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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended November 30, 2004
[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _________
Commission File Number: 0-19945
NoFire Technologies, Inc.
-------------------------
(Name of small business issuer in its charter)
Delaware 22-3218682
--------- -----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
21 Industrial Avenue, Upper Saddle River, New Jersey 07458
-----------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (201) 818-1616
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Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 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
--- ---
Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by the Court.
YES X NO
--- ---
State the number of shares of each of the issuer's classes of common equity
outstanding at the latest practicable date: 34,298,407 shares of Common
Stock as of January 15,2004.
Transitional Small Business Disclosure Format (check one):
YES NO X
--- ---
Page 1
NOFIRE TECHNOLOGIES, INC.
FORM 10-QSB
INDEX
PART I - FINANCIAL INFORMATION PAGE
Item 1. Financial Statements:
Balance Sheets as of November 30, 2004(unaudited)
and August 31, 2004 3
Statements of Operations for the Three Months
ended November 30,2004 and 2003 (unaudited) 5
Statements of Cash Flows for the
Three Months ended November 30, 2004 and 2003.
(unaudited) 6
Notes to Unaudited Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 13
Item 3. Controls and Procedures 14
Part II - OTHER INFORMATION
Item 1. Legal 15
Item 6. Exhibits and Reports on Form 8-K 15
Signatures 15
Certification of Financial Information 16
Sarbanes-Oxley Act Section 906 Certification Exhibit 1
Page 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NOFIRE TECHNOLOGIES, INC.
BALANCE SHEETS
November 30, August 31,
2004 2004
----------- ----------
(UNAUDITED)
ASSETS
CURRENT ASSETS:
Cash $17,520 $ 33,706
Accounts receivable - trade 38,509 15,962
Inventories 83,312 86,113
Prepaid expenses and other current assets 64,254 12,294
Receivable for sale of tax loss
carry forward 49,928 -
--------- ----------
Total Current Assets 253,523 148,705
--------- ----------
EQUIPMENT, less accumulated depreciation 3,968 4,399
--------- ----------
OTHER ASSETS:
Patents, less accumulated amortization of
$1,529,275 at November 30, 2004 and
$1,528,023 at August 31, 2004 3,758 5,008
Security deposits 24,879 24,880
---------- ---------
28,637 29,888
---------- ---------
$ 286,128 $ 182,992
========== ==========
See accompanying notes to financial statements
Page 3
NOFIRE TECHNOLOGIES, INC.
BALANCE SHEETS
November 30, August 31,
2004 2004
----------- ----------
(UNAUDITED)
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIENCY)
CURRENT LIABILITIES:
Settled liabilities $1,153,426 $1,153,426
Accounts payable and accrued expenses 607,588 481,234
Loans and advances payable to
stockholders 130,421 29,071
Deferred salaries 507,360 504,195
Loans payable 250,173 250,173
Convertible Debentures 8% 427,108 482,208
---------- ---------
Total Current Liabilities 3,076,076 2,900,307
---------- ---------
LONG TERM LIABILITY
Convertible Debenture 8% 326,894 1,610,294
STOCKHOLDERS' EQUITY (DEFICIENCY):
Common stock $.20 par value:
Authorized - 50,000,000 shares
Issued and outstanding -32,026,466
shares at November 30, 2004 and 21,744,019
shares at August 31, 2004 6,405,293 4,348,804
Capital in excess of par value 6,234,531 6,774,313
Accumulated Deficit (15,756,666) (15,450,726)
---------- ----------
Total Stockholders' Equity (Deficiency) (3,116,842) (4,327,609)
---------- ----------
$ 286,128 $ 182,992
========== ==========
See accompanying notes to financial statements
Page 4
NOFIRE TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
For the Three Months
Ended November 30,
2004 2003
---------- ------
(UNAUDITED)
NET SALES $ 116,274 $ 73,443
---------- ----------
COSTS AND EXPENSES:
Cost of sales 68,298 30,683
General and administrative 287,061 299,266
---------- ----------
355,359 329,949
---------- ---------
LOSS FROM OPERATIONS (239,085) (256,506)
---------- ----------
OTHER EXPENSES:
Interest expense 116,862 159,640
Interest income (79) (75)
---------- ----------
116,783 159,565
---------- ----------
LOSS BEFORE INCOME TAXES (355,868) (416,071)
DEFERRED INCOME TAX BENEFIT 49,928 43,290
---------- ----------
NET LOSS $ (305,940) $(372,781)
========== ==========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 26,645,492 20,939,019
========== ==========
BASIC AND DILUTED EARNINGS LOSS
PER COMMON SHARE $ (0.01) $ (0.02)
========== ==========
See accompanying notes to financial statements
Page 5
NOFIRE TECHNOLOGIES, INC.
