Attached files
file | filename |
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EX-31.2 - CERTIFICATION OF PRINCIPAL ACCOUNTING OFFICER - AsherXino Corp | exhibit312.htm |
EX-32.2 - CERTIFICATION OF PRINCIPAL ACCOUNTING OFFICER - AsherXino Corp | exhibit322.htm |
EX-31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER - AsherXino Corp | exhibit311.htm |
EX-32.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER - AsherXino Corp | exhibit321.htm |
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
þ 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 number: 000-10965
ASHERXINO
CORPORATION
(Exact
name of registrant as specified in its charter)
Delaware
|
93-0962072
|
|
(State
or other jurisdiction of incorporation or organization)
|
(IRS
Employer Identification No.)
|
5847 San
Felipe Street, 17th
Floor
Houston,
TX 77002
(Address
of principal executive offices, including zip code)
713-413-3345
(registrant's
principal executive office telephone number)
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 No þ
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 þ
(Do not
check if a smaller reporting company)
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act) YES NO þ
APPLICABLE
ONLY TO CORPORATE ISSUERS
As of
November 20, 2009, 120,000,000 shares of common stock, $0.01 par value, were
outstanding.
Page
|
|
Part
I. Financial Information
|
|
Item
1. Financial Statements
|
|
Consolidated
Balance Sheets at September 30, 2009 and December 31, 2008
(unaudited)
|
3
|
Consolidated
Statements of Operations for the Three and Nine Months Ended
September 30, 2009 and 2008 and the Cumulative Period from January 1, 2009
through September 30, 2009 (unaudited)
|
4
|
Consolidated
Statements of Cash Flows for the Nine Months Ended September 30, 2009 and
2008 and the Cumulative Period from January 1, 2009 through September 30,
2009 (unaudited)
|
5
|
Notes
to Consolidated Financial Statements (unaudited)
|
6
|
Item
2. Management’s Discussion and Analysis of Financial
Condition and Results of Operations
|
8
|
Item
4T. Controls and Procedures
|
10
|
Part
II. Other Information
|
|
Item
1. Legal Proceedings
|
11
|
Item
1A. Risk Factors
|
11
|
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds
|
11
|
Item
6. Exhibits
|
11
|
Signatures
|
11
|
Part
I Financial Information
Item
1. Financial Statements
ASHERXINO
CORPORATION
(An
Exploration Stage Company)
CONSOLIDATED
BALANCE SHEETS
(Unaudited)
September
30,
|
December
31,
|
||
2009
|
2008
|
||
ASSETS
|
|||
Cash
and cash equivalents
|
$
26
|
$ 1,752
|
|
Property
and equipment, net
|
1,518
|
2,306
|
|
Due
from related party
|
-
|
10,664
|
|
Oil
and gas asset
|
53,750
|
-
|
|
Investment
in trading securities, marked-to-market
|
-
|
17,394
|
|
Total
assets
|
$
55,294
|
$
34,116
|
|
LIABILITIES
AND SHAREHOLDERS' EQUITY (DEFICIT)
|
|||
Current
liabilities:
|
|||
Accrued
liabilities
|
$
181,098
|
$
9,087
|
|
Indebtedness
to related party
|
45,402
|
-
|
|
Total
current liabilities
|
226,500
|
9,087
|
|
Commitments
and contingencies
|
|||
Shareholders'
equity (deficit):
|
|||
Common
stock, $0.01 par value. Authorized 300,000,000; issued and
outstanding 120,000,000 and 9,876,750 shares,
respectively
|
1,200,000
|
98,768
|
|
Additional
paid-in capital
|
8,321,100
|
9,346,848
|
|
Deficit
accumulated in development stage
|
(9,692,306)
|
(9,420,587)
|
|
Total
shareholders' equity (deficit)
|
(171,206)
|
25,029
|
|
Total
liabilities and shareholders' equity (deficit)
|
$
55,294
|
$ 34,116
|
See
accompanying notes to consolidated financial statements
- 3
-
ASHERXINO
CORPORATION
(An
Exploration Stage Company)
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three
Months
Ended
September 30,
|
Nine
Months
Ended
September 30,
|
Cumulative
Period from January 1, 2009 through September 30, 2009
|
||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||
General
and administrative expenses:
|
||||||||||||
Legal
|
$
65,446
|
$
100
|
$
170,297
|
$
100
|
$
170,297
