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EX-31.2 - EXHIBIT 31.2 - SSTL, Inc.v309525_ex31-2.htm
EX-32.2 - EXHIBIT 32.2 - SSTL, Inc.v309525_ex32-2.htm
EX-31.1 - EXHIBIT 31.1 - SSTL, Inc.v309525_ex31-1.htm
EX-32.1 - EXHIBIT 32.1 - SSTL, Inc.v309525_ex32-1.htm

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

  

FORM 10-K

 

SPECIAL FINANCIAL REPORT PURSUANT TO Rule 15(d) - 2

 

þ Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934.

 

Contains only financial statements for the fiscal year ended December 31, 2011.

 

Commission file number: File No. 333-177792

  

SSTL, Inc.

(Name of small business issuer in its charter)

 

Nevada   27-3952902
(State or other jurisdiction of   (I.R.S. Employer Identification No.)
incorporation or organization)    
     
128 Commercial Dr.   28115
Mooresville, NC   (Zip Code)
(Address of principal executive offices)    

 

(804).306.8217

(Issuer's telephone number)

 

Securities registered under Section 12(b) of the Exchange Act:

None

 

Securities registered under Section 12(g) of the Exchange Act:

None

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o  No x

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o  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 o  No x

 

 

 
 

 

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 (§203.405 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 o  No T

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference into Part III of this Form 10-K or any amendment to this Form 10-K.  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 Act.

 

Large accelerated filer o   Accelerated filer o
Non-accelerated filer £   Smaller reporting company T

 

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

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13, or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  Yes £  No T

 

As of March 30, 2012, there was no public trading market for the registrant’s common stock.  There were 16,254,167 shares of the registrant’s common stock, $0.001 par value per share, outstanding on March 30, 2012.

 

The aggregate market value of the registrant’s common stock, $0.001 par value per share, held by non-affiliates of the registrant on March 31, 2012, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $71,500 (based on the offering price at which the Registrant’s common stock was last sold ). Shares of the registrant’s common stock held by each officer and director and each person known to the registrant to own 10% or more of the outstanding voting power of the registrant have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not a determination for other purposes.

          Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

     
Class   Outstanding at April 15, 2012
Common Stock, $0.001 par value per share   16,254,167 shares
     

 

 

DOCUMENTS INCORPORATED BY REFERENCE

 

None.

 

2
 

 

Explanatory Note

 

Rule 15d-2 under the Securities Exchange Act of 1934, as amended, provides generally that if a company files a registration statement under the Securities Act of 1933, as amended, which does not contain certified financial statements for the company’s last full fiscal year (or for the life of the company if less than a full fiscal year), then the company must, within 90 days after the effective date of the registration statement, file a special report furnishing certified financial statements for the last full fiscal year or other period, as the case may be. Rule 15d-2 further provides that the special financial report is to be filed under cover of the facing sheet of the form appropriate for annual reports of the company.

 

SSTL, Inc.’s Registration Statement on Form S-1 did not contain the certified financial statements for the year ended December 31, 2011, as contemplated by Rule 15d-2. Therefore, as required by Rule 15d-2, SSTL, Inc is hereby filing such certified financial statements with the SEC under cover of the facing page of an Annual Report of Form 10-K.

 

Controls and Procedures

 

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective to enable us to record, process, summarize and report information required to be included in the Company’s periodic SEC filings and annual proxy statement within the required time period.

 

There have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2011 that have materially affected, or are likely to materially effect, our internal control over financial reporting.

 

 

 

3
 

 

SSTL, Inc.

A Development Stage Company)

 

FINANCIAL STATEMENTS

 

For The Nine Months Ended

December 31, 2011

 

 

 

 

4
 

   

SSTL, Inc.

(A Development Stage Company)

Financial Statements

  

TABLE OF CONTENTS

 

  Page
   
REPORT OF INDEPENDENT REGISTERED  
    PUBLIC ACCOUNTING FIRM    F-1
   
   
FINANCIAL STATEMENTS  
   
Balance sheets     F-2
Statements of operations     F-3
Statements of stockholders’ equity     F-4
Statements of cash flows     F-5
Notes to financial statements    F-7

 

5
 

   

RONALD R. CHADWICK, P.C.

Certified Public Accountant

2851 South Parker Road, Suite 720

Aurora, Colorado 80014

Telephone (303)306-1967

Fax (303)306-1944

  

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

Board of Directors

SSTL, Inc.

Mooresville, North Carolina

 

I have audited the accompanying balance sheet of SSTL, Inc. as of December 31, 2011, and the related statements of operations, stockholders' equity and cash flows for the nine months ended December 31, 2011, and for the period from November 10, 2010 (Inception) through December 31, 2011. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit.

 

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. 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. I believe that my audit provides a reasonable basis for my opinion.

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of SSTL, Inc. as of December 31, 2011, and the results of its operations and its cash flows for the nine months ended December 31, 2011, and for the period from November 10, 2010 (Inception) through December 31, 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 discussed in Note 7 to the financial statements, the Company has suffered a loss from operations that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 7. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Aurora, Colorado Ronald R. Chadwick, P.C.
April 16, 2012 RONALD R. CHADWICK, P.C.

