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AlumiFuel Power Corp - Quarter Report: 2008 April (Form 10-Q)

ihbt10q43008.htm



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

x
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended April 30, 2008
   
¨
TRANSITION REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______to_______


Commission File No. 333-57946

INHIBITON THERAPEUTICS, INC.
 (Exact Name of Registrant as Specified in its Charter)


Nevada
88-0448626
(State or other jurisdiction of
(IRS Employer
incorporation or organization)
Identification No.)

7315 East Peakview Avenue
Englewood, Colorado 80111
(Address of principal executive offices) (Zip code)

(303) 796-8940
(Registrant's telephone number including area code)

 (Former name, address and fiscal year)


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, and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by a 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 ¨
Accelerated filer ¨
Non-accelerated filer ¨
Smaller reporting companyx

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

Number of shares of common stock outstanding at June 16, 2008: 17,137,219

 
 
 


INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)

Index to Financial Statements
(Unaudited)


   
Page
     
Balance Sheets at April 30, 2008 (unaudited) and January 31, 2008
F-2
     
Statement of Operations for the three months ended April 30, 2008,
  
 
three months ended April 30, 2007, and from May 11, 2004 (Inception)
  
 
through April 30, 2008 (unaudited)
F-3
     
Statement of Changes in Shareholders' Deficit for the period from
  
 
May 11, 2004 (Inception) through April 30, 2008 (unaudited)
F-4
     
Statement of Cash Flows for the three months ended April 30, 2008,
  
 
three months ended April 30, 2007, and from May 11, 2004 (Inception)
  
 
through April 30, 2008 (unaudited)
F-5
     
Notes to Financial Statements
F-6
   
Item 2. Management’s Discussion and Analysis of Financial Condition and
  
 
Results of Operations
11
   
Part II – Other Information
13
   
Signatures
14
   



F-1

 
 
 

INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Balance Sheets

   
April 30,
    
January 31,
  
   
2008
    
2008
  
   
(Unaudited)
        
Assets
            
Cash
   $ 272     $ 21,023  
                 
Total assets
   $ 272     $ 21,023  
                 
Liabilities and Shareholders’ Deficit
                
Current liabilities:
                
Accounts and notes payable:
                
Accounts payable, related party (Note 2)
   $ 312,700     $ 305,200  
Accounts payable, other
     248,046       258,835  
Notes payable, related party (Note 2)
     353,725       380,542  
Notes payable, other (Note 3)
     35,200       35,200  
Accrued interest payable:
                
Notes payable, related party (Note 2)
     45,265       44,358  
Notes payable, other (Note 3)
     7,632       6,938  
                 
Total current liabilities
     1,002,568       1,031,073  
                 
Commitments and contingencies
     —          
                 
Shareholders’ deficit:
                
Preferred stock, $.001 par value; 10,000,000 shares authorized,
                
-0- shares issued and outstanding
     —       —  
Common stock, $.001 par value; 200,000,000 shares authorized,
                
17,137,219 (April 30) and 16,895,219 (January 31) shares
                
issued and outstanding
     17,137       16,895  
Additional paid-in capital
     1,929,195       1,861,437  
Common stock issued for prepaid services (Note 6)
     (116,667 )     (160,417 )
Deficit accumulated during the development stage
     (2,831,961 )     (2,727,965 )
                 
Total shareholders' deficit
     (1,002,296 )     (1,010,050 )
                 
Total liabilities and shareholders' deficit
   $ 272     $ 21,023  


See accompanying notes to condensed financial statements.
F-2
 
 
 

INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Condensed Statements of Operations
(Unaudited)

               
May 11, 2004
  
   
Three months
    
Three months
    
(Inception)
  
   
ended
    
ended
    
Through
  
   
April 30,
    
April 30,
    
April 30,
  
   
2008
    
2007
    
2008
  
                   
Operating costs and expenses:
                  
Research and development
   $ -     $ 75,000     $ 900,000  
Selling, general and administrative expenses
                        
Related party (Note 2)
     33,000       32,250       816,425  
Other (Note 4)
     63,211       65,613       644,114  
                         
