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EX-32 - CERTIFICATION - APEX RESOURCES GROUP INCex32.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549


FORM 10-Q


[  ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934


For the Quarterly Period Ended December 31, 2007


OR


[ X  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  

For the transition period from _____________ to   _____________


Commission file number:      000-11695


APEX RESOURCES GROUP, INC.


(Exact name of registrant as specified in its charter)


UTAH

 

87-0403828

(State or other jurisdiction of incorporation)

 

(IRS Employer Identification No.)


1909 Monroe Avenue, Butte, MT

 

59701

(Address of principal executive offices)

 

(Zip Code)


406-723-5647

(Issuer's telephone number, including area code)


Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 at least the past 90 days.  Yes    [X]     No   [   ]     


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes    [  ]     No [X]


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange:


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 by Rule 12b-2 of the Exchange Act.)  

Yes    [   ]     No [X]


Indicate the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:   At June 17, 2011, 175,681,870 shares of the Company’s common stock were outstanding.




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PART I


ITEM 1.  FINANCIAL INFORMATION




 

 

 

 

 

 

 

 

 

 

APEX RESOURCES GROUP, INC.

 (A Development Stage Company)

 Balance Sheets  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

December 31,

 

June 30,

 

 

 

 

 

 

 

2007

 

2007

 ASSETS

 CURRENT ASSETS  

 

 

 

 

 

 

 

 

 Cash

 

 

 

$

12,033

$

33,048

 

 Accounts receivable

 

 

 

 

36,750

 

-

 

 Accounts receivable - related party

 

 

 

 

8,999

 

-

 

 

 Total Current Assets

 

 

 

 

57,782

 

33,048

 

 

 

 

 

 

 

 

 

 

 PROPERTY AND EQUIPMENT - Net of accumulated depreciation  

 

 

 

 

 

 of  $ 46,857

 

 

 

 

-

 

99,023

 

 

 

 

 

 

 

 

 

 

 OTHER ASSETS

 

 

 

 

 

 

 

 

 Oil Leases

 

 

 

 

67,913

 

67,913

 

 Investment in securities available for sale

 

 

 

 

334,400

 

111,467

 

 Land

 

 

 

 

-

 

34,352

 

 

 Total Assets

 

 

 

$

460,095

$

345,803

 

 

 

 

 

 

 

 

 

 

 LIABILITIES AND STOCKHOLDERS’ EQUITY

 CURRENT LIABILITIES:

 

 

 

 

 

 

 

 Accounts payable  

 

 

 

$

77,172

$

59,199

 

 Note payable - related party

 

 

 

 

51,306

 

60,000

 

 

 Total Current Liabilities

 

 

 

 

128,478

 

119,199

 

 

 

 

 

 

 

 

 

 

 STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 Common stock, $.001 par value, 400,000,000 shares authorized  

 

 

 

 

 

 

 120,681,780 shares issued and outstanding,  

 

 

 

 

120,682

 

120,682

 

 Additional paid-in capital

 

 

 

 

9,698,592

 

9,505,281

 

 Stock subscriptions receivable

 

 

 

 

-

 

(54,209)

 

 Accumulated other comprehensive income

 

 

 

 

273,049

 

50,116

 Deficit accumulated during the development stage

 

 

 

 

(9,760,706)

 

(9,395,266)

 

 

 Total Stockholders’ Equity

 

 

 

 

331,617

 

226,604

 

 

 

 

 

 

 

 

 

 

 

 

 Total Liabilities and Stockholders' Equity

 

 

 

$

460,095

$

345,803

 

 

 

 

 

 

 

 

 

 





The accompanying notes are an integral part of these financial statements.




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APEX RESOURCES GROUP, INC.

 (A Development Stage Company)

 Statements of Expenses

 (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

From Inception

 

 

 Three Months Ended

 

 Six Months Ended

 

(Jan 27, 1984)

 

 

 December 31,

 

 December 31,

 

Through

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

2007

 

2006

 

2007

 

2006

 

2007

REVENUES

$

-

$

-

$

-

$

650

$

369,232

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 Exploration, development, and  

 

 

 

 

 

 

 

 

 

 

   administrative

 

34,885

 

122,833

 

113,482

 

194,146

 

11,166,137

 Stock based compensation

 

-

 

-

 

247,520

 

-

 

247,520

 Depreciation

 

-

 

5,328

 

-

 

10,656

 

194,262

             Total operating expenses

 

34,885

 

128,161

 

361,002

 

204,802

 

11,607,919

 

 

 

 

 

 

 

 

 

 

 

OPERATING LOSS

 

(34,885)

 

(128,161)

 

(361,002)

 

(204,152)

 

(11,238,687)

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (LOSS)

 

 

 

 

 

 

 

 

 

 

 Gain on sale of assets

 

-

 

91,608

 

94,585

 

141,636

 

1,606,530

 Loss on land foreclosure

 

-

 

-

 

-

 

-

 

(1,744)

 Loss on disposal of office equipment

(99,023)

 

-

 

(99,023)

 

