FORM 10-QSB
U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For Quarter Ended: September 30, 2002
Commission File Number: 0-29507
TULVINE SYSTEMS, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 52-2102141
(State of Incorporation) (IRS Employer ID No)
5525 MacArthur Blvd., Suite 615, Irving, Texas 75038
(Address of principal executive office)
972-894-9040
(Issuer's telephone number)
Check whether the issuer (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 .
The number of shares outstanding of registrant's common stock, par value $.0001
per share, as of September 30, 2002 was 1,000,000 shares, held by 1 shareholder.
Transitional Small Business Disclosure Format (Check one): Yes No X .
--- ----
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TULVINE SYSTEMS, INC.
INDEX
Page
No.
Part I. Financial Information (unaudited)
Item 1.Balance Sheet - September 30, 2002 3
Statement of Operations - 4
Three and Nine Months Ended September 30, 2002 and 2001
and October 21, 1999 (inception) to September 30, 2002
Statement of Stockholders' Equity - 5
Nine Months Ended September 30, 2002
Statements of Cash Flows - 6
Nine Months Ended September 30, 2002 and 2001
and October 21, 1999 (inception) to September 30, 2002
Notes to Financial Statements - 7-8
Nine Months Ended September 30, 2002 and 2001
Item 2.Managements Discussion and Analysis or Plan of Operation 9-10
Part II. Other Information 11-12
2
Tulvine Systems, Inc.
(A Development Stage Company)
Balance Sheet
September 30, 2002
(Unaudited)
Assets
Current assets
Cash and cash equivalents .......................................... $ 500
------
Total current assets ................................................. 500
Organization costs ................................................... 500
------
Total assets ....................................................... $1,000
======
Liabilities and Stockholder's Equity
Current liabilities
$ --
------
Total current liabilities ............................................ --
Stockholder's equity
Common stock, $.0001 par value. Authorized 100,000,000 shares; .... 100
issued and outstanding 1,000,000 shares
Additional paid in capital ......................................... 900
Retained earnings (deficit) ........................................ --
------
Total stockholder's equity ........................................... 1,000
------
$1,000
======
See accompanying notes to financial statements.
3
TULVINE SYSTEMS, INC.
(A Development Stage Company)
Statement of Operations
Three and nine months ended September 30, 2002 and 2001 and October 21, 1999
(inception) to September 30, 2002
(Unaudited)
Oct. 21,
Three Months Three Months Six Months Six Months 1999
Ended Ended Ended Ended (inception)
Sept. 30, Sept. 30, Sept. 30, Sept. 30, to Sept. 30,
2002 2001 2002 2001 2002
Sales and revenues ................. $ -- $ -- $ -- $ -- $ --
Cost of sales ...................... -- -- -- -- --
---------- ---------- ---------- ---------- ---------
Gross profit ....................... -- -- -- -- --
Other expense
General and administrative expense -- -- -- -- --
---------- ---------- ---------- ---------- ----------
-- -- -- -- --
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Earnings (loss) before income taxes -- -- -- -- --
Income taxes ....................... -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Net earnings (loss) ................ -- -- -- -- --
========== ========== ========== ========== ==========
Net earnings (loss) per share ...... $ -- $ -- $ -- $ -- $ --
========== ========== ========== ========== ==========
Weighted Average Shares Outstanding 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000
========== ========== ========== ========== ==========
See accompanying notes to financial statements.
4
TULVINE SYSTEMS, INC.
(A Development Stage Company)
Statement of Stockholder's Equity
Nine months ended September 30, 2002
(Unaudited)
Additional
Common Stock Paid-in Retained
Shares Par Value Capital Earnings Total
Balance, December 31, 2001 ............................... 1,000,000 $ 100 $ 900 $ -- $ 1,000
Net income (loss) ........................................ -- --
--------- -------- ------ ---------- ------
Balance, September 30, 2002 .............................. 1,000,000 $ 100 $ 900 $ -- $ 1,000
========= ======== ====== ========== ======
See accompanying notes to financial statements.
5
TULVINE SYSTEMS, INC.
