Attached files
| file | filename |
|---|---|
| EX-31.1 - CERTIFICATIONS PURSUANT TO SECTION 302 OF SARBANES OXLEY ACT OF 2002 - NEXT FUEL, INC. | f10q1210ex31i_nextfuel.htm |
| EX-32.1 - CERTIFICATIONS PURSUANT TO SECTION 906 OF SARBANES OXLEY ACT OF 2002 - NEXT FUEL, INC. | f10q1210ex32i_nextfuel.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 December 31, 2010
o 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: 333-148493
NEXT FUEL, INC.
(Exact name of registrant as specified in it's charter)
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NEVADA
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||
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employee Identification No.)
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210 Walford Way, Cary, North Carolina 27519
(Address of Principal Executive Offices)
_______________
(919) 414-1458
(Issuer Telephone number)
_______________
(Former Name or Former Address if Changed Since Last Report)
Indicate by check mark 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 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 filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):
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Large Accelerated Filer o
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Accelerated Filer o
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Non-Accelerated Filer o
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Smaller Reporting Company x
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Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act.
Yes x No o
State the number of shares issued and outstanding of each of the issuer’s classes of common equity, as of February 10, 2011: 7,087,500 shares of issued common stock.
NEXT FUEL, INC.
FORM 10-Q
December 31, 2010
INDEX
PART I-- FINANCIAL INFORMATION
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Item 1.
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Financial Statements
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1
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Item 2.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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11
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Item 3
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Quantitative and Qualitative Disclosures About Market Risk
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13
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Item 4T.
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Control and Procedures
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13
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PART II-- OTHER INFORMATION
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Item 1
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Legal Proceedings
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14
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Item 1A
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Risk Factors
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14
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Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
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14
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Item 3.
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Defaults Upon Senior Securities
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14
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Item 4.
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Removed and Reserved
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14
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Item 5.
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Other Information
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14
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Item 6.
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Exhibits
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14
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SIGNATURE
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
CONTENTS
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PAGE
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1
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CONDENSED BALANCE SHEETS AS OF DECEMBER 31, 2010 (UNAUDITED) AND AS OF SEPTEMBER 30, 2010.
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PAGE
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2
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CONDENSED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2010 AND 2009 (UNAUDITED), AND FOR THE PERIOD FROM AUGUST 14, 2007 (INCEPTION) TO DECEMBER 31, 2010 (UNAUDITED).
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PAGE
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3
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CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY/DEFICIENCY FOR THE PERIOD FROM AUGUST 14, 2007 (INCEPTION) TO DECEMBER 31, 2010 (UNAUDITED).
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PAGE
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4
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CONDENSED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED DECEMBER 31, 2010 AND 2009 (UNAUDITED), AND FOR THE PERIOD FROM AUGUST 14, 2007 (INCEPTION) TO DECEMBER 31, 2010 (UNAUDITED).
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PAGES
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5 - 10
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NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED).
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Next Fuel, Inc.
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||||||||
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(F/k/a Clinical Trials of the Americas, Inc.)
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||||||||
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(A Development Stage Company)
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||||||||
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Condensed Balance Sheets
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||||||||
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ASSETS
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||||||||
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December 31,
2010
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September 30,
2010
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|||||||
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(Unaudited)
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||||||||
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Current Assets
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||||||||
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Cash
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$ | - | $ | - | ||||
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Total Current Assets
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- | - | ||||||
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Property and Equipment, net
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2,126 | 2,373 | ||||||
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Total Assets
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$ | 2,126 | $ | 2,373 | ||||
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LIABILITIES AND STOCKHOLDERS' DEFICIENCY
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||||||||
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Current Liabilities
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||||||||
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Accounts Payable
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$ | 15,558 | $ | 10,790 | ||||
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Loan Payable
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285,750 | 285,750 | ||||||
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Total Liabilities
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301,308 | 296,540 | ||||||
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Commitments and Contingencies
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- | - | ||||||
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Stockholders' Deficiency
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||||||||
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Preferred stock, $0.0001 par value; 100,000,000 shares authorized,
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||||||||
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none issued and outstanding
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- | - | ||||||
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Common stock, $0.0001 par value; 100,000,000 shares authorized, 7,087,500 and 7,037,500
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||||||||
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issued and outstanding, respectively
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708 | 703 | ||||||
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Additional paid-in capital
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274,278 | 261,571 | ||||||
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Less: Treasury stock; 2,500,000 and 2,500,000, respectively
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(93,000 | ) | (93,000 | ) | ||||
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Deficit accumulated during the development stage
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(481,168 | ) | (463,441 | ) | ||||
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Total Stockholders' Deficiency
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(299,182 | ) | (294,167 | ) | ||||
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Total Liabilities and Stockholders' Deficiency
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$ | 2,126 | $ | 2,373 | ||||
See accompanying notes to condensed unaudited financial statements
1
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Next Fuel, Inc.