|
|||||||
Other
|
39,673
|
7,316
|
99,200
|
15,985
|
99,200
|
|||||||
Total
general and administrative expenses
|
105,119
|
7,416
|
269,497
|
16,085
|
269,497
|
|||||||
Loss
from operations
|
(105,119)
|
(7,416)
|
(269,497)
|
(16,085)
|
(269,497)
|
|||||||
Net
realized loss from sale of trading securities
|
-
|
129,944
|
(1,958)
|
(52,360)
|
(1,958)
|
|||||||
Net
unrealized holding loss on trading securities
|
-
|
(32,980)
|
-
|
(55,848)
|
-
|
|||||||
Interest
expense
|
(231)
|
3
|
(264)
|
(932)
|
(264)
|
|||||||
Loss
before income taxes
|
(105,350)
|
89,551
|
(271,719)
|
(125,225)
|
(271,719)
|
|||||||
Income
tax provision
|
-
|
-
|
-
|
-
|
-
|
|||||||
Net
income (loss)
|
$
(105,350)
|
$
89,551
|
$
(271,719)
|
$ (125,225)
|
$ (271,719)
|
|||||||
Basic
and diluted loss per share
|
$
(0.00)
|
$
0.01
|
$
(0.00)
|
$
(0.01)
|
||||||||
Weighted
average common shares outstanding (basic and
diluted)
|
120,000,000
|
9,876,750
|
55,039,450
|
9,876,750
|
See
accompanying notes to consolidated financial statements
- 4
-
ASHERXINO
CORPORATION
(An
Exploration Stage Company)
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
|
Nine
Months Ended
September
30,
|
Cumulative
Period
from
January 1, 2009 through
September
30, 2009
|
|||||
2009
|
2008
|
||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|||||||
Net loss
|
$ (271,719)
|
$ (125,225)
|
$ (271,719)
|
||||
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
|||||||
Depreciation,
depletion and amortization
|
788
|
-
|
788
|
||||
Common
stock issued for services
|
12,647
|
-
|
12,647
|
||||
Proceeds
from sale of investments
|
15,436
|
137,507
|
15,436
|
||||
Unrealized
loss on trading securities
|
-
|
55,848
|
-
|
||||
Realized
loss on trading securities
|
1,958
|
52,360
|
1,958
|
||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
payable
|
181,098
|
(84,254)
|
181,098
|
||||
Net
cash provided by (used in) operating activities
|
(59,792)
|
36,236
|
(59,792)
|
||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|||||||
Indebtedness
to related party
|
56,066
|
(23,263)
|
56,066
|
||||
Net
cash provided by (used in) financing activities
|
56,066
|
(23,263)
|
56,066
|
||||
Net
increase (decrease) in cash
|
(3,726)
|
12,973
|
(3,726)
|
||||
Cash
at beginning of period
|
3,752
|
134
|
3,752
|
||||
Cash
at end of period
|
$
26
|
$ 13,107
|
$
26
|
||||
SUPPLEMENTAL
DISCLOSURES
|
|||||||
Interest
paid in cash
|
$
264
|
$ 935
|
|||||
Income
taxes paid in cash
|
-
|
-
|
|||||
NON-CASH
INVESTING AND FINANCING TRANSACTIONS
|
|||||||
Common
stock issued for oil and gas assets
|
$ 53,750
|
$
-
|
|||||
Forgiveness
of debt by related party
|
9,087
|
-
|
|||||
Officer
accrued compensation paid using trading securities
|
-
|
19,045
|
|||||
See
accompanying notes to consolidated financial statements
- 5
-
ASHERXINO
CORPORATION
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note
1 - Basis of Presentation
The
unaudited consolidated financial statements of AsherXino Corporation (the
"Company") have been prepared in accordance with accounting principles generally
accepted in the United States and the rules of the Securities
and Exchange Commission ("SEC"), and should be read in conjunction
with the audited financial statements and notes thereto contained in
the Company’s Registration Statement filed with the SEC on Form 10/A #2 on
November 9, 2009. In the opinion of management, all adjustments, consisting of
normal recurring adjustments, necessary for a fair presentation of financial
position and the results of operations for the interim periods presented have
been reflected herein. The results of operations for interim periods are not
necessarily indicative of the results to be expected for the full year. Notes to
the consolidated financial statements which would substantially duplicate the
disclosures contained in the audited financial statements for the most recent
fiscal year ended December 31, 2008, as reported on Form 10/A #2, have been
omitted.