(A Development Stage Company)
Statement of Cash Flows
Nine months ended September 30, 2002 and 2001
and October 21, 1999 (inception) to September 30, 2002
(Unaudited)
Oct. 21,
Nine Months Nine Months 1999
Ended Ended (inception)
Sept. 30, Sept. 30, to Sept. 30,
2002 2001 2002
Cash flows from operating activities
Net earnings (loss) ................................... $ -- $ -- $ --
Adjustments to reconcile net earnings (loss) to net
cash provided by (used in) operating activities:
Organization costs .................................. -- -- (500)
------- ------- -------
Net cash provided by (used in) operating activities ... -- -- (500)
------- ------- -------
Cash flows provided by (used in) investing activities
------- ------- -------
------- ------- -------
Net cash provided by (used in) investing activities ... -- -- --
------- ------- -------
Cash flows provided by (used in) financing activities
Proceeds from sale of common stock ................... 1,000
------- ------- -------
------- ------- -------
Net cash provided by (used in) financing activities ... -- -- 1,000
------- ------- -------
Net increase (decrease) in cash and cash equivalents .. -- -- 500
Cash and cash equivalents, beginning of period ........ 500 500 --
------- ------- -------
Cash and cash equivalents, end of period .............. $ 500 $ 500 $ 500
======= ======= =======
Supplemental Cash Flow Information
Cash paid for interest and income taxes are as follows:
Interest ............................................ $ -- $ -- $ --
Income taxes ........................................ $ -- $ -- $ --
See accompanying notes to consolidated financial statements.
6
TULVINE SYSTEMS, INC.
(A Development Stage Company)
Notes to Financial Statements
Nine months ended September 30, 2002 and 2001
(Unaudited)
A. Summary of Significant Accounting Policies
(1) Organization and Business Operations - Tulvine Systems, Inc. (a
development stage company) (the "Company") was organized October
21, 1999, under the laws of the State of Delaware. The Company has
no operations and in accordance with SFAS #7 is considered a
development stage company. The Company was formed to serve as a
vehicle to effect a merger, exchange of capital stock, asset
acquisition or other business combination with a domestic or
foreign private business.
The Company's ability to commence operations is contingent upon
its ability to identify a prospective target business and raise
the capital it will require through the issuance of equity
securities, debt securities, bank borrowings or a combination
thereof.
(2) Use of Estimates - The preparation of the financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.
(3) Cash and Cash Equivalents - For purposes of the statement of cash
flows, the Company considers all highly liquid investments
purchased with an original maturity of three months or less to be
cash equivalents.
(4) General - The financial statements included in this report have
been prepared by the Company pursuant to the rules and regulations
of the Securities and Exchange Commission for interim reporting
and include all adjustments (consisting only of normal recurring
adjustments) that are, in the opinion of management, necessary for
a fair presentation. These financial statements have not been
audited.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations for interim reporting. The
Company believes that the disclosures contained herein are
adequate to make the information presented not misleading.
However, these financial statements should be read in conjunction
with the financial statements and notes thereto included in the
Company's Annual Report for the period ended December 31, 2001,
which is included in the Company's Form 10-KSB filed on March 18,
2002.
(5) Income Taxes - Deferred income taxes are recognized for income and
expense items that are reported for financial purposes in
different years than for income tax purposes.
(6) Net Earnings per Share - Net earnings per share amounts are
computed using the weighted average number of shares outstanding
during the period. Fully diluted earnings per share is presented
if the assumed conversion of common stock equivalents results in
material dilution.
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B. Going Concern
The Company's financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. However, the Company has no current
source of revenue. Without realization of additional capital, it would
be unlikely for the Company to continue as a going concern. It is
management's plan to seek additional capital through a merger with an
existing operating company.
C. Stockholder's Equity
The Company has 100,000,000 shares of its $0.0001 par value common
stock authorized and 1,000,000 shares issued. There are no warrants or
options outstanding.
D. Related Party Transactions
The Company neither owns nor leases any real or personal property.
Office services are provided without charge by the director. Such costs
are immaterial to the financial statements and, accordingly, have not
been reflected therein. The officer and director of the Company is
involved in other business activities and may, in the future, become
involved in other business opportunities. If a specific business
opportunity becomes available, such person may face a conflict in
selecting between the Company and their other business interests. The
Company has not formulated a policy for the resolution of such
conflicts.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Company has registered its common stock on a Form 10-SB
registration statement filed pursuant to the Securities Exchange Act of
1934 (the "Exchange Act") and Rule 12(g) thereof. The Company files
with the Securities and Exchange Commission periodic and episodic
reports under Rule 13(a) of the Exchange Act, including quarterly
reports on Form 10-QSB and annual reports Form 10-KSB. As a reporting
company under the Exchange Act, the Company may register additional
securities on Form S-8 (provided that it is then in compliance with the
reporting requirements of the Exchange Act) and on Form S-3 (provided
that it has during the prior 12 month period timely filed all reports
required under the Exchange Act).
The Company was formed to engage in a merger with or acquisition of an
unidentified foreign or domestic private company that desires to become
a reporting company whose securities have been registered under the
Exchange Act. The Company may be deemed to meet the definition of a
"blank check" company contained in Section (7)(b)(3) of the Securities
Act of 1933, as amended.
