UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_________________
FORM
10-Q
_________________
þ
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended: November 30, 2012
or
o
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from: ______ to ______
_________________
PROFIT
PLANNERS MANAGEMENT , INC.
(Exact
name of registrant as specified in its charter)
_________________
Neveda
|
333-142076
|
90-0450030
|
(State or Other Jurisdiction
|
(Commission
|
(I.R.S. Employer
|
of Incorporation or Organization)
|
File Number)
|
Identification No.)
|
350 Madison Avenue ,8th Floor, New York,
New York, 10017
(Address of Principal Executive Offices)
(Zip Code)
(908) 788-0077
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address and former fiscal year, if changed since last report)
_________________
Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes
þ
No
o
Indicate by check mark whether
the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes
o
No
þ
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer, or a smaller reporting company.
Large accelerated filer
o
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
þ
|
Indicate by check mark
whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
o
No
þ
APPLICABLE
ONLY TO CORPORATE ISSUERS
As of January
15, 2013, the issuer had
50,507,416
outstanding shares of Common Stock.
Profit Planners Management, Inc.
TABLE
OF CONTENTS
PART
I.
ITEM 1. FINANCIAL INFORMATION
Profit Planners Management, Inc.
Condensed Consolidated Balance Sheets
|
|
|
|
|
|
|
|
November 30, 2012
|
|
May 31, 2012
|
|
Assets
|
|
(Unaudited)
|
|
(Audited)
|
|
Current assets:
|
|
|
|
|
|
Cash
|
|
$
|
85,447
|
|
$
|
80,537
|
|
Accounts receivable
|
|
|
94,572
|
|
|
77,425
|
|
Unbilled revenue
|
|
|
56,000
|
|
|
-
|
|
Other current assets
|
|
|
13,275
|
|
|
11,288
|
|
Total current assets
|
|
|
249,294
|
|
|
169,250
|
|
|
|
|
|
|
|
|
|
Net property and equipment
|
|
|
8,254
|
|
|
3,313
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
$
|
257,548
|
|
$
|
172,563
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$
|
192,299
|
|
$
|
1
41,444
|
|
Accounts payable and accrued expenses - related party
|
|
|
37,145
|
|
|
33,150
|
|
Total Liabilities
|
|
|
229,444
|
|
|
174,594
|
|
|
|
|
|
|
|
|
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Stockholders' Equity
|
|
|
|
|
|
|
|
Preferred stock - $.001 par value; 50,000,000 shares authorized; none issued and outstanding
|
|
|
-
|
|
|
-
|
|
Common stock - $.001 par value; 500,000,000 shares authorized; 50,507,416 and 50,407,416 shares issued and outstanding, respectively
|
|
|
50,507
|
|
|
50,406
|
|
Common stock - $.001 par value; 370,372 shares subscribed not issued, respectively
|
|
|
370
|
|
|
370
|
|
Additional paid-in capital
|
|
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151,154
|
|
|
144,120
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|
Less: Amount due from subscriber under subscription agreement
|
|
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(28,334)
|
|
|
(33,334)
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|
Accumulated deficit
|
|
|
(145,593)
|
|
|
(163,593)
|
|
Net Stockholders' Equity (Deficit)
|
|
|
28,104
|
|
|
(2,031)
|
|
Total Liabilities And Stockholders' Equity
|
|
$
|
257,548
|
|
$
|
172,563
|
|
See accompanying notes to condensed consolidated
financial statements.