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||||||||||||
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(F/k/a Clinical Trials of the Americas, Inc.)
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||||||||||||
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(A Development Stage Company)
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||||||||||||
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Condensed Statements of Operations
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||||||||||||
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(Unaudited)
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||||||||||||
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For the Three Months Ended December 31,
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For the Period from August 14,
2007
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|||||||||||
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2010
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2009
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(Inception) to December 31,
2010
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||||||||||
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Operating Expenses
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||||||||||||
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Professional fees
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$ | 8,701 | $ | 5,625 | $ | 377,965 | ||||||
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General and administrative
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2,614 | 2,232 | 55,160 | |||||||||
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Total Operating Expenses
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11,315 | 7,857 | 433,125 | |||||||||
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Loss from Operations
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(11,315 | ) | (7,857 | ) | (433,125 | ) | ||||||
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Other Expenses
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||||||||||||
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Interest Expense
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(6,412 | ) | (6,482 | ) | (48,043 | ) | ||||||
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LOSS FROM OPERATIONS BEFORE INCOME TAXES
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(17,727 | ) | (14,339 | ) | (481,168 | ) | ||||||
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Provision for Income Taxes
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- | - | - | |||||||||
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NET LOSS
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$ | (17,727 | ) | $ | (14,339 | ) | $ | (481,168 | ) | |||
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Net Loss Per Share - Basic and Diluted
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$ | (0.00 | ) | $ | (0.00 | ) | ||||||
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Weighted average number of shares outstanding
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||||||||||||
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during the year - Basic and Diluted
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7,080,357 | 6,774,457 | ||||||||||
See accompanying notes to condensed unaudited financial statements
2
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Next Fuel, Inc.
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||||||||||||||||||||||||||||||||||||
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(F/k/a Clinical Trials of the Americas, Inc.)
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(A Development Stage Company)
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||||||||||||||||||||||||||||||||||||
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Condensed Statement of Changes in Stockholders' Equity/(Deficiency)
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||||||||||||||||||||||||||||||||||||
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For the period from August 14, 2007 (Inception) to December 31, 2010
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||||||||||||||||||||||||||||||||||||
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(Unaudited)
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||||||||||||||||||||||||||||||||||||
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Deficit
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||||||||||||||||||||||||||||||||||||
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Preferred Stock
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Common stock
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accumulated
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Total
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|||||||||||||||||||||||||||||||||
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Additional
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during the |
Stockholder's
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||||||||||||||||||||||||||||||||||
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Shares
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Amount
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Shares
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Amount
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paid-in
capital |
Treasury
Stock |
development
stage |
Subscription
Receivable |
Equity/(Deficiency)
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||||||||||||||||||||||||||||
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Balance August 14, 2007
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- | $ | - | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||||
| - | ||||||||||||||||||||||||||||||||||||
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Common stock issued for services to founder ($0.0001)
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- | - | 5,000,000 | 500 | - | - | - | - | 500 | |||||||||||||||||||||||||||
| - | ||||||||||||||||||||||||||||||||||||
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Common stock issued for cash ($0.10/ per share)
