PEREGRINE INDUSTRIES INC - Annual Report: 2011 (Form 10-K)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 10-K
_________________________________
ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2011
¨
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No.:
0-27511
PEREGRINE INDUSTRIES, INC.
(Exact Name Of Registrant
As Specified In Its Charter)
| Florida | 65-0611007 |
| (State of Incorporation) | (I.R.S. Employer Identification No.) |
| 40 Wall Street, 28th Floor | 10005 |
| (Address of Principal Executive Offices) | (ZIP Code) |
Registrant's Telephone Number, Including Area Code: (212) 400-7198 |
|
Securities Registered Pursuant to Section 12(g) of The Act: Common Stock, $0.0001 |
|
Indicate if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of
the Securities Act. Yes ¨ No x
Indicate if the Registrant is not required to file reports pursuant to Section 13 or
Section 15(d) of the Act. Yes ¨ No
x
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 x No ¨
Indicate if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of the registrant's knowledge, in
the definitive proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. ¨
On June 30, 20
Indicate whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act) or a smaller reporting company .
| Large accelerated filer ¨ | Accelerated filer ¨ | Non-Accelerated filer ¨ | Smaller reporting company x |
Indicate whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨
PART I
ITEM 1. DESCRIPTION OF BUSINESS Back to Table of Contents
Some of the statements contained in this Form 10-K of Peregrine Industries, Inc. (hereinafter the "Company", "We" or the "Registrant") discuss future expectations, contain projections of our plan of operation or financial condition or state other forward-looking information. In this registration statement, forward-looking statements are generally identified by the words such as "anticipate", "plan", "believe", "expect", "estimate", and the like. Forward-looking statements involve future risks and uncertainties, there are factors that could cause actual results or plans to differ materially from those expressed or implied. These statements are subject to known and unknown risks, uncertainties, and other factors that could cause the actual results to differ materially from those contemplated by the statements. The forward-looking information is based on various factors and is derived using numerous assumptions. A reader, whether investing in the Company's securities or not, should not place undue reliance on these forward-looking statements, which apply only as of the date of this Annual Report. Important factors that may cause actual results to differ from projections include, for example:
| - | the success or failure of management's efforts to implement the Registrant's plan of operation; |
| - | the ability of the Registrant to fund its operating expenses; |
| - | the ability of the Registrant to compete with other companies that have a similar plan of operation; |
| - | the effect of changing economic conditions impacting our plan of operation; |
| - | the ability of the Registrant to meet the other risks as may be described in future filings with the SEC. |
Organizational History and General Background of the Registrant
The Company was incorporated in Florida in 1995 for the purpose of designing and manufacturing heat pump pool heaters, residential air conditioners and parallel flow coils for the heating, ventilation and air conditioning industry. In June 2002, the Registrant and its subsidiaries filed a petition for bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida. The Company emerged from bankruptcy in March 2004 free and clear of all liens, claims and obligations.
Business Objectives of the Registrant
As a result of the bankruptcy proceeding, the Registrant has no present operations. Management determined to direct its efforts and limited resources to pursue and effect a business combination.
Current trends
Management believes that as a result of the relative uncertainty in the United States equity markets over the past few years, many privately-held companies have been closed off from the public market and traditional IPO's. During the past few years, many privately-held or public companies attempted to divest non-core assets and divisions and valuations of these assets and divisions have decreased significantly. Therefore, Management believes that there are substantial business opportunities to effect attractive acquisitions. As a public entity with its shares of common stock registered under the Exchange Act and publicly trading, Management believes to be well positioned to identify target acquisitions and to effect a business combination in order to take advantage of these current trends.
Effecting a business combination
Prospective investors in the Company's common stock will invest in the Company without an opportunity to evaluate the specific merits or risks of any one or more business combinations. A business combination may involve the acquisition of, or merger with, a company which needs to raise substantial additional capital by means of being a publicly trading company, while avoiding what it may deem to be adverse consequences of undertaking a public offering itself. These include time delays, significant expense, loss of voting control and compliance with various Federal and state securities laws. A business combination may involve a company which may be financially unstable or in its early stages of development or growth.
The Registrant has not identified a target business or target industry
The Company's effort in identifying a prospective target business will not be limited to a particular industry and the Company may ultimately acquire a business in any industry Management deems appropriate. To date, the Company has not selected any target business on which to concentrate our search for a business combination. While the Company intends to focus on target businesses in the United States, we are not limited to those entities and may consummate a business combination with a target business outside of the United States. Accordingly, there is no basis for investors in the Company's common stock to evaluate the possible merits or risks of the target business or the particular industry in which we may ultimately operate. To the extent we effect a business combination with a financially unstable company or an entity in its early stage of development or growth, including entities without established records of sales or earnings, we may be affected by numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, to the extent that we effect a business combination with an entity in an industry characterized by a high level of risk, we may be affected by the currently unascertainable risks of that industry. An extremely high level of risk frequently characterizes many industries which experience rapid growth. In addition, although the Company's Management will endeavor to evaluate the risks inherent in a particular industry or target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
Sources of target businesses
The Registrant anticipates that target business candidates will be brought to our attention from various unaffiliated sources, including securities broker-dealers, investment bankers, venture capitalists, bankers and other members of the financial community, who may present solicited or unsolicited proposals. Our Management may also bring to our attention target business candidates. While we do not presently anticipate engaging the services of professional firms that specialize in business acquisitions on any formal basis, we may engage these firms in the future, in which event we may pay a finder's fee or other compensation. In no event, however, will we pay Management any finder's fee or other compensation for services rendered to us prior to or in connection with the consummation of a business combination.
Selection of a target business and structuring of a business combination
Officers and directors owns 40.62% of the issued and outstanding shares and will have broad flexibility in identifying and selecting a prospective target business. In evaluating a prospective target business, our Management will consider, among other factors, the following:
- financial condition and results of operation of the target company;
- growth potential;
- experience and skill of management and availability of additional personnel;
- capital requirements;
- competitive position;
- stage of development of the products, processes or services;
- degree of current or potential market acceptance of the products, processes or services;
- proprietary features and degree of intellectual property or other protection of the
products, processes or services;
- regulatory environment of the industry; and
- costs associated with effecting the business combination.
