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EX-31.2 - Global Cooling Technologies Corp. | v166492_ex31-2.htm |
EX-31.1 - Global Cooling Technologies Corp. | v166492_ex31-1.htm |
EX-32.1 - Global Cooling Technologies Corp. | v166492_ex32-1.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
(MARK
ONE)
x QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT
OF 1934
For the
quarterly period ended September 30, 2009
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 No. 333-160366
GLOBAL
COOLING TECHNOLOGIES CORP.
(Exact
name of registrant as specified in its charter)
Nevada
|
None
|
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
|
incorporation
or organization)
|
Identification
No.)
|
112
North Curry Street
Carson
City, Nevada 89703
(Address
of principal executive offices, zip code)
(702)
967-0698
(Registrant’s
telephone number, including area code)
(Former
name, former address and former fiscal year,
if
changed since last report)
Check
whether the issuer (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 is a shell company (as defined in Exchange
Act Rule 12b-2 of the Exchange Act): Yes x No
¨
APPLICABLE
ONLY TO CORPORATE ISSUERS
As of November 16, 2009,
there were 209,999 shares of common stock, $0.00001 par value per share,
outstanding, 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. (check one):
Large
accelerated filer ¨ Accelerated
filer ¨ Non-accelerated
filer ¨ Smaller
reporting company x
(Do not
check if a smaller reporting company)
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
QUARTERLY
REPORT ON FORM 10-Q
FOR
THE PERIOD ENDED SEPTEMBER 30, 2009
INDEX
Index
|
Page
|
||
Part
I.
|
Financial
Information
|
||
Item
1.
|
Financial Statements
|
||
Condensed
Balance Sheets as of September 30, 2009 (unaudited) and June 30,
2009.
|
4
|
||
Condensed
Statements of Operations for the Three Months ended September 30, 2009 and
2008 (unaudited).
|
5
|
||
Condensed
Statements of Changes in Stockholders Equity for the Three Months ended
September 30, 2009 (unaudited) and Year ended June 30,
2009.
|
6
|
||
Condensed
Statements of Cash Flows for the Three Months ended September 30, 2009 and
2008 (unaudited).
|
7
|
||
Notes
to Condensed Financial Statements (unaudited).
|
8
|
||
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations.
|
10
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk.
|
16
|
|
Item
4.
|
Controls
and Procedures.
|
16
|
|
Part
II.
|
Other
Information
|
||
Item
1.
|
Legal
Proceedings.
|
16
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|
Item 1A.
|
Risk
Factors
|
16
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds.
|
16
|
|
Item
3.
|
Defaults
Upon Senior Securities.
|
16
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders.
|
17
|
|
Item
5.
|
Other
Information.
|
17
|
|
Item
6.
|
Exhibits.
|
17
|
|
Signatures
|
18
|
||
Certifications
|
|
2
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
Quarterly Report on Form 10-Q of Global Cooling Technologies Corp., a Nevada
corporation (the “Company”), contains “forward-looking statements,” as defined
in the United States Private Securities Litigation Reform Act of
1995. In some cases, you can identify forward-looking statements by
terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”,
“intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or
“continue” or the negative of such terms and other comparable
terminology. These forward-looking statements include, without
limitation, statements about our market opportunity, our strategies,
competition, expected activities and expenditures as we pursue our business
plan, and the adequacy of our available cash resources. Although we
believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Actual results may differ materially from the
predictions discussed in these forward-looking statements. The
economic environment within which we operate could materially affect our actual
results. Additional factors that could materially affect these
forward-looking statements and/or predictions include, among other things: the
Company’s need for and ability to obtain additional financing, the volatility of
real estate prices, and the exercise of the control by David Rendina, the
Company’s President and Chief Executive Officer, and Chairman of the Board
of Directors, other factors over which we have little or no control; and other
factors discussed in the Company’s filings with the Securities and Exchange
Commission (“SEC”).
Our
management has included projections and estimates in this Form 10-Q, which are
based primarily on management’s experience in the industry, assessments of our
results of operations, discussions and negotiations with third parties and a
review of information filed by our competitors with the SEC or otherwise
publicly available. We caution readers not to place undue reliance on
any such forward-looking statements, which speak only as of the date
made. We disclaim any obligation subsequently to revise any
forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated
events.
3
PART
I. FINANCIAL INFORMATION
ITEM 1. CONDENSED
FINANCIAL STATEMENTS.
