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Unique Logistics International, Inc. - Quarter Report: 2007 April (Form 10-Q)

10-Q April 2007

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q


(Mark One)

S

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended April 30, 2007


£

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934


For the transition period from _______to________



Commission file number 000-50612


INNOCAP, INC.

(Exact name of registrant as specified in its charter)



Nevada

 

01–0721929

(State or other jurisdiction

 

(IRS Employer

of incorporation or organization)

 

Identification Number)


3113 Madison Drive

Atlanta, GA  30346

(Address of principal executive offices)


770–378–4180

(Registrant’s telephone number)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the 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 S    No £


Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act) Yes £    No S


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes £  No S


At September 15, 2007 the number of shares of the Registrant’s common stock outstanding was 68,000,000.











INNOCAP, INC.



INDEX


     



PART I

  

  

  

  

ITEM 1

FINANCIAL STATEMENTS                                                                         

4

  

  

  

ITEM 2

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

8

  

  

  

ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

11

  

  

  

ITEM 4

CONTROLS AND PROCEDURES   

11

  

  

  

PART II

  

  

  

ITEM I

LEGAL PROCEEDINGS

12

  

  

  

ITEM 2

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

12

  

  

  

ITEM 3

DEFAULTS  UPON SENIOR SECURITIES

12

  

  

  

ITEM 4

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

12

  

  

  

ITEM 5

OTHER INFORMATION

12

  

  

  

ITEM 6

EXHIBITS  

12

  

  

  












2



PART I



This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management's beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning possible or assumed future results of operations of the Company set forth under the heading “Management's Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,”  “anticipate,”  “intend,”  “plan,”  “believe,”  “estimate,”  “consider” or similar expressions are used.


Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. The Company's future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.






























3



ITEM 1

FINANCIAL STATEMENTS


INNOCAP, INC

(a development stage company)

Balance Sheets

(Unaudited)


 

 

April 30,

2007

 

January 31,

2007

 

 

(unaudited)

 

 

ASSETS

 

 

 

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

 

 

 

Cash

$

-

$

-

 

 

 

 

 

TOTAL ASSETS

$

-

$

-

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

 

 

Accrued liabilities

$

75,000

$

73,500

 

 

 

 

 

TOTAL CURRENT LIABILITIES

$

75,000

$

73,500

 

 

 

 

 

STOCKHOLDERS’ DEFICIT:

 

 

 

 

 

 

 

 

 

Preferred stock at $0.001 par value; 1,000,000 shares authorized, none issued and outstanding at either date

 

-

 

-

Common stock at $0.001 par value; 190,000,000 shares authorized; 68,000,000 shares issued and outstanding

 

68,000

 

68,000

Additional paid-in capital

 

1,600

 

1,600

Deficit accumulated during the development stage

 

(144,600)

 

(143,100)

Stockholders’ deficit

 

(75,000)

 

(73,500)

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

$

-

$

-




See accompanying notes to the financial statements.




4



INNOCAP, INC.

(a development stage company)

Statements of Operations

 (Unaudited)




 

 

 

 

 

 

Period from

 

 

Three

 

Three

 

January 23, 2004

 

 

Months

Ended

April 30,

 

Months

Ended

April 30,

 

(inception)

through

April 30,

 

 

2007

 

2006

 

2007

 

 

 

 

 

 

 

General and administrative

$

1,500

$

6,000

$

144,600

 

 

 

 

 

 

 

Net loss

$

(1,500)

$

(6,000)

$

(144,600)

 

 

 

 

 

 

 

Net loss per common share -basic and diluted

$

(0.00)

$

(0.00)

$

(00.00)

Weighted average number of common shares  outstanding – basic and diluted

 

68,000,000

 

68,000,000

 

68,000,000

 

 

 

 

 

 

 












See accompanying notes to the financial statements.








5





INNOCAP, INC.

(a development stage company)

Statements of Cash Flows

 (Unaudited)




 

 

 

 

 

 

Period from

 

 

Three

 

Three

 

January 23, 2004

 

 

Months

 

Months

 

(inception)

 

 

Ended

 

Ended

 

through

 

 

April 30

 

April 30

 

April 30,

 

 

2007

 

2006

 

2007

OPERATING ACTIVITIES:

 

 

 

 

 

 

Net Loss

$

(1,500)

$

(6,000)

$

(144,600)

Adjustment to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Stock-based compensation

 

-

 

-

 

1,600

Net change in accrued liabilities

 

1,500

 

6,000

 

75,000

Net Cash Used by Operating Activities

 

-

 

-

 

(68,000)

 

 

 

 

 

 

 

FINANCING ACTIVITIES:

 

 

 

 

 

 