  

F-1
 

 

 

SSTL, Inc.
(A Development Stage Company)
BALANCE SHEET

 

   Dec. 31, 2011 
     
ASSETS     
      
Current assets     
Cash  $5,047 
Accounts receivable   15,000 
Total current assets   20,047 
      
Fixed assets - net   239,861 
      
Total Assets  $259,908 
      
LIABILITIES & STOCKHOLDERS' EQUITY     
      
Current liabilities     
Accounts payable  $1,179 
Related party payable   35,000 
Accrued interest payable   931 
 Note payable - current   100,000 
Total current liabilties   137,110 
      
Total Liabilities   137,110 
      
Stockholders' Equity     
     Preferred stock, $.001 par value;     
        25,000,000 shares authorized;     
        none issued and outstanding   - 
     Common stock, $.001 par value;     
        100,000,000 shares authorized;     
        9,766,667 (March 2011) and     
        16,254,167 (Dec. 2011)   16,254 
        shares issued and outstanding     
     Additional paid in capital   419,496 
     Deficit accumulated during the     
        development stage   (312,952)
      
Total Stockholders' Equity   122,798 
      
Total Liabilities and Stockholders' Equity  $259,908 

 

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

 

F-2
 

 

SSTL, Inc.
(A Development Stage Company)
STATEMENT OF OPERATIONS

  

       Period From 
       Nov. 10, 2010 
   Nine Months   (Inception) 
   Ended   To 
   Dec. 31, 2011   Dec. 31, 2011 
         
Revenues  $15,000   $15,000 
           
Operating expenses:          
    Amortization & depreciation   62,361    75,139 
    General and administrative   263,058    268,233 
    325,419    343,372 
           
Gain (loss) from operations   (310,419)   (328,372)
           
Other income (expense):          
    Insurance income   19,077    19,077 
    Interest expense   (3,054)   (3,054)
    16,023    16,023 
Income (loss) before          
    provision for income taxes   (294,396)   (312,349)
           
Provision for income tax   -    - 
           
Net income (loss)  $(294,396)  $(312,349)
           
Net income (loss) per share          
(Basic and fully diluted)  $(0.03)     
           
Weighted average number of          
common shares outstanding   11,538,195      

 

 

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

 

F-3
 

 

 

SSTL, Inc.
(Development Stage Company)
STATEMENTS OF STOCKHOLDERS' EQUITY

 

   Common Stock       Deficit
Accumulated
During The
   Stock- 
       Amount   Additional   Development   holders' 
   Shares   ($.001 Par)   Paid in Capital   Stage   Equity 
                          
Balances at November 10, 2010   -   $-   $-   $-   $- 
                          
Shares issued for cash   100,000    100    900    -    1,000 
                          
Shares issued for assets   9,666,667    9,667    280,333    -    290,000 
                          
Capital contributions - related party   -    -    5,000    -    5,000 
                          
Net income (loss) for the period                  (18,556)   (18,556)
                          
Balances at March 31, 2011   9,766,667   $9,767   $286,233   $(18,556)  $277,444 
                          
Shares issued for cash   1,787,500    1,787    33,963    -    35,750 
                          
Shares issued for services   4,700,000    4,700    99,300    -    104,000 
                          
Net income (loss) for the period                  (294,396)   (294,396)
                          
Balances at December 31, 2011   16,254,167   $16,254   $419,496   $(312,952)  $122,798 

 

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

 

F-4
 

 

 

SSTL, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS

 

 

       Period From 
       Nov. 10, 2010 
   Nine Months   (Inception) 
   Ended   To 
   Dec. 31, 2011   Dec. 31, 2011 
           
Cash Flows From Operating Activities:          
    Net income (loss)  $(294,396)  $(312,952)
           
    Adjustments to reconcile net loss to          
    net cash provided by (used for)          
    operating activities:          
         Amortization & depreciation   62,361    75,139 
         Accounts receivable   (15,000)   (15,000)
         Compensatory stock issuances   104,000    104,000 
         Accrued payables   36,507   $37,110 
Net cash provided by (used for)          
operating activities   (106,528)   (111,703)
           
           
           
Cash Flows From Investing Activities:          
         Fixed assets   (25,000)   (25,000)
Net cash provided by (used for)          
              investing activities   (25,000)   (25,000)

 

(Continued on Following Page)

 

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

 

F-5
 

 

 

SSTL, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
 
 
(Continued From Previous Page)

 

       Period From 
       Nov. 10, 2010 
   Nine Months   (Inception) 
   Ended   To 
   Dec. 31, 2011   Dec. 31, 2011 
           
Cash Flows From Financing Activities:          
         Note payable - borrowings   100,000    150,000 
         Note payable - payments   (50,000)   (50,000)
         Issuance of stock for cash   35,750    36,750 
         Paid in capital   -    5,000 
Net cash provided by (used for)          
financing activities   85,750    141,750 
           
Net Increase (Decrease) In Cash   (45,778)   5,047 
           
Cash At The Beginning Of The Period   50,825    - 
           
Cash At The End Of The Period  $5,047   $5,047 
           
Schedule Of Non-Cash Investing And Financing Activities     
           
Common stock issued for assets  $290,000   $290,000 
           
Supplemental Disclosure:          
           
Cash paid for interest  $2,726   $2,726 
Cash paid for income taxes  $-   $- 

 

 

The accompanying notes are an integral part of the financial statements

 

F-6
 

  

SSTL, Inc.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

SSTL, Inc. (the “Company”) was incorporated in the State of Nevada on November 10, 2010. The Company designs and assembles motorsport racing vehicles for its own use, and plans to compete in organized racing events. The Company has currently only conducted limited activities and is considered to be in the development stage.