Principles
of Consolidation
The
accompanying consolidated financial statements include the accounts of AsherXino
Corporation and its wholly owned subsidiary, ASHER Energy Transactions Services
Limited, a Nigerian registered company. All significant intercompany
accounts and transactions have been eliminated in consolidation.
New Accounting
Pronouncements
In July
2009, the Financial Accounting Standards Board (“FASB”) issued new guidance
relating to the “FASB
Accounting Standards Codification” at ASC 105, as the single source of
authoritative nongovernmental U.S. generally accepted accounting principles
(GAAP). The codification is effective for interim periods ending after September
15, 2009. All existing accounting standards are superseded as described in ASC
105. All other accounting literature not included in the Codification is
non-authoritative. The adoption of ASC 105 did not impact the Company’s results
of operations, financial position or cash flows.
Effective
for the quarter ended June 30, 2009, the Company implemented ASC 855, Subsequent
Events. This standard establishes general standards of accounting for and
disclosure of events that occur after the balance sheet date but before
financial statements are issued. The adoption of ASC 855 did not impact the
Company’s financial position or results of operations. The Company evaluated all
events or transactions that occurred after September 30, 2009 up through
November 20, 2009, the date the Company issued these financial statements.
During this period, the Company had no subsequent events.
Exploration
Stage
During
the first quarter of 2009 the Company engaged in serious discussions with owners
of certain oil and gas assets, and preliminary discussions with various entities
regarding potential debt and equity financing to support the exploitation of any
assets to be acquired. These discussions ultimately led to the
Company’s acquisition of a 40% leasehold interest in and operatorship of an
offshore oil exploration and development block in Nigeria, Oil Prospecting
License (OPL) 2012, which acquisition was effective June 30,
2009. Management has determined, therefore, that in early 2009 when
such discussions began in earnest, the Company entered the exploration
stage and, for this reason, the accompanying interim financial statements set
forth cumulative financial information for the period elapsed since the
inception of this new exploration stage, which we deem to have occurred on or
about January 1, 2009.
Reclassifications
Certain
amounts in the 2008 financial statements have been reclassified to conform with
the 2009 financial statement presentation.
Note 2 - Related Party
Transactions
During
the nine months ended September 30, 2009, the President of the Company advanced
the Company a total of $56,066. The Company did not repay the President
any amount during this period and the amount owed by the Company to the
President at September 30, 2009 totaled $45,402. On July 1, 2009, the
President released the Company for $9,087 of amounts due to him.
- 6
-
Note
3 - Going Concern
As
reflected in the accompanying financial statements, we had a working capital
deficit of $226,474 and an accumulated deficit of approximately $9,692,306 at
September 30, 2009, which raise substantial doubt about the Company's ability to
continue as a going concern. Management plans to raise funds through
the issuance of debt or the sale of common stock.
Our
ability to continue as a going concern is dependent on our ability to raise
capital through the issuance of debt or the sale of common stock. The
financial statements do not include any adjustments that might be necessary if
we were unable to continue as a going concern.
