Attached files
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| EX-31.1 - CERTIFICATION - El Maniel International Inc | f10k2009ex31i_elmaniel.htm |
| EX-32.1 - CERTIFICATION - El Maniel International Inc | f10k2009ex32i_elmaniel.htm |
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
(Mark
One)
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x
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ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For
the fiscal year ended September 30, 2009
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o
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TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For the
transition period from ___________ to ___________
Commission
File No. 333-148988
EL
MANIEL INTERNATIONAL, INC.
(Name of
small business issuer in its charter)
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NEVADA
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562672870
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(State
or other jurisdiction of
incorporation
or organization)
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(IRS
Employer Identification No.)
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7424
Brighton Village Drive
Raleigh,
NC
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27616
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(Address
of principal executive offices)
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(Zip
Code)
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(919)
538-2305
(Registrant’s
telephone number, including area code)
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Securities
registered under Section 12(b) of the Exchange Act:
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Title
of each class registered:
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Name
of each exchange on which registered:
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None
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None
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Securities
registered under Section 12(g) of the Exchange Act:
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Common
Stock, par value $.001
(Title
of class)
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Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes x No o
Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act.
Yes xNo o
Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B not contained in this form, and no disclosure will be contained,
to the best of the registrant’s knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. o
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes o No o
Indicate
by check mark whether the registrant is a large accelerated filer, an
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.
Large
accelerated
filer o Accelerated
filer o
Non-accelerated
filer o Smaller
reporting
company x
(Do not
check if a smaller reporting company)
Revenues
for year ended September 30, 2009: $5,855
Aggregate
market value of the voting common stock held by non-affiliates of the registrant
as of September 30, 2009, was: $0
Number of
shares of the registrant’s common stock outstanding as of January 6, 2010 was:
96,110,000
Transitional
Small Business Disclosure Format: Yes x No
o
TABLE
OF CONTENTS
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PART
I
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ITEM
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ITEM
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ITEM
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ITEM
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ITEM
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PART
II
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ITEM
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ITEM
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ITEM
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ITEM
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ITEM
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ITEM
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ITEM
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ITEM
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PART
III
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ITEM
10.
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ITEM
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ITEM
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ITEM
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ITEM
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PART
IV
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ITEM
15.
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SIGNATURES
CERTIFICATION
PURSUANT TO SECTION 302 (A) OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
PART
I
ITEM 1. DESCRIPTION OF
BUSINESS
General
We were
incorporated in July 2007 in the State of Nevada. We plan to manufacture and
distribute cigars under the PLC brand name. Beginning in early 2007,
our founders sought to create a cigar that would appeal to aficionados of high
quality, hand-rolled, premium cigars. Our Chief Executive Officer,
Barbara Tejeda, has been a long time resident of the Dominican Republic and has
previously owned a cigar manufacturing company.
Our
management believes the increased popularity of cigar smoking in the United
States is due in part to demographic and social trends. We
believe that the principal changes that have contributed to growth in the cigar
market are (1) the emergence of an expanding base of younger new cigar smokers,
both male and female, (2) increasing popularity of cigars among celebrities who
are viewed as trend-setters, (3) continued media interest, especially through
Cigar Aficionado
magazine, (4) promotion of “cigar friendly” restaurants and nightclubs and (5)
the increase in the population of people over fifty years of age, a group that
has traditionally been viewed as consuming more luxury goods, including cigars,
than other demographic groups.
The U.S.
cigar industry enjoyed an upswing in the 1990s, hitting a zenith in 1997 with
imports of 418 million cigars. The industry’ success in the 1990s came with a
down side, supply couldn’t meet demand and the market became flooded with poor
quality cigars that were sold at inflated prices. According to an article in
USA Today, the market
went into a correction in the late 1990s when many cigar smokers became
dissatisfied with inferior cigars, resulting in “cleaning up” of the mass cigar
market while renewing interest in finding and smoking top-quality
cigars.
During
the mid-2000s, sales of premium cigars, while remaining well below 1997 level,
have been rising steadily (imports of 320 million cigars reported in 2005),
according to the Cigar Association of America, the industry’s trade
association.
The
full-year report for 2007 from the Cigar Association of America shows that
despite smoking bans and higher taxes, imports of premium cigars increased 7.8
percent to more than 335 million, second only to the import of 417.8 million
cigars in 1997. This consistent growth, a few percent points annually, is
credited with a renewed focus by regular and occasional cigar smokers on
purchasing high-quality premium cigars, offering an opportunity for new,
high-quality cigar products to achieve market success.
Our
management believes the increasing popularity of premium-level cigar
smoking in the United States is due in part to demographic and social
trends. Based on information from The Cigar Association of America
and industry news reports, we believe that the principal trends driving growth
in the cigar market include (1) an expanding base of younger new cigar smokers,
both male and female, (2) increasing popularity of cigars among celebrities who
are viewed as trend-setters, (3) continued media interest, especially through
Cigar Aficionado
magazine, (4) promotion of “cigar friendly” restaurants and nightclubs and (5)
the increase in the population of people over 50 years of age, a group that has
traditionally been viewed as consuming more luxury goods, including cigars, than
other demographic groups.
Products
Premium
cigars are generally defined as cigars that are hand-made from high quality,
natural leaf binder, long-filler and wrapper tobaccos and that retail for $5 or
more per cigar. The principal elements that determine the quality of
the cigar are the quality of the tobacco, the curing and aging process and the
skill of the hand-roller. We intend to purchase cigars from one of
the oldest and most reputable cigar manufacturer’ in Santo Domingo the Dominican
Republic. We have selected ABAM, S.A. as the sole provider of cigars. ABAM will
produce PLC Cigars rolled with tobacco grown in the great Cibao Valley, the
place where the best tobacco in the Dominican Republic is grown. Our agreement
with ABAM ran through the end of 2008 and calls for the following payment of
$1.60 per cigar. The Dominican Republic at the present time is recognized
internationally by the quality of its cigars, standing out as the first exporter
of high quality cigars of the world.
-1-
We have
made an initial test sale in the premium corporate gift market in Macau and
based on reception of our initial concept and customer feedback we are making
plans to produce, launch and market our first product offerings. Our first cigar
will be a torpedo-style (52 cm x 5 cm) premium leaf product made in the
Dominican Republic. The first product line, PLC Cigars, will be a distinctive
red, 25-cigar box that can be customized to become a uniquely personal business
client, meeting or special occasion gift.
Prototypes
of our turn-key cigar smoking experience box/packaging have been
created. By turn-key smoking experience box/packaging we are
referring to our cigar box which doubles as Humidor with humidity regulator and
cigar cutter. The box includes 20 PLC branded Cigars. The initial
packaging is designed to provide an elegant, high-quality cigar box with a
humidor. We have filed to obtain trademark protection for the box
design and product logo.
COMPETITION
The Cigar
Association of America currently boasts a roster of approximately 70 members,
many conducting business in the premium cigar segment. We have several large,
well-financed competitors, each holding strong, well-known brand names and
enjoying a history of successful product launches. These companies compete
directly with us for consumer sales, as well as for supplies of tobacco and
employees. The largest of these competitors are Consolidated Cigar Holdings Inc.
(NYSE symbol: “CIG”), General Cigar Co. Inc., a division of Culbro Corporation
(NYSE symbol: “CUC”), and Swisher International Group Inc. (NYSE symbol: “SWR”).
