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EX-32.1 - SECTION 906 - Gold Torrent, Inc.ex32-1.htm
EX-31.1 - SECTION 302 - Gold Torrent, Inc.ex31-1.htm

 

 

 

UNITED STATES

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 June 30, 2012

 

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 number: 333-159300

 

CELLDONATE INC.

(Exact name of registrant as specified in its charter)

 

Nevada None
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification No.)
organization)  

 

8665 West Flamingo Road

Suite 131-200

Las Vegas, Nevada 89147

(Address of principal executive offices, including zip code)

 

(650) 938-3325

(Registrant’s telephone number, including area code)

 

 
(Former name, former address and former fiscal year, if changed since last report)

 

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 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 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 [  ] 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 [  ] No [X]

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 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 [  ]

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

As of August 14, 2012 the registrant’s outstanding common stock consisted of 22,910,000 shares.

 

 

  

 
 

 

Table of Contents 

 

    PART I – FINANCIAL INFORMATION     
         
Item 1.   Financial Statements   3
Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations   4
Item 3.   Quantitative and Qualitative Disclosures About Market Risk   9
Item 4.   Controls and Procedures   9
         
    PART II – OTHER INFORMATION    
         
Item 1.   Legal Proceedings   10
Item 2.   Unregistered Sales of Equity Securities   10
Item 3.   Defaults Upon Senior Securities   10
Item 4.   Mine Safety Disclosures   10
Item 5.   Other Information   10
Item 6.   Exhibits   10
         
    SIGNATURES   11

 

2
 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

The unaudited interim financial statements of Celldonate Inc. (“we”, “our”, “us”, the “Company”) follow. All currency references in this report are to US dollars unless otherwise noted.

 

 

CELLDONATE INC.

(A Development Stage Company)

June 30, 2012

 

Financial Statements

(Unaudited – Expressed in US dollars)

 

3
 

  

CELLDONATE INC.

(A Development Stage Company)

Balance Sheets

(Unaudited – Expressed in US dollars)

 

 

   June 30, 2012   March 31, 2012 
         
Assets          
           
Current          
Cash  $131,354   $40 
Loan receivable (note 5(d))   60,072    - 
    191,426    40 
Intangible asset (note 6)   2,060    - 
   $193,486   $40 
           
Liabilities          
           
Current          
Accounts payable  $30,214   $29,663 
Accrued liabilities (note 3)   5,500    7,500 
Loan payable (note 7)   195,030    - 
Due to related parties (note 5)   253,244    236,794 
           
    483,988    273,957 
           
Stockholders’ Deficiency          
           
Common Stock (note 4)          
Authorized:          
100,000,000 common shares, $0.001 par value          
400,000 common shares, without par value          
Issued and outstanding:          
22,910,000 common shares, $0.001 par value   22,910    22,910 
           
Additional Paid-in Capital   35,290    35,290 
Deficit Accumulated During the Development Stage   (348,702)   (332,117)
           
    (290,502)   (273,917)
           
   $193,486   $40 

 

Nature of operations and going concern (note 1)

 

See accompanying notes to financial statements.

 

F-1
 

 

CELLDONATE INC.

(A Development Stage Company)

Statements of Operations

(Unaudited – Expressed in US dollars)

 

   For the Three
Months Ended
June 30, 2012
   For the Three
Months Ended
June 30, 2011
   Period from
August 15, 2006
(inception) to
June 30, 2012
 
             
Expenses               
Accounting and legal  $11,057   $10,550   $207,103 
Licenses and fees   5,219    6,199    69,243 
Bank charges   309    150    2,398 
Office   -    193    5,702 
Consulting and development fees   -    -    63,728 
Amortization   -    -    528 
                
Net Loss and Comprehensive Loss for Period  $(16,585)  $(17,092)  $(348,702)
                
Basic and diluted loss per share  $(0.00)  $(0.00)     
                
Weighted average number of common shares outstanding   22,910,000    22,910,000      

 

See accompanying notes to financial statements.

 

F-2
 

 

CELLDONATE INC.