Total operating costs and expenses
     (96,211 )     (172,863 )     (2,360,539 )
                         
Interest income
     -       -       80,183  
Interest expense (Notes 2 & 3)
     (7,785 )     (184,250 )     (551,605 )
                         
Loss before income taxes
     (103,996 )     (357,113 )     (2,831,961 )
                         
Income tax provision (Note 5)
     -       -       -  
                         
Net loss
   $ (103,996 )   $ (357,113 )   $ (2,831,961 )
                         
Basic and diluted loss per common share
   $ (0.01 )   $ (0.02 )        
                         
Weighted average common shares outstanding
     17,137,219       14,463,904          


See accompanying notes to condensed financial statements.
F-3
 
 
 

INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Condensed Statement of Changes in Shareholders’ Deficit
(Unaudited)
                     
Common stock
    
Deficit
        
               
Additional
    
issued for
    
accumulated
        
   
Common Stock
    
paid-in
    
prepaid
    
during the
        
   
Shares
    
Par value
    
capital
    
services
    
development stage
    
Total
  
Balance at May 11, 2004
                                    
Inception date
     —     $ —     $ —     $ —     $ —     $ —  
                                                 
October 2004 and January 2005,
                                                
sale of common stock
     9,555,100       9,555       269,945       —       —       279,500  
October 2004, issuance of common stock
                                          
for debt issue costs
     963,000       963       (63 )     —       —       900  
December 2004, issuance of common stock
                                          
for services
     107,000       107       893       —       —       1,000  
January 2005, conversion of notes payable to
                                          
common stock
     74,900       75       625       —       —       700  
Net loss
     —       —       —       —       (534,619 )     (534,619 )
Balance at January 31, 2005
     10,700,000       10,700       271,400       —       (534,619 )     (252,519 )
                                                 
February 2005 and March 2005,
                                                
sale of common stock
     428,000       428       99,572       —       —       100,000  
May 2005 Reverse acquisition of Organic
                                          
Soils.com, Inc.
     2,323,000       2,323       (47,179 )     —       —       (44,856 )
Net loss
     —       —       —       —       (664,190 )     (664,190 )
                                                 
Balance at January 31, 2006
     13,451,000       13,451       323,793       —       (1,198,809 )     (861,565 )
                                                 
July 2006 and August 2006,
                                                
sale of common stock, less
                                                
$7,500 of offering costs
     250,000       250       67,250       —       —       67,500  
Net loss
                             —       (527,029 )     (527,029 )
                              —                  
Balance at January 31, 2007
     13,701,000       13,701       391,043       —       (1,725,838 )     (1,321,094 )
                                                 
March 2007, conversion of convertible
                                                
promissory notes to common stock
     594,356       594       213,374       —       —       213,968  
Issuance of warrants upon conversion
                                                
of convertible promissory notes
     —       —       172,363       —       —       172,363  
March 2007, sale of common stock
     500,000       500       124,500       —       —       125,000  
April 2007, sale of common stock,
                                                
less $3,000 of offering costs
     100,000       100       26,900       —       —       27,000  
July 2007, conversion of convertible
                                                
promissory notes to common stock
     489,863       490       183,209       —       —       183,699  
Issuance of warrants upon conversion
                                                
of convertible promissory notes
     —       —       151,368       —       —       151,368  
July 2007, sale of common stock
     200,000       200       49,800       —       —       50,000  
August 2007, sale of common stock
     250,000       250       74,720       —       —       74,970  
October 2007, sale of common
                                                
stock
     200,000       200       59,770       —       —       59,970  
November 2007, sale of common stock
     210,000       210       59,790       —       —       60,000  
December 2007, stock issued for
                                                
consulting services
     500,000       500       174,500       (160,417 )     —       14,583  
December 2007, issuance of stock options
     —       —       140,250       —       —       140,250  
January 2008, sale of common stock
     150,000       150       39,850       —       —       40,000  
Net loss
     -       —       —       —       (1,002,127 )     (1,002,127 )
                                                 
Balance at January 31, 2008
     16,895,219     $ 16,895     $ 1,861,437       (160,417 )   $ (2,727,965 )   $ (1,010,050 )
                                                 