Management believes that there are perceived benefits to being a
reporting company which may be attractive to foreign and domestic
private companies.
These benefits are commonly thought to include:
(1) the ability to use securities to make acquisition of assets or
businesses;
(2) increased visibility in the financial community;
(3) the facilitation of borrowing from financial institutions;
(4) improved trading efficiency;
(5) the potential for shareholder liquidity;
(6) greater ease in subsequently raising capital;
(7) compensation of key employees through options for stock for which
there may be a public market;
(8) enhanced corporate image; and
(9) a presence in the United States capital market.
A private company which may be interested in a business combination
with the Company may include:
(1) a company for which a primary purpose of becoming a reporting
company is the use of its securities for the acquisition
of assets or businesses;
(2) a company which is unable to find an underwriter of its securities
or is unable to find an underwriter of securities on terms
acceptable to it;
(3) a company which wishes to become a reporting company with less
dilution of its common stock than would occur normally upon an
underwriting;
(4) a company which believes that it will be able to obtain investment
capital on more favorable terms after it has become a reporting
company;
(5) a foreign company which may wish an initial entry into the United
States securities market;
(6) a special situation company, such as a company seeking to satisfy
redemption requirements under a qualified Employee Stock Option
Plan; and
(7) a company seeking one or more of the other benefits believed to
attach to a reporting company.
9
Management is actively engaged in seeking a qualified private company
as a candidate for a business combination. The Company is authorized to
enter into a definitive agreement with a wide variety of private
businesses without limitation as to their industry or revenues. It is
not possible at this time to predict with which private company, if
any, the Company will enter into a definitive agreement or what will be
the industry, operating history, revenues, future prospects or other
characteristics of that company.
As of the date hereof, management has not made any final decision
concerning or entered into any agreements for a business combination.
When any such agreement is reached or other material fact occurs, the
Company will file notice of such agreement or fact with the Securities
and Exchange Commission on Form 8-K. Persons reading this Form 10-QSB
are advised to see if the Company has subsequently filed a Form 8-K.
The current shareholder of the Company has agreed to not sell or
otherwise transfer any of its common stock of the Company except in
connection with a business combination.
The Company does not intend to trade its securities in the secondary
market until completion of a business combination. It is anticipated
that following such occurrence, the company will take the steps
required to cause its common stock to be admitted to quotation on the
NASD OTC Bulletin Board or, if it then meets the financial and other
requirements thereof, on the Nasdaq SmallCap Market, National Market
System or regional or national exchange.
Item 3. CONTROLS AND PROCEDURES
Diane Golightly, Chief Executive Officer of Tulvine established and is
currently maintaining disclosure controls and procedures for the
Company. The disclosure controls and procedures have been designed to
ensure that material information relating to the Company is made known
to her as soon as it is known by others within the Company.
During the period immediatedly after the end of the quarter, Ms.
Golightly conducts an update and a review and evaluation of the
effectiveness of the Company's disclosure controls and procedures. It
is Ms. Golightly's opinion, based upon the evaluation she completed by
October 31, 2002, that the controls and procedures currently being
utilized by the Company are sufficiently effective to ensure that any
material information relating to the Company would become known to her
within a reasonable time.
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PART II - OTHER INFORMATION
Items 1 through 5 of Part II have been omitted as not required, not
significant, or because the information has been previously reported.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits -
Exhibit 99.1 Certification by Diane Golightly, Chief Executive Officer.
(The Company does not currently employ a Chief Financial Officer)
(b) Reports on Form 8-K - None during the current quarter.
SIGNATURE
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.
TULVINE SYSTEMS, INC.
Date: November 4, 2002 By:/s/ Diane Golightly
--------------------------------
Diane Golightly, Chief Executive Officer
and Principal Accounting Officer
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EXHIBIT 99.1
CERTIFICATION
I, Diane Golightly, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Tulvine Systems,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report; 3. Based on my knowledge, the financial statements,
and other financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as, and for the periods
presented in this quarterly report;
4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant is
made known to me by others within the Company,
particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior
to the filing date of this quarterly report (the
"Evaluation Date"); and
c) presented in this quarterly report my conclusions about
the effectiveness of the disclosure controls and
procedures based on my evaluation as of the Evaluation
Date;
5. I have disclosed, based on my most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the
registrant's ability to record, process, summarize and
report financial data and have identified for the
registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant role
in the registrant's internal controls;
6. I have indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of my most
recent evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
November 4, 2002 /s/ Diane Golightly
--------------------------
Diane Golightly
Chief Executive Officer
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