These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination will be based, to the extent relevant, on the above factors as well as other considerations deemed relevant by our Management in effecting a business combination consistent with our business objective. In evaluating a prospective target business, we will conduct a due diligence review which will encompass, among other things, meetings with incumbent management and inspection of facilities, as well as review of financial and other information which will be made available to us.
We will endeavor to structure a business combination so as to achieve the most favorable tax treatment to us, the target business and both companies' stockholders. We cannot assure you, however, that the Internal Revenue Service or appropriate state tax authority will agree with our tax treatment of the business combination.
The time and costs required to select and evaluate a target business and to structure and complete the business combination cannot presently be ascertained with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which a business combination is not ultimately completed will result in a loss to us.
Probable lack of business diversification
We may seek to effect business combinations with more than one target business, it is probable that we will have the ability to effect only a single business combination. Accordingly, the prospects for our success may be entirely dependent upon the future performance of a single business. Unlike other entities which may have the resources to complete several business combinations of entities operating in multiple industries or multiple areas of a single industry, it is probable that we will not have the resources to diversify our operations or benefit from the possible spreading of risks or offsetting of losses. By consummating a business combination with only a single entity, our lack of diversification may:
- subject us to numerous
economic, competitive and regulatory developments, any or all of which may have a
substantial adverse impact upon the particular industry in which we may operate subsequent
to a business combination, and
- result in our dependency upon the development or market acceptance of a single or
limited number of products, processes or services.
Limited ability to evaluate the target business' management
Although we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting a business combination, we cannot assure you that our assessment of the target business' management will prove to be correct. In addition, we cannot assure you that the future management will have the necessary skills, qualifications or abilities to manage a public company intending to embark on a program of business development. Furthermore, the future role of our directors, if any, in the target business cannot presently be stated with any certainty. While it is possible that one or more of our directors will remain associated in some capacity with us following a business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to a business combination. Moreover, we cannot assure you that our directors will have significant experience or knowledge relating to the operations of the particular target business.
Following a business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.
Competition
In identifying, evaluating and selecting a target business, we expect to encounter intense competition from other entities having a business objective similar to ours. Many of these entities are well established and have extensive experience identifying and effecting business combinations directly or through affiliates. Many of these competitors possess greater technical, human and other resources than us and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous potential target businesses, our ability to compete in acquiring certain sizable target businesses will be limited by our limited financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of a target business. Further, any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination. Our management believes, however, that our status as a public entity and potential access to the United States public equity markets may give us a competitive advantage over privately-held entities having a similar business objective as us in acquiring a target business with significant growth potential on favorable terms.
If we succeed in effecting a business combination, there will be, in all likelihood, intense competition from competitors of the target business. In particular, certain industries which experience rapid growth frequently attract an increasingly larger number of competitors, including competitors with increasingly greater financial, marketing, technical and other resources than the initial competitors in the industry. The degree of competition characterizing the industry of any prospective target business cannot presently be ascertained. We cannot assure you that, subsequent to a business combination, we will have the resources to compete effectively, especially to the extent that the target business is in a high-growth industry.
Employees
Mr. Rubin, our CEO and CFO, is our sole executive officer. Mr. Rubin is not obligated to contribute any specific number of hours per week and intend to devote only as much time as they deem necessary to the Company's affairs. The amount of time they will devote in any time period will vary based on the availability of suitable target businesses to investigate. We do not intend to have any full time employees prior to the consummation of a business combination.
ITEM 1A. RISK FACTORS RELATED TO OUR BUSINESS Back to Table of Contents
FORWARD-LOOKING STATEMENTS
This Form 10-K contains forward-looking statements that are based on current expectations,
estimates, forecasts and projections about us, our future performance, the market in which
we operate, our beliefs and our management's assumptions. In addition, other written or
oral statements that constitute forward-looking statements may be made by us or on our
behalf. Words such as "expects", "anticipates", "targets",
"goals", "projects", "intends", "plans",
"believes", "seeks", "estimates", variations of such words
and similar expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and involve certain risks,
uncertainties and assumptions that are difficult to predict or assess. Therefore, actual
outcomes and results may differ materially from what is expressed or forecast in such
forward-looking statements.
DEPENDENCE ON KEY PERSONNEL
The Registrant is dependent upon the continued services of its officers and directors.
To the extent that their services become unavailable, the Registrant will be required to
obtain other qualified personnel and there can be no assurance that it will be able to
recruit and hire qualified persons upon acceptable terms.
LIMITED RESOURCES; NO PRESENT SOURCE OF
REVENUES.
At present, we have limited business operations and our business activities are limited to
seeking potential business opportunities. Due to our limited financial and personnel
resources, there is only a limited basis upon which to evaluate our prospects for
achieving our intended business objectives. We have only limited resources and have no
operating income, revenues or cash flow from operations. Our Management or a related party
is providing us with limited funding, on an as needed basis, necessary for us to
continue our corporate existence and our business objective to seek new business
opportunities, as well as funding the costs, including professional accounting fees, in
order to continue to be a reporting company under the Exchange Act. We have no written
agreement with our Management or related parties to provide any interim financing for any
period. In addition, we will not generate any revenues unless and until we enter
into a new business, of which there can be no assurance.
BROAD DISCRETION OF MANAGEMENT
Any person who invests in our securities will do so without an opportunity to evaluate the
specific merits or risks of any potential new prospective business in which we may engage.
As a result, investors will be entirely dependent on the broad discretion and judgment of
Management in connection with the selection of a prospective business. There can be no
assurance that determinations made by our Management will permit us to achieve our
business objectives.
ABSENCE OF SUBSTANTIVE DISCLOSURE RELATING TO PROSPECTIVE BUSINESS
We have not yet identified any prospective business or industry in which we may seek to
become involved and at present we have no information concerning any prospective
business. There can be no assurance that any prospective business opportunity will benefit
shareholders or prove to be more favorable to shareholders than any other investment that
may be made by shareholders and investors.
