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EX-31.1 - EXHIBIT 31.1 - TRANSIT MANAGEMENT HOLDING CORP | transit10q22810x31_4142010.htm |
EX-32.1 - EXHIBIT 32.1 - TRANSIT MANAGEMENT HOLDING CORP | transit10q22810x32_4142010.htm |
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
[x]
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the
Quarterly period ended February 28, 2010
[]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Commission File No.
000-53106
TRANSIT
MANAGEMENT HOLDING CORP.
(Exact
Name of Small Business Issuer as specified in its charter)
Colorado
|
26-0812035
|
(State
or other jurisdiction
|
(IRS
Employer File Number)
|
of
incorporation)
|
3176
South Peoria Ct.
|
|
Aurora, Colorado
|
80014
|
(Address
of principal executive offices)
|
(zip
code)
|
(303)
596-0566
(Registrant's
telephone number, including area code)
Indicate
by check mark whether the registrant: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 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 [ ]
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(Section 232.405 of
this chapter) during the preceding 12 months(or such shorter period that the
registrant was required to submit and post such files. Yes [] No [
]
Indicate
by check mark whether the registrant is a large accelerated filer, a
non-accelerated filer, or a smaller reporting company. See definitions of “large
accelerated filer,” “accelerated filer,” and “small reporting company” in Rule
12b-2 of the Exchange Act.
Large
accelerated filer []
|
Accelerated
filer []
|
Non-accelerated
filer [] (Do not check if a smaller reporting company)
|
Smaller
reporting company [X]
|
As
of February 28, 2010, registrant had outstanding 22,225,200 shares of the registrant's
common stock.
FORM
10-Q
TRANSIT
MANAGEMENT HOLDING CORP.
TABLE
OF CONTENTS
Page
|
|
PART
I FINANCIAL INFORMATION
|
|
Item
1. Financial Statements for the period ended February 28,
2010
|
3
|
Consolidated
Balance Sheet
|
5
|
Consolidated
Statements of Operations
|
6
|
Consolidated
Statement of Shareholders' Equity
|
7
|
Consolidated
Statements of Cash Flows
|
8
|
Notes
To Financial Statements
|
9
|
Item
2. Management’s Discussion and Analysis and Plan of
Operation
|
10
|
Item
3. Quantitative and Qualitative Disclosures About Market
Risk
|
13
|
Item
4. Controls and Procedures
|
14
|
Item
4T. Controls and Procedures
|
14
|
PART
II OTHER INFORMATION
|
|
Item
1. Legal Proceedings
|
14
|
Item
1A. Risk Factors
|
14
|
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds
|
18
|
Item
3. Defaults Upon Senior Securities
|
18
|
Item
4. Submission of Matters to a Vote of Security Holders
|
18
|
Item
5. Other Information
|
18
|
Item
6. Exhibits
|
18
|
Signatures
|
19
|
-
2 -
PART
I FINANCIAL INFORMATION
References
in this document to "us," "we," or "Company" refer to TRANSIT MANAGEMENT HOLDING
CORP. and our subsidiary, Transit Management, Inc.
ITEM
1. FINANCIAL STATEMENTS
TRANSIT
MANAGEMENT HOLDING CORP.
CONSOLIDATED
FINANCIAL STATEMENTS
(Unaudited)
Quarter
Ended February 28, 2010
-
3 -
Transit
Management Holding Corp.
Consolidated
Financial Statements
(Unaudited)
TABLE
OF CONTENTS
Page
|
|
CONSOLIDATED
FINANCIAL STATEMENTS
|
|
Consolidated
balance sheet
|
5
|
Consolidated
statements of operations
|
6
|
Consolidated
statement of shareholders' equity
|
7
|
Consolidated
statements of cash flows
|
8
|
Notes
to consolidated financial statements
|
9
|
-
4 -
TRANSIT
MANAGEMENT HOLDING CORP.
CONSOLIDATED
BALANCE SHEET
(A Development Stage
Company)
Unaudited
|
Audited
|
|||||||
February
|
November
|
|||||||
28, 2010 | 30, 2009 | |||||||
ASSETS
|
||||||||
Current
Assets:
|
||||||||
Cash
|
$ | 4,195 | $ | 730 | ||||
Accounts
receivable - related party
|
(48 | ) | 6,610 | |||||
Total
current assets
|
4,147 | 7,340 | ||||||
TOTAL
ASSETS
|
$ | 4,147 | $ | 7,340 | ||||
LIABILITIES
AND SHAREHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
||||||||
LIABILITIES
|
||||||||
Accounts
payable
|
$ | 9,512 | $ | 15,575 | ||||
Accounts
payable - related party
|
11,500 | 11,500 | ||||||
Interest
payable - related party
|
3,785 | 3,163 | ||||||
Payroll
taxes payable
|
968 | 968 | ||||||
Other
current liablities - related party
|
- | - | ||||||
Customer
deposits
|
5,000 | 5,000 | ||||||
Current
portion notes payable - related party
|
43,500 | 33,000 | ||||||
Total
current liabilities
|
74,265 | 69,206 | ||||||
Long-Term
Liabilities
|
- | - | ||||||
TOTAL
LIABILITIES
|
$ | 74,265 | $ | 69,206 | ||||
SHAREHOLDERS'
EQUITY
|
||||||||
Preferred
stock, par value $.10 per share; Authorized
|
||||||||
1,000,000
shares; issued and outstanding -0- shares.
