrant to the
purchaser.
|
|
B.
|
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the small
business issuer pursuant to the foregoing provisions, or otherwise, the
small business issuer has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the small business issuer of
expenses incurred or paid by a director, officer or controlling person of
the small business issuer in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the small business issuer
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
|
|
C.
|
To
provide to the underwriter at the closing specified in the Underwriting
Agreement certificates in such denominations and registered in such names
as required by the underwriter to permit prompt delivery to each
purchaser.
|
D. The
undersigned Registrant hereby undertakes that:
|
(1)
|
For
purposes of determining any liability under the Securities Act of 1933,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared
effective.
|
|
(2)
|
For
the purpose of determining any liability under the Securities Act of 1933,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering
thereof.
|
- 48 -
SIGNATURES
Pursuant to the requirements of the
Securities Act of 1933, the registrant has duly caused this amended registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized on this 8th day
of October, 2009.
MONAR
INTERNATIONAL INC.
|
||
|
||
BY:
|
ROBERT
CLARKE
|
|
Robert
Clarke
|
||
President,
Principal Executive Officer, Principal Financial Officer, Principal
Accounting Officer, Secretary, Treasurer and sole member of the Board of
Directors
|
KNOW ALL
MEN BY THESE PRESENT, that each person whose signature appears below constitutes
and appoints Robert Clarke as true and lawful attorney-in-fact and agent, with
full power of substitution, for him and in his name, place and stead, in any and
all capacities, to sign any and all amendment (including post-effective
amendments) to this registration statement, and to file the same, therewith,
with the Securities and Exchange Commission, and to make any and all state
securities law or blue sky filings, granting unto said attorney-in-fact and
agent, full power and authority to do and perform each and every act and thing
requisite or necessary to be done in about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying the confirming
all that said attorney-in-fact and agent, or any substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this amended Form S-1
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature
|
Title
|
Date
|
ROBERT
CLARKE
|
President,
Principal Executive Officer,
|
October
8, 2009
|
Robert
Clarke
|
Principal
Financial Officer, Principal Accounting Officer, Secretary, Treasurer and
sole member of the Board of Directors
|
- 49 -
EXHIBIT
INDEX
Exhibit
No.
|
Document
Description
|
3.1*
|
Articles
of Incorporation.
|
3.2*
|
Bylaws.
|
4.1*
|
Specimen
Stock Certificate.
|
5.1*
|
Opinion
of The Law Office of Conrad C. Lysiak, P.S., regarding the legality of the
Securities being registered.
|
10.1
|
Memorandum of
Lease .
|
23.1
|
Consent
of Malone & Bailey, Registered Public Accounting
Firm.
|
23.2*
|
Consent
of The Law Office of Conrad C. Lysiak, P.S.
|
99.1*
|
Subscription
Agreement.
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