Attached files
file | filename |
---|---|
EX-32.1 - Savoy Energy Corp | v184178_ex32-1.htm |
EX-31.1 - Savoy Energy Corp | v184178_ex31-1.htm |
EX-31.2 - Savoy Energy Corp | v184178_ex31-2.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
10-Q
x
|
Quarterly
Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
For
the quarterly period ended March 31, 2010
|
|
¨
|
Transition
Report pursuant to 13 or 15(d) of the Securities Exchange Act of
1934
|
|
|
For
the transition period _________ to _________
|
|
Commission
File Number:
333-151960
|
Savoy
Energy Corporation
(Exact
name of small business issuer as specified in its charter)
Nevada
|
26-0429687
|
(State or other jurisdiction of incorporation or
organization)
|
(IRS Employer Identification No.)
|
11200
Westheimer, Suite 900
Houston,
TX 77042
(Address
of principal executive offices)
713.243.8788
(Issuer’s
telephone number)
(Former
name, former address and former fiscal year, if changed since last
report)
Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the issuer was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days x Yes ¨ No
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 (§ 229.405 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 ¨ No ¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.
¨
Large accelerated filer Accelerated filer
|
¨
Accelerated filer
|
¨
Non-accelerated filer
|
x
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 x
No
State the
number of shares outstanding of each of the issuer’s classes of common stock, as
of the latest practicable date: 55,146,000 common shares as of April 25,
2010.
TABLE OF CONTENTS
PART
I – FINANCIAL INFORMATION
|
||
Item
1:
|
Financial
Statements
|
3
|
Item
2:
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
17
|
Item
3:
|
Quantitative
and Qualitative Disclosures About Market Risk
|
20
|
Item
4T:
|
Controls
and Procedures
|
21
|
PART
II – OTHER INFORMATION
|
||
Item
1:
|
Legal
Proceedings
|
22
|
Item
1A:
|
Risk
Factors
|
23
|
Item
2:
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
23
|
Item
3:
|
Defaults
Upon Senior Securities
|
24
|
Item
4:
|
Submission
of Matters to a Vote of Security Holders
|
24
|
Item
5:
|
Other
Information
|
24
|
Item
6:
|
Exhibits
|
24
|
2
PART
I - FINANCIAL INFORMATION
Item
1. Financial Statements
Our
consolidated financial statements included in this Form 10-Q are as
follows:
Consolidated
Balance Sheets (unaudited) as of March 31, 2010 and December 31,
2009;
|
4
|
Consolidated
Statements of Operations (unaudited) for the three months ended March 31,
2010 and 2009;
|
5
|
Consolidated
Statements of Cash Flows (unaudited) for the three months ended March 31,
2010 and 2009;
|
6
|
Notes
to Consolidated Financial Statements (unaudited);
|
7
|
These
consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in the United States of America for
interim financial information and the SEC instructions to Form 10-Q and should
be read in conjunction with the audited financial statements and notes to
thereto contained in the Company’s annual report filed with the SEC on Form 10K
for the year ended December 31, 2009. In the opinion of management,
all adjustments consisting of normal recurring adjustments, considered necessary
for a fair presentation have been included. Operating results for the
interim period ended March 31, 2010 are not necessarily indicative of the
results that can be expected for the full year. Notes to the financial
statements which would substantially duplicate the disclosure contained in the
audited financial statements for the most recent year 2009 as reported in Form
10-K have been omitted.
3
SAVOY
ENERGY CORPORATION
CONSOLIDATED
BALANCE SHEETS
(Unaudited)
March 31,
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
ASSETS
|
||||||||
CURRENT
ASSETS
|
||||||||
Cash
and cash equivalents
|
$ | 18,341 | $ | 60,345 | ||||
Accounts
receivable
|
1,247 | 2,372 | ||||||
Total
current assets
|
19,588 | 62,717 | ||||||
OIL
AND GAS PROPERTIES, FULL COST METHOD
|
||||||||
Properties
subject to amortization
|
778,167 | 761,987 | ||||||
Accumulated
depletion, depreciation, amortization and impairment
|
(654,104 | ) | (650,813 | ) | ||||
Oil
and gas properties, net
|
124,063 | 111,174 | ||||||
TOTAL
ASSETS
|
$ | 143,651 | $ | 173,891 | ||||
LIABILITIES
AND STOCKHOLDERS’ DEFICIT
|
||||||||
CURRENT
LIABILITIES
|
||||||||
Accounts
payable and accrued liabilities
|
$ | 324,056 | $ | 354,088 | ||||
Advances
from related party
|
151,003 | 151,003 | ||||||
Accrued
interest payable
|
59,626 | 57,996 | ||||||
Notes
payable
|
470,000 | 447,500 | ||||||
Total
current liabilities
|
1,004,685 | 1,010,587 | ||||||
LONG-TERM
LIABILITIES
|
||||||||
Asset
retirement obligations
|
10,609 | 9,683 | ||||||
TOTAL
LIABILITIES
|
1,015,294 | 1,020,270 | ||||||
STOCKHOLDERS’
DEFICIT
|
||||||||
Common
stock, $.001 par value; 100,000,000 shares authorized,
|
||||||||
53,646,000
and 31,296,000 shares issued and outstanding, respectively
|
53,646 | 31,296 | ||||||
Additional
paid-in-capital
|
1,514,068 | 704,317 | ||||||
Accumulated
deficit
|
(2,439,357 | ) | (1,581,992 | ) | ||||
Total
stockholders’ deficit
|
(871,643 | ) | (846,379 | ) | ||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
$ | 143,651 | $ | 173,891 |
See notes
to consolidated financial statements
4
SAVOY
ENERGY CORPORATION
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three
|
For the Three
|
|||||||
Months Ended
|
Months Ended
|
|||||||
March 31,
|
March 31,
|
|||||||
2010
|
2009
|
|||||||
REVENUE
|
||||||||
Oil
and gas revenues
|