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- | - | 1,240,000 | 124 | 123,876 | - | - | (85,000 | ) | 39,000 | ||||||||||||||||||||||||||
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In kind contribution of cash
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- | - | - | - | 100 | - | - | - | 100 | |||||||||||||||||||||||||||
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In kind contribution of services
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- | - | - | - | 700 | - | - | - | 700 | |||||||||||||||||||||||||||
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Net loss for the period August 14, 2007 (inception) to September 30, 2007
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- | - | - | - | - | - | (12,300 | ) | - | (12,300 | ) | |||||||||||||||||||||||||
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Balance, for the year ended September 30, 2007
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- | - | 6,240,000 | 624 | 124,676 | - | (12,300 | ) | (85,000 | ) | 28,000 | |||||||||||||||||||||||||
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Common stock issued for cash ($0.10/ per share)
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- | - | 197,500 | 20 | 19,730 | - | - | - | 19,750 | |||||||||||||||||||||||||||
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Purchase of treasury stock
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- | - | - | - | - | (40,000 | ) | - | - | (40,000 | ) | |||||||||||||||||||||||||
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Cash received for subscription receivable
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- | - | - | - | - | - | - | 85,000 | 85,000 | |||||||||||||||||||||||||||
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In kind contribution of services
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- | - | - | - | 5,200 | - | - | - | 5,200 | |||||||||||||||||||||||||||
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Net loss for the year ended September 30, 2008
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- | - | - | - | - | - | (204,665 | ) | - | (204,665 | ) | |||||||||||||||||||||||||
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Balance, for the year ended September 30, 2008
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- | - | 6,437,500 | 644 | 149,606 | (40,000 | ) | (216,965 | ) | - | (106,715 | ) | ||||||||||||||||||||||||
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Common stock issued for cash ($0.10/ per share)
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- | - | 275,000 | 27 | 27,473 | - | - | - | 27,500 | |||||||||||||||||||||||||||
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Purchase of treasury stock
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- | - | - | - | - | (53,000 | ) | - | - | (53,000 | ) | |||||||||||||||||||||||||
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In kind contribution of interest
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- | - | - | - | 16,118 | - | - | - | 16,118 | |||||||||||||||||||||||||||
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In kind contribution of services
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- | - | - | - | 5,200 | - | - | - | 5,200 | |||||||||||||||||||||||||||
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Net loss for the year ended September 30, 2009
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- | - | - | - | - | - | (181,654 | ) | - | (181,654 | ) | |||||||||||||||||||||||||
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Balance, September 30, 2009
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- | - | 6,712,500 | 671 | 198,397 | (93,000 | ) | (398,619 | ) | - | (292,551 | ) | ||||||||||||||||||||||||
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Common stock issued for cash ($0.10/ per share)
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- | - | 325,000 | 32 | 32,468 | - | - | - | 32,500 | |||||||||||||||||||||||||||
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In kind contribution of interest
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- | - | - | - | 25,506 | - | - | - | 25,506 | |||||||||||||||||||||||||||
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In kind contribution of services
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- | - | - | - | 5,200 | - | - | - | 5,200 | |||||||||||||||||||||||||||
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Net loss for the year ended September 30, 2010
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- | - | - | - | - | - | (64,822 | ) | - | (64,822 | ) | |||||||||||||||||||||||||
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Balance, September 30, 2010
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- | - | 7,037,500 | 703 | 261,571 | (93,000 | ) | (463,441 | ) | - | (294,167 | ) | ||||||||||||||||||||||||
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Common stock issued for cash ($0.10/ per share)
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- | - | 50,000 | 5 | 4,995 | - | - | - | 5,000 | |||||||||||||||||||||||||||
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In kind contribution of interest
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- | - | - | - | 6,412 | - | - | - | 6,412 | |||||||||||||||||||||||||||
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In kind contribution of services
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- | - | - | - | 1,300 | - | - | - | 1,300 | |||||||||||||||||||||||||||
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Net loss for the period ended December 31, 2010
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- | - | - | - | - | - | (17,727 | ) | - | (17,727 | ) | |||||||||||||||||||||||||
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Balance, December 31, 2010
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- | $ | - | 7,087,500 | $ | 708 | $ | 274,278 | $ | (93,000 | ) | $ | (481,168 | ) | $ | - | $ | (299,182 | ) | |||||||||||||||||
See accompanying notes to condensed unaudited financial statements
3
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Next Fuel, Inc.