|
- | |||||||
Common
Stock, par value $.001 per share; Authorized
|
||||||||
50,000,000
shares; issued and outstanding 22,225,200 shares.
|
22,225 | 22,225 | ||||||
Capital
paid in excess of par value
|
40,886 | 40,886 | ||||||
Deficit
accumulated during the development stage
|
(133,229 | ) | (124,977 | ) | ||||
TOTAL
SHAREHOLDERS' EQUITY
|
(70,118 | ) | (61,866 | ) | ||||
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$ | 4,147 | $ | 7,340 |
See
Accompanying Notes To These Unaudited Financial Statements.
-
5 -
Transit
Management Holding Corp.
Unaudited
Statement Of Operations
(A
Development Stage Company)
3
Months Ended |
3
Months Ended |
August
15, 2007 (inception) |
||||||||||
Revenue
|
$ | 3,842 | $ | 8,049 | $ | 74,231 | ||||||
Operating
expenses
|
||||||||||||
Accounting
|
2,750 | 2,500 | 21,270 | |||||||||
Automobile
reimbursement
|
- | - | 1,255 | |||||||||
Bank
charges
|
- | - | 135 | |||||||||
Consulting
|
- | - | 29,528 | |||||||||
Legal
|
- | - | 40,350 | |||||||||
Maintenance
Supplies
|
1,204 | 321 | 7,293 | |||||||||
Management
fees
|
2,000 | 5,000 | 67,000 | |||||||||
Meals
& entertainment
|
- | - | 1,318 | |||||||||
Office
|
(44 | ) | - | 9,436 | ||||||||
Stock
transfer fees
|
- | - | 6,789 | |||||||||
Taxes
- payroll
|
311 | 819 | 6,550 | |||||||||
Total
General and administrative expenses
|
6,221 | 8,640 | 190,924 | |||||||||
(Loss)
before other expenses
|
(2,379 | ) | (591 | ) | (116,693 | ) | ||||||
Other
expenses - interest
|
(5,873 | ) | (360 | ) | (16,536 | ) | ||||||
Net Income
(Loss)
|
$ | (8,252 | ) | $ | (951 | ) | $ | (133,229 | ) | |||
Basic
(Loss) Per Share
|
$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | |||
Weighted
Average Common Shares
|
||||||||||||
Outstanding
|
22,225,200 | 22,066,100 | 22,225,200 |
See
Accompanying Notes To These Unaudited Financial Statements.
-
6 -
Transit
Management Holding Corp.
Consolidated
Statement of Shareholders' Equity
(A
Development Stage Company)
Number
Of
|
Capital
Paid
|
Retained
|
||||||||||||||||||
Common
|
Common
|
in
Excess
|
Earnings
|
|||||||||||||||||
Shares Issued (1)
|
Stock
|
of Par Value
|
(Deficit)
|
Total
|
||||||||||||||||
Balance
at August 15, 2007 (Inception)
|
- | $ | - | $ | - | $ | - | $ | - | |||||||||||
August
15, 2007 issued 21,000,000 shares
|
||||||||||||||||||||
for services
val. at $21,000 or $.001 per share
|
21,000,000 | 21,000 | - | 21,000 | ||||||||||||||||
August
16, 2007 issued 33,000
|
||||||||||||||||||||
shares
of par value $.001 common stock
|
||||||||||||||||||||
for
cash of $33 or $.001 per share.
|
33,000 | 33 | - | 33 | ||||||||||||||||
August
16, 2007 issued 1,028,000
|
||||||||||||||||||||
shares
of par value $.001 common stock
|
||||||||||||||||||||
for
services valued at $1,028 or $.001 per share
|
1,028,000 | 1,028 | - | 1,028 | ||||||||||||||||
October
19, 2007 issued 10,200
|
||||||||||||||||||||
shares
of par value $.001 common stock
|
||||||||||||||||||||
for
cash of $2,550 as part of a private
|
||||||||||||||||||||
placement
or $.25 per share.