$ | 18,755 | $ | - | ||||
Total
revenues
|
18,755 | - | ||||||
COSTS
AND EXPENSES
|
||||||||
Lease
operating expenses
|
12,931 | - | ||||||
General
and administrative expenses
|
650,242 | 22,804 | ||||||
Depletion,
depreciation, amortization and impairment expense
|
3,291 | - | ||||||
Accretion
expense
|
926 | - | ||||||
Total
costs and expenses
|
667,390 | 22,804 | ||||||
Loss
from operations
|
(648,635 | ) | (22,804 | ) | ||||
OTHER
INCOME (EXPENSES)
|
||||||||
Interest
expense
|
(1,630 | ) | - | |||||
Loss
on settlement of debt
|
(207,100 | ) | - | |||||
Total
other income (expenses)
|
(208,730 | ) | - | |||||
Net
loss
|
$ | (857,365 | ) | $ | (22,804 | ) | ||
Basic
and diluted net loss per share
|
$ | (0.02 | ) | $ | (0.00 | ) | ||
Weighted
average common shares outstanding-basic and diluted
|
39,175,444 | 60,400,000 |
See notes
to consolidated financial statements
5
SAVOY
ENERGY CORPORATION
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three
|
For the Three
|
|||||||
Months
Ended
|
Months
Ended
|
|||||||
March 31,
|
March 31,
|
|||||||
2010
|
2009
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
loss
|
$ | (857,365 | ) | $ | (22,804 | ) | ||
Adjustments
to reconcile net loss to net
|
||||||||
cash
used in operating activities:
|
||||||||
Depletion,
depreciation, amortization and impairment
|
3,291 | - | ||||||
Accretion
expense
|
926 | - | ||||||
Stock
based compensation
|
524,000 | - | ||||||
Loss
on settlement of debt
|
207,100 | - | ||||||
Changes
in operating assets and liabilities
|
||||||||
Accounts
receivable
|
1,125 | - | ||||||
Accounts
payable and accrued liabilities
|
15,099 | 22,264 | ||||||
Net
cash used in operating activities
|
(105,824 | ) | (540 | ) | ||||
Cash
flows from investing activities:
|
||||||||
Purchase
of oil and gas properties
|
(16,180 | ) | - | |||||
Net
cash used in investment activities
|
(16,180 | ) | - | |||||
Cash
flows from financing activities:
|
||||||||
Proceeds
from issuance of debt
|
80,000 | - | ||||||
Net
cash provided by financing activities
|
80,000 | - | ||||||
Net
decrease in cash and cash equivalents
|
(42,004 | ) | (540 | ) | ||||
Cash
and cash equivalents, at beginning of period
|
60,345 | 540 | ||||||
Cash
and cash equivalents, at end of period
|
$ | 18,341 | $ | - | ||||
Supplemental
cash flow information:
|
||||||||
Cash
paid for interest
|
$ | - | $ | - | ||||
Cash
paid for income tax
|
$ | - | $ | - | ||||
Noncash
investing and financing activities:
|
||||||||
Common
stock issued for debt
|
$ | 57,500 | $ | - |
See notes
to consolidated financial statements
6
SAVOY
ENERGY CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH
31, 2010
(unaudited)
NOTE
1 - BASIS OF PRESENTATION
The
accompanying unaudited interim consolidated financial statements of Savoy Energy
Corporation ("the Company") have been prepared in accordance with accounting
principles generally accepted in the United States of America and the rules of
the Securities and Exchange Commission, and should be read in conjunction with
the audited financial statements and notes thereto contained in Savoy’s annual
report filed with the SEC on Forms 10-K for the year ended December 31,
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 financial statements which would substantially
duplicate the disclosure contained in the audited financial statements for the
most recent year 2009 as reported in Form 10-K have been omitted.
NOTE
2 – ORGANIZATION AND HISTORY
Savoy
Energy Corporation (the “Company”) was incorporated as “Arthur Kaplan Cosmetics,
Inc.” on June 25, 2007, in the State of Nevada. Our principal offices are
located at 11200 Westheimer, Suite 900, Houston, TX 77042 and our telephone
number is (713) 243-8788.
On March
31, 2009, we entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with Plantation Exploration, Inc., a privately held Texas
corporation (“Plantation Exploration”), and Plantation Exploration Acquisition,
Inc. (“Acquisition Sub”), our newly formed wholly-owned Nevada subsidiary. In
connection with the closing of this merger transaction, Acquisition Sub merged
with and into Plantation Exploration (the “Merger”) on April 2, 2009, with
the filing of articles of merger with the Texas Secretary of
State. As a result of the Merger, Plantation Acquisition no longer
exists and Plantation Exploration became our wholly-owned
subsidiary.
Subsequently,
on April 3, 2009, we merged with another wholly-owned subsidiary of our company,
known as Savoy Energy Corporation in a short-form merger transaction under
Nevada law and, in connection with this short form merger, changed our name to
Savoy Energy Corporation.
The
results of operations and cash flow for the period ended March 31, 2009 reflect
only the results of Arthur Kaplan Cosmetics, Inc., as the acquisition of
Plantation Exploration, Inc., Inc. occurred on April 2, 2009. The
following (unaudited) pro forma consolidated results of operations have been
prepared as if the acquisition of Plantation Exploration, Inc had occurred as of
the first day of the quarter ended March 31, 2009:
7
|
Three
Months
Ended March
31, 2009
|
|||
Total
revenues
|
$
|
15,464
|
||
Net
loss
|
(54,895
|
) | ||
Net
loss per share—Basic
|
(0.01
|
) | ||
Net
loss per share—Diluted
|
(0.01
|
) |
The pro
forma information is presented for informational purposes only and is not
necessarily indicative of the results of operations that actually would have
been achieved had the acquisition been consummated as of that time, nor is it
intended to be a projection of future results.