Note
4 - Investments
During
the nine months ended September 30, 2009, we sold the remaining 44,600 shares of
Hythiam Inc. (“Hythiam”) common stock for total proceeds of $15,436. For the
nine months ended September 30, 2009 and 2008, we recognized unrealized losses
of $0 and $55,848 respectively. In addition, we recognized realized losses of
$1,958 and $52,360 with net proceeds of $15,436 and $137,507, respectively. As
of September 30, 2009, we did not own any shares of Hythiam’s common
stock. Management did not intend to hold the shares of Hythiam common
stock for investment purposes, and accordingly, classified the shares as
“trading securities” for all periods presented. Because of such
classification, unrealized gains and losses were recorded in
operations.
Note 5 - Common Stock
On March
27, 2009, the Company’s Certificate of Incorporation was amended to increase the
number of authorized shares of common stock from 250,000,000 to 300,000,000,
$0.01 par value, and to eliminate the Company’s authorized preferred
stock. In addition, on June 19, 2009, the Company authorized a 1.5
for 1 stock split, which has been retroactively applied for all periods
presented.
During
the nine months ended September 30, 2009, we issued 4,991,250 shares of split
adjusted common stock for services for total expense of $12,647. The common
stock was valued using the liquidation value of net assets immediately prior to
the grant date.
During
the nine months ended September 30, 2009, we issued 105,000,000 shares of split
adjusted common stock for the acquisition of oil and gas assets as discussed in
Note 8 – Change of Control.
Note 6
- Change of Control
Pursuant
to an Asset Purchase Agreement dated June 30, 2009, in consideration for the
issuance of 105,000,000 shares of the Company’s common stock (87.5% of the
Company’s post-transaction total outstanding common stock) to Bayo Odunuga,
Patrick Okorodudu and Asher MHG Foundation, the Company acquired from such
individuals a 40% leasehold interest in and operatorship of Oil Prospecting
License (OPL) 2012 through an assignment of all of such individuals’ right,
title and interest in and to a Memorandum of Agreement dated March 14, 2009
(“MOA”), a Farm In Agreement dated March 14, 2009 (“Farm In Agreement”) and a
proposed Production Sharing Contract (“PSC”). This transaction was
accounted for as an asset purchase. In connection with such
transaction, Bayo Odunuga became Chief Executive Officer and director of the
Company and Patrick Okorodudu became Secretary, General Counsel and director of
the Company. The value of the oil and gas property was $53,750 on the
date of acquisition, which was the cumulative cost incurred by Messrs. Odunuga
and Okorodudu in acquiring the asset.
- 7
-
Note 7
- Commitments and Contingencies
Unasserted
Claim
In
November 2001, the Company and Alternative Products, Inc. (“ATP”) entered into
preliminary discussions regarding a purchase by the Company of all of the
outstanding shares of ATP. No agreement was ever finalized and the
Company received a letter of notification from ATP terminating any agreement
between them. Management believes that no such agreement ever
existed. From time to time thereafter, John Bancroft (either individually or as
President of ATP) has claimed that the Company owes either him or ATP various
amounts including Five Million Dollars ($5,000,000) in Class B Preferred Stock,
One Million Dollars ($1,000,000) in Common Stock and payments of Three Hundred
Fifty-Six Thousand Dollars ($356,000) under purported employment and employment
related agreements. Management believes that no such agreements exist
or ever existed and that the claims by Bancroft and/or ATP are wholly without
merit. Counsel has advised management, in the event litigation should
be brought on this claim, that the Company would have a number of meritorious
defenses, including but not limited to statute of limitations, the absence of
any agreement binding upon the Company and the aforementioned termination of any
such agreement.