(A Development Stage Company)

Statements of Cash Flows

(Unaudited – Expressed in US dollars)

  

   For the Three
Months Ended
June 30, 2012
   For the Three
Months Ended
June 30, 2011
   Period from
August 15, 2006
(inception) to
June 30, 2012
 
             
Cash Flow from Operating Activities               
Net loss for the period  $(16,585)  $(17,092)  $(348,702)
Amortization of equipment   -    -    528 
Shares issued for services   -    -    1,150 
Changes in assets and liabilities               
Accounts payable   551    1,965    30,214 
Accrued liabilities   (2,000)   5,500    5,500 
Cash Used in Operating Activities   (18,034)   (13,557)   (311,309)
Cash Flow from Investing Activity               
Loan advanced   (60,072)   -    (60,072)
Purchase of intangible asset   (2,060)   -    (2,060)
Purchase of equipment   -    -    (528)
Cash Used in Investing Activity   (62,132)   -    (62,660)
Cash Flow from Financing Activities               
 Net proceeds from issuance of common stock   -    -    57,050 
 Loan received   195,030    -    195,030 
Advances from related parties   16,450    13,407    253,244 
Cash Provided by Financing Activities   211,480    13,407    505,324 
Increase (Decrease) in Cash   131,314    (150)   131,354 
Cash, Beginning of Period   40    1,115    - 
Cash, End of Period  $131,354   $965   $131,354 
Supplemental Information               
Stock dividend issued for no consideration  $-   $-   $20,619 
Shares issued for services  $-   $-   $1,150 
Tax paid  $-   $-   $- 
Interest paid  $-   $-   $- 

  

See accompanying notes to financial statements.

 

F-3
 

 

CELLDONATE INC.

(A Development Stage Company)

Statements of Stockholders’ Deficiency

(Unaudited – Expressed in US dollars)

 

   Shares of
Common
Stock
Issued
   Common
Stock
   Share
Subscriptions
   Additional
Paid-in
Capital
   Deficit
Accumulated
During the
Development
Stage
   Total 
                         
Balance, August 15, 2006 (inception)   -   $-   $-   $-   $-   $- 
Shares issued to founders for services   11,500,000    1,150    -    -    -    1,150 
Shares issued for cash   1,600,000    160    -    7,840    -    8,000 
Net loss for period   -    -    -    -    (55,294)   (55,294)
Balance, March 31, 2007   13,100,000    1,310    -    7,840    (55,294)   (46,144)
Shares issued for cash   1,140,000    114    -    5,586    -    5,700 
Share subscriptions received   -    -    43,350    -    -    43,350 
Net loss for year   -    -    -    -    (37,962)   (37,962)
Balance, March 31, 2008   14,240,000    1,424    43,350    13,426    (93,256)   (35,056)
Shares issued   8,670,000    867    (43,350)   42,483    -    - 
Net loss for year   -    -    -    -    (52,476)   (52,476)
Balance, March 31, 2009   22,910,000    2,291    -    55,909    (145,732)   (87,532)
Net loss for year   -    -    -    -    (63,204)   (63,204)
Balance, March 31, 2010   22,910,000    2,291    -    55,909    (208,936)   (150,736)
Stock dividend (note 6(a))   -    20,619    -    (20,619)   -    - 
Net loss for year   -    -    -    -    (59,922)   (59,922)
Balance March 31, 2011   22,910,000    22,910    -    35,290    (268,858)   (210,658)
Net loss for year   -    -    -    -    (63,259)   (63,259)
Balance, March 31, 2012   22,910,000    22,910    -    35,290    (332,117)   (273,917)
Net loss for period   -    -    -    -    (16,585)   (16,585)
Balance June 30, 2012   22,910,000   $22,910   $-   $35,290   $(348,702)  $(290,502)

  

See accompanying notes to financial statements.

F-4
 

 

CELLDONATE INC.

(A Development Stage Company)

Notes to Financial Statements

Three months ened June 30, 2012

(Unaudited – Expressed in US dollars)

   

  

1.Nature of Operations and Going Concern

 

CELLDONATE INC. (the “Company”) was incorporated under Chapter 78 of the Nevada Revised Statutes of the State of Nevada on August 15, 2006, and has its head office in Las Vegas, Nevada. The Company is a development stage company in the business of developing mobile and social media advertising solutions. The Company develops online and mobile applications, games and tools which are designed to engage consumers in transacting e-commerce transactions and presenting deals and offers to consumers. The Company will require additional financing to complete the development of its anticipated products and market them to customers. The Company has not generated any sales revenue since inception.