1
Profit Planners Management, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
|
Three Months
Ended
November 30,
2012
|
Three Months Ended
November 30,
2011
|
Six Months
Ended
November 30,
2012
|
Six Months
Ended
November 30,
2011
|
|
|
|
|
|
Revenue
|
$
|
202,410
|
$
|
141,063
|
$
|
453,210
|
$
|
187,700
|
Related parties revenue
|
|
–
|
|
–
|
|
–
|
|
3,000
|
Total revenue
|
|
202,410
|
|
141,063
|
|
453,210
|
|
190,700
|
|
|
|
|
|
|
|
|
|
Staff salaries – project related
|
|
138,315
|
|
25,063
|
|
257,425
|
|
25,063
|
Related parties –projected related
|
|
–
|
|
37,387
|
|
–
|
|
62,375
|
Other outsourced services
|
|
4,160
|
|
–
|
|
9,569
|
|
–
|
Total cost of revenue
|
|
142,475
|
|
62,450
|
|
266,994
|
|
87,438
|
|
|
|
|
|
|
|
|
|
Gross Profit
|
|
59,935
|
|
78,613
|
|
186,216
|
|
103,262
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Officer’s compensation
|
|
22,784
|
|
22,532
|
|
49,071
|
|
27,032
|
Consulting & professional
expenses
|
|
38,078
|
|
26,725
|
|
44,878
|
|
28,861
|
Other operating expenses
|
|
39,826
|
|
24,989
|
|
74,267
|
|
32,669
|
Total operating expenses
|
|
100,688
|
|
74,246
|
|
168,216
|
|
88,562
|
|
|
|
|
|
|
|
|
|
Net (Loss) Income
|
$
|
(40,753)
|
$
|
4,367
|
$
|
18,000
|
$
|
14,700
|
|
|
|
|
|
|
|
|
|
Basic and diluted Net income per weighted-average shares common stock
|
$
|
(0.00)
|
$
|
0.00
|
$
|
0.00
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares of common stock to be issued and outstanding-Basic
|
|
50,424,998
|
|
50,482,446
|
|
50,416,159
|
|
50,267,000
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares of common stock to be issued and outstanding-Diluted
|
|
50,424,998
|
|
51,223,188
|
|
51,069,045
|
|
51,007,742
|
|
|
|
|
|
|
|
|
|
See accompanying
notes to condensed consolidated financial statements.
2
Profit Planners Management, Inc.
Condensed Consolidated Statements of Cash
Flows
(Unaudited)
|
|
Six Months
Ended
November 30, 2012
|
|
Six Months
Ended
November 30, 2011
|
|
|
|
|
|
Net cash provided by (used in) operating activities
|
|
$
|
5,475
|
|
$
|
(28,573)
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
(5,565)
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|
|
(1,400)
|
|
|
|
|
|
|
|
Net cash provided by financing activities
|
|
|
5,000
|
|
|
33,333
|
|
|
|
|
|
|
|
Net change in cash
|
|
|
4,910
|
|
|
3,360
|
Cash, beginning of period
|
|
|
80,537
|
|
|
37,300
|
Cash, end of period
|
|
$
|
85,447
|
|
$
|
40,660
|
See accompanying notes to condensed consolidated
financial statements
3
Profit
Planners Management, Inc.
Notes
to Condensed Consolidated Financial Statements
November
30, 2012
NOTE
1 - BASIS OF PRESENTATION
The
accompanying unaudited condensed consolidated financial information of Profit Planners Management, Inc. (the Company) have been
prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations
of the United States Securities and Exchange Commission for interim financial information and with the instructions to Form 10-Q
and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes necessary for a comprehensive
presentation of financial position, results of operations, or cash flows. It is management’s opinion, however, that all
material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement
presentation.
The
condensed consolidated financial information for the three months and six months ended November 30, 2012 include the accounts
of the Company and its wholly-owned subsidiaries and all intercompany balances and transactions have been eliminated in consolidation.
The
balance sheet at May 31, 2012 has been derived from the audited consolidated financial statements at that date, but does not include
all of the information and footnotes required by accounting principles generally accepted in the United States of America for
complete financial statements.
The
unaudited interim financial information should be read in conjunction with the Company’s Form 10-K, which contains the audited
consolidated financial statements and notes thereto, together with Management’s Discussion and Analysis, for the year ended
May 31, 2012. The interim results for the period ended November 30, 2012 are not necessarily indicative of the results for the
full fiscal year.
NOTE
2 – NET INCOME (LOSS) PER COMMON SHARE
Basic
net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock
outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average
number of shares of common stock and potentially outstanding shares of common stock during each period. There were -0- and 720,372
potentially dilutive shares outstanding as of November 30, 2012 and November 30, 2011, respectively.
NOTE
3 – GOING CONCERN
As
reflected in the accompanying condensed consolidated financial statements, the Company had net income of $18,000 for the six months
ended November 30, 2012; however, the Company has minimal historical evidence of positive earnings as evidenced by the accumulated
deficit of $145,593 at November 30, 2012. The historical trend of losses raises substantial doubt about the Company’s ability
to continue as a going concern.
