Attached files
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2009
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to __________
Commission File No. 0-18344
SOONER HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
State of Incorporation: Oklahoma
IRS Employer I.D. Number: 73-1275261
127 Northwest 62nd Street, Suite A
Oklahoma City, OK 73118
(405) 848-7575
----------------------------------------------------
(Address and telephone number of registrant's principal
executive offices and principal place of business)
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 twelve 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 by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act. Yes [X] No [ ]
As of February 8, 2010, there were 12,688,016 shares of the Registrant's
Common Stock, $0.001 par value, outstanding.
TABLE OF CONTENTS
Page
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PART I - FINANCIAL INFORMATION 3
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
Item 4. Controls and Procedures 12
PART II - Other Information 12
Item 1. Legal Proceedings 12
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 12
Item 6. Exhibits 12
SIGNATURES 13
2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Page
----
Balance Sheet September 30, 2009 (Audited) and
December 31, 2009 (Unaudited) 4
Statements of Operations for the Three Months
Ending December 31, 2009 and 2008 (Unaudited) 5
Statements of Cash Flows for the Three Months Ending
December 31, 2009 and 2008 (Unaudited) 6
Notes to Financial Statements (Unaudited) 7
Our unaudited interim financial statements, including balance sheet as of
December 31, 2009, statement of operations for the three month periods ended
December 31, 2009 and 2008, and statement of cash flows for the three month
periods ended December 31, 2009 and 2008 are attached hereto as pages 4 through
6 and are incorporated herein by this reference. Our audited balance sheet as of
September 30, 2009 included on page 4 is also incorporated by reference.
The interim financial statements included herein have been prepared internally,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission and the Public Company Accounting Oversight Board. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
omitted. However, in our opinion, all adjustments (which include only normal
recurring accruals) necessary to fairly present the financial position and
results of operations have been made for the periods presented.
The financial statements included herein should be read in conjunction with the
financial statements and notes thereto included in our annual report on Form
10-K for the year ended September 30, 2009.
3
SOONER HOLDINGS, INC.
BALANCE SHEETS
September 30, December 31,
ASSETS 2009 2009
----------- -----------
(Unaudited)
Current Assets
Cash and cash equivalents $ 7,536 $ 8,186
----------- -----------
Total Current Assets 7,536 8,186
----------- -----------
Total Assets $ 7,536 $ 8,186
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable $ 43,172 $ 53,676
Loans from shareholder 90,367 93,367
----------- -----------
Total Current Liabilities 133,539 147,043
Stockholders' Equity (Deficit)
Preferred stock - undesignated; authorized, 10,000,000 shares; issued
and outstanding, none
Common stock, $.001 par value 100,000,000 shares authorized
12,688,016 shares issued and outstanding 12,688 12,688
Additional paid in capital 6,197,690 6,197,690
Retained earnings (deficit) (6,336,381) (6,349,235)
----------- -----------
Total Stockholders' Equity (Deficit) (126,003) (138,857)
----------- -----------
Total Liabilities and Stockholders' Equity (Deficit) $ 7,536 $ 8,186
=========== ===========
See accompanying notes to financial statements.
4
SOONER HOLDINGS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
December 31,
----------------------------
2008 2009
------------ ------------
Revenue $ -- $ --
Operating Expenses
General and administrative expense 2,951 11,044
------------ ------------
Total Operating Expenses 2,951 11,044
------------ ------------
Operating Loss (2,951) (11,044)
Other (Expenses) Income
Interest expense (1,251) (1,810)
------------ ------------
Total Other (Expense) Income (1,251) (1,810)
------------ ------------
Net Loss $ (4,202) $ (12,854)
============ ============
Net Loss per Share, Basic and Diluted (0.00) (0.00)
============ ============
Weighted average of number of shares outstanding 12,688,016 12,688,016
============ ============
See accompanying notes to financial statements.