|
10,200 | 10 | 2,540 | 2,550 | ||||||||||||||||
November
27, 2007 issued 154,000
|
||||||||||||||||||||
shares
of par value $.001 common stock
|
||||||||||||||||||||
for
cash of $38,650 as part of a private
|
||||||||||||||||||||
placement
or $.25 per share.
|
154,000 | 154 | 38,346 | 38,500 | ||||||||||||||||
Net
Income (Loss)
|
- | - | - | (68,694 | ) | (68,694 | ) | |||||||||||||
Balance
at November 30, 2007
|
22,225,200 | 22,225 | 40,886 | (68,694 | ) | (5,583 | ) | |||||||||||||
Net
Income (Loss)
|
- | - | - | (22,392 | ) | (22,392 | ) | |||||||||||||
Balance
at November 30, 2008
|
22,225,200 | 22,225 | 40,886 | (91,086 | ) | (27,975 | ) | |||||||||||||
Net
Income (Loss)
|
- | - | - | (33,891 | ) | (33,891 | ) | |||||||||||||
Balance
at November 30, 2009
|
22,225,200 | 22,225 | 40,886 | (124,977 | ) | (61,866 | ) | |||||||||||||
Net
Income (Loss)
|
- | - | - | (8,252 | ) | (8,252 | ) | |||||||||||||
Balance
at February 28, 2010 (unaudited)
|
22,225,200 | $ | 22,225 | $ | 40,886 | (133,229 | ) | $ | (70,118 | ) |
See
Accompanying Notes To These Unaudited Financial Statements.
-
7 -
Transit
Management Holding Corp.
Consolidated
Unaudited Statement Of Cash Flows
(A
Development Stage Company)
3
Months Ended |
3
Months Ended |
August
15, 2007 (inception) |
||||||||||
Net
Income (Loss)
|
$ | (8,252 | ) | $ | (951 | ) | $ | (133,229 | ) | |||
Adjustments
to reconcile decrease in net assets to net cash
|
||||||||||||
provided
by operating activities:
|
||||||||||||
Stock
issued for services
|
- | - | 22,028 | |||||||||
Interest
acretion
|
5,250 | - | 12,750 | |||||||||
(Increase)
Decrease in accounts receivable
|
6,658 | 2,584 | 48 | |||||||||
Increase
(decrease) in accounts payable
|
(6,063 | ) | (194 | ) | 21,012 | |||||||
Increase
in payroll taxes payable
|
- | - | 968 | |||||||||
Increase
(Decrease) in other current liabilities
|
- | (1,614 | ) | - | ||||||||
Increase
in customer deposits
|
- | - | 5,000 | |||||||||
Increase
in interest payable
|
622 | 360 | 3,785 | |||||||||
Net
cash (used) in operation activities
|
(1,785 | ) | 185 | (67,638 | ) | |||||||
Cash
flows from investing activities:
|
||||||||||||
Net
cash (used) in investing activities
|
- | - | - | |||||||||
Net
cash (used) in investing activities
|
- | - | - | |||||||||
Cash
flows from financing activities:
|
||||||||||||
Issuance
of common stock
|
- | - | 41,083 | |||||||||
Notes
payable
|
5,250 | - | 30,750 | |||||||||
Net
cash provided from financing activities
|
5,250 | - | 71,833 | |||||||||
Net
increase in cash
|
3,465 | 185 | 4,195 | |||||||||
Cash
at beginning of period
|
730 | 7,399 | - | |||||||||
Cash
at end of period
|
$ | 4,195 | $ | 7,584 | $ | 4,195 | ||||||
Supplementary
Disclosure Of Cash Flow Information:
|
||||||||||||
Stock
issued for services
|
$ | - | $ | - | $ | 22,028 | ||||||
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
Cash
paid for income taxes
|
$ | - | $ | - | $ | - |
See
Accompanying Notes To These Unaudited Financial Statements.
-
8 -
Transit
Management Holding Corp.
Notes
To Unaudited Financial Statements
For
The Three Month Interim Period Ended February 28, 2010
Note 1 - Unaudited Financial
Information
The
unaudited financial information included for the three
month interim period ended February 28, 2010 was taken from the books
and records without audit. However, such information reflects all adjustments,
consisting only of normal recurring adjustments, which in the opinion of
management are necessary to reflect properly the results of the interim periods
presented. The results of operations for the three month interim period
ended February 28, 2010 are not necessarily indicative of the results expected
for the fiscal year ended November 30, 2010.
Note 2 - Financial
Statements
For a
complete set of footnotes, reference is made to the Company’s Report on Form
10-KSB for the year ended November 30, 2009 as filed with the Securities and
Exchange Commission and the audited financial statements included
therein.
