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EX-31.01 - EXHIBIT 31.01 - RTS Oil Holdings, Inc.geoex3101q123109.htm
EX-32.01 - EXHIBIT 32.01 - RTS Oil Holdings, Inc.geoex3201q123109.htm

 
 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2009


Commission File Number 000-53182


GEO POINT TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
 
Utah
11-3797590
(State or other jurisdiction of
(I.R.S. Employer Identification No.)
incorporation or organization)
 
 
1306 East Edinger Avenue, Unit C
Santa Ana, CA  92705
(Address of principal executive offices)
 
(714) 665-8777
(Registrant’s telephone number)
 
n/a
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes  
x
No  
o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes  
o
No  
o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer o
Accelerated filer ¨
Non-accelerated filer o
Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes 
o
No 
x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.  As of February 15, 2010, issuer had 3,257,000 outstanding shares of common stock, par value $0.001.

 
 

 

TABLE OF CONTENTS


 
Page
   
PART I – FINANCIAL INFORMATION
 
 
Item 1. Financial Statements
 
 
Condensed Balance Sheets (Unaudited)
3
 
Condensed Statements of Operations (Unaudited)
4
 
Condensed Statements of Cash Flows (Unaudited)
5
 
Notes to the Condensed Financial Statements (Unaudited)
6
 
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of  Operations
9
 
Item 3. Quantitative and Qualitative Disclosures about Market Risk
11
 
Item 4T. Controls and Procedures 
11
     
PART II – OTHER INFORMATION
 
 
Item 6. Exhibits
12
 
Signature
12



 
 

 

 
 PART I – FINANCIAL INFORMATION
 
 ITEM 1.  FINANCIAL STATEMENTS
 
 GEO POINT TECHNOLOGIES, INC.
 CONDENSED BALANCE SHEETS
(Unaudited)
       
 
December 31,
 
March 31,
 
2009
 
2009
           
ASSETS
         
Current Assets
         
Cash
$
           85,707 
 
$
      156,807 
Accounts receivable, net of allowance for bad debt of $65,783 and $65,783, respectively
 
         12,459 
   
         11,228 
Prepaid expenses and other current assets
 
                   - 
   
4,125 
Total Current Assets
 
        98,166 
   
       172,160 
Furniture and equipment, net of accumulated depreciation of           
    $43,819 and $34,819, respectively
 
          4,358 
   
13,358 
Other assets
 
1,103 
   
1,000 
Total Assets
$
       103,627 
 
$
        186,518 
           
LIABILITIES AND SHAREHOLDERS' EQUITY
         
Current Liabilities
         
Accounts payable and accrued liabilities
$
           53,241 
 
$
           69,400 
Income taxes payable
 
                   - 
   
        13,887 
Total Current Liabilities
 
      53,241 
   
        83,287 
           
Shareholders' Equity
         
Preferred Stock - $0.001 par value; 5,000,000 shares authorized;          
     none outstanding
 
          - 
   
                   - 
Common stock - $0.001 par value; 100,000,000 shares authorized;          
     3,257,000 and 3,257,000 shares issued and outstanding, respectively
 
           3,257 
   
3,257 
Additional paid-in capital
 
       246,693 
   
246,693 
Accumulated deficit
 
       (199,564)
   
(146,719)
Total Shareholders' Equity
 
        50,386 
   
       103,231 
Total Liabilities and Shareholders' Equity
$
        103,627 
 
$
        186,518 
           
 
 The accompanying notes are an integral part of the condensed unaudited financial statements.
 
3
 
 
 
 
 

 

 

 GEO POINT TECHNOLOGIES, INC.
 CONDENSED STATEMENTS OF OPERATIONS
 (Unaudited)
 
 
For the Three Months Ended
 
For the Nine Months Ended
 
December 31,
 
December 31,
 
2009
 
2008
 
2009
 
2008
                       
Sales
$
     15,022 
 
$
      851 
 
$
   125,341 
 
$
   157,750 
Cost of Sales
 
       7,693 
   
      1,140 
   
         52,636 
   
       37,601 
Gross Profit (Loss)
 
       7,329 
   
        (289)
   
         72,705 
   
     120,149 
Operating Expenses
                     
General and administrative expenses
 
     34,315 
   
    45,942 
   
     125,429 
   
     162,432 
Total Operating Expenses
 
 34,315 
   
    45,942 
   
  125,429 
   
   162,432 
Operating Loss
 
(26,986)
   
