Attached files

file filename
EXCEL - IDEA: XBRL DOCUMENT - XTRALINK CorpFinancial_Report.xls
EX-31 - XTRALINK Corpex311.htm
EX-32 - XTRALINK Corpex321.htm
 

 



 

FORM 10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended October 31, 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 000-54508

 

XTRALINK CORP.

(Exact name of registrant as specified in its charter)

 

Nevada

 

27-3187919

 (State or other jurisdiction of incorporation or organization)

 

 (I.R.S. Employer Identification Number)

                                                                                        

7582 Las Vegas Boulevard, Suite #325

Las Vegas, Nevada 89123

(Address of principal executive offices)

 

(702)-637-6144

(Registrant’s telephone number, including area code)

 

No change

(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 website, 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 definitions of “ large accelerated filer,” “accelerated filer” and “smaller reporting company”  in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer                                                                                 Accelerated filer                     

Non-accelerated filer                                                                                   Smaller reporting company  x

(Do not check if a smaller reporting company)                                                                                                   

 

1


 
 

 

 

 

 

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

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 35,510,000 shares of common stock, par value $.0001 per share, outstanding as of December 12, 2012.

 

 

2


 
 

 

 

 

 

XTRALINK CORP.

 

- INDEX -

 

PART I – FINANCIAL INFORMATION:

 Page 

 

 

 

Item 1.

Financial Statements:

 4

 

 

 

 

Balance Sheets as of October 31, 2012 (unaudited) and July 31, 2012 (audited)

5

 

 

 

 

Statements of Operations (unaudited) for the Three Month Periods Ended October 31, 2012 and 2011

6

 

 

 

 

Statements of Cash Flows (unaudited) for the Three Month Periods Ended October 31, 2012 and 2011

7

 

 

 

 

Notes to Financial Statements (unaudited)

8

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

9

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

12

 

 

 

Item 4.

Controls and Procedures

12

 

 

 

PART II – OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

12

 

 

 

Item 1A.

Risk Factors

12

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

12

 

 

 

Item 3.

Defaults Upon Senior Securities

12

 

 

 

Item 4.

Removed and Reserved

12

 

 

 

Item 5.

Other Information

12

 

 

 

Item 6.

Exhibits

13

 

 

 

Signatures

14

     

 

 

3


 
 

 

 

 

PART I – FINANCIAL INFORMATION

 

 

 

Item 1.  Financial Statements.


 

XTRALINK CORP.

 

 

FINANCIAL STATEMENTS

 

OCTOBER 31, 2012

 

 

4


 
 

 

 

XTRALINK CORP.

BALANCE SHEETS

 

October 31, 2012

(Unaudited)

July 31, 2012

(Audited)

ASSETS

 

 

 

 

 

Current Asset:

 

 

    Cash

$            13,801

$           38,868

 

 

 

    Total Current Assets

13,801

38,868

 

 

 

Other Asset

 

 

    Intangible asset – License

40,000

40,000

    Accumulated amortization

(833)

-

    Total Other Assets

39,167

40,000

 

 

 

Total Assets

$            52,968

$            78,868

 

 

 

LIABILITIES AND SHAREHOLDERS’ DEFICIT

 

 

 

 

 

Current Liabilities:

 

 

    Accounts payable

$            11,810

$              7,810

    ue to licensor

-

40,000

    Unearned revenue

4,000

-

    Due to shareholder

36,425

33,425

 

 

 

Total Liabilities

52,235

81,235

 

 

 

Shareholders’ Deficit

 

 

Common stock, $.0001 par value, 200,000,000 shares authorized, 35,510,000 shares issued and outstanding

3,551

3,551

Capital in excess of par value

11,950

11,950

Deficit accumulated

(14,768)

(17,868)

Total shareholders’ deficit

733

(2,367)

 

 

 

Total Liabilities and Shareholders’ Deficit

$            52,968

$            78,868

 

 

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

 

-F1-

 

5


 
 

 

XTRALINK CORP.

STATEMENTS OF OPERATIONS

(unaudited)

 

 

Three Month Periods Ended
October,

 

2012

2011

 

 

 

 

 

 

Revenues

$                  12,000

$                        -

 

 

 

General and Administrative Expenses:

 

 

Professional fees

8,000

-

Amortization

833

 

Other

67

 

 

 

 

Total expenses

8,900

-

Net income

$                   3,100

$                       -

 

 

 

Net income per common share -

 

 

    basic and diluted

$                          -

$                       -

 

 

Weighted average number of common

 

 

    shares outstanding

35,510,000

25,010,000

 

 

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

 

 

-F2-

 

6


 
 

 

XTRALINK CORP.