-
9 -
ITEM
2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION
The
following discussion of our financial condition and results of operations should
be read in conjunction with, and is qualified in its entirety by, the
consolidated financial statements and notes thereto included in, Item 1 in this
Quarterly Report on Form 10-Q. This item contains forward-looking statements
that involve risks and uncertainties. Actual results may differ materially from
those indicated in such forward-looking statements.
Forward-Looking
Statements
This
Quarterly Report on Form 10-Q and the documents incorporated herein by reference
contain forward-looking. Such forward-looking statements are based on current
expectations, estimates, and projections about our industry, management beliefs,
and certain assumptions made by our management. Words such as "anticipates",
"expects", "intends", "plans", "believes", "seeks", "estimates", variations of
such words, and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties, and assumptions
that are difficult to predict; therefore, actual results may differ materially
from those expressed or forecasted in any such forward-looking statements.
Unless required by law, we undertake no obligation to update publicly any
forward-looking statements, whether as a result of new information, future
events, or otherwise. However, readers should carefully review the risk factors
set forth herein and in other reports and documents that we file from time to
time with the Securities and Exchange Commission, particularly the Report on
Form 10-K, Form 10-Q and any Current Reports on Form 8-K.
Overview
and History
Transit
Management Holdings, Inc. was organized as a corporation under the laws of the
State of Colorado on August 15, 2007.
Our main
focus is the management of property assets along high density corridors and
transit areas which are currently being developed and re-developed near Light
Rail transportation lines in the Denver, Colorado metropolitan
area. We have been managing retail and residential property since
1999 as a sole proprietorship under our President, Mr. Zueger, although not with
the same focus. Therefore, we consider ourselves to be a new
company. We will not acquire or own any properties, but will only
manage properties for fees paid to us by the owner of the managed
property.
In
August, 2007, we issued a total of 22,061,000 restricted common shares at a
price of $0.001 for cash and past services.
In
November, 2007, we completed a private placement offering of our common shares
under the provisions of Rule 504 and analogous Colorado securities laws. We
raised a total of $41,050 in this private placement offering and sold a total of
164,200 shares.
Our
headquarters are located at 3176 South Peoria Ct., Aurora, Colorado
80014. Our phone number at our headquarters is (303)596-0566. Our fiscal year end is
November 30th.
Results
of Operations
The
following discussion involves our results of operations for the three months
ending February 28, 2010, for the three months ending February 29,
2009 and the period from inception through February 28,
2010.
For the
three months ended February 28, 2010, we had total revenues of $3,890. For the
three months ended February 29, 2009, we had total revenues of $8,049. From
inception through February 28, 2010, we had total revenues of
$74,279.
-
10 -
Our operating expenses consisted
primarily of general and administrative expenses. General and administrative
expenses for the three months ended February 28, 2010 were $6,265. General and
administrative expenses for the three months ended February 29, 2009 were
$8,640. General and administrative expenses were $190,968 for the
period from inception through February 28, 2010. The major components of these
general and administrative expenses were payments to consultants, professional
fees, and maintenance supplies. While our general and administrative expenses
will continue to be our largest expense item, we have brought this expense in
line with our revenues for the three months ending February 28,
2010 and we believe that in the coming fiscal year we can control
this expense as we reduce payments to consultants and professional
fees.
We had a net loss of $8,204 for the
three months ended February 28, 2010. We had a net loss of $951 for the three
months ended February 29, 2009. We had a net loss of $133,181 for the period
from inception through February 28, 2010.
We believe that overhead cost in
current operations should remain fairly constant as revenues develop. Each
dollar of revenue will have minimal offsetting overhead cost. If we can develop
sufficient revenues, we could continue to be profitable for the remainder of the
fiscal year.
Liquidity and Capital
Resources
As of February 28, 2010, we had cash or
cash equivalents of $4,195. As of February 28, 2009, we had cash or cash
equivalents of $7,584.
Net cash used in operating
activities was $1,785 for the three months ended February 28,
2010. Net cash provided by operating activities was $185 for the
three months ended February 29, 2009. Net cash used in operating activities was
$67,638 for the period from inception through February 28, 2010. We anticipate
that overhead costs in current operations will remain fairly constant as we
develop revenue.
Cash flows used in investing activities
were $-0- for all relevant periods.
Cash flows provided by financing
activities were $5,250 for the three months ended February 28, 2010. Cash flows
provided by financing activities were $-0- for the three months ended February
29, 2009. Cash flows provided from financing activities was $71,833 for the
period from inception through February 28, 2010. All cash flows were related to
our recent securities sales activity and to loans.
Over the
next twelve months we do not expect any material our capital costs to develop
operations. We plan to buy certain items of office equipment to be used in our
operations.
