Attached files
| file | filename |
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| EX-10.2 - INTERNATIONAL DEVELOPMENT & ENVIRONMENTAL HOLDINGS | v198297_ex10-2.htm |
| EX-10.1 - INTERNATIONAL DEVELOPMENT & ENVIRONMENTAL HOLDINGS | v198297_ex10-1.htm |
| EX-99.1 - INTERNATIONAL DEVELOPMENT & ENVIRONMENTAL HOLDINGS | v198297_ex99-1.htm |
Securities
and Exchange Commission
Washington,
D. C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report: September 16, 2010
INTERNATIONAL
DEVELOPMENT AND ENVIRONMENTAL HOLDINGS
(Name of
Registrant as specified in its charter)
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Nevada
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000-54106
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32-0237237
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(State or Other Jurisdiction
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(Commission
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(I.R.S. Employer
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of Incorporation)
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File Number)
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Identification No.)
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1173A
Second Avenue
Suite
327
New York,
NY 10065
(Address
and telephone number of principal executive offices)
1701 E.
Woodfield Rd.
Suite
915
Schaumburg,
IL 60173
(Previous
address of principal executive offices)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Item 1.01 Entry
into a Material Definitive Agreement.
Acquisition
Agreement
On September 16, 2010, pursuant to the
terms of an Acquisition and Reorganization Agreement (the “Acquisition
Agreement”) by and between the Registrant (the “Company”), Heights Management
63, LLC, a New York limited liability company (“Heights”) and Scott Lieberman,
the Company acquired all of the outstanding membership interests of Heights
resulting in Heights becoming a wholly-owned subsidiary of the
Company.
Redemption Agreement and
Promissory Note
On September 16, 2010, pursuant to the
terms of a Redemption Agreement (the “Redemption Agreement”) by and between the
Registrant (the “Company”) and JTMW Partners (the
“Seller”), the Company agreed to redeem and cancel 30,710,00 shares of the
Company’s common stock owned by the Seller for a total of
$510,000. In connection with the Redemption Agreement, the Company
issued a secured promissory note to the Seller (the “Promissory Note”) in the
amount of $450,000, payable on or before November 1, 2010. As
security for the payment of all amounts due under the Promissory Note, the
Company pledged its ownership interest in its Heights subsidiary. In
addition, our President, Scott Lieberman, agreed to personally guarantee the
obligations of the Company under the Promissory Note.
Item
2.01 Completion
of Acquisition or Disposition of Assets
On September 16, 2010, pursuant to the
terms of an Acquisition and Reorganization Agreement (the “Agreement”) by and
between the Registrant (the “Company”), Heights Management 63, LLC, a New York
limited liability company (“Heights”) and Scott Lieberman (the “Seller”), the
Company acquired all of the outstanding membership interests of Heights
resulting in Heights becoming a wholly-owned subsidiary of the
Company.
Pursuant to the terms of the Agreement,
as consideration for all of the outstanding membership interests of Heights, the
Company issued 8,700,000 newly issued shares of the Company’s newly declared
Series A Preferred Stock to the Seller. Each share of Series A
Preferred Stock is convertible into and has voting rights equal to fifty (50)
days of common stock. Simultaneously, pursuant to the terms of a Redemption
Agreement, a total of 30,710,00 shares of the Company’s common stock which were
held by the Company’s former majority stockholder.
Description of Heights
Management 63
As used in this Current Report on Form
8-K, all references to the “Company,” “we,” “our” and “us” for periods prior to
the closing of the Acquisition refer to Heights Management 63, LLC , and for
periods subsequent to the closing of the Acquisition refer to International
Development and Environmental Holdings and its wholly-owned subsidiary, Heights
Management 63, LLC.
Overview
We are
engaged in the business of acquiring and managing parking lots and garages in
New York City and surrounding areas.
Industry
Overview
The
parking industry is highly fragmented, consisting of a few nationwide companies
and a large number of smaller operators, including a substantial number of
companies providing parking as an ancillary service in connection with property
management or ownership. The parking industry as a whole is experiencing a
period of rapid consolidation. Based upon the 2010 research report of IBISWorld,
the parking sector in the US consisted of approximately 7,000 firms generating
over $7.5 billion in annual revenues in 2009. In is believed that in
the United States, there are approximately 35,000 parking structures
representing 5,000,000 parking spaces.
Overall
parking industry expansion is created by new construction. Since new
construction in the United States slowed in the late 2000’s, recent growth in
parking companies has generally resulted only from take-aways from other parking
companies, that is, taking over a parking facility being managed or leased by a
competitor. Take-aways and new construction are essential to growth in the
parking industry because of the limitations on revenue growth of existing
operations. While some growth in revenues from existing operations is possible
through redesign, increased operational efficiency, or increased facility use
and prices, such growth is ultimately limited by the size of a facility and
market conditions.
