Attached files
| file | filename |
|---|---|
| EX-32.1 - EXHIBIT 32.1 - NextGlass Technologies Corp. | v440114_ex32-1.htm |
| EX-31.1 - EXHIBIT 31.1 - NextGlass Technologies Corp. | v440114_ex31-1.htm |
| EX-31.2 - EXHIBIT 31.2 - NextGlass Technologies Corp. | v440114_ex31-2.htm |
| EX-32.2 - EXHIBIT 32.2 - NextGlass Technologies Corp. | v440114_ex32-2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
| x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2016 |
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO |
Commission file number: 000-55385
NEXTGLASS TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)
BLACK GROTTO ACQUISITION CORPORATION
(Former name of registrant as specified in its charter)
| Delaware | 47-3150674 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| 9454 Wilshire Boulevard, Suite 610 | ||
| Beverly Hills, California | 90210 | |
| (Address of principal executive offices) | (Zip code) |
Registrant's telephone number, including area code: 011 6012 3911706
Indicate by check mark whether the registrant (1) has filed all reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ¨ | Accelerated filer | ¨ | |
| Non-accelerated filer | ¨ | Smaller reporting company | x |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes x No ¨
As of March 31, 2016, the registrant had 10,000,000 shares of common stock outstanding.
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PART I - FINANCIAL INFORMATION
Item 1. Unaudited Condensed Financial Statements
NextGlass Technologies Corporation
Condensed Balance Sheets
| March 31, 2016 | December 31, 2015 | |||||||
| (unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash at bank | $ | 50,172 | $ | 57,219 | ||||
| Interest receivable | 153 | - | ||||||
| Total current assets | 50,325 | 57,219 | ||||||
| Related party receivable | 90,000 | - | ||||||
| Total assets | 140,325 | 57,219 | ||||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| Current liabilities | ||||||||
| Accrued interest | 479 | - | ||||||
| Deposit for stock to be issued | 61,000 | 61,000 | ||||||
| Total current liabilities | 61,479 | 61,000 | ||||||
| Note payable | 150,000 | - | ||||||
| Total liabilities | 211,479 | 61,000 | ||||||
| Stockholders' deficit | ||||||||
| Preferred stock, $0.0001 par value, 20,000,000 shares authorized; none issued and outstanding as of December 31, 2015 and March 31, 2016, respectively | - | - | ||||||
| Common stock, $0.0001 par value, 200,000,000 shares authorized; 10,000,000 shares issued and outstanding as of December 31, 2015 and March 31, 2016, respectively | 1,000 | 1,000 | ||||||
| Discount on common stock | (500 | ) | (500 | ) | ||||
| Additional paid in capital | 7,912 | 3,212 | ||||||
| Accumulated deficit | (79,566 | ) | (7,493 | ) | ||||
| Total stockholders' deficit | (71,154 | ) | (3,781 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 140,325 | $ | 57,219 | ||||
See accompanying notes to unaudited financial statements.
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NextGlass Technologies Corporation
Unaudited Condensed Statements of Operations
| From Inception | ||||||||
Three Months Ended March 31, 2016 | January 12, 2015 to March 31, 2015 | |||||||
| Revenue | $ | - | $ | - | ||||
| Cost of revenue | - | - | ||||||
| Gross profit | - | - | ||||||
| G&A expenses | 71,747 | 712 | ||||||
| Income (loss) from Operating | (71,747 | ) | (712 | ) | ||||
| Other income (expense) | (326 | ) | - | |||||
| Income tax expense | - | - | ||||||
| Net income (loss) | $ | (72,073 | ) | $ | (712 | ) | ||
| Loss per share - basic and diluted | $ | (0.01 | ) | $ | (0.00 | ) | ||
| Weighted average shares - basic and diluted | 10,000,000 | 20,000,000 | ||||||
See accompanying notes to unaudited financial statements.
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NextGlass Technologies Corporation
Unaudited Condensed Statements of Cash Flows
| From Inception | ||||||||
Three Months Ended March 31, 2016 | January 12, 2015 to March 31, 2015 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net income (loss) | $ | (72,073 | ) | $ | (712 | ) | ||
| Non-cash adjustments to reconcile net loss to net cash: | ||||||||
| Expenses paid by stockholder and contributed as capital | 4,700 | 712 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Interest receivable | (153 | ) | - | |||||
| Accrued interest | 479 | - | ||||||
| CASH USED IN OPERATING ACTIVITIES | (67,047 | ) | - | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Related party receivable | (90,000 | ) | - | |||||
| CASH USED IN INVESTING ACTIVITIES | (90,000 | ) | - | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from note payable | 150,000 | - | ||||||
| CASH PROVIDED BY FINANCING ACTIVITIES | 150,000 | - | ||||||
| Net decrease in cash | (7,047 | ) | - | |||||
| Cash, beginning of period | 57,219 | - | ||||||
| Cash, end of period | $ | 50,172 | $ | - | ||||
| Supplemental cash flow information: | ||||||||
| Interest paid | $ | - | $ | - | ||||
| Income tax paid | $ | - | $ | - | ||||
See accompanying notes to unaudited financial statements.