Each of these companies has substantially greater capital resources,
manufacturing, sales and marketing experience, substantially longer and more
extensive relationships with growers and long standing brand recognition and
market acceptance than us. See “RISK FACTORS”.
We
believe, however, that the market for premium cigars is achieving higher
visibility among regular and occasional smokers alike and growing steadily
enough to support the entry of new brands such as PLC Cigars. In addition, we
believe the unique PLC Cigars turn-key packaging and our focus on the high-end
corporate, meetings and special occasion gift markets provides competitive
advantages as well as enhanced revenue opportunity.
MARKETING
We are a
development stage company and have not commenced any marketing campaigns.We will
utilize a combination of direct sales and online marketing to launch the
Company’s first product line, a unique cigar package aimed at the premium
corporate, event and special occasion gift markets. Our web site at www.elmanielonline.com
is currently under construction. Once operational, the web site will become the
primary sales transaction vehicle, to be augmented with a toll-free number
outsourced to an established telesales organization.
Our
marketing strategy is to utilize field sales reps and targeted online direct
marketing to slowly build sales and to gain critical market and customer
intelligence. Target markets include corporate/client gifts for the financial
community and meeting/event gifts for male-oriented industries such as
technology and manufacturing. Utilizing a product seeding program, email blasts
to targeted industry lists and public relations efforts to secure media coverage
and initiate viral promotion, we seek to generate product awareness among
premium cigar smokers who wish to provide a unique gift to their business
associates, event attendees or to commemorate a special occasion. Prospective
customers will be driven to the online e-commerce site, where prospective
customers can gather information about PLC Cigars and place orders. Customers
can also place orders using a toll-free number as an alternative to online
purchasing.
To enter
the market more quickly, a contract fulfillment partner or distributor is being
investigated. The ideal partner will possess all licenses needed to sell
non-cigarette tobacco products in the U.S. and Canada.
On
October 12, 2007, we entered into a letter agreement with Europa Capital
Investments, LLC for general administrative services. Pursuant to the Agreement
we pay a monthly fee of $5,000 to Europa for the general administrative services
which include general accounting services and meeting space. In addition, Europa
provides consulting services on the process of going public and consulting on
potential business opportunities. The agreement was terminated in November
2008.
-2-
ITEM 1A. RISK FACTORS
None.
ITE
M
2. DESCRIPTION OF
PROPERTY
Our
business office is located at 7424 Brighton Village Drive Raleigh, NC
27616. We currently lease this office at no charge from Barbara
Tejada, our Chief Executive Officer, at no charge to us. Currently, this space
is sufficient to meet our needs; however, if we expand our business to a
significant degree, we will have to find a larger space.
ITEM
3. LEGAL PROCEEDINGS
We are
not presently parties to any litigation, nor to our knowledge and belief is any
litigation threatened or contemplated.
ITEM 4. SUBMISSION OF
MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART
II
ITEM 5. MARKET FOR COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS
Our
shares of common stock began trading under the symbol “EMLL:OB” on the OTCBB on
July 23, 2008. Prior to this period, there was minimal trading in our
common stock. On August 5, 2009, the Company's Board of Directors
declared a fourteen-for-one stock split which was distributed on August 5, 2009
to shareholders of record. A total of 89,245,000 shares of common
stock were issued. All basic and diluted loss per share and average
shares outstanding information has been adjusted to reflect the aforementioned
stock split.
Holders
of Our Common Stock
As of
January 6, 2010, we had 51 shareholders of our common stock.
Stock
Option Grants
To date,
we have not granted any stock options.
Registration
Rights
We have
not granted registration rights to the selling shareholders or to any other
persons.
ITEM 6. SELECTED FINANCIAL
DATA.
Not
applicable.
ITEM 7. MANAGEMENT’S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
Plan of
Operation
We have
completed the design and manufacture of the cigar box from China and ordered
1,000 boxes for inventory. Additionally we have ordered cigars that are being
held in inventory by the manufacturer for delivery as we are able to make sales.
We have also finished the web site which we think will be an important tool for
the sale of the product. Once the cigar box was completed and the website was
operational we began introducing the cigars to different consumer groups seeking
to generate some interest. Our initial efforts was to firms in the
financial services industry with little success. We will begin to work on
wedding planners which we see as a possible source of
introduction.
-3-
We have
tried to find a third-party order and fulfillment partner with all the necessary
licenses to sell and deliver cigar products in the U.S. and Canada. We hope that
this would allow us the fastest access to the markets through a well-established
and experienced fulfillment organization.
We have
seen a significant slow down in the market opportunity for specialty cigars in
the last half of 2009 Over the next 12 months we will try to get back on track
of hitting our target to place approximately 100-200 units with opinion leaders,
media professionals and prospective customers to start to generate awareness of
the PLC Cigars product line and initiate the sales effort; conduct at least
three direct email blasts to targeted contacts from cigar industry media
subscriber lists; sponsor at least two small events in conjunction with cigar
industry events, such as the industry’s annual trade show and convention in
July; and place advertising on three targeted cigar industry online
media.
We have
run through our initial marketing budget primarily through the purchase of
inventory and initial marketing expenses. This essentially covered
the cost of inventory to fulfill orders that may come from the marketing
efforts. We have a cost for each box of $21.50 and a replaceable placard for
personalizing the boxes at $2.80 per box. We initially ordered 1,000 units for
inventory at a cost of approximately $24,300 without the cost of shipping and
handling. There will be an additional cost to fulfill the orders if it becomes
necessary. We are currently fulfilling any orders we have from local inventory
though we still have inventory with the manufacturer if it becomes
necessary.
We are in
the process of assessing our marketing and sales efforts and possible results in
light of the company’s dire financial status. News announcements, email blasts,
seeding efforts and event sponsorship are expected to continue as the primary
marketing and promotion efforts to drive sales and revenue
growth.
If we are
unable to gain any market share for our premium cigars, we may have to suspend
or cease our efforts. If we cease our previously stated efforts, we
do not have plans to pursue other business opportunities. If we cease
operations, investors will not receive any return on their
investments.
Limited Operating
History
The
initial efforts of our founders to establish a cigar company began in early
2007. We were formed in July 2007 and we have limited operations upon
which an evaluation of our company and our prospects can be
based. There can be no assurance that our management will be
successful in completing our product development programs, implementing the
corporate infrastructure to support operations at the levels called for by
our business plan, conclude a successful sales and marketing plan to attain
significant penetration of the premium cigar market segment or that we will
generate sufficient revenues to meet its expenses or to achieve or maintain
profitability.
Results of
Operation
For the
year ended September 30, 2009, we had $5,855 in revenue and $34,046 of cost of
goods sold which included an impairment of inventory of $30,252 for a gross loss
of $28,191. Expenses for the period totaled $62,375 resulting in a loss of
$90,566. Expenses of $62,375 for the period consisted of $14,432 for general and
administrative expenses, $2,145 for advertising expenses and $45,798 for
professional fees. Revenues are down in 2009 because our business slowed
considerable as the economy turned down. We could only generate a small amount
of sales because both direct and “on line” sales were greatly affected by the
economy. We were also forced to write off a substantial amount of inventory in
fiscal 2009 because it sat too long and was no longer capable of being
sold.