-

 

(99,023)

 Interest expense

 

-

 

(760)

 

-

 

(1,332)

 

(27,782)

 

 

 

 

 

 

 

 

 

 

 

 NET LOSS

 

(133,908)

 

(37,313)

 

(365,440)

 

(63,848)

 

(9,760,706)

 

 

 

 

 

 

 

 

 

 

 

 OTHER COMPREHENSIVE GAIN  

 

 

 

 

 

 

 

 

 

 Unrealized gain in investments

 

 

 

 

 

 

 

 

 

 

    available for sale

 

222,933

 

-

 

222,933

 

-

 

273,049

 

 

 

 

 

 

 

 

 

 

 

 COMPREHENSIVE GAIN (LOSS)

$

89,025

$

(37,313)

$

(142,507)

$

(63,848)

$

(9,487,657)

 

 

 

 

 

 

 

 

 

 

 

 Weighted average number of shares

120,681,870

 

104,844,195

 

120,681,870

 

104,844,195

 

 

 Basic and diluted net gain (loss)  

 

 

 

 

 

 

 

 

 

 

   per share

$

-

$

-

$

-

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 



The accompanying notes are an integral part of these financial statements.





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APEX RESOURCES GROUP, INC.

 

 (A Development Stage Company)

 

 Statements of Cash Flows  

 

 (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 From Inception

 

 

 

 

 

 

 

 

 

 

 

 (Jan 27, 1984)

 

 

 

 

 

 

 

 Six Months Ended

 

 Through  

 

 

 

 

 

 

 

December 31,

 

 December 31,

 

 

 

 

 

 

 

2007

 

2006

 

2007

 

 Cash Flows From Operating Activities

 

 

 

 

 

 

 

 

 

 Net Loss

 

$

(365,440)

$

(63,848)

$

(9,760,706)

 

 

 Adjustments to reconcile net loss to net cash

 

 

 

 

 

 

 

 

 

 

 used in operating activities:

 

 

 

 

 

 

 

 

 

 

 Depreciation

 

 

-

 

10,656

 

170,546

 

 

 

 Gain on sale of assets

 

 

(99,457)

 

(141,636)

 

(1,611,402)

 

 

 

 Loss on disposal of office equipment

 

 

99,023

 

-

 

99,023

 

 

 

 Common stock issued for services and expenses

 

 

-

 

-

 

5,322,092

 

 

 

 Stock based compensation

 

 

247,520

 

-

 

247,520

 

 

 Changes in operating assets and liabilities:

 

 

 

 

 

 

-

 

 

 

 Increase in accounts receivable

 

 

(36,750)

 

3,331

 

(95,673)

 

 

 

 Increase in accounts receivable - related party

 

 

(8,999)

 

-

 

(8,999)

 

 

 

 Increase in accounts payable

 

 

17,973

 

(5,761)

 

838,720

 

 

 

 Decrease in notes payable - related party

 

 

(8,694)

 

-

 

(8,694)

 

 

 

 

 Total Cash Used For Operating Activities

 

 

(154,824)

 

(197,258)

 

(4,807,573)

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash Flows From Investing Activities

 

 

 

 

 

 

 

 

 

 Purchase of investments

 

 

-

 

-

 

(2,428)

 

 

 Proceeds from sale of assets

 

 

133,809

 

247,131

 

2,197,046

 

 

 Purchase of oil and gas leases and mining claims

 

 

-

 

-

 

(67,913)

 

 

 Purchase of property and equipment

 

 

-

 

-

 

(616,225)

 

 

 

 

 Total Cash Provided by Financing Activities

 

 

133,809

 

247,131

 

1,510,480

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash Flows From Financing Activities

 

 

 

 

 

 

 

 

 

 Payments on notes payable

 

 

-

 

-

 

(137,917)

 

 

 Proceeds from notes payable

 

 

-

 

-

 

277,916

 

 

 Net proceeds from issuance of common stock

 

 

-

 

-

 

3,169,127

 

 

 

 

 Total Cash Provided by Financing Activities

 

 

-

 

-

 

3,309,126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Net Increase (Decrease) in Cash and Cash Equivalents

(21,015)

 

49,873

 

12,033

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash and Cash Equivalents at Beginning of Period

 

33,048

 

6,775

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash and Cash Equivalents at End of Period

 

$

12,033

$

56,648

$

12,033

 

 

 

 

 

 

 

 

 

 

 

 

 

 Supplemental Disclosure of Cash Flow Information

 

 

 

 

 

 

 

 

 

 

 Interest paid

 

$

-

$

-

$

-

 

 

 

 Income taxes paid

 

$

-

$

-

$

-

 

 Non cash transactions

 

 

 

 

 

 

 

 

 

 

 Other comprehensive loss

 

$

222,933

$

-

 

273,049

 

 

 

 Cancellation of stock subscriptions receivable

 

$

54,209

$

-

 

654,312

 

 

 

 Issuance of 23,124,587 common shares for assets,

 

 

 

 

 

 

 

 

 

 

 

 services, and expenses

 

$

-

$

-

$

5,322,092

 

 

 

 Issuance of 18,056,658 common shares for payment

 

 

 

 

 

 

 

 

 

 

 of accounts payable

 

$

-

$

-

$

345,473

 

 

 

 Issuance of common stock for stock subscriptions

 

$

-

$

-

$

(2,450,000)

 

 

 

 Securities received for payment of receivable

 

$

-

$

-

$

58,923


The accompanying notes are an integral part of these financial statements.