 

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and discharge of liabilities in the normal course of business. Several adverse conditions cast substantial doubt on the validity of this assumption. The Company has incurred losses since inception and has an accumulated deficit of $348,702 as of June 30, 2012, with limited resources and no source of operating cash flows. As at June 30, 2012, the Company has a working capital deficiency of $292,562 (March 31, 2012 - $273,917).

 

The Company’s continuance as a going concern is dependent on the success of the efforts of its directors and principal stockholders in providing financial support in the short-term, raising additional equity or debt financing either from its own resources or from third parties, and achieving profitable operations. In the event that such resources are not secured, the assets may not be realized or liabilities discharged at their carrying amounts, and the difference from the carrying amounts reported in these financial statements could be material.

 

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of the assets or the amounts and classifications of the liabilities that may result from the inability of the Company to continue as a going concern.

 

2.Significant Accounting Policies
   
(a)Basis of presentation

 

These financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (US GAAP). The Company’s functional and reporting currency is the US dollar.

 

These unaudited financial statements reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for fair presentation of the interim financial information. The results of operations for the interim period presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending March 31, 2013. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted. These unaudited financial statements and notes included herein have been prepared on a basis consistent with and should be read in conjunction with the Company’s audited financial statements and notes for the year ended March 31, 2012, as filed in its Form 10-K.

 

F-5
 

 

CELLDONATE INC.

(A Development Stage Company)

Notes to Financial Statements

Three months ened June 30, 2012

(Unaudited – Expressed in US dollars)

   

 

2.Significant Accounting Policies (continued)
   
(b)Use of estimates

 

The preparation of financial statements in conformity with US GAAP 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 financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to accounts payable and accrued liabilities, the fair value of warrants attached to common shares issued and the recoverability of income tax assets. While management believes the estimates used are reasonable, actual results could differ from those estimates and could impact future results of operations and cash flows.

 

(c)Basic and diluted loss per share

 

Basic loss per share is computed using the weighted average number of common shares outstanding. Diluted earnings per share assumes the exercise of common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. However, the calculation of diluted loss per share excludes the effects of various conversions and exercise of options and warrants that would be anti-dilutive.

 

(d)Foreign currency translation

 

Transactions in currencies other than the US dollar are translated into US dollars at the exchange rate in effect at the balance sheet date for monetary assets and liabilities, and at historical exchange rates for non-monetary assets and liabilities. Expenses are translated at the average rates for the period, except amortization, which is translated on the same basis as the related assets. Resulting translation gains or losses are reflected in net loss.

 

(e)Research and development

 

Research and development expenditures are charged to operations as incurred.

 

(f)Financial instruments

 

All financial instruments are classified as one of the following: held-to-maturity, loans and receivables, held-for-trading, available-for-sale or other financial liabilities. Financial assets and liabilities held-for-trading are measured at fair value with gains and losses recognized in net income. Financial assets held-to-maturity, loans and receivables, and other financial liabilities are measured at amortized cost using the effective interest method. Available-for-sale instruments are measured at fair value with unrealized gains and losses recognized in other comprehensive income and reported in stockholders’ equity.

 

F-6
 

 

CELLDONATE INC.

(A Development Stage Company)

Notes to Financial Statements

Three months ened June 30, 2012

(Unaudited – Expressed in US dollars)

   

 

2.Significant Accounting Policies (continued)

 

(f)Financial instruments (continued)

 

A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company prioritizes the inputs into three levels that may be used to measure fair value:

 

a)Level 1 – Applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
   
b)Level 2 – Applies to assets or liabilities for which there are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly, such as quoted prices for similar assets or liabilities in active markets, or indirectly, such as quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions.
   
c)Level 3 – Applies to assets or liabilities for which there are unobservable market data.

 

Transaction costs that are directly attributable to the acquisition or issue of financial instruments that are classified as held-to-maturity, loans and receivables, or other financial liabilities are included in the initial carrying value of such instruments and amortized using the effective interest method. Transaction costs classified as held-for-trading are expensed when incurred, while those classified as available-for-sale are included in the initial carrying value.