STATEMENTS OF CASH FLOWS
For the Three Months
Ended November 30,
2004 2003
--------- ---------
(UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (305,940) (372,781)
Adjustments to reconcile net loss to
net cash flows from operating activities:
Depreciation and amortization 1,683 2,233
Amortization of interest expense for
discount on convertible debentures 138,000
Repricing of warrants 10,100 -
Warrants issued with debt conversion 86,808
Changes in operating assets and liabilities
Inventory 2,800
Accounts receivable - trade (22,547) 23,028
Prepaid expenses and other (51,330) (73)
Receivable for sale of state
tax loss (49,928) ( 43,290)
Accounts payable and accrued expenses 113,101 (106,011)
Security deposits (5,500)
Deferred salaries 99,265 13,658
---------- ---------
Net cash flows from operating activities (115,988) (393,236)
---------- ---------
See accompanying notes to financial statements
Page 6
NOFIRE TECHNOLOGIES, INC.
STATEMENTS OF CASH FLOWS
For the Three Months
Ended November 30,
2004 2003
--------- ---------
(UNAUDITED)
Proceeds from issuance of common stock,
net of related expenses 40,000
Payments on advances from stockholders (10,500) (6,500)
Loans and advances from stockholders 21,550 -
Interest accrued on loans from
stockholders 18,753 -
Proceeds from issuance of convertible
debentures 30,000 230,000
---------- ----------
Net cash flows from financing activities 99,803 223,500
---------- ----------
NET CHANGE IN CASH (16,185) (169,736)
CASH AT BEGINNING OF PERIOD 33,706 197,161
---------- ----------
CASH AT END OF PERIOD $ 17,521 $ 27,425
========== ==========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ 663 $ 1,154
========== ==========
Common stock issued in exchange
for debt $1,381,800 $ -
========== ==========
See accompanying notes to financial statements
Page 7
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
NOTE 1 - Basis of Presentation:
The balance sheet at the end of the preceding fiscal year has been derived
from the audited balance sheet contained in the Company's Form 10-KSB for the
year ended August 31, 2004 (the "10-KSB") and is presented for comparative
purposes. All other financial statements are unaudited. In the opinion of
management, all adjustments which include only normal recurring adjustments
necessary to present fairly the financial position, results of operations and
cash flows for all periods presented have been made. The results of
operations for interim periods are not necessarily indicative of the operating
results for the full year.
Footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States
of America have been omitted in accordance with the published rules and
regulations of the Securities and Exchange Commission. These financial
statements should be read in conjunction with the financial statements and
notes thereto included in the 10-KSB for the most recent fiscal year.
NOTE 2 - Reorganization:
The Company owned 89% of the outstanding common stock of both No Fire Ceramic
Products, Inc. and No Fire Engineering, Inc. together with an option to
acquire the remaining 11% of such stock. Both of those subsidiaries were
dissolved during the fiscal year ended August 31, 1997.
Under a Chapter 11 proceeding, the Bankruptcy Court confirmed a Plan of
Reorganization for the Company which became effective on August 11, 1995.