STATEMENTS OF CASH FLOWS

FOR THE THREE MONTH PERIODS ENDED OCTOBER 31, 2012 and 2011

(unaudited)

 

 

2012

2011

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

Net income

$                     3,100

$                              -

 

 

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

Charges not requiring the outlay of cash:

 

 

Amortization

833

 

Changes in assets and liabilities:

 

 

Increase in accounts payable

4,000

-

Increase in unearned revenue

4,000

 

 

 

 

Net cash provided by operating activities

11,933

-

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

-

-

 

 

 

Acquisition of license

(40,000)

-

Net cash consumed by investing activities

(40,000)

-

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

Proceeds from shareholder loan

3,000

 

 

 

 

Net cash provided by financing activities

3,000

-

 

 

 

Net change in cash balance

(25,067)

-

 

 

 

Cash, at beginning of period

38,868

-

 

 

 

Cash, at end of period

$                    13,801

$                            -

 

 

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

 

-F3-

 

7

 


 
 

 

 

 

XTRALINK CORP.

NOTES TO FINANCIAL STATEMENTS

OCTOBER 31, 2012

(unaudited)

 

 

 NOTE 1- BASIS OF PRESENTATION

The unaudited interim financial statements of XTRALINK CORP.as of October 31, 2012 and for the three month periods ended October 31, 2012 and 2011 have been prepared in accordance with United States generally accepted accounting principles (“GAAP”). In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such comparable periods. The results of operations for the three month period ended October 31, 2012 are not necessarily indicative of the results to be expected for the full fiscal year ending July 31, 2013.

Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements for fiscal year ended July 31, 2012.

 

NOTE 2 - Related Party Transaction

 

During the quarter year ended October 31, 2012, we received an additional $ 3,000 in shareholder loans to fund working capital needs.  The total shareholder loan balance is currently $ 36,425.  That advance does not bear interest and has no stated terms for repayment.  

 

NOTE 3 - GOING CONCERN

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company has an accumulated deficit , has a working capital deficiency and does not presently have sufficient resources to accomplish its objectives during the next twelve months. These conditions raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation. The Company’s present plans to overcome these difficulties include, but are not limited to, the continuing effort to raise capital, primarily through shareholder loans and equity financing.

 

-F4-

 

8


 
 

 

 

 

 

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

 

Forward Looking Statement Notice

 

Certain statements made in this Quarterly Report on Form 10-Q are “forward-looking statements” (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding the plans and objectives of management for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of XTRALINK CORP. (“we”, “us”, “our” or the “Company”) to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company's plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance the forward-looking statements included in this Quarterly Report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.

 

Description of Business

 

The Company was incorporated in the State of Nevada on July 29, 2010 (Inception) and maintains its principal executive office at 7582 Las Vegas Boulevard #325, Las Vegas Nevada.  Since inception, the Company has been engaged in organizational efforts and obtaining initial financing. The Company was formed as a vehicle to pursue a business combination through the acquisition of, or merger with, an operating business. The Company filed a registration statement on Form 10 with the U.S. Securities and Exchange Commission (the “SEC”) on September 30, 2011, and since its effectiveness, the Company has focused its efforts to identify a possible business combination.

 

On June 10, 2012, we entered into a Licensing Agreement (the “Agreement”) with Oxford International Inc. (“Oxford”), to license proprietary technology relating to converting municipal water to oxygen enriched pH balanced water (the “Water Conversion Technology”).  We obtained exclusive licensing rights in the country of Singapore for a period of 20 years.  We will have exclusive rights to sub-license, establish joint ventures and to commercialize products through the methods of the Water Conversion Technology.   The license fee, $ 40,000, was payable on or before June 30, 2012.  Oxford subsequently granted us an extension until August 31, 2012.  Full payment of the license fee was made on August 15, 2012.  We are subject to a royalty of 2% on licensee fees received from appointed sub-licensees as well as 2% on gross sales generated from operations.  We are obligated to establish water bottling operations by December 31, 2013.  In the event that we have not established operations by this date, Oxford has a right to void the Agreement.  The 2% royalty on license fees has been waived by Oxford until January 31, 2013.

 

Our business objective is to license the Water Conversion Technology through qualified interests and establish bottled water operations through a joint venture. 

 

On June 13, 2012, we entered into a Sub-License Agreement with Lumut Technologies Ltd. (“Lumut”), to grant exclusive rights to sub-license, establish joint ventures and to commercialize products through the methods of the Water Conversion Technology for a period of 20 years in the country of Singapore. Lumut will be subject to a sub-license fee of $ 60,000 payable in monthly installments of $ 4,000 per month commencing June 1, 2012 ending, October 1, 2013.  The commencement date was subsequently amended to August 15, 2012, ending December 15, 2013.  As per our Agreement with Oxford, 2% of any sub license fees received is payable on a quarterly basis.  As additional consideration, gross sales from products generated from use of the Water Conversion Technology will be

 

9


 
 

 

subject to a 5% royalty fee of which 2% is payable to Oxford and 3% will be retained by us. Lumut will also be required to establish bottled water operations by December 31, 2013 and in the event that this is not achieved, our agreement with Lumut will be void.  License fees paid are not refundable.

 

We have a right to participate in joint venture operations with Lumut for a $ 150,000 investment for 40% ownership of the joint venture.  We intend on entering into a joint venture agreement with Lumut to establish bottled water operations and are currently negotiating terms.  There can be no assurance that a joint venture agreement will materialize.

 

During the next twelve months we anticipate incurring costs related to filing Exchange Act reports, legal and audit costs and furthering our efforts in establishing bottled water operations.