For the
year ended September 30, 2008, we had $14,205 in revenue and $12,995 of cost of
goods sold for a gross profit of $1,210. Expenses for the period totaled
$142,074 resulting in a loss of $140,864. Expenses of $142,074 for the period
consisted of $16,465 for general and administrative expenses, $7,067 for
advertising expenses and $118,542 for professional fees. Fiscal year
2008 was slightly better in terms of the economy and it was really the beginning
of our cigar sales. Consequently, we had some sales in Fiscal 2008
but we also had a large amount of professional fees which involved setting up
all aspects of the cigar sales which included sourcing our product and
additionally involved the typical expenses of being a public
company.
-4-
For the
period from inception through September 30, 2009, we had $20,060 in revenue and
$47,041 of cost of goods sold which included an impairment of inventory of
$30,252 for a gross loss of $26,981. Expenses for the period totaled $225,000
resulting in a loss of $251,981. Expenses of $225,000 for the period consisted
of $39,348 for general and administrative expenses, $9,212 for advertising and
$176,440 for professional fees.
Capital Resources and
Liquidity
As of
September 30, 2009 we had $919 in cash.
We
believe that we will need additional funding to satisfy our cash requirements
for the next twelve months. Completion of our plan of operations is subject to
attaining adequate revenue or financing. We cannot assure investors that we will
generate the revenues needed or that additional financing will be available. In
the absence of attaining adequate revenue or additional financing, we may be
unable to proceed with our plan of operations.
We
anticipate that our operational, and general and administrative expenses for the
next 12 months will total approximately $150,000. We do not anticipate the
purchase or sale of any significant equipment. We also do not expect any
significant additions to the number of employees. The foregoing represents our
best estimate of our cash needs based on current planning and business
conditions. The exact allocation, purposes and timing of any monies raised
in subsequent private financings may vary significantly depending upon the exact
amount of funds raised and our progress with the execution of our business plan.
We anticipate that depending on market conditions and our plan of operations, we
may incur operating losses in the foreseeable future. Therefore, our auditors
have raised substantial doubt about our ability to continue as a going
concern.
Critical Accounting
Policies
The
Company’s financial statements and related public financial information are
based on the application of accounting principles generally accepted in the
United States (“GAAP”). GAAP requires the use of estimates; assumptions,
judgments and subjective interpretations of accounting principles that have an
impact on the assets, liabilities, revenue and expense amounts reported. These
estimates can also affect supplemental information contained in our external
disclosures including information regarding contingencies, risk and financial
condition. We believe our use if estimates and underlying accounting assumptions
adhere to GAAP and are consistently and conservatively applied. We base our
estimates on historical experience and on various other assumptions that we
believe to be reasonable under the circumstances. Actual results may differ
materially from these estimates under different assumptions or conditions. We
continue to monitor significant estimates made during the preparation of our
financial statements.
Our
significant accounting policies are summarized in Note 1 of our financial
statements. While all of these significant accounting policies impact the
Company’s financial condition and results of operations, we view certain of
these policies as critical. Policies determined to be critical are those
policies that have the most significant impact on the Company and require
management to use a greater degree of judgment and estimates. Actual
results may differ from those estimates. Our management believes that given
current facts and circumstances, it is unlikely that applying any other
reasonable judgments or estimate methodologies would cause effect
on our financial position or liquidity, results of operations or cash
flows for the periods presented.
Recent Accounting
Pronouncements
In
June 2009, the FASB issued ASC 105 Accounting Standards
Codification
TM and the Hierarchy of
Generally Accepted Accounting Principles. The FASB Accounting Standards
Codification TM
(the “Codification”) has become the source of authoritative accounting
principles recognized by the FASB to be applied by nongovernmental entities in
the preparation of financial statements in accordance with Generally Accepted
Accounting Principles (“GAAP”). All existing accounting standard documents are
superseded by the Codification and any accounting literature not included in the
Codification will not be authoritative. Rules and interpretive releases of the
SEC issued under the authority of federal securities laws, however, will
continue to be the source of authoritative generally accepted accounting
principles for SEC registrants. Effective September 30, 2009, all
references made to GAAP in our consolidated financial statements will include
references to the new Codification. The Codification does not change or alter
existing GAAP and, therefore, will not have an impact on our financial position,
results of operations or cash flows.
-5-
In June
2009, the FASB issued changes to the consolidation guidance applicable to a
variable interest entity (VIE). FASB ASC Topic 810, "Consolidation," amends the
guidance governing the determination of whether an enterprise is the primary
beneficiary of a VIE, and is, therefore, required to consolidate an entity, by
requiring a qualitative analysis rather than a quantitative analysis. The
qualitative analysis will include, among other things, consideration of who has
the power to direct the activities of the entity that most significantly impact
the entity's economic performance and who has the obligation to absorb losses or
the right to receive benefits of the VIE that could potentially be significant
to the VIE. This standard also requires continuous reassessments of whether an
enterprise is the primary beneficiary of a VIE. FASB ASC 810 also requires
enhanced disclosures about an enterprise's involvement with a VIE. Topic 810 is
effective as of the beginning of interim and annual reporting periods that begin
after November 15, 2009. This will not have an impact on the Company’s financial
position, results of operations or cash flows.
In June
2009, the FASB issued Financial Accounting Standards Codification No. 860 -
Transfers and Servicing. FASB ASC No. 860 improves the relevance,
representational faithfulness, and comparability of the information that a
reporting entity provides in its financial statements about a transfer of
financial assets; the effects of a transfer on its financial position, financial
performance, and cash flows; and a transferor's continuing involvement, if any,
in transferred financial assets. FASB ASC No. 860 is effective as of the
beginning of each reporting entity's first annual reporting period that begins
after November 15, 2009, for interim periods within that first annual reporting
period and for interim and annual reporting periods thereafter. The Company is
evaluating the impact the adoption of FASB ASC No. 860 will have on its
financial statements.
Off Balance Sheet
Transactions
We have
no off-balance sheet arrangements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK.
Market
risk is the risk of loss from adverse changes in market prices and interest
rates. We do not have substantial operations at this time so they are not
susceptible to these market risks. If, however, they begin to
generate substantial revenue, their operations will be materially impacted by
interest rates and market prices.
-6-
ITEM
8.
FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA.
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
CONTENTS
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PAGE
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F-1
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REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
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PAGE
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F-2
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CONSOLIDATED
BALANCE SHEETS AS OF SEPTEMBER 30, 2009 AND 2008.
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PAGE
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F-3
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CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE YEARS ENDED SEPTEMBER 30, 2009 AND 2008,
AND FOR THE PERIOD FROM JULY 24, 2007 (INCEPTION) TO SEPTEMBER 30,
2009.
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PAGE
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F-4
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CONSOLIDATED
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIENCY) FOR THE PERIOD
FROM JULY 24, 2007 (INCEPTION) TO SEPTEMBER 30, 2009.
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PAGE
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F-5
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CONSOLIDATED
STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED SEPTEMBER 30, 2009 AND 2008,
AND FOR THE PERIOD FROM JULY 24, 2007 (INCEPTION) TO SEPTEMBER 30,
2009.
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PAGES
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F-6
- F-13
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NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS.
|
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
To the
Board of Directors of:
El Maniel
International, Inc.