Claims of creditors, to the extent allowed under the Plan, were required to be
paid over a four-year period.
NOTE 3- SUMMARY OF SIGNIFICANT ACCOUNTING POLOCIES:
Loss per Share - Loss per share is based on the weighted average number of
shares outstanding during the periods. The effect of warrants outstanding
is not included since it would be anti-dilutive.
Equity Based Compensation- The Company follows the intrinsic value method
of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees" (APB 25) and related interpretations in accounting for its employee
stock options because, in the opinion of management, Financial Accounting
Standards Board Statement No. 123, Accounting for Stock-Based Compensation
"(FAS 123) requires use of option valuation models that were not developed
for use in valuing employee stock options. FAS 123 permits a company to elect
to follow the intrinsic value method of APB 25 rather than the alternative
fair value accounting provided under FAS 123, but requires pro forma net
income (loss) and earnings (loss) per share disclosures as well as various
other disclosures. The Company has adopted the disclosure provisions required
under Financial Accounting Standards Board Statement No. 148, "Accounting for
Stock-Based Compensation Transition and Disclosure " (FAS 148).
Page 8
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
If the recognition provisions of SFAS 123 using the Black-Scholes
option pricing model were applied, the resulting pro-forma net income (loss)
available to common shareholders and pro-forma net income (loss) available
to common shareholders per share would be as follows:
For the Three months ended
November 30,
2004 2003
Net loss available to common
Shareholders, as reported $ (305,940) $(372,781)
Deduct: Stock-based compensation
Net of tax 6,000 -
Net loss available to common
Shareholders, pro-forma $ (311,940) $(372,781)
Basic earnings per share:
As reported $ (.01) $ (.02)
Pro-forma $ (.01) $ (.02)
The above stock-based employee compensation expense has been determined
utilizing a fair value method, the Black-Scholes option-pricing model.
The Company has recorded no compensation expense for stock options and warrants
granted to employees during the three months ended November 30, 2004 and 2003.
In accordance with SFAS 123, the fair value of each option grant has been
estimated as of the date of the grant using the Black-Scholes option pricing
model with the following weighted average assumptions:
For the Three months ended November 30,
2004 2003
Risk free interest rate 4.0% 0
Expected life 8.5 years n/a
Dividend rate 0.00% 0.00%
Expected volatility 18% n/a
New Accounting Pronouncements -
FASB 151 - Inventory Costs
In November 2004, the FASB issued FASB Statement No. 151, which revised
ARB No.43,relating to inventory costs. This revision is to clarify the
accounting for abnormal amounts of idle facility expense, freight,
handling costs and wasted material (spoilage). This Statement requires
that these items be recognized as a current period charge regardless of
whether they meet the criterion specified in ARB 43. In addition, this
Statement requires the allocation of fixed production overheads to the
costs of conversion be based on normal capacity of the production
facilities. This Statement is effective for financial statements for
fiscal years beginning after June 15, 2005. Earlier application is
permitted for inventory costs incurred during fiscal years beginning
after the date of this Statement is issued. Management believes this
Page 9
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
Statement will have no impact on the financial statements of the
Company once adopted.
FASB 152 - Accounting for Real Estate Time-Sharing Transactions
In December 2004, the FASB issued FASB Statement No. 152, which amends
FASB Statement No. 66, Accounting for Sales of Real Estate, to
reference the financial accounting and reporting guidance for real
estate time-sharing transactions that is provided in AICPA Statement of
Position (SOP) 04-2, Accounting for Real Estate Time-Sharing
Transactions. This Statement also amends FASB Statement No. 67,
Accounting for Costs and Initial Rental Operations of Real Estate
Projects, to state that the guidance for (a) incidental operations and
(b) costs incurred to sell real estate projects does not apply to real-
estate time-sharing transactions. The accounting for those operations
and costs is subject to the guidance in SOP 04-2. This Statement is
effective for financial statements for fiscal years beginning after
June 15, 2005. Management believes this Statement will have no impact
on the financial statements of the Company once adopted.