We
believe that we have sufficient capital in the short term for our current level
of operations. This is because we believe that we can attract sufficient product
sales and services within our present organizational structure and resources to
become profitable in our operations. Additional resources would be needed to
expand into additional locations, which we have no plans to do at this time. We
do not anticipate needing to raise additional capital resources in the next
twelve months In the event that we need additional capital, Mr.Zueger has agreed
to loan such funds as may be necessary through December 31, 2010 for working
capital purposes.
Our
principal source of liquidity will be our operations. We expect variation in
revenues to account for the difference between a profit and a loss. Also
business activity is closely tied to the U.S. economy, particularly the economy
in Denver, Colorado. Our ability to achieve and maintain profitability and
positive cash flow is dependent upon our ability to successfully develop a real
estate management business and our ability to generate revenues.
In
any case, we try to operate with minimal overhead. Our primary activity will be
to seek to develop clients for our services and, consequently, our sales. If we
succeed in developing clients for our services and generating sufficient sales,
we will become profitable. We cannot guarantee that this will ever occur. Our
plan is to build our company in any manner which will be
successful.
-
11 -
Plan
of Operation
We have
identified several potential properties in the Denver, Colorado and surrounding
suburban area which are planned to be developed or re-developed and re-zoned to
high density developments along light rail mass transit stations requiring what
we believe is a higher level of expertise in property management. There are a
total of forty-eight planned Light Rail Mass Transit Stations.
Our
initial plan is to service, maintain and manage real estate properties
surrounding the forty-eight planned Light Rail Mass Transit Stations around
Denver, Colorado and surrounding suburbs. We offer specialized
service to landowners to help them rezone land, identify and screen real estate
development opportunities and to manage the projects once they have been
constructed. We will not acquire any properties for our own account, but will
provide consulting services to our clients and will be available to manage the
resulting properties, all for fees.
Once we
have successfully developed our plan to service, maintain and manage these
specialized real estate properties in Denver, Colorado and
surrounding suburbs, we plan to develop specialized marketing for transportation
development initiatives many of the front range cities are adopting in
Colorado.
Our plan
for the twelve months beginning January 1, 2010 is to operate at a profit or at
break even. We are currently in operation and have been since our inception. We
have only been profitable for the three months ended February 29,
2008.
Currently,
we are conducting business in only one location in the Denver Metropolitan area.
We have no plans to expand into other locations or areas. The timing of the
completion of the milestones needed to become profitable is not directly
dependent on anything except our ability to develop sufficient
revenues.
Our
principal cost will be marketing our services. At this point, we do not know the
scope of our potential marketing costs but will use our existing resources to
market our services. Our resources consist of our available cash and advances
from Mr. Zueger, who has agreed to loan such funds as may be necessary through
December 31, 2010 for working capital purposes.
We
believe that we can become profitable for the fiscal year, given sufficient
sales. We believe that the timing of the completion of the milestones needed to
become profitable can be achieved as we are presently organized with sufficient
business.
Other
than the shares offered by our last offering and advances from Mr. Zueger, no
other source of capital has been identified or sought.
If we are
not successful in our proposed operations we will be faced with several
options:
1.
|
Cease
operations and go out of business;
|
2.
|
Continue
to seek alternative and acceptable sources of
capital;
|
3.
|
Bring
in additional capital that may result in a change of control;
or
|
4.
|
Identify
a candidate for acquisition that seeks access to the public marketplace
and its financing sources.
|
Currently,
we believe that we have sufficient capital or access to capital to implement our
proposed business operations or to sustain them for the next twelve months. In
the event that we need additional capital, Mr. Zueger has agreed to loan such
funds as may be necessary through December 31, 2010 for working capital
purposes.
If we can
sustain profitability, we could operate at our present level
indefinitely.
To date,
we have never had any discussions with any possible acquisition candidate nor
have we any intention of doing so.
-
12 -
Proposed
Milestones to Implement Business Operations
At the
present time, we are located in one location in Littleton, Colorado. To try to
operate at a break-even level based upon our level of proposed business
activity, we believe that we must generate approximately $35,000 in revenue per
year. However, if our forecasts are inaccurate, we may need to raise additional
funds. In the event that we need additional capital, Mr. Zueger has agreed to
loan such funds as may be necessary through December 31, 2010 for working
capital purposes.
The
results of our proposed operations will depend, among other things, upon our
ability to successfully provide management of property assets along high density
corridors and transit areas which are currently being developed and re-developed
near Light Rail transportation lines in the Denver, Colorado metropolitan
area. Further, there is the possibility that our proposed operations
will not generate income sufficient to meet operating expenses or will generate
income and capital appreciation, if any, at rates lower than those anticipated
or necessary to sustain the investment. Our operations may also be affected by
factors which are beyond our control, principally general market conditions and
changing client preferences. Any of these problems, or a combination
thereof, could have affect on our viability as an entity. We may never become
profitable, fail as an organization, and our investors could lose some or all of
their investment.
