|
|
|||
ASSETS
|
|
|||
|
|
|||
CURRENT
ASSETS:
|
||||
Inventories
|
$
|
29,101
|
||
Prepaid
expenses and other current assets
|
200,270
|
|||
Total
current assets
|
229,371
|
|||
|
||||
Property
and equipment—net
|
35,358
|
|||
Other
long-term assets
|
2,087
|
|||
TOTAL
ASSETS
|
$
|
266,816
|
||
|
||||
|
||||
CURRENT
LIABILITIES:
|
||||
Bank
overdraft
|
$
|
28,211
|
||
Accounts
payable
|
206,646
|
|||
Note
payable—related party (see Note 4)
|
50,140
|
|||
Accrued
expenses and other current liabilities
|
220
|
|||
Total
current liabilities
|
285,217
|
|||
Total
liabilities
|
285,217
|
|||
|
||||
Commitments
(see Note 8)
|
||||
|
||||
STOCKHOLDERS’
DEFICIT:
|
||||
Common
stock ($0.001 par value, 100,000,000 shares authorized; 19,492,759
shares
issued and outstanding)
|
19,493
|
|||
Additional
paid-in capital
|
758,220
|
|||
Deferred
stock compensation
|
(89,256
|
)
|
||
Accumulated
deficit
|
(706,858
|
)
|
||
Total
stockholders’ deficit
|
(18,401
|
)
|
||
TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
$
|
266,816
|
|
|
|
|||||
|
|
Period
from
|
|||||
|
|
January
27, 2005
|
|||||
|
Three
Months Ended
|
(inception)
through
|
|||||
|
September
30,
|
September
30,
|
|||||
|
2005
|
2005
|
|||||
REVENUES
|
$
|
—
|
$
|
—
|
|||
COST
OF GOODS SOLD
|
—
|
—
|
|||||
Gross
profit
|
—
|
—
|
|||||
|
|||||||
OPERATING
EXPENSES:
|
|||||||
Selling
and marketing
|
25,839
|
33,790
|
|||||
Technology,
support, and development
|
122,157
|
139,464
|
|||||
General
and administrative
|
240,033
|
533,654
|
|||||
Total
operating expenses
|
388,029
|
706,908
|
|||||
Operating
income (loss)
|
(388,029
|
)
|
(706,908
|
)
|
|||
|
|||||||
OTHER
INCOME (EXPENSE):
|
|||||||
Other
income
|
270
|
270
|
|||||
Interest
expense-net
|
(220
|
)
|
(220
|
)
|
|||
|
|||||||
Total
other (expense) income
|
50
|
50
|
|||||
NET
INCOME (LOSS)
|
$
|
(387,979
|
)
|
$
|
(706,858
|
)
|
|
|
|||||||
EARNINGS
(LOSS) PER COMMON SHARE, SHARE, BASIC AND DILUTED
|
$
|
(0.02
|
)
|
$
|
(0.04
|
)
|
|
|
|||||||
WEIGHTED
AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND
DILUTED
|
19,218,999
|
16,597,011
|
|
|
|||
|
Period
from
|
|||
|
January
27, 2005
|
|||
|
(inception)
through
|
|||
|
September
30,
|
|||
|
2005
|
|||
Net
income (loss)
|
$
|
(706,858
|
)
|
|
Adjustments:
|
||||
Depreciation
|
3,594
|
|||
Amortization
of deferred stock compensation
|
9,657
|
|||
Changes
in:
|
||||
Accounts
receivable
|
(270
|
)
|
||
Inventories
|
(29,101
|
)
|
||
Prepaid
expenses and other current assets
|
(200,000
|
)
|
||
Other
long-term assets
|
(2,087
|
)
|
||
Bank
overdraft
|
28,211
|
|||
Accounts
payable
|
206,646
|
|||
Accrued
expenses and other current liabilities
|
220
|
|||
Total adjustments
|
16,870
|
|||
Net
cash used by operating activities
|
(689,988
|
)
|
||
|
||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||
Purchase
of equipment
|
(38,952
|
)
|
||
|
||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||
Proceeds
from issuance of common stock
|
678,800
|
|||
Proceeds
from issuance of note payable
|
50,140
|
|||
Net
cash provided by financing activities
|
728,940
|
|||
|
||||
NET
INCREASE (DECREASE) IN CASH
|
—
|
|||
|
||||
CASH,
BEGINNING OF PERIOD
|
—
|
|||
CASH,
END OF PERIOD
|
$
|
—
|
||
|
||||
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION:
|
||||
Cash
paid for interest
|
$
|
—
|
||
Cash
paid for income taxes
|
$
|
—
|
1.