 

(g)Income taxes

 

The Company uses the asset and liability approach in its method of accounting for income taxes that requires the recognition of deferred tax liabilities and assets for expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. The Company recognizes the effect of uncertain tax positions where it is more likely than not based on technical merits that the position could be sustained where the tax benefit has a greater than 50% likelihood of being realized upon settlement. A valuation allowance against deferred tax assets is recorded if based upon available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

 

(h)Recent accounting guidance not yet adopted

 

The Company has reviewed recently issued accounting pronouncements and plans to adopt those that are applicable to it. It does not expect the adoption of these pronouncements to have a material impact on its financial position, results of operations or cash flows.

 

F-7
 

 

CELLDONATE INC.

(A Development Stage Company)

Notes to Financial Statements

Three months ened June 30, 2012

(Unaudited – Expressed in US dollars)

   

  

3.Financial Instruments

 

The Company has designated its cash as held-for-trading; loan receivable as loans and receivables; and accounts payable, accrued liabilities, loan payable and amounts due to related parties as other financial liabilities.

 

(a)Fair value

 

The fair values of the Company’s cash, loan receivable, accounts payable, accrued liabilities, loan payable and amounts due to related parties approximate their carrying values due to the short-term maturity of these instruments.

 

(b)Credit risk

 

Credit risk is the risk of potential loss to the Company if the counterparty to a financial instrument fails to meet its contractual obligations. The Company’s financial asset that is exposed to credit risk is cash, which is minimized to the extent that it is placed with a major financial institution. Concentration of credit risk exists with respect to the Company’s cash as all amounts are held at a single major American financial institution.

 

(c)Translation risk

 

The Company’s functional currency is the US dollar. The Company translates transactions in foreign currencies into US currency using rates on the date of the transactions. Translation risk is considered minimal as the Company does not incur any significant transactions in currencies other than US dollars.

 

(d)Interest rate risk

 

The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary current assets and liabilities.

 

(e)Liquidity risk

 

Liquidity risk is the risk that the Company will encounter difficulty in satisfying its financial obligations as they become due. The Company manages its liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities. At June 30, 2012, the Company had accounts payable of $30,214 (2011 - $21,150), which are due within 30 days or less. The Company’s loan payable of $195,030 (2011 – nil) and due to related parties of $252,244 (2011 - $236,794) have no specific terms of repayment.

 

As at June 30, 2012, accrued liabilities consist of accrued accounting and legal fees of $5,500 (2011 - $11,500).

 

4.Common Stock

 

During the three months ended June 30, 2012, no common shares were issued.

 

F-8
 

 

CELLDONATE INC.

(A Development Stage Company)

Notes to Financial Statements

Three months ened June 30, 2012

(Unaudited – Expressed in US dollars)

   

 

5.Related Party Transactions

 

(a)Due to related parties as at June 30, 2012 includes the following:
   
(i)$242,405 (March 31, 2012 - $225,955) due to a company controlled by a shareholder of the Company.
   
(ii)$7,851 (March 31, 2012 - $7,851) due to a company controlled by a shareholder of the Company for payment of legal services made on behalf of the Company.
   
(iii)$2,988 (March 31, 2012 - $2,988) due to directors of the Company for advances made to the Company.
   
(b)The Company entered into an agreement with a company controlled by a former director and major shareholder of the Company for the facilitation of its business and technology development dated August 15, 2006, as amended May 8, 2009. The agreement requires the Company to pay a monthly fee of $1,500 for services provided by the related party and to reimburse the related party for expenses incurred on its behalf. The monthly fee can be waived at the discretion of the related company. The Company incurred charges of $nil (year ended March 31, 2012 - $nil; period from August 15, 2006 to June 30, 2012 - $63,728) for the three months ended June 30, 2012 pursuant to this agreement, which has been expensed as consulting and development fees.

  

(c)In addition, for the period ended June 30, 2012, the Company was charged fees of $5,000 (three months ended June 30, 2011 - $5,000; period from August 15, 2006 to June 30, 2012 - $53,600) by the related company for administrative costs related to the Company’s filing of its regulatory documents.
   
(d)The Company advanced $60,072 (2011 - nil) to a privately-held company controlled by a former director (major shareholder) of the Company for the facilitation of an agreement between the Company and the related entity.

 

Related party transactions are recorded at the exchange amount, representing the amount agreed upon by the parties, are non-interest-bearing and have no specific terms of repayment.