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APEX RESOURCES GROUP, INC.

(Development Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Unaudited)



NOTE 1 – BASIS OF PRESENTATION


The unaudited financial statements of Apex Resources Group, Inc. (“The Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Although certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the financial statements and notes thereto for the fiscal year ended June 30, 2007.


The financial statements included herein reflect all normal recurring adjustments that, in the opinion of management, are necessary for a fair presentation. The results for interim periods are not necessarily indicative of trends or of results to be expected for the full year ended June 30, 2008.


NOTE 2 – GOING CONCERN


During the quarter ended December 31, 2007, the Company incurred a net loss of $133,908, and had a negative working capital balance of $70,696, and negative cash flow from operations of $154,824. These conditions raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.


The Company plans to generate cash for basic operational activities through the possible continued sale of assets; the possible sale of common stock; or the issuance of debt instruments to related parties. There can be no assurance that these proposed cash generating activities will be successful.




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ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.


Forward Looking Statements

Some of the statements contained in this Current Report that are not historical facts are “forward-looking statements” which can be identified by the use of terminology such as “estimates,” “projects,” “plans,” “believes,” “expects,” “anticipates,” “intends,” or the negative or other variations, or by discussions of strategy that involve risks and uncertainties. We urge you to be cautious of the forward-looking statements, that such statements, which are contained in this Current Report, reflect our current beliefs with respect to future events and involve known and unknown risks, uncertainties and other factors affecting our operations. No assurances can be given regarding the achievement of future results, as actual results may differ materially as a result of the risks we face, and actual events may differ from the assumptions underlying the statements that have been made regarding anticipated events. Factors that may cause actual results, our performance or achievements, or industry results, to differ materially from those contemplated by such forward-looking statements include without limitation:


·

our ability to raise capital when needed and on acceptable terms and conditions;

·

our ability to attract and retain management, and to integrate and maintain technical information and management information systems; and

·

general economic conditions.

All written and oral forward-looking statements made in connection with this Current Report that are attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Given the uncertainties that surround such statements, you are cautioned not to place undue reliance on such forward-looking statements. 

Revenues

During the quarter ended December 31, 2007, the Company had no revenues.

Expenses

The primary components of the net loss for the quarter were general operating expenses of $34,885 and a loss of $99,023 in regard to the disposal of office equipment. This compares to general operating expenses of $128,161 and a gain on the sale of assets of $91,608 for the quarter ended December 31, 2006. The Company had an unrealized gain of $222,933 in regard to investments available for sale for the quarter ended December 31, 2007.

Liquidity and Capital Resources

As of December 31, 2007, the Company had current assets of $57,782 and current liabilities of $128,478, for a working capital deficiency of $70,696. Included in current assets was a cash balance of $12,033. In order to meet financial obligations on an ongoing basis, the Company will need to raise cash through the sale of common stock; sale of assets; or increase of debt instruments.

Critical Accounting Policies

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the



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financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Inflation

It is our opinion that inflation has not had a material effect on our operations.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.


Not required for smaller reporting companies.



ITEM 4.  CONTROLS AND PROCEDURES


Evaluation of Disclosure Controls and Procedures


We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to be effective in providing reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “ SEC”), and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure.


In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute assurance of achieving the desired objectives. Also, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.


Changes in Internal Control over Financial Reporting


There was no change in our internal controls over financial reporting identified in connection with the requisite evaluation that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


Limitations


Our management, including our Chief Executive Officer and Principal Financial Officer (Chairman of the Board), does not expect that our disclosure controls or internal controls over financial reporting will prevent all errors or all instances of fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our



8





company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and any design may not succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Because of the inherent limitation of a cost-effective control system, misstatements due to error or fraud may occur and not be detected.


PART II


ITEM 1.

LEGAL PROCEEDINGS


None


ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS


None


ITEM 3.

DEFAULTS UPON SENIOR SECURITIES


None


ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS


None



ITEM 5.

OTHER INFORMATION


None



ITEM 6.

EXHIBITS


Exhibit Number

Description of Document

31.1

Certification of Chief Executive Office and Chief Financial Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002.

 

 

32.1

Certification of Chief Executive Officer and Chief Financial Officer pursuant Section 906 of the Sarbanes-Oxley Act of 2002.





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SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


APEX RESOURCES GROUP, INC.

(Registrant)



/s/ John Rask

By:________________________________

John Rask

President, Principal Executive Officer,

Chief Financial Officer, Principal Accounting Officer,

Secretary, Treasurer and a member of the

Board of Directors

Date:  June 20, 2011  








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