|
Organization
And Basis Of
Presentation
|
A.
|
Organization
|
B.
|
Basis
of Presentation
|
2.
|
Summary
of Significant Accounting
Policies
|
A.
|
Predecessor
Entity
|
B.
|
Use
of Estimates
|
C.
|
Cash
and Cash Equivalents
|
D.
|
Accounts
Receivable
|
E.
|
Customer
Concentrations
|
F.
|
Inventories
|
G.
|
Property
and Equipment
|
H.
|
Revenue
Recognition
|
I.
|
Technology
License
|
J.
|
Fair
Value of Financial Instruments
|
K.
|
Stock-Based
Compensation
|
|
Period
from
inception
through
September
30,
2005
|
|||
Net
income (loss), as reported
|
$
|
(706,858
|
)
|
|
Add:
Stock-based compensation expense included in net income, no tax
effect
|
—
|
|||
Deduct:
Total stock-based compensation expense determined under fair value
method
for all awards, no tax effect
|
(8,242
|
)
|
||
Pro
forma net income (loss)
|
$
|
(715,100
|
)
|
L.
|
Income
Taxes
|
M.
|
Basic
and Diluted Net Earnings (loss) per
Share
|
N.
|
Comprehensive
Loss
|
O.
|
Recent
Accounting Pronouncements
|
3.
|
Going
Concern
|
4.
|
Notes
Payable
|
5.
|
Other
Current Assets
|
6.
|
Stockholders'
Equity
|
A.
|
Common
Stock
|
|
Number
of
Shares
|
Weighted
Average
Exercise
Price
|
Exercisable
|
|||||||
Outstanding
at January 27, 2005 (inception)
|
—
|
$
|
—
|
—
|
||||||
Issued
|
1,900,000
|
0
.66
|
1,900,000
|
|||||||
Cancelled,
forfeited or expired
|
—
|
|
—
|
|||||||
Outstanding
at September 30, 2005
|
1,900,000
|
$
|
0.66
|
1,400,000
|
||||||
Weighted
average fair market value of warrants issued:
|
$
|
1.00
|
Outstanding
|
Exercisable
|
|||||||||||||||
Exercise
Price
|
Number
of
Warrants
|
Weighted
Average
Remaining
Contractual
Life
(Years)
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
|
Weighted
Average
Exercise
Price
|
|||||||||||
$0.70
|
1,300,000
|
5.0
|
$
|
0.70
|
1,300,000
|
$
|
0.70
|
|||||||||
|
||||||||||||||||
$0.60
|
600,000
|
5.0
|
$
|
0.60
|
100,000
|
$
|
0.60
|
7.
|
Income
Taxes
|
8.
|
Commitments
and Contingencies
|
A.
|
Legal
Actions
|
B.
|
OEM
License Agreements
|
2006
|
$
|
450,000
|
||
2007
|
540,000
|
|||
2008
|
648,000
|
|||
2009
|
777,600
|
|||
2010
|
933,120
|
|||
|
$
|
3,348,720
|
C.
|
Operating
Lease
|
D.
|
Indemnities
and Guarantees
|
9.
|
Other
Related Party
Transactions
|
A.
|
OEM
License Agreement - Liquid Stone Manufacturing,
Inc.
|
B.
|
OEM
License Agreement - Stone Mountain Finishes,
Inc.
|
10.
|
Consultants
|
C.
|
Trademark
License and Contract Assignment and Assumption Agreement - Aronite
Industries, Inc.
|
D.
|
Boston
Equities Corporation Consulting
Services
|
a)
|
Exhibits
- None.
|
b)
|
Reports
on Form 8-K
|