Management
believes that the actions presently being taken and the success of future operations will be sufficient to enable the Company
to continue as a going concern. These actions include continuing to grow our revenues sufficient to support our cost structure
through existing and new clients. In addition, management intends to obtain capital in the near future through additional private
placement offerings.
There
can be no assurance that anticipated revenue growth and the raising of equity will be successful nor is there assurance that the
Company’s anticipated financing will be available in the future, at terms satisfactory to the Company. Failure to achieve
revenue growth and the equity and financing at satisfactory terms and amounts could have a material adverse effect on the Company’s
ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome
of this uncertainty.
NOTE
4 – INCOME TAXES
The
Company has not recorded any income tax expense or benefit for the six months ended November 30, 2012. Any taxable income generated
will be offset by net operating losses (“NOL”) generated in previous years. At the present time, management cannot
determine if the Company will be able to generate sufficient taxable income to realize the benefit of the NOL carryforwards;
accordingly, a valuation allowance has been established to offset the asset.
NOTE
5 – STOCKHOLDERS’ EQUITY
On
September 26, 2012, the board of directors of the Company approved a stock dividend payable to the holders of its issued and outstanding
common stock, par value $.001 per share (the “Stock Dividend”). Under the terms of the Stock Dividend approved by
the board, the holders of the Company’s common stock as of September 28, 2012 (the “Record Date”) were issued
one (1) share of the Registrant’s common stock for each one (1) share owned by such holders on the Record Date. The Stock
Dividend was effective on October 10, 2012 (the “Payment Date”).
As
a result of the Stock Dividend, 25,203,708 shares of the Registrant’s common stock were issued to the Registrant’s
shareholders of record as of the Record Date.
All
periods presented in the accompanying condensed consolidated financial statements have been retroactively adjusted to reflect
the issuance of the stock dividend.
4
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Forward-Looking
Statements
The
information in this report contains forward-looking statements. All statements other than statements of historical fact made in
this report are forward looking. In particular, the statements herein regarding industry prospects and future results of operations
or financial position are forward-looking statements. These forward-looking statements can be identified by the use of words such
as “believes,” “estimates,” “could,” “possibly,” “probably,” “anticipates,”
“projects,” “expects,” “may,” “will,” or “should” or other variations
or similar words. No assurances can be given that the future results anticipated by the forward-looking statements will be achieved.
Forward-looking statements reflect management’s current expectations and are inherently uncertain. Our actual results may
differ significantly from management’s expectations.
The
following discussion and analysis should be read in conjunction with our accompanying financial statements and the notes to those
financial statements included in this filing. The following discussion includes forward-looking statements that reflect our plans,
estimates and beliefs. Our actual results could differ materially from those discussed in these forward-looking statements. Factors
that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this
filing.
Operation
We
are a Nevada Corporation founded in January 2009 with offices in New York, California and Florida.
Over
the past twelve months our operations have expanded into several business areas. Our current operations are divided into the following
revenues:
|
·
|
CFO,
Accounting and Tax services;
|
|
·
|
Energy
and telecom cost reduction services;
|
|
·
|
Insurance
and healthcare insurance services;
|
|
·
|
Business
to Business Social Media Platform
|
|
·
|
Management
Services
|
Our
CFO, Accounting and Tax services are currently the main revenue guarantor with more than 95% of our revenues. In the future, we
expect this percentage to go down as our other revenues gains traction in the market place.
Marketing
Our
marketing efforts are targeted to small to midsized companies that are known to, located or identified by our finders network.
We also utilize our contacts with other professional service firms (law firms, investment bankers, venture capital firms and CPA
audit firms) that provide services to the small and middle market sector for referrals of potential clients. We also intend to
explore potential acquisitions of small accounting, or other consulting firms, to acquire their customer lists in order to expand
our client base.
Currently
we are operating Unified Partners as part of the marketing program for our services and products. As new users sign up for the
Unified Partners interactive platform, we will use the information gathered from those users to target our marketing to companies
that could benefit from our services. We believe that the benefits of Unified Partners will be as a source of potential customers
for our other services and products.