THERE IS NO LIQUID MARKET FOR OUR COMMON STOCK AND NONE MAY DEVELOP OR BE
SUSTAINED
The Registrant's common stock is subject to quotation on the FINRA Bulletin Board under the symbol PGID.
There is currently no liquid trading market in our common stock. There can be no assurance
that there will be a liquid trading market for our common stock following commencement of
a new business. In the event that a liquid trading market commences, there can be no
assurance as to the market price of our shares of common stock, whether any trading market
will provide sufficient liquidity to investors, or whether any trading market will be
sustained.
UNSPECIFIED INDUSTRY FOR NEW PROSPECTIVE BUSINESS OPPORTUNITIES; UNASCERTAINABLE
RISKS
There is no basis for shareholders to evaluate the possible merits or risks of potential
new business opportunities or the particular industry in which we may ultimately operate.
To the extent that we effect a business combination with a financially unstable entity or
an entity that is in its early stage of development or growth, including entities without
established records of revenues or income, we will become subject to numerous risks
inherent in the business and operations of that financially unstable company. In addition,
to the extent that we effect a business combination with an entity in an industry
characterized by a high degree of risk, we will become subject to the currently
unascertainable risks of that industry. A high level of risk frequently characterizes
certain industries that experience rapid growth. Although Management will endeavor to
evaluate the risks inherent in a particular new prospective business or industry, there
can be no assurance that we will properly ascertain or assess all such risks or that
subsequent events may not alter the risks that we perceive at the time of the consummation
of any new business opportunity.
CONFLICTS OF INTEREST
Our Management is not required to commit their full
time to our affairs. There may be a conflict of interest in allocating their time in the
event that Management engages in similar business efforts for other entities. Our
Management will devote such time, in their sole discretion, to conduct our business,
including the evaluation of potential new business opportunities. As a result, the amount
of time devoted to our business and affairs may vary significantly depending upon whether
we have identified a new prospective business opportunity or are engaged in active
negotiations related to a new business. In the event that a conflict of interest shall
arise, Management will consider factors such as availability of audited financial
statements, current capitalization and the laws of jurisdictions. If several business
opportunities or operating entities approach Management with respect to a business
combination, Management will consider the foregoing factors as well as the preferences of
the Management. However, Management will act in what they believe will be in the best
interests of the shareholders of the Registrant. The Registrant shall not enter into a
transaction with a target business that is affiliated with Management.
COMPETITION
We expect to encounter intense competition from other entities seeking to pursue new
business opportunities. Many of these entities are well-established and have
extensive experience in identifying new prospective business opportunities. Many of these
competitors possess greater financial, technical, human and other resources than we do and
there can be no assurance that we will have the ability to compete successfully. Based
upon our limited financial and personnel resources, we may lack the resources as compared
to those of many of our potential competitors.
ADDITIONAL FINANCING REQUIREMENTS
We have no revenues and are dependent upon the willingness of Management or related
parties to fund the costs associated with the reporting obligations under the Exchange
Act, and other administrative costs associated with our corporate existence. As of
the date of this filing, the Registrant has paid for general and administrative expenses,
including accounting fees, reinstatement fees, and other professional fees related to the
preparation and filing of reports under the Exchange Act. We may not generate any revenues
unless and until the commencement of new business operations. We believe that we will have
sufficient funds available to pay accounting and professional fees and other expenses to
fulfill our reporting obligations under the Exchange Act until we commence business
operations. In the event that our available funds from our Management or affiliates prove
to be insufficient, we will be required to seek additional financing. Our failure to
secure additional financing could have a material adverse affect on our ability to pay the
accounting and other fees in order to continue to fulfill our reporting obligations and
pursue our business plan. We do not have any arrangements with any bank or financial
institution to secure additional financing and there can be no assurance that any such
arrangement would be available on terms acceptable and in our best interests. We do not
have any written agreement with our affiliates to provide funds for our operating
expenses.
STATE BLUE SKY REGISTRATION; POTENTIAL LIMITATIONS ON RESALE OF THE SECURITIES
The holders of our shares of common stock and those persons who desire to purchase them in
any trading market that might develop, should be aware that there may be state blue-sky
law restrictions upon the ability of investors to resell our securities. Accordingly,
investors should consider the secondary market for the Registrant's securities to be a
limited one.
It is the present intention of the Registrant's management after the commencement of new business operations to seek coverage and publication of information regarding the Registrant in an accepted publication manual which permits a manual exemption. The manual exemption permits a security to be distributed in a particular state without being registered if the Registrant issuing the security has a listing for that security in a securities manual recognized by the state. However, it is not enough for the security to be listed in a recognized manual. The listing entry must contain (1) the names of issuer's officers, and directors, (2) an issuer's balance sheet, and (3) a profit and loss statement for either the fiscal year preceding the balance sheet or for the most recent fiscal year of operations. Furthermore, the manual exemption is a nonissuer exemption restricted to secondary trading transactions, making it unavailable for issuers selling newly issued securities.
Most of the accepted manuals are those published in Standard and Poor's, Moody's Investor Service, Fitch's Investment Service, and Best's Insurance Reports, and many states expressly recognize these manuals. A smaller number of states declare that they "recognize securities manuals" but do not specify the recognized manuals. The following states do not have any provisions and therefore do not expressly recognize the manual exemption: Alabama, Georgia, Illinois, Kentucky, Louisiana, Montana, South Dakota, Tennessee, Vermont and Wisconsin.
DIVIDENDS UNLIKELY
We do not expect to pay dividends for the foreseeable future because we have no revenues.
The payment of dividends will be contingent upon our future revenues and earnings, if any,
capital requirements and overall financial condition. The payment of any future dividends
will be within the discretion of our board of directors. It is our expectation that after
the commencement of new business operations that future management will determine to
retain any earnings for use in business operations and accordingly, we do not anticipate
declaring any dividends in the foreseeable future.
POSSIBLE ISSUANCE OF ADDITIONAL SECURITIES
Our Articles of Incorporation, as amended, authorize the issuance of 100,000,000 shares of
common stock, par value $0.0001. As of June 30, 2011, we had 524,200 shares issued and
outstanding. We may be expected to issue additional shares in connection with our pursuit
of new business opportunities and new business operations. To the extent that additional
shares of common stock are issued, our shareholders would experience dilution of their
respective ownership interests. If we issue shares of common stock in connection with our
intent to pursue new business opportunities, a change in control of the Registrant may be
expected to occur. The issuance of additional shares of common stock may adversely affect
the market price of our common stock, in the event that an active trading market
commences.