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(F/k/a Clinical Trials of the Americas, Inc.)
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(A Development Stage Company)
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Condensed Statements of Cash Flows
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||||||||||||
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(Unaudited)
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||||||||||||
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For the Three Months Ended December 31,
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For the Period From August 14,
2007
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|||||||||||
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2010
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2009
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(Inception) to December 31,
2010
|
||||||||||
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Cash Flows Used In Operating Activities:
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||||||||||||
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Net Loss
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$ | (17,727 | ) | $ | (14,339 | ) | $ | (481,168 | ) | |||
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Adjustments to reconcile net loss to net cash used in operations
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||||||||||||
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Common stock issued for services
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- | - | 500 | |||||||||
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In-kind contribution of services
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1,300 | 1,300 | 17,600 | |||||||||
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In-kind contribution of interest
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6,412 | 6,483 | 48,036 | |||||||||
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Depreciation expense
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247 | 247 | 2,782 | |||||||||
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Changes in operating assets and liabilities:
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||||||||||||
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Increase (Decrease) in accounts payable and accrued expenses
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4,768 | (3,590 | ) | 15,558 | ||||||||
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Net Cash Used In Operating Activities
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(5,000 | ) | (9,899 | ) | (396,692 | ) | ||||||
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Cash Flows From Investing Activities:
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||||||||||||
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Purchase of Fixed Assets
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- | - | (4,908 | ) | ||||||||
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Net Cash Used In Investing Activities
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- | - | (4,908 | ) | ||||||||
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Cash Flows From Financing Activities:
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||||||||||||
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Proceeds from loan payable
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- | - | 325,750 | |||||||||
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Repayments of loan payable
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- | - | (40,000 | ) | ||||||||
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Purchase of treasury stock
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- | - | (93,000 | ) | ||||||||
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Proceeds from issuance of common stock
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5,000 | 10,000 | 208,850 | |||||||||
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Net Cash Provided by Financing Activities
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5,000 | 10,000 | 401,600 | |||||||||
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Net Increase in Cash
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- | 101 | - | |||||||||
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Cash at Beginning of Year/Period
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- | 79 | - | |||||||||
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Cash at End of Year/Period
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$ | - | $ | 180 | $ | - | ||||||
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Supplemental disclosure of cash flow information:
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||||||||||||
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Cash paid for interest
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$ | - | $ | - | $ | - | ||||||
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Cash paid for taxes
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$ | - | $ | - | $ | 127 | ||||||
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Supplemental disclosure of non-cash investing and financing activities:
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||||||||||||
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Stock issued in exchange for subscription receivable
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$ | - | $ | - | $ | - | ||||||
See accompanying notes to condensed unaudited financial statements
4
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
(A) Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.
It is management's opinion, however that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statements presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.
Clinical Trials of the Americas, Inc. (a development stage company) (the "Company") was incorporated under the laws of the State of Nevada on August 14, 2007. Clinical Trials of the Americas, Inc. is a service-based firm that will provide clinical trial investigator services to pharmaceutical companies throughout the Americas.
On May 29, 2009, in connection with the letter of intent with Next Fuel, Inc., the Company filed a Certificate of Amendment to the Articles of Incorporation changing the Company’s name to Next Fuel, Inc. (see Note 8).
Activities during the development stage include developing the business plan and raising capital.
(B) Use of Estimates
In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates.
(C) Cash and Cash Equivalents
The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At December 31, 2010 and 2009, respectively, the Company had no cash equivalents.
5
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
(D) Loss Per Share
Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by FASB Accounting Standards Codification Topic 260, “Earnings Per Share.” As of December 31, 2010 and 2009, respectively, there were no common share equivalents outstanding.
(E) Property and Equipment
The Company values property and equipment at cost and depreciates these assets using the straight-line method over their expected useful life. The Company uses a five year life for computer equipment.
(F) Income Taxes
The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
(G) Business Segments
The Company operates in one segment and therefore segment information is not presented.