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NextGlass Technologies Corporation
Notes to Unaudited Condensed Financial Statements
NOTE 1 – ORGANIZATION AND BUSINESS DESCRIPTION
General
NextGlass Technologies Corporation (the “Company”) is an early-stage company planning to produce and distribute glass products (which the Company calls “smart glass” solutions). The Company intends to make these products based on technology that is covered by patents that it licenses from another company. The Company was incorporated in the State of Delaware in January 2015, and was formerly known as Black Grotto Acquisition Corporation (“Black Grotto” or “Black Grotto Acquisition”).
In June 2015, the Company implemented a change of control by issuing shares to new shareholders, redeeming shares of existing shareholders, electing new officers and directors and accepting the resignations of its then existing officers and directors. In connection with the change of control, the shareholders of the Company and its board of directors unanimously approved the change of the Company’s name from Black Grotto Acquisition Corporation to NextGlass Technologies Corporation in May 2015.
On July 1, 2015, the Company (as the Licensee) entered into a Commercialization Agreement with respect to certain assets (the “License Agreement”) with NextGlass Co., Ltd., a company incorporated in Korea (the “Licensor”). As the Licensee under the License Agreement, the Company is permitted full rights to the patents of the Licensor to commercialize products, including building the plant and facilities for such commercialization. The patents covered by the License Agreement consist of 9 patents held by the Licensor. Eight of these patents are registered in Korea, and one patent is registered in Taiwan.
Pursuant to the License Agreement, in exchange for the rights granted by Licensor to Licensee thereunder, both parties agree that Licensee is obligated to share 50% of the profits with the Licensor. For purposes of the License Agreement, the term “profits” means the audited profits before taxation figures. The profits due to the Licensor per the foregoing are required to be paid in full by the Company (as the Licensee) within 30 days from the date of audited accounts of Licensee.
The Company is located at 9454 Wilshire Boulevard, Suite 610, Beverly Hills, California 90210. The Company’s main phone number is 011-601-2391-1706.
Our Business
The Company plans to produce and distribute glass products (which the Company calls “smart glass” solutions). The Company intends to make these products based on technology that is covered by patents that it licenses from another company.
The Company plans to make smart glass solutions for many types of applications, including car windows, car sunroofs and airplane windows.
The Company’s smart glass solutions are expected to include adhesive film inside the smart glass, bullet-proofing, non-scattering effects, noise reduction, ITO-coated film, PDLC-coated Film and functional glass. The Company’s smart glass solutions are intended to help users of the products control room temperature and change the color and the amount of light passing through the smart glass product.
In the future, the Company plans to raise additional funds in order to build its own factory and purchase machineries to manufacture the smart glass internally using the patented technologies licensed under the License Agreement.
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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Company in accordance with the accounting principles generally accepted in the United States of America (“US GAAP”).
Use of Estimates
The preparation of the financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and the related disclosures of contingent assets and liabilities. Management makes its estimates based on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates.
Cash and Cash Equivalents
Cash and cash equivalents represent cash on hand, demand deposits, and other short-term highly liquid investments placed with banks, which have original maturities of three months or less and are readily convertible to known amounts of cash.
Income Taxes
The Company accounts for income taxes in accordance with ASC 740, Income Taxes (“ASC 740-10”) which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. This method also requires the recognition of future tax benefits such as net operating loss and tax credit carryforwards, to the extent that realization of such benefits is more likely than not. A valuation allowance is recorded when the realization of future tax benefits is uncertain.
Earnings (Loss) Per Share
Basic earnings per share are computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share are computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method and if converted method.
Effect of Recent Accounting Pronouncements
On June 12, 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) No. 2015-10—Technical Corrections and Improvements. The amendments in this Update cover a wide range of Topics in the Codification. The amendments in this Update represent changes to make minor corrections or minor improvements to the Codification that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. This Accounting Standards Update is the final version of Proposed Accounting Standards Update 2014-240—Technical Corrections and Improvements, which has been deleted. Transition guidance varies based on the amendments in this Update. The amendments in this Update that require transition guidance are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. All other amendments will be effective upon the issuance of this Update. Management is in the process of assessing the impact of this ASU on the Company's financial statements.