COMPLIANCE WITH PENNY STOCK RULES
Our securities will be considered a "penny stock" as defined in the
Exchange Act and the rules thereunder, unless the price of our shares of common stock is
at least $5.00. We expect that our share price will be less than $5.00. Unless our common
stock is otherwise excluded from the definition of "penny stock", the penny
stock rules apply. The penny stock rules require a broker-dealer, prior to a transaction
in penny stock not otherwise exempt from the rules, to deliver a standardized risk
disclosure document that provides information about penny stocks and the nature and level
of risks in the penny stock market. The broker-dealer also must provide the customer with
current bid and offer quotations for the penny stock, the compensation of the
broker-dealer and its sales person in the transaction, and monthly account statements
showing the market value of each penny stock held in the customer's account. In addition,
the penny stock rules require that the broker-dealer, not otherwise exempt from such
rules, must make a special written determination that the penny stock is suitable for the
purchaser and receive the purchaser's written agreement to the transaction. These
disclosure rules have the effect of reducing the level of trading activity in the
secondary market for a stock that becomes subject to the penny stock rules. So long as the
common stock is subject to the penny stock rules, it may become more difficult to sell
such securities. Such requirements could limit the level of trading activity for our
common stock and could make it more difficult for investors to sell our common stock.
ITEM 1B. UNRESOLVED STAFF COMMENTS Back to Table of Contents
As of the filing of this annual report on Form 10-K, there were no material unresolved comments from the staff of the Securities and Exchange Commission.
ITEM 2. DESCRIPTION OF PROPERTIES Back to Table of Contents
The Registrant's corporate office is located at 40 Wall Street, 28th Floor, New York, NY 10005. The office facilities consist of approximately 300 square feet of executive office space and are leased from a related party. The Registrant believes that the office facilities are sufficient for the foreseeable future and this arrangement will remain until we find a new business opportunity or consummate a business combination.
ITEM 3. LEGAL PROCEEDING Back to Table of Contents
None.ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
Back to Table of ContentsNone.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTER Back to Table of Contents
(a) Market Price Information
Our
common stock is currently quoted on the FINRA Bulletin Board under the symbol PGID, an
NASD-sponsored and operated inter-dealer automated quotation system for equity securities
not included on The Nasdaq Stock Market. Quotation of the Company's securities on the
FINRA Bulletin Board limits the liquidity and price of the Company's common stock more
than if the Company's shares of common stock were listed on The Nasdaq Stock Market or a
national exchange. For the periods indicated, the following table sets forth the high and
low bid prices per share of common stock. The below prices represent inter-dealer
quotations without retail markup, markdown, or commission and may not necessarily
represent actual transactions.
Fiscal 2011 |
Fiscal 2010 |
Fiscal 2009 |
||||||||||||||||
High |
Low |
High |
Low |
High |
Low |
|||||||||||||
First Quarter ended September 30 |
$ |
3.99 |
$ |
0.11 |
$ |
0.10
|
$ |
0.05
|
$ |
0.30
|
$ |
0.0001 |
||||||
Second Quarter ended December 31 |
$ |
1.01
|
$ |
0 .11 |
$ |
0.05
|
$ |
0.03
|
$ |
0.10
|
$ |
0.08
|
||||||
Third Quarter ended March 31 |
$ |
1.01 |
$ |
0.11 |
$ |
0.04
|
$ |
0.02
|
$ |
0.10
|
$ |
0.05
|
||||||
Fourth Quarter ended June 30 |
$ | 1 .55 |
$ | 1 .01 |
$ |
0.04
|
$ |
0.03
|
$ |
0.10
|
$ |
0.05
|
||||||
(b) As of June 30, 2011, our shares of common stock were held by approximately 180 stockholders of record. The transfer agent of our common stock is Pacific Stock Transfer.
(c) Dividends
We currently do not pay cash dividends on our common stock and have no plans to reinstate
a dividend on our common stock.
(d) Sale of Unregistered
Securities
The Registrant has not issued any restricted shares of common stock during the fourth
quarter ended June 30, 2011.
(e) Equity Compensation Plans
We have no equity compensation plans.
ITEM 6. SELECTED FINANCIAL DATA Back to Table of Contents
| Operating Results Data: | 2011 | 2010 | ||
| Revenues | $ | 0 | $ | 0 |
| Net loss | (70,420) | (71,725) | ||
| Net loss per basic common shareholder | (0.13) | (0.14) | ||
| Basic weighted average common shares | 524,200 | 524,200 | ||
| Financial Position Data: | ||||
| Total assets | 0 | 0 | ||
| Total liabilities | (307,271) | 236,851 | ||
| Stockholders' equity (deficiency) | (307,271) | (236,851) |
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND PLAN OF OPERATION Back to Table of Contents
The following discussion contains forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use of words such as "anticipate", "estimate", "expect", "project", "intend", "plan", "believe", and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. From time to time, we also may provide forward-looking statements in other materials we release to the public.
Overview
Our current activities are related to seeking a new business opportunities. We will
use our limited personnel and financial resources in connection with such activities. It
may be expected that pursuing a new business opportunity will involve the issuance of
restricted shares of common stock. On June 30, 20, we had no cash assets and the Company
had current liabilities of $112,271. We incurred $69,800 in general and administrative
expenses during the year 2011 compared to $68,800 during 2010. We recorded $22,780 in
other income during the fourth quarter in connection with a forgiveness of payables.
Liquidity and Capital Resources
While we are dependent upon interim funding provided by such related party or by management to pay professional fees and expenses, we have no written finance agreement with management to provide any continued funding. Through the date of this filing, a related party and/or management provided funding for our plan of operation which funds were used for general administrative expenses and accounting fees.
As part of our intent to seek new business opportunities, we may determine to seek to raise funds from the sale of equity or debt securities.We have no agreements to issue any debt or equity securities and cannot predict whether equity or debt financing will become available at terms acceptable to us, if at all.