Our
target will be on companies that have sales of less than $100 million and are based in North America. Our industry focus is professional
services and products. Although we focus on these industries we will look at opportunities in other industries if it makes economic
sense.
We
currently own and operate the following web-sites.
•
|
|
www.profitplannersmgt.com
|
•
|
|
www.unifiedpartnersgroup.com
|
We
use these web-sites as part of our marketing strategy.
We
believe that these strategies will provide the best results given our limited marketing budget.
Critical
Accounting Policies
Accounts
receivable
Accounts
receivable represents open invoices from customers. The Company periodically evaluates the collectability of its accounts receivable
and considers the need to record or adjust an allowance for doubtful accounts based upon historical collection experience and
specific customer information. Actual amounts could vary from the recorded estimates. The Company has determined that as of November
30, 2012, no allowance for doubtful accounts was required because we believe that all receivables will subsequently be collected.
The Company does not require collateral to support customer receivables.
4
Revenue
recognition
The
Company’s revenues are derived from management, financial and accounting advisory services. The Company will
recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned
when it has persuasive evidence of an arrangement that the services have been rendered to the customer, the sales price is fixed
or determinable, and collectability is reasonably assured.
Net
income (loss) per common share
Basic
net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock
outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average
number of shares of common stock and potentially outstanding shares of common stock during each period. There were -0- potentially
dilutive shares outstanding as of November 30, 2012.
Results
of operations
Three and
Six Months Ended November 30, 2012 and 2011
For
the three months ended November 30, 2012 and 2011, the company had revenue of $202,410 and $141,063, respectively. The increase
in revenue was mainly due to new third-party customers during the three months ended November 30, 2012 compared to the three months
ended November 30, 2011. Cost of revenue for the three months ended November 30, 2012 and 2011 totaled $142,475 and $62,450, respectively.
Operating expenses for the three months ended November 30, 2012 and 2011 totaled $100,688 and $74,246, respectively, resulting
in a net loss of $40,753 and net income of $4,367, respectively.
Cost
of revenue for the three months ended November 30, 2012 comprised of staff salaries of $138,315 and outsourced services expense
of $4,160. Cost of revenue for the three months ended November 30, 2011 comprised of staff salaries of $25,063 and related-party
consulting and professional fees of $37,387. Operating expenses for the three months ended November 30, 2012 comprised of officer
compensation for the CEO of $22,784, consulting and professional fees of $38,078, rent expense of $10,484, travel-related costs
of $7,435, corporate communications expense of $10,048, filing fees of $4,128, stock compensation expense of $3,385, and other
operating expenses of $4,346. For the three months ended November 30, 2011, operating expenses comprised of officer compensation
for the CEO of $22,532, consulting and professional fees of $26,725, rent expense of $11,680, web development expense of $4,500,
travel-related costs of $1,940, stock compensation expense of $2,344, and other operating expenses for $4,525.
For
the six months ended November 30, 2012 and 2011, the company had revenue of $453,210 and $190,700, respectively. Service
revenue from related party clients totaled zero and $3,000 for the same periods, respectively. Cost of revenue for the six
months ended November 30, 2012 and 2011 totaled $266,994 and $87,438, respectively. Operating expenses for the six months ended
November 30, 2012 and 2011 totaled $168,216 and $88,562, resulting in a net profit of $18,000 and $14,700, respectively.
Cost
of revenue for the six months ended November 30, 2012 comprised of staff salaries of $257,425 and outsourced services expense
of $9,569. Cost of revenue for the six months ended November 30, 2011 comprised of staff salaries of $25,063 and related-party
consulting and professional fees of $62,375. Operating expenses for the six months ended November 30, 2012 comprised of compensation
expense for the CEO of $49,071, professional and consulting fees of $44,878, rent expense of $20,625, travel-related expenses
of $13,221, corporate communications expense of $10,941, stock compensation expense of $7,135, filing fees of $5,937, web development
expense of $5,507, and other expenses of $10,901. For the six months ended November 30, 2011, operating expenses comprised of
officer compensation for the CEO of $27,032, consulting and professional fees of $28,861, rent expense of $13,814, web development
expense of $4,500, travel-related costs of $4,664, stock compensation expense of $2,708 and other operating expenses for $6,983.