FASB 153 - Exchanges of Nonmonetary Assets
In December 2004, the FASB issued FASB Statement No. 153. This
Statement addresses the measurement of exchanges of nonmonetary assets.
The guidance in APB Opinion No. 29, Accounting for Nonmonetary
Transactions, is based on the principle that exchanges of nonmonetary
assets should be measured based on the fair value of the assets
exchanged. The guidance in that Opinion, however, included certain
exceptions to that principle. This Statement amends Opinion 29 to
eliminate the exception for nonmonetary exchanges of similar
productive assets and replaces it with a general exception for
exchanges of nonmonetary assets that do not have commercial substance.
A nonmonetary exchange has commercial substance if the future cash
flows of the entity are expected to change significantly as a result of
the exchange. This Statement is effective for financial statements for
fiscal years beginning after June 15, 2005. Earlier application is
permitted for nonmonetary asset exchanges incurred during fiscal years
beginning after the date of this Statement is issued. Management
believes this Statement will have no impact on the financial statements
of the Company once adopted.
FASB 123 (revised 2004) - Share-Based Payments
In December 2004, the FASB issued a revision to FASB Statement No. 123,
Accounting for Stock Based Compensation. This Statement supercedes APB
Opinion No. 25, Accounting for Stock Issued to Employees, and its
related implementation guidance. This Statement establishes standards
for the accounting for transactions in which an entity exchanges its
equity instruments for goods or services. It also addresses
transactions in which an entity incurs liabilities in exchange for
goods or services that are based on the fair value of the entity's
equity instruments or that may be settled by the issuance of those
equity instruments. This Statement focuses primarily on accounting for
transactions in which an entity obtains employee services in share-
based payment transactions. This Statement does not change the
accounting guidance for share-based payment transactions with parties
other than employees provided in Statement 123 as originally issued and
Page 10
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
EITF Issue No. 96-18, "Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring, or in Conjunction with
Selling, Goods or Services." This Statement does not address the
accounting for employee share ownership plans, which are subject to
AICPA Statement of Position 93-6, Employers' Accounting for Employee
Stock Ownership Plans.
A nonpublic entity will measure the cost of employee services received
in exchange for an award of equity instruments based on the grant-date
fair value of those instruments, except in certain circumstances.
A public entity will initially measure the cost of employee services
received in exchange for an award of liability instruments based on its
current fair value; the fair value of that award will be re-measured
subsequently at each reporting date through the settlement date.
Changes in fair value during the requisite service period will be
recognized as compensation cost over that period. A nonpublic entity
may elect to measure its liability awards at their intrinsic value
through the date of settlement.
The grant-date fair value of employee share options and similar
instruments will be estimated using the option-pricing models adjusted
for the unique characteristics of those instruments (unless observable
market prices for the same or similar instruments are available).
Excess tax benefits, as defined by this Statement, will be recognized
as an addition to paid-in-capital. Cash retained as a result of those
excess tax benefits will be presented in the statement of cash flows as
financing cash inflows. The write-off of deferred tax assets relating
to unrealized tax benefits associated with recognized compensation cost
will be recognized as income tax expense unless there are excess tax
benefits from previous awards remaining in paid-in capital to which it
can be offset.
The notes to the financial statements of both public and nonpublic
entities will disclose information to assist users of financial
information to understand the nature of share-based payment
transactions and the effects of those transactions on the financial
statements.
The effective date for public entities that do not file as small
business issuers will be as of the beginning of the first interim or
annual reporting period that begins after June 15, 2005. For public
entities that file as small business issuers and nonpublic entities the
effective date will be as of the beginning of the first interim or
annual reporting period that begins after December 15, 2005. Management
intends to comply with this Statement at the scheduled effective date
for the relevant financial statements of the Company.