Effective
June 2, 2009, the Company’s board of directors approved a forward split of the
Company’s common stock on the basis of four shares for each share issued and
outstanding (4:1 split). The total number of authorized shares has not been
changed. The Company’s unaudited consolidated financial statements reflect the
stock split on a retro-active basis.
Certain
amounts in prior periods have been reclassified to conform to current period
presentation
NOTE
3 - SIGNIFICANT ACCOUNTING POLICIES
Use
of Estimates
The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
The
Company’s consolidated financial statements are based on a number of significant
estimates, including oil and gas reserve quantities which are the basis for the
calculation of depreciation, depletion and impairment of oil and gas properties,
and timing and costs associated with its retirement obligations.
Cash
and Cash Equivalents
Cash and
cash equivalents include cash in banks and financial instruments which mature
within three months of the date of purchase.
8
Debt
The
Company accounts for debt at the face amount of the debt offset by applicable
discounts and recognizes interest expense for accrued interest payable under the
terms of the debt. Principal and interest payments due within one year are
classified as current, whereas principal and interest payments for periods
beyond one year are classified as long term. Beneficial conversion features of
debt are valued and the related amounts recorded as discounts on the
debt. Discounts are amortized to interest expense using the effective
interest method over the term of the debt. Any unamortized discount
upon settlement or conversion of debt is recognized immediately as interest
expense.
Fair
Value of Financial Instruments
As of
March 31, 2010, the fair value of cash, accounts receivable, accounts payable
and notes payable approximate carrying values because of the short-term maturity
of these instruments.
Oil
and Gas Properties
The
Company follows the full cost method of accounting for its oil and natural gas
properties, whereby all costs incurred in connection with the acquisition,
exploration for and development of petroleum and natural gas reserves are
capitalized. Such costs include lease acquisition, geological and geophysical
activities, rentals on non-producing leases, drilling, completing and equipping
of oil and gas wells and administrative costs directly attributable to those
activities and asset retirement costs. Disposition of oil and gas properties are
accounted for as a reduction of capitalized costs, with no gain or loss
recognized unless such adjustment would significantly alter the relationship
between capital costs and proved reserves of oil and gas, in which case the gain
or loss is recognized to income.
Depletion
and depreciation of proved oil and gas properties is calculated on the
units-of-production method based upon estimates of proved reserves. Such
calculations include the estimated future costs to developed proved reserves.
Oil and gas reserves are converted to a common unit of measure based on the
energy content of 6,000 cubic feet of gas to one barrel of oil. Costs of
undeveloped properties are not included in the costs subject to depletion. These
costs are assessed periodically for impairment.
The fair
value of an asset retirement obligation is recognized in the period in which it
is incurred if a reasonable estimate of fair value can be made. The present
value of the estimated asset retirement costs is capitalized as part of the
carrying amount of the long-lived asset. For The Company, asset retirement
obligations (“ARO”) relate to the plugging and abandonment of drilled oil and
gas properties. The amounts recognized are based upon numerous estimates
including future retirement costs; future recoverable reserve quantities and
reserve lives; and the credit-adjusted risk-free interest rate.
9
Ceiling
test
In
applying the full cost method, The Company performs an impairment test (ceiling
test) at each reporting date, whereby the carrying value of property and
equipment is compared to the value of its proved reserves discounted at a
10-percent interest rate of future net revenues, based on current economic and
operating conditions, plus the cost of properties not being amortized, plus the
lower of cost or fair market value of unproved properties included in costs
being amortized, less the income tax effects related to book and tax basis
differences of the properties.
Oil and
gas properties, not subject to amortization
The
amortization of the oil and gas properties not classified as proved begins when
the oil and gas properties become proved, or their values become impaired. The
Company assesses the realizability of its properties not characterized as proved
on at least an annual basis or when there is or has been an indication that an
impairment in value may have occurred. The impairment of properties not
classified as proved is assessed based on management’s intention with regard to
future exploration and development of individually significant properties, and
the Company’s ability to secure capital funding to finance such exploration and
development. If the result of an assessment indicates that a property is
impaired, the amount of the impairment is added to the capitalized costs in its
full cost pool and they are amortized over production from proved
reserves
As of
March 31, 2010, the carrying value of all oil and gas properties were subject to
amortization. The Company has no carrying value for properties not subject to
amortization.
Revenue
Recognition
Revenues
from the sale of oil and natural gas are recognized when the product is
delivered at a fixed or determinable price, title has transferred, and
collectability is reasonably assured and evidenced by a contract. For oil
sales, this occurs when the customer's truck takes delivery of oil from the
operators’ storage tanks.
The
Company follows the “sales method” of accounting for oil and natural gas
revenue, so it recognizes revenue on all natural gas or crude oil sold to
purchasers, regardless of whether the sales are proportionate to its ownership
in the property. A receivable or liability is recognized only to the
extent that the Company has an imbalance on a specific property greater than its
share of the expected remaining proved reserves.
Costs
associated with production are expensed in the period incurred.
Stock-Based
Compensation
Stock-based
compensation expense includes the estimated fair value of equity awards vested
during the reporting period. The expense for equity awards vested during the
reporting period is determined based upon the grant date fair value of the award
and is recognized as expense over the applicable vesting period of the stock
award using the straight-line method.
10
Deferred
Taxes
Deferred
taxes are provided on the liability method whereby deferred tax assets are
recognized for deductible temporary differences and operating loss and tax
credit carry forwards and deferred tax liabilities are recognized for taxable
temporary differences. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax bases. 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. Deferred tax assets and accrued tax liabilities are
adjusted for the effects of changes in tax laws and rates on the date of
enactment.