Sale of common stock

 

-

 

-

 

68,000

 

 

 

 

 

 

 

NET INCREASE (DECREASE) IN CASH

 

-

 

-

 

-

 

 

 

 

 

 

 

CASH AT BEGINNING OF PERIOD

 

-

 

-

 

-

CASH AT END OF PERIOD

$

-

$

-

$

-

 

 

 

 

 

 

 

SUPPLEMENTAL SCHEDULE OF CASH FLOW ACTIVITIES:

 

 

 

 

 

 

Cash Paid For:

 

 

 

 

 

 

Interest

$

-

$

 -

$

 -

Income taxes

$

-

$

-

$

-

 

 

 

 

 

 

 







See accompanying notes to the financial statements.





6





INNOCAP, INC.

(A DEVELOPMENT STATE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS


(Unaudited)


NOTE 1 -- ORGANIZATION


Innocap, Inc. (the “Company”) was incorporated under the laws of the State of Nevada on January 23, 2004. In June 2004, it filed a notice with the United States Securities and Exchange Commission of its intent to elect in good faith, within 90 days from the date of such filing, to be regulated as a Business Development Company under the Investment Company Act of 1940 and be subject to Sections 54 through 65 of said Act. The Company has not generated any revenues from its planned principal operations and is considered a development stage company as defined in Statement of Financial Accounting Standards No. 7.


The Company will likely elect to cease being a Business Development Company sometime in 2007, at which time it will become a consulting firm.


NOTE 2--BASIS OF PRESENTATION


The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and with the instructions to Form 10-Q.  Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.  Operating results for the three-month period ended April 30, 2007 are not necessarily indicative of the results that may be expected for the fiscal year ending January 31, 2008. For further information, refer to the financial statements and footnotes thereto included in the Company's Form 10-K for the fiscal year ended January 31, 2007.


NOTE 3 -- GOING CONCERN


The accompanying financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  At April 30, 2007 the Company had negative working capital of $75,000, accumulated deficit of $144,600, and no revenues. These factors, among others, indicate that the Company's continuation as a going concern is dependent upon its ability to achieve profitable operations or obtain adequate financing. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.


The Company intends to cease its efforts to become a Business Development Company and will become a consulting firm sometime in 2007, at which time it will aggressively seek consulting engagements. It will use outside consultants to assist it to perform and complete any engagements obtained. If the Company is unable to obtain consulting engagements or financing or if the revenue from the consulting engagements or financing it does obtain are insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders.










7





ITEM 2


MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION


Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995


Certain matters discussed in this interim report on Form 10-Q are forward-looking statements. Such forward-looking statements contained in this annual report involve risks and uncertainties, including statements as to:


·

our future operating results,

·

our business prospects,

·

our contractual arrangements and relationships with third parties,

·

the dependence of our future success on the general economy and its impact on the industries in which we may be involved,

·

the adequacy of our cash resources and working capital, and

·

other factors identified in our filings with the SEC, press releases and other public communications.


These forward-looking statements can generally be identified as such because the context of the statement will include words such as we “believe," “anticipate,” “expect,” “estimate” or words of similar meaning.  Similarly, statements that describe our future plans, objectives or goals are also forward-looking statements.  Such forward-looking statements are subject to certain risks and uncertainties which are described in close proximity to such statements and which could cause actual results to differ materially from those anticipated as of the date of this Form 10-Q.  Shareholders, potential investors and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements.  The forward-looking statements included herein are only made as of the date of this report and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.


Operations


We are currently a development stage company.  To date, our efforts have been limited primarily to organizational activities, planning to be a Business Development Company and preparation of documents to be filed with the Securities and Exchange Commission.  We have no resources and have realized no revenues to date.  We now believe that we will be unable to raise capital through the sales of shares pursuant to Regulation E of the 1933 Act. We will, therefore, cease our efforts to become a Business Development Company and become a business consulting firm sometime in 2007, at which time we will aggressively seek consulting engagements. We will use outside consultants to assist us to perform and complete any engagements obtained. If we are unable to obtain consulting engagements or financing or if the revenue from the consulting engagements or financing that we do obtain are insufficient to cover any operating losses we may incur, we may substantially curtail or terminate our operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders.


We cannot offer any assurances that we will be successful in our efforts to become a consulting firm.




8





Liquidity


As a corporate policy, we will not incur any cash obligations that we cannot satisfy with known resources, of which there are currently none except to meet regulatory requirements.  We believe that the perception that many people have of a public company may make it likely that they will accept restricted securities from a public company as consideration for indebtedness to them than they would from a private company.  We have not performed any studies of this matter.  Our conclusion is based on our own observations.  However, there can be no assurances that we will be successful in being able to satisfy obligations through the issuance of restricted shares of our common stock.  Additionally, issuance of restricted shares would necessarily dilute the percentage of ownership interest of our stockholders.