We anticipate that in connection with the commencement of a new business opportunity or consummation of a business combination, we will issue a substantial number of additional restricted shares or other securities. If such additional securities are issued, our shareholders will experience a dilution in their ownership interest in the Company. If a substantial number of shares are issued in connection with a business combination, a change in control may be expected to occur.
There are no limitations in our articles of incorporation on our ability to borrow funds or raise funds through the issuance of restricted common stock to pursue new business opportunities. Our limited resources and lack of operating history may make it difficult to do borrow funds or raise capital. Our inability to borrow funds or raise funds through the issuance of restricted common stock required to facilitate new business opportunities may have a material adverse effect on our financial condition and future prospects. To the extent that debt financing ultimately proves to be available, any borrowing will subject us to various risks traditionally associated with indebtedness, including the risks of interest rate fluctuations and insufficiency of cash flow to pay principal and interest.
The Company has only limited capital. Additional financing is necessary for the Company to continue as a going concern. Our independent auditors have qualified our audit opinion for the year ended June 30, 2010 based on going concern.In view of these matters, realization of a major portion of the assets in the accompanying balance sheet is dependent upon continued operations of the Company. Management believes that actions presently being taken to obtain additional equity financing will provide the opportunity to continue as a going concern.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Back to Table of ContentsWe have not entered into, and do not expect to enter into, financial instruments for trading or hedging purposes.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Back to Table of Contents
| Report of Independent Registered Public Accounting Firm | 12 |
| Report of Independent Registered Public Accounting Firm | 13 |
| Financial Statements for the Years Ended June 30, 2011 and 2010 | |
| Balance Sheets | 14 |
| Statement of Operations | 15 |
| Statement of Stockholders' Equity | 16 |
| Statement of Cash Flows | 17 |
| Notes to Financial Statements | 18 |
Report of Independent Registered Public Accounting Firm
To the Board of Directors Peregrine Industries, Inc
We have audited the accompanying balance sheet of Peregrine Industries, Inc (“The Company”) as of June 30, 2011, and the related statements of operations, shareholders' deficit, and cash flows for the year ended June 30, 2011.These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal controls over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal controls over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Peregrine Industries as of June 30, 2011 and the results of its operations and their cash flows for the year ended June 30, 2011, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 7 of the financial statements, the Company incurred a loss of $70,420 and no revenues. These matters raise substantial doubt about 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.
/s/ McConnell & Jones, LLP
Houston, Texas
September 29, 2011
Houston, TX 77056
Phone: 713.968.1600
Fax: 713.968.1601
We have audited the accompanying balance sheet of Peregrine Industries, Inc. (“the Company”) as of June 30, 2010, and the related statements of operations, changes in stockholders’ equity and cash flows for the year ended June 30, 2010. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Peregrine Industries, Inc at June 30, 2010, and the related results of their operations and cash flows for the year ended June 30, 2010, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company incurred a loss of $71,725 during the year ended June 30, 2010 and, as of June 30, 2010 the Company’s current liabilities exceeded its current assets by $41,351. These facts raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to fund future operations through additional loans, but has no binding obligation to do so. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
ABBM Group Ltd LLP
Houston, Texas 77060
September 27, 2010
Peregrine Industries, Inc. |
||||
| Back to Table of Contents | ||||
| Fiscal Year Ended | Fiscal Year Ended | |||
| June 30, 2010 | June 30, 2009 | |||
ASSETS |
||||
| Current assets: | ||||
| Cash | $ | 0 | $ | 0 |
| Advances to related parties | 0 | 0 | ||
| Total current assets | 0 | 0 | ||
| Total Assets | $ | 0 | $ | 0 |
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
||||
| Current liabilities: | ||||
| Accounts payable-trade | $ | 5,946 | $ | 22,926 |
| Accrued interest expenses | 26,325 | 2,925 | ||
| Advances due to related party | 80,000 | 16,000 | ||
| Total current liabilities | 112,271 | 41,851 | ||
| Convertible notes, related parties | 195,000 | 195,000 | ||
| Stockholders' deficit: | ||||
| Preferred stock, $.0001 par value; 5,000,000 authorized, none issued | - | - | ||
| Common stock, $.0001 par value; 100,000,000 shares authorized; | ||||
| 504,200 issued and outstanding at June 30, 2011 and 2010 | 52 | 52 | ||
| Additional paid in capital | 157,832 | 157,832 | ||
| Accumulated deficit | (465,155) | (394,735) | ||
| Stockholders' deficit | (307,271) | (236,851) | ||
| Total Liabilities and Stockholders' deficit | $ | 0 | $ |
0 |
| See Summary of Significant Accounting Policies and Notes to Financial Statements. | ||||
| Peregrine Industries, Inc. | ||||
| Statement of Operations | ||||
| Back to Table of Contents | ||||
| Fiscal Year Ended | Fiscal Year Ended | |||
| June 30, 2011 | June 30, 2010 | |||
| Revenue | $ | 0 | $ | 0 |
| Costs and Expenses: | ||||
| General and administrative | 69,800 | 68,800 | ||
| Interest expenses | 23,400 | 2,925 | ||
| Total costs and expenses | 93,200 | 71,725 | ||
| Other income | 22,780 | 0 | ||
| Net loss | $ | (70,420) | $ | (71,725) |
| Per share amounts: | ||||
| Basic and diluted net loss | $ | (0.13) | $ | (0.14) |
| Weighted average shares outstanding (basic and diluted) | 524,200 | 524,200 | ||
| See accompanying notes to the financial statements. | ||||
Peregrine Industries, Inc. |
|||||||
| Back to Table of Contents | |||||||
| Common | |||||||
| Common | Additional | ||||||
| Stock | Paid-In | Accumulated |
|||||
Shares |
Amount |
Capital |
Deficit |
||||
| Balance at June 30, 2009 | 524,200 | $ |
52 |
157,832 |
(323,010) | ||
| Net loss | (71,725) | ||||||
| Balance at June 30, 2010 | 524,200 | $ |
52 |
157,832 |
(394,735) | ||
| Net loss | (70,420) | ||||||
| Balance at June 30, 2011 | 524,200 | $ | 52 | $ | 157,832 | $ | (465,155) |
| See accompanying notes to the financial statements. | |||||||
Peregrine Industries, Inc. |
||||
| Back to Table of Contents | ||||
| Fiscal Year Ended | Fiscal Year Ended | |||
| June 30, 2011 | June 30, 2010 | |||
| Cash flows from operating activities: | $ | (70,420) | $ | (71,725) |
| Net loss | ||||
| Adjustments required to reconcile net loss | ||||
| to cash used in operating activities: | ||||
| Fair value of services provided by related parties | 64,000 | 63,000 | ||
| Expenses paid by related parties | - | - | ||
| Increase (decrease) in accounts payable and accrued expenses | 6,420 | 8,725 | ||
| Cash flows used by operating activities | 0 | 0 | ||
| Cash flows from investing activities: | ||||
| Purchase of equipment | 0 | 0 | ||
| Cash used in investing activities | 0 | 0 | ||
| Cash flows from financing activities: | ||||
| Proceeds from issuance of common stock | 0 | 0 | ||
| Cash advances from related parties | 0 | 0 | ||
| Cash generated by financing activities | 0 | 0 | ||
| Change in cash | ||||
| Cash - Beginning of period | 0 | 0 | ||
| Cash - End of period | $ | 0 | $ | 0 |
| See accompanying notes to the financial statements. | ||||
PEREGRINE INDUSTRIES, INC.
