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EXCEL - IDEA: XBRL DOCUMENT - Zenovia Digital Exchange Corp | Financial_Report.xls |
EX-31.1 - EXHIBIT 31.1 - Zenovia Digital Exchange Corp | v313312_ex31-1.htm |
EX-32.2 - EXHIBIT 32.2 - Zenovia Digital Exchange Corp | v313312_ex32-2.htm |
EX-32.1 - EXHIBIT 32.1 - Zenovia Digital Exchange Corp | v313312_ex32-1.htm |
EX-31.2 - EXHIBIT 31.2 - Zenovia Digital Exchange Corp | v313312_ex31-2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2012
¨ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT |
For the transition period from ______________ to _____________
Commission file number 333-177792
SSTL, INC.
(Exact name of small business issuer as specified in its charter)
Nevada | 20-4168979 |
(State or other jurisdiction of incorporation or | (IRS Employer Identification No.) |
organization) |
Jason White, Chief Executive Officer
128 Commercial Dr. Mooresville, NC
(Address of principal executive offices)
(804).306.8217
(Issuer’s telephone number)
(Former name, former address and former fiscal year, if changed since last report)
Check whether the issues (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 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 x No ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ¨ No x
APPLICABLE ONLY TO CORPORATE ISSUES
Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:
As of May 5, 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 May 14, 2012.
Indicate by check mark whether the Registrant is a large accelerated filer, an accredited filer, a non-accredited filer, (or a smaller reporting company in Rule 12b-2 of the Exchange Act.(check one)
Large Accredited filer ¨ | Accelerated filer ¨ | |
Non-accredited filer¨ | Smaller reporting company x |
SSTL, Inc
TABLE OF CONTENTS
Page | |||||
Part I | FINANCIAL INFORMATION | ||||
Item 1. | Condensed Financial Statements: | 3 | |||
Condensed Balance Sheets at March 31, 2012 (unaudited) and December 31, 2011 (audited) | F-2 | ||||
Condensed Statements of Cash Flows for the three months ended March 31, 2012 and March 31, 2011, and for the period from November 10, 2010 (inception) through March 31, 2012 (unaudited) | F-4 - F-5 | ||||
Notes to Condensed Financial Statements (unaudited) | F-6 - F-8 | ||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 4 | |||
Part II | OTHER INFORMATION | ||||
Item 1. | Legal Proceedings | 5 | |||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 5 | |||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 5 | |||
Item 4. | Controls and Procedures | 6 | |||
Item 6. | Exhibits | 6 | |||
Signatures |
2 |
PART I – FINANCIAL INFORMATION
ITEM 1. Financial Statements
SSTL, INC.
FINANCIAL STATEMENTS
(Unaudited)
Quarter Ended March 31, 2012
3 |
SSTL, Inc.
Financial Statements
(Unaudited)
TABLE OF CONTENTS
Page | ||||
FINANCIAL STATEMENTS | ||||
Balance sheets | F-2 | |||
Statements of operation | F-3 | |||
Statements of cash flows | F-4 - F-5 | |||
Notes to financial statements | F-6 |
F-1 |
SSTL, Inc.