It
should be noted that we do not have any history of operations and have not yet
generated substantial revenues. We are in the process of developing
operations. During the first nine months of 2010 we plan to market our services
through the contacts of our President, Mr. Zueger. We may also use newspaper
advertising. However, we primarily plan to rely on the possibility of referrals
from clients and will strive to satisfy our clients. We believe that referrals
will be an effective form of advertising because of the quality of service that
we bring to clients. We believe that satisfied clients will bring more and
repeat clients.
To the
extent that management is unsuccessful in keeping expenses in line with income,
failure to affect the events and goals listed herein would result in a general
failure of the business. This would cause management to consider liquidation or
merger. We have no plans for any type of business combination.
We
believe that we can be profitable or at break even at the end of the current
fiscal year, assuming sufficient sales. Based upon our current plans, we have
adjusted our operating expenses so that cash generated from operations and from
working capital financing is expected to be sufficient for the foreseeable
future to fund our operations at our currently forecasted levels. We expect to
incur operating losses in future periods because we will be incurring expenses
and not generating sufficient revenues. We expect approximately $35,000 in
operating costs over the next twelve months. We cannot guarantee that we will be
successful in generating sufficient revenues or other funds in the future to
cover these operating costs. Failure to generate sufficient revenues or
additional financing when needed could cause us to go out of
business.
In the
event that we need additional capital, Mr. Zueger has agreed to loan such funds
as may be necessary through December 31, 2010 for working capital purposes.
Otherwise, no commitments to provide additional funds have been made by
management or current shareholders. There is no assurance that additional funds
will be made available to us on terms that will be acceptable, or at all, if and
when needed. We expect to continue to generate and increase sales, but there can
be no assurance we will generate sales sufficient to continue operations or to
expand.
In the
next 12 months, we do not intend to spend any material funds on research and
development and do not intend to purchase any large
equipment.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
None.
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ITEM
4. CONTROLS AND PROCEDURES
Not
applicable
ITEM
4T. CONTROLS AND PROCEDURES
As of the
end of the period covered by this report, based on an evaluation of our
disclosure controls and procedures (as defined in Rules 13a -15(e) and
15(d)-15(e) under the Exchange Act), our Chief Executive Officer and the Chief
Financial Officer has concluded that our disclosure controls and procedures are
effective to ensure that information required to be disclosed by us in our
Exchange Act reports is recorded, processed, summarized, and reported within the
applicable time periods specified by the SEC’s rules and forms.
There
were no changes in our internal controls over financial reporting that occurred
during our most recent fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
This
report does not include an attestation report of the company’s registered public
accounting firm regarding internal control over financial reporting. Identified
in connection with the evaluation required by paragraph (d) of Rule 240.13a-15
or Rule 240.15d-15 of this chapter that occurred during the registrant’s last
fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting.
PART
II. OTHER INFORMATION
ITEM
1. LEGAL PROCEEDINGS
There are
no legal proceedings, to which we are a party, which could have a material
adverse effect on our business, financial condition or operating
results.
ITEM
1A. RISK FACTORS
You
should carefully consider the risks and uncertainties described below; and all
of the other information included in this document. Any of the following risks
could materially adversely affect our business, financial condition or operating
results and could negatively impact the value of your investment.
You
should carefully consider the risks and uncertainties described below; and all
of the other information included in this document. Any of the following risks
could materially adversely affect our business, financial condition or operating
results and could negatively impact the value of your investment.
You
should carefully consider the risks and uncertainties described below and the
other information in this document before deciding to invest in shares of our
common stock.
The
occurrence of any of the following risks could materially and adversely affect
our business, financial condition and operating result. In this case, the
trading price of our common stock could decline and you might lose all or part
of your investment.
Risks
Related to Our Business and Industry
We
have a limited history of operations and have only been profitable in the first
three months of fiscal year 2008. However, we have negative
stockholders equity.
We were
formed as a Colorado business entity on August 15, 2007. At the present time, we
have a limited history of operations. We were profitable in the first three
months of fiscal year 2008. However, there can be no guarantee that we will ever
be profitable in the future. From our inception on August 15, 2007 through
February 28, 2010, we generated $74,279 in revenue. We had a net loss of
$133,181 for this period. For the three months ended February 28, 2010, we
generated $3,890 in revenue. We had a net loss of $8,204 for this
period. At February 28, 2010 we had a negative stockholders’ equity
of $70,070.
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Because
we had incurred operating losses from our inception, our accountants have
expressed doubts about our ability to continue as a going concern.
For the
period ended November 30, 2009, our accountants have expressed doubt about our
ability to continue as a going concern as a result of our continued net losses.