Notes to the Financial Statements
June 30, 2011
Back to Table
of Contents
Note 1. The Company
Peregrine Industries, Inc. (the "Company") was formed on October 1, 1995 for the purpose of manufacturing residential pool heaters. The Company was formerly located in Deerfield Beach, Florida. Products were primarily sold throughout the United States, Canada, and Brazil. In September 1998, the Company formed a wholly-owned subsidiary, Alcool, Inc., in Montgomery, Alabama, in order to expand its manufacturing capacity and product line. Canadian operations were conducted through a wholly owned subsidiary Thermopompe Peregrine Heat Pump, a Quebec corporation. In June 2002, the Registrant and its subsidiaries filed a petition for bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida. At present, the Company has no business operations and is deemed to be a shell company.
Note 2. Basis of Presentation:
The Financial Statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America.
Accounting Policies
Use of Estimates : The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates.
Cash and Cash Equivalents : For financial statement presentation purposes, the Company considers those short-term, highly liquid investments with original maturities of three months or less to be cash or cash equivalents.
Stock Based Compensation: Stock-based awards to non-employees are accounted for using the fair value method in accordance with Accounting Standard Codification (“ASC”) 505-50, Accounting for Stock-Based Compensation , . All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the third-party performance is complete or the date on which it is probable that performance will occur.
We adopted ASC #505-50 using the “modified prospective” method, which results in no restatement of prior period amounts. Under this method, the provisions of ASC #505-50 apply to all awards granted or modified after the date of adoption. In addition, compensation expense must be recognized for any unvested stock option awards outstanding as of the date of adoption on a straight-line basis over the remaining vesting period. We calculate the fair value of options using a Black-Scholes option pricing model. We do not currently have any outstanding options therefore no charge is required for the year ended June 30, 2011. ASC #505-50 also requires the benefits of tax deductions in excess of recognized compensation expense to be reported in the Statement of Cash Flows as a financing cash inflow rather than an operating cash inflow. In addition, ASC #505-50 required a modification to the Company’s calculation of the dilutive effect of stock option awards on earnings per share. For companies that adopt ASC 505-50 using the “modified prospective” method, disclosure of pro forma information for periods prior to adoption must continue to be made.
Fair Value of Financial Instruments : ASC # 825, "Disclosures about Fair Value of Financial Instruments," requires disclosure of fair value information about financial instruments. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2011.These financial instruments include, accounts payable, and accrued expenses,. Fair values were assumed to approximate carrying values for these financial instruments since they are short-term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand.
Earnings per Common Share : Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed using the weighted average number of common and dilutive equivalent shares outstanding during the period. Dilutive common equivalent shares consist of options to purchase common stock (only if those options are exercisable and at prices below the average share price for the period) and shares issueable upon the conversion of our Preferred Stock. Due to the net losses reported, dilutive common equivalent shares were excluded from the computation of diluted loss per share, as inclusion would be anti-dilutive for the periods presented. There were no common equivalent shares required to be added to the basic weighted average shares outstanding to arrive at diluted weighted average shares outstanding in 2011 or 2010.
Income Taxes: The Company accounts for income taxes in accordance with ASC # 740, "Accounting for Income Taxes," which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income tax is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized.
In 2006, the FASB issued FIN 48, which clarifies the accounting for uncertainty in tax positions. FIN 48 requires that the Company recognize in its financial statements the impact of a tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The Company adopted the provisions of FIN 48 on July 1, 2007.
Management of the Company is not aware of any additional needed liability for unrecognized tax benefits at June 30, 2011 and June 30, 2010.
Recent Accounting Pronouncements
In June 2011, the FASB issued Accounting Standards Update (“ASU”) 2011-05, Presentation of Comprehensive Income. This ASU is intended to increase the prominence of other comprehensive income in financial statements by presenting the components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate, but consecutive statements. The new guidance eliminates the current option to report other comprehensive income and its components in the statement of changes in stockholders’ equity. This new guidance is effective for fiscal years and interim periods beginning after December 15, 2011. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance; therefore, adoption of the new guidance in the first quarter of fiscal 2012 will not have any impact on the Company’s consolidated financial position, results of operations or cash flows.
In May 2011, the FASB issued ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (“IFRSs”), which amends ASC 820, Fair Value Measurement. ASU 2011-04 does not extend the use of fair value accounting, but provides guidance on how it should be applied where its use is already required or permitted by other standards within U.S. GAAP or IFRSs. ASU 2011-14 changes the wording used to describe many requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. Additionally, ASU 2011-14 clarifies the FASB’s intent about the application of existing fair value measurements. ASU 2011-04 is effective for interim and annual periods beginning after December 15, 2011 and is applied prospectively; therefore, the Company will adopt ASU 2011-04 in its first quarter of fiscal 2012. The Company does not expect the adoption of ASU 2011-04 to have a material impact on its consolidated financial statements.