 

6.Intangible Asset

 

During the three months ended June 30, 2012, of the Company purchased a domain name for $2,060. Amortization relating to the intangible asset will commence when it is put into use.

 

7.Loan Payable

 

During the three months ended June 30, 2012, the Company entered into a loan agreement with a non-related party in the principal amount of $195,030. The loan is non-interest bearing and has no specific terms of repayment.

 

8.Segmented Information

 

The Company operates primarily in one business segment being development of mobile technology with substantially all of its assets and operations located in Canada.

 

9.Subsequent Event

 

The Company has evaluated subsequent events for the period after June 30, 2012 and determined that there were no material subsequent events to be disclosed in these financial statements.

 

F-9
 

  

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Forward Looking Statements

 

This quarterly report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions.

 

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this report. Except as required by applicable law, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Our unaudited financial statements are expressed in US dollars and are prepared in accordance with generally accepted accounting principles in the United States. They reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for fair presentation of our interim financial information. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for our fiscal year ending March 31, 2013. Our unaudited financial statements and notes included therein have been prepared on a basis consistent with and should be read in conjunction with our audited financial statements and notes for the year ended March 31, 2012, as filed in our annual report on Form 10-K.

 

The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report.

 

Business Overview

 

We are a development stage company in the business of developing mobile monetization solutions and applications. Since our inception we have been creating, testing and developing mobile applications, games and tools designed to engage consumers in transacting business via mobile devices. We were incorporated as a Nevada company on August 15, 2006 and we have no subsidiaries.

 

Until recently, we were focused on completing the development of a suite of applications aimed at individuals with Internet-enabled mobile devices known as the Celldonate mobile games suite. This suite includes a number of games of chance as well as skills-based games which individuals are able to play to earn points towards redeeming prizes from participating retailers and service providers. The Celldonate mobile games suite was originally developed to provide non-profit organizations with an alternative to conventional forms of fundraising by giving them the ability to license the applications and generate ongoing donation revenue by permitting individuals to play fun, interactive games on their mobile devices and receive prizes or information for doing so.

 

4
 

 

 

Over the past few years, mobile devices, social media and tablet computing have created new market opportunities for transacting business on mobile and internet-enabled devices – as a result, we have decided to adopt a more general strategy for the Celldonate mobile games suite by renaming it as the Celldonate mobile applications suite and including online deals, coupons and e-commerce-based transactions as features. Since mobile deals and offers presented to consumers have proven to be a valuable method of engaging people to interact with local merchants, we feel that transitioning the core of our business to mobile and online transaction systems is a prudent approach.

 

So far, we have not yet entered into any commitments or agreements related to the sale or marketing of the Celldonate mobile applications suite, although we plan to concentrate our efforts on doing so in Canada and the United States. Such agreements will determine the specific manner in which we are able to generate revenues from our business.

 

We have not generated any revenues from our business activities, and we do not expect to generate revenues for the foreseeable future. Since our inception, we have incurred operational losses, and we have been issued a going concern opinion by our independent auditors. We have also accumulated net losses since our inception and incurred a net loss for the most recent audited and interim periods. To finance our operations, we have received advances from related parties, a loan payable and completed several rounds of financing.

 

Our plan of operations for the next 12 months is to develop mobile payment, mobile couponing and mobile offer-based solutions and applications. We plan to focus specifically on solutions for payments and redemptions of e-commerce-based transactions in which consumers receive mobile coupons, certificates or vouchers to be exchanged with merchants for products or services. We are seeking to enhance the experience of both consumers and merchants in this area by developing solutions that include credit card processing terminals, point-of-sale (POS) terminals and common scanning devices. Our goal is to create the most effective solution for tracking, authorizing, redeeming and settling mobile transactions on location.

 

Results of Operations

 

For the Three Months Ended June 30, 2012

 

During the three months ended June 30, 2012 we incurred a net loss of $16,585, compared to a net loss of $17,092 during the same period in the prior year (“fiscal 2011”). Our net loss from our inception on August 15, 2006 to June 30, 2012 was $348,702. We did not experience any net loss per share during the three months ended June 30, 2012 or 2011.

 

During the three months ended June 30, 2012 we incurred total expenses of $16,585 compared to total expenses of $17,092 during the same period in fiscal 2011. From our inception on August 15, 2006 to June 30, 2012 we incurred total expenses of $348,702.