Our ability to achieve and maintain profitability and positive cash flow is
dependent upon:
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our ability to increase operations;
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our ability to locate clients who will purchase our management services;
and
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our ability to generate revenues.
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Based
upon current plans, we may incur operating losses in future periods because we
may, from time to time, be incurring expenses but not generating sufficient
revenues. We expect approximately $30,000 in operating costs over the next
twelve months. We cannot guarantee that we will be successful in generating
sufficient revenues or other funds in the future to cover these operating costs.
Failure to generate sufficient revenues will cause us to go out of
business.
We
have a lack of liquidity and will need additional financing in the future.
Additional financing may not be available when needed, which could delay our
development or indefinitely postponed.
We are
only minimally capitalized. Because we are only minimally capitalized, we expect
to experience a lack of liquidity for the foreseeable future in our proposed
operations. We will adjust our expenses as necessary to prevent cash flow or
liquidity problems. However, we expect we will need additional financing of some
type, which we do not now possess, to fully develop our operations. We expect to
rely principally upon our ability to raise additional financing, the success of
which cannot be guaranteed. We will look at both equity and debt financing,
including loans from our principal shareholder. However, at the present time, we
have no definitive plans for financing in place, other than the funds which may
be loaned to us by Mr. Zueger, our President. In the event that we need
additional capital, Mr. Zueger has agreed to loan such funds as may be necessary
through December 31, 2010 for working capital purposes. To the extent that we
experience a substantial lack of liquidity, our development in accordance with
our proposed plan may be delayed or indefinitely postponed, our operations could
be impaired, we may never become profitable, fail as an organization, and our
investors could lose some or all of their investment.
As
a company with limited operating history, we are inherently a risky investment.
An investor could lose his entire investment.
We have a
limited operating history. Because we are a company with a limited history, the
operations in which we engage in real estate management along high density
corridors and transit areas, is an extremely risky business. An investor could
lose his entire investment.
Our
operations are subject to our ability to successfully market our services. We
have no substantial history of being able to successfully market our services.
An investor could lose his entire investment.
Our
operations will depend, among other things, upon our ability to develop and to
market our real estate management services to clients. Further, there is the
possibility that our operations will not generate income sufficient to meet
operating expenses or will generate income, if any, at rates lower than those
anticipated or necessary to sustain the investment. An investor could lose his
entire investment.
There
are factors beyond our control which may adversely affect us. An investor could
lose his entire investment.
Our
operations may also be affected by factors which are beyond our control,
principally general market conditions and changing client
preferences. Any of these problems, or a combination thereof, could
have affect on our viability as an entity. We may never become profitable, fail
as an organization, and our investors could lose some or all of their
investment.
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Intense
competition in our market could prevent us from developing revenue and prevent
us from achieving annual profitability. In either situation, we may never become
profitable, fail as an organization, and our investors could lose some or all of
their investment.
We plan
to provide to market our real estate management services to clients. The
barriers to entry are not significant. More importantly, we face strong
competitors in all areas of our business. All aspects of our business are highly
competitive. All of our competitors are larger than us and have greater
financial resources than we do. All of our competitors have substantially
greater experience in management consulting with regard to every area in which
we plan to provide service. Competition with these companies could make it
difficult, if not impossible for us to compete, which could adversely affect our
results of operations. Competition from larger and more established companies is
a significant threat and is expected to remain so for us.
Any
competition may cause us to fail to gain or to lose clients, which could result
in reduced or non-existent revenue. Competitive pressures may impact our
revenues and our growth.
Our
success will be dependent upon our management’s efforts. We cannot sustain
profitability without the efforts of our management. An investor could lose his
entire investment.
Our
success will be dependent upon the decision making of our directors and
executive officers, particularly Mr. Zueger. These individuals intend to commit
as much time as necessary to our business, but this commitment is no assurance
of success. The loss of any or all of these individuals, particularly Mr.
Zueger, our President, could have a material, adverse impact on our operations.
An investor could lose his entire investment. We have no written employment
agreements with any officers and directors, including Mr. Zueger. We have not
obtained key man life insurance on the lives of any of our officers or
directors.
We
have limited experience as a public company. Our inability to operate
as a public company could be the basis of your losing your entire investment in
us.
We have
limited experience as a public company. We have limited experience in complying
with the various rules and regulations which are required of a public company.
As a result, we may not be able to operate successfully as a public company,
even if our operations are successful. We plan to comply with all of the various
rules and regulations which are required of a public company. However, if we
cannot operate successfully as a public company, your investment may be
materially adversely affected. Our inability to operate as a public company
could be the basis of your losing your entire investment in us.
Our
stock has a limited public trading market and there is no guarantee a trading
market will ever develop for our securities. You may not able to sell your
shares when you want to do so, if at all.