Note 3. Stockholders' Equity:
Common Stock
The articles of incorporation authorize the issuance of 100,000,000 shares of common stock, par value $0.0001. All issued shares of common stock are entitled to one vote per share of common stock.
Preferred Stock
The articles of incorporation authorize the issuance of 5,000,000 shares of preferred stock with a par value of $.0001 per share. None are issued
Stock Based Compensation
There were no grants of employee or non-employee stock or options in either fiscal period ended June 30, 2011 or 2010.
Note 4. Convertible Note to Related Party:
In April 2010, we issued one convertible promissory note in the amount of $97,500 to our President and one convertible promissory note in the amount of $97,500 to a director. The note bear interests at 12% per annum until paid or converted. Interest is payable upon the maturity date (December 31, 2011). The initial conversion rate is $0.10 per share (subject to standard anti-dilution provisions). The note formalized a like amount due through the accretion of cash advances and the fair value of services provided without cost covering several years.
The convertible debt securities were issued with a non-detachable conversion feature. We evaluate and account for such securities in accordance with Accounting Standard Codification ( “ASC) # 815, Accounting for Derivative Instruments and Hedging Activities.
In accordance ASC #815, we evaluate that the holder’s conversion right provision, interest rate adjustment provision, liquidated damages clause, cash premium option (if applicable), and the redemption option (collectively, the debt features) contained in the terms governing the Note to determine whether they are or are not clearly and closely related to the characteristics of the Note. Accordingly, if the features qualify as embedded derivative instruments at issuance and, furthermore if they do or do not qualify for any scope exception within ASC #815 , then they are required by ASC #815 to be accounted for separately from the debt instrument and recorded as derivative financial instruments.
The values ascribed to the note, the conversion feature of the note, other potential embedded derivative features, and common stock follow the guidance of ASC #815. The Company considered the embedded conversion feature and its effect based on ASc #815. In accordance with ASC# 815, a transaction which includes a potential for net-cash settlement, including liquidated damages, requires that derivative financial instruments, including warrants and the embedded conversion feature, be bifurcated, and initially recorded at fair value as an asset or liability and subsequent changes in fair value be reflected in the statement of operations.
Note 5. Related Party Transactions:
Fair value of services:
The executive officer provides services to the Company, which services are accrued and are valued at $2,000 in month. The total of these accrued expenses was $24,000 for the year 2011 and is reflected in the statement of operations as general and administrative expenses.
The Company’s non-executive director who was appointed to the board of directors on December 7, 2009, is entitled to receive compensation of $1,000 per quarter for a total of $4,000 and $2,000 during year ended June 30, 2011 and 2010, respectively.
An entity affiliated by common management to the Company provided securities compliance services related to SEC filing services valued at $24,000 during 2011 and $24,000 during 2010. This amount was also reflected in the statement of operations as general and administrative expenses.
Due Related Parties:
Amounts due related parties consist of:
- Expenses incurred in meeting ongoing disclosure and reporting requirements are
accrued and payable to the principal shareholders and officers
- the fair value of services of management provided to the Company
- and the fair value of services provided by an entity affiliated by common management
Such items due totaled $275,000 at June 30, 2011 and $211,000 at June 30, 2010.
Note 6. Going Concern
The Company's financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business for the foreseeable future. Since adopting "fresh-start" accounting as of September 5, 2002, the Company has accumulated losses aggregating to $465,155 and has insufficient working capital to meet operating needs for the next twelve months as of June 30, 2011, all of which raise substantial doubt about the Company's ability to continue as a going concern.
Note 7. Subsequent Events
On July 27, 2011, the Company’s board of directors agreed to extend the maturity of the two convertible notes to December 31, 2012
.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Back to Table of Contents
On September 28, 2011, the Company file a Form 8-K/A disclosing that on September 20, 2011, ABBM Group, Ltd LLP (ABBM) notified the Company that effective as of that date, the firm resigned as auditor. Effective the same date, the Company appointed McConnell & Jones, LLP as its new auditor and that decision to change the auditor was approved by the Company's Board of Directors on September 20, 2011.
ITEM 9A. CONTROLS AND PROCEDURES Back to Table of Contents
Evaluation of Disclosure Controls and Procedures
As of June 30, 20
11, the Company's chief executive officer/chief financial officer conducted an evaluation regarding the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the evaluation of these controls and procedures, our chief executive officer/chief financial officer concluded that our disclosure controls and procedures were effective as of the end of the fiscal year ended June 30, 2011.Management’s Annual Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of those internal controls. As defined by the SEC, internal control over financial reporting is a process designed by our principal executive officer/principal financial officer, who is also the sole member of our Board of Directors, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements in accordance with U.S. generally accepted accounting principles.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management has assessed the effectiveness of our internal control over financial reporting as of June 30, 2010. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework. Based on our assessment and those criteria, we have concluded that our internal control over financial reporting was effective as of June 30, 2010.
This annual report does not include an attestation report of the company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only Management’s report in this annual report.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting or in other factors identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the fourth quarter ended June 30, 2011 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Back to Table of ContentsNone.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT, AND CORPORATE GOVERNANCE Back to Table of Contents
The following table sets forth the names and ages of the members of our Board of Directors and our executive officers and the positions held by each.
| Name | Age |
Title | ||
| Richard Rubin | 68 |
CEO, CFO and Chairman | ||
| Ivo Heiden | 44 |
Director |
Richard Rubin, 65, CEO, CFO and chairman of the Registrant, has been an officer and a director of the Registrant since March 30, 2004. During the last five years, Mr. Rubin has been engaged in the business of providing corporate securities consulting services and reorganizing distressed public companies. In February 2002, Mr. Rubin also became an secretary and a director of Nettel Holdings, a reporting company and resigned as secretary and director in May 2003. Mr. Rubin served as a director of Jeantex Group, a reporting company from August 2002 to September 2003.