Privatization
of government operations and facilities could provide new opportunities for the
parking industry. Currently, government-controlled parking facilities, operated
by municipal entities, account for approximately 50% of all
lots. Cities and municipal authorities may consider retaining private
firms to operate facilities and parking-related services in an effort to reduce
operating budgets and increase efficiency.
The
Company anticipates the continued growth of the private parking industry due to
general trends, which include the following:
• Major
long-term industry consolidation through acquisitions.
• Privatization
of government-controlled parking, patrolling, ticketing and other related
services.
• Outsourcing
of ancillary parking services by public and private commercial real estate
owners.
• Changing
industry leasing practices to require significant up-front lease payments, which
favor well-capitalized operations.
New
York Parking Market
The
Company's growth will be as a result of a well-formulated acquisition strategy
initially focused on the New York metropolitan area. Parking is a large business
in the New York area with approximately 1 - 1.5 million cars entering New York
City everyday. According to the Metropolitan Parking Authority, the New York
parking industry is broken down as follows:
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Lots
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Manhattan
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407
parking lots (capacity 35,411 cars)
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Outer
Boroughs
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878
parking lots (capacity 111,218 cars)
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Garages
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Manhattan
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822
garages (capacity 126,884 cars)
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Outer
Boroughs
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1,183
garages (capacity 193,889
cars)
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The New
York parking business is dominated by a handful of large companies with
resources substantially greater than those of the Company. These organizations
generally focus on high profile, high turnover Manhattan facilities with
capacities greater than 150 cars.
Our
Strategy
The
Company will look for smaller, obscure parking locations that tend to be under
the "radar screens" of the larger operators.
Competition
for the smaller sites is generally limited to a handful of existing players
similar in size to the Company. New entrants generally encounter
great difficulty entering the New York market as sellers will usually only deal
with established operators. The bidding process is therefore usually
less competitive, creating attractive opportunities for the
Company.
The
Company carefully selects and analyzes new sites by conducting an examination of
a location's potential demand based on traffic patterns and counts, area
demographics, and potential competitors, and compares this analysis to the
projected revenues and costs of the facility.
The
Company has established a acquisition strategy, depends heavily on management’s
ability to identify and integrate acquisitions.
The
Company believes that consolidation is being driven primarily by the opportunity
to achieve economies of scale. The most obvious savings from consolidation will
be attained by reducing redundant overhead costs, but may also be achieved
through operating improvements such as implementing improved management
practices and control systems. The Company intends to employ a strategy of
consolidation by applying standardized professional management strategies to a
fragmented, local business environment with exploitable economies of
scale.
The
Company seeks to reduce redundant overhead costs as well as realize operating
improvements such as implementing standardized management practices and
management information systems.
On the
demand side, consolidation is driven by the requirements of large property
owners for professional management, increased services, up-front capital
investments and superior financial reporting. These parties often outsource
parking operations to parking management companies in an effort to maximize
profits or leverage the original rental value to a third-party
lender.
Operations
The
single parking facility which we currently operate is located in Manhattan and
is operated under a lease from a third-party landlord. The following
table shows the general location, size and remaining lease term for the parking
facility:
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Location
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Capacity
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Lease Term
Expires
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Manhattan
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38
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April
30, 2012
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The
Company plans to search out new parking facilities as well as valet
opportunities. The company emphasizes the importance of marketing, containing
costs, realizing economies of scale, maintaining strict cash control, using a
decentralized management structure, providing strong training programs for
employees and enhancing management information systems in order to attract new
and retain existing parking patrons.
Leases
Lease
arrangements are typically for terms of three to twenty years and provide for
renewals and contractually established payments to the facility owner regardless
of the operating earnings of the parking facility. Under these leases, the
Company is responsible for all facets of the parking operations, including
utilities and ordinary and routine maintenance, but is generally not responsible
for major maintenance, repair, or property taxes.
Maintenance
At least
annually, and when needed on a more frequent basis, the Company’s management
services include painting of traffic guides and parking areas, lighting of areas
for improved operations and safety, gate maintenance, and electronics upgrade
and maintenance.
Management
Controls
The
parking industry in general is plagued by a high turnover of employees and a
loss of receipts due to theft. The Company maintains an exceptionally low
turnover rate and believes it has minimized theft due to its exceptional
recruitment process and its sophisticated revenue control system. The Company
utilizes a software system that generates a range of reports to audit the
Company's parking facilities. These reports provide management with current data
concerning patron traffic, revenue collection and all other facets of the
Company's operations.
Intellectual
Property
Our
intellectual property consists of our trademarks including “Heights
Management.” The Company has not filed applications for registration
of any of its trademarks. The Company regards the protection of our
copyrights, service marks, trademarks, trade dress and trade secrets as critical
to our future success. We rely on a combination of copyright, trademark, service
mark and trade secret laws, and contractual restrictions to establish and
protect our proprietary rights in products and services.