(A
Development Stage Company)
We have
audited the accompanying consolidated balance sheets of El Maniel International,
Inc. and subsidiary (A Development Stage Company) as of September 30, 2009 and
2008, and the related consolidated statements of operations, changes in
stockholder’s equity (deficiency) and cash flows for the two years then ended
and the period from July 24, 2007 (inception) to September 30,
2009. These financial statements are the responsibility of the
Company’s management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We
conducted our audits in accordance with the 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. 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 consolidated financial statements referred to above present fairly
in all material respects, the consolidated financial position of El Maniel
International, Inc. and subsidiary (A Development Stage Company) as of September
30, 2009 and 2008 and the results of its consolidated operations and its cash
flows for the two years then ended and the period from July 24, 2007 (inception)
to September 30, 2009 in conformity with accounting principles generally
accepted in the United States of America.
The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 7
to the consolidated financial statements, the Company is in the development
stage with minimal operations, used cash in operations of $232,203 from
inception and has a net loss since inception of $251,981 for the period from
July 24, 2007 (inception) to September 30, 2009. In addition, there
is a working capital deficiency of $51,470 and stockholders’ deficiency of
$49,010 as of September 30, 2009. This raises substantial doubt about
its ability to continue as a going concern. Management’s plans
concerning this matter are also described in Note 7. The accompanying
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ WEBB & COMPANY,
P.A.
WEBB
& COMPANY, P.A.
Boynton
Beach, Florida
December
23, 2009
F-1
|
El
Maniel International, Inc. and Subsidiary
|
||||||||
|
(A
Development Stage Company)
|
||||||||
|
Consolidated Balance Sheets
|
||||||||
|
ASSETS
|
||||||||
|
September
30,
|
September
30,
|
|||||||
|
2009
|
2008
|
|||||||
|
Current
Assets
|
||||||||
|
Cash
|
$ | 919 | $ | 22,546 | ||||
|
Prepaid
expense
|
- | 750 | ||||||
|
Inventory
|
- | 4,198 | ||||||
|
Deposit
|
- | 10,650 | ||||||
|
Total
Current Assets
|
919 | 38,144 | ||||||
|
Property and
Equipment, net
|
2,460 | 2,310 | ||||||
|
Total Assets
|
$ | 3,379 | $ | 40,454 | ||||
|
LIABILITIES AND STOCKHOLDERS'
EQUITY(DEFICIENCY)
|
||||||||
|
Current
Liabilities
|
||||||||
|
Accounts
payable
|
$ | 1,419 | $ | 2,495 | ||||
|
Sales
tax payable
|
540 | - | ||||||
|
Note
payable
|
49,349 | - | ||||||
|
Loan
payable - related party
|
1,081 | 1,603 | ||||||
|
Total Liabilities
|
52,389 | 4,098 | ||||||
|
Commitments
and Contingencies
|
- | - | ||||||
|
Stockholders'
Equity(Deficiency)
|
||||||||
|
Common
stock, $0.001 par value; 110,000,000 shares authorized,
|
||||||||
|
96,110,000
and 96,110,000 issued and outstanding, respectively
|
96,110 | 96,110 | ||||||
|
Additional
paid-in capital
|
106,861 | 101,661 | ||||||
|
Deficit
accumulated during the development stage
|
(251,981 | ) | (161,415 | ) | ||||
|
Total
Stockholders' Equity(Deficiency)
|
(49,010 | ) | 36,356 | |||||
|
Total
Liabilities and Stockholders' Equity(Deficiency)
|
$ | 3,379 | $ | 40,454 | ||||
See
accompanying notes to consolidtaed financial statements
F-2
|
El
Maniel International, Inc. and Subsidiary
|
||||||||||||
|
(A
Development Stage Company)
|
||||||||||||
|
Consolidated Statements of
Operations
|
||||||||||||
|
For
the Years Ended
|
For
the Period from July 24, 2007
|
|||||||||||
|
September
30, 2009
|
September
30, 2008
|
(inception)
to September 30, 2009
|
||||||||||
|
Revenue
|
$
|
5,855
|
$
|
14,205
|
$
|
20,060
|
||||||
|
Cost
of Revenue
|
(34,046
|
)
|
(12,995
|
)
|
(47,041
|
)
|
||||||
|
Gross
Profit (loss)
|
(28,191
|
)
|
1,210
|
(26,891
|
)
|
|||||||
|
Operating
Expenses
|
||||||||||||
|
Professional
fees
|
45,798
|
118,542
|
176,440
|
|||||||||
|
Advertising
expense
|
2,145
|
7,067
|
9,212
|
|||||||||
|
General
and administrative
|
14,432
|
16,465
|
39,348
|
|||||||||
|
Total
Operating Expenses
|
62,375
|
142,074
|
225,000
|
|||||||||
|
LOSS
FROM OPERATIONS BEFORE INCOME TAXES
|
(90,566
|
)
|
(140,864
|
)
|
(251,981
|
)
|
||||||
|
Provision
for Income Taxes
|
-
|
-
|
-
|
|||||||||
|
NET
LOSS
|
$
|
(90,566
|
)
|
$
|
(140,864
|
)
|
$
|
(251,981
|
)
|
|||
|
Net
Loss Per Share - Basic and Diluted
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
||||||
|
Weighted
average number of shares outstanding
|
||||||||||||
|
during
the year - Basic and Diluted
|
96,110,000
|
95,281,130
|
||||||||||
See
accompanying notes to consolidtaed financial statements
F-3
|
El
Maniel International, Inc. and Subsidiary
|
||||||||||||||||||||||||
|
(A
Development Stage Company)
|
||||||||||||||||||||||||
|
Consolidated
Statement of Stockholders' Equity (Deficiency)
|
||||||||||||||||||||||||
|
For the period from July 24, 2007 (Inception) to
September 30, 2009
|
||||||||||||||||||||||||
|
Deficit
|
||||||||||||||||||||||||
|
accumulated
|
Total
|
|||||||||||||||||||||||
|
Common
stock
|
Additional
|
during
the
|
Stockholder's
|
|||||||||||||||||||||
|
paid-in
|
development
|
Subscription
|
Equity
|
|||||||||||||||||||||
|
Shares
|
Amount
|
capital
|
stage
|
Receivable
|
(Deficiency)
|
|||||||||||||||||||
|
Balance
July 24, 2007
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
|
Common
stock issued for services to founder ($0.001)
|
70,000,000 | 70,000 | (65,000 | ) | - | - | 5,000 | |||||||||||||||||
|
Common
stock issued for cash ($0.10/ per share)
|
1,400,000 | 1,400 | 8,600 | - | (10,000 | ) | - | |||||||||||||||||
|
In
kind contribution of cash
|
- | - | 100 | - | - | 100 | ||||||||||||||||||
|
In
kind contribution of services
|
- | - | 971 | - | - | 971 | ||||||||||||||||||
|
Net
loss for the period July 24, 2007 (inception) to September 30,
2007
|
- | - | - | (20,551 | ) | - | (20,551 | ) | ||||||||||||||||
|
Balance,
September 30, 2007
|
71,400,000 | 71,400 | (55,329 | ) | (20,551 | ) | (10,000 | ) | (14,480 | ) | ||||||||||||||
|
Cash
collected on subscription receivable
|
- | - | - | - | 10,000 | 10,000 | ||||||||||||||||||
|
Common
stock issued for cash ($0.10/ per share)
|
24,710,000 | 24,710 | 151,790 | - | - | 176,500 | ||||||||||||||||||
|
In
kind contribution of services
|
- | - | 5,200 | - | - | 5,200 | ||||||||||||||||||
|
Net
loss, for the year ended September 30, 2008
|
- | - | - | (140,864 | ) | - | (140,864 | ) | ||||||||||||||||
|
Balance,
September 30, 2008
|
96,110,000 | 96,110 | 101,661 | (161,415 | ) | - | 36,356 | |||||||||||||||||
|
In
kind contribution of services
|
- | - | 5,200 | - | - | 5,200 | ||||||||||||||||||