 (46,231)
   
 (52,724)
   
   (42,283)
Other income (expense)
 
         2 
   
        561 
   
     (121)
   
         1,813 
Net Loss
$
   (26,984)
 
$
 (45,670)
 
$
  (52,845)
 
$
     (40,470)
                       
Basic and Diluted Loss per Share
$
      (0.01)
 
$
    (0.01)
 
$
     (0.02)
 
$
      (0.01)
Basic and Diluted Weighted-Average
                     
Common Shares Outstanding
 
3,257,000 
   
    3,257,000 
   
   3,257,000 
   
     3,257,000 
                       
 The accompanying notes are an integral part of the condensed unaudited financial statements.
 
 4
 

 
 
 

 


 GEO POINT TECHNOLOGIES, INC.
 CONDENSED STATEMENTS OF CASH FLOWS
 (Unaudited)
 
 
For the Nine Months Ended
 
December 31,
 
2009
 
2008
           
Cash Flows from Operating Activities:
         
Net loss
$
            (52,845)
 
$
            (40,470)
 Adjustments to reconcile net loss to net cash from operating activities:
         
 Depreciation
 
                 9,000 
   
                 9,000 
 Bad debt
 
                      - 
   
               64,880 
Changes in assets and liabilities:
         
 Accounts receivable
 
                (1,230)
   
              (68,342)
 Prepaid expenses and other current assets
 
                 4,022 
   
                      - 
 Accounts payable and accrued liabilities
 
              (16,160)
   
              (43,962)
 Income taxes payable
 
              (13,887)
   
                      - 
Net Cash Used in Operating Activities
 
              (71,100)
   
              (78,894)
Cash Flows from Investing Activities:
         
Purchase of property and equipment
 
                      - 
   
                (5,959)
Net Cash Used in Investing Activities
 
                      - 
   
                (5,959)
Net Change in Cash
 
              (71,100)
   
              (84,853)
Cash at Beginning of Period
 
              156,807 
   
              192,720 
Cash at End of Period
$
              85,707 
 
$
            107,867 
           
           
Supplement Disclosure of Cash Flow Information:
         
 Cash paid for interest
$
                    - 
 
$
                    - 
 Cash paid for income taxes
$
               7,197 
 
$
                    - 
           
 The accompanying notes are an integral part of the condensed unaudited financial statements.
 
 5
 

 
 
 

 

GEO POINT TECHNOLOGIES, INC.
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
DECEMBER 31, 2009
(Unaudited)

NOTE 1 – ORGANIZATION AND BUSINESS

Geo Point Technologies, Inc. (the “Company”), was incorporated in the state of California on November 26, 2002.  The Company’s operations are located in Santa Ana, California.  In 2006, the Company formed Geo Point Merger Co., a Utah corporation, for the purpose of moving the domicile of the Company from California to Utah.  The move was accomplished with an Agreement and Articles of Merger entered into by the two companies.  Under the terms of the merger, upon execution, the two companies merged, and the Utah company was designated as the surviving corporation.  The sole shareholder of the California company surrendered his stock and received one share of stock in the Utah company for every share of the California company.  The articles of incorporation and bylaws of the Utah company became the articles and bylaws of the surviving corporation.  The Utah company furthermore acquired all the assets and obligations of any kind of the California company.  Finally, upon execution of the Agreement and Articles of Merger, the name of Geo Point Merger Co. was changed to Geo Point Technologies, Inc.

The Company provides geological and earth study services related to: land surveying for new construction; soil testing and environmental risk and impact assessments; natural resource assessments with an emphasis on oil, and gas deposit discovery.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission, or SEC.  Certain information and disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, have been condensed or omitted pursuant to such rules and regulations.  In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim financial statements should be read in conjunction with the March 31, 2009, audited annual financial statements contained in the Form 10-K filed June 25, 2009, with the SEC.

The results of operations for the three and nine months ended December 31, 2009 and 2008, are not necessarily indicative of the results that may be expected for the full year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes to financial statements.  Actual results could differ from those estimates.  Significant estimates made by management include allowance for doubtful accounts and the useful life of property and equipment.
 
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Fair Value of Financial Instruments

Financial instruments consist of cash, accounts receivable, and payables.  The fair value of financial instruments approximated their carrying values as of December 31, 2009.