Although
we do not believe that we infringe the proprietary rights of third parties,
there can be no assurance that third parties will not claim infringement by us
with respect to past, current or future technologies. Any such claim,
whether meritorious or not, could be time-consuming, result in costly litigation
and could have a material adverse effect upon our business, results of
operations and financial condition.
Subsidiaries
The
Company currently has one wholly-owned subsidiary, Heights Management 63, LLC, a
New York limited liability company.
Forward-Looking
Statements
The
Company or management may make or may have made certain forward-looking
statements, orally or in writing, such as those within Management's Discussion
and Analysis contained in its various SEC filings. The Company wishes to ensure
that such statements are accompanied by meaningful cautionary statements, so as
to ensure to the fullest extent possible the protections of the safe harbor
established in the Private Securities Litigation Reform Act of 1995. Such
statements are therefore qualified in their entirety by reference to and are
accompanied by the following discussion of certain important factors that could
cause actual results to differ materially from those described in such
forward-looking statements.
The
Company cautions the reader that this list of factors is not intended to be
exhaustive. The Company operates in a continually changing business environment,
and new risk factors emerge from time to time. Management cannot predict such
factors, nor can it assess the impact, if any, of such factors on the Company's
business or the extent to which any factors may cause actual results to differ
materially from those described in any forward-looking statement. None of the
Company's forward-looking statements should be relied upon as a prediction of
actual results.
The
Company faces risks and uncertainties that could render actual events materially
different than those described in our forward-looking statements. These risks
and uncertainties are described elsewhere in this report.
Legal
Proceedings
We are
not currently subject to any legal proceedings.
Employees
As of
June 30, 2010, the Company employed four full-time employees and one part time
employee.
The
future success of the Company will depend in part on our continued ability to
attract, integrate, retain and motivate highly qualified technical and
managerial personnel, and upon the continued service of our senior management
personnel. The competition for qualified personnel in our industry and
geographical location is intense, and there can be no assurance that we will be
successful in attracting, integrating, retaining and motivating a sufficient
number of qualified personnel to conduct our business in the
future. The Company has never had a work stoppage, and no employees
are represented under collective bargaining agreements. We consider our
relations with our employees to be good.
Properties
Our
executive office consists of approximately 1,500 square feet of office space in
Brooklyn, New York. This facility is leased on a month to month basis
from an affiliate of the Company. We currently do not pay any rent
for the use of the office space. We believe that our current facilities are
adequate for the purposes for which they are intended and that they provide
sufficient capacity to accommodate the Company’s expansion plan.
In
addition, the Company currently leases one parking facility from a third-party
landlord with various lease expiration terms, as shown below:
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Location
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Capacity
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Lease Term
Expires
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Manhattan
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38
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April
30, 2012
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MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
The following discussion of our
financial condition and results of operations should be read in conjunction with
our consolidated financial statements and notes thereto appearing elsewhere in
this registration statement.
The matters discussed in this
registration statement contain forward-looking statements that involve risks and
uncertainties. Our actual results could differ materially from those
discussed herein. Factors that could cause or contribute to such
differences are discussed in this section and elsewhere in this Current Report
on Form 8-K.
Plan
of Operations
The Company was formed on March 19,
2009 to acquire and operate parking facilities in the New York City metropolitan
area. Since inception, the Company has had total revenue of $243,000
and total expenses of $295,577. As of June 30, 2010, the
Company had total assets of $166,611consisting of $14,944 in property and
equipment net of depreciation and intangible assets in the
form of lease acquisition costs in the amount of $151,667.
Liquidity
and Capital Resources
Our capital requirements are dependent
on several factors and are primarily related to our product development
expenses. We believe that our current cash and cash equivalents along with cash
to be generated by operations will be sufficient to meet our anticipated cash
for the next 12 months. If cash generated from operations is
insufficient to satisfy our liquidity requirements, we may seek to sell
additional equity or debt securities or obtain a credit facility. The
sale of additional equity or convertible debt securities could result in
additional dilution to our stockholders. The incurrence of indebtedness would
result in an increase in our fixed obligations and could result in borrowing
covenants that would restrict our operations. There can be no assurance that
financing will be available in amounts or on terms acceptable to us, if at all.
If financing is not available when required or is not available on acceptable
terms, we may be unable to continue to grow our business. In addition, we may be
unable to take advantage of business opportunities or respond to competitive
pressures. Any of these events could have a material and adverse effect on our
business, results of operations and financial condition.