|
Net
loss, for the year ended September 30, 2009
|
- | - | - | (90,566 | ) | - | (90,566 | ) | ||||||||||||||||
|
Balance, September
30, 2009
|
96,110,000 | $ | 96,110 | $ | 106,861 | $ | (251,981 | ) | $ | - | $ | (49,010 | ) | |||||||||||
See
accompanying notes to consolidtaed financial statements
F-4
|
El
Maniel International, Inc. and Subsidiary
|
||||||||||||
|
(A
Development Stage Company)
|
||||||||||||
|
Consolidated Statements of Cash
Flows
|
||||||||||||
| For the Period | ||||||||||||
|
For the Year Ended
|
For the
|
From
July 24, 2007
|
||||||||||
|
Year Ended
September 30, 2009
|
Year Ended
September 30, 2008
|
(Inception) to
September 30, 2009
|
||||||||||
|
Cash
Flows Used In Operating Activities:
|
||||||||||||
|
Net
Loss
|
$ | (90,566 | ) | $ | (140,864 | ) | $ | (251,981 | ) | |||
|
Adjustments
to reconcile net loss to net cash used in operations
|
||||||||||||
|
Amortization
|
1,258 | 190 | 1,448 | |||||||||
|
Loss
on impairment of inventory
|
30,252 | - | 30,252 | |||||||||
|
Common
stock issued for services
|
- | - | 5,000 | |||||||||
|
In-kind
contribution of services
|
5,200 | 5,200 | 11,371 | |||||||||
|
Changes
in operating assets and liabilities:
|
||||||||||||
|
(Increase)/Decrease
in prepaid expense
|
750 | (750 | ) | - | ||||||||
|
(Increase)/Decrease
in inventory
|
(26,054 | ) | (4,198 | ) | (30,252 | ) | ||||||
|
(Increase)/Decrease
in deposit
|
10,650 | (10,650 | ) | - | ||||||||
|
Increase/(Decrease)
in accounts payable and accrued expenses
|
(536 | ) | (10,437 | ) | 1,959 | |||||||
|
Net
Cash Used In Operating Activities
|
(69,046 | ) | (161,509 | ) | (232,203 | ) | ||||||
|
Cash
Flows From Investing Activities:
|
(1,408 | ) | (2,500 | ) | (3,908 | ) | ||||||
|
Net
Cash Used In Investing Activities
|
(1,408 | ) | (2,500 | ) | (3,908 | ) | ||||||
|
Cash
Flows From Financing Activities:
|
||||||||||||
|
Proceeds
from note payable
|
- | - | - | |||||||||
|
Proceeds
from loan payable- related party
|
1,001 | - | 2,604 | |||||||||
|
Repayment
of loan payable - related party
|
(1,523 | ) | - | (1,523 | ) | |||||||
|
In-kind
contribution of cash
|
- | - | 100 | |||||||||
|
Proceeds
from loans payable
|
50,349 | - | 50,349 | |||||||||
|
Repayment
of loan payable
|
(1,000 | ) | - | (1,000 | ) | |||||||
|
Proceeds
from issuance of common stock
|
- | 186,500 | 186,500 | |||||||||
|
Net
Cash Provided by Financing Activities
|
48,827 | 186,500 | 237,030 | |||||||||
|
Net
Decrease/(Decrease) in Cash
|
(21,627 | ) | 22,491 | 919 | ||||||||
|
Cash
at Beginning of Year/Period
|
22,546 | 55 | - | |||||||||
|
Cash
at End of Year/Period
|
$ | 919 | $ | 22,546 | $ | 919 | ||||||
|
Supplemental disclosure of cash flow
information:
|
||||||||||||
|
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
|
Cash
paid for taxes
|
$ | - | $ | - | $ | - | ||||||
See
accompanying notes to consolidtaed financial statements
F-5
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
NOTE
1 SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES AND ORGANIZATION
(A)
Organization
El Maniel
International, Inc. (a development stage company) was incorporated under the
laws of the State of Nevada on July 24, 2007. El Maniel Cigar Company
(a development stage company) was incorporated under the laws off the State of
Nevada on September 24, 2007. El Maniel International, Inc. and El Maniel Cigar
Company (the “Company”) are creating a new premium brand of cigar.
Activities
during the development stage include developing the business plan and raising
capital.
(B) Principles of
Consolidation
The
accompanying condensed consolidated financial statements include the accounts of
El Maniel International, Inc. from July 24, 2007 (inception) and its 100% owned
subsidiary El Maniel Cigar Company. All inter-company accounts have
been eliminated in the consolidation (See Note 4(E)).
(C) Use of
Estimates
In
preparing financial statements in conformity with generally accepted accounting
principles, management is required to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of contingent
assets and liabilities at the date of the financial statements and revenues and
expenses during the reported period. Actual results could differ from
those estimates.
(D) Cash and Cash
Equivalents
The
Company considers all highly liquid temporary cash investments with an original
maturity of three months or less to be cash equivalents. At September 30, 2009
and 2008, respectively, the Company had no cash equivalents.
(E) Website Development
Costs
Costs
incurred in the planning stage of a website are expensed while costs incurred in
the development stage are capitalized and amortized over the estimated
three-year life of the asset. For the years ended September 30, 2009 and 2008,
the Company paid $1,408 and $2,500, respectively, to develop its
website.
F-6
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
(F) Loss Per
Share
Basic and
diluted net loss per common share is computed based upon the weighted average
common shares outstanding as defined by FASB Accounting Standards Codification
Topic 260, “Earnings Per Share.” As of September 30, 2009 and 2008,
respectively, there were no common share equivalents outstanding.
(G) Income
Taxes
The
Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC
740-10-25”). Under ASC 740-10-25, 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 bases. 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 ASC 740-10-25, 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.
As of
September 30, 2009, the Company has a net operating loss carryforward of
approximately $204,933 available to offset future taxable income through
2029. The valuation allowance at September 30, 2009 was
$78,346. The net change in the valuation allowance for the period
ended September 30, 2009 was an increase of approximately $32,000.
(H) Business
Segments
The
Company operates in one segment and therefore segment information is not
presented.
(I) Concentrations
During
2009, the Company purchased 100% of its cigars from one vendor.
For the
year ended September 30, 2009, 43% of sales are to Customer A, 34% to Customer
B, and 21% to Customer C.
For the
year ended September 30, 2008, one customer accounted for 100% of the Company’s
sales.
(J) Revenue
Recognition
The
Company recognized revenue on arrangements in accordance with FASB Codification
Topic 605, “Revenue
Recognition” (“ASC Topic 605”). Under ASC Topic 605, revenue
is recognized only when the price is fixed and determinable, persuasive evidence
of an arrangement exists, the service is performed and collectability of the
resulting receivable is reasonably assured. Revenue is recognized
when products are received and accepted by the customer. Risk of loss
transfers from the manufacturer to the Company upon shipment of product from the
warehouse.