CAUTIONARY
STATEMENT ON FORWARD-LOOKING INFORMATION
The
Company is including the following cautionary statement to make applicable and
take advantage of the safe harbor provision of the Private Securities Litigation
Reform Act of 1995 for any forward-looking statements made by, or on behalf of,
the Company. This quarterly report on Form 10-Q contains “forward looking
statements” (as that term is defined in Section 27A(i)(1) of the Securities Act
of 1933), including statements concerning plans, objectives, goals, strategies,
expectations, future events or performance and underlying assumptions and other
statements which are other than statements of historical facts. Such
forward looking statements involve risks and uncertainties which could cause
actual results or outcomes to differ materially from those expressed in the
forward looking statements. Some of the factors that could cause
actual results to differ materially from those expressed in such forward looking
statements are set forth in the section entitled “Risk Factors” and elsewhere
throughout this Form 10-Q. Our expectations, beliefs and projections
are expressed in good faith and are believed by us to have a reasonable basis,
but there can be no assurance that our expectations, beliefs or projections will
result or be achieved or accomplished. We have no obligation to
update or revise forward looking statements to reflect the occurrence of future
events or circumstances.
Item
2. Management's Discussion and Analysis of Financial Condition and Results of
Operations
Since the
Company has had no business operations from 2003 until its recent acquisition of
certain Nigerian oil related assets, i.e. a 40% leasehold interest in and
operatorship of Nigerian Oil Prospecting License (OPL) 2012 (“OPL 2012”), and
therefore no income from operations, this discussion involves only the plan of
operation.
The
Company’s Board of Directors has recently taken the decision to enter into the
business of owning and operating oil and gas assets by acquiring certain oil
related assets. The Company’s immediate objective is to create value
from the production and exploration opportunities in its significant working
interest in OPL 2012 by embarking on a work program that will include drilling
operations and the hiring of about fifty to one hundred full-time
employees. The Company intends to finance its operations through a
combination of debt and equity financing. In addition, management may
decide to farm-out or sell some of the Company’s interest in OPL 2012 to finance
the development of the block. The Company also intends to acquire
additional leaseholds in and operatorships of offshore blocks in Nigeria and
Ghana. In the long term, the Company aims to acquire and exploit the
prolific oil and gas deposits across the Gulf of Guinea and
worldwide.
The
Company currently has few capital resources and is unlikely to generate
significant revenues for some time. This raises substantial doubt
about the Company’s ability to continue as a going concern. See Notes
to the Company’s Consolidated Financial Statements in Item 1, “Financial
Statements”. Without realization of additional capital, it would be
unlikely that the Company could continue as a going concern. However,
management has been in discussions with several financial institutions (i.e.
banks, private equity funds, sovereign funds, energy companies and other
corporate entities) to procure funding for the development of OPL 2012 through
the issuance of debt and/or equity. Based on these discussions
management anticipates obtaining sufficient funding to perform the Company’s
obligations related to OPL 2012 over the next year.
- 8
-
Management
is in the process of concluding financing arrangements with financial
institutions in Nigeria who are finalizing their due diligence and economic
modeling for the project. Management anticipates raising sufficient
funds to pay the $12,500,000 signature bonus to the Nigerian government and the
$10,000,000 farm-in fee to the Company’s local partner in the near
future.
Upon the
payment of the signature bonus, the development of OPL 2012 will take place in
two phases over a three year period. In Phase 1 (Year 1), the Company
will pursue one of two scenarios. Scenario 1 involves working jointly
with Eni Agip Nigeria Limited (“Eni/Agip”) to develop OPL 2012 through the
unitization process, which enables owners of two straddled oil fields to proceed
with the development and operation of the field as a single unit, to ensure
maximum hydrocarbons recovery with no duplication of costs. Scenario
2 involves pursuing an international joint venture partnership with Superior
Well Drilling LLC and its local Nigerian partner Omega Maritime & Energy
Limited (collectively, “Superior”) to drill and complete one vertical well at
4,000 feet. Superior will provide rigs and drill the well, and
Superior will be paid from proceeds of hydrocarbons
recovered. Engineering and environmental work will be done prior to
drilling and completing the vertical well. Such engineering and
environmental work will include the casing and design of the well.