We have not obtained any source of funding. Private capital, if sought, will be sought from former business associates of our founder or private investors referred to us by those business associates. To date, we have not sought any funding source and have not authorized any person or entity to seek out funding on our behalf.


Recent Accounting Pronouncements


In June 2003, the Securities and Exchange Commission (“SEC”) adopted final rules under Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”). Commencing with our annual report for the year ended January 31, 2008, we will be required to include a report of management on our internal control over financial reporting. The internal control report must include a statement.


§

of management’s responsibility for establishing and maintaining adequate internal control over our financial reporting;


§

of management’s assessment of the effectiveness of our internal control over financial reporting as of year end;


§

of the framework used by management to evaluate the effectiveness of our internal control over financial reporting; and


§

that our independent accounting firm has issued an attestation report on management’s assessment of our internal control over financial reporting, which report is also required to be filed.


In September 2006, the FASB issued SFAS No. 157, Fair Value Measurement (“SFAS 157”). SFAS 157 defines fair value and establishes a framework for measuring fair value in accordance with generally accepted accounting principles. SFAS 157 also expands the disclosures related to the fair value measurements used to value assets and liabilities. SFAS 157 is effective for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. We are currently evaluating whether the adoption of SFAS 157 will have a material impact on our financial statements.


In September 2006, FASB issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No 87, 88, 106 and 132(R) (“SFAS 158”).  SFAS 158 requires the recognition of the overfunded or underfunded status of a defined benefit postretirement plan as an asset or liability in the statement of financial position and the recognition of changes in that funded status in the year in which the changes occur through comprehensive income. SFAS 158 also requires the measurement of the funded status of a plan as of the date of the year-end statement of financial position. The Company does not anticipate that the adoption of this statement will have a material effect on the Company’s financial condition and results of operations.




9





In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (“SFAS 159”). SFAS 159 permits entities to choose to measure, on an item-by-item basis, specified financial instruments and certain other items at fair value. Unrealized gains and losses on items for which the fair value option has been elected are required to be reported in earnings at each reporting date. SFAS 159 is effective for fiscal years beginning after November 15, 2007, the provisions of which are required to be applied prospectively.


In September 2006, the SEC staff issued Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”). SAB 108 was issued in order to eliminate the diversity in practice surrounding how public companies quantify financial statement misstatements. SAB 108 requires that registrants quantify errors using both a balance sheet and income statement approach and evaluate whether either approach results in a misstated amount that, when all relevant quantitative factors are considered, is material.


In June 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (“FIN 48”).  FIN 48 clarifies the accounting for uncertainty in income taxes and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  FIN 48 is effective for financial statements as of January 1, 2007.  The application of FIN 48 did not have a material impact on our financial position and results of operations.


The Financial Accounting Standards Board, the Emerging Issues Task Force (the “EITF”) and the Securities and Exchange Commission have issued certain other accounting pronouncements and regulations that will become effective in subsequent periods; however, management of the Company does not believe that any of those pronouncements would have significantly affected the Company’s financial accounting measurements or disclosures had they been in effect prior to April 30, 2007, and it does not believe that any of those pronouncements will have a significant impact on the Company’s financial statements at the time they become effective.


Critical Accounting Policies


The preparation of financial statements and related notes requires us to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.


An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements.


Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements.  There are no critical policies or decisions that rely on judgments that are based on assumptions about matters that are highly uncertain at the time the estimate is made.  

  

Seasonality


We do not yet have a basis to determine whether our business will be seasonal.


Off-Balance Sheet Arrangements


We have no off-balance sheet arrangements, as defined in Regulation S-B Section 303.




10





ITEM 3


QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


Since we have no assets and do not have any investments, there is no quantitative information or market risk that has any impact on our present business.



ITEM 4


CONTROLS AND PROCEDURES


We maintain disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer (one person, our President), as appropriate, to allow timely decisions regarding required disclosures.


As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of that date.


There was no change in our internal control over financial reporting during our most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.















11





PART II


Item 1

Legal Proceedings


None


Item 2

Unregistered Sales of Equity Securities and Use of Proceeds


There have been no events that are required to be reported under this Item.



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


None


Exhibit Number

Description

 

 

31.1

Section 302 Certification of Chief Executive Officer and Chief Financial Officer

  

 

32.1

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of The Sarbanes-Oxley Act of 2002

 



12






Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Innocap, Inc.

(Registrant)



By:

/s/ B. Alva Schoomer                        

B. Alva Schoomer

President



September 27, 2007



13