February 2008, sale of common stock
                                                
(Note 6)
     242,000       242       67,758       —       —       68,000  
April 2008, expense stock issued for
                                                
prepaid services in Dec 2007 (Note 6)
     —       —       —       43,750       —       43,750  
Net loss
     —       —       —       —       (103,996 )     (103,996 )
                                                 
Balance at April 30, 2008
     17,137,219     $ 17,137     $ 1,929,195       (116,667 )   $ (2,831,961 )   $ (1,002,296 )

See accompanying notes to condensed financial statements.
F-4
 
 
 

INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Condensed Statements of Cash Flows
(Unaudited)
 
               
May 11, 2004
  
   
Three months
    
Three months
    
(Inception)
  
   
ended
    
ended
    
Through
  
   
April 30,
    
April 30,
    
April 30,
  
   
2008
    
2007
    
2008
  
                   
Cash flows from operating activities:
                  
 Net loss
   $ (103,996 )   $ (357,113 )   $ (2,831,961 )
Adjustments to reconcile net loss to net cash
                        
used by operating activities:
                        
Stock based compensation
     —       —       316,250  
Common stock issued for prepaid services
     43,750       —       (116,667 )
Loss on debt extinguishment
     —       65,379       126,612  
Expense incurred upon issuance or modification
                        
of stock and warrants
     —       172,363       323,731  
Changes in operating assets and liabilities:
                        
Accounts payable
     (10,990 )     307       247,845  
Related party payables (Note 2)
     7,500       27,250       312,700  
Accrued expenses
     1,802       (2,427 )     99,153  
Net cash used in
                        
operating activities
     (61,934 )     (94,241 )     (1,522,337 )
                         
Cash flows from investing activities:
                        
Investment in Inhibitex Therapeutics, Inc.
     —       —       (44,856 )
Net cash used in
                        
investing activities
     —       —       (44,856 )
                         
Cash flows from financing activities:
                        
(Payments on) proceeds from related party notes
                        
payable, net (Note 2)
     (26,817 )     (57,048 )     342,325  
Proceeds from notes payable, other (Note 3)
     —       —       48,200  
Proceeds from convertible promissory note (Note 3)
     —       —       225,000  
Proceeds from issuance of common stock,
                        
net of offering costs (Note 6)
     68,000       152,000       951,940  
Net cash provided by
                        
financing activities
     41,183       94,952       1,567,465  
                         
Net change in cash and
                        
cash equivalents
     (20,751 )     711       272  
                         
Cash and cash equivalents:
                        
Beginning of period
     21,023       141       —  
                         
End of period
   $ 272     $ 852     $ 272  
                         
Supplemental disclosure of cash flow information:
                        
Cash paid during the period for:
                        
Income taxes
   $ —     $ —     $ —  
  Interest
   $ 6,183     $ 9,614     $ 48,554  
                         
Noncash financing transactions:
                        
Notes and interest payable converted to stock
   $ —     $ 148,589     $ 271,755  
Stock issued in exchange for debt issue costs
   $ —     $ —     $ 900  

See accompanying notes to condensed financial statements.
F-5
 
 
 
INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)
 
Note 1:  Basis of presentation

The interim unaudited financial statements presented herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in unaudited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The interim unaudited financial statements should be read in conjunction with the Company’s annual financial statements for the year ended January 31, 2008, notes and accounting policies thereto included in the Company’s Annual Report on Form 10-KSB as filed with the SEC.

In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary to provide a fair presentation of operating results for the interim periods presented have been made.  The results of operations for the periods presented are not necessarily indicative of the results to be expected for the year.

Interim financial data presented herein are unaudited.

Reorganization

Effective May 19, 2005, Organic Soils.com, Inc. (“Organic Soils.com”) entered into an Agreement and Plan of Reorganization with Inhibetex Therapeutics, Inc.  The Agreement provided for the reorganization of Inhibetex with Organic Soils.com, with the surviving entity adopting the name Inhibiton Therapeutics, Inc. (the “Company”).  In connection with the Agreement, Organic Soils.com acquired all of the issued and outstanding common shares of Inhibetex, on a fully-diluted basis, in exchange for 11,128,000 shares of Organic Soils.com common stock.  At the closing of the Agreement, the shareholders of Inhibetex held  82.7% of the outstanding common stock of Organic Soils.com, resulting in a change in control.