In either
Scenario 1 or 2, revenue sharing between the Company and Eni/Agip or Superior
will be negotiated and agreed by the parties. Also, neither scenario
includes provision for a 3D seismic program, as the Company now believes that,
based on technical evaluation of OPL 2012, there is a chance that a 3D seismic
survey may not need to be performed given there exists vintage 2D seismic data
on OPL 2012.
Scenario
1 is the Company’s preferred option because it is more cost
effective. Production facilities are available in Eni/Agip’s
neighboring OML 116, and only require that the lateral well from OML 116 be
extended into OPL 2012. Under Scenario 1, the Company may be able to
avoid any further engineering work since all technical data relating to OPL 2012
will be provided from ongoing development and production in OML
116. However, the Company has not yet obtained Eni/Agip’s agreement
to jointly develop OPL 2012. In the event the Company is unsuccessful
in obtaining Eni/Agip’s timely agreement, the Company will proceed with Scenario
2. The Company has entered into an international Joint Venture
Agreement (“JV Agreement”) with Superior pursuant to which Superior will execute
drilling and operations for oil drilling projects secured by the Company (such
as Scenario 2) and be reimbursed for providing such services by the joint
venture from crude oil sales. (See tables below)
YEAR
1 (Project Phase 1) – Authorization For Expenditure (AFE)
SCENARIO 1 (With agreement to unitize
with Eni/Agip)
DESCRIPTION
|
TIME/DATE
|
AMOUNT
|
SOURCE
|
|
Signature
Bonus
|
Pre-Day
1
|
$12,500,000
|
Banks/Pr.
Equity funds
|
|
Farm-In
Fees
|
Pre-Day
1
|
$10,000,000
|
Banks/Pr.
Equity funds
|
|
Unitization
with AGIP (to extend lateral well into OPL 2012)
|
Day
1-60
|
$10,000,000
|
Banks/Pr.
Equity funds
|
|
Salaries
and Operating Expenses
|
Day
1-365
|
$3,000,000
|
Banks/Pr.
Equity funds
|
|
WORK
PROGRAM COSTS
|
Day
1-365
|
$35,500,000
|
SCENARIO 2 (To partner with
Superior and drill and complete one vertical well)
DESCRIPTION
|
TIME/DATE
|
AMOUNT
|
SOURCE
|
|
Signature
Bonus
|
Pre-Day
1
|
$12,500,000
|
Banks/Pr.
Equity funds
|
|
Farm-In
Fees
|
Pre-Day
1
|
$10,000,000
|
Banks/Pr.
Equity funds
|
|
Engineering
& Environmental Work (Casing & Design)
|
Day
1-60
|
$4,500,000
|
Banks/Pr.
Equity funds
|
|
Drill
and Complete One Vertical Well @ 4,000 feet
|
Day
61-91
|
$50,000,000
|
JV
Partners and Banks/Pr. Equity funds
|
|
Salaries
and Operating Expenses
|
Day
1-365
|
$3,000,000
|
Banks/Pr.
Equity funds
|
|
WORK
PROGRAM COSTS
|
Day
1-365
|
$80,000,000
|
- 9
-
The
project activities listed above are scheduled to run
consecutively. Upon the payment of the signature bonus, the Company
will submit its work program to the Nigerian government agencies responsible for
oil exploration and production, Department of Petroleum Resources (DPR) and the
Nigerian National Petroleum Corporation (NNPC), who will each have to
review the work program and approve it before any exploration or production
can commence. Once the government agencies approve the work program,
management will decide on the appropriate scenario to pursue for Phase
1. Day 1, the official start date of the OPL 2012 development
project, will occur as soon as management determines which scenario it will
follow.
In Phase
2 (Year 2 and 3), two or three additional wells will be drilled at an estimated
total cost of $205,000,000. (See table below)
YEAR
2 - 3 (Project Phase 2)
DESCRIPTION
|
TIME/DATE
|
AMOUNT
|
SOURCE
|
|
Drill
and complete 2 Directional Drilling (DD) wells @ 5,000
feet
|
Day
366 - 1095
|
$200,000,000
|
JV
Partners & Crude Oil Sale & Pr. Equity funds
|
|
Salaries
and Operating Expenses
|
Day
366 - 1095
|
$5,000,000
|
Banks/Pr.