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Condensed
Balance Sheets
September 30,
|
June 30,
|
|||||||
2009
|
2009
|
|||||||
(unaudited)
|
||||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
|
$ | 4,440 | $ | 7,125 | ||||
Total
current assets
|
4,440 | 7,125 | ||||||
Total
assets
|
$ | 4,440 | $ | 7,125 | ||||
LIABILITIES
AND SHAREHOLDERS' EQUITY (DEFICIT)
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 785 | $ | - | ||||
Due
to related party
|
330 | 330 | ||||||
Convertible
note due to related party
|
15,620 | 15,153 | ||||||
Total
current liabilities
|
16,735 | 15,483 | ||||||
Total
Liabilities
|
16,735 | 15,483 | ||||||
Commitments
and Contingencies
|
||||||||
Shareholders'
equity (deficit):
|
||||||||
Preferred
stock: 25,000,000 shares authorized of $0.00001 par value; 0 issued and
outstanding as of September 30, 2009 and June 30, 2009
|
- | - | ||||||
Common
stock: 100,000,000 shares authorized of $0.00001 par value;
43,333 and 10,000 shares issued and outstanding as of September 30,2009
and June 30, 2009
|
- | - | ||||||
Additional
paid-in capital
|
3,333 | - | ||||||
Accumulated
deficit during development stage
|
(15,628 | ) | (8,358 | ) | ||||
Total
shareholders' equity (deficit)
|
(12,295 | ) | (8,358 | ) | ||||
Total
liabilities and shareholders' equity (deficit)
|
$ | 4,440 | $ | 7,125 |
The
accompanying notes are an integral part of these condensed financial
statements
4
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Condensed
Statements of Operations (Unaudited)
Three Months Ended
September 30,
|
Period from
July 3, 2008
(Inception) to
September
|
|||||||||||
2009
|
2008
|
30, 2009
|
||||||||||
General
and administrative expenses:
|
$ | $ | $ | |||||||||
Consulting
and professional fees
|
5,000 | 5,000 | 12,500 | |||||||||
Other
general & administrative expenses
|
1,803 | 330 | 2,508 | |||||||||
Total
general and administrative expenses
|
6,803 | 5,330 | 15,008 | |||||||||
Other
income (expenses)
|
||||||||||||
Interest
expense
|
(467 | ) | - | (620 | ) | |||||||
Total
other income (expenses)
|
(467 | ) | - | (620 | ) | |||||||
Net
loss
|
$ | (7,270 | ) | $ | (5,330 | ) | $ | (15,628 | ) | |||
Loss
per common share:
|
||||||||||||
Basic
and diluted
|
$ | (0.47 | ) | $ | (0.56 | ) | ||||||
Weighted
average common shares outstanding:
|
||||||||||||
Basic
and diluted
|
15,435 | 9,438 |
The
accompanying notes are an integral part of these condensed financial
statements
5
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Condensed
Statements of Changes in Stockholders' Equity (Deficit) (Unaudited)
Common
|
Additional
|
Accumulated
deficit
during
|
||||||||||||||||||
Common
|
stock
|
paid-in
|
Development
|
|||||||||||||||||
stock
|
amount
|
capital
|
stage
|
Total
|
||||||||||||||||
Balance,
July 3, 2008 (inception)
|
- | $ | - | $ | - | $ | - | $ | - | |||||||||||
Shares
issued for services July 8,
2008
|
10,000 | - | - | - | - | |||||||||||||||
Net
loss, June 30, 2009
|
- | - | - | (8,358 | ) | (8,358 | ) | |||||||||||||
Balance,
June 30, 2009
|
10,000 | (8,358 | ) | (8,358 | ) | |||||||||||||||
Shares
issued for cash
|
33,333 | - | 3,333 | - | 3,333 | |||||||||||||||
Net
loss, June 30, 2009
|
- | - | - | (7,270 | ) | (7,270 | ) | |||||||||||||
Balance,
September 30, 2009
|
43,333 | $ | - | $ | 3,333 | $ | (15,628 | ) | $ | (12,295 | ) |
The
accompanying notes are an integral part of these condensed financial
statements
6
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Condensed
Statements of Cash Flows (Unaudited)
Three Months Ended
September 30,
|
Period from
July 3, 2008
(Inception) to
September
|
|||||||||||
2009
|
2008
|
30, 2009
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
loss
|
$ | (7,270 | ) | $ | (5,330 | ) | $ | (15,628 | ) | |||
Adjustments
to reconcile net loss to net cash (used in) provided by operating
activities:
|
||||||||||||
Accrued
interest expense
|
467 | - | 620 | |||||||||
Changes
in operating assets and liabilities:
|
||||||||||||
Increase
in accounts payable
|
785 | - | 785 | |||||||||
Net
cash (used in) operating activities
|
(6,018 | ) | (5,330 | ) | (14,223 | ) | ||||||
Cash
flows from investing activities:
|
||||||||||||
Cash
flows from financing activities:
|
||||||||||||
Proceeds
from stock issuances
|
3,333 | - | 3,333 | |||||||||
Borrowings
from related party
|
- | 5,330 | 15,330 | |||||||||
Net
cash provided by financing activities
|
3,333 | 5,330 | 18,663 | |||||||||
Net
increase (decrease) in cash
|
(2,685 | ) | - | 4,440 | ||||||||
Cash,
beginning of the period
|
7,125 | - | - | |||||||||
Cash,
end of the period
|
$ | 4,440 | $ | - | $ | 4,440 |
Supplement
cash folw information and non cash financing activities
|
||||||||||||
Cash
paid for
|
||||||||||||
Interest
|
$ | - | $ | - | $ | - | ||||||
Income
tax
|
$ | - | $ | - | $ | - |
The
accompanying notes are an integral part of these condensed financial
statements
7
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Notes
to Condensed Financial Statements (Unaudited)
As
of September 30, 2009
1.