Earnings
per Share of Common Stock
Basic net
income per share calculations are determined by dividing net income (loss) by
the weighted average number of common shares outstanding during the reporting
period. Diluted net income per share calculations are determined by
dividing net income (loss) by the weighted average number of common shares and
dilutive common share equivalents outstanding. During the reporting period when
they are anti-dilutive, common share equivalents, if any, are not considered in
the computation. No computation for diluted earnings per share was
prepared for the convertible debt (See Note 6) to issue 2,666,667 shares of
common stock at a conversion price of $0.03 per share that were outstanding
because the conversion would be anti-dilutive to diluted net loss per
share.
Recent
Accounting Pronouncements
The
Company does not expect recent accounting standards or interpretations issued or
recently adopted to have a material impact on the Company’s consolidated
financial position, operations or cash flows.
NOTE
4 - GOING CONCERN
The
Company’s consolidated financial statements are prepared using generally
accepted accounting principles applicable to a going concern which contemplates
the realization of assets and liquidation of liabilities in the normal course of
business. As of the date of this report, the Company has a working capital
deficit, has generated limited revenues and has an accumulated deficit. These
factors raise substantial doubt regarding the Company’s ability to continue as a
going concern.
In order
to continue as a going concern and achieve a profitable level of operations, the
Company will need, among other things, additional capital resources and to
develop a consistent source of revenues. The continuation of the Company as a
going concern is dependent upon the continued financial support from its
shareholders, the ability to raise equity or debt financing, and the attainment
of profitable operations from the Company's operations.
11
The
accompanying financial statements do not include any adjustments that might be
necessary if the Company is unable to continue as a going concern
NOTE
5 – OIL AND GAS PROPERTIES
During
February 2010 the Company secured a 2.75% working interest in an oil and gas
property in Sterling County, Texas for no consideration except to fund the
Company’s portion of the costs. During the three months ended March 31, 2010,
the Company paid $13,133 for its share of drilling costs. These costs were
capitalized as oil and gas properties at March 31, 2010.
NOTE
6 – NOTES PAYABLE
On
September 24, 2008 Plantation Exploration, Inc. entered into a financing
agreement with Oil Investment Leases, Inc. (OIL) for loans totaling $290,000. On
January 27, 2009 and May 4, 2009, the Company amended the September 24, 2008
agreement to assign the debt from Plantation Exploration to Savoy; the amended
agreements provided for total borrowings of $335,000 and $360,000, respectively,
due on demand. The interest is payable in-kind at 30,000 shares of common stock
of the Company on May 4, 2009 and 5,000 shares of common stock of the Company
for each month the debt remains unpaid. The Company has not issued the shares
for interest to OIL but has included the value of the shares to be issued in
accrued interest payable. During the three months ended March 31, 2010, the
Company repaid $57,500 of the outstanding balance at December 31, 2009 of
$360,000 via the issuance of shares to non-related third parties (see Note 9)
and as of March 31, 2010, the outstanding balance of due to OIL was $302,500. No
additional loans were made to the Company under this financing agreement during
the three months ended March 31, 2010.
On
December 17, 2009, the Company borrowed $37,500 from a non-related third party
bearing interest at 6% per annum. The loan is unsecured and the principal and
accrued and unpaid interest are payable at maturity on June 30, 2010. The
Company is using the proceeds for working capital. The outstanding balance
of $37,500 has been classified as current debt at March 31, 2010.
On
December 29, 2009, the Company borrowed $50,000 from a two non-related third
parties bearing interest at 5% per annum. The loans are unsecured and the
principal and accrued and unpaid interest are payable at maturity on June 30,
2010. The Company is using the proceeds for working capital. The
outstanding aggregate balance of $50,000 has been classified as current
debt at March 31, 2010.
12
On March
17, 2010, the Company borrowed $80,000 under two convertible promissory notes
from non-related third parties bearing interest at 5% per annum. The loans are
unsecured and the principal and accrued and unpaid interest are payable at
maturity on September 17, 2010. The Company is using the proceeds for working
capital. The outstanding balance of $80,000 has been classified as
current debt at March 31, 2010. At any time prior to the payment in
full of the entire balance of the notes, the lenders have the option of
converting all or any portion of the unpaid balance of the note into shares of
common stock at a conversion price equal to $0.03 per share, subject to
adjustment upon certain events. Assuming no adjustment to the
conversion price, if the lenders convert the entire principal balance of the
note, they would receive 2,666,667 shares of the Company’s common
stock. The Company evaluated the terms of the note and concluded that the notes
did not result in derivatives nor were there beneficial conversion features
since the notes were convertible into shares of common stock at the market value
of the common stock.
NOTE
7 – RELATED PARTY TRANSACTIONS
From time
to time, the Company receives cash advances from related parties, including
stockholders and their affiliates, to cover operating expenses. The advances do
not bear interest and are due upon demand. During the three months ended March
31, 2010, the Company received no additional cash advances. As of March 31,
2010, the outstanding balance of advances from related party was
$151,003.