F-7
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
(K)
Inventories
Inventories
are valued at the lower of cost or market. Cost is determined using
the first-in, first-out (FIFO) method. Provision for potentially obsolete or
slow moving inventory is made based on management's analysis of inventory levels
and future sales forecasts. At September 30, 2009, the Company determined that
inventory on hand was slow moving and recognized an impairment loss of
$30,252. Inventory consisted of the following at September 30, 2009
and September 30, 2008:
|
|
September 30, 2009 | September 30, 2008 | ||||||
|
Raw
Materials
|
$ | 23,550 | $ | 2,250 | ||||
|
Work
in
Process
|
- | - | ||||||
|
Finished
|
6,702 | 1,948 | ||||||
|
Provision
for
impairment
|
(30,252 | ) | - | |||||
|
Net
Inventory
|
$ | - | $ | 4,198 | ||||
(L) Advertising and
Promotional Expense
Advertising
and other product-related costs are charged to expense as incurred. For the
period ended September 30, 2009 and 2008, advertising expense was $2,145 and
$7,067, respectively.
(M)
Reclassification
Certain
amounts from prior period have been reclassified to conform to the current
period presentation.
(N) Recent Accounting
Pronouncements
In
June 2009, the FASB issued ASC 105 Accounting Standards
Codification
TM and the Hierarchy of
Generally Accepted Accounting Principles. The FASB Accounting Standards
Codification TM
(the “Codification”) has become the source of authoritative accounting
principles recognized by the FASB to be applied by nongovernmental entities in
the preparation of financial statements in accordance with Generally Accepted
Accounting Principles (“GAAP”). All existing accounting standard documents are
superseded by the Codification and any accounting literature not included in the
Codification will not be authoritative. Rules and interpretive releases of the
SEC issued under the authority of federal securities laws, however, will
continue to be the source of authoritative generally accepted accounting
principles for SEC registrants. Effective September 30, 2009, all
references made to GAAP in our consolidated financial statements will include
references to the new Codification. The Codification does not change or alter
existing GAAP and, therefore, will not have an impact on our financial position,
results of operations or cash flows.
F-8
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
In June
2009, the FASB issued changes to the consolidation guidance applicable to a
variable interest entity (VIE). FASB ASC Topic 810, "Consolidation," amends the
guidance governing the determination of whether an enterprise is the primary
beneficiary of a VIE, and is, therefore, required to consolidate an entity, by
requiring a qualitative analysis rather than a quantitative analysis. The
qualitative analysis will include, among other things, consideration of who has
the power to direct the activities of the entity that most significantly impact
the entity's economic performance and who has the obligation to absorb losses or
the right to receive benefits of the VIE that could potentially be significant
to the VIE. This standard also requires continuous reassessments of whether an
enterprise is the primary beneficiary of a VIE. FASB ASC 810 also requires
enhanced disclosures about an enterprise's involvement with a VIE. Topic 810 is
effective as of the beginning of interim and annual reporting periods that begin
after November 15, 2009. This will not have an impact on the Company’s financial
position, results of operations or cash flows.
In June
2009, the FASB issued Financial Accounting Standards Codification No. 860 -
Transfers and Servicing. FASB ASC No. 860 improves the relevance,
representational faithfulness, and comparability of the information that a
reporting entity provides in its financial statements about a transfer of
financial assets; the effects of a transfer on its financial position, financial
performance, and cash flows; and a transferor's continuing involvement, if any,
in transferred financial assets. FASB ASC No. 860 is effective as of the
beginning of each reporting entity's first annual reporting period that begins
after November 15, 2009, for interim periods within that first annual reporting
period and for interim and annual reporting periods thereafter. The Company is
evaluating the impact the adoption of FASB ASC No. 860 will have on its
financial statements.
NOTE
2 PROPERTY AND
EQUIPMENT
At
September 30, 2009 and September 30, 2008 property and equipment is as
follows:
|
September
30, 2009
|
September
30, 2008
|
|||||||
|
Website
costs
|
$ | 3,908 | $ | 2,500 | ||||
|
Less
accumulated amortization
|
(1,448 | ) | (190 | ) | ||||
| $ | 2,460 | $ | 2,310 | |||||
F-9
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
Amortization
expense for the years ended September 30, 2009 and 2008 and the period from July
24, 2007 (inception) to September 30, 2009 was $1,258, $190 and $1,448,
respectively.
NOTE
3 LOANS
PAYABLE
For the
year ended September 30, 2009, a related party loaned the Company
$483. The Company entered into a written promissory note concerning
this obligation. The loan is noninterest bearing and payable on
demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0 (See Note 6).
For the
year ended September 30, 2009, a non related party loaned the Company
$276. The loan is noninterest bearing and payable on demand. As of
September 30, 2009, the loan balance is $276 and is not in
default. This loan was repaid in October 2009 (see Note
8).
On August
11, 2009, a non related party loaned the Company $48,000. The Company entered
into a written promissory note concerning this obligation. The loan is
noninterest bearing and payable on demand. As of September 30, 2009,
the loan balance is $48,000 and is not in default.
During
February 2009, a non related party loaned the Company $1,073. The Company
entered into a written promissory note concerning this obligation. The loan is
noninterest bearing and payable on demand. As of September 30, 2009, the loan
balance is $1,073 and is not in default.
During
December 2008, the Company received $518 from a relative of the principal
stockholder. Pursuant to the terms of the loan, the loan is noninterest bearing
and due on demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0 (See Note 6).
For the
year ended September 30, 2007, the Company received $1,603 from a principal
stockholder. Pursuant to the terms of the loan, the loan is non interest bearing
and due on demand. As of September 30, 2009, the Company still owes $1,081 to
the principal shareholder (See Note 6).
F-10
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
NOTE
4 STOCKHOLDERS’
EQUITY
(A) Common Stock Issued for
Cash
As of
December 31, 2007, the Company issued 1,765,000 shares of common stock for
$176,500 ($0.10/share). As a result of the forward split, the
1,765,000 were increased to 24,710,000 shares ($0.007/share).
For the
period from July 24, 2007 (inception) through September 30, 2007, the Company
issued 100,000 shares of common stock for a subscription receivable of $10,000
($0.10/share). The subscription receivable was collected during the
period ending December 31, 2007. As a result of the forward split the
100,000 were increased to 1,400,000 shares ($0.007/share).
(B) In-Kind Contribution of
Services
For the
year ended September 30, 2009, a shareholder of the Company contributed services
having a fair value of $5,200 (See Note 6).
As of
September 30, 2008, a shareholder of the Company contributed services having a
fair value of $5,200 (See Note 6).
For the
period from July 24, 2007 (inception) through September 30, 2007, the
shareholder of the Company contributed services having a fair value of $971 (See
Note 6).
(C) In-Kind Contribution of
Cash
As of
September 30, 2007, the shareholder of the Company contributed cash of $100 to
cover the costs of setting up the subsidiary (See Note 6).
(D) Stock Issued for
Services
On July
24, 2007, the Company issued 5,000,000 shares of common stock to its founders
having a fair value of $5,000 ($0.001/share) in exchange for services provided
(See Note 6). As a result of the forward split 5,000,000 shares were
increased to 70,000,000 shares ($0.00007/share).