NOTE 4 - Management's Actions to Overcome Operating and Liquidity
Problems:
The Company's financial statements have been presented on the going concern
basis which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. The Company's viability as a
going concern is dependent upon its ability to achieve profitable operations
through increased sales and/or obtaining additional financing. Without
achieving these, there is substantial doubt about the Company's ability to
continue as a going concern.
Page 11
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
The Company has a liability for settled claims payable to creditors in
connection with its reorganization under the Plan. Without the achievement
of profitable operations or additional financing, funds for repayment would
not be available.
Management believes that successful passing of stringent tests, obtaining
various civil and government approvals, and actions it has undertaken to
revise the Company's operating and marketing structure should provide it
with the opportunity to generate revenues needed to realize profitable
operations and to attract the necessary financing and/or capital for the
payment of outstanding obligations.
NOTE 5 - CONVERTIBLE DEBENTURES:
On August 30, 2004 the company entered into conversion of debt
agreement whereby officers and directors of the company agreed to convert
certain debt into an 8% convertible debenture. The debenture allows for a
conversion at the rate of $0.14 per share of common stock.
On November 30, 2004 $ 1,283,400 of the above debenture was converted
into common stock. The balance of $326,894 was converted in December
(see subsequent events.)
In addition warrants were issued at the rate of 3 times the number of
shares. These warrants cannot be exercised until such time as the company
increases the authorized number of common stock shares.
During the quarter two accredited investors converted $85,000 of their
Convertible debentures into 659,003 shares of the company's common stock.
On August 30,2004 the officers and directors returned 8,305,460
previously Issued warrants as part of the transaction.
During the quarter ended November 30, 2004 no warrants expired
On November 30, 2004 the Company issued to two accredited investors
285,714 shares of the company's common stock for $40,000. In addition
the company issued 857,145 $0.14 ten-year warrants to purchase the
company's common stock. The warrants vested immediately.
Note 6- STOCK-BASED COMPENSATION
The Company follows the intrinsic value method of Accounting Principles
Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB 25) and
related interpretations in accounting for its employee stock options because,
in the opinion of management, Financial Accounting Standards Board Statement
No. 123, Accounting for Stock-Based Compensation" (FAS 123) requires use of
option valuation models that were not developed for use in valuing employee
stock options. FAS 123 permits a company to elect to follow the intrinsic
value method of APB 25 rather than the alternative fair value accounting
provided under FAS 123, but requires pro forma net income (loss) and earnings
(loss) per share disclosures as well as various other disclosures. The
Company has adopted the disclosure provisions required under Financial
Accounting standards Board Statement No. 148, "Accounting for Stock-Based
Compensation Transition and Disclosure " (FAS 148).
During the 3 months ended November 30,2004 200,000 warrants were issued to
four employees. The warrants are convertible into the company's common stock
at $0.14 per share and expire in five years. The warrants vested immediately.
There was no stock based compensation issued in the quarter ended November 2003
Page 12
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
NOTE 7- SUBSEQUENT EVENTS
In December 2004 the company received $49,928 in payment on the sale of
the company's New Jersey Carry Forward Loss for 2004. In addition $29,859 was
used to retire the remaining loan which was collaterized by the receivable.
In December 2004 the balance of the Convertible Debenture totaling $326,894
Was converted into the company's common stock at $0.14 per share.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
The Company continued its product development and application testing, and now
has numerous certifications for specific applications. Since August 1995, the
Company has applied for eight patents, five of which have been issued. The
other three are pending. Additionally, one patent has been purchased by the
Company. The Company has been increasing its marketing efforts
principally by retaining the services of specialized distribution firms. The
Company's management believes that marketing efforts to date have brought the
Company closer to achieving greater sales for applications in many diverse
industries including: military, maritime, wood products, structural steel and
nuclear power plants. Significant tests have been passed and approvals
received to qualify the Company's products in naval and other military and
governmental applications. Aggressive marketing efforts are underway to
obtain orders in these applications. Obstacles encountered in obtaining
orders for most applications are the continuing tests and approvals required,
competition against well established and better capitalized companies, cost,
the slow process of specifying new products in highly regulated industrial
applications, and the decisions not to use any fire retardant product.