 

Fiscal year

 

The Company in fourth quarter 2011 changed its fiscal year end from March 31 to December 31.

 

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

 

Cash and cash equivalents

 

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.

 

Accounts receivable

 

The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. At December 31, 2011 the Company had no balance in allowance for doubtful accounts.

 

Property and equipment

 

Property and equipment are recorded at cost and depreciated under straight line methods over each item's estimated useful life. The Company uses a three year life for racing vehicles, and five years for transport vehicles and furniture and fixtures.

F-7
 

 

SSTL, Inc.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

 

Revenue recognition

 

Revenue is recognized on an accrual basis as earned under contract terms.

 

Advertising costs

 

Advertising costs are expensed as incurred. The Company recorded advertising costs for the nine months ended December 31, 2011 of $1,314.

 

Income tax

 

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

 

Net income (loss) per share

 

The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.

 

Financial Instruments

 

The carrying value of the Company’s financial instruments, as reported in the accompanying balance sheets, approximates fair value.

 

 

F-8
 

 

SSTL, Inc.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

 

Long-Lived Assets

 

In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that may suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value.

 

Products and services, geographic areas and major customers

 

The Company plans to earn revenue from race purses and the sale of advertising to racing sponsors, but does not separate sales of different activities into operating segments. The Company has had no revenues.

 

Stock based compensation

 

The Company accounts for employee and non-employee stock awards under ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable.

 

 

NOTE 2. RELATED PARTY TRANSACTIONS

 

In the nine months ended December 31, 2011 an officer advanced the Company $35,000 for working capital on a verbal, noninterest bearing, due on demand basis, and the officer was issued 1,000,000 common shares for consulting services provided to the Company valued at $30,000.

 

 

F-9
 

  

SSTL, Inc.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 3. FIXED ASSETS

 

Fixed asset values recorded at cost are as follows:

 

   Dec. 31, 
   2011 
Racing vehicles and equipment  $165,000 
Transport vehicles   150,000 
    315,000 
Less accumulated depreciation   (75,139)
Total  $239,861 

  

Depreciation expense in for the nine months ended December 31, 2011 was $62,361.

 

 

NOTE 4. NOTES PAYABLE

 

The Company at December 31, 2011 had notes payable to a related party for $100,000 with $50,000 due in June 2012 and $50,000 in December 2012, unsecured, bearing interest at 10% per annum, with required monthly principal payments of $4,166 on each note. Interest expense for the nine months ended December 31, 2011 was $3,054 with accrued interest payable at December 31, 2011 of $931.

 

 

NOTE 5. INCOME TAXES

 

Deferred income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses. These loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur.

 

At December 31, 2011 the Company had net operating loss carryforwards of approximately $313,000 which begin to expire in 2031. The deferred tax asset of $63,000 created by the net operating loss has been offset by a 100% valuation allowance. The change in the valuation allowance for the nine months ended December 31, 2011 was $59,000.

 

 

F-10
 

 

SSTL, Inc.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 6. COMPARABLE PRIOR PERIOD

 

The Company had no operations from November 10, 2010 (inception) through December 31, 2010.

 

NOTE 7. GOING CONCERN

 

The Company has suffered a loss from operations which raises substantial doubt about the Company’s ability to continue as a going concern. Continued losses could cause the Company to be unable to continue in the racing industry or to meet debt obligations. The Company believes that racing requires significant capital outlays on a continual basis to successfully fund operations, but with adequate funding that profitable operations can be achieved.

 

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions. By doing so, the Company hopes to generate profits from racing activities. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

 

 

F-11
 

 

 EXHIBITS

 

Exhibit 
Number
  Description
31.1   Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)
31.2   Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
32.1   Certification of the Chief Executive Officer pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2   Certification of the Chief Financial Officer pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

 

 

6
 

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on April 15, 2012.

 

  SSTL, Inc.
   
   
  By: /s/ Jason White
    Jason white
    President and Chief Executive Officer

 

 

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 dates indicated.

 

           
Name   Title   Date  
           
/s/ Jason White    Chief Executive Officer & Director   April 15, 2012  
Jason White   (Principal Executive Officer)      
           
/s/ Susan Lokey   Chief Financial Officer & Director   April 15, 2012  
Susan Lokey   (Principal Accounting Officer)      
               

 

 

 

7
 

  

EXHIBIT INDEX

 

Exhibit
Number
  Description
31.1   Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)
31.2   Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
32.1   Certification of the Chief Executive Officer pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2   Certification of the Chief Financial Officer pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

8