   

We believe we will be able to meet these costs with funds to be loaned to or invested in us by our shareholders, management or other investors. As of the date of the period covered by this report, we have $13,801 in cash. There are no assurances that the Company will be able to secure any additional funding as needed.  Currently, however our ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due.  

 

 

Liquidity and Capital Resources

 

As of October 31, 2012, the Company had assets comprised of cash ($13,801) and an investment in our Water Conversion Technology license ($40,000).  The Company’s current liabilities as of October 31, 2012 totalled $ 52,235, comprised of accrued liabilities of professional fees, unearned revenue relating to license fee payment for the month of November from Lumut and amounts due to shareholder.    

 

The Company will require approximately $ 31,000 to fund its working capital needs as follows:

 

 

Filing fees

5,000

Audit and accounting

15,000

Professional fees

10,000

Miscellaneous

1,000

 

 

Total

$         31,000

 

 

Additionally, the shareholder loan in the amount of $36,425 is a demand note due and while we do not anticipate a requirement to repay the note, there is no guarantee.

 

We can provide no assurance that the Company can continue to satisfy its cash requirements for at least the next twelve months.

 

We expect to obtain financing through shareholder loans and private placements and also meet our working capital needs from license fees generated from our sub license agreement with Lumut.  The license fee receivable is $ 4,000 per month.   Shareholder loans will be without stated terms of repayment or interest.  We will not consider taking on any long-term or short-term debt from financial institutions in the immediate future. Shareholders loans may be granted from time to time as required to meet current working capital needs.  We have no formal agreement that ensures that we will receive such loans. We may exhaust this source of funding at any time. 

 

10


 
 

 

We are dependent upon certain related parties to provide continued funding and capital resources. If continued funding and capital resources are unavailable at reasonable terms, we may not be able to implement our plan of operations.

 

Sources of Capital:

 

We expect to sustain our working capital needs with the monthly license fee of $ 4,000 as per our agreement with Lumut and also through shareholder loans and private placements.   Shareholder loans will be without stated terms of repayment or interest.  We will not consider taking on any long-term or short-term debt from financial institutions in the immediate future. Shareholders loans may be granted from time to time as required to meet current working capital needs.  We have no formal agreement that ensures that we will receive such loans. We may exhaust this source of funding at any time.  License fees from Lumut commenced August 15, 2012 and will continue until December 15, 2013.  There can be no assurance that such fees will be paid on a timely basis.

 

Results of Operations

 

For the quarter ended October 31, 2012, we generated $ 12,000 in revenues from sub license fees received from Lumut.  The license fees received cover the period August to October.  An additional $ 4,000 was paid for November and is recorded as unearned revenue.  There can be no assurance that such payments will be made on a timely basis.     

 

For the quarter ended October 31, 2012, our expenses totaled $ 8,900 consisting primarily of audit and review fees of $ 4,000, and consulting fees for preparation of periodic reports for $ 4,000. We incurred $ 833 in amortization expenses on our license.  The license is amortized on a straight line basis over a 10 year period.

 

 

 

Off-Balance Sheet Arrangements

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.  

 

Contractual Obligations

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

11


 
 

 

 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

Item 4.  Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules, regulations and related forms, and that such information is accumulated and communicated to our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

As of October 31, 2012, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and our principal financial officer of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report. 

 

Changes in Internal Controls

 

There have been no changes in our internal controls over financial reporting during the quarter ended October 31, 2012 that have materially affected or are reasonably likely to materially affect our internal controls.

 

 

PART II — OTHER INFORMATION

 

Item 1.  Legal Proceedings.

 

There are presently no material pending legal proceedings to which the Company, any of its subsidiaries, any executive officer, any owner of record or beneficially of more than five percent of any class of voting securities is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

 

Item 1A.  Risk Factors.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

 

None.

 

Item 3.  Defaults Upon Senior Securities.

 

None.

 

Item 4.  Removed and Reserved.

 

 

Item 5.  Other Information.

 

None.

 

12


 
 

 

 

Item 6.  Exhibits.

 

(a)  Exhibits required by Item 601 of Regulation S-K.

 

 

Exhibit No.   

Description

 

 

   *3.1

Certificate of Incorporation, as filed with the Nevada Secretary of State on March 11, 2011.

 

 

   *3.2

By-laws.

 

 

    31.1

Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 2012.

 

 

    32.1

Certification of the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 

 

 

 

 

     101

Financial statements from the quarterly report on Form 10-Q of the Company for the quarter ended September 30, 2012, formatted in Extensible Business Reporting Language (XBRL): (i) the Statements of Operations, (ii) the Balance Sheets, (iii) the Statements of Cash Flows (iv) the Statement of Shareholders’ Equity and (v) the Notes to Financial Statements.

 

*

Filed as an exhibit to the Company's Registration Statement on Form 10, as filed with the SEC on September 30, 2011, and incorporated herein by this reference.

 

13


 
 

 

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

XTRALINK CORP.

 

 

 

Dated: December 12, 2012

By:

/s/ Maurice Sale

 

 

Maurice Sale

 

 

President and Director

Principal Executive Officer

Principal Financial Officer

 

 

 

 

14