NOTE
8 – STOCK OPTIONS AND WARRANTS
Summary
information regarding stock option activity is as follows:
Number of
Shares
|
Weighted
Average
Exercise
Price
|
|||||||
Outstanding
at 12/31/09
|
8,000,000
|
$
|
1.00
|
|||||
Granted
|
-
|
-
|
||||||
Exercised
|
-
|
-
|
||||||
Cancelled/Expired
|
-
|
-
|
||||||
Outstanding
at 03/31/10
|
8,000,000
|
$
|
1.00
|
Options
outstanding and their relative exercise price at March 31, 2010 are as
follows:
Exercise Price
|
Number of
shares
|
Remaining
life
|
Aggregate
Intrinsic Value
(In-the-money)
Options
|
||||||
$1.00
|
8,000,000
|
4.00 years
|
$
|
-
|
|||||
8,000,000
|
$
|
-
|
13
NOTE 9 - COMMON STOCK
On
February 1, 2010, the Company issued 800,000 common shares valued at $44,800,
based on the fair market value using quoted market prices on the date of grant
to Rio Sterling Holdings, LLC for payment on the Company’s note payable
with Oil Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a
loss of $32,300 on settlement of debt.
On
February 1, 2010, the Company issued 800,000 common shares valued at $44,800,
based on the fair market value using quoted market prices on the date of grant
to Barclay Lyons, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a loss of
$32,300 on settlement of debt.
On
February 1, 2010, the Company issued 1,250,000 common shares valued at $70,000,
based on the fair market value using quoted market prices on the date of grant
to Tombstone Capital, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a loss of
$57,500 on settlement of debt.
On March
4, 2010, the Company issued 10,000,000 common shares valued at $330,000, based
on the fair market value using quoted market prices on the date of grant to
Arthur Bertagnolli in satisfaction of accrued but unpaid compensation due to
Arthur Bertagnolli of $43,500 and recorded compensation expense of $286,500 in
the Company’s consolidated results of operations for the three months ended
March 31, 2010.
On March
4, 2010, the Company issued 2,000,000 common shares valued at $66,000, based on
the fair market value using quoted market prices on the date of grant to
Excelsus Capital Partners, LLC for services rendered. The value of
the shares were recognized in the Company’s consolidated results of operations
for the three months ended March 31, 2010.
On March
4, 2010, the Company issued 3,000,000 common shares valued at $99,000, based on
the fair market value using quoted market prices on the date of grant to
Excelsus Consulting, LLC for services rendered. The value of the
shares were recognized in the Company’s consolidated results of operations for
the three months ended March 31, 2010.
On March
4, 2010, the Company issued 500,000 common shares valued at $16,500, based on
the fair market value using quoted market prices on the date of grant to
Robert Diener, LLC for services rendered. The value of the shares
were recognized in the Company’s consolidated results of operations for the
three months ended March 31, 2010.
14
On March
18, 2010, the Company issued 1,500,000 common shares valued at $52,500, based on
the fair market value using quoted market prices on the date of grant to Rio
Sterling Holdings, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $10,000 and recorded a loss of
$42,500 on settlement of debt.
On March
18, 2010, the Company issued 1,500,000 common shares valued at $52,500, based on
the fair market value using quoted market prices on the date of grant to Barclay
Lyons, LLC for payment on the Company’s note payable with Oil Investment
Leases, Inc. (OIL) in the amount of $10,000 and recorded a loss of $42,500 on
settlement of debt.
NOTE
10 – COMMITMENTS, CONTINGENCIES AND LITIGATION
During
January 2010, the Company entered into a consulting agreement with an unrelated
third party and paid the consultant a commitment fee of $5,000 and issued the
consultant 1,000,000 fully vested shares of common stock (see Note 9). The
Company amended the consulting agreement in March 2010 that extended the term
for twelve months from the date of the amendment and issued the consultant
5,000,000 fully vested shares of common stock (2,000,000 shares on March 4, 2010
valued at $66,000 and 3,000,000 shares on March 4, 2010 valued at $99,000 – See
Note 9). As amended, the consulting agreement includes the following
commitments:
i.
|
|
The
consultant will receive $5,000 per month for twelve
months;
|
ii.
|
|
The
consultant will receive a referral fee of 10% cash and 10% equity of the
aggregate amount of each successful equity
financing;
|
iii.
|
|
The
consultant will receive a referral fee of 5% cash and 5% equity of the
aggregate amount of each successful debt
financing.
|
During
March 2010, the Company executed an investor relations agreement whereby the
Company agreed to pay an initial payment of $15,000 and 100,000 shares of the
Company’s common stock. The Company paid the $15,000 and has accrued the value
of the 100,000 common shares of $3,200, based on the fair market value using
quoted market prices on the date of grant. The Company has committed to pay the
consultant $15,000 per month for six months, automatically renewed for another
six months and thereafter renewable by mutual agreement.
The
Company’s Employment Agreement with Arthur Bertagnolli provides for certain
compensation and benefits based on Company output over and above base
compensation based on the Company’s achievement of specified
milestones. As of March 31, 2010, none of those milestones have been
achieved. Under certain circumstances, Mr. Bertagnolli is also
entitled to an additional payment upon sale of the Company to a larger
company.
15
Panos Industries, LLC v.
Savoy Energy Corporation, et. al., District Court, Clark County, Nevada Case #
A-10-612340-C.
On March
19, 2010, this action was filed in the above-entitled Court seeking damages “…in
excess of $50,000” based upon monies which the Plaintiff claims were advanced by
Plaintiff on behalf of the Company. This action is in its very early
stages and as of this date the Company has not been served with the Summons and
Complaint and has therefore not filed any Answer to the Complaint. While the
outcome of this matter cannot be predicted, the Company specifically denies that
it is indebted to Plaintiff and believes that any claims purportedly asserted in
the lawsuit are without merit. The Company further believes that it
has meritorious claims against Plaintiff which arose in connection with the
merger of the Company’s predecessor (Arthur Kaplan Cosmetics, Inc.) with
Plantation Exploration, Inc. and in connection with the aftermath of the
merger. The Company intends to vigorously defend any claims asserted
by the Plaintiff and to aggressively prosecute its claims against the
Plaintiff. Even if the Company is ultimately successful in defending
this action, it will incur legal fees and other expenses in connection with such
defense, the amount of which cannot be predicted at this time. Such
expenses could have a material impact on the Company’s future operating results
and have an adverse impact on the Company’s funds available for its
operations.