This acquisition was treated as a recapitalization of Inhibetex, with Organic Soils.com as the legal surviving entity.  Since Organic Soils.com had, prior to the recapitalization, minimal assets and no operations, the recapitalization has been accounted for as the sale of 2,323,000 shares of Organic Soils.com common stock for net assets of Inhibetex.  Costs of the transaction were charged to the period in which they were incurred.


 
F-6
 
INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)


Derivative Instruments

In connection with the issuances of equity instruments or debt, the Company may issue options or warrants to purchase common stock. In certain circumstances, these options or warrants may be classified as liabilities, rather than as equity. In addition, the equity instrument or debt may contain embedded derivative instruments, such as conversion options or listing requirements, which in certain circumstances may be required to be bifurcated from the associated host instrument and accounted for separately as a derivative liability instrument. The Company accounts for derivative instruments under the provisions of SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities".


Note 2:  Related Party

At April 30, 2008, the Company owed its officers a total of $312,700 for management services.  The Board of Directors has estimated the value of management services at the monthly rate of $8,000 and $2,000 for the president and treasurer, respectively.  The estimates were determined by comparing the level of effort to the cost of similar labor in the local market.

The Company rents office space, including the use of office machines, phone systems and long distance fees, from an affiliate at the rate of $1,000 per month, based on the amount of space occupied by the Company.  Rent expense totaled $3,000 for the three months ended April 30, 2008.

Accounts payable to related parties consisted of the following at April 30, 2008:

Management fees payable to officers
   $ 312,700  
         
Rent payable to company affiliated with officers
     -0-  
         
Total accounts payable, related party
   $ 312,700  


In periods prior to the three months ended April 30, 2008, the Company issued various promissory notes payable to a trust created by the president of the Company for the benefit of his children, in exchange for cash used for working capital purposes.   The notes bear an interest rate of 8% and are due on demand.  As of April 30, 2008, $274,612 in principal and $36,172 in accrued interest was outstanding on all notes payable to the trust.


 
F-7
 
INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)


During the three months ended April 30, 2008, the Company made payments of $26,817 on promissory notes payable to a company owned by the president.  The notes bear an interest rate of 8% per annum and are due on demand.  At April 30, 2008, $33,258 in principal and $4,876 in accrued interest remained outstanding on all notes payable to this affiliate.

At April 30, 2008, the Company owed $671 in principal and $28 in accrued interest on  promissory notes payable to the president.  The notes bear an interest rate of 8% per annum and are due on demand.

In periods prior to the three months ended April 30, 2008, the Company executed two promissory notes with companies affiliated with the Company’s officers.  These notes carry an interest rate of 8% per annum and are due on demand.  As of April 30, 2008, $26,684 in principal remained outstanding with accrued interest payable of $2,190.

During the quarter ended July 31, 2007, the Company executed a promissory note with a partnership affiliated with the Company’s president in the amount of $5,500.  This note carries an interest rate of 8% and is due on demand.  As of April 30, 2008, the entire balance of this note remains outstanding with accrued interest payable of $346.

During the year ended January 31, 2007, the Company executed a promissory note with a significant stockholder in exchange for $13,000.  The note bears 8% interest and is due on demand.  The entire balance of this note remained unpaid at April 30, 2008 with accrued interest payable of $1,653.

Notes and interest payable to related parties consisted of the following at April 30, 2008:

Notes payable to officers; interest at 8% and due on demand
   $ 671  
         
Notes payable to affiliates of Company officers; interest at 8% and due on demand
     340,054  
         
Note payable to significant stockholder; interest at 8% and due on demand
     13,000  
         
Notes payable, related party
     353,725  
         
Interest payable related party
     45,265  
         
Total principal and interest payable, related party
   $ 398,990  



 
F-8
 
INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)