 

Our total expenses during the three months ended June 30, 2012 consisted of $11,057 in accounting and legal fees, $5,219 in licenses and fees and $309 in bank charges. During the same period in fiscal 2011 our total expenses consisted of $10,550 in accounting and legal fees, $6,199 in licenses and fees, $150 in bank charges and $193 in office expenses. The decrease in our expenses for the three months ended June 30, 2012 was primarily due to a decrease in our licenses and fees for the period.

 

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Our total expenses from our inception on August 15, 2006 to June 30, 2012 consisted of $207,103 in accounting and legal fees, $69,243 in licenses and fees, $2,398 in bank charges, $63,728 in consulting and development fees, $5,702 in office expenses and $528 in amortization.

 

Liquidity and Capital Resources

 

We have limited operational history. From our inception on August 15, 2006 to June 30, 2012 we did not generate any revenues. As of June 30, 2012 we had $131,354 in cash in our bank accounts, $193,486 in total assets, $483,988 in total liabilities and a working capital deficit of $292,562. As of June 30, 2012 we had an accumulated deficit of $348,702. We are dependent on funds raised through equity financing and related parties. Our cumulative net loss of $348,702 from our inception on August 15, 2006 to June 30, 2012 was funded by equity financing, a loan payable and advances from related parties. We anticipate that we will incur substantial losses for the foreseeable future and our ability to generate any revenues in the next 12 months continues to be uncertain.

 

During the three months ended June 30, 2012 we spent $18,034 in cash on operating activities, compared to $13,557 during the same period in fiscal 2011.

 

During the three months ended June 30, 2012 we spent $62,132 in cash on investing activities, including $2,060 on the purchase of a domain name and $60,072 in the form of a loan advanced to a related party for the facilitation of an agreement between the related entity and us. We did not engage in any investing activities during the same period in fiscal 2011.

 

During the three months ended June 30, 2012 we received $211,480 in cash from financing activities, compared to $13,407 during the same period in fiscal 2011. The increase in our receipts from financing activities for the three months ended June 30, 2012 was due to an increase in advances from related parties of $3,043 and the receipt of a loan in the amount of $195,030.

 

From our inception on August 15, 2006 to June 30, 2012 we spent $311,309 in cash on operating activities and $62,660 on investing activities, and we received $505,324 in cash from financing activities, including $253,244 in advances from related parties, $57,050 in proceeds from the issuance of our common stock and $195,030 in the form of a loan payable.

 

During the three months ended June 30, 2012 our monthly cash requirements to fund our operating activities, including advances from related parties, was approximately $5,528 compared to approximately $5,697 during the same period in fiscal 2011. In the absence of the continued sale of our common stock or advances from related parties, our cash of $131,354 as of June 30, 2012 is sufficient to cover our current monthly burn rate for the foreseeable future but not enough to pay our current liabilities balance of $483,988. Until we are able to complete private and/or public financing as described below, we anticipate that we will rely on advances from related parties to proceed with our plan of operations.

 

Our plan of operations over the next 12 months is to: 

 

·obtain the necessary financing to fill a number of key operational positions;

 

·complete the development of the Celldonate applications suite, including “white label” applications for major deal and offer publishers seeking to engage their customers in mobile transactions; and

 

·enter into strategic transactions with sales and marketing agencies searching for mobile payment, mobile couponing and mobile offer-based solutions.

 

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We believe that the recent alignment of consumer and financial markets with our business model and technologies will allow us to flourish, and we plan to concentrate our efforts on capital raising, team assembly and expanding our technology base and the appeal of the Celldonate applications suite over the next 12 months. We expect to require approximately $1,750,000 to continue our planned operations during that time.

 

Our planned expenditures for the next 12 months are summarized as follows:

 

Description   Potential
Completion Date
  Estimated
Expenses
 ($)
 
Enter into strategic transactions with sales and marketing agencies   12 months   200,000 
Management and consulting fees   12 months   200,000 
Professional fees (legal, accounting and auditing fees)   12 months   100,000 
Technology development expenses (including employee salaries)   12 months   1,100,000 
Marketing expenses   12 months   100,000 
Other general and administrative expenses   12 months   50,000 
Total      1,750,000 

 

Our general and administrative expenses for the year will consist primarily of transfer agent fees, investor relations expenses and general office expenses. The professional fees are related to the costs of completing any strategic transactions into which we may enter as well as our regulatory filings throughout the year.