Allowances for Doubtful Accounts

The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of the Company’s customers to make required payments.  The Company considers the following factors when determining if collection of a fee is reasonably assured: customer creditworthiness and past transaction history with the customer; if the Company has no previous experience with the customer, the Company typically requests retainers or obtains financial information sufficient to extend the credit.  If these factors do not indicate collection is reasonably assured, revenue is deferred until collection becomes reasonably assured, which is generally upon receipt of cash.  If the financial condition of the Company’s customers deteriorates, additional allowances are made.

Revenue Recognition

The Company recognizes revenue when it is realized and earned.  The Company considers revenue realized or realizable and earned when (1) it has persuasive evidence of an arrangement, (2) services have been rendered and are invoiced, (3) the price is fixed or determinable, and (4) collectibility is reasonably assured.

The Company’s primary source of revenue has been in its environmental division, providing historical site data searches, preliminary investigation and drilling, site characterization modeling, regulatory agency liaison, and full environmental clean-ups using such methods as vapor extraction, air sparging, bio-remediation, ORC (Oxygen Release Compound) and HRC (Hydrogen Release Compound) injection treatment, air stripping, and ionic exchange.   
 
The Company also has operations associated with the oil and gas segment that have limited activity and have not yet generated revenues.

Concentrations

Two customers represented 49.2% of total sales for the nine months ended December 31, 2009.  Two customers accounted for 100% of the gross accounts receivable balance as of December 31, 2009.  The loss of one or more of these customers would adversely affect the Company.

Basic and Diluted Loss per Common Share

Basic loss per share is calculated by dividing net loss by the weighted average common shares outstanding during the period.  Diluted loss per share reflects the potential dilution to basic earnings per share that could occur upon conversion or exercise of securities, options, or other such items to common shares using the treasury stock method, based upon the weighted average fair value of the Company’s common shares during the period.  As of December 31, 2009 and 2008, the Company did not have any dilutive securities.
 
7


 
 

 

Recent Accounting Pronouncements

In May 2009, the Financial Accounting Standards Board (“FASB”) issued FASB ASC 855 Subsequent Events (formerly SFAS No. 165, Subsequent Events).  FASB ASC 855 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued.  FASB ASC 855 is effective for interim and annual financial periods ending after June 15, 2009.  The Company adopted FASB ASC 855 during the three months ended June 30, 2009.  The Company evaluated subsequent events through the issuance date of the financial statements, February 16, 2010, noting no items that require disclosure.

In June 2009, the FASB issued FASB ASC 105 Generally Accepted Accounting Principles (formerly SFAS No. 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles – a replacement of FASB Statement No. 162).  FASB ASC 105 establishes the FASB Accounting Standards Codification as the source of authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities.  FASB ASC 105, which changes the referencing of financial standards, is effective for interim or annual financial periods ending after September 15, 2009.  The Company adopted FASB ASC 105 during the three months ended December 31, 2009, with no impact to its financial statements, except for the changes related to the referencing of financial standards.
 
8

 
 

 

ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Certain statements in Management’s Discussion and Analysis, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934.  These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “plan,” “may,” “should,” and similar expressions.  Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially from the forward-looking statements.

Overview

We are a provider of geological and earth study services related to land surveying for new construction, soil testing and environmental risk and impact assessments, and natural resource assessments with an emphasis on oil and gas deposit discovery.  Our services generally are provided in connection with construction projects.

Sources of Revenues

We derive our revenues through geological and earth study services related to land surveying for new construction, soil and groundwater environmental impact assessments, environmental clean-up, and natural resource assessments with an emphasis on oil and gas deposit discovery.  Thus far, all of our revenues are derived in the state of California.

Cost of Revenues and Operating Expenses

Cost of Revenues.  Cost of revenues consists of direct supplies and direct labor related to the fulfillment of each job.

General and Administrative.  General and administrative expenses consist of compensation and related expenses for executive, finance, accounting, administrative, legal, professional fees, other corporate expenses, and marketing.

Critical Accounting Policies

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures.  On an ongoing basis, we evaluate our estimates and assumptions.  Our actual results may differ from these estimates under different assumptions or conditions.

We believe that of our significant accounting policies, which are described in Note 2 to the financial statements, the following accounting policy involves a greater degree of judgment and complexity.  Accordingly, this is the policy we believe is the most critical to aid in fully understanding and evaluating our financial condition and results of operations.
 