|
Condensed
financial statements
|
The
accompanying September 30, 2009 condensed financial statements have been
prepared by the Company without audit. 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 at
September 30, 2009 and 2008 and for all periods presented have been
made. Certain information and footnote disclosures normally included
in consolidated financial statements prepared in accordance with accounting
principles generally accepted in the United States of America have been
condensed or omitted. It is suggested that these condensed financial
statements be read in conjunction with the Company's June 30, 2009 audited
consolidated financial statements and related notes included in the Company’s
most recent Form S-1 as filed with the Securities and Exchange Commission (the
“SEC”). The results of operations for periods ended September 30,
2009 and 2008 are not necessarily indicative of the operating results for the
full years.
2.
|
Organization
|
Global
Cooling Technologies Corp. (the “Company”) was incorporated in the State of
Nevada on July 3, 2008 and established a fiscal year end of June
30. It is a development-stage Company.
3.
|
Convertible
note due to related party
|
As of
September 30, 2009, convertible note due to related party consist of the
following:
Issued date
|
Maturity
|
Conversion
price
|
Amount
|
Debt
discount
|
Accrued
interest
|
Net amount
|
||||||||||||||||||
Convertible
Note 1
|
May 29, 2009
|
On demand
|
$ | 0.10 | $ | 15,000 | $ | - | $ | 620 | $ | 15,620 |
Convertible
Note 1 for $15,000 was issued on May 29, 2009 to David Rendina, our Chairman,
President, Chief Executive Officer and Secretary and sole shareholder for cash
advanced to the Company. The note is due upon demand by the holder
and accrued interest monthly at Twelve Percent (12%) per annum. Mr.
Rendina, at his sole discretion, may elect, at any time, to convert all or a
portion of the debt together with accrued interest into shares of the Company’s
Common Stock at $0.10 per share. The beneficial conversion feature
was calculated to be zero at the time of issuance in accordance with FASB
Emerging Issue Task Force (“EITF”) No 00-27. In addition, Mr. Rendina
directly paid a $330 Company expense. The Company has accrued
interest of $620 at September 30, 2009.
4.
|
Related
party transaction
|
David
Rendina has served as President, Chief Executive Officer, and Secretary of our
company from July 3, 2008 (inception) to the current date. On July 8,
2008, the pursuant to a Stock Subscription Agreement Mr. Rendina agreed to act
as our President and Chief Executive Officer for a term of one year beginning
July 8, 2008, in exchange for 10,000 shares of the Company’s Common
Stock.
On
September 15, 2009, pursuant to a Stock Subscription Agreement Mr. Rendina
purchased 33,333 shares on the Company’s Common Stock registered under the
Company’s Form S-1 for a cash payment of $3,333.
As of
September 30, 2009, 100% of the Company’s Common Stock is held by Mr.
Rendina. Subsequently, in October (see Note 7) 166,667 shares of the
Company’s common Stock were issued to other individuals for cash consideration
reducing Mr. Rendina’s ownership to 20.6% of the then issued and outstanding
shares of common stock.
8
GLOBAL
COOLING TECHNOLOGIES CORP.
(A
Development Stage Company)
Notes
to Condensed Financial Statements (Unaudited)
As
of September 30, 2009
5.
|
Going
Concern
|
To date
the Company has no operations or revenues and consequently has incurred
recurring losses from operations. No revenues are anticipated until
we complete the financing from our Form S-1 registration statement filed with
the SEC and effective on September 8, 2009 (the “Form S-1 Registration
Statement”) and implement our initial business plan. The ability of
the Company to continue as a going concern is dependent on raising capital to
fund our business plan and ultimately to attain profitable
operations. Accordingly, these factors raise substantial doubt as to
the Company’s ability to continue as a going concern.
The
Company has funded its initial operations by way of loans from Mr. Rendina its
President, Chief Executive Officer, Secretary, and Chairman of the Board of
Directors. Mr. Rendina has verbally committed to advancing certain
operating costs of the Company if no other proceeds are obtained by the
Company. However, there is no contract in place or written agreement
securing this understanding with Mr. Rendina.
The
Company plans to raise additional funds through debt or equity
offerings. The current plan includes the sale of 1,000,000 shares at
$0.10 per share based on the Company’s Form S-1 Registration
Statement.
There is
no guarantee that the Company will be able to raise any capital through this or
any other offerings.