NOTE
11 – SUBSEQUENT EVENTS
On April
15, 2010, the Company issued 1,500,000 common shares valued at $45,000, based on
the fair market value using quoted market prices on the date of grant to Rio
Sterling Holdings, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $10,000 and recorded a realized
loss of $35,000 on settlement of debt.
16
Item
2. Management’s Discussion and Analysis or Plan of
Operation
Forward-Looking
Statements
Certain
statements, 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 “believes,” “project,” “expects,” “anticipates,” “estimates,”
“intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will
continue,” “will likely result,” and similar expressions. We intend
such forward-looking statements to be covered by the safe-harbor provisions for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995, and are including this statement for purposes of complying with
those safe-harbor provisions. 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. Our ability to predict results or the actual effect of future plans
or strategies is inherently uncertain. Factors which could have a
material adverse affect on our operations and future prospects on a consolidated
basis include, but are not limited to: changes in economic conditions,
legislative/regulatory changes, availability of capital, interest rates,
competition, and generally accepted accounting principles. These risks and
uncertainties should also be considered in evaluating forward-looking statements
and undue reliance should not be placed on such statements. We undertake no
obligation to update or revise publicly any forward-looking statements, whether
as a result of new information, future events or otherwise. Further
information concerning our business, including additional factors that could
materially affect our financial results, is included herein and in our other
filings with the SEC.
Overview
We are in
the business of re-entering, re-completing, extracting oil, and selling oil from
previously drilled wells in the United States. Our plan of operations is to
economically extract a significant amount of the “left-behind” oil from
previously drilled sites.
We
currently hold leases on and are producing oil from the following wells: our
working interests in Ali-O No.1, Rozella Kifer No. 1, Zavadil No.1, our 8.6%
overriding royalty interest in Team Bank, our 2.0% overriding royalty interest
in Henry E. –A- #1 Christian, our 1.0% overriding royalty interest in Mary
Martha #1, and our 5.0% overriding royalty interest in W.L. Barnett ET AL #1
& #2. We also own a 2.75% working interest in the Glass 59 #2 well. We
will continue our workover efforts on these wells, and seek to duplicate our
successful efforts with other wells. We have retained Forrest A. Garb &
Associates, a petroleum consulting firm specializing in geological analyses of
oil wells, to work with us to locate and screen a number of abandoned oil wells
prospects for viability. Our evaluations include an assessment of
production potential of each well using geological evaluations including the use
of seismic data as available. In addition to the four wells that we are
currently have in operation, we have also already identified 34 other wells as
targets for acquisition: six that are producing and 28 that have been abandoned
but have seismic or other data indicating that they are favorable candidates for
recompletion or workover.
17
Once we
have determined which wells have the greatest production potential and are most
likely to respond to our workover efforts, we will then pursue acquiring
interests in those wells. We will then engage in workover operations as with our
previous wells, primarily through horizontal drilling and acidization. We hope
to extract and sell crude oil through a third party purchaser.
Our
strategy is to concentrate on existing low maintenance production, exploit low
risk sidetrack drilling opportunities as and when identified, and use the
accumulated information and results to advance operations.
Large oil
companies with high overhead costs require high production rates for wells to be
economically viable. Our small size and lower overhead allows profitably
extraction of oil at low production rates. Our goal is to turn wells rendered
uneconomical and abandoned by large companies into profitable ones.
We
continue to find ways to reduce expenses and increase efficiency. Recently,
decisions were made to convert all applicable wells to operate on electricity.
The Company believes that electricity is cheaper as an energy source and also
electric motors have lower maintenance expenses than gas-operated engines. To
further this end, plans were made to install the “Jack Shaft Reducer” on our
Rozella Kifer Well. The Jack Shaft Reducer is expected to both increase
efficiency and decrease maintenance costs which will in turn extend the life of
the well’s production, although this cannot be quantified at this
time.
On March
27, 2010 the Zavadil #1 well was placed online and closely monitored under full
electric power. This is the second producing well that the Company has operating
under full electric power. The Company will now begin the
process to convert its Ali-O #1 oil well to operate under full electric
power.
Developments
in Expansion of Wells
We signed
a letter of intent to acquire 100% of the working interest in the Wright Well in
Gonzalez County, Texas from Lucas Energy, Inc., an independent crude oil and gas
company. The letter of intent has expired, however, as of the date of this
report negotiations are continuing to purchase a 100% interest in the well. No
definitive agreements have been signed to date, but we are continuing to pursue
the proposed transaction.
18
We signed
a participation agreement with Paragon Petroleum, Inc., an independent crude oil
and gas company, in the Glass 59 #2 well which has been recently completed. The
completion data from Bright & Co., the operator has increased from
anticipated production to initial production levels of 53 bopd of oil and 858
mcf of gas.
Results
of Operations for the Three Months Ended March 31, 2010 and 2009
Revenues.
Our total revenue reported for the three months ended March 31, 2010 was
$18,755. The increase was due to the acquisition of Plantation Exploration, Inc.
on April 2, 2009.
Lease Operating
Expenses. The lease operating expenses for the three months
ended March 31, 2010 was $12,931. The increase was due to the acquisition of
Plantation Exploration, Inc. on April 2, 2009.
Depreciation,
Depletion, Amortization and Impairment. Depreciation,
depletion, amortization and impairment for the three months ended March 31, 2010
was $3,291. The increase was due to the acquisition of Plantation Exploration,
Inc. on April 2, 2009. The net carrying values of our oil and gas
properties in increased at March 31, 2010 to $124,063 as compared to $111,174 at
December 31, 2009. We had no impairment in the three months ended
March 31, 2010.