9


 
 

 

Revenue Recognition.  We recognize revenue when it is realized and earned.  We consider revenue realized or realizable and earned when: (1) we have persuasive evidence of an arrangement; (2) services have been rendered and are invoiced; (3) the price is fixed or determinable; and (4) collectibility is reasonably assured.  We generate revenues from two environmental services: land surveying and engineering for new construction and environmental impact studies and clean-up services.  Operations associated with the oil and gas segment have not yet generated revenues.  If and when oil production begins, revenue will be recorded when the product is delivered to the purchaser.

Results of Operations

Comparison of Three Months Ended December 31, 2009 and 2008

Revenues.  Revenues for the three months ended December 31, 2009, were $15,022, an increase of $14,171 over revenues of $851 for the comparable period in 2008.  The increase in revenues was primarily due to the lack of open jobs in fiscal 2008.

Cost of Revenues.  Cost of revenues for 2009 was $7,693, an increase of $6,553 over cost of revenues of $1,140 for 2008.  The increase in cost of revenues from 2008 to 2009 was directly related to the increase in revenues.

General and Administrative Expenses.  General and administrative expenses for 2009 were $34,315, a decrease of $11,627 over general and administrative expenses of $45,942 for 2008.  This decrease was primarily due to a decrease in professional fees and other general corporate expenditures.

Comparison of Nine Months Ended December 31, 2009 and 2008

Revenues.  Revenues for the nine months ended December 31, 2009, were $125,341, a decrease of $32,409 over revenues of $157,750 for the comparable period in 2008.  The decrease in revenues was due primarily to the completion of two significant contracts during the first quarter of fiscal 2008. Increased competition from competitive proposals was an additional factor.

Cost of Revenues.  Cost of revenues for 2008 was $52,636, an increase of $15,035 over cost of revenues of $37,601 for 2008.  The increase in cost of revenues from 2009 to 2008 was directly related to the lower margins obtained on current year projects due to increased competition from competitive proposals.

General and Administrative Expenses.  General and administrative expenses for 2009 were $125,429, a decrease of $37,003 over general and administrative expenses of $162,432 for 2008.  This decrease was primarily due to a decrease in professional fees and other general corporate expenditures.

Cash Flows from Operating Activities

Net Cash Used in Operating Activities.  Net cash used in operating activities during the nine months ended December 31, 2009, was $71,100, compared to net cash used in operating activities for the nine months ended December 31, 2008, of $78,894.  This decrease in cash used for operations was primarily due to accounts payable, which decreased less during the nine months ended December 31, 2009, compared with the same period in 2008.
 
10

 
 

 


Liquidity and Capital Resources

As of December 31, 2009, our principal source of liquidity was cash totaling $85,707.  The primary source of our liquidity during the nine months ended December 31, 2009, was our cash on hand.

We believe that our current cash together with our expected cash flows from operations will be sufficient to meet our anticipated cash requirements for working capital and capital expenditures, including our marketing efforts, for at least the next 12 months.

Off-Balance Sheet Arrangements

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


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.


ITEM 4T.  CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit to the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized, and reported within the time periods specified by the Securities and Exchange Commission’s rules and forms, and that information is accumulated and communicated to our management, including our principal executive and principal financial officer (whom we refer to in this periodic report as our Certifying Officer), as appropriate to allow timely decisions regarding required disclosure.  Our management evaluated, with the participation of our Certifying Officer, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act) as of December 31, 2009, pursuant to Rule 13a-15(b) under the Securities Exchange Act.  Based upon that evaluation, our Certifying Officer concluded that, as of December 31, 2009, our disclosure controls and procedures were effective.

There were no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
11


 
 

 

PART II – OTHER INFORMATION

ITEM 6.  EXHIBITS

The following exhibits are filed as a part of this report:

Exhibit Number*
 
Title of Document
 
Location
         
Item 31
 
Rule 13a-14(a)/15d-14(a) Certifications
   
31.01
 
Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Rule 13a-14
 
Attached
         
Item 32
 
Section 1350 Certifications
   
32.01
 
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer and Chief Financial Officer)
 
Attached
_______________
*
All exhibits are numbered with the number preceding the decimal indicating the applicable SEC reference number in Item 601 and the number following the decimal indicating the sequence of the particular document.


SIGNATURE

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.

 
GEO POINT TECHNOLOGIES, INC.
   
(Registrant)
     
     
     
Date: February 16, 2010
By:
/s/ William C. Lachmar
   
William C. Lachmar, President,
Chief Executive Officer, and
Chief Financial Officer

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