6.
|
Stock
Issuances
|
On
September 15, 2009, pursuant to the terms of a stock subscription agreement, the
Company issued to David Rendina, our President, Chief Executive Officer,
Secretary, and Chairman of the Board of Directors, 33,333 shares of the
Company’s Common Stock at $0.10 per shares for cash consideration of
$3,333. The shares were pursuant to the Company’s Form S-1
Registration Statement.
7.
|
Subsequent
events
|
On
October 7, 2009, pursuant to the terms of two stock subscription agreements, the
Company issued to James and Victoria Bickel 33,333 shares and Jeffrey E Bickel
33,333 shares of the Company’s Common Stock at $0.10 per shares for cash
consideration aggregating $6,667. The shares were pursuant to the
Company’s Form S-1 Registration Statement.
On
October 19, 2009, pursuant to the terms of a stock subscription agreement, the
Company issued to the Villanueva Living Trust 100,000 restricted shares of the
Company’s Common Stock at $0.10 per share for cash consideration of
$10,000. The shares were pursuant to the Company’s Form S-1
Registration Statement.
9
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The
following information should be read in conjunction with (i) the condensed
consolidated financial statements of Global Cooling Technologies Corp., (A
Development Stage Company) and the notes thereto appearing elsewhere in this
Form 10-Q together with (ii) the more detailed business information and the June
30, 2009 audited financial statements and related notes included in the
Company’s most recent Form S-1 as filed with the Securities and Exchange
Commission. Statements in this section and elsewhere in this Form
10-Q that are not statements of historical or current fact constitute
“forward-looking” statements
OVERVIEW
Global
Cooling Technologies Corp. (“Company”) was incorporated in the State of Nevada
on July 3, 2008 and established a fiscal year end of June 30. It is a
development-stage Company.
Going
Concern
To date
the Company has no operations or revenues and consequently has incurred
recurring losses from operations. No revenues are anticipated until
we complete the financing from our Form S-1 registration statement filed with
the SEC and effective on September 8, 2009 (the “Form S-1 Registration
Statement”) and implement our initial business plan. The ability of
the Company to continue as a going concern is dependent on raising capital to
fund our business plan and ultimately to attain profitable
operations. Accordingly, these factors raise substantial doubt as to
the Company’s ability to continue as a going concern.
The
Company has funded its initial operations by way of loans from Mr. Rendina its
President, Chief Executive Officer, Secretary, and Chairman of the Board of
Directors. Mr. Rendina has verbally committed to advancing certain
operating costs of the Company if no other proceeds are obtained by the
Company. However, there is no contract in place or written agreement
securing this understanding with Mr. Rendina.
The
Company plans to raise additional funds through debt or equity
offerings. The current plan includes the sale of 1,000,000 shares at
$0.10 per share based on the Company’s Form S-1 Registration
Statement.
There is
no guarantee that the Company will be able to raise any capital through this or
any other offerings.
CRITICAL
ACCOUNTING POLICIES
The
discussion and analysis of our financial condition and results of operations are
based on our condensed consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States (“US GAAP”). The preparation of these condensed
consolidated financial statements requires us to make estimates and judgments
that affect the reported amounts of assets, liabilities, revenues and expenses,
and related disclosure of contingent assets and liabilities. On an
ongoing basis, we evaluate our estimates based on historical experience and on
various other assumptions that are believed to be reasonable under the
circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these estimates under
different assumptions or conditions. We have identified the policies
below as critical to our business operations and to the understanding of our
financial results:
Basis of
Presentation
The
Company reports revenues and expenses using the accrual method of accounting in
accordance with accounting principles generally accepted in the United States
(“US GAAP”) for financial and tax reporting purposes.
Cash and Cash
Equivalent
The
Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.
10
Fair Value of Financial
Instruments
SFAS No.
107, “Disclosures about Fair Value of Financial Instruments”, requires
disclosure of fair value information about financial instruments when it is
practicable to estimate that value. The carrying amounts of the
Company’s financial instruments as of September 30, and June 30, 2009
approximate their respective fair values because of the short-term nature of
these instruments. Such instruments consist of cash, accounts
receivable, accounts payable, due to related parties, short-term convertible and
term debt, and accrued and other liabilities.
Foreign Currency
Translation
The
financial statements are presented in United States dollars. In
accordance with SFAS No. 52, "Foreign Currency Translation", foreign denominated
monetary assets and liabilities are translated to their United States dollar
equivalents using foreign exchange rates which prevailed at the balance sheet
date. Non-monetary assets and liabilities are translated at exchange
rates prevailing at the transaction date. Revenue and expenses are
translated at average rates of exchange during the periods
presented. Related translation adjustments are reported as a separate
component of stockholders’ equity (deficit), whereas gains or losses resulting
from foreign currency transactions are included in results of
operations.