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NOTE 3 – GOING CONCERN
The Company has not yet generated any revenue since inception to date and has sustained net loss of $72,073 for the three months ended March 31, 2016. The Company had a negative working capital of $11,154 and an accumulated deficit of $79,566 as of March 31, 2016. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations and/or obtaining additional financing from its members or other sources, as may be required.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern; however, the above condition raises substantial doubt about the Company’s ability to do so. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.
In order to maintain its current level of operations, the Company will require additional working capital from either cash flow from operations or from the sale of its equity. However, the Company currently has no commitments from any third parties for the purchase of its equity.
NOTE 4 – RELATED PARTY RECEIVABLE
During the three months ended March 31, 2016, the Company advanced $90,000 to a related party through holding a promissory notes bearing interest at 4% per annum. The note and relative interest shall be due and receivable on March 3, 2018.
NOTE 5 – STOCKHOLDERS’ EQUITY
On January 22, 2015, the Company issued 20,000,000 founders common stock to two directors and officers of which 19,500,000 were redeemed at par on June 1, 2015. On June 2, 2015, the Company issued 4,500,000 shares of its common stock to nine investors to effect change in control. On June 30, 2015, a further 5,000,000 shares of common stock were issued at a purchase consideration of $500. As of March 31, 2016, 10,000,000 shares of common stock and no preferred stock were issued and outstanding.
NOTE 6 – DEPOSIT FOR STOCK TO BE ISSUED
The Company received $61,000 as funds designated for issuing of common stock in 2015. As of March 31, 2016, no agreement has been signed; thus, the price per share and the number of shares have not been decided yet.
NOTE 7 – CONVERTIBLE PROMISSORY NOTES
During the three months ended March 31, 2016, the Company received $150,000 of cash proceeds through the issuance of convertible promissory notes bearing interest at 5% per annum over the term from the issuance date through maturity date on March 7, 2019. Interest on the notes shall be payable quarterly in arrears on January 1, April 1, July 1, and October 1 of each year.
During the term of the notes, each lender has the right to convert the notes into common shares at $5.00 per share. As of March 31, 2016, no conversion has happened yet.
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NOTE 8 – SUBSEQUENT EVENT
On January 16, 2016, the Company entered a common stock purchase agreement with a related party. The Company agrees to purchase total of 100,000 common shares from the related party by issuing total of 1,000,000 shares of common stock of the Company. The transaction was closed on April 27, 2016.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The Company is an early-stage company (only recently emerging from its status as a development-stage company) and was incorporated in the State of Delaware in January 2015. The Company has not yet generated any revenue since inception to date.
The Company anticipates that it would need substantial working capital over the next 12 months to continue as a going concern and to expand its operations to develop, build, manufacture and market smart glass products and solutions.
Revenues and Losses
Since its inception, the Company has focused its efforts on conducting market research, construction planning and development, and has devoted little attention or resources to sales and marketing or generating near-term revenues and profits. The Company has limited revenues to date and has not realized any profits as of yet. In order to succeed, the Company needs to develop a viable strategy to build, develop and market its products once they are ready to be sold.
The Company has posted no revenues and net losses of $72,073 during the three months ended March 31, 2016.
Equipment Financing
The Company has no existing equipment financing arrangements.
Pricing
The Company anticipates offering products at market-competitive prices.
Potential Revenue
The Company does not expect any potential revenue for the foreseeable future.
Alternative Financial Planning
The Company has no alternative financial plans at the moment. If the Company is not able to successfully raise monies as needed through a private placement or other securities offering (including, but not limited to, a primary public offering of securities), the Company’s ability to survive as a going concern and implement any part of its business plan or strategy will be severely jeopardized.
Critical Accounting Policies
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires making estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. The estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Early Stage of the Company and Capital Resources
Since its inception, the Company has devoted most of its efforts to business planning, research and development, recruiting management and staff and raising capital. Accordingly, the Company was considered to be in the development stage until it recently began formal operations. The Company has not generated significant revenues from its operations, and there is no assurance of future revenues.
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The Company’s proposed activities will necessitate significant uses of capital, including in the next 12 months and then beyond. There is no assurance that the Company’s activities will generate sufficient revenues to sustain its operations without additional capital, or if additional capital is needed, that such funds, if available, will be obtainable on terms satisfactory to the Company. Accordingly, given the Company’s limited cash and cash equivalents on hand, the Company will be unable to implement its business plans and proposed operations unless it obtains additional financing or otherwise is able to generate revenues and profits. The Company may raise additional capital through sales of debt or equity, obtain loan financing or develop and consummate other alternative financial plans.