Equity funds
|
|
WORK
PROGRAM COSTS
|
Day
366 - 1095
|
$205,000,000
|
Should
the Company be unable to fund any of the development costs related to OPL 2012,
its local partner Sigmund Oilfield Limited would notify the Company of its
non-performance and formally request that the Company perform its agreed
obligations. The Company would be given the opportunity to rectify or
cure such fundamental non-performance issues if they are within the Company’s
control. In case of further default, Sigmund Oilfield Limited would
have the option to seek to terminate its agreements with the Company and
potentially terminate the Company’s interest in OPL 2012. However,
the OPL 2012 agreements were not drafted in such a manner that allows for
immediate repercussions or sanctions imposed on the Company in the event the
Company is unable to fund any of the development costs. Rather, the
agreements provide for a dispute resolution process and contemplate discussion
and negotiation among the parties in the event of the Company’s inability to
perform. For example, although the $12,500,000 signature bonus and
$10,000,000 farm-in fee were each deemed payable on May 15, 2009, the Company
has suffered no negative consequences from being delinquent in paying these
amounts since it has regularly updated Sigmund Oilfield Limited on the status of
when payments would be made and Sigmund Oilfield Limited has granted informal
extensions of time for the Company to make such payments.
Item
4T. Controls and procedures
Evaluation
of Disclosure Controls and Procedures
Under the
supervision and with the participation of certain members of our management,
including our Chief Executive Officer and interim Chief Financial Officer, we
completed 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)
to the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).
In light of the material weaknesses discussed below, which have not been fully
remediated as of the end of the period covered by this Quarterly Report, our
Chief Executive Officer and interim Chief Financial Officer concluded, after the
evaluation described above, that our disclosure controls were not effective. As
a result of this conclusion, the consolidated financial statements for the
period covered by this report were prepared with particular attention to the
material weaknesses previously disclosed. Accordingly, management believes that
the consolidated financial statements included in this Quarterly Report fairly
present, in all material respects, our financial condition, results of
operations and cash flows as of and for the periods presented.
Internal
Control over Financial Reporting
In
connection with our evaluation of our disclosure controls and procedures that
occurred during our last fiscal quarter, we identified no change in the
Company's internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.
- 10
-
For
information regarding our legal proceedings see Item 8 of our registration
statement on Form 10/A #2 filed on November 9, 2009.
Item
1A. Risk Factors
For
information regarding our risk factors see the risk factors disclosed in Item 1A
of our registration statement on Form 10/A #2 filed on November 9, 2009. There
have been no material changes from the risk factors previously disclosed in such
registration statement.
Item 2. Unregistered Sales of Equity
Securities and Use of Proceeds
The
Company has not sold any of its equity securities during the period covered by
this Quarterly Report.
Item
6. Exhibits
Exhibit
31.1 - Certification of Chief Executive Officer of AsherXino Corporation
required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of
1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
Exhibit
31.2 - Certification of Chief Financial Officer of AsherXino Corporation
required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of
1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
Exhibit
32.1 - Certification of Chief Executive Officer of AsherXino Corporation
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18
U.S.C. 63.
Exhibit
32.2 - Certification of Chief Financial Officer of AsherXino Corporation
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18
U.S.C. 63.
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.
AsherXino
Corporation
|
||
Dated:
November 20, 2009
|
By:
|
/s/
Bayo O. Odunuga
|
Name: Bayo
O. Odunuga
Title: Chief
Executive Officer
Principal Executive Officer
|
||
Dated:
November 20, 2009
|
By:
|
/s/ Bayo
O. Odunuga
|
Name: Bayo
O. Odunuga
Title: Interim
Chief Financial Officer
Interim Principal Financial and Accounting Officer
|