5
SOONER HOLDINGS, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ending
December 31,
-----------------------
2008 2009
-------- --------
Cash Flows From Operating Activities
Net loss $ (4,202) $(12,854)
Adjustments to reconcile net loss to net cash provided by
operating activities
Increase (decrease) in
Accounts payable 743 10,504
-------- --------
Net Cash Flows Used In Operating Activities (3,459) (2,350)
Cash Flows from Financing Activities
Loans from shareholder 3,400 3,000
-------- --------
Net Cash Provided by Financing Activities 3,400 3,000
Increase (Decrease) in Cash (59) 650
Cash at Beginning of Year 269 7,536
-------- --------
Cash at End of Year $ 210 $ 8,186
======== ========
See accompanying notes to financial statements.
6
SOONER HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
NOTE A - ORGANIZATION AND OPERATIONS
Sooner Holdings, Inc. ("Sooner" or the "Company"), an Oklahoma corporation,
formerly conducted business through three of its wholly owned subsidiaries.
Charlie O Business Park Incorporated ("Business Park") which was liquidated into
Sooner on October 1, 2005 was engaged in the ownership and rental of a business
park in Oklahoma City, Oklahoma. ND Acquisition Corp. ("NDAC") which was sold on
September 30, 2005 operated minimum security correctional facilities. Sooner
Communications, Inc. ("Telecommunications") was liquidated into Sooner Holdings
on October 1, 2005. It was engaged in providing enhanced services to the
telecommunications industry. Currently, Sooner is inactive except for the
administrative costs associated with being a publicly traded entity. Management
is seeking new business opportunities.
NOTE B - CONTINUATION AS A GOING CONCERN
The accompanying financial statements have been prepared assuming that Sooner
Holdings, Inc. will continue as a going concern. Sooner Holdings, Inc. has
suffered losses from operations in recent years and continues to have a
significant shareholders' deficit. Subsequent to September 30, 2004, and as of
the date of this report, Sooner Holdings, Inc., has ceased all of the operations
described in Note A to the financial statements and is currently seeking to
acquire new business opportunities. As of December 31, 2009, the Company had a
deficit net worth of $(138,857) and no operating activities.
The Company's current business plan is to seek, investigate and, if warranted,
acquire one or more properties or businesses, and to pursue other related
activities intended to enhance shareholder value. The acquisition of a business
opportunity may be made by purchase, merger, exchange of stock, or otherwise,
and may encompass assets or a business entity, such as a corporation, joint
venture or partnership. Management intends to seek opportunities demonstrating
the potential of long-term growth as opposed to short-term earnings. Management
cannot predict to what extent the Company might incur further operating losses
through any business entity which may eventually be acquired. The financial
statements do not include any adjustment relating to the classification of
liabilities that might result should the Company be unable to continue as a
going concern.
NOTE C - SUMMARY OF ACCOUNTING POLICIES
A summary of the significant accounting policies consistently applied in the
preparation of the accompanying consolidated financial statements follows.
Cash and Cash Equivalents
-------------------------
The Company considers money market accounts and all highly liquid debt
instruments purchased with a maturity of three months or less to be cash
equivalents.
7
SOONER HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
Income Taxes
------------
The Company provides for deferred income taxes on carryforwards and
temporary differences between the bases of assets and liabilities for
financial statement and tax reporting purposes. Additionally, the Company
provides a valuation allowance on deferred tax assets if, based on the
weight of available evidence, it is more likely than not that some
portion or all of the deferred tax assets will not be realized.
Loss Per Common Share
---------------------
Basic loss per share has been computed on the basis of weighted average
common shares outstanding during each period. Diluted loss per share is
the same as basic loss per share as the Company has no outstanding
dilutive potential common shares.
Use of Estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures;
accordingly, actual results could differ from those estimates.
Concentrations of Credit Risk
-----------------------------
The Company in the past maintained cash balances at several financial
institutions. On December 31, 2009, the company had only one checking
account at one financial institution. Accounts at each institution in
non-interest bearing accounts are insured by the Federal Deposit Insurance
Corporation. The company's only checking account is non-interest bearing
and is fully insured with no limitations on account balances. The Federal
Deposit Insurance Corporation will provide the full coverage with no
limits until December 31, 2009.