(A Development Stage Company)
BALANCE SHEETS
March 31, 2012 (Unaudited) | Dec. 31, 2011 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash | $ | 21,934 | $ | 5,047 | ||||
Accounts receivable | - | 15,000 | ||||||
Total current assets | 21,934 | 20,047 | ||||||
Fixed assets - net | 218,611 | 239,861 | ||||||
Total Assets | $ | 240,545 | $ | 259,908 | ||||
LIABILITIES & STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 885 | $ | 1,179 | ||||
Related party payable payable | - | 35,000 | ||||||
Accrued interest payable | 930 | 931 | ||||||
Note payable - current | 200,000 | 100,000 | ||||||
Total current liabilties | 201,815 | 137,110 | ||||||
Total Liabilities | 201,815 | 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; 16,254,167 shares issued and outstanding | 16,254 | 16,254 | ||||||
Additional paid in capital | 419,496 | 419,496 | ||||||
Deficit accumulated during the development stage | (397,020 | ) | (312,952 | ) | ||||
Total Stockholders' Equity | 38,730 | 122,798 | ||||||
Total Liabilities and Stockholders' Equity | $ | 240,545 | $ | 259,908 |
The accompanying notes are an integral part of the financial statements
F-2 |
SSTL, Inc.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ending | Period From Nov. 10, 2010 (Inception) To | |||||||||||
March 31, 2012 | March 31, 2011 | March 31, 2012 | ||||||||||
Revenues | $ | - | $ | - | $ | 15,000 | ||||||
Operating expenses: | ||||||||||||
Amortization & depreciation | 21,250 | 12,778 | 96,389 | |||||||||
General and administrative | 58,435 | 5,175 | 326,668 | |||||||||
79,685 | 17,953 | 423,057 | ||||||||||
Gain (loss) from operations | (79,685 | ) | (17,953 | ) | (408,057 | ) | ||||||
Other income (expense): | ||||||||||||
Insurance income | - | - | 19,077 | |||||||||
Interest expense | (4,383 | ) | (603 | ) | (8,040 | ) | ||||||
(4,383 | ) | (603 | ) | 11,037 | ||||||||
Income (loss) before provision for income taxes | (84,068 | ) | (18,556 | ) | (397,020 | ) | ||||||
Provision for income tax | - | - | - | |||||||||
Net income (loss) | $ | (84,068 | ) | $ | (18,556 | ) | $ | (397,020 | ) | |||
Net income (loss) per share | ||||||||||||
(Basic and fully diluted) | $ | (0.01 | ) | $ | (0.01 | ) | ||||||
Weighted average number of common shares outstanding | 16,254,167 | 2,930,000 |
The accompanying notes are an integral part of the financial statements
F-3 |
SSTL, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Months Ending | Period From Nov. 10, 2010 (Inception) | |||||||||||
Ended | Ended | To | ||||||||||
March 31, 2012 | March 31, 2011 | March 31, 2012 | ||||||||||
Cash Flows From Operating Activities: | ||||||||||||
Net income (loss) | $ | (84,068 | ) | $ | (18,556 | ) | $ | (397,020 | ) | |||
Adjustments to reconcile net loss to net cash provided by (used for) operating activities: | ||||||||||||
Amortization & depreciation | 21,250 | 12,778 | 96,389 | |||||||||
Accounts receivable | 15,000 | - | - | |||||||||
Compensatory stock issuances | - | - | 104,000 | |||||||||
Accrued payables | (295 | ) | 603 | $ | 36,816 | |||||||
Net cash provided by (used for) operating activities | (48,113 | ) | (5,175 | ) | (159,815 | ) | ||||||
Cash Flows From Investing Activities: | ||||||||||||
Fixed assets | - | - | (25,000 | ) | ||||||||
Net cash provided by (used for) investing activities | - | - | (25,000 | ) |
(Continued on Following Page)
The accompanying notes are an integral part of the financial statements.
F-4 |
SSTL, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
(Continued From Previous Page)
For the Three Months Ending | Period From Nov. 10, 2010 (Inception) | |||||||||||
Ended | Ended | To | ||||||||||
March 31, 2012 | March 31, 2011 | March 31, 2012 | ||||||||||
Cash Flows From Financing Activities: | ||||||||||||
Note payable - borrowings | 75,000 | 50,000 | 225,000 | |||||||||
Note payable - payments | (10,000 | ) | - | (60,000 | ) | |||||||
Issuance of stock for cash | - | 1,000 | 36,750 | |||||||||
Paid in capital | - | 5,000 | 5,000 | |||||||||
Net cash provided by (used for) financing activities | 65,000 | 56,000 | 206,750 | |||||||||
Net Increase (Decrease) In Cash | 16,887 | 50,825 | 21,935 | |||||||||
Cash At The Beginning Of The Period | 5,047 | - | - | |||||||||
Cash At The End Of The Period | $ | 21,934 | $ | 50,825 | $ | 21,935 | ||||||
Schedule Of Non-Cash Investing And Financing Activities | ||||||||||||
Common stock issued for assets | $ | - | $ | - | $ | 290,000 | ||||||
Supplemental Disclosure: | ||||||||||||
Cash paid for interest | $ | 4,383 | $ | - | $ | 7,109 | ||||||
Cash paid for income taxes | $ | - | $ | - | $ | - |
The accompanying notes are an integral part of the financial statements.
F-5 |
SSTL, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
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.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year.
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.
Property and equipment
Property and equipment are recorded at cost and depreciated under accelerated or straight line methods over each item's estimated useful life.
F-6 |
SSTL, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
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.
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.
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.
F-7 |
SSTL, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):
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.