(E) Acquisition
Agreement
On
September 28, 2007, El Maniel International, Inc. consummated an agreement with
El Maniel Cigar Company, pursuant to which El Maniel Cigar Company exchanged all
of its members’ interest for 5,000,000 shares or approximately 100% of the
common stock of El Maniel International, Inc. The Company has
accounted for the transaction as a combination of entities under common control
and accordingly, recorded the merger at historical cost.
F-11
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
(F) Stock Split
On August
5, 2009, the Company's Board of Directors declared a fourteen-for-one stock
split which was distributed on August 5, 2009 to shareholders of
record. A total of 89,245,000 shares of common stock were
issued. All basic and diluted loss per share and average shares
outstanding information has been adjusted to reflect the aforementioned stock
split.
NOTE
5 COMMITMENTS
On
October 15, 2007, the Company entered into a consulting agreement to receive
administrative and other miscellaneous services. The Company is
required to pay $5,000 a month. This agreement was terminated
effective November 1, 2008.
NOTE
6 RELATED PARTY
TRANSACTIONS
For the
year ended September 30, 2009, a shareholder of the Company contributed services
having a fair value of $5,200 (See Note 4(B)).
As of
September 30, 2008, a shareholder of the Company contributed services having a
fair value of $5,200 (See Note 4(B)).
For the
year ended September 30, 2009, a related party loaned the Company
$483. The Company entered into a written promissory note concerning
this obligation. The loan is noninterest bearing and payable on
demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0 (See Note 3).
For the
year ended September 30, 2007, the Company received $1,603 from a principal
stockholder. Pursuant to the terms of the loan, the loan is non interest bearing
and due on demand. As of September 30, 2008, the Company still owes $1,081 to
the principal shareholder (See Note 3).
During
December 2008, the Company received $518 from a relative of the principal
stockholder. Pursuant to the terms of the loan, the loan is noninterest bearing
and due on demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0 (See Note 3).
For the
period from July 24, 2007 (inception) through September 30, 2007 the shareholder
of the Company contributed services having a fair value of $971 (See Note
4(B)).
As of
September 30, 2007, the shareholder of the Company contributed cash of $100 to
cover the costs of setting up the subsidiary (See Note 4(C)).
F-12
EL
MANIEL INTERNATIONAL, INC. AND SUBSIDIARY
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30,
2009
On July
24, 2007, the Company issued 5,000,000 shares of common stock to its founders
having a fair value of $5,000 ($0.001/share) in exchange for services provided
(See Note 4 (D)). As a result of the forward split 5,000,000 shares were
increased to 70,000,000 shares ($0.0007/share).
During
2009, the Company had related party sales of $2,500.
NOTE
7 GOING
CONCERN
As
reflected in the accompanying financial statements, the Company is in the
development stage with minimal operations, used cash in operations of $232,203
from inception and has a net loss since inception of $251,981 for the period
from July 24, 2007 (inception) to September 30, 2009. In addition,
there is a working capital deficiency of $51,470 and stockholders’ deficiency of
$49,010 as of September 30, 2009. This raises substantial doubt about
its ability to continue as a going concern. The ability of the
Company to continue as a going concern is dependent on the Company’s ability to
raise additional capital and implement its business plan. The
financial statements do not include any adjustments that might be necessary if
the Company is unable to continue as a going concern.
Management
believes that actions presently being taken to obtain additional funding and
implement its strategic plans provide the opportunity for the Company to
continue as a going concern.
NOTE
8 SUBSEQUENT
EVENT
In
preparing these financial statements, the Company has evaluated events and
transactions for potential recognition or disclosure through December 23, 2009,
the date the financial statements were issued.
For the
year ended September 30, 2009, a non related party loaned the Company
$276. The loan is noninterest bearing and payable on demand. As of
September 30, 2009, the loan balance is $276 and is not in
default. This loan was repaid in October 2009 (see Note
3).
F-13
ITEM 9. CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Our
accountant is Webb & Company. P.A, independent certified public accountants.
We do not presently intend to change accountants. At no time have there been any
disagreements with such accountants regarding any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure.
ITEM 9A. CONTROLS AND PROCEDURES
Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out an evaluation, with the participation of the Company’s
management, including the Company’s Chief Executive Officer (“CEO”) and Chief
Accounting Officer (“CAO”) (the Company’s principal financial and accounting
officer), of the effectiveness of the Company’s disclosure controls and
procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the
end of the period covered by this report. Based upon that evaluation, the
Company’s CEO and CAO concluded that the Company’s disclosure controls and
procedures are effective to ensure that information required to be disclosed by
the Company in the reports that the Company files or submits under the Exchange
Act, is recorded, processed, summarized and reported, within the time periods
specified in the SEC’s rules and forms, and that such information is accumulated
and communicated to the Company’s management, including the Company’s CEO and
CAO, as appropriate, to allow timely decisions regarding required
disclosure.
Internal
control over financial reporting is a process to provide reasonable assurance
regarding the reliability of consolidated financial reporting and the
preparation of financial statements for external purposes in accordance with
U.S. generally accepted accounting principles. There has been no change in the
Company’s internal control over financial reporting during the quarter ended
September 30, 2009 that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial
reporting.
ITEM 9B. OTHER INFORMATION
None.
PART
III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS,
PROMOTERS AND CONTROL PERSONS: COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE
ACT
We have
two Directors and Officers as follows:
|
Name
|
Age
|
Positions
and Offices Held
|
|
Barbara
Tejeda
|
40
|
Chairman,
President, and Chief Executive Officer
|
|
Rafael
Tejeda
|
48
|
Secretary
|
Barbara Tejeda,
39, President. Ms. Tejeda has
been our Chairman of the Board, President, Chief Executive Officer and Chief
Financial Officer since inception. Since September 2005 she has been a Front End
Supervisor, Inventory Control Manager and Sales Clerk at Bed Bath and Beyond in
North Carolina. In such capacity she was responsible for maintaining lane
accountability, daily audit, deposit of daily cash flow as well as to train new
staff and assist with yearly cycle count/inventory audits of other properties.
From 2001 to 2004 she worked as a Secretary for Raleigh LDS Institute in North
Carolina. In such capacity her responsibilities included providing single point
of contact for the facilities, updating monthly calendar and creating formats
for generating report, and general administrative/clerical functions. Also from
1998 to 2000 she was the sole proprietor of New Wave Cigar a retail cigar
company established in Raleigh, North Carolina in May 1995. Ms. Tejeda’s
responsibilities included managing the daily operations, developing marketing
strategies, sale of Dominican Cigars, and Coordinating Cigar and wine tasting
events. In addition, she designed and supervised the customer cigar boxes for
the 1999 Hudson Belk golf tournament which New Wave Cigars sponsored along side
Continental Cigar Importers. Moreover, she has a fashion design and marketing
background and has taken various courses and seminars on leadership, and
customer satisfaction. Prior to 2001 she held various positions at well known
merchandise companies and hotels such as Dress Barn, Springhill Suites,
Fairfield Inn, Summit Hospitality, and Kay-Bee Toys.