5
Liquidity
and Capital Resources
As
of November 30, 2012, we had cash of $85,447 as compared to cash of $80,537 as of May 31, 2012. Net cash provided in operating
activities totaled $5,475 for the six months ended November 30, 2012. Net cash used in operating activities totaled $28,573 for
the six months ended November 30, 2011.
For
the six months ended November 30, 2012, net cash generated from operating activities was attributable to net income of $18,000,
a non-cash adjustment for depreciation expense of $625, and stock compensation expense of $7,135, offset by a net increase in
operating assets and liabilities of $20,285.
For
the six months ended November 30, 2011, net cash used in operating activities was attributable to a net income of $14,700 and
a non-cash adjustment for stock compensation expense of $2,708, offset by a net increase of operating assets and liabilities of
$45,981.
In
order for us to execute our business plan we will need to raise at least $500,000 in debt or equity. The funds are needed for
building out the management team, sales and marketing and working capital. There can be no assurance that we will be able to raise
the funds needed to execute our business plan.
If
we are unable to satisfy our cash requirements we may be unable to proceed with our plan of operations. We do not anticipate
the purchase or sale of any significant equipment. The foregoing represents our best estimate of our cash needs based on current
planning and business conditions. In the event we are not successful in reaching our initial revenue targets, additional
funds may be required, and we may not be able to proceed with our business plan for the development and marketing of our core
services. Should this occur, we will suspend or cease operations.
We
anticipate that depending on market conditions and our plan of operations, we may incur operating losses in the foreseeable future.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
N/A
ITEM
4T. CONTROLS AND PROCEDURES.
Evaluation
of Disclosure Controls and Procedures
. Under the supervision and with the participation of our management, including our
President, Chief Financial Officer and Secretary, we evaluated the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the
“Exchange Act”)) as of the end of the period covered by this report. Based upon that evaluation, our President, Chief
Financial Officer and Secretary concluded that our disclosure controls and procedures as of the end of the period covered by this
report were effective such that the information required to be disclosed by us in reports filed under the Securities Exchange
Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and
forms and (ii) accumulated and communicated to our management to allow timely decisions regarding disclosure. A controls
system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls
can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
Changes
in Internal Control Over Financial Reporting.
During the most recent quarter ended November 30, 2011, there has been no change
in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange
Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
6
PART II
ITEM
1. LEGAL PROCEEDINGS.
We were
not a party to any legal proceedings as of the date of filing of this Quarterly Report.
ITEM
1A. RISK FACTORS.
Our Annual
Report on Form 10K for the fiscal year ended May 31, 2012 contains a description of the risk factors relating to our operations
and to an investment in our common stock.
ITEM
2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
We did not
issue or sell any equity shares during the fiscal quarter covered by this Quarterly Report.
ITEM
3. DEFAULTS UPON SENIOR SECURITIES.
None
ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None
ITEM
5. OTHER INFORMATION.
On
September 26, 2012, the board of directors of the Company approved a stock dividend payable to the holders of its issued and outstanding
common stock, par value $.001 per share (the “Stock Dividend”). Under the terms of the Stock Dividend approved by
the board, the holders of the Company’s common stock as of September 28, 2012 (the “Record Date”) were issued
one (1) share of the Registrant’s common stock for each one (1) share owned by such holders on the Record Date. The Stock
Dividend was effective and payable on October 10, 2012 (the “Payment Date”).
As
a result of the Stock Dividend, 25,203,708 shares of the Registrant’s common stock were issued to the Registrant’s
shareholders of record as of the Record Date.
ITEM
6. EXHIBITS
Exhibit Number
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|
Description
of Exhibit
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|
|
|
31.1
|
|
Certifications
required by Rule 13a-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
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32.1
|
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Certification
of Chief Executive Officer and Principal Accounting Officer pursuant to 18 U.S.C.§ 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
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7
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.
Date: January 14,
2012
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Profit Planners Management, Inc.
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By: /s/ Wesley Ramjeet
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Wesley Ramjeet
Chief
Executive Officer, Chief Financial , Chief Accounting Officer,Officer and Director
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8
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