(H) Revenue Recognition
The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.
(I) Fair Value of Financial Instruments
The carrying amounts reported in the balance sheet for accounts payable and loan payable approximate fair value based on the short-term maturity of these instruments.
6
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
NOTE 2 PROPERTY AND EQUIPMENT
At December 31, 2010 and September 30, 2010 property and equipment is as follows:
|
December 31,
2010
|
September 30,
2010
|
|||||||
|
Computer Equipment
|
$ | 4,908 | $ | 4,908 | ||||
|
Less accumulated depreciation
|
(2,782 | ) | (2,535 | ) | ||||
| $ | 2,126 | $ | 2,373 | |||||
Depreciation expense for the three months ended December 31, 2010 and 2009 and the period from August 14, 2007 to December 31, 2010 was $247, $247 and $2,782 respectively.
NOTE 3 STOCKHOLDERS’ EQUITY/DEFICIENCY
(A) Common Stock Issued for Cash
On October 14, 2010, the Company issued 50,000 shares of common stock for $5,000 ($0.10/share).
On August 10, 2010, the Company issued 50,000 shares of common stock for $5,000 ($0.10/share).
On July 20, 2010, the Company issued 50,000 shares of common stock for $5,000 ($0.10/share).
On April 13, 2010, the Company issued 75,000 shares of common stock for $7,500 ($0.10/share).
On February 17, 2010, the Company issued 50,000 shares of common stock for $5,000 ($0.10/share).
On November 4, 2009, the Company issued 100,000 shares of common stock for $10,000 ($0.10/share).
During March and April 2009, the Company issued 275,000 shares of common stock for $27,500 ($0.10/share).
During October and November 2007, the Company issued 197,500 shares of common stock for $19,750 ($0.10/share).
During October 2007, the Company collected $85,000 ($0.10/share) for the sale of 850,000 shares of common stock made during the period from August 14, 2007 (inception) through September 30, 2007.
7
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
For the year ended September 30, 2007 the Company issued 390,000 shares of common stock for $39,000 ($0.10/share).
(B) In-Kind Contribution
For the three months ended December 31, 2010, a shareholder of the Company contributed services having a fair value of $1,300 (See Note 6).
For the year ended September 30, 2010, a shareholder of the Company contributed services having a fair value of $5,200 (See Note 6).
For the three months ended December, 31 2010, the Company recorded contributed interest expense having a fair value of $6,412 (See Note 4).
For the year ended September 30, 2010, the Company recorded contributed interest expense having a fair value of $25,506 (See Note 4).
For the year ended September 30, 2009, the Company recorded contributed interest expense having a fair value of $16,118 (See Note 4).
For the year ended September 30, 2009 a shareholder of the Company contributed services having a fair value of $5,200 (See Note 6).
For the year ended September 30, 2008 a shareholder of the Company contributed services having a fair value of $5,200 (See Note 6).
For the period from August 14, 2007 (Inception) through September 30, 2007 a shareholder of the Company contributed services having a fair value of $700 (See Note 6).
For the period from August 14, 2007 (Inception) through September 30, 2007 a principal stockholder of the Company contributed cash of $100 (See Note 6).
(C) Stock Issued for Services
On August 14, 2007, the Company issued 5,000,000 shares of common stock to its founders having a fair value of $500 ($0.0001/share) in exchange for services provided (See Note 6).
(D) Treasury Shares
During the year ended September 30, 2009, the Company re-purchased 1,424,731 shares of common stock for $53,000.
8
NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
During the year ended September 30, 2008, the Company re-purchased 1,075,269 shares of common stock for $40,000.
NOTE 4 LOAN PAYABLE
Through September 30, 2009, the Company received $325,750 of advances to fund operations of which $40,000 was repaid in 2009. The loans were made pursuant to the Letter of Intent (See Note 8). The remaining loan balance at December 31, 2010 is $285,750. Through the December 31, 2010 the Company recorded $48,036 as an in kind contribution of interest. The advances are unsecured, non interest bearing and due on demand (See Note 3(B)).