-7-
Rafael Tejeda,
47, Secretary. Mr. Tejeda has
been our Secretary since inception. He is an executive and businessman with
experience in the hotel industry in the areas of operations, marketing and
public relations. He has held several managerial/Executive positions at various
well-known hotels in the Dominican Republic, Miami and New York which include
Howard Johnson, Bavaro, AMHSA and others. Since September 2004 he has
been a TV Show Producer and host for a local TV Program “Robert en Vivo” In
Santo Domingo which provides a national and international social and financial
analysis as well as interviewing prominent individuals. From April
2002 to August 2004 he was a TV Show Producer and Host of a local TV program “En
Resumidas Cuentas”, a daily entertainment and interview family
program. He is fluent in Spanish.
Barbara
Tejeda is the sister in law of Rafael Acevedo Tejeda.
Term of
Office
Our
directors are appointed for a one-year term to hold office until the next annual
general meeting of our shareholders or until removed from office in accordance
with our bylaws. Our officers are appointed by our board of directors and hold
office until removed by the board.
Audit
Committee
We do not
have a standing audit committee of the Board of Directors. Management has
determined not to establish an audit committee at present because of our limited
resources and limited operating activities do not warrant the formation of an
audit committee or the expense of doing so. We do not have a financial
expert serving on the Board of Directors or employed as an officer based on
management’s belief that the cost of obtaining the services of a person who
meets the criteria for a financial expert under Item 401(e) of Regulation S is
beyond its limited financial resources and the financial skills of such an
expert are simply not required or necessary for us to maintain effective
internal controls and procedures for financial reporting in light of the limited
scope and simplicity of accounting issues raised in its financial statements at
this stage of its development.
Certain Legal
Proceedings
No
director, nominee for director, or executive officer of the Company has appeared
as a party in any legal proceeding material to an evaluation of his ability or
integrity during the past five years.
Compliance With Section
16(A) Of The Exchange Act.
Section
16(a) of the Exchange Act requires the Company’s officers and directors, and
persons who beneficially own more than 10% of a registered class of the
Company’s equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and are required to
furnish copies to the Company. To the best of the Company’s knowledge, any
reports required to be filed were timely filed in fiscal year ended September
30, 2009.
Code of
Ethics
The
company has adopted a Code of Ethics applicable to its Chief Executive Officer
and Chief Financial Officer. This Code of Ethics was previously filed on January
7, 2009 as an exhibit to the Form 10K/A.
ITEM 11. EXECUTIVE COMPENSATION
Compensation of Executive
Officers
The
following summary compensation table sets forth all compensation awarded to,
earned by, or paid to the named executive officers paid by us during the fiscal
years ended September 30, 2009 and 2008 in all capacities for the accounts of
our executives, including the Chief Executive Officer (CEO) and Chief Financial
Officer (CFO):
-8-
SUMMARY
COMPENSATION TABLE
|
Name
and
Principal
Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive Plan Compensation ($)
|
Non-Qualified
Deferred Compensation Earnings
($)
|
All
Other Compensation
($)
|
Totals
($)
|
||||||||||||||||||||||||
|
Barbara
Tejeda
Founder,
Chairman,
and
Chief Executive
|
2009
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
Officer
|
2008
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
Rafael Tejeda,
|
2009
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
Secretary,
Director
|
2008
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
Employment
Agreements
We do not
have any employment agreements in place with our sole officer and
director.
Compensation of
Directors
Directors
do not receive any compensation for their services as directors. The Board of
Directors has the authority to fix the compensation of directors. No amounts
have been paid to, or accrued to, directors in such capacity.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The
following table sets forth each person known by us to be the beneficial owner of
five percent or more of the Company's Common Stock, all directors individually
and all directors and officers of the Company as a group. Except as noted, each
person has sole voting and investment power with respect to the shares
shown.
|
Name
and Address of
Beneficial
Owner
|
Amount
of
Beneficial
Ownership
|
Percentage
of
Class
|
|
Barbara
Tejeda
7424
Brighton Village Drive
Raleigh,
NC 27616
|
70,000,000
|
72.83%
|
|
Rafael
Tejeda
Porfirio
Herrera #34, Apto. 304,
Evaristo
Morales, Santo Domingo
|
0
|
0%
|
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTION, AND DIRECTOR INDEPENDENCE
For the
year ended September 30, 2009, a shareholder of the Company contributed services
having a fair value of $5,200.
For the
year ended September 30, 2009, a related party loaned the Company
$483. The Company entered into a written promissory note concerning
this obligation. The loan is noninterest bearing and payable on
demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0.
-9-
For the
year ended September 30, 2007, the Company received $1,603 from a principal
stockholder. Pursuant to the terms of the loan, the loan is non interest bearing
and due on demand. As of September 30, 2009, the Company still owes $1,081 to
the principal shareholder.
During
December 2008, the Company received $518 from a relative of the principal
stockholder. Pursuant to the terms of the loan, the loan is noninterest bearing
and due on demand. As of September 30, 2009, the loan balance has been repaid
and the loan payable is $0.
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND
SERVICES
Audit
Fees
For the
Company’s fiscal years ended September 30, 2009 and 2008, we were billed
approximately $15,126 and $12,030 for professional services rendered for the
audit and review of our financial statements.
Audit Related
Fees
There
were no fees for audit related services for the years ended September 30, 2009
and 2008.
Tax Fees
For the
Company’s fiscal years ended September 30, 2009 and 2008, we were not billed for
professional services rendered for tax compliance, tax advice, and tax
planning.
All Other
Fees
The
Company did not incur any other fees related to services rendered by our
principal accountant for the fiscal years ended September 30, 2009 and
2008.
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Effective
May 6, 2003, the Securities and Exchange Commission adopted rules that require
that before our auditor is engaged by us or our subsidiaries to render any
auditing or permitted non-audit related service, the engagement be:
-approved
by our audit committee; or
-entered
into pursuant to pre-approval policies and procedures established by the audit
committee, provided the policies and procedures are detailed as to the
particular service, the audit committee is
informed of each service, and such policies and procedures do not include
delegation of the audit committee's responsibilities to management.
We do not
have an audit committee. Our entire board of directors pre-approves
all services provided by our independent auditors. The pre-approval process has
just been implemented in response to the new rules. Therefore, our board of
directors does not have records of what percentages of the above
fees were pre-approved. However, all of the above services and fees
were reviewed and approved by the entire board of directors either before or
after the respective services were rendered.
-10-
PART
IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT
SCHEDULES.
a)
Documents filed as part of this Annual Report
1.
Consolidated Financial Statements
2.
Financial Statement Schedules
3.
Exhibits
| Exhibits # | Title |
|
14
|
The
Code of Ethics was previously filed on January 7, 2009 as an exhibit to
the Form 10K/A.
|
|
31.1
|
Certification
of President, Chief Executive Officer, Chief Financial Officer, Chairman
of the Board of Directors Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
|
32.1
|
Certification
of President, Chief Executive Officer, Chief Financial Officer, Chairman
of the Board of Directors Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
-11-
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, there unto duly authorized.
|
EL
MANIEL INTERNATIONAL, INC.
|
|
|
By:
|
/s/Barbara
Tejeda
|
|
Founder,
Chairman,
Chief
Executive Officer,
Chief
Financial Officer,
Chief
Accounting Officer and Director
|
|
Dated
|
January
8, 2010
|
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
|
Name
|
Title
|
Date
|
|
|
/s/
Barbara Tejeda
|
Founder,
Chairman, Chief Executive Officer,
|
January
8, 2010
|
|
|
Barbara
Tejeda
|
Chief
Financial Officer, Chief Accounting Officer and Director
|
-12-