General and
Administrative Expense. General and administrative expense for
the three months ended March 31, 2010 increased to $650,242 from $22,804 for the
comparable quarter in 2009 of $33,406. The increase in general and
administrative expense was largely attributable to the recognition of stock
compensation expense. Stock was issued for services during the quarter ended
March 31, 2010 versus none in the comparable quarter of
2009.
Other Income
(Expenses). We recorded interest expenses of $1,630 for the three months
ended March 31, 2010. The increase was due to the acquisition of
Plantation Exploration, Inc. on April 2, 2009. We also recorded a
loss on the settlement of a debt of $207,100 with Oil Investment Leases, Inc. as
a result of the repayment of a portion of our debt with common shares that had a
greater fair value than the amount of debt settled.
Liquidity
and Capital Resources
As of
March 31, 2010, we had total current assets of $19,588. Our total current
liabilities as of March 31, 2010 were $1,004,685. Thus, we had a
working capital deficit of $985,097 as of March 31, 2010.
Operating
activities used $105,824 in cash for the three months ended March 31, 2010. Our
net loss of $857,365 was the primary component of our negative operating cash
flow, offset by non-cash expenses—common stock-based compensation and loss on
the settlement of a debt. Cash flows used in investing activities were $16,180
during the quarter ended March 31, 2010 compared to $0 in the comparable quarter
the prior year related to the acquisition of oil and gas interests. Cash flows
provided by financing activities during the quarter ended March 31, 2010 was
$80,000 consisting of proceeds from notes payable of $80,000. All repayments of
notes payable were non-cash repayments accomplished via the issuance of the
Company’s common stock.
19
Based
upon our current financial condition, we do not have sufficient cash to operate
our business at the current level for the next twelve months. We have negative
working capital and rely on investments and loans to fund our
operations. We intend to fund operations through increased sales and
debt and/or equity financing arrangements, which may be insufficient to fund
expenditures or other cash requirements. We plan to seek additional financing in
a private equity offering to secure funding for operations. There can be no
assurance that we will be successful in raising additional funding. If we are
not able to secure additional funding, the implementation of our business plan
will be impaired. There can be no assurance that such additional financing will
be available to us on acceptable terms or at all.
Going Concern
Our
financial statements are prepared using generally accepted accounting principles
applicable to a going concern which contemplates the realization of assets and
liquidation of liabilities in the normal course of business. As of
the date of this report, we have generated losses from operations, have an
accumulated deficit and a working capital deficiency. These factors raise
substantial doubt regarding our ability to continue as a going
concern.
In order
to continue as a going concern and achieve a profitable level of operations, we
will need, among other things, additional capital resources and to develop a
consistent source of revenues. Our continuation as a going concern is
dependent upon the continued financial support from our shareholders, the
ability to raise equity or debt financing, and the attainment of profitable
operations from our planned business.
Our
ability to continue as a going concern is dependent upon our ability to
successfully accomplish the plan described in the preceding paragraph and
eventually attain profitable operations. The accompanying financial
statements do not include any adjustments that might be necessary if we are
unable to continue as a going concern.
Off
Balance Sheet Arrangements
As of
March 31, 2010, there were no off balance sheet arrangements.
Item
3. Quantitative and Qualitative Disclosures About
Market Risk
A smaller
reporting company is not required to provide the information required by this
Item.
20
Item
4T. Controls and Procedures
We
carried out an evaluation of the effectiveness of the design and operation of
our disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) as of March 31, 2010. The Company's
internal control over financial reporting is a process and procedures designed
under the supervision of the Company's Principal Executive Officer and Principal
Financial Officer to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of the Company's financial statements
for external purposes in accordance with U.S. generally accepted accounting
principles.
Based
upon that evaluation, our Chief Executive Officer who is also our Principal
Financial Officer concluded that, as of March 31, 2010, our disclosure controls
and procedures over financing reporting were not effective. This
conclusion was based on the existence of the material weaknesses in our internal
control over financial reporting previously disclosed and discussed below. There
have been no changes in our internal controls over financial reporting during
the quarter ended March 31, 2010. To address the need for more
effective internal controls, management has plans to improve the existing
controls and implement new controls as our financial position and capital
availability improves. Disclosure controls and procedures are
controls and other procedures that are designed to ensure that information
required to be disclosed in our reports filed or submitted under the Exchange
Act are recorded, processed, summarized and reported, within the time periods
specified in the SEC's rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed under the Exchange Act is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, to allow timely decisions regarding required
disclosure.
A
material weakness is a deficiency, or a combination of deficiencies, in internal
control over financial reporting, such that there is a reasonable possibility
that a material misstatement of the company’s annual or interim financial
statements will not be prevented or detected on a timely basis.
We
identified and continue to have the following material weakness in our internal
controls over financial reporting:
There is
a lack of segregation of duties and technical accounting expertise. Our
financial reporting and all accounting functions are performed by an external
consultant with no oversight by a professional with accounting expertise.
Our management does not possess accounting expertise and hence our controls over
the selection and application of accounting policies in accordance with
generally accepted accounting principles were inadequate and constitute a
material weakness in the design of internal control over financial
reporting. This weakness is due to the Company’s lack of working capital
to hire additional staff.
Limitations
on the Effectiveness of Internal Controls
21
Our
management does not expect that our disclosure controls and procedures or our
internal control over financial reporting will necessarily prevent all fraud and
material error. Our disclosure controls and procedures are designed to provide
reasonable assurance of achieving our objectives and our Chief Executive Officer
and Chief Financial Officer concluded that our disclosure controls and
procedures are effective at that reasonable assurance level. Further,
the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within the Company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
internal control. The design of any system of controls also is based in part
upon certain assumptions about the likelihood of future events, and there can be
no assurance that any design will succeed in achieving its stated goals under
all potential future conditions. Over time, control may become inadequate
because of changes in conditions, or the degree of compliance with the policies
or procedures may deteriorate.