NOTE 5 COMMITMENTS
On October 12, 2007 the Company entered into a consulting agreement to receive administrative and other miscellaneous services. The Company is required to pay $5,000 a month. The agreement will remain in effect unless either party desires to cancel the agreement. This agreement has been terminated effective October 1, 2008.
NOTE 6 RELATED PARTY TRANSACTIONS
For the three months ended December 31, 2010, a shareholder of the Company contributed services having a fair value of $1,300 (See Note 3(B)).
For the year ended September 30, 2010 a shareholder of the Company contributed services having a fair value of $5,200 (See Note 3(B)).
For the year ended September 30, 2009 a shareholder of the Company contributed services having a fair value of $5,200 (See Note 3(B)).
For the year ended September 30, 2008 the shareholder of the Company contributed services having a fair value of $5,200 (See Note 3(B)).
For the period from August 14, 2007 (Inception) through September 30, 2007, the Company received $100 from a principal stockholder. Proceeds have been recorded as an in-kind contribution (See Note 3(B)).
For the period from August 14, 2007 (Inception) through September 30, 2007 the shareholder of the Company contributed services having a fair value of $700 (See Note 3(B)).
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NEXT FUEL, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2010
(UNAUDITED)
On August 14, 2007, the Company issued 5,000,000 shares of common stock to its founders having a fair value of $500 ($0.0001/share) in exchange for services provided (See Note 3(C)).
NOTE 7 GOING CONCERN
As reflected in the accompanying unaudited condensed financial statements, the Company is in the development stage with no operations and has a net loss since inception of $481,168 and negative cash flows from operations of $396,692 from inception. In addition there is a working capital deficiency of $301,308 and stockholders’ deficiency of $299,182 as of December 31, 2010. This raises substantial doubt about its ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.
NOTE 8 BINDING LETTER OF INTENT
On April 6, 2009 the Company entered into a binding letter of intent with Next Fuel, Inc. Pursuant to the letter of intent, the Company will issue to Next Fuel approximately 75% of the Company’s outstanding shares for total consideration of $300,000. As of December 31, 2010, the terms of the agreement have not been completed (See Note 4).
On May 29, 2009, in connection with the letter of intent with Next Fuel, Inc., the Company filed a Certificate of Amendment to the Articles of Incorporation changing the Company’s name to Next Fuel, Inc. (See Note 1 (A)).
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.
Overview
We were incorporated in Nevada in August 2007 to conduct clinical trials for pharmaceutical companies in dedicated sites throughout the Americas. Initially, we intended to introduce our services in Central America. This was being done primarily because the costs of drug development are significantly lower and the clinical quality is that of the US. We planned to sell our services to Pharmaceutical, Biotech and Medical Device companies that are primarily US based. Our principal executive office location and mailing address is 210 Walford Way, Cary, NC 27519. Our telephone number is 919-414-1458.
Plan of Operation
We were trying to establish business relationships with preferred Clinical Research Organization’s (“CRO’s”) who will source and package our services to their clients. Many pharmaceutical companies prefer large global companies that can provide a one-stop shop approach. Since what we do is only a sub segment of the client’s total needs we will be a subcontractor should those CRO’s find opportunities where our services can be of benefit to their clients.
1. As we raised more than $124,000 in our private placement, we have been trying to implement our plan to provide clinical trial services throughout the Americas.
2. All business functions are being coordinated and managed by the two founders of the Company, including marketing, finance and operations. As we raised more than $124,000 through our private placement, we had intended to hire a part-time employee to facilitate with the acquisition of contracts and assist in targeted marketing implementation. The lack of business has not justified this hire.
3. We intended to launch a targeted marketing campaign focusing on trade show participation, media promotions and public relations. We intended to support these marketing efforts through the development of high quality printed marketing materials and an attractive and informative trade and consumer website, www.clinicaltrialsofamerica.com. We expected the total cost of the marketing program to range from $10,000 to $75,000. During this preliminary launch period, we also expected to invest between $1,000 and $5,000 in accounting and inventory management software. We accomplished some of our goals but because of the economic downturn we were unable to create any real business transactions.