In general, the Company's products perform their intended uses well and are
in a form that is safe and easy to use. The Company's most pressing need
continues to be cash infusion as discussed below in the section on Liquidity
and Capital Resources. The Company is limiting its research and development
efforts in order to concentrate on sales of existing products. While new
market opportunities frequently arise, the Company has opted to concentrate
on targeting sales of present products rather than developing new products.
Efforts to establish additional U.S. distributors are being accelerated.
Additional efforts are also being directed to increase international sales
by establishing distributor relationships in strategic locations throughout
the industrialized world.
The number of manufacturing and quality control employees will increase with
increased production. The salaried administrative and marketing staff will be
evaluated and may be increased to support sales and marketing initiatives.
Additional support for direct sales is expected to be provided by independent
commission agents or employees compensated principally by commission.
Page 13
NOFIRE TECHNOLOGIES, INC.
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)
November 30, 2004
COMPARISON THREE MONTHS ENDED NOVEMBER 30, 2004 AND NOVEMBER 30, 2003
Sales of $116,274 for the three months ended November 30, 2004 represented an
increase of 58.3% from the $73,443 for the comparable three-month period of the
prior year. Cost of goods sold during the same periods increased from
$30,683 to $68,298 resulting in a gross profit of $47,976 compared to $42,760
in the prior year. Selling, general and administrative expenses for the three
months ended November 30, 2004 was $287,061, representing a decrease of
$12,205 or 4.25% from the $299,266 of the similar period of the prior year.
During the quarters ended November 30, 2004 and 2003 the Company realized
approximately $50,000 and $43,000, respectively, through the sale of a
portion of its New Jersey Net Operating Loss Carry Forward under a program
sponsored by that state.
LIQUIDITY AND CAPITAL RESOURCES
At November 30, 2004 the Company had cash balances of $ 17,520. In order to
fund continuing operations during the three months ended on that date,
the Company issued to two accredited investors 285,714 shares of the
company's common stock for $40,000. In addition the company issued
857,145 $0.14 five-year warrants to purchase the company's common stock.
The Company has deferred payment of $1,153,426 of the installments of the
Chapter 11 liability to unsecured creditors that were due in September 1996,
1997, 1998 and 1999. Of that deferred amount, $775,394 is due to officers and
directors of the Company. In order to pay those liabilities and meet working
capital needs until significant sales levels are achieved, the Company will
continue to explore alternative sources of funding including exercise of
warrants, bank and other borrowings, issuance of convertible debentures,
issuance of common stock to settle debt, and the sale of equity securities in
a public or private offering. There is no assurance that the Company will be
successful in securing requisite financing.
Item 8A. CONTROLS AND PROCEDURES
Our management, including the Chief Executive Officer and Chief Financial
Officer, have conducted an evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures pursuant to Rule 13a-15
under the Securities Exchange Act of 1934, as amended, (the "1934 Act"), as of
the end of the period covered by this Annual Report on Form 10-KSB. Based on
that evaluation, our Chief Executive Officer and Chief Financial Officer
concluded that our disclosure controls and procedures are effective in ensuring
that information required to be disclosed by us in the reports we file or
submit under the 1934 Act is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules and forms.
There have been no changes in internal control over financial
reporting that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting during
the period covered by this report.
Page 14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibit 1- Sarbanes-Oxley Act Section 906 Certification
On November 3,2004 an 8K was filed under section 5.01 (Changes in control of
Registrant) (See Note 5 Convertible Debentures above)
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: January 18,2005 NoFire Technologies, Inc.