Convertible
Debt
In
accordance with the provisions of EITF No. 98-5 “Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjustable
Conversion Ratios” and EITF No. 00-27 “Application of Issue No. 98-5 to Certain
Convertible Instruments” (“EITF 00-27”) the Company evaluates debt securities
(“Debt”) for beneficial conversion features. A beneficial conversion
feature is present when the conversion price per share is less than the market
value of the common stock at the commitment date. The intrinsic value
of the feature is then measured as the difference between the conversion price
and the market value (the “Spread”) multiplied by the number of shares into
which the Debt is convertible and is recorded as debt discount with an
offsetting amount increasing additional paid-in-capital. The debt
discount is accreted to interest expense over the term of the Debt with any
unamortized discount recognized as interest expense upon conversion of the
Debt. If a debt security contains terms that change upon the
occurrence of a future event the incremental intrinsic value is measured as the
additional number of issuable shares multiplied by the commitment date market
value and is recognized as additional debt discount with an offsetting amount
increasing additional paid-in-capital upon the future event
occurrence. The total intrinsic value of the feature is limited to
the proceeds allocated to the Debt instrument.
Income
Taxes
The
Company follows the liability method of accounting for income taxes in
accordance with Statements of Financial Accounting Standards (“SFAS”) No.109,
“Accounting for Income Taxes” and clarified by FIN 48 “Accounting for
Uncertainty in Income Taxes – an interpretation of FASB Statement No.
109.” Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax balances. Deferred tax assets and liabilities
are measured using enacted or substantially enacted tax rates expected to apply
to the taxable income in the years in which those differences are expected to be
recovered or settled. Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is more likely than not that
some portion or all of the deferred tax assets will not be
realized. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the date
of enactment or substantive enactment.
Uncertain Tax
Positions
FASB
Interpretation No. 48, “Accounting for Uncertainty in Income Taxes, an
interpretation of FASB Statements No. 109” (“FIN 48”). FIN 48
addresses the determination of whether tax benefits claimed or expected to be
claimed on a tax return should be recorded in the financial
statements. FIN 48 clarifies the accounting for uncertainty in income
taxes by prescribing a two-step method of first evaluating whether a tax
position has met a more-likely-than-not recognition threshold and second,
measuring that tax position to determine the amount of benefit to be recognized
in the financial statements. FIN 48 provides guidance on the
presentation of such positions within a classified statement of financial
position as well as on derecognition, interest and penalties, accounting in
interim periods, disclosure, and transition. FIN 48 was effective in
the Company’s fiscal year ended June 30, 2008 and did not have a material effect
on the Company's consolidated financial statements.
11
Use of
Estimates
Preparation
of the financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and
assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those
estimates.
Stock-Based
Compensation
The
Company has not adopted a stock option plan and has not granted any stock
options. Accordingly no stock-based compensation has been recorded to
date.
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued
SFAS No. 123R, “Share Based Payment.” This statement is a
revision to SFAS 123 and supersedes Accounting Principles Board
(APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and
amends FASB Statement No. 95, “Statement of Cash Flows.” This
statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This
statement also provides guidance on valuing and expensing these awards, as well
as disclosure requirements of these equity arrangements. The Company
adopted SFAS No. 123R upon creation of the company and expenses share based
costs in the period incurred.
Basic and Diluted Net Loss
Per Share
Basic
loss per share includes no dilution and is computed by dividing loss available
to common stockholders by the weighted average number of common shares
outstanding for the period. Dilutive loss per share reflects the
potential dilution of securities that could share in the losses of the
Company.
Because
the Company does not have any potentially dilutive securities, the accompanying
presentation is only of basic loss per share.
RESULTS
OF OPERATIONS
Three
months ended September 30, 2009 compared to three months ended September 30,
2008.
GENERAL
AND ADMINISTRATIVE EXPENSES
For the
three months ended September 30, 2009, general and administrative expenses,
which includes consulting and professional fees, were $6,803 compared to $5,330
for the three months ended September 30, 2008, an increase of $1,473 or
27.6%. The increase in total general and administrative expenses was
primarily attributable to cost associated with the Company’s Form S-1
registration statement.
OTHER
INCOME AND EXPENSES
Total
other income and expense increased to a net expense of $467 for three months
ended September 30, 2009 as compared to a net expense of zero for the three
months ended September 30, 2008. The increase in net expense is
attributed to the accrual of interest expense on the May 29, 2009 convertible
note due to related party.
OVERALL
We
reported a net loss for the three months ended September 30, 2009 of $7,270
compared to a net loss for the three months ended September 30, 2008 of
$5,330. This translates to an overall basic and diluted per-share
loss available to shareholders of $0.47 for the three months ended September 30,
2009 and $0.56 for the three months ended September 30, 2008 based on 15,435 and
9,438 weighted average common shares outstanding, respectively.