NOTE D - STOCKHOLDERS' EQUITY (DEFICIT)
Preferred Stock
---------------
The Company's authorized capital includes 10,000,000 shares of preferred stock,
undesignated as to par value. The Board of Directors of the Company, in its sole
discretion, may establish par value, divide the shares of preferred stock into
series and fix and determine the dividend rate, designations, preferences,
privileges and ratify the powers, if any, and determine the restrictions and
qualifications of each series of preferred stock as established. No shares of
preferred stock have been issued by the Company as of December 31, 2009.
Employee Stock Option Plan
--------------------------
The Company has a stock option plan ("1995 Plan") for directors, officers, key
employees, and consultants covering 2,000,000 shares of Company common stock.
Options granted under the 1995 Plan may be either "incentive stock options", as
defined in Section 422A of the Internal Revenue Code, or "nonqualified stock
options", subject to Section 83 of the Internal Revenue Code, at the discretion
of the Board of Directors and as reflected in the terms of the written option
8
SOONER HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
agreement. The option price shall not be less than 100% (110% if the option is
granted to a stockholder who at the time the option is granted owns stock
representing more than 10% of the total combined voting power of all classes of
stock of the Company) of the fair market value of the optioned common stock on
the date the options are granted. Options become exercisable based on the
discretion of the Board of Directors but must be exercised within ten years of
the date of grant. On December 31, 2009 there were no options outstanding under
the plan.
NOTE E - INCOME TAXES
A valuation allowance for deferred tax assets is required when it is more likely
than not that some portion or all of the deferred tax assets will not be
realized. The ultimate realization of this deferred tax asset depends on the
Company's ability to generate sufficient taxable income in the future.
Management believes it is more likely than not that the deferred tax asset will
not be realized by future operating results. The only deferred income tax asset
the company had at December 31, 2009 was the tax effect of the net operating
loss carryforward of approximately $695,000, which was subject to a 100%
valuation allowance at December 31, 2009.
At September 30, 2009, the Company has net operating loss carryforwards for
Expiration Loss
Date Carryforwards
9/30/2010 $357,632
9/30/2012 29,124
9/30/2018 279,949
9/30/2020 152,499
9/30/2021 173,815
9/30/2022 121,352
9/30/2023 25,044
9/30/2024 287,561
9/30/2025 206,563
9/30/2027 83,226
9/30/2028 37,185
9/30/2029 28,158
--------------
$1,782,108
==============
NOTE F - RELATED PARTY TRANSACTIONS
Related Party Obligations
-------------------------
As of December 31, 2009, the company had loans outstanding from shareholders of
$93,367. These loans are unsecured and are due on demand with an annual interest
rate of 8%. As of December 31, 2009, interest expense of $1,810 had been accrued
on these notes and is included in accounts payable.
9
SOONER HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
NOTE G - COMMITMENTS AND CONTINGENCIES
The Company is not aware of any administrative proceedings, commitments or
contingencies involving Sooner Holdings, Inc.
NOTE H - SUBSEQUENT EVENTS
Management has evaluated subsequent events through February 9, 2010, the date
which the financial statements were issued. Through this date, Management
believes that there have not been any events that materially affect the
financial statements for the quarter ended December 31, 2009.
10
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis should be read in conjunction with
the financial statements and the accompanying notes thereto and is qualified in
its entirety by the foregoing and by more detailed financial information
appearing elsewhere. See "Financial Statements."
Plan of Operation for the Next Twelve Months
Our current business plan is to seek, investigate and, if warranted,
acquire one or more properties or businesses, and to pursue other related
activities intended to enhance shareholder value. The acquisition of a business
opportunity may be made by purchase, merger, exchange of stock, or otherwise,
and may encompass assets or a business entity such as a corporation, joint
venture or partnership. We intend to seek opportunities demonstrating the
potential of long-term growth as opposed to short-term earnings.