To date we have not commenced generating revenues and do not know when we will begin generating revenues. The economic downturn has been particularly difficult for smaller firms in our business.
Due to our inability to obtain adequate financing and our inability to successfully implement our business plan, we feel that it is necessary for us to cease operations and actively pursue a potential reverse merger candidate.
Results of Operations
For the three months ended December 31, 2010, we had $0 in revenue. Operating expenses for the three months ended December 31, 2010 totaled $11,315 and interest expense totaled $6,412 which resulted in a loss of $17,727. Operating expenses of $11,315 for the three months ended December 31, 2010 consisted of $2,614 for general and administrative expenses and $8,701 for professional fees.
For the three months ended December 31, 2009, we had $0 in revenue. Operating expenses for the three months ended December 31, 2009 totaled $7,857 and interest expense totaled $6,482 which resulted in a loss of $14,339. Operating expenses of $7,857 for the three months ended December 31, 2009 consisted of $2,232 for general and administrative expenses and $5,625 for professional fees.
Capital Resources and Liquidity
As of December 31, 2010, we had $0 in cash and therefore we have limited capital resources and will rely upon the issuance of common stock and additional capital contributions from shareholders to fund administrative expenses. Cash and cash equivalents from inception to date have been sufficient to cover expenses involved in starting our business. We will require additional funds to continue to implement and expand our business plan during the next twelve months
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We currently do not have enough cash to satisfy our minimum cash requirements for the next twelve months. As reflected in the accompanying condensed unaudited financial statements, we are in the development stage with no operations and have a net loss since inception of $481,168 and negative cash flows from operations of $396,692 for the period from August 14, 2007 (inception) to December 31, 2010. In addition there is a working capital deficiency of $301,308 and stockholders’ deficiency of $299,182 as of December 31, 2010. This raises substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to raise additional capital and implement our business plan. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.
Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for us to continue as a going concern.
Critical Accounting Policies
Revenue Recognition
The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.
Cash and Cash Equivalents
The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At December 31, 2010 and September 30, 2009, respectively, the Company had no cash equivalents.
Loss Per Share
Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by FASB Accounting Standards Codification Topic 260, “Earnings Per Share”. As of December 31, 2010 and 2009, respectively, there were no common share equivalents outstanding.
Property and Equipment
The Company values property and equipment at cost and depreciates these assets using the straight-line method over their expected useful life. The Company uses a five year life for computer equipment.
Income Taxes
The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
Off Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not required for smaller reporting Companies.
Item 4T. Controls and Procedures
(a) Evaluation of disclosure controls and procedures. At the conclusion of the period ended December 31, 2010 we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective and adequately designed to ensure that the information required to be disclosed by us in the reports we submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms and that such information was accumulated and communicated to our Chief Executive Officer and Chief Financial Officer, in a manner that allowed for timely decisions regarding required disclosure.
(b) Changes in internal controls. During the period covered by this report, there was no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
Item 1A. Risk Factors
This item does not apply to a smaller reporting company such as us.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
On October 14, 2010, the Company issued 50,000 shares of common stock for $5,000 ($0.10/share).
These securities were issued pursuant to the exemption provided under Section 4(2) of the Securities Act. These shares of our common stock qualified for exemption since the issuance of shares by us did not involve a public offering. The issuance was not a “public offering” as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of shares offered. We did not undertake an offering in which we sold a high number of shares to a high number of investors. In addition, the shareholder had the necessary investment intent as required by Section 4(2) since she agreed to and received share certificates bearing a legend stating that such shares are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these shares would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act for this transaction.
Item 3. Defaults Upon Senior Securities
None.
Item 4. (Removed and Reserved)
Item 5. Other Information
None
Item 6. Exhibits
(a) Exhibits
31.1 Certifications pursuant to Section 302 of Sarbanes Oxley Act of 2002
32.1 Certifications pursuant to Section 906 of Sarbanes Oxley Act of 2002
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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NEXT FUEL, INC.
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Date: February 10, 2011
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By:
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/s/ John Cline
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John Cline
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President, Chief Executive Officer,
Chief Financial Officer,
Chairman of the Board of Directors
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