12
LIQUIDITY
AND CAPITAL RESOURCES
The
Company has financed its operations primarily through the advance of funds by
Mr. Rendina, Rendina, our Chairman, President, Chief Executive Officer and
Secretary, a related party and the sale of equity
securities. Overall, our liquidity and access to capital is very
limited; we have not received any commitment for additional financing and given
the size of our company we may be limited to (i) the sale of the Company’s
Common Stock or the issuance of convertible notes, (ii) other debt instruments,
or (iii) additional advances of funds from Mr. Rendina. Mr. Rendina
is under no obligation to advance additional funds to the Company.
Liquidity
is the ability of a company to generate funds to support its current and future
operations, satisfy its obligations and otherwise operate on an ongoing
basis. During the quarters ended September 30, 2009 and 2008 cash
used in our operating activities was $6,018 and $5,330,
respectively. We funded our operating activities during the three
months ended September 30, 2009 with cash reserves in addition to the following
resources and during the three months ended September 30, 2008 with the
following resources:
September
30,
|
September
30,
|
|||||||
2009
|
2008
|
|||||||
Proceeds
from related party
|
$
|
-
|
$
|
5,330
|
||||
Proceeds
from stock issuances
|
3,333
|
-
|
||||||
Total
|
$
|
3,333
|
$
|
5,330
|
At
September 30, 2009, we had a cash balance of $4,440 compared to $7,125 at June
30, 2009, a decrease of $2,685. At September 30, 2009, our working
capital deficit was $12,295 as compared to $8,358 at June 30,
2009. Our current assets consist only of cash.
Our
current liabilities consisted primarily of $15,950 due to Mr. Rendina and $785
in accounts payable.
If we are
to implement our business plan, we will need to raise significant amounts of
additional capital during the period ending June 30, 2010. We have
not received any commitment that any such additional financing would be
forthcoming. Accordingly, there can be no assurance that the Company
will be successful in selling equity or securing debt financing, or that any
combination thereof will be sufficient to meet our capital needs or, if it could
be obtained, that it can be obtained on reasonable terms in light of our
circumstances at that time. In addition, if any financing should be
obtained, existing shareholders will likely incur substantial, immediate, and
permanent dilution of their existing investment. (See also "PLAN OF
OPERATION")
RECENT
ACCOUNTING PRONOUNCEMENTS
Accounting
standards that have been issued or proposed by the FASB or other
standards-setting bodies that do not require adoption until a future date are
not expected to have a material impact on the Company’s consolidated financial
statements upon adoption.
Plan of
Operation
Our cash
balance is $4,440 as of September 30, 2009. We believe our cash
balance is not sufficient to fund our limited levels of operations for any
period of time. We have been utilizing and may utilize funds from
David Rendina, our Chairman, President and Chief Executive Officer, and
Secretary, who has informally agreed to advance funds to allow us to pay for
offering costs, filing fees, and professional fees. Mr. Rendina,
however, has no formal commitment, arrangement or legal obligation to advance or
loan funds to the company. In order to achieve our business plan
goals, we will need the funding from this offering and substantial additional
funding. We are a development stage company and have generated no revenue to
date.
13
Our
independent registered public accountant has issued a going concern opinion.
This means that there is substantial doubt that we can continue as an on-going
business for the next twelve months unless we obtain additional capital to pay
our bills. This is because we have not generated revenues and no
revenues are anticipated until we complete our initial business development.
There is no assurance we will ever reach that stage.
Our plan
of operation for the twelve months following the date of this prospectus is to
conduct further research on real and intangible properties that may be available
for acquisition, retain personnel with the required skills and develop our
financial models. Total expenditures over the next 12 months are therefore
expected to exceed the sum of both our cash on hand and amount to be raised in
this offering. If we experience such a shortage of funds prior to
funding during the next 12 months, we may utilize funds from David Rendina, our
sole officer and director, who has informally agreed to advance funds to allow
us to pay for professional fees, including fees payable in connection with the
filing of this registration statement and operation expenses, however he has no
formal commitment, arrangement or legal obligation to advance or loan funds to
the company. We will require the funds from this offering to
proceed.
If we are
successful in raising the funds from this offering, we plan to commence
activities to raise the funds required for the development program. We cannot
provide investors with any assurance that we will be able to raise sufficient
funds to proceed with any work or activities of the development
program. We plan to raise additional funding for development by way
of a private debt or equity financing, but have not commenced any activities to
raise such funds.
Since we
are a development stage company, any estimates by management are negligible at
this time as actual project costs would likely exceed any such
estimates. To date, we have not commenced with any activities or
operations of any phase of our development program.
Our plan
of operation is divided into four phases, as follows: (I) retain, on a
consulting basis, engineers to conduct technical and economic feasibility
studies of sites for construction of the first GHG technology support facility,
(II) negotiate an option to purchase agreement and exercise the option with a
suitable real property owner or technology developer, retain, on a
consulting basis, engineers to design the first GHG reduction support facility
and request for proposals from subcontractors and equipment manufacturers for
the construction of the first GHG reduction plant, and (III) construct a GHG
reduction support facility. We have begun discussions with an engineering
firm to engage in technical and economic feasibility studies but have not yet
commenced any other operations or activities.