There has
been, and continues to be, a limited public market for our common stock. We
trade on the OTC Bulletin Board under the trading symbol TRMH. An active trading
market for our shares has not, and may never develop or be sustained. If you
purchase shares of common stock, you may not be able to resell those shares at
or above the initial price you paid. The market price of our common stock may
fluctuate significantly in response to numerous factors, some of which are
beyond our control, including the following:
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actual
or anticipated fluctuations in our operating
results;
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changes
in financial estimates by securities analysts or our failure to perform in
line with such estimates;
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changes
in market valuations of other companies, particularly those that market
services such as ours;
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announcements
by us or our competitors of significant
innovations, acquisitions, strategic partnerships, joint
ventures or capital
commitments;
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introduction
of product enhancements that reduce the need for our
products;
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departures
of key personnel.
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As
restrictions on resale end, the market price of our stock could drop
significantly if the holders of restricted shares sell them or are perceived by
the market as intending to sell them.
Applicable
SEC rules governing the trading of “Penny Stocks” limit the liquidity of our
common stock, which may affect the trading price of our common stock. You may
not able to sell your shares when you want to do so, if at all.
Our
common stock is currently quoted on the OTC Bulletin Board under the trading
symbol TRMH. Since our common stock trades well below $5.00 per share, we are
considered a “penny stock” and are subject to SEC rules and regulations that
impose limitations upon the manner in which our shares can be publicly
traded. These regulations require the delivery, prior to any
transaction involving a penny stock, of a disclosure schedule explaining the
penny stock and the associated risks. Under these regulations,
certain brokers who recommend such securities to persons other than established
customers or certain accredited investors must make a special written
suitability determination for the purchaser and receive the written purchaser’s
agreement to a transaction prior to purchase. These regulations have
the effect of limiting the trading activity of our common stock and reducing the
liquidity of an investment in our common stock.
The
over-the-counter market for stock such as ours is subject to extreme price and
volume fluctuations. You may not able to sell your shares when you want to do
so, at the price you want, or at all.
The
securities of companies such as ours have historically experienced extreme price
and volume fluctuations during certain periods. These broad market fluctuations
and other factors, such as new product developments and trends in the our
industry and in the investment markets generally, as well as economic conditions
and quarterly variations in our operational results, may have a negative effect
on the market price of our common stock.
Buying
low-priced penny stocks is very risky and speculative. You may not able to sell
your shares when you want to do so, if at all.
The
shares being offered are defined as a penny stock under the Securities and
Exchange Act of 1934, and rules of the Commission. The Exchange Act and such
penny stock rules generally impose additional sales practice and disclosure
requirements on broker-dealers who sell our securities to persons other than
certain accredited investors who are, 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 $200,000, or $300,000 jointly with spouse, or in
transactions not recommended by the broker-dealer. For transactions covered by
the penny stock rules, a broker-dealer must make a suitability determination for
each purchaser and receive the purchaser's written agreement prior to the sale.
In addition, the broker-dealer must make certain mandated disclosures in penny
stock transactions, including the actual sale or purchase price and actual bid
and offer quotations, the compensation to be received by the broker-dealer and
certain associated persons, and deliver certain disclosures required by the
Commission. Consequently, the penny stock rules may affect the ability of
broker-dealers to make a market in or trade our common stock and may also affect
your ability to resell any shares you may purchase in the public
markets.
We
do not expect to pay dividends on common stock.
We have
not paid any cash dividends with respect to our common stock, and it is unlikely
that we will pay any dividends on our common stock in the foreseeable future.
Earnings, if any, that we may realize will be retained in the business for
further development and expansion.
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ITEM 2. UNREGISTERED SALES OF EQUITY
SECURITIES AND USE OF PROCEEDS.
None
ITEM
3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM
5. OTHER INFORMATION
None
ITEM
6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibits
The
following financial information is filed as part of this report:
(a)
(1) FINANCIAL STATEMENTS
(2)
SCHEDULES
(3)
EXHIBITS. The following exhibits required by Item 601 to be filed herewith are
incorporated by reference to previously filed documents:
Exhibit
Number
|
Description
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3.1*
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Articles
of Incorporation
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3.2*
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Bylaws
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21.1*
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Subsidiaries
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31.1
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Certification
of CEO/CFO pursuant to Sec. 302
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32.1
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Certification
of CEO/CFO pursuant to Sec. 906
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* Previously filed with Form SB-2 Registration Statement, February 1,
2008.
(b)
The
Company filed no reports on Form 8-K during the three months ended February 28,
2010.
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SIGNATURES
Pursuant
to the requirements 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.
Transit
Management Holding Corp.
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Date: April 15,
2010
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By:
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/s/ Chris
Zueger
Chief
Executive Officer
Chief
Financial Officer
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