Risks
and Uncertainty
The preceding statements under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" which are not historical facts are forward-looking statements. These
forward-looking statements involve risks and uncertainties that could render
them materially different, including, but not limited to, the risk that new
products and product upgrades may not be available on a timely basis, the risk
that such products and upgrades may not achieve market acceptance, the risk that
competitors will develop similar products and reach the market first, and the
risk that the Company would not be able to fund its working capital needs from
cash flow.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of
September 20, 2010, the ownership of the Company’s common stock by (i) each of
our directors and executive officers; (ii) all of our executive officers and
directors as a group; and (iii) all persons known by us to beneficially own more
than 5% of our common stock. Unless otherwise indicated in the
footnotes to the table, (1) the following individuals have sole voting and sole
investment control with respect to the shares they beneficially own and (2) the
address of each beneficial owner listed below is c/o the Company.
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Name and Address of
Beneficial Owner
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Shares of
Common
Stock (1)
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Shares of
Series A
Preferred Stock
(1)
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Percentage
Ownership of
Common Stock on
an As-Converted
basis (2)
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Executive
Officers and
Directors
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Scott
Lieberman
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- | 8,700,000 | 99.1 | % | ||||||||
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All
Executive Officers and Directors as a group (one persons)
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- | 8,700,000 | 99.1 | % | ||||||||
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All
Executive Officers, Directors and 5% Stockholders as a group (one
persons)
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8,700,000 | 99.1 | % | |||||||||
(1) Calculated
pursuant to Rule 13d-3(d) of the Exchange Act. Under Rule 13d-3(d), shares not
outstanding which are subject to options, warrants, rights or conversion
privileges exercisable within 60 days are deemed outstanding for the purpose of
calculating the number and percentage owned by such person, but are not deemed
outstanding for the purpose of calculating the percentage owned by each other
person listed.
(2) Based
upon 439,770,000 shares of Common Stock issued and outstanding, on an
on-converted basis, as of September 20, 2010.
Employment
Agreements and Executive Compensation
The Company currently has no written
employment agreement with our executive officers nor do we have any termination
of employment or any change of control arrangements with our
officer. We have agreed to pay our Chief Executive Officer a salary
of $50,000 per year. We do not carry any key-man or other life insurance on
any of our officers.
Employee
Benefit Plans
The Company maintains standard health
insurance for its employees.
Off-Balance
Sheet Arrangements
We have no off-balance sheet
arrangements.
Item
3.02 Unregistered
Sales of Equity Securities
On September 16, 2010, the Company
issued 8,700,000 newly issued shares of the Company’s Series A Preferred Stock
to the Seller as consideration for the Company’s acquisition of
Heights. This transaction was not registered under the Act in
reliance on the exemption from registration in Section 4(2) of the Act, as a
transaction not involving any public offering. These securities were
issued as restricted securities and the certificates were stamped with
restrictive legends to prevent any resale without registration under the Act or
in compliance with an exemption.
Item
5.01 Change
in Control of Registrant
On September 16, 2010, the Company
issued 8,700,000 newly issued shares of the Company’s Series A Preferred
Stock in connection with the Company’s acquisition of
Heights.
Item
5.02 Departure of Directors or
Principal Officers; Election of Directors; Appointment of Principal
Officers
On September 16, 2010, Bernard J.
Tanenbaum III resigned as President of the Company and as a director of the
Company.
On September 16, 2010, Michael T.
Williams resigned as Corporate Secretary of the Company and as a director of the
Company
On September 16, 2010, Scott Lieberman
was appointed to the Board of Directors of the Company in accordance with the
written consent of majority of directors dated September 16, 2010. In
addition, on September 16, 2010, Scott Lieberman was appointed Chief Executive
Officer of the Company. Mr. Scott Lieberman has had no prior
relationship with the Company and was not a party to any transaction with the
Company prior to the Acquisition Agreement.
The following table sets forth the
names and positions of our new directors and executive officers:
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Name
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Age
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Position
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Scott
Lieberman
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49
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CEO,
Director
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Scott
Lieberman has over 30 years of expertise in professional parking management and
the commercial leasing of cars, vans and trucks. His career commenced in a
family-owned business in 1979 operating and managing a fleet of over 200 cars,
vans and trucks. Since 1988 , Mr. Lieberman took the reigns and successfully
expanded the business with the leasing of over twenty parking lots which he
operated and managed.
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Item 9.01
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Financial
Statements and Exhibits
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Exhibit
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Description
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10.1
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Acquisition
and Reorganization Agreement
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10.2
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Redemption
Agreement
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99.1
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Auditor’s
Report and audited financial statements of Heights Management
63, LLC for the period from inception (March 19,
2009) to December 31, 2009,
and unaudited financials of Heights Management 63, LLC from January
1, 2010 through June 30, 2010
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SIGNATURES
Pursuant
to the requirements of the Securities and Exchange Act of 1934, the Company has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Dated:
September 22, 2010
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International
Development and
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Environmental
Holdings
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/s/
Scott Lieberman
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By:
Scott Lieberman, CEO
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