By: /s/ Samuel Gottfried
Sam Gottfried
Chief Executive Officer
By: /s/ Sam Oolie
Sam Oolie
Chairman of the Board,
Chief Financial Officer
Page 15
I, Sam Oolie, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of
NoFire Technologies, Inc.;
2. Based on my knowledge, this quarterly report does not
contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements
made, in light of the circumstances under which such
statements were made, not misleading with respect to the
period covered by this annual report;
3. Based on my knowledge, the financial statements, and
other financial information included in this quarterly
report, fairly present in all material respects the
financial condition, results of operations and cash flows
of
the registrant as of, and for, the periods presented in
this annual report;
4. The registrant's other certifying officer and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to
ensure that material information relating to the
registrant, including its consolidated subsidiaries, is
made known to us by others within those entities,
particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date within 90
days prior to the filing date of this quarterly report (the
"Evaluation Date"); and
c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation
Date.
5. The registrant's other certifying officer and I have
disclosed, based on our most recent evaluation, to the
registrant's board of directors (or persons performing the
equivalent functions):
Page 16
a) all significant deficiencies in the design or
operation of internal controls which could adversely affect
the registrant's ability to record, process, summarize and
report financial data and have identified auditors any
material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant role
in the registrant's internal controls; and
6. The registrant's other certifying officer and I
indicated in this quarterly report that there were no
significant changes in internal controls or in other
factors that could significantly affect internal control
subsequent to the date of our most recent evaluation,
including any
corrective actions with regard to significant deficiencies
and material weaknesses.
Date: January 18, 2005 /s/Sam Oolie
-------------
- --------------
Sam Oolie,
Chief Financial Officer
Page 17
I, Samuel Gottfried certify that:
1. I have reviewed this quarterly report on Form 10-QSB of
NoFire Technologies, Inc.;
2. Based on my knowledge, this quarterly report does not
contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements
made, in light of the circumstances under which such
statements were made, not misleading with respect to the
period covered by
this annual report;
3. Based on my knowledge, the financial statements, and
other financial information included in this quarterly
report, fairly present in all material respects the
financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in
this quarterly report;
4. The registrant's other certifying officer and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to
ensure that material information relating to the
registrant, including its consolidated subsidiaries, is
made known to us by others within those entities,
particularly during the period in which this annual report
is being prepared;
b) evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date within 90
days prior to the filing date of this quarterly report (the
"Evaluation Date"); and
c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation
Date.
5. The registrant's other certifying officer and I have
disclosed, based on our most recent evaluation, to the
registrant's board of directors (or persons performing the
equivalent functions):
Page 18
a) all significant deficiencies in the design or
operation of internal controls which could adversely affect
the registrant's ability to record, process, summarize and
report financial data and have identified for the
registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant role
in the registrant's internal controls; and
6. The registrant's other certifying officer and I have
indicated in this annual report whether there were
significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies
and material weaknesses.
Date: January 18,2005 /s/ SamuelGottfried
---------------------
Samuel Gottfried
--------------------
Chief Executive Officer
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CERTIFICATION
Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and
(b) of section 1350, chapter 63 of title 18, United States Code), each of the
undersigned officers of NoFire Technologies, Inc., a Delaware corporation (the
company), does hereby certify, to the best of such officer's knowledge and
belief, that:
The Quarterly Report on Form 10-QSB for the Quarter ended November 30,
2004 of the Company fully complies with the requirements of section 13
(a) or 15 (d) of the Securities Exchange Act of 1934: and
The information contained in the Form 10-QSB fairly presents in all
material respects, the financial condition and results of operations of
the Company.
Dated: January 18, 2005 /s/ Samuel Gottfried
-------------------
Chief Executive Officer
Dated: January 18, 2005 /s/ Sam Oolie
-----------------------
Chief Financial Officer
EXHIBIT 1