Ivo Heiden, 43, Director of the Registrant, has been a director of the Registrant since December 2009. During the last five years, Mr. Heiden has been engaged in the business of providing corporate securities compliance service and reorganizing distressed public companies. Mr. Heiden was CEO and Chairman of St. Lawrence Energy Corp., a public reporting company, from January 2005 until December 2007. Mr. Heiden is CEO, CFO and Chairman of Zaxis International, Inc., a public reporting company trading on the FINRA BB.
Our directors holds office until the next annual meeting of stockholders and until their successors have been duly elected and qualified. Officers are appointed by the Board of Directors and each executive officer serves at the discretion of the Board of Directors. We do not have any standing committees at this time. Our director, officer, affiliates or promoters has not, within the past five years, filed any bankruptcy petition, been convicted in or been the subject of any pending criminal proceedings, or is any such person the subject or any order, judgment or decree involving the violation of any state or federal securities laws.
Code of Ethics
The Corporation has adopted a Code of Ethics that are designed to deter wrongdoing and to
promote honest and ethical conduct, full, fair, accurate, timely and understandable
disclosure in the Registrant's SEC reports and other public communications. The Code of
Ethics promotes compliance with applicable governmental laws, rules and regulations.
Section 16(a) Compliance
Section 16(a) of the Securities and Exchange Act of 1934 requires the Registrant's
directors and executive officers, and persons who own beneficially more than ten percent
(10%) of the Registrant's Common Stock, to file reports of ownership and changes of
ownership with the Securities and Exchange Commission. Copies of all filed reports are
required to be furnished to the Registrant pursuant to Section 16(a). Based solely on the
reports received by the Registrant and on written representations from reporting persons,
the Registrant was informed that its officer and director has filed all reports required
under Section 16(a).
ITEM 11. EXECUTIVE COMPENSATION Back to Table of Contents
The following table sets forth information concerning the total compensation that we have paid or that has accrued on behalf of our chief executive officer and other executive officers with annual compensation exceeding $100,000 during the fiscal years ending June 30, 2010, 2009 and 2008.
Long-Term Compensation |
||||||||
Annual Compensation |
Awards |
Payouts |
||||||
Name and Principal Position |
Year |
Salary ($) |
Bonus ($) |
Other Annual Compensation ($) |
Restricted Stock Award(s) ($) |
Securities Under-lying Options/ SARs (#) |
LTIP Payouts ($) |
All other Compensation ($) |
| Richard Rubin (1) | 2011 |
24,000 | -0- | -0- | -0- | -0- | -0- | -0- |
2010 |
24,000 | -0- | -0- | -0- | -0- | -0- | -0- | |
2009 |
24,000 | -0- | -0- | -0- | -0- | -0- | -0- | |
| (1) The Registrant's CEO receives annual compensation of $24,000, which compensation has been accrued. | ||||||||
Executive Employment Agreements
To date, we have not entered into any employment agreements with our executive officer.
TEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Back to Table of Contents
The following table sets forth information regarding the beneficial ownership of our common stock as of June 30, 2011. The information in this table provides the ownership information for: each person known by us to be the beneficial owner of more than 5% of our common stock; each of our directors; each of our executive officers; and our executive officers and directors as a group. Beneficial ownership has been determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to the shares. Unless otherwise indicated, the persons named in the table below have sole voting and investment power with respect to the number of shares indicated as beneficially owned by them.
| Name of Beneficial Owner | Common Stock Beneficially Owned (1) | Percentage of Common Stock Owned (1) | ||
| Richard Rubin, CEO and Chairman | 110,000 | 20.98% | ||
| 40 Wall Street, 28th Floor | ||||
| New York, NY 10005 | ||||
| Thomas J. Craft, Jr. | 110,000 | 20.98% | ||
| 5420 North Ocean Drive, Suite 1605 | ||||
| Singer Island, FL 33404 | ||||
| Ivo Heiden, Director | 104,000 | 19.84% | ||
| 6399 Wilshire Blvd., Suite 1019 | ||||
| Los Angeles, CA 90048 | ||||
| Park Avenue Group, Inc. | 57,000 | 10.87% | ||
| 40 Wall Street, 28th Floor | ||||
| New York, NY 10005 | ||||
| Merrill Yarbrough | 87,316 | 16.65% | ||
| 2905 Via Napoli | ||||
| Deerfield Beach, FL 33442 | ||||
| All Directors and Executive Officers as a Group (2 persons) | 214,000 | 40.82% |
(1) Applicable percentage ownership is based on 524,200 shares of common stock outstanding as of June 30, 2011.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Back to Table of Contents
During the last two fiscal years, to the knowledge of the Registrant, there was no person who had or has a direct or indirect material interest in any transaction or proposed transaction to which the Registrant was or is a party. Transactions in this context relate to any transaction which exceeds $120,000.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES Back to Table of Contents
The Registrant's Board of Directors has appointed McConnell & Jones, LLP as independent public accountant for the fiscal year ended June 30, 2011 and the financial statements for the year ended June 30, 2010 were audited by ABBM Group, Ltd LLP.
Principal
Accounting Fees
The following table presents the fees for professional audit services rendered by
McConnell & Jones, LLP and ABBM Group, Ltd LLP for the audit of the Registrant's
annual financial statements for the years ended June 30, 2011 and 2010, and fees billed
for other services rendered by McConnell & Jones, LLP and ABBM Group Ltd LLP during
those periods.
Year Ended |
||||||||
| June 30, 2011 | June 30, 2010 | |||||||
Audit fees (1) |
$ | 4,000 | $ | 4,000 | ||||
Audit-related fees (2) |
- | - | ||||||
All other fees |
- | - | ||||||
| (1) Audit fees consist of audit and review services, consents and review of documents filed with the SEC. | ||||||||
| (2) Audit-related fees consist of assistance and discussion concerning financial accounting and reporting standards and other accounting issues. | ||||||||
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULE Back to Table of Contents
(a) The following documents are filed as exhibits to this report on Form 10-K or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.
Exhibit No. |
Description |
|---|---|
| 31.1 | Certification of CEO and CFO pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| 32.1 | Certification of CEO and CFO pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.
/s/ RICHARD
RUBIN
Chief Executive Officer, CFO and Chairman
Dated: October 3, 2011