Our plan
of operation for the twelve months following the date of this prospectus is to
(i) complete Phase I of our program, which is to develop our business models,
and conduct technical and economic feasibility studies of sites for construction
of the first facility, and available intellectual property, and (ii) complete
Phase II of our program, which is to negotiate and enter into a purchase
agreement with a real property owner and/or an intellectual
property purchase agreement with a technology development company, complete
detailed engineering plans for the GHG technology demonstration facility and
develop contracts, agreements and licenses based on our business models . In
addition to the $8,500,000 we anticipate spending for Phase I and II for the
development program as outlined below, we anticipate spending an additional
$500,000 on professional and administrative fees, including fees payable in
connection with the filing of this registration statement, complying with
reporting obligations and arranging financing for Phase I and II of our
development program. Total expenditures over the next 12 months are
therefore expected to be approximately $9,000,000 - $100,000 of which is the
amount to be raised in this offering. If we experience a shortage of funds
prior to funding during the next 12 months, we may utilize funds from David
Rendina, our Chairman of the Board of Directors, who has informally agreed to
advance funds to allow us to pay for professional fees, including fees payable
in connection with the filing of this registration statement and operation
expenses, however he has no formal commitment, arrangement or legal obligation
to advance or loan funds to the company. We will require the funds from
this offering to proceed.
If we are
successful in raising the funds from this offering, we plan to commence
activities to raise the $2,900,000 cash funds from the sale of equity and
$6,000,000 in debt required for Phase II of the development program in fall
2009. We expect that fundraising for this phase to take 30-90 days to
complete and an additional 9 to 12 months for engineers, lawyers,
accountants, and property development experts to conduct detailed technical and
economic studies related to the intangible property and/or sites for
construction of the first GHG facility. We cannot provide investors with
any assurance that we will be able to raise sufficient funds to proceed with any
work or activities on Phase I of the development program.
14
The above
program costs are management’s estimates and the actual project costs may exceed
our estimates. To date, we have not commenced with any activities or
operations of any Phase of our development program.
Following
Phase I of the development program, if it proves successful, in that engineers
successfully conduct technical and economic feasibility studies on prospective
IP and/or of sites for construction of first GHG facility, we intend, subject to
financing, to proceed with Phase II of our development program. In Phase II we
will negotiate and enter into terms of an option to purchase agreement to
purchase real/and or intangible property identified in Phase I. Provided that
the conditions of the option agreement can be met, we will exercise our option
to purchase the property. Subsequent to our purchase we will complete detailed
property development plans. The estimated cost of Phase II is
$8,900,000 and is anticipated take approximately 12 months to complete. As
with Phase I, we cannot provide investors with any assurance that we will be
able to raise sufficient funds to proceed with any work or activities on Phase
II of our development program. We plan to raise the additional funding for
Phase II by way of a private debt or equity financing, but have not commenced
any activities to raise such funds.
Following
Phase II of the development program, if it proves successful, in that we
successfully purchase selected real and/or intangible property, and complete the
planned engineering and business development activities we intend to proceed
with Phase III of our development program if we are able to raise the funds
necessary. Phase III is to complete construction of a GHG reducing
technology demonstration facility and demonstrate a technology that
produces low GHG emissions. The estimated cost of Phase III is $30,500,000
and is estimated to take approximately 18 months to 2 years to complete.
As with Phases I and II, we cannot provide investors with any assurance that we
will be able to raise sufficient funds to proceed with any work or activities on
Phase III of the development program, and we have no current plans on how to
raise the additional funding.
We
anticipate commencing Phase I of our program in September 2009. We will begin
Phase II of our development program in January 2010, depending on whether
Phase I program proves successful in establishing the technical and economic
feasibility studies of the real and/or intangible property. Subject to
financing, we anticipate commencing Phase III of our development program in
2011, depending on whether Phase II program proves successful in property
purchase. As with Phases I and II, we will require additional funding to
proceed with Phase III and we have no current plans on how to raise the
additional funding.
Phase
|
Development
Program
|
Cost
|
Status
|
||||
Phase
I
|
Technical
and economic feasibility studies for prospective IP and of sites for
construction of first GHG technology demonstration
facility.
|
$
|
100,000
|
Expected
to be completed in January 2010 (dependent on consulting engineer’s
schedule)
|
|||
Phase
II
|
Negotiate
and enter into property purchase agreement, and complete detailed
engineering and business development plans.
|
$
|
8,900,000
|
Expected
to be completed in January 2011
|
|||
Phase
III
|
Final
design and request for proposals from subcontractors and equipment
manufacturers. Construction of demonstration facility and pre-commercial
demonstration of GHG reduction technology.
|
$
|
30,500,000
|
Expected
to be completed by Spring
2012
|
15
Subsequent
Events
On
October 19, 2009, pursuant to the terms of a stock subscription agreement, the
Company issued to one person 100,000 restricted shares of the Company’s Common
Stock at $0.10 per share for cash consideration of $10,000. The
shares were offered and sold pursuant to the Company’s Form S-1 Registration
Statement.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
As a
smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are
not required to provide the information called for by this Item 3.