Note 3: Notes Payable

During the year ended January 31, 2006, the Company received proceeds of $30,000, in exchange for a promissory note from an unaffiliated third party.  The entire balance of this note remained outstanding at April 30, 2008.  The promissory note was issued at an interest rate of 8% per annum and is due on demand.  Accrued interest payable on the note totaled $7,509 at April 30, 2008.  In January 2008, the holder of this note filed a lawsuit against the Company claiming the interest rate under this note was 44% and therefore the Company owed approximately $41,300 in interest payable at April 30, 2008.  The Company is disputing the claimed increased interest rate and intends to vigorously defend this lawsuit.  Should the Company not prevail in this action, the maximum exposure pursuant to the suit would be the disputed difference of approximately $33,800  in accrued interest on the note at April 30, 2008, plus any further interest expense at the increased interest rate for future periods until the matter is settled.


Note 4:  Other Expense

Other expense for the three month period ended April 30, 2008 and 2007, and for the period from May 11, 2004 (Inception) through April 30, 2008 consisted of the following:

   
Three months ended April 30, 2008
    
Three months ended April 30, 2007
    
May 11, 2004 (Inception) through April 30, 2008
  
General and administrative
   $ 3,197     $ 2,037     $ 31,470  
Legal and accounting
     664       (2,403 )     78,640  
Loss on debt extinguishment
     -       65,379       126,612  
Professional services
     59,350       600       251,559  
Stock based compensation
     -       -       155,833  
    $ 63,211     $ 65,613     $ 644,114  


Note 5:  Income Tax

The Company records its income taxes in accordance with Statement of Financial Accounting Standard No. 109, “Accounting for Income Taxes”.  The Company has incurred significant net operating losses since inception resulting in a deferred tax asset, which was fully allowed for; therefore, the net benefit and expense resulted in $-0- income taxes.



 
F-9
 
INHIBITON THERAPEUTICS, INC.
 (A Development Stage Company)
Notes to Condensed Financial Statements
(Unaudited)


Note 6:  Capital Stock

In February 2008, we issued 242,000 shares of our common stock to four unaffiliated accredited investors pursuant to a private placement.  The shares were sold for $68,000 or $0.28 per unit which consisted of one share of common stock and one common stock purchase warrant.  Each warrant is exercisable at $0.50 per share for a period of three years from the issuance date.

In December 2007, the Company issued 500,000 shares under its 2005 Stock Incentive Plan to an unaffiliated consultant in payment for a one-year consulting services agreement.  These shares were valued at the closing market price for the Company’s common stock on the issue date of $0.35 per share, or $175,000.  This amount was recorded as ”common stock issued for prepaid services” and will be expensed over the one year life of the consulting agreement as stock based compensation.  During the quarter ended April 30, 2008, we expensed $43,750 leaving a balance of $116,667 to be expensed through December 2008.




 
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Effective as of May 19, 2005, pursuant to an Agreement and Plan of Reorganization dated as of March 24, 2005 (the “Share Exchange Agreement”) by and between Organic Soils.com, Inc., a Nevada corporation (the “Company”) and Inhibetex Therapeutics, Inc., a Colorado corporation (“Inhibetex”), the Company and Inhibetex entered into a share exchange whereby all of the issued and outstanding capital stock of Inhibetex, on a fully-diluted basis, were exchanged for like securities of the Company, and whereby Inhibetex became a wholly owned subsidiary of the Registrant (the “Share Exchange”).  Contemporaneously, we changed our name to “Inhibiton Therapeutics, Inc.”

Upon completion of the Share Exchange, we ceased all operations relating to our historical business and adopted the business plan of Inhibetex, which is now our wholly owned subsidiary.  Inhibetex was incorporated on May 11, 2004 under the laws of the state of Colorado for the purpose of engaging in the discovery and development of novel cancer therapies.  Our focus is the research and development of new cancer therapeutic agents and cancer fighting drugs called targeted therapies.  We are conducting our research through a Cooperative Research and Development Agreement (“CRADA”) signed on September 30, 2004, with the Department of Veteran’s Affairs.  The research is conducted at the VA Medical Center in Tampa Florida under the direction of Dr. Mildred Acevedo-Duncan, who is affiliated with the University of South Florida and the Veteran’s Administration.