 

Based on our planned expenditures, we will require additional funds of approximately $1,750,000 to proceed with our business plan over the next 12 months. If we secure less than the full amount of financing that we require, we will not be able to carry out our complete business plan and we will be forced to proceed with a scaled back business plan based on our available financial resources.

 

Future Financings

 

We have not generated any revenues, have achieved losses since our inception, and rely upon the sale of our securities, loans and advances from related parties to fund our operations. We anticipate that we will incur substantial losses for the foreseeable future, and we are dependent upon obtaining outside financing to carry out our operations. Our financial statements for the three months ended June 30, 2012 have been prepared on a going concern basis and do not include any adjustments that might result from the outcome of this uncertainty.

 

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We will require approximately $1,750,000 over the next 12 months in order to enable us to proceed with our plan of operations, including paying our ongoing expenses. These cash requirements are in excess of our current cash and working capital resources. Accordingly, we intend to raise the balance of our cash requirements for the next 12 months from private placements, advances from related parties or possibly a registered public offering (either self-underwritten or through a broker-dealer). If we are unsuccessful in raising enough money through such efforts, we may review other financing possibilities such as bank loans. At this time we do not have a commitment from any broker-dealer to provide us with financing, and there is no guarantee that any financing will be available to us or if available, on terms that will be acceptable to us.

 

If we are unable to obtain the necessary additional financing, then we plan to reduce the amounts that we spend on our operations, including our accounting and legal fees, so as not to exceed the amount of capital resources that are available to us. If we do not secure additional financing our current cash reserves and working capital will not be sufficient to enable us to sustain our operations for the next 12 months, even if we do decide to scale back our operations.

 

Off-Balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

 

Critical Accounting Policies

 

Our financial statements are affected by the accounting policies used and the estimates and assumptions made by management during their preparation. A complete summary of these policies is included in Note 2 of the notes to our financial statements. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows, and which require the application of significant judgment by our management.

 

Foreign Currency Translation

 

Our financial statements are presented in United States dollars. Transactions in currencies other than the U.S. dollar are translated into U.S. dollars at the exchange rate in effect at the balance sheet date for monetary assets and liabilities, and at historical exchange rates for non-monetary assets and liabilities. Expenses are translated at the average rates for the period, excluding amortization, which is translated on the same basis as the related assets. Resulting translation gains or losses are reflected in net loss.

 

Research and Development

 

Research and development expenditures are charged to operations as incurred.

 

Recent Accounting Guidance Not Yet Adopted

 

We have reviewed recently issued accounting pronouncements and plan to adopt those that are applicable to us. We do not expect the adoption of these pronouncements to have a material impact on our financial position, results of operations or cash flows.

 

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Inflation

 

The amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

Not applicable.

 

Item 4. Controls and Procedures

 

Disclosure Controls

 

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act) designed to provide reasonable assurance the information required to be reported in our Exchange Act filings is recorded, processed, summarized and reported within the time periods specified and pursuant to Securities and Exchange Commission rules and forms, including controls and procedures designed to ensure that this information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 

As of the end of the period covered by this report, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures. Based upon this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were not effective to ensure that information we are required to disclose in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

 

Changes in Internal Control

 

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act) during the three months ended June 30, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

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PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We are not aware of any legal proceedings to which we are a party or of which our property is the subject. None of our directors, officers, affiliates, any owner of record or beneficially of more than 5% of our voting securities, or any associate of any such director, officer, affiliate or security holder are (i) a party adverse to us in any legal proceedings, or (ii) have a material interest adverse to us in any legal proceedings. We are not aware of any other legal proceedings that have been threatened against us.

 

Item 2. Unregistered Sales of Equity Securities

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

Item 5. Other Information

 

None.

 

Item 6. Exhibits

 

Exhibit
Number

  Exhibit
Description
31.1   Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1   Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to 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 Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: August 15, 2012 Celldonate Inc.
     
  By: /s/ Michael Palethorpe
    Michael Palethorpe
    President, Chief Executive Officer, Chief Financial
    Officer, Principal Accounting Officer, Secretary,
    Treasurer, Director

 

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