F-8 |
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Three Months Ended March 31, 2012 Compared to Three Months Ended March 31, 2011
Revenues
There were no revenues for the three months ended March 31, 2012 and the same for the same period ending March 31, 2011. The lack of revenues for the company during these periods are due to the start up period of the company and the lack of current customers.
Cost of Revenues
There were no costs of revenues for the three months ended March 31, 2012 or the three months ended March 31, 2011.
Operating Expenses
Operating expenses for the three months ended March 31 2012 were $79,685 or 100% of revenue compared to $17,953 or 100% of revenue for the same period ended March 31, 2011. The increase in operating expenses was due to an overall increase in general and administrative expenses, including $5,300 in contract labor, $29,115 in professional fees, $4,200 in rent expenses, $19,077 in repairs and maintenance and $693 in utilities. Depreciation and amortization expenses for the three months ended March 31, 2012 was $21,250 or 100% of revenue compared to $12,778 or 100% of revenue for the same period in 2011.
Interest and Financing Costs
Interest and financing costs for the three months ended March 31 2012 were $(4,383) or 100% of revenue compared to $(603) or 100% of revenue for the period ended March 31, 2011. The increase for the three months period ended March 31, 2012 as compared to the same period in 2011 was due to an increase in indebtedness in the Company.
Other Non-operating Income
The Company had zero non-operating income for the three month ended March 31, 2012 compared to the same for the same period in 2011.
Net Loss
Net loss for the three months ended March 31, 2012 was $(84,068) or 100% of revenue compared to $(18,556) or 100% of revenue for the same period ended March 31, 2011. The increase in the net loss for this period in 2012 is due to a increase in general and administrative costs, specifically our professional fees and repairs and maintenance expenses..
4 |
LIQUIDITY AND CAPITAL RESOURCES
Cash
Our primary source of liquidity is cash provided by operating, investing, and financing activities. Net cash used in operations for the three months ended March 31, 2012 was $(48,112) as compared to $(5,175) for the period ended March 31, 2011. During the three months ended March 31, 2012 we used $(48,112) in cash from operating activities.
Liquidity
The accompanying consolidated financial statements have been prepared assuming that the company will continue as a going concern. The Company incurred a net loss of $(84,068) and utilized cash in operating activities of $(48,112) during the three months ended March 31, 2012. These matters raise substantial doubt about the Company’s ability to continue as a going concern. As of March 31, 2012 the Company had current assets that exceeded current liabilities by $38,730.
The Company’s current source of cash is capital raised for its operations, advances drawn down on the company’s line of credit and proceeds from the sale of its common stock. The Company will continue to explore other sources of capital to expand and fund its current operations.
Cash Flows for the Three Months Ended March 31, 2012.
Operating activities for the three months ended March 31, 2012 produced no cash. As of March 31, 2012 accounts payable increased to $885. Depreciation and amortization for the three months ended March 31, 2012 totaled $21,250, an increase from $5,175 for the same period in 2011. There were no prepaid expenses for the period.
Net cash used by financing activities was $(65,000) for the three months ended March 31, 2012, compared to $56,000 for the same period of 2011. Cash for the three months ended March 31, 2012 was $21,934 compared to $50,825 for the same period in 2011.
Stockholder Matters
Stockholder’s equity was $38,730 on March 31, 2012, or $ 0.004 per share outstanding. As of March 31, 2011 stockholder’s equity was $277,444 or $ 0.028 per share outstanding.
PART II – OTHER INFORMATION
ITEM 1. Legal Proceedings
We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or material pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the three months ended March 31, 2012, the Company did not sell or issue any shares .
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk.
As a “smaller reporting company,” we are not required to provide the information under this Item 3.
5 |
ITEM 4. Controls and Procedures
(a) Evaluation of disclosure controls and procedures. Based on the evaluation of our disclosure controls and procedures (as defined in Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e) required by Securities Exchange Act Rules 13a-15(b) or 15d-15(b), our Chief Executive Officer/Chief Financial Officer has concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective.
(b) Changes in internal controls. There were no changes in our internal controls over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 6. Exhibits
Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-K
SEC Ref. No. |
Title of Document | |
31.1 | Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
31.2 | Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
32.1 | Certification of the Principal Executive Officer pursuant to U.S.C. pursuant to Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002* | |
32.2 | Certification of the Principal Financial Officer pursuant to U.S.C. pursuant to Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002* |
* Filed herewith.
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SSTL, INC.
May 14, 2012
By: | /s/ Jason White | |
Jason White | ||
Chief Executive Officer |
6 |