In general terms, the VA provides facilities, government furnished equipment and scientific skills and we provided funding of $75,000 quarterly for a period of three years ended September 2007.  Funding of the CRADA commenced in September 2004 and we have expensed a total of $900,000 in research and development costs as of April 30, 2008, $227,000 of which remained unpaid and is included in accounts payable as of that date.

While our unaudited financial statements are presented on the basis that we are a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable length of time, our independent auditor has raised a substantial doubt about our ability to continue as a going concern.

Our liquidity and capital resource needs are such that to address the going concern situation addressed in our unaudited financial statements at April 30, 2008, we will require approximately $350,000 of additional capital to fund the balance due under the CRADA as well as for general corporate working capital to fund our minimal day-to-day operations and costs associated with being a publicly-traded company.  This amount does not include any amounts which may be necessary to pay existing debt or accrued expenses.  We presently believe the source of funds will primarily consist of debt financing, which may include further loans from our officers or directors as detailed more fully in the accompanying unaudited financial statements, or the sale of our equity securities in private placements or other equity offerings or instruments.  During three months ended April 30, 2008, we received net proceeds of $68,000 in additional funds through equity sales.

 
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We can make no assurance that we will be successful in raising the funds necessary for our working capital requirements as suitable financing may not be available and we may not have the ability to sell our equity securities under acceptable terms or in amounts sufficient to fund our needs. Our inability to access various capital markets or acceptable financing could have a material effect on our results of operations, research and deployment of our business strategies and severely threaten our ability to operate as a going concern.

During the remainder of our fiscal year and for the foreseeable future, we will be concentrating on raising the necessary working capital through acceptable debt facilities and equity financing to insure our ability to continue our research and implement other business strategies.  To the extent that additional capital is raised through the sale of equity or equity related securities, the issuance of such securities could result in significant dilution of our current shareholders.

Our results of operations for the period ended April 30, 2008 as compared to April 30, 2007 were affected by the fact we no longer are paying or accruing research and development fees under the CRADA.  Without those fees our operating costs remained stable at $96,211 for the three months ended April 30, 2008 as compared to $97,863 for the three months ended April 30, 2007.  Interest expense decreased significantly in the three months ended April 30, 2008 as compared to the same period on 2007 given there was $172,363 in interest expense recorded in the 2007 period related to the fair value of warrants issued on the conversion of certain promissory notes.  In the absence of that amount, interest expense in the 2007 period was $11,887.

Off-Balance Sheet Arrangements.  During the three months ended April 30, 2008, the Company did not engage in any off-balance sheet arrangements and defined in Item 303(a)(4) of the SEC’s Regulation S-B.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable

Item 4T. Controls and Procedures

Management of the Company is responsible for establishing and maintaining an adequate system of internal control over financial reporting (as such term is defined in Rules 13a-15(f)).  Under the supervision and with the participation of Henry Fong, our Chief Executive Officer who is also our Principal Executive Officer and Principal Accounting Officer, we conducted an evaluation and effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13(a)-15(e) and 15(d)-15(e) under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this report (the “Evaluation Date”).  Based on this evaluation, our chief executive officer concluded that, as of the Evaluation Date, our disclosure controls and procedures are effective such that the information relating to us required to be disclosed with our with the Securities and Exchange Commission (“SEC”) reports is (i) recorded, processed, summarized and reported within the time period specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer, as appropriate to allow timely decisions requiring timely disclosure.

 
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Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.  Because of its inherit limitations, internal control over financial reporting may not prevent or detect misstatements.  Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.  In evaluating the effectiveness of our internal control over financial reporting, our management used the criteria set forth in “Internal Control-Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).  Based on this evaluation, our management concluded, as of January 31, 2008, our internal control over financial reporting was effective based on those criteria.  There were no changes in internal controls during the period covered by this report.

This quarterly report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this annual report.


PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 2. Unregistered Sales of Equity Securities

None.

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

Exhibits:
  
31.1
CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 
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SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


 
INHIBITON THERAPEUTICS, INC.
 
(Registrant)

Date: June 20, 2008
By: /s/ Henry Fong 
 
Henry Fong
 
Principal Executive Officer and
Principal Financial Officer
   
 
 

 
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