PART
II – OTHER INFORMATION
Item
1. Legal Proceedings
The
Company is a party to the following litigation:
Panos Industries, LLC v.
Savoy Energy Corporation, et. al., District Court, Clark County, Nevada Case #
A-10-612340-C.
On March
19, 2010, this action was filed in the above-entitled Court seeking damages “…in
excess of $50,000” based upon monies which the Plaintiff claims were advanced by
Plaintiff on behalf of the Company. This action is in its very early
stages and as of this date the Company has not been served with the Summons and
Complaint and has therefore not filed any Answer to the Complaint. While the
outcome of this matter cannot be predicted, the Company specifically denies that
it is indebted to Plaintiff and believes that any claims purportedly asserted in
the lawsuit are without merit. The Company further believes that it
has meritorious claims against Plaintiff which arose in connection with the
merger of the Company’s predecessor (Arthur Kaplan Cosmetics, Inc.) with
Plantation Exploration, Inc. and in connection with the aftermath of the
merger. The Company intends to vigorously defend any claims asserted
by the Plaintiff and to aggressively prosecute its claims against the
Plaintiff. Even if the Company is ultimately successful in defending
this action, it will incur legal fees and other expenses in connection with such
defense, the amount of which cannot be predicted at this time. Such
expenses could have a material impact on the Company’s future operating results
and have an adverse impact on the Company’s funds available for its
operations.
22
Item
1A: Risk Factors
A smaller
reporting company is not required to provide the information required by this
Item.
Item
2. Unregistered Sales of Equity Securities and Use
of Proceeds
On
January 26, 2010, the Company issued 1,000,000 common shares valued at $56,000,
based on the fair market value using quoted market prices on the date of grant
to Excelsus Capital Partners, LLC for services rendered. The value of
the shares were recognized in the Company’s consolidated results of operations
for the three months ended March 31, 2010.
On
February 1, 2010, the Company issued 800,000 common shares valued at $44,800,
based on the fair market value using quoted market prices on the date of grant
to Rio Sterling Holdings, LLC for payment on the Company’s note payable
with Oil Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a
loss of $32,300 on settlement of debt.
On
February 1, 2010, the Company issued 800,000 common shares valued at $44,800,
based on the fair market value using quoted market prices on the date of grant
to Barclay Lyons, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a loss of
$32,300 on settlement of debt.
On
February 1, 2010, the Company issued 1,250,000 common shares valued at $70,000,
based on the fair market value using quoted market prices on the date of grant
to Tombstone Capital, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $12,500 and recorded a loss of
$57,500 on settlement of debt.
On March
4, 2010, the Company issued 10,000,000 common shares valued at $330,000, based
on the fair market value using quoted market prices on the date of grant to
Arthur Bertagnolli in satisfaction of accrued but unpaid compensation due to
Arthur Bertagnolli of $43,500 and recorded compensation expense of $286,500 in
the Company’s consolidated results of operations for the three months ended
March 31, 2010.
On March
4, 2010, the Company issued 2,000,000 common shares valued at $66,000, based on
the fair market value using quoted market prices on the date of grant to
Excelsus Capital Partners, LLC for services rendered. The value of
the shares were recognized in the Company’s consolidated results of operations
for the three months ended March 31, 2010.
On March
4, 2010, the Company issued 3,000,000 common shares valued at $99,000, based on
the fair market value using quoted market prices on the date of grant to
Excelsus Consulting, LLC for services rendered. The value of the
shares were recognized in the Company’s consolidated results of operations for
the three months ended March 31, 2010.
23
On March
4, 2010, the Company issued 500,000 common shares valued at $16,500, based on
the fair market value using quoted market prices on the date of grant to
Robert Diener, LLC for services rendered. The value of the shares
were recognized in the Company’s consolidated results of operations for the
three months ended March 31, 2010.
On March
18, 2010, the Company issued 1,500,000 common shares valued at $52,500, based on
the fair market value using quoted market prices on the date of grant to Rio
Sterling Holdings, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $10,000 and recorded a loss of
$42,500 on settlement of debt.
On March
18, 2010, the Company issued 1,500,000 common shares valued at $52,500, based on
the fair market value using quoted market prices on the date of grant to Barclay
Lyons, LLC for payment on the Company’s note payable with Oil Investment
Leases, Inc. (OIL) in the amount of $10,000 and recorded a loss of $42,500 on
settlement of debt.
On April
15, 2010, the Company issued 1,500,000 common shares valued at $45,000, based on
the fair market value using quoted market prices on the date of grant to Rio
Sterling Holdings, LLC for payment on the Company’s note payable with Oil
Investment Leases, Inc. (OIL) in the amount of $10,000 and will record a
realized loss of $35,000 on settlement of debt.
The above
issuances were performed in reliance on the exemption from registration afforded
by Section 4(2) of the Securities Act.
Item
3. Defaults upon Senior Securities
None
Item
4. Submission of Matters to a Vote of Security
Holders
None
Item
5. Other Information
None
Item
6. Exhibits
24
Exhibit
Number
|
Description of Exhibit
|
|
31.1
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
32.1
|
Certification
of Chief Executive Officer and Chief Financial Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of
2002
|
SIGNATURES
In
accordance with the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SAVOY
ENERGY CORPORATION
|
|||
Date:
|
May
10, 2010
|
||
By:
|
/s/
Arthur Bertagnolli
|
||
Arthur
Bertagnolli
|
|||
Title:
|
Chief
Executive Officer and Chief Financial
Officer
|
25