ITEM
4. CONTROLS AND PROCEDURES.
Under the
supervision and with the participation of our management, our principal
executive officer and our principal financial officer are responsible for
conducting an evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as of the end of the fiscal year
covered by this report. Disclosure controls and procedures means that
the material information required to be included in our Securities and Exchange
Commission reports is recorded, processed, summarized and reported within the
time periods specified in SEC rules and forms relating to our company, including
any consolidating subsidiaries, and was made known to us by others within those
entities, particularly during the period when this report was being prepared.
Based on this evaluation, our principal executive officer and principal
financial officer concluded as of the evaluation date that our disclosure
controls and procedures were effective as of September 30, 2009.
There
were no changes in the Company’s internal controls over financial reporting
during the most recently completed fiscal quarter that have materially affected
or are reasonably likely to materially affect the Company’s internal control
over financial reporting.
PART
II. OTHER INFORMATION
The
Company is not currently subject to any legal proceedings. From time
to time, the Company may become subject to litigation or proceedings in
connection with its business, as either a plaintiff or
defendant. There are no such pending legal proceedings to which the
Company is a party that, in the opinion of management, is likely to have a
material adverse effect on the Company’s business, financial condition or
results of operations.
RISK
FACTORS
|
As a
smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are
not required to provide the information called for by this Item 1A.
ITEM
2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS.
None.
ITEM
3. DEFAULTS UPON SENIOR SECURITIES.
None.
16
ITEM
5. OTHER INFORMATION.
Effective November
16, 2009, Thomas E. Puzzo consented to an appointment as a Director of the
Company, for a term of 12 months.
Mr. Puzzo
is a practicing lawyer, at his own firm, based in Seattle, Washington. Mr.
Puzzo’s law practice focuses on securities regulation and corporate
finance. He has represented numerous companies in raising capital via
public and private offerings of debt and equity securities, and counseled public
companies in connection with their ongoing reporting and other
obligations. He has also represented underwriters in public offerings,
broker-dealers in placing private offerings and venture capital funds and other
investors in non-public investment transactions. He has counseled clients
regarding compliance with various aspects of the Securities Exchange Act of
1934, as amended, and the Sarbanes-Oxley Act of 2002 and related
regulations. Mr. Puzzo also has extensive experience in counseling public
companies on maintaining compliance with Nasdaq and New York Stock Exchange and
NYSE Amex rules and Over-the-Counter Bulletin Board eligibility requirements.
Additionally, Mr. Puzzo has represented established and emerging businesses with
respect to intellectual property transfers and protection, primarily in the
areas of mergers, acquisitions, the employer-employee relationship, and
development, OEM and software license agreements. Mr. Puzzo received
his B.A. from the Evergreen State College in 1989. From 1989 to 1991, he
attended the University of Leiden in The Netherlands, where he studied
Philosophy and received a Propaedeutic Degree in Dutch. Mr. Puzzo received
his J.D. from Seattle University in 1997.
Mr. Puzzo
also acts as counsel to the Company, and Mr. Puzzo’s law firm bills the Company
for Mr. Puzzo’s services rendered to the Company. Mr. Puzzo does not
have any other agreement, arrangement or interested transaction with the
Company.
ITEM
6. EXHIBITS.
(a) Exhibits
required by Item 601 of Regulation SK.
Number
|
Description
|
|
3.1
|
Articles
of Incorporation*
|
|
3.2
|
Bylaws*
|
|
31.1
|
Certification
of Principal Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification
of Principal Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification
of Principal Executive Officer and Principal Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of
2002.
|
*Filed as
an Exhibit to the Company’s Registration Statement on Form S-1, as amended (File
No. 333-160366), as filed with the Securities and Exchange Commission on
July 1, 2009.
17
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.
GLOBAL
COOLING TECHNOLOGIES CORP.
|
||
(Name
of Registrant)
|
||
Date: November
16, 2009
|
By:
|
/s/ David Rendina
|
Name:
David Rendina
|
||
Title:
President and Chief Executive
Officer
|
18
EXHIBIT
INDEX
Number
|
Description
|
|
3.1
|
Articles
of Incorporation*
|
|
3.2
|
Bylaws*
|
|
31.1
|
Certification
of Principal Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification
of Principal Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification
of Principal Executive Officer and Principal Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of
2002.
|
*Filed as
an Exhibit to the Company’s Registration Statement on Form S-1, as amended (File
No. 333-160366), as filed with the Securities and Exchange Commission on
July 1, 2009.
19