Results of Operation
Three Months Ended March 31, 2016 and the period from inception January 12, 2015 to March 31, 2015
Revenue
The Company did not generate revenues during the three months ended March 31, 2016 and the period from inception January 12, 2015 to March 31, 2015.
Operating Expenses
We incurred total operating expenses of $71,747 and $712 for the three months ended March 31, 2016 and the period from inception January 12, 2015 to March 31, 2015. The increase is primarily due to consulting fees for business development and professional fees related to SEC filing.
Net Loss
During the three months ended March 31, 2016, the Company posted a net loss of $72,073. During the period from inception January 12, 2015 to March 31, 2015, the Company incurred a net loss of $712. The increase is primarily due to consulting fees for business development and professional fees related to SEC filing.
Liquidity and Capital Resources
The Company has an accumulated deficit of ($79,566) for the three months ended March 31, 2016. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and /or obtain additional financing from its stockholders and/or other third parties.
During the three months ended March 31, 2016, the Company used $67,047 of net cash in operating activities, including $4,700 received from stockholders as contributed capital to pay for expenses. The Company had a cash balance of $50,172 as of March 31, 2016.
During the three months ended March 31, 2016, the Company advanced $90,000 to a related party in investing activities.
The Company received $150,000 of net cash in financing activities during the three months ended March 31, 2016.
The Company did not incur any capital expenditures during the three months ended March 31, 2016.
The Company does not anticipate that it will generate revenue sufficient to cover its planned operating expenses in the foreseeable future, and the Company must obtain additional financing in order to develop and implement its business plan and proposed operations. If the Company is not successful in generating sufficient revenues and/or obtaining additional funding to develop its business plan and proposed operations, this could have a material adverse effect on its business, results of operations liquidity and financial condition.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
Information is not required to be filed by smaller reporting companies.
Item 4. Controls and Procedures
Pursuant to Rules adopted by the Securities and Exchange Commission, the Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of the end of the period covered by this report under the supervision and with the participation of the Company’s principal executive officer (who is also the principal financial officer).
Based upon that evaluation, he believes that the Company’s disclosure controls and procedures are not effective in gathering, analyzing and disclosing information needed to ensure that the information required to be disclosed by the Company in its periodic reports is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
This Quarterly Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this Quarterly Report.
Changes in Internal Control
There was no change in the Company’s internal control over financial reporting that was identified in connection with such evaluation that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
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There are currently no pending, threatened or actual legal proceedings of a material nature in which the Company is a party.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
On January 22, 2015, the Company issued 20,000,000 founders common stock to two directors and officers of which 19,500,000 were redeemed at par on June 1, 2015.
| Name | Number of Shares | |||
| James Cassidy | 10,000,000 | |||
| James McKillop | 10,000,000 | |||
On June 2, 2015, the Company issued 4,500,000 shares of its common stock to nine investors to effect change in control.
| Name | Number of Shares | |||
| Low Koon Poh | 700,000 | |||
| Willy Chan Foo Weng | 700,000 | |||
| Chew Wei Kiat | 100,000 | |||
| Shin Jong Dae | 390,000 | |||
| Kim Sung Su | 1,200,000 | |||
| Kim Chang Young | 300,000 | |||
| Son Young Ho | 300,000 | |||
| Kim Jeong Geon | 60,000 | |||
| Thor Seng Wah | 750,000 | |||
On June 30, 2015, a further 5,000,000 shares of common stock were issued at a purchase consideration of $500.
As of March 31, 2016, 10,000,000 shares of common stock and no preferred stock were issued and outstanding.
Item 3. Defaults upon Senior Securities
Not applicable.
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Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
(a) Not applicable.
(b) Item 407(c)(3) of Regulation S-K:
During the quarter covered by this Report, there have not been any material changes to the procedures by which security holders may recommend nominees to the Board of Directors.
(a) Exhibits
| Exhibit No. | Description of Exhibits | |
| 31.1 | Certification Pursuant to Section 302 | |
| 31.2 | Certification Pursuant to Section 302 | |
| 32.1 | Certification Pursuant to Section 906 | |
| 32.2 | Certification Pursuant to Section 906 |
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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
NEXTGLASS TECHNOLOGIES INC.
By: /s/ Low Koon Poh
Low Koon Poh
Chief Financial Officer
Dated: May 16, 2016
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