As reported in our Form 10-K FYE 09-30-08 and as filed with the Commission
on a Form 8-K on July 28, 2008, we had signed a change of control contract with
Mr. Glen McKay of Toronto, Canada which, if the agreement had closed, would have
resulted in the company's pursuit of a business plan involving the purchase of
the monorail system in Las Vegas, Nevada, building of a high-speed railroad
between the monorail and an area near Los Angeles, California, and the
development of real estate opportunities in the adjacent areas.
The contract with Mr. McKay expired by its own terms without the change of
control having occurred.
We now have an oral agreement with Mr. Georges EmmerSon Caza, of Beijing,
China, regarding his obtaining control of our company. Mr. Caza proposes to
acquire several Chinese companies as subsidiaries of our company. The specifics
of his proposal are not yet determined. Until we enter into a formal agreement
with Mr. Caza, we propose to carry out our plan of business as first discussed
above. We cannot predict to what extent we might incur further operating losses
through any business entity, which we may eventually acquire.
For the next fiscal year, we anticipate incurring a loss as a result of
legal and accounting expenses, filing periodic reports with the Securities and
Exchange Commission, and expenses associated with locating and evaluating
acquisition candidates. We anticipate that until a business combination is
completed with an acquisition candidate, it will not generate revenues other
than interest income, and may continue to operate at a loss after completing a
business combination, depending upon the performance of the acquired business.
11
Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures. The Company carried out
an evaluation, under the supervision and with the participation of the Company's
management, including the Company's Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures as defined by Regulation 240.15d-15e. Based
upon that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the Company's disclosure controls and procedures are effective.
There were no significant changes in the Company's internal control over
financial reporting during the period covered by this report that have
materially affected, or are reasonably likely to materially affect our internal
controls over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
We are not, and none of our property is, a party to any pending legal
proceedings, and no such proceedings are known to be contemplated.
No director, officer or affiliate of the company, and no owner of record or
beneficial owner of more than 5.0% of the securities of the company, or any
associate of any such director, officer or security holder is a party adverse to
the company or has a material interest adverse to the Company in reference to
any litigation.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
There were no equity securities of the issuer sold during the period of
this report that were not registered under the Securities Act.
Item 6. Exhibits
The following exhibits are filed, by incorporation by reference, as part of
this Form 10-Q:
Page no.
Item No. Description (footnote)
-------- ----------- ----------
3.1 thru 3.3 Articles of Incorporation, By-Laws and (1)
Amendments thereto
10 Agreement for Change of Control of (4)
Sooner Holdings, Inc. executed on July
23, 2008 and recited to be effective on
July 17, 2008
14 Code of Ethics for CEO and Senior (2)
Financial Officers
12
16 Letter of November 13, 2008 of Murrell, (3)
Hall, McIntosh & Co., PLLP of Oklahoma
City, Oklahoma, the principal
independent registered public
accountants of agreeing with the
statements made in this Form 8-K by
Sooner Holdings, Inc. concerning
Sooner's change of principal independent
accountants.
20.1 Audit Committee Charter (2)
20.2 Compensation Committee Charter (2)
20.3 Governance and Nominating Committee Charter (2)
20.4 Corporate Governance Principles (2)
31.1 Certification of Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
31.2 Certification of Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
32.1 Certification of Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
32.2 Certification of Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
Footnotes:
----------
(1) Incorporated by reference to our Form 10-KSB for the year ended December
31, 1995 (file no. 0-18344).
(2) Filed as an Exhibit to our Form 10-QSB 12-31-02 (file no. 0-18344).
(3) Previously filed by Sooner Holdings, Inc. on November 18, 2008, Commission
File No. 000-18344; incorporated herein by reference.
(4) Previously filed by Sooner Holdings, Inc. on July 28, 2008, Commission File
No. 000-18344; incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: February 9, 2010
SOONER HOLDINGS, INC.
/s/ R.C. Cunningham II
By
-------------------------
R.